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| This Guide is intended to explain the typical steps
involved in selling a property. The Guide is free to everyone, not
just customers of Remaxpropertywealth.net. After reading it, you should
have enough knowledge to handle your sale with confidence. |
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Where do I start?
The first step is to appoint some professionals to help you. Unless
you are prepared to pay for your own advertising and promotional
material, this means choosing an Estate Agent to value and market
your property for you, and appointing a Solicitor to handle the
legal side of the sale. If you are planning to buy another property,
you may also wish to speak to a Financial Advisor about mortgage
options.
Many people forget to appoint a Solicitor until a firm offer from
a potential buyer suddenly jolts them into action. But there are
several things a Solicitor can do to help prepare for a speedier
sale. And experience shows that it's a good idea to be ahead of
the game, especially if you are buying another property at the same
time. This is covered elsewhere in the Guide. |
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Do I really need an Estate Agent?
This depends on whether you have the expertise, time, patience
and resources to do it yourself. Estate Agents don't charge you
a penny unless they sell your property. You only pay for results,
and a good Estate Agent will draw in more potential buyers than
you would otherwise be likely to attract.
There is also the convenience of having someone else to field calls,
to weed out time-wasters, and to act as a go-between in tricky negotiations.
An experienced Estate Agent can offer advice and expertise, too,
if you have problems with a chain, say, or receive multiple offers.
The Agent will have seen these many times before, and be able to
handle things to your best advantage.
Remember: no up-front payment is required with Estate Agents. And
the Estate Agent you appoint will be working for you (the Vendor),
not for your eventual Buyer. This is worth keeping in mind if you
are buying another property at the same time: the Estate Agent's
chief duty is to the Vendor - who will eventually be paying his
or her fee - and not the Buyer. |
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How does an Estate Agent arrive at a
realistic valuation?
An Estate Agent will visit you at your property to have
a look around, and carry out what's known in the industry as a Competitive
Market Analysis (CMA). This costs nothing, and is based upon a number
of criteria:. General market demand from Buyers
. The popularity of your area (shops, schools, transport etc)
. Current asking price of similar properties nearby
. Prices recently achieved for similar properties nearby
. Significant works/improvements carried out to the property
The CMA will give you an 'estimated market value'. From this, you
can decide on the price at which to market your property. Agents
do not charge for their valuations.
The Estate Agent will probably ask you a lot of questions. Don't
be put off. This is the mark of a professional Agent, who may ask
you for your desired moving date, your reason for selling, and so
on. Some people are wary about telling the Agent how quickly they
want to sell in case it lowers the valuation. But a good Agent will
tell you a minimum and maximum price they could achieve.
Be wary of any Agent who just asks you the price you want for your
property and agrees. The Agent should be able to demonstrate why
they think your property could achieve their stated valuation price.
They may be able to quote selling prices they have achieved for
similar property in the area, or have a Buyer on the books who wants
a property much like yours. But ensure this is genuine: a few agents
may use this tactic! |
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I've had several valuations. Which Estate
Agent do I choose?
Do some research on the Estate Agents you invite to value
your property. When you telephone them, do they answer swiftly and
politely? When you visit their offices, are you made to feel welcome?
Little things like this can have a big effect on potential Buyers.
Sometimes people immediately plump for the Agent who values their
property much higher than any others. But it's a good idea not to
be swayed by valuation alone. If a valuation is exaggerated, you
could waste weeks of time while your property languishes on the
market, unsold. It's not unknown for an Agent to call you in a few
weeks to suggest the property be marketed at a lower value. Remember,
too, that you are employing a whole firm, and not just the person
who came and valued your property.
Your gut instincts aside, here are some marks of professionalism
that you may want to look out for:
. Polite, friendly and well-trained staff.
. Bright colour photos of properties in an attractive window
display.
. Clear and helpful advice literature.
. High profile in the area.
. Efficient, computerised administration system.
. Comprehensive marketing e.g. newspapers, signboards, leaflets,
Internet.
. Membership of the National Association of Estate. Agents
and Estate Agents Ombudsman Scheme.
Also, if the Estate Agent has a web site where they can market
your property online, so much the better. Potential Buyers all over
the world can now view details of property for sale simply by hitting
a few keys on their home computer. Why wait for details to arrive
in the post, when they can have instant access to Estate Agents'
filing cabinets from home, 24 hours a day?
