Reality Check #1 – Everyone experiences a little “sellers remorse”. Are you ready for this?

The emotional bond developed with your current home will be stronger than you may first imagine. If you’re not prepared “emotionally” to move home, you will find it hard to accomplish the 3 jobs crucial to the success of your sale:

Reality Check #2 – Do you know the true condition of your property?

Haggling over your price becomes possible once buyers find problems raised in the survey.

If you want to avoid this and put yourself in the best negotiating position possible, get to know the true condition of your property (before you put it on the market).

Most owners have a pretty good idea of this however, if you are in any doubt, here’s how to get the information you need:

Builders have an excellent grasp of the common defects that residential property suffers from. Most builders will do this for free if they think there’s a job in the pipeline.

If the survey or the builder does find problems you can either:

Reality Check #3 – Are you going to ask for too much money?

Everyone wants to sell for as much money as possible however there is always the temptation to test the market and ask that little bit more.

These days the Internet allows you to instantly compare all the property that’s for sale in any area. Because of this, the vast majority of buyers are just too well informed to overpay.

Remember, a property is only worth what a buyer is willing to pay for it (you can’t force anyone to pay more, they will just walk away). What a buyer is willing to pay is directly linked to what other properties like yours are being advertised and sold for.

It may seem counterintuitive but in reality, asking for more often leads to selling for less. Whereas, asking for less often leads to selling for more.

An unrealistic asking price will leave your home sitting unsold while all around others are selling-up and getting on with their lives.

On the other hand if you advertise your property competitively, you will attract buyers.

The more you can attract the better because this breeds competition. Competition between buyers starts bidding wars and bidding wars result in higher sale prices.

When it’s time to sell it’s only natural to want to make the maximum profit possible.

Because of this, many house sellers are quick to believe that fitting a new bathroom suite or kitchen, will be a sure way to make a quick and easy last-minute profit.

Unfortunately, this is usually not the case and once fitting costs are factored-in, most last minute renovations projects barely break even.

Instead, keep in mind that painting, cleaning & refinishing surfaces have always been (and always will be) the easiest, quickest and cheapest ways of increasing the achievable sale price of a property.

When you’re selling, it’s far more profitable to just present what you have, as well as you can.

In other words, unless a room or element (e.g. the carpet) of your property is:

• Deeply unattractive

• In total disrepair

• Unsanitary

Good presentation does take time and effort but you will be rewarded by dramatically enhancing the saleability of your property.

To help you on your way, click here for our eight-step plan to getting your property ready for sale.

We would urge you to get a feel for the market you’ll be selling into and the value of your house before you speak to any Estate Agents.

It is well know in the property industry that Estate Agents often overvalue property to gain new business.

Flattery (i.e. giving a vendor an inflated idea of their properties value) is always a winning strategy. Unfortunately once the vendor has signed the agent’s contract, it’s often not long before price reductions are suggested.

A recent report from the consumer group Which? investigated the Estate Agency industry. Researchers posed as sellers and invited 56 Estate Agents to value 14 properties across England.

In six cases the highest valuation was 25% higher than the lowest.

The most extreme case of inaccurate property valuation was in Tyne & Wear where the Halifax valued a home at £200,000, while Moody & Co suggested £325,000.

That’s a £125,000 difference in valuation figures!

Falling victim to an inaccurate valuation is a horrible situation to be in however, it is easy to protect yourself:

Doing these 3 things will quickly give you a realistic idea of:

• The state of the market

• The value of your home

With this knowledge you are then ready to get the opinion of Estate Agents. If you do speak to agents make sure you keep a couple of things in mind:

If you are using an estate agent, under section 18 of The Estate Agents Act, before they enter into any contract with you:

This must be presented to you in writing (normally via a “Terms of Business” overview document) otherwise the agent will not be able to enforce payment of their fees without a court order.

Also, The Estate Agents’ (Provisions of Information) Regulations 1991 makes it clear that if the terms:

• Sole agency

• Sole selling rights

• Ready, willing & able purchaser...

...are used by the agent, these terms (their meaning and their effects) need to be explained to you (again in writing).

It’s worth pointing out that the law only requires agents to make you “aware” of their terms of business.

Once the Agent has done this, your agreement with them could be considered legally binding - Even if you don’t actually sign a formal contract!

