Selling a home is a difficult decision. It definitely shouldn’t be something you rush. It can take several months to find a new place to live, and it can take months until the home sale is completed.
There are many reasons why people choose to sell their home. They may need to move to be closer to their family or place of employment. Other times, they may want to upgrade or downsize accordingly as their family size changes. Some people decide to sell their home because they want to move to a new neighborhood, state, city or country.
Whatever the reason is, take as much time as you need to sell your home. Here are a few things to keep in mind:
1. Pay attention to market conditions.
One of the first things you should do is to see what other houses in your area are selling for. Look at listings online to see what the asking prices are for homes that are similar to yours.
You should also look to see how long these properties have been on the market for, on average. This will give you a good idea of what your asking price should be.
2. Talk to a realtor.
When you’re ready to sell your home, schedule a meeting with a real estate agent. Some people choose to sell their homes by themselves, but most people lack the experience and knowledge of the market that realtors have. The realtor will listen to your concerns and work with you on creating a plan of action to sell your home.
3. Set an asking price.
After you’ve done your homework, it’s time to set an asking price. Your price should be realistic, reflecting the current market demand for the same type of homes in your area.
Your realtor can help you set a price that is reasonable according to what the market will bear.
4. Start reviewing offers.
You’ll likely receive several offers during the first few weeks after you’ve put your home up for sale. Some of them may be from interested parties who have viewed your home in person at an open house, or a scheduled showing.
When you’ve found an offer that you like, you can accept the offer, or you can counter and go back and forth with a prospective buyer several times until you agree on a price. Once you’ve accepted an offer, the process of closing on the sale of your home will be in full motion.
5. Close the deal.
After the appraisal and home inspection is scheduled by the buyer, the closing process is in full force. There may be closing costs and other expenses for both parties.
Once all final paperwork is signed and you receive your payment, your keys will be handed over to the new owner and the transaction will be complete.
Another thing to consider are the taxes that are associated with selling a house. Depending on the laws in your state, you may be required to pay taxes on the income you earn from the sale. There are some tax breaks that can be applied.
If you’ve lived in your home for at least two years before the home is sold, you won’t have to pay taxes on the first $250,000 in profit on the sale. This amount doubles if you are married and file a joint tax return. Keep in mind that this only applies to the profit made on the transaction.
To determine your profit, you’ll need to take the price you paid for your house and add any costs for repairs or maintenance. This total is your cost basis. Then take the price that you sold your home for and deduct the realtor fees and any closing costs that you paid. This total is the amount earned. Subtract the cost basis from your amount earned to find your total profit.
In order to qualify for this kind of tax break, you must have owned the home for at least the last two years. The home in question must also have been your primary residence for at least two of the last five years.
Rental properties, lakeshore cabins and vacation homes would most likely not qualify for this deduction. You can only claim this tax break once over a two year period. This can be a deterrent for people who own multiple homes or properties and want to find additional ways to lower their overall tax bill.
It is possible to use this kind of tax exclusion to build retirement income, but it’s not for everyone. You would have to either buy or build a new home and then turn around and sell it every two years to start accumulating such assets.
The extra income would be tax-free, but it can be a burden for most people and families having to move every couple of years. This kind of strategy could also backfire during market downturns. In these instances, it may take longer than a couple of years to sell your home, leaving you with a greater financial burden than before.
Taxes can be tricky. If you’re unsure of what you will and won’t have to pay, ask a real estate attorney or certified public accountant for assistance. Make sure that you understand your responsibilities before filing your taxes to avoid any possible penalties or missed deductions. They are sometimes unpleasant, but are a very important part of the home selling process.
Contact The Norber Real Estate Group
The best source of information about local communities and real estate topics is your real estate agent. Give Joshua Norber of the Norber Real Estate Group a call today at 248-785-3737 to learn more about the area, discuss selling your house, or tour available homes for sale.