The leading Estate Agents in this field have developed sophisticated
search facilities within their web sites, allowing buyers to search
by specific criteria (e.g. "two-bedroom flats with garage,
between ?130,000 and ?145,000"; "three-bedroom houses
with garden in Kennington" etc.), and to view full details
with colour photographs. This will become an increasingly popular
way of finding property. For an example of how your house or flat
might appear on use the property search section within this web
site. |
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Should I go for a 'Sole Agency' or
'Multi-Agency' agreement?
The jury is still out on this one. You might think that
instructing three Agencies would give you three times as much chance
of finding a Buyer for your property. But in practice, the same
buyers will go to all the Agents anyway - and may even get the impression
that your property is hard to sell, if they see everyone advertising
it. On a practical level, dealing with several Agents can be time-consuming.
And - perhaps most significantly - it is likely to be considerably
more expensive to go for the 'Multi-Agency' option, rather than
picking just one.However, in some cases it may be wise to instruct more than one
Agent. For example, if you have an unusual or rather grand property
that stands out from others in the area, you might want to market
it with both a local Agent and one in another area which buyers
may more readily associate with your type of property. There again,
an isolated property in the country might be considered as a possible
'weekend retreat' for London workers, say. So, in addition to marketing
the property locally, it could be worth appointing a London Agent
who would attract such Buyers.
Warning: You will find that most agreements include a clause that
states that the Vendor must pay the Sole Agent their fee even if
the property is sold to a Buyer introduced by another Agent. This
is standard practice, intended to protect the Agent against spending
considerable time and money on marketing a Property, only to find
that the Vendor has instructed another Agent. Read the agreement
carefully to minimise any exposure to extra fees. |
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How much do Estate Agents charge, and
is this negotiable?
An Estate Agent's fee tends to range from 1-3% of the total sale
price, and is paid on completion. 'Sole Agency' deals (where you
only instruct one Estate Agent) tend to be significantly cheaper
than 'Multi-Agency' deals.
When there is a shortage of property on the market, you will find
Agents offering to match or beat a competitor's fee, and cut-price
offers appear in the property newspapers. You may be able to negotiate
a favourable deal. In steadier times, most agents charge around
2%, but the service they offer is likely to vary considerably.
A higher fee is worth paying if the Agent has the experience and
ability to get you the maximum price within a reasonable time. For
example, let's say an Agent charges a fee of 1.5% to sell your flat.
If he achieves a final selling price of ?100,000, the fee will be
?1500. Now, suppose another Agent charges a fee of 2%. If he finds
a buyer prepared to pay ?105,000 for your flat, the fee will be
?2100. But you will still be ?4400 better off than taking the "cheaper"
option.
Choosing the cheaper Agent is a mistake if they don't get results.
An Agent who has to carry the cost of well-maintained premises,
experienced staff, efficient computer systems, and professional
advertising is truly earning their fee.
And it's worth saying again: "No Sale - No Fee". A bonus
to the seller. |
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What difference do professional Estate
Agency bodies make?
Anybody can set up tomorrow and start trading as an estate agent
- no qualifications are needed. Nevertheless, there are two main
professional associations for the Estate Agency profession: The
Estate Agents Ombudsman Scheme (OEA) and National Association of
Estate Agents (NAEA). Membership of these bodies is voluntary. By
being a member, the Agent demonstrates to you that they are prepared
to operate by professional standards laid down by these associations
-The Estate Agents Ombudsman Scheme (OEA):
This provides an independent service for dealing with disputes
between member Agencies and consumers buying or selling residential
property in the UK. The Ombudsman is independent, and undertakes
to offer a free, fair and speedy review of complaints that fall
within his remit. Further information is available from the Ombudsman
for Estate Agents, Beckett House, 4 Bridge Street, Salisbury, Wiltshire
SP1 2LX. Tel: 01722 333306.
National Association of Estate Agents (NAEA):
Members are bound by rules of conduct, which have been drawn up
to protect public interest and are backed by a formal disciplinary
procedure. Members must be competent in Estate Agency law, practice
and ethics. The NAEA also offers a mediation service. The National
Association of Estate Agents, Arbon House, 21 Jury Street, Warwick
CV34 4EH. Tel: 01926 496800. See their web site at
www.naea.co.uk |
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What about choosing a Solicitor? How
much do they charge?
