There are a million different reasons why people sell their homes, but every seller has one thing in common: the desire to get as much money as possible from their existing residence as quickly and as hassle-free as possible. (If your home is your principal residence, you won’t have to pay capital gains tax on any profits from the sale. If, on the other hand, it is an investment property, prepare for the tax man!) Before you begin the selling process, really evaluate why you’re moving. Do you have too few rooms, or too many? Has your job moved to another city and you’re relocating? Are the neighbours driving you away? Or are you simply looking for a change? A complete analysis of your current position will set a good foundation for your next home hunt.
When is the Best Time to Sell Your Home?
Everyone seems to have specific ideas on when the right time is to sell. Some base their theories on theoverall economy, while others will tell you that there are key buying months that you’ll want to capitalize on. If you’re not buying and selling strategically or for investment, the best time to sell is really when you feel your existing home will not meet your future needs. The best reason to purchase a new home is to take advantage of your family and lifestyle changes. Do you wish to be closer to a school? Are you switching jobs? Do you have an aging parent to care for? In Canada, weather and holidays do play a factor. Almost no one goes house hunting around Christmas, and few give up their summer vacations. Of course, those with school-aged children are less likely to move during the school year and summer is an ideal time. In some areas, there is a definite “spring cycle” — perhaps it’s a bit of spring fever and a wish to break out of the bonds of winter. Some gamblers look for winter bargains and then try to sell their homes during the spring cycle. But overall, that could be more tension and aggravation than you wish. And the monetary results may be disappointing. Another key factor to consider is the economy. Are interest rates higher or lower in comparison to your current mortgage? If they are higher, you may want to stick with your current home, as your new mortgage payments could be uncomfortable. If rates are lower, you might be able to trade up to a more expensive home without a significant increase in your monthly mortgage obligation. What’s more, if it’s a buyers’ market, you may be in a strong position to purchase a new home, especially if you have accumulated some equity in your current property.
Are There Costs Involved in Selling?
Unfortunately, the answer is yes. Even if you think your home is perfect, you may have to do some minor repairs or upgrades to make your home more attractive to potential purchasers.
A professional home inspection may be a condition of the offer. If the inspection points to problems, your purchaser may ask that you make the necessary repairs or choose not to close the deal.
Closing costs, such as lawyers’ fees or unpaid taxes, will also have to be paid.
Mortgage discharge fees may be levied by your lending institution.
Sales commissions must be paid as defined by your listing agreement.