Advice For SellersBlogFor SellersSELL YOUR HOMESELLER December 8, 2020

10 Costs Associated with Selling Your Home

Sellers

Selling a home is an exciting time for homeowners. Once you and your household have decided that you’ll hit the market, it’s easy to think solely about the revenue that comes with the sale. However, selling a home comes with its own set of costs. Knowing what these costs are will help you budget throughout the selling process.

Here are 10 most of the most common costs that come with selling a home:

1. Commission fees

Of all the expenses that come with the sale of a home, agent commission fees are usually the largest and for good reason. Real estate agents are professionals, wielding their industry knowledge and local expertise to get the job done and save countless hours of work for the homeowner. The commission is split by the agents representing both buyer and seller, typically totaling between five and six percent of the sale price.

2. Pre-sale home inspection

Pre-sale home inspections are not mandatory, however, if a seller does not conduct one, it could lead to major costs down the road. The inspection allows the seller to find any issues with the home and properly disclose them to the buyer. If the buyer’s home inspector finds repairs that need to be made, they can ask the seller for a price reduction or require that they be fixed in order for the sale to go through.

3. Home repairs

There are varying degrees of home repairs that can increase the value of your home. Cosmetic fixes like improving your landscaping will do wonders for your curb appeal. Painting and decluttering help to present the home in the best light for buyers. Larger projects like replacing appliances, roofing, plumbing, and full-scale upgrades are a more significant investment but can increase your home’s value.

4. Staging costs

During the selling process, it pays to put effort into the presentation of your home. Staging helps buyers to visualize living in the home. Professional stagers will enhance your home’s qualities while minimizing its deficiencies. Their cost will depend on the level of staging your home requires.

5. Utilities

In the interim period between when you move out and the buyers move in, you’ll want to continue paying utilities. Without running water, electricity, and heat, your home could be difficult to show to buyers.

6. Remaining mortgage

Another cost of selling your home is the remaining loan balance on your mortgage. If you have been steadily paying your mortgage, your home sale will greatly aid in paying back the remaining amount, if not cover it completely.

7. Escrow fees

In a home sale, there’s always the question: Who handles the cash? That’s where escrow comes in. It’s common for buyers and sellers to split the cost of escrow services. Be mindful of additional costs during escrow such as transfer fees and notary services.

8. Capital gains tax

The capital gains tax is assessed by taking the difference between what you paid for your house and what you sold it for. There are common exclusions for the tax, but there are situations where the exclusions may not apply. For example, if the home was not your primary residence, you could end up paying taxes on the whole gain. Talk to your Windermere agent for more information.

9. Property tax

If your home sale takes place after you’ve paid taxes for the year, you may get a rebate at closing. In this case, the buyer reimburses the seller for the applicable taxes paid. Otherwise, the seller should pay the prorated share of property tax until the sale closes, placing the money in escrow.

10. Moving costs

Finally, the home sale is final, and you’re ready to move. Whether you’re moving locally or across the country, moving costs can add up quickly. Moving as many of your items yourself can save money, but for larger, more difficult to transport items, you’ll likely need to incur the cost of hiring professional movers to ensure your items arrive at your new home safely.

 These are just some of the costs associated with selling your home. Each home sale is different, and the costs vary accordingly. Knowing what you can expect to spend throughout the selling process will help you budget accordingly.

Buyers & SellersColorado Housing August 20, 2020

Empty Nesters: Remodel or Sell?

Empty Nesters

Your kids have moved out and now you’re living in a big house with way more space than you need. You have two choices – remodel your existing home or move. Here are some things to consider about each option.

Choice No. 1: Remodel your existing home to better fit your current needs.

  • Remodeling gives you lots of options, but some choices can reduce the value of your home. You can combine two bedrooms into a master suite or change another bedroom into a spa area. But reducing the number of bedrooms can dramatically decrease the value of your house when you go to sell, making it much less desirable to a typical buyer with a family.
  • The ROI on remodeling is generally poor. You should remodel because it’s something that makes your home more appealing for you, not because you want to increase the value of your home. According to a recent study, on average you’ll recoup just 64 percent of a remodeling project’s investment when you go to sell.
  • Remodeling is stressful. Living in a construction zone is no fun, and an extensive remodel may mean that you have to move out of your home for a while. Staying on budget is also challenging. Remodels often end up taking much more time and much more money than homeowners expect.

Choice No. 2: Sell your existing home and buy your empty nest dream home.

  • You can downsize to a single-level residence and upsize your lifestyle. Many people planning for their later years prefer a home that is all on one level and has less square footage. But downsizing doesn’t mean scrimping. You may be able to funnel the proceeds of the sale of your existing home into a great view or high-end amenities.
  • A “lock-and-leave” home offers more freedom. As your time becomes more flexible, you may want to travel more. Or maybe you’d like to spend winters in a sunnier climate. You may want to trade your existing home for the security and low maintenance of condominium living.
  • There has never been a better time to sell. Our area is one of the top in the country for sellers to get the greatest return on investment. Real estate is cyclical, so the current boom is bound to moderate at some point. If you’re thinking about selling, take advantage of this strong seller’s market and do it now.