It may be that you already have a Solicitor who can handle
your sale. If not, ask your Estate Agent, friends and neighbours
if they can recommend one. If you happen to choose a Solicitor who
is recommended by your Estate Agent, communications between them
will probably be very good. The Solicitor and Agent are likely to
be in regular contact on a number of sales, so they won't waste
time chasing one another.
The Solicitor should be a specialist in residential conveyancing.
Fees start at about ?400 for a basic conveyancing service but -
as with Estate Agents - it may not be a good idea simply to go for
the cheapest deal. Solicitor's costs can mount up, so make sure
their charging structure is clear at the outset.
Ask what sort of service you can expect: will a Solicitor handle
your sale, or will it be a less experienced legal clerk? Does the
Solicitor have reliable systems for obtaining information speedily
from local authorities and financial institutions?
When you come close to "exchanging contracts" on a property
(the legally binding part of the sale process), speed is often of
the essence, particularly if you are also in the process of buying
another property. The last thing you want is to be held up by an
inefficient Solicitor.
Title deeds held with building societies or banks can take a little
time to come through, but choosing a 'fast-track' Solicitor will
mean that delays are minimised. Fast-track Solicitors start the
ball rolling as soon as they are instructed, so that a draft Contract
of Sale can be drawn up and sent to the Buyer almost as soon as
their offer is received. They will also ask you to complete a "Vendor's
Questionnaire", to provide information for your Buyer's Solicitor,
which should reduce the number of queries and replies that have
to be faxed back and forth between the two sides.
Ask your local library for a list of Solicitors who offer conveyancing
in your area. The Law Society (the professional body for Solicitors
in England and Wales) provides consumers with information about
dealing with Solicitors. The Law Society, 113 Chancery Lane, London,
WC2A 1EL. Tel: 020 7242 1222. |
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What can I do to increase the value
of my Property?
Generally Estate Agents will advise against major home
improvements. This is because you rarely recoup the cost of your
investment, and the Buyer may change it anyway. However, there are
a number of simple techniques that can help enhance interest in
your property:
- Give the front door a coat of paint
- Fill in and redecorate any cracks to walls and ceilings
- Put a lock on any rear gate
- Spring clean throughout the property
- Weed and clean up the garden
- Maximise a feeling of space - get rid of clutter
- Decorating may not be necessary - discuss with your Estate Agent.
- Make sure the shower works and is free from mould
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How should I prepare my Property for
viewings?
First impressions do count, and the following tips should help viewers
to appreciate your property at its best. Although you may be at
work when viewers are brought round, try to do whatever you can
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- Tidy up
- Air the rooms
- Hide clutter
- Vacuum clean and dust the main rooms.
- Give the bathroom sinks and baths a wipe over.
- Have some flowers in the main room.
- Fully draw back the curtains to get maximum daylight in the
rooms.
- On dull days, turn all the lights on and light any fire in the
main room.
- Turn the television and radio off (light music is fine).
- Close all windows that are affected by background noise (traffic,
trains etc).
- Banish off-putting smells with, say, the aroma of brewing coffee.
- Try not to let pets and children interrupt the viewing; keep
them occupied.
Bear in mind that potential buyers can sometimes be a bit later
than the viewing time arranged. With this in mind, when a viewing
is arranged (and you want to be there), be clear about the window
of time they have if you mean to go out afterwards. This will also
help discourage lateness. |
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What's the best way to conduct viewings?
There are no hard-and-fast rules here, but do:
- Agree with your Estate Agent who will conduct the viewing.
- Ensure you have all keys readily available
- Give time alone for viewers to discuss the property alone before
they leave.
- Resist the temptation to badger viewers for a decision or opinion
during the viewing
A good Agent will call you with feedback after every viewing.
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When I get an offer, should I take my
property off the market?
Your Estate Agent will probably advise you against this, just in
case the Sale falls through. Even if everything seems to be in order,
it's possible that after the survey, say, the Buyer may want to
negotiate on price and you cannot reach a deal.
