Selling your home can be daunting, even more so if you are looking to buy a property at the same time. The decisions you make when selling a property could save you or cost you thousands of pounds. Look at our step by step guide to help you make the right decision for you.
Decide if you should sell
- If you’re considering selling your home and buying another because you need more space, it could be worth comparing the cost of building an extension, converting the attic, or digging out the basement? The costs of selling and costs of buying can be significant (particularly with stamp duty) that it might even save you money to expand your existing home rather than move
- Perhaps you are thinking about downsizing? Weigh up the pros and cons and include any costs involved
- Depending upon your circumstances, you might be better off renting your home rather than selling. Sometimes, it can make practical or financial sense to keep the old home. If you rent your old house out rather than sell it, you could end up over time with a valuable asset that generates a regular income
Figure out your finances
- Before you sell your house, you’ll want to get a rough idea of how much it is worth. This will also help you calculate how much money will be left if you have a mortgage to pay off. Most agents offer a free valuation service. It may be wise to get more than one to ensure you are getting the most accurate information.
- Dig out your mortgage paperwork or speak to your lender to check if you will have to pay any early repayment charges for switching your mortgage to another lender or whether it is possible to take it with you to a new property.
- If you’re planning to move to a more expensive property or your mortgage deal is coming to an end, this is a great opportunity to remortgage to a better deal.
- At the early stages, figures will be approximate. You don’t know how much you will sell for and you will only get a precise redemption (amount outstanding) figure for your mortgage once you have an agreed completion date when you have exchanged contracts.
- Work out the costs involved in selling your property. You will need to consider Estate Agent fees for selling your home, the cost of an Energy Performance Certificate (you cannot sell your home without a valid certificate) and removal fees.
Decide on your next move
- Selling your home and renting for a while can add to the overall expense, but it will reduce the critical time pressures in buying a new home
- You also won’t have to compromise on your sale price, and potentially sell your home for less, as you won’t be under pressure to complete on your onward purchase
- You won’t be rushed into buying a less-than-perfect new home because you have found a buyer for your current home
Selling your property and then renting before buying will break the housing chain which means you will be a more attractive buyer
Choose an estate agent to sell your house
- You can sell your home yourself or use an Estate Agent.
- If you use a local estate agent, you will need to research which one to choose.
- Find the best local estate agents based on how quickly they sell, success rate and likelihood of achieving asking price.
- You will need to agree a fee with the estate agent: aim for 1% plus VAT for sole agent.
- Online estate agents tend to be a cheaper option when selling a house. However, be careful to check if there are any hidden add ons or charges.
- When it comes time to appointing an estate agent, read your contract carefully.
- If you have time and are organised and willing to work hard, then axing the estate agent and selling your home yourself can save you money. But it’s not for the fainthearted – or inexperienced
Get an Energy Performance Certificate
- An energy performance certificate (EPC) is a standardised document which ranks properties in terms of energy efficiency. Homeowners need to provide an EPC to potential buyers when they sell their home
- You have to have at least applied for an Energy Performance Certificate before you put your home on the market. https://www.gov.uk/find-energy-certificate
Decide how much to sell your home for
- One of the most agonising decisions when selling your home is what price to put it on for
- Do your research and get to know the local market inside out
- Get a number of estate agents to do valuations, but don’t necessarily go for the highest.
- Remember buyers will probably try to negotiate a discount, so add 5% to 10% to what you are prepared to accept
Prepare your home for sale
- If you “stage” your home well, you are not only more likely to sell your home faster, but you might make it more valuable too
- Tidy up, get rid of excess clutter; give it a fresh lick of light coloured paint; fix those little snagging things; keep it clean
- Don’t forget how important your home’s kerb appeal is. Kerb appeal can be very important in buyers choosing to buy a home.
Accept an offer
- You’ve received an offer – hooray! The estate agent is legally required to pass all offers on to you
- If you are not happy with the offer, you can either reject it outright, wait to see if a better offer comes along, or tell the estate agent to try to negotiate it upwards
- Once you are happy with an offer, you need to formally accept it.
- Remember that accepting an offer is not legally binding, and you can legally change your mind or accept a higher offer later (gazumping) – but remember, this can be pretty distressing to the buyer
Hire a conveyancing solicitor
- You need to choose a conveyancing solicitor to handle the legal work involved in selling a property.
- To ensure the sale progresses, you should decide which firm you want to use before you agree to the sale of your house. You can obviously only formally instruct after you have agreed an offer
- Get an overview of how much conveyancing costs are.
Fill out the relevant questionnaires
- You will have a variety of forms, questionnaires and documents to give the buyer all the information about the property, and about the sale.
Negotiate the draft contract
You and the buyer will have to decide:
- The length of time between exchange and completion (usually 7-28 days after the exchange of contracts)
- What fixtures and fittings will be included – and how much will they pay for them
- Any discounts due to problems flagged up by the survey
- When you exchange contracts with the buyer, you become legally committed to selling the property – and they are legally committed to buying it from you
- If you pull out after this without due reason, the buyer’s deposit will be returned to them and you may be sued
- If you sell a house, you are responsible for looking after it until the sale is completed
- You can move out whenever you like, including on the day of completion
- It is less stressful to move out beforehand, if that is possible (if you have somewhere to move to)
- At the time of completion, the property has to be in the condition agreed in the contract including all the fixtures and fittings
- The buyer and estate agent may come round between your moving out and completion to ensure that everything is in place
- Find the right removals company for your move and get removals quotes
Complete the sale
- Completion is when the property changes ownership, you accept payment, and hand over the keys
- A little like a duel, it takes place on a previously agreed date and usually at midday
- On the day of completion, the money is transferred and any deeds for the property are transferred between each side’s solicitor or conveyancer
- Your solicitor/conveyancer will register the transfer of ownership with the Land Registry
Pay off the mortgage (If necessary)
- The mortgage company will have given you and your conveyancing solicitor a precise redemption figure (outstanding amount) for your mortgage for the day of completion
- Now the buyer has transferred the money to your conveyancing solicitor, they will pay off the mortgage for you
Settle up remaining costs
- After completion, your conveyancing solicitor will send you an account, covering all their costs and disbursements, as well as the sale price of the house and redemption of the mortgage
- If you are buying and selling at the same time, the conveyancing solicitor can settle up for both transactions at the same time, including paying stamp duty for the house you are buying
- Your conveyancing solicitor will ensure that the change of ownership is registered with the Land Registry
- There is sometimes a small discrepancy and you might even get a small refund