How To Sell Your Home: Unlocking The Door To Success

Ontario's real estate market is diverse, with varying conditions in different regions. Before diving into the selling process, it's crucial to research and understand the local market trends, as they can significantly impact your selling strategy and pricing decisions.

Is now the right time to sell?

Deciding when to sell your property depends on various factors, including market trends and your situation.

• Market predictions: Consider the market predictions and analyze local trends. If it's a seller's market with high demand, sell. A buyer's market with increased inventory might require strategic pricing.
• Personal factors: Various factors, such as job relocation, changes in family size, or retirement plans, can significantly impact one's decision to sell a property. It is essential to consider these factors before deciding to sell your property.
• Seasons: Spring and summer are typically the busiest seasons for home sales, so consider timing your sale to align with increased buyer activity.
• Value of your property: Assess the current value of your property; if it has significantly appreciated, consider selling for a higher return.
• Economic indicators: Broader economic factors like interest rates and job market stability can attract more buyers.
• Personal finances: Evaluate your financial situation before selling to ensure readiness.

Decide if you will sell with a realtor or privately

When selling a home in Ontario, hiring a real estate agent is the most common practice. An experienced agent can provide valuable guidance, promote your property effectively, and negotiate on your behalf. Therefore, many sellers work with a real estate agent to simplify the selling process and get the best results.

If you are considering selling privately, some pros include saving money on realtor costs, expediting the selling process since there are no intermediaries, personally showcasing the property, and having more control over negotiating with buyers.

Cons of selling privately include limited exposure due to lack of expertise and real estate marketing experience, legal risks, pricing errors, and challenges with negotiating.

Get a home evaluation and set your selling price

Work with your real estate agent to determine the appropriate listing price for your home. This process involves thoroughly assessing your area's current market conditions and comparable property values and evaluating your home's specific features and condition.

Prepare your property and add curb appeal

Prepare your home for sale by cleaning, decluttering, and addressing any necessary repairs or renovations that can enhance your property's appeal and value. Many sellers seek help from a professional real estate agent to guide them through the process and ensure a positive outcome.

Depending on your budget, you can do simple upgrades such as a fresh coat of paint, new lighting fixtures, and organizational features. If you have a bigger budget, consider upgrading your kitchen or bathroom and adding new flooring.

You’ll also want to consider hiring a professional cleaning company and storage boxes to remove furniture and personal items while showing the house.

List your property

Once a suitable listing price is determined, your agent will list your property on the Multiple Listing Service (MLS) and other relevant platforms such as social media, real estate websites, advertising, and outside the real estate offices, broadening its exposure to potential buyers.

Schedule showings and market your property

Your agent will implement a marketing strategy to attract potential buyers. The strategy may include online and offline marketing, open houses, private showings, and deadlines for viewings and offers on your property.

Receive and negotiate offers

When you receive an offer, your agent will present it to you. You can then choose to accept, reject, or counter the offer. Negotiations may continue until both parties reach an agreement.

In the past, low-interest rates motivated buyers to enter the market and increased multiple bids on homes, especially if they were listed at attractive prices. Demand increased supply, so buyers would submit strong offers to secure the house.

The pressure to handle multiple high-ticket offers can be a challenge with many risks. Real estate agents play a crucial role in managing the dynamics of multiple offers, ensuring a fair and efficient process for sellers and buyers. They can offer counteroffers, follow legal and ethical rules, guide you in decision making, and set a deadline.

Outline conditions and expect a home inspection

It is common practice for a buyer to request a home inspection. In case any issues are identified during the process, negotiations may resume either for repairs or a possible sale price reduction.

As a negotiation tactic, buyers may choose to waive the home inspection as a term and condition of the sale. Once an offer is accepted, the process enters a critical phase where inspections take place. Negotiations may occur based on the findings of the inspections.

Accept an offer and finalize the sale

Once both parties agree on the terms, you and the buyer will sign a purchase agreement. Legal aspects of the sale are handled by either your lawyer or a notary, who ensures that the title is clear, prepares necessary documents, and facilitates the transfer of ownership. The closing day is the culmination of the process, where the buyer finalizes paperwork, provides funds, and officially takes possession of the property on a defined date.