On the other hand, if you leave your property on the market, your
Buyer may naturally feel somewhat aggrieved, since they may fear
they could be "gazumped" by a higher offer. If the Estate
Agent does get other offers, under Estate Agency law they are obliged
to put them to you. Whether or not you wish to pursue any additional
offers is your decision. To do so risks discouraging your Buyer,
who may pull out of the Sale and start looking at other property
as a result. If the latter is not convinced by your assurances that
you will not accept other offers so long as the Sale is proceeding
smoothly, you could also consider making a verbal or written undertaking
to take your property off the market for an agreed period of, say,
7-28 days, whilst surveys and mortgage finance are arranged by the
purchaser. |
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| How does the Sale proceed towards 'Exchange
of contracts'?
In general, the sale process goes something like this:
Your Solicitor prepares the contract of sale. For this, you will
need to have certain documents to hand. Please note that obtaining
these often causes delays, so it is in the interests of the Vendor
to chase them as soon as the property goes on the market. If your
property if freehold, you will require:
- Title documents (from you or your Bank/Building Society).
- Evidence of payment of last Council Tax (last 12 months).
- Paid utility bills.
- Guarantees and warranties related to damp proofing, etc.
- Gas safety check certificates.
- NHBC certificates.
- Planning and Building Regulations approvals for extensions etc.
- If your property is leasehold the documents will be as above,
except:
- Leasehold title deeds will replace title documents.
- A history of service charge payments.
- A history of ground rent payments.
Remember that it can take a while for Building Societies and Banks
to send some of these documents through. And until your Solicitor
has everything in their possession, progress is impossible.
Next, the draft Contract of Sale and a copy of the title deeds
(if the property is leasehold it will include a copy of the lease)
will be forwarded to the Buyer's Solicitor. The Buyer's Solicitor
will check the small-print of the contract, tit,e deeds, service
charges, and so on. This checking process may involve many specific
queries. A good Vendor's Solicitor will deal with many of these
in advance, by asking you to complete a 'Vendor's Questionnaire',
which may cover:
- Restrictions/boundaries.
- Owner's understanding of rights of access.
- Any disputes over the above.
- Guarantees/insurance policies e.g. NHBC.
- Utility services at property.
- Planning.
- Lists of fixtures and fittings.
- Exchange of contracts:
After settling any queries, the Buyer's Solicitor will also need
to obtain a satisfactory local search, and a copy of a mortgage
offer. Once satisfied, the contract will be signed and a cheque
for the deposit sent by the Buyer to the Vendor's Solicitors. Exchange
of contracts can then take place. Exchange means that the transaction
is legally binding.
At this point in the procedure, it is important that the Buyer
arranges building insurance cover for the property, as technically
the property comes under the Buyer's ownership.
Completion:
The final stage of the Sale is normally set 2-4 weeks from the
date of Exchange. On Completion, the Buyer's Solicitor hands over
the remainder of the purchase money to your Solicitor. From this,
your Solicitor will pay off the Building Society or Bank (if there
has been a mortgage on the property), as well as deducting their
legal fees, and whatever fee you have agreed with your Estate Agent.
And there you go. It's (sometimes!) as easy as that.
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How long should I give my Estate Agent
to sell my property?
You should allow an Agent 6-8 weeks to get a secure offer.
After this, it usually takes about 4-8 weeks for an Exchange of
contracts, and a further 2-4 weeks for Completion. Be aware that
time-scales do vary with market conditions. |
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What can I do to speed up the sale of
my property?
You can't always guarantee that other parties in the sale
won't delay you. On your part, however, you can speed things up
by doing as much of the work in advance of the Sale as possible.
. Choose a "fast-track" Solicitor who will obtain
and hold the Title Deeds in readiness to prepare a draft Contract
of Sale, and to apply for a Local Authority Search (see Question
8).
. Allow the Estate Agent reasonable access to the property
to show potential Buyers round. If possible, let them have keys
to show the property when you are out.
. Be flexible about last-minute viewings. |
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What happens if several Buyers put in
offers?
If you've already accepted one offer but wish to accept
another higher one, you should discuss this carefully with your
Estate Agent. It may not be worth gambling for the extra money at
the expense of time and uncertainty. What happens if the second
Buyer suddenly pulls out, or lowers their offer before Exchange
of contracts?
On the other hand, if several people are interested in buying your
property, your Estate Agent may suggest you try one of the following
techniques to be fair to all potential Buyers and still achieve
a good price:
Open bids ("Dutch auction"):
The Agent negotiates with each Buyer until they drop out, one by
one, and the highest offer is left on the table. This method can
achieve a high final offer from the Buyers most in a position to
proceed. But negotiations can get fraught and you could lose serious
Buyers if they get fed up and pull out.
