Selling A House In 10 Steps
Victoria Araj11-minute read
November 21, 2022
Unless you plan to keep your home as an investment, buying another house will typically mean selling the one you’re in currently. From staking out the “For Sale” sign to arranging closing day, here are the steps you can expect to take when selling a house.
How To Sell Your House: 10 Steps
Though the process may vary from seller to seller, the typical selling process looks like this:
- Hire A Listing Agent
- Decide On A List Price
- Understand How Long It Will Take To Sell
- Renovate, Repair And Stage The Home
- List The Home
- Market Online And Offline
- Settle On A Final Offer
- Anticipate The Costs Of Selling
- Assemble Your Documentation
- Close On The Sale
Let’s dive into each of these steps and what you can expect.
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1. Hire A Listing Agent
Unless you want to learn how to sell a house by owner, your home selling journey will likely begin by finding a seller’s agent, or listing agent, who is familiar with your local market. Although they wear several hats, listing agents are responsible for representing the seller in a real estate transaction. That includes advertising the property, creating listings and researching pricing using comparative market analysis.
If you haven’t yet found the right agent, here are a few places to begin your search.
- Check out Rocket Homes℠: Learn more about your local market with Housing Market Reports, read homeowner related blogs and guides, and even sell your home with a Rocket Homes Verified Partner Agent.
- Reach out to friends and family: There’s no better referral than one that comes from a trusted friend or family member. If you have a personal contact who has sold their home recently, it’s worth your time to see if their agent is a good match for you.
- Look online: According to the National Association of REALTORS® (NAR), 74% of REALTORS® use Facebook to grow their client base. If you’re not able to find an agent in-person, continue your research on social media or the agent’s website.
- Take a tour around the neighborhood: Odds are, you’re not the only homeowner selling your house in the area. If you’re struggling to find an agent, try contacting the numbers you see on “For Sale” signs around the neighborhood. You can also tour an open house and introduce yourself to the agent hosting the event.
- Contact your previous buyer’s agent: The buyer’s agent you worked with to buy your current home may not work with sellers, but there’s a good chance they have connections to other agents in the area.
Before your agent lists your home for potential buyers, they may ask you to sign a listing agreement. Essentially, this contract gives your listing agent permission to find a buyer for your home and highlights their commission on the deal.
Make sure you’ve done your due diligence and requested referrals, read reviews from other sellers and interviewed the agent before your pen hits the paper.
2. Decide On A List Price
The list price, or asking price, represents the amount you as the seller want a buyer to pay for your home. An effective asking price considers several factors in the final sum, such as the state of the market in your area, the condition of the property and seasonality. For the most part, the comparative analysis your agent conducts will help you understand how much similar homes in the area are going for, and what you can reasonably expect to sell.
Your real estate agent can guide you to a number, but the final call rests in your hands. Also, remember that an asking price is not necessarily how much you can sell your home for.
3. Understand How Long It Will Take To Sell
Similar to buying a house, the home selling process doesn’t happen overnight. However, knowing how long it takes to sell a house can help you set the right expectations and keep the sale moving as quickly as possible. Here are some of the most important factors at play:
- Time on the market: The longer your home stays on the market, the longer the entire sale process will take. If your home has been listed for a while without any bites, you may want to reevaluate your selling strategy.Buyers may begin to assume there are problems with a house that’s been listed for longer than usual.
- Current market conditions: The difference between a buyer’s market and seller’s market could mean the difference between a lengthy transaction and a fast turnaround. When the supply of homes exceeds demand from buyers, sellers will have to compete with other homes for sale, which could be challenging if you want to sell your house fast.
- Asking price: If buyers believe your home is overpriced, you’ll be hard-pressed to find a buyer right away. That’s why determining a reasonable price with your real estate agent is so important. If your home isn’t attracting any offers, consider returning to the drawing board and offering a more competitive list price.