Finalize the sale

Your lawyer or a notary will handle the legal aspects of the sale. This includes ensuring the title is clear, preparing the necessary documents, providing proof of insurance on the home, and facilitating the transfer of home ownership to the buyer of the home.

Seeking professional advice from both a real estate agent and a legal professional is highly recommended to navigate potential complexities and ensure the process is done to legal and municipal standards.

What to expect on closing day

On closing day, the buyer will typically visit their lawyer's office to finalize the paperwork and provide the necessary funds. Once the transaction is complete and keys are exchanged, and the buyer will officially take possession of the property.

After the sale is complete, the proceeds from the sale will be distributed. Your lawyer will settle outstanding mortgages, pay closing costs, and provide you with the remaining profits.

Many buyers plan to move on closing day. They assume they will get the keys first thing in the morning. However, it's more common for buyers to receive the keys closer to the end of the day. If you are planning to move on closing day, make sure you are aware of when you will get the keys.

PS: Don’t neglect your insurance

When selling a home in Ontario, remember to maintain your Ontario home insurance on your current location until the sale is finalized to protect against unforeseen events. Liability coverage is also recommended to safeguard against potential issues during the transition period.

Remember that real estate transactions can be complex, and consulting with a real estate professional and a legal professional is advisable to ensure a smooth and legally sound process. The specifics of the process can vary, so it's essential to stay informed and seek professional advice when needed.

When selling your home, it's important to consider various insurance aspects for a smooth and secure transition on the property you are selling, and the one you are buying.

Contact your insurance provider as early as possible in the home buying process. They can guide you through the necessary steps and provide the required documentation. You may need to change your policy to condo insurance, or cancel your tenant insurance.

To do this, you’ll share the property's address, size, construction type, and any relevant details about security features with your broker, which will help determine the appropriate coverage for your home.

Mortgage lenders often have minimum coverage requirements, so ensure that your policy meets or exceeds these standards.

You can request an insurance binder or a declaration page from your insurance provider to prove that you have adequate insurance coverage. This document contains important details about your policy, such as the effective dates and coverage amounts.

You will need to provide this document to your mortgage lender, as they may require proof of insurance to protect their investment in the loan and ensure that the property is sufficiently covered. Some lenders require a confirmation of payment before closing.

If there are any changes to your insurance coverage or provider before closing, promptly notify your lender to ensure a smooth closing process.

Starting insurance early is crucial to avoid delays in closing. Coordinate with your provider and lender to secure the necessary documentation and coverage to meet mortgage requirements and protect your new home.

Not to be confused with property taxes, land transfer tax is collected by a province or municipality (or both, depending on where you live and where you are moving). The buyer pays the land transfer tax, and they are due as soon as the buyer takes possession of the property.

You likely can’t avoid paying the land transfer tax unless you are a first-time home buyer, where you may qualify to have some or all, or the transfer payment reimbursed.

Land transfer tax is calculated as a percentage of the property’s estimated value. According to the Government of Ontario, it can be calculated as:

• Amounts up to and including $55,000: 0.5%
• Amounts exceeding $55,000, up to and including $250,000: 1.0%
• Amounts exceeding $250,000: 1.5%
• Amounts exceeding $400,000, where the land contains one or two single-family residences: 2.0%.

Beyond the purchase price of a property, selling a house comes with various costs, and while the actual amounts can vary, here is a general breakdown of potential expenses:

• Lawyer fees and closing adjustments: Legal fees cover the cost of hiring a lawyer or a notary to handle the sale's legal aspects. The cost can range from $1,000 to $2,500 or more, depending on the complexity of the transaction.
• Real estate agent fees: Real estate agents charge a commission based on the home's sale price, usually around 5% in Ontario. The commission may be split between the listing and the buyer's agent. Additional charges for premium listings, professional photography, or other promotional efforts may apply.
• Mortgage discharge fees and mortgage repayment penalties: In Ontario, the seller is responsible for the land transfer tax, which is calculated based on the purchase price and may range from 0.5% to 2.5%. If you plan to pay off your mortgage early, be aware that you may incur a penalty, which can vary depending on your mortgage terms and lender.
• Utilities and property taxes: Sellers are responsible for utilities and property taxes up to the closing date, which varies based on the sale agreement.
• Land transfer tax: As mentioned above, you must consider the land transfer tax amount in your