How to sell your property
Deciding to sell your property can be a difficult choice to make and there can be a number of reasons behind your desire to sell. You may simply be looking to move to a different area, you may want to move for work or family reasons, or you may be looking to capitalise on a property investment.
In our article 'A guide to buying property', we covered the process of purchasing property and although there is a large amount of crossover when it comes to selling property, your approach will be very different.
The purpose of this article is to explain the steps you are likely to take during the process of selling your property, including preparing your property for market, the viewing process, conveyancing, exchanging contracts and ultimately, the completion of the sale.
If you have decided to sell you should start to view your property as an advert and consider how you can make it more appealing to buyers. If you have any possessions, particularly large items of furniture, which you do not intend to take with you to your new property, you may want to consider disposing of or selling these items. A cluttered property is one sure way to put off potential buyers and just boxing up a few ornaments can make a huge difference.
Perhaps most importantly you should give your property a thorough clean both inside and outside as well as fixing anything such as broken door handles, cracked tiles or light fixtures. Do not overlook the external aspects of your property; you should consider dressing your outside spaces with plants and elements of colour especially if you wish to make your main entrance more welcoming which is important because this will be the first thing buyers see.
You should also consider redecorating, providing it is cost effective to do so. If you feel a room looks tired or outdated then a lick of paint or a new carpet could make a huge difference to the first impressions of a potential buyer.
Making changes like this before listing your property on the market could make a huge difference, not only to the valuation but also to the value of the offers from potential buyers and the speed in which your property sells.
Getting an accurate valuation
Getting the price right for your property could make a significant difference to the amount of time it takes to sell the property, as an overpriced property is likely to remain on the market for a long time. To establish a property valuation that is accurate to the current and local market it is important that you do your own research as well asking estate agents to value your property.
One of the first steps you can take to ascertain a truthful valuation could be to search for similar properties in your area to see what prices they are selling for. You should also take note of any property sales on your street or the streets nearby because these can also give you a good indication of your property's value and the popularity of your neighbourhood.
You can get valuations from mortgage lenders but they will often undervalue your property by up to 20% compared to estate agents in order to protect their interests. Generally speaking, a good rule of thumb is to ask three separate local estate agents to value your home and then take an average valuation from these. However, before choosing an estate agent to sell your property you must be aware of the costs involved especially because it is possible to sell your property without an estate agent.
Additionally, when deciding upon an asking price you should be aware that buyers will presume that there is room for negotiation and therefore you may wish to consider putting your property on the market for 5-10% more than you think it will sell for.
The process of transferring home ownership from the seller to the buyer is called conveyancing and covers the legal side of the transaction. Conveyancing is usually completed by a property solicitor or a licensed conveyancer and it is vital that you research and choose an experienced firm to carry out this procedure. It can be the difference between a smooth successful transaction and the sale falling through.
The conveyancing process will begin once you have received a formal offer, therefore in order to ensure that the process is not held up at this stage it is important that you have selected a conveyancing firm prior to putting your property on the market. This will also give you the opportunity to find a conveyancer in your own time instead of being rushed into making a decision that could be costly later down the line. If you end up choosing a conveyancing firm that is not experienced or appears to lack knowledge of the process they could hinder the sale of the property which may lead to the transaction falling through. This scenario will not be pleasant as you will have lost time and money. Not only that, but if you are in the process of buying a new property to move into, conveyancing issues could potentially have other knock on effects that may compromise your new property purchase because you are in a 'housing chain'.
Therefore, it is vital that you select a conveyancing firm that is experienced and has a wealth of knowledge to call upon during the process. A conveyancer will be responsible for drafting the property contract and negotiating terms with the buyer and yourself. This contract will usually be based around a detailed questionnaire that your conveyancer will ask you to complete. You must complete this questionnaire truthfully and if your answers are later found to be deceptive you may make the buyer suspicious which could lead them to backing out or they could even sue you.
Choosing an estate agent or selling online
When you come to choosing an estate agent to sell your home you must consider their reputation, what type of property they specialise in, their marketing reach, their high street presence, the personality of the staff, their local knowledge and how much their services will costs. Typically, an estate agent's commission fee will be between 1.2% and 3.6% of the final sale price of your home. Prior to agreeing terms you should clarify if this fee covers the advertising costs, the cost of preparing the advert, the 'For Sale' board, viewing services and whether or not VAT is included. If these costs are not included in the commission fee you should ask for the total cost of these services.