- A low home appraisal: A home appraisal determines the fair market value of a piece of real estate. Home appraisals that are much lower than the agreed-upon price often slow down the selling process or jeopardize the transaction completely.
Although the timeline for selling a house is partly outside of your control, there are some tactics you can use to make your home more attractive to buyers. That begins with making the home as presentable as possible.
4. Renovate, Repair And Stage The Home
One of the most common questions first-time home sellers have is, “Should I renovate my home before selling?” The answer to which depends on a few factors.
Renovations not only make a home look more enticing to potential buyers, but the right improvements can also increase your home value. However, not all renovation projects are worth the cost, time and effort they’ll take to complete Your real estate agent should be able to advise you on the top areas of focus that will help your property attract the best bid.
Once you’ve completed repairs, you’re ready to stage the house. Start with a top-to-bottom deep cleaning and spend time on both the interior and exterior for curb appeal. As you scrub down appliances and declutter each room, you should also depersonalize the space as much as possible. Removing unique decorations, painting over any rooms with loud wall colors and putting away family portraits can all help the buyer imagine the home as their own.
Sellers who don’t have the time or energy to stage a home themselves should try shopping around for home staging companies. These businesses help sellers furnish, decorate and redesign a space – both physically and digitally. Adding this cost will bite into your bottom line, but the expense may be worth it for sellers who need a speedy sale or want to stand out against other houses in the neighborhood.
For more tips on which types of improvements you should make, read our article on how to get a house ready to sell.
5. List The Home
Now that your home is in good shape, you’re ready to list the home and attract buyers. The real estate firm or agent who represents you is responsible for this step. Once they’ve shared your home on the multiple listing service (MLS) – which is a database of every home currently for sale in the area – buyer’s agents will be able to view your property and some basic property details.
6. Market Online And Offline
Advertising your home for sale helps your listing reach the right buyers and put you in the best position when it comes time to accept an offer. Even if you haven’t sold a house before, you’re likely familiar with open houses, “For Sale” signs in the front yard and other traditional marketing tactics.
However, in today’s real estate landscape, sellers may need to adapt to new marketing strategies to compete.
Let’s look at an example. In order to prioritize the health and safety of buyers and sellers, many agents have conducted home showings during COVID-19 online. Online home tours use an array of technologies to imitate the experience of an in-person walkthrough.
The widespread adoption of online listings signals the importance of digitally marketing your property. Here are a few tactics you should consider:
- Invest in professional-grade photography for your online listings: High-quality images put your home in the best light for buyers who prefer to shop for homes online, and an excellent photographer can help you capture areas that you and your agent may otherwise miss.
- Work with an agent who is comfortable with virtual tours: Although virtually guided walkthroughs are becoming more popular, not every listing agent may have experience arranging them. Before you hire your agent, ask them if they have the experience and equipment to stage virtual tours.
7. Settle On A Final Offer
For many sellers, choosing which offer to accept is pretty simple, with the home usually going to the highest bidder. But there are a few other factors you should weigh beyond price.
- Are there any cash offers on the table?
- Or, is the buyer applying for a loan, and do they have a preapproval or just a prequalification?
- Is the buyer’s offer attached to any contingencies, and what contingencies are they willing to waive?
- Do the buyer’s proposed negotiations align with what you need from the deal?
With these questions in mind, you’re better prepared to accept the best offer all-around and move toward closing.
8. Anticipate The Costs Of Selling
Selling comes with a number of expenses that you’re responsible for paying. Here are the main costs of selling a house to keep in mind.
Although buyers and sellers pay different fees at closing, both parties are responsible for closing costs as they finalize the transaction. Closing costs for the seller usually include attorney fees, escrow fees, outstanding HOA fees and property taxes up to the official closing date.
You may also end up covering some additional closing costs on behalf of the buyer. Sellers often pay the real estate commissions for both the buyer’s and seller’s agents, which is around 5% – 6% of the purchase price. As part of the offer negotiations, the buyer might ask you to pay some of their closing costs; this is called seller concessions.