Bottom Line

If your current home no longer works for you, consider looking at homes that would meet your lifestyle needs before taking on the cost and hassle of remodeling. Get in touch with a Windermere Real Estate broker to discuss the best option for you.

Buyers & Sellers February 3, 2020

Kick-Starting a Kitchen Remodel

Ask a homeowner which room they would most like to improve, and most will point to the kitchen – the starting point for every meal and the heart of the home.

Ask those same people why they don’t move forward with a kitchen remodel, and many will say the project seems so overwhelming they don’t know where to start. If your kitchen needs an upgrade, here are some step-by-step suggestions to get you started.

 

Gather your thoughts

The steps that follow will all progress much easier if you take time beforehand to form a strong opinion about the desired look and layout of your new kitchen.

 

Start by reviewing kitchen magazines and photo-heavy kitchen remodeling guides and/or websites. Compiling clippings and printouts in a notebook helps you refine your vision. Clip or print the photos that capture your imagination, add notes, and draw circles and arrows around the things you like most.

 

Once you have a clearer vision of what you want, search online for better examples and new solutions, if necessary. If you live with a significant other, share your ideas with them and don’t allow yourself to become too committed before getting buy-in from them. Contractors and sales associates will expect a unified front.

 

Focus on the flow

Another major factor you’ll want to consider is how your new kitchen will be used, and by whom:

 

  • Do you want to cook with others?
  • Do you want family and guests to gather in the space while you cook?
  • Do you want to serve meals in the kitchen?
  • Do you want to display your dishware?
  • Where would you like things stored for maximum efficiency?

 

Imagine yourself happily cooking and entertaining in your new kitchen, then note the key elements necessary to make those dreams a reality. Having a list of your desired kitchen features and storage needs will help ensure your plan meets your vision.

 

Determine your budget

According to the annual Remodeling Magazine survey of costs, a “midrange,” “minor” kitchen remodel will cost homeowners living on the West Coast about $23,000. Those same folks can expect to pay about $70,000 for a midrange “major” kitchen remodel. Determine what you can afford before you start work to ensure that your vision is within reach, or to help prioritize what’s most critical.

 

What to do with the cabinets

Replacing the cabinets is one of the most expensive improvements you can make in a kitchen remodel (typically consuming 20 to 40 percent of the overall budget, according to Architectural Digest).

 

Consider refacing instead. This can include one of the following: 1) Installing completely new cabinet doors and drawer fronts or 2) installing new wood or laminate veneer over the existing cabinet and drawer fronts or 3) simply refinishing the existing cabinet and drawer fronts.
Shopping for contractors

The contractor you choose will determine much of the cost, the pace of your project, the amount of disruption, the final results, and your level of satisfaction. So be thorough in your search:

 

  • Ask friends and family for referrals and advice.
  • Interview at least three of the leading prospects in-person.
  • Ask to see samples of past work.
  • Look for someone who complements your operating style (similar personality and communication style).
  • Once you’ve narrowed your choice to one or two, ask to speak with a few past clients.

 

You’ll be tempted to latch onto the first contractor who gets rave reviews from a friend or family member. But remember: You and your project are unique, and it’s worth the time and effort to be rigorous in your search.

 

Selecting appliances

If you’re planning to replace appliances, here are three factors you’ll want to consider:

 

Finish – Stainless steel is still the most popular option, but beware: smudges, fingerprints, water spots, and streaks will be obvious. Black stainless steel has a warmer feel and is better at hiding spots.

 

Extended warranty – According to Consumer Reports, extended warranties are hardly ever worth it because today’s appliances are so reliable. And if something does fail, it’s often less expensive to just pay for the repair.

 

Unbiased testing and reviews – Before making an appliance purchase, use the information resources available through Consumer Reports.

 

A final note

Moving walls and extending your home’s foundation are both very expensive options. If your kitchen plans call for these architectural renovations, perhaps you’ve outgrown your home and need something larger (with an already-improved kitchen).

Blog April 19, 2019

How to Cover Unexpected Costs with a Personal Loan

Posted in Buying and Living by Guest Author 

By Jennifer Calonia

Owning a home comes with its rewards — it’s an investment, a cozy haven to kick-up your feet after a long day of work, and a welcoming place to bring family and friends together. Although all of this makes homeownership fulfilling, owning a home also opens the door for unexpected (but necessary) expenses.

If you’ve suddenly been hit with a home improvement project that’s pinching your budget, like a roofing issue or heater malfunction, a personal loan might be an option to help cover the cost.

What is a personal loan?

A personal loan is an installment loan that’s typically issued by a bank, credit union or online lender. According to the Federal Reserve, the average interest rate on a two-year personal loan is 10.70% but varies depending on your credit score and other criteria. Some lenders offer repayment terms anywhere from 12 months to five years.

A benefit of using a personal loan for emergency home improvement projects is that the approval process is generally quick so you can address urgent home repairs sooner. Some online lenders can run a credit check, approve your application and send funds your way with a couple of days. The approval process for banks and credit unions, on the other hand, can take anywhere from a couple of days to a couple of weeks, if the lender needs additional information.

