9 Costly Mistakes to Avoid When Placing Your Home For Sale - Part Two
Not taking into account all the possible costs
For most of us, selling and buying property isn’t something that we do very often and over time, things do change, especially where potential costs are involved.
It is far better to OVER estimate the potential costs and UNDER estimate the sale price when working out your finances, after all, isn’t it better to be pleasantly surprised when something costs less than you had planned or you end up selling for more than you expected?
What are some of the potential expenses?
This is a quick checklist of some of the things that could cost you money that it would be wise to see if they might be applicable to your situation.
Tidying up your home and gardens prior to marketing.
Repairs that should be done (not renovations).
A Land Information Memorandum (L.I.M.) report.
Council files check.
Builders inspection report.
Solicitors costs and conveyancing charges.
Packing and removal costs.
Rates, power and phone disconnection/re-connection charges.
What’s the priorities?
Check with your solicitor and ask for their current fees for carrying out the conveyancing and discharge of mortgage?
It can pay to check around as a simple conveyancing, for example, one mortgage discharge and no new mortgage, is a reasonably straight forward transaction and you can save money by shopping around.
Banks will usually charge an early repayment fee if you are on a fixed mortgage, so make sure you check with your bank as those fees can be quite a lot if you have a long period left on the fixed term.
The Building act has changed quite a lot since 2003, and that combined with the leaky homes issue, the Canterbury earthquakes and banks and insurers requiring some certainty now that any home is both structurally sound and has all the necessary permits, there is a lot of focus now on any work that has been done on a property at any time, whether you have done it or a previous owner.
So don’t wait for a potential purchaser to find out that there is something that needs to be remedied and risk losing a potential sale or having a purchaser wanting a large discount off the sale price to do the work themselves.
Getting a L.I.M from your council could be the best investment you could make to protect your future sale, finding out what might need attention before it becomes a sticking point with a purchaser can speed up the sale and give you more money in your pocket.
What about renovating the kitchen etc?
Don’t spend large amounts of money on redecorating or renovating without consulting your local real estate agent beforehand, you could, for example, spend $5,000 for a lovely new kitchen to replace the old one (which needed replacing), but a purchaser won’t pay an additional $5,000 just because you have spent it, they will see that as an added reason to buy your property over another similar one, but you probably won’t recoup what you have spent.
There may be occasions when it is necessary, but please check before you spend money that you might not recover or risk having to ask too much for your property that buyers won’t make an offer.
Author, Graham Lester
Maggie Dixon Real estate