Capital Gains Tax
If your home has increased in value more than $250,000 from the time you purchased the home (your real estate cost basis) to the time of your home sale, you should also keep the capital gains tax on your radar. Essentially, a capital gains tax is an expense you would pay on any asset that has appreciated in value. Many sellers will be exempt from paying a capital gains tax, though this does depend on your unique situation.
Even if you plan to recruit friends and family to help move you out, there’s a good chance that moving out of your home will cost you something. If the timing’s right and you can buy and sell a home at the same time, you can have your movers move everything in one fell swoop. But if there’s time between when you buy and when you sell, you’ll also need to budget in the costs of storing and relocating your belongings.
9. Assemble Your Documentation
- Seller’s Disclosure: Also known as a property disclosure, a Seller’s Disclosure is a legal document that lists and explains any defects in the home. In an effort to protect buyers, these types of disclosures are required by most states.
- Closing Disclosure: Though the Closing Disclosure is presented mainly for the benefit of the buyer, you may also receive a copy if you’ve agreed to pay some or all of the buyer’s closing costs.
- Deed and transfer documents: Your deed is the document that allows you to transfer title to the home buyer. Along with other transfer documents, you’ll need to sign the deed to certify the transfer of ownership.
- Government ID: Both buyers and sellers should bring a photo ID to verify their identities while attending the closing.
10. Close On The Sale
With the rest of the process checked off, you’re ready for the final step – closing on the home. For home buyers, closing means attending the closing date. Sellers, on the other hand, are not always required to attend their closings. If you’ve already signed the necessary paperwork, certain states allow your attorney to represent your side of the transaction in your absence.
For sellers who have the opportunity, skipping out on the table closing presents both pros and cons. Sellers who don’t attend can avoid the risk of any final conflicts with the buyer, but some attorneys or agents may prefer for you to attend regardless.
In the event that you do not attend, your attorney or agent should be granted power of attorney to sign any remaining documents on your behalf. Keep in mind that you may be required to attend closing if you’re planning on renting the house from the buyer through a rent-back agreement.
With closing completed on both the buyer’s and seller’s ends, you’ve successfully sold your home to its new owner.
Selling A House FAQs
There’s a lot to think about during the process of selling a house. Let’s take a look at some of the most frequently asked questions.
How much does it cost to sell a house?
When you sell your house, there are several expenses you should be aware of. The costs of selling a house typically include real estate commission, pre-inspections, cleaning, repairs and improvements, staging, utilities, home warranty, capital gains tax, closing costs, remaining mortgage balance and moving.
It’s important to understand how long you should live in your house before selling to ensure you turn some level of profit.
Can you sell a house with a mortgage?
Yes, you can sell your house if you have an existing mortgage. When you sell your home, the sale profits can often be used to pay off your mortgage balance and any closing costs. Just be sure to check with your lender on any prepayment penalties.
What happens to the money when I sell my house?
As mentioned above, the cost of selling a house may cost you, but hopefully, the money from your home sale can be used for capital gains tax, closing costs, real estate commissions or paying off your mortgage.
How long does it take to sell a house?
Selling a house doesn’t happen overnight. How long it takes to sell a house depends on the status of the market, how long the house has been on the market, the asking price, property condition and location.
Can I sell my house without a REALTOR®?
Although you can often avoid paying real estate commissions for your listing agent, there still may be a buyer’s agent commission you’ll have to pay as the seller. When you list FSBO, you’ll be solely responsible for the entire marketing and transaction process, and many home seller’s find it worth the cost to work with a REALTOR® for an easier selling experience.
The Bottom Line
Selling a home may seem stressful, but many sellers are rewarded with a new place to call home once they’ve handed their keys over to the new owners.
If you’re looking to buy a new home while moving out of your existing one, get started on your purchase today with help from Rocket Mortgage®.
Start by getting approved to buy a home.
No matter if you choose to buy or sell first.
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