8 Steps to Selling Real Estate

These 8 steps are relevant to all property owners wanting to sell their property, regardless of whether they are selling privately or through a real estate agent. The success of the sale of a property is dependent on how well each of the 8 steps are performed. Once you have read and understood each step start planning how you will undertake each of them in the selling process.

Step 1 – Property Appraisal
To effectively prepare and market your property for sale you need to perform a property appraisal. A property appraisal is a private document outlining the positive and negative features of the property. This appraisal will enable you to focus your marketing on the positive features while developing strategies to overcome the negative aspects of your property. The property appraisal will also help you decide the market value and listing price of your property as discussed in the article on Property Pricing.

The property appraisal can be performed by yourself or alternatively you can contact an agent who can complete this for you (be aware that after the appraisal the agent will continue to contact you in an effort to gain your listing). This article on Property Appraisal provides an easy step by step guide on how you can perform a successful property appraisal for your property.

Step 2 – Legal Obligations
All properties which are offered for sale require a Contract of Sale. A Contract of Sale is a legal document which must be available for potential buyers to read when they inspect your property. We strongly recommend that you seek the services of a Solicitor or Conveyancer to prepare the Contract of Sale and oversee the signing of the contract along with the settlement of the property. Alternatively, there are online conveyance services available which you can use to create the Contract of Sale yourself.

You are also legally obliged to inform your mortgage provider of your intention to sell your property. We recommend that you also inform your insurance provider that you are planning to sell your property as you need to ensure that your property is covered by insurance during the sale process.

Step 3 – Preparing Your Property
Making sure a property is presented professionally is an essential aspect in the sales process. You need to look at the property through the eyes of potential buyers and evaluate which features of the property they will find most attractive and which features they are likely to find unappealing. Sellers must learn to highlight and emphasise the attractive features and improve upon or minimise the exposure of undesirable features. For a comprehensive guide on how to professionally prepare your property for sale, read this article on Property Preparation.

Step 4 – Pricing Your Property
Setting the correct listing price for a property is an extremely important and strategic part of selling a property. As an owner you must decide the best possible price for your property, without overpricing or underpricing the property. Determining the correct listing price is critical to efficient property sales for the following reasons:

• If a property is overpriced it won’t sell and will sit on the market for an extended period of time costing you an increasing amount of money.
• An overpriced property will scare away potential buyers and narrow your target market.
• If the price must be reduced after a period of time, buyers will realise that the property was overpriced which will undermine your bargaining power .
• If a property is under priced it will sell quicker but you will be forgoing valuable profit.

This article on Property Pricing outlines the steps involved in you successfully estimating the market value of your property and selecting the best listing price.

Step 5 – Advertising & Marketing
One of the biggest mistakes property owners make when attempting to sell real estate is not having an effective advertising and marketing strategy for their property. You don’t need to spend an exorbitant amount of money on advertising. Property sellers instead need a marketing strategy which provides the most exposure in a cost effective way. A combination of a For Sale sign, internet advertising, and marketing material including letter box flyers, brochures and e-brochures are the most successful and cost effective means at your disposal.

This article on Advertising & Marketing provides a summary of advertising and marketing techniques which are commonly used in the real estate industry.

To read about how to prepare yourself and your property for inspections read this article on Property Inspections.

Step 6 – Negotiating the Sale
The negotiation of the agreement of sale includes the negotiation of the terms of offer which consists of the price, any special conditions and the proposed settlement date for the sale. For further details read this article Negotiating the Sale which provides a brief explanation of the process and a few tips to successfully undertaking this important step.

Step 7 – Exchange of Contract, Deposit & Cooling Off Period
Once you and the purchaser have decided on the terms of sale, your solicitor will draft any special conditions that need to be included in the Contract of Sale. Both party’s solicitors will then oversee the signing and dating of the Contract of Sale by you and the purchaser. Each party will then be given a signed copy of the Contract of Sale.

The purchaser is now required to pay a deposit for the property which will usually be held in your solicitors trust account. The deposit is usually 10% of the sale price but is often negotiable depending on the cooling off period selected.

After the Contract of Sale has been exchanged the buyer usually has a cooling period during which they can retract from the Contract of Sale. Each state has different rules relating to Cooling Off Periods which can be found at your state or territory regulatory body.

Step 8 – Settlement
Prior to settlement the buyer will perform all formal inspections including completing a building/pest inspection report to ensure the property is per the Contract of Sale. The settlement date is usually between 30 to 45 days after the exchange of contracts but is negotiable. On the day of settlement the buyer will perform one last inspection of the property making sure everything is as per the Contract of Sale. If the buyer is happy with everything theywill then provide you or your solicitor with a cheque for the remaining amount of money owed on the property. Transfer papers will then be exchanged and the buyer will be given the keys to the property.

Disclaimer: All information provided in this blog does not come with any guarantee in relation to its accuracy. This is our opinion in relation to issues relating to the real estate industry. Privatepoint or its employees will not be help liable for any liabilities, expenses, losses, damages or costs, that may be incurred by you or a third party as a result of or in connexion with use of this information.