Always insist that once terms of business have been negotiated a contract is drafted that reflects your agreement and with which you’re happy.

Get it all in writing so that if anything goes wrong you have a signed document for reference and protection.

The Advisory go over Estate Agents’ Terms of Business and how to negotiate the fairest terms in greater detail on their house sales information website however, for now we’d like to plant the seed of an idea in your mind….

There are far too many Estate Agents in the UK at the moment. This is because there are no barriers to entry (no license or qualifications are required to set-up as an Estate Agent).

Because of this you need to recognise that Estate Agents are desperate for your business and so you’re the one in control (the one who can call the shots).

In short, Estate Agents need you far more than you need them!

There are a myriad of unfavourable terms that you can find tucked away in the standard Estate Agent’s contract. Although they’d love to tell you otherwise, everything from the fee to the tie-in period is negotiable.

Post June 1st 2007 (when Home Information Packs are introduced), this is going to be more important then ever.

Now is not the time to give you a full explanation of what a HIP contains or why they were introduced. Irrespective of the hype, fundamentally Home Information Packs are just:

“A collection of standard legal documents with an Energy Performance Certificate tagged on”

The reality is that buyers and sellers are not going to find much of any real interest or value in them. Instead they’ll find that HIPs will:

• Make selling a property more expensive. The expected costs are £350-£500 although most vendors will be given the option to pay for their HIP out of sale proceeds (on a deferred payment plan).

• Introduce upfront delays because you need your HIP in place before you’re allowed to put your property on the market.

These are just things we’re going to have to live with and it really not worth your while getting under the skin of the new legislation. However, what is worth giving some thought to is:

“Who should you choose to arrange your Home Information Pack?"

Unfortunately most unsuspecting vendors will choose poorly because they’ll be receptive to estate agents that offer HIPs for free (or on a deferred payment plan).

Please think carefully before accepting the offer of a totally free HIP. As we all know, there really is no such thing as a “free lunch” and you’ll find that the cost of the HIP will most likely be wrapped in a higher commission fee.

Cost is one consideration but it’s really the amount of control (over you and your sale) that you’ll be giving away that should worry you.

With this in mind we’d like to make you aware of the likely repercussions of allowing an estate agent to pay for your HIP:

• Many Estate Agents will be using HIPs as an opportunity to make extra profit from you through marked-up prices. What will the agent charge you if you don’t actually move or sell?

• If you become unhappy and want to change agent, you will have to pay a withdrawal fee to release yourself (and your HIP) from the agency agreement. You can expect this withdrawal fee to be more than the “cost-price” of your HIP (this effectively marks the end of “no-sale, no-fee” estate agency).

• Expect to have to sign a contract that gives the agent “Sole Selling Rights”. This means that even if you find a buyer yourself, you’ll still have to pay the agent’s commission.

• Having control over your HIP may well give agents greater leverage in being able to lock you into using services (e.g. conveyancing and financial) that they’ll earn commission from. These services are seldom the best value and in some cases overpriced due to the incorporation of the agents referral fee.

So to whom should you go to for your HIP? It is very unusual for vendors to have reason to switch solicitors during a property transaction and as trusted and fully regulated professionals they are the clear favourites for this job.

Using a solicitor to arrange your HIP will allow you to:

• Retain the ability to easily fire an under performing estate agent and go elsewhere. With the reputation of estate agency being what it is, the last thing you want is to be tied to sub-standard agent. The only escape being the payment of a marketed-up withdrawal fee.

• You’ll also be able to negotiate terms of business that will allow you to avoid having to pay the agent if you find a buyer yourself.

  This is an important thing to consider because with so many effective private sale marketing websites out there, cutting out the estate agent and saving £1,000’s is a very achievable thing to do.

• Negotiate a reduced selling commission with estate agents. For example, on a £250k property, even if you’re only able to negotiate a reduction on their “all-inclusive HIP” fee of 0.25%, you’ll have saved £625 + VAT.

In summary, the best advice we can give you is to shop around for a recommended solicitor and instruct them to put together your HIP before you choose your estate agent.

It’s understandable to have initial reservations about this however, these days most conveyancing solicitors work on a “No-sale, no-fee” basis. This means there is no cost or risk in following our suggestion – only benefits.