Sealed bids:
Buyers are invited to submit their final offers in writing, and
the sealed bids are opened at a pre-agreed date and time. The highest
offer wins. This method is seen to be fair to all Buyers. As people
are casting their offers blind and have only one chance, they are
encouraged to put down the maximum they can afford. However this
system does not necessarily take into account which Buyer is in
the best position to proceed.
Contract race:
The Buyers are advised that the Vendor will sell to the Buyer who
can exchange contracts first. This avoids the Vendor having to choose
between Buyers. There is no risk of choosing a Buyer who does not
proceed, and of turning down others that might have done. However,
there is nothing to stop Buyers withdrawing, since the losing party
is left with Solicitor's and Surveyor's expenses to pay. |
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What if the Buyer reduces their offer
at the last minute?
As the time to Exchange Contracts approaches, your Buyer
may think you can be pushed into accepting a reduced offer (rather
than lose the sale, and having to go all the way back to Stage One).
It's important not to panic, get furious and call the Buyer yourself.
Instead, agree on a course of action with your Solicitor and/or
Estate Agent to show the Buyer that you'll not bow to such tactics.
In the first instance, for example, your Solicitor may wish to
contact the Buyer to reassert your position, demanding whether they
are serious about proceeding with the purchase, and asking for any
serious reason to be put in writing. It may be that, when the Buyer's
bluff is called, they will soon back down. The success of this tactic
does depend on whether either party can afford to delay the Sale.
If the Buyer sticks to their guns, you will have to weigh up whether
it is worth finding another Buyer. Carefully discuss the options
with your Solicitor and Estate Agent. You may be able to reach a
compromise with the Buyer.
Sometimes a Buyer may reduce their offer after the survey, or after
their mortgage valuation survey. You will have to negotiate through
this, again taking the advice of your Solicitor and Estate Agent.
It is unfortunately quite common for the Buyer's mortgage company
to err on the side of caution, and value the property at up to 15%
below the Estate Agent's valuation. Sometimes buyers may proceed
despite this by making up the difference from their own funds. If
this is not possible others in the selling chain may be prepared
to make up the difference - your Estate Agent and/or Solicitor will
advise if appropriate, and carry out negotiations. |
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What if I can't sell, but have a property
I want to move to?
It's unlikely that going ahead with buying the other property
will be a viable option, unless you have sufficient spare capital
to do so. But you do have the option of letting your property (on
a short let for, say, 3 months) whilst marketing it for sale. Rents
for short lets can be high - so you could cover your mortgage and
have a bit left over to help with other expenses. If your Estate
Agent does not offer a short let service, find one who does. Short
lets do not attract capital gains tax - another plus point. Find
out more at short lets.
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Do I have to pay the Estate Agent if
my Property doesn't sell?
You won't have to pay the Estate Agent any fee. However
you may have to pay your Solicitor's legal costs incurred to date,
although some Solicitors, particularly those operating a 'fast-track'
service, may operate a 'no sale, no legal fees' scheme and it is
worthwhile speaking to your Estate Agent about this before instructing
a Solicitor. |
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| Where can I get more information?
Legal/conveyancing:
The Law Society is the professional body for Solicitors in England
and Wales. The body sets standards that underpin the profession's
reputation. Their publications 'The Solicitor's Regional Directory'
and 'Directory of Solicitors' give details on firms of Solicitors
www.lawsoc.org.uk
Surveyors:
Members of The Royal Institution of Chartered Surveyors (RICS) are
bound by strict rules of conduct on matters such as client confidentiality
and conflict of interest. Members advising clients must hold professional
indemnity insurance and follow regulations governing the handling
of client's money. Continual updating of skills is compulsory for
practising members. www.rics.org
Removals:
The British Association of Removers (established for over 100 years)
can give you a list of removal firms in your area. The B.A.R. inspect
and vet these firms, and can therefore testify to their reliability.
They recommend that you contact three of their members to match
the one most appropriate to your needs in terms of price and service.
British Association of Removers, 279 Grays Inn Road, London, WC2
8SY. Tel: 020 7837 3088.
www.bar.co.uk
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