How to find a personal loan

If you’ve decided that a personal loan makes sense to fund your next home project, make sure you’re aware of these next steps.

1. Assess your budget

The last thing you need is taking out a personal loan only to realize after the fact that you can’t afford to repay it. Calculate how much you realistically need for your home improvement project, giving yourself a reasonable buffer for unforeseen repair expenses (e.g. permit fees, price changes for a specific material, etc.)

Then, tally your monthly income and financial obligations to ensure you still have enough cash on hand to keep the lights on and make monthly installments toward your loan. Using a spreadsheet or budgeting app can help you track these numbers easily.

2. Know your credit score

Generally, you need a good credit score to get approved for a personal loan. Your credit score is one of the key factors that lenders use to determine whether your application is approved, and a higher credit score results in a lower interest rate offer.

Check your credit score with the three credit bureaus to ensure there isn’t an error or suspicious activity that might inadvertently lower your credit score. For a free credit report, go to AnnualCreditReport.com to see where your credit stands before moving forward in the process.

3. Compare rates and terms

When you’ve confirmed that you have a good credit score that can get you competitive interest rates, it’s tempting to accept a loan from the first lender that approves you. But like other major purchases, it’s important to shop around.

Compare interest rates, annual percentage rates (APR), and term durations available, and read the fine print for any conditions or fees that might offset any benefits.

To start, try reaching out to your existing financial institution first to see what they can offer; sometimes credit unions, in particular, offer rate incentives for loyal members. Also, consider using a personal loan aggregator website to compare offers from multiple online lenders at once (just do your due diligence to ensure the site is legitimate).

4. Submit an application

If you’re ready to submit an application, you can either complete a form online or apply in-person, depending on your lender. Although all lenders require different information to process a loan application, some common information to prepare ahead of time include:

  • Personal information
  • Income
  • Employment information
  • Reason for the loan
  • Amount you want to borrow

To minimize any delays on your end, it’s helpful to prepare copies of verification documents, such as a driver’s license, proof of address like a utility statement, information about your home and pay stubs. Your prospective lender will likely reach out to you if they need any other information to make a decision.

Although it’s always best to have emergency savings set aside for a sudden home improvement project, turning to a personal loan is a useful option when you’re pressed for funds and time. As urgent as your project might feel, however, always take the time to do your research to ensure you’re making the right move for your situation.

 

Jennifer Calonia is a native Los Angeles-based writer for Upstart whose goal is to help readers get excited about improving their financial health and lifestyle. Her work has been featured on Forbes, The Huffington Post, MSN Money, Business Insider, CNN Money, and Yahoo Finance. When she’s not wordsmithing, you can find her outdoors, exploring state and national parks.

BlogFor Sellers April 3, 2019

How to Create a More Beautiful and “Sale” Ready Home

When you love your home but want to make some changes, how do you know where to begin? As a real estate broker and advisor to my clients, I am often asked what improvement projects are most worthwhile or where money is best invested.

RGN_1In today’s market, I am consistently seeing that buyers are looking for the “cream puff” listings. They want a home that is well maintained, “move in” ready, priced well, and in a good location. No surprise there, right?

As I work with clients, whether they are preparing to move now or just looking to improve their home for their own enjoyment, I find a few things that consistently show rewards in the end.

Beginning with maintenance items such as roofing, siding, paint (both interior and exterior), windows, and a couple secret weapons that are often overlooked, which offer a huge impact and are more reasonably priced than you may think, are new garage doors and outdoor fixtures. Remember you never get a second chance to make a first impression!

Outdoor living areas have become all the rage by giving the homeowner an opportunity to add additional entertaining space to their home. The options here are endless depending on your budget and amount of space you have to work with, but this can be a great way to improve the function and finish of your home.

Take a minute to ask yourself, where do I spend most of my time in my home? Kitchen, kitchen, kitchen! We all love to eat and hang out in the kitchen. As a result, improvements here are always a good place to start.

RGN_2

 

Owner’s bedroom suites and bathrooms are also very popular areas for improvement.  The range of options for these areas is vast based again on size and budget.

Consider replacing hard surfaces, base and trim, fixtures, and doors. Think outside the box and ask an expert for help choosing something that might set your home apart. Why use the same six-panel door that everyone has? Change it up a bit. Starting with the solid bones using neutral tones and embellishing with accessories to add a splash of color and your own flair is always a winner!

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The more open, clean, and well maintained your home is, the greater your return on your investment will be. Buyers in today’s market have access to an abundance of information and have a good eye for short cuts. Work done just to “flip” a home will be called out very quickly! Always ask a professional for advice. You will find your favorite contractor or real estate professional will be more than happy to spend some time helping you make educated decisions that will meet your needs and show long term return.

RGN_4By Aimee Shriner

Windermere Real Estate/Northeast Inc.

Kirkland, WA

Orignially posted on RGN Construction’s blog.

All photos are from www.rgncon.com