Alternatively, you could consider selling your property online and doing so can save you a lot of money. The majority of online estate agents have the same marketing approach which is to advertise on property websites such as Rightmove, Zoopla and Primelocation and their fees are usually at a flat rate of around £300 which is normally paid up front. However, if you do intend to sell your property online it is still advisable to ask a local estate agent to value your home in order to list your property at an accurate price.
When placing your property on the market, whether through an estate agent or online, you have to provide an Energy Performance Certificate (EPC) free of charge to any potential buyer within 7 days of your property being on the market. If you do not meet this requirement you might be faced with a £200 penalty charge from Trading Standards. Therefore, it is advisable that you get an EPC prior to advertising your property.
The viewing process
As previously discussed, first impressions are key and maximising the best features of your property can really enhance this. The expertise and experience of an estate agent showing a potential buyer around your property can also improve the chances of receiving an offer.
However, if you've decided to sell the property yourself or online you may be required to show people round your property yourself. This can be difficult for some because you are unlikely to be well versed in the type of questions potential buyers usually ask. If you do have to show people round your property you may also be limited as to when you can do so due to work or other commitments. This can slow down the process. One of the advantages of using an estate agent is that they can organise viewings while you are at work or on holiday which could mean that your property is seen by a higher volume of potential buyers in a shorter period of time. Whatever your approach, you should hopefully start receiving offers on your property sooner rather than later.
Accepting the offer
Once you have received a formal offer that you are satisfied with you do not have to rush to accept the offer. The offer should come with additional information such as how the buyer intends to finance the purchase and details on their chain which may affect your decision. If the buyer is financing the purchase with a mortgage you should receive information regarding whether it is already secured, how much they need to raise or if it is subject to references from their employers or accountants. Generally speaking, an offer from someone without a chain should be considered as a stronger candidate because completing the sale is likely to be quicker when compared to someone with a chain.
When you do accept an offer it is likely to be subject to contract and a satisfactory survey. Your estate agent will inform you and the buyer that the offer has been accepted and they will also instruct both parties' solicitors to begin drafting the contract. Once you have accepted an offer you are not legally obliged to remove your property from the market, however your buyer may request that you do.
Your buyer is then likely to arrange for the property to be surveyed. This is usually organised through your estate agent, if you are using one. If the survey concludes that the property requires a significant amount of work to be completed your buyer may ask you to address these issues or they may wish to renegotiate the offer to account for the repair work that is needed. This renegotiation process will be conducted through your conveyancing firm and if they are trying to negotiate the price due to the repair work you should ask to see quotes from at least two contractors or consider doing the work yourself. Always be aware that you could lose money if this renegotiation period fails and your buyer backs out forcing you to restart the selling process. Therefore, you should try to carefully judge the scenario and consider compromising or meeting in the middle in order to keep the transaction moving forward.
Exchange of contracts
A final set of contracts will be written once both parties' conveyancing firms are happy that everything is in place to complete the transaction. This could include completing any maintenance that may have been required after the buyer's survey was conducted, the buyer's mortgage has been approved, the buyer is ready to pay the deposits and the completion date has been agreed.
Both you and the buyer will receive a copy of the final contract which both parties must sign. Once they are signed the contracts will be exchanged between solicitors and both parties will become legally bound to complete the transaction. Backing out as a seller after exchanging contacts could be very costly to you as it could seriously inconvenience the buyer. Therefore, it is important you revisit your motives for selling your property and confirm that you are making the correct decision before exchanging contracts.
The completion date
The completion of the property sale usually occurs approximately four weeks after the contracts are exchanged or on the completion date specified in the contract. Your conveyancing firm will give the deeds to the property to the buyer, the buyer's mortgage lender will release the money to purchase the property and you are required to hand over the keys to the new owners of the property.
Rollingsons residential property conveyancing team are experienced lawyers who will always work to achieve your goals and understand how important your property transaction is. For more information or to arrange an initial consultation, please contact us on 0207 7611 4848.