It's no secret that the real estate market has been the bright spot in the U.S. economy over the last year. Property values have increased an average of 13% nationally since February. It should come as no surprise that property owners are taking advantage of tremendous increases in values | cashing on the equity gains. I've had several people talk to me about selling | cashing in, | what I tell all of them is to make a plan.
It starts with one of the most important questions: "Is selling what I really want to do?" Selling a property is not generally known to be a relaxing experience. It involves preparation and planning. In addition to engaging a real estate professional to list and market the home for sale, making the necessary repairs and preparing the property for showings, one needs to be clear about what happens when the property does sell. When, where, what and why are the questions that should be addressed prior to listing the property.
When: The "when" addresses timing. If it's a primary residence being sold, one must consider when it is that they ideally want to move. If moving around and being out and about during the winter months is not one's forte, then it makes sense not to list the property for sale in the late fall/winter. Addressing the "when" prior to actively marketing the property for sale will make the necessary post-closing activities easier to digest.
Where: The "where" addresses a couple of things. In the case of an owner-occupied sale, where is the seller going to move? If the intent is to cash in and rent a home, it's best to be clear about the state of the rental market. In Central Oregon (not unlike the real estate market), it's incredibly competitive, and one would be wise to begin the rental search as the property is listed for sale. If planning to purchase another home with the proceeds, where will the next home be? Does that area have the amenities, schools, medical services etc. that fit one's specific needs and desires? Having the plan around where one is going when the sale closes will make for a smoother sales process, as it helps to quell the stress of uncertainty in an already stressful situation.
What: The "what" plays a crucial role in the sale of a property and post-closing activities. One must identify what the goal of the sale is, what the plan for the proceeds is, what are the lines in the sand as a seller—considerations like, what's the sales price threshold and what as a seller won't be agreed to. What repairs and concessions may be required for a successful close and one's threshold for such requests? Essentially, making a plan ahead of time means one is better prepared in knowing where the line in the sand is to be drawn.
It's key in selling a property to be clear on the goal. Is it to cash in on the proceeds? Upsize or downsize? Or perhaps it's to move to other cities or states completely. When a seller is clear about the goal for the sale of the property, it helps one keep an eye on the proverbial prize when moving through some of the more stressful parts of the sales process. Finally, what's the plan with the proceeds? Are they to fund another property purchase, to bank the money or pay down debt? Being clear about the ultimate goal for the equity proceeds helps one stay focused on the reason for the sale.
Why: The final and crucial question, the "why" supports the when, where and what. It is the bottom-line goal. The "why" really answers the question of "does one really want to sell?" The "why" is the reason driving the plan to reach the goal, which is to close a sale. When a seller is clear on their "why," the plan comes together with greater ease and also helps the industry professionals hired to market and sell the property accomplish the goal.