Selling Your Home

Selling a home is obviously a very complicated ordeal. That is why REALTORS make the money they do. I will, however, try to break it down in a fairly comprehensive manner, and maybe even debunk a few myths in the process.So you want to sell your home...Why? The first thing to determine is your motivation. Why do you want to sell? Are you trying to take advantage of market conditions, avoid a possible downturn in the market? Are you relocating? Do you need more space? These questions can help chart the course, or, let you know that it might not be the right time to sell. If you are trying to sell to take advantage of market conditions at the same time as other speculators are trying to dump properties, then you are going to be competing to sell in a saturated market. Also, if you are relocating to an out of county area than that will have a factor in how aggressively you are going to attempt to sell. If you have time to plan and prepare your house for sale, then you will likely be able to get top dollar for your home. So first things first- figure out your “why”.You will also need to know what you need or want to get out of your home, and then what you can get out of your home. Mot certainly not the same number, however much you want it to be.A general idea will work for now. You are only evaluating your options at this point. Of course, you need to know what debt will have to pay off when you sell the home and also what it will cost to sell the home. Always be conservative at this point. You will need to know if you have any hard pre-payment penalties, meaning that even if you sell your home, you still owe the bank a pre-pay. A soft pre-pay is only for a refinance situation.An estimation of capital gains tax will also be necessary. There are many expemptions or deferments of capital gains that depend on a combination of length and type of occupancy.The last factor to include in your estimation is the cost to sell your home. With a Realtor, a general estimate can be between 7% and 8% of the (estimated) sales price. Don't worry about deciding whether or not to use a Realtor at this point- I can tell you that you will probably net about the same either way. This estimate will cover expenses such as REALTOR fees, escrow fees, title fees, termite inspection fees (although repair work can vary greatly depending on the condition of your home, location and how it has been maintained), and a slew of junk fees that are in large part more or less unavoidable.So you say you have no number to subtract these from...You probably receive a number of comparable sales updates from real estate agents and most likely have (or are) a gossipy neighbor. So it is likely that you have at least a vague idea of your homes value, or at least what some homes are selling for in the neighborhood. It is very easy to get an idea of value with tract housing, but for everyone else, using a square footage estimate is also adequate. Zillow.com is a new website from the expedia.com founders that could provide a reasonable estimate of a homes value, but in areas like San Diego, they still have some bugs to work out. Appraisals are another source to look at, but beware, often can be a little off pace with real estate sales. Because appraisals rely on past sales to derive a value, they don’t always consider market conditions that are driving current sales and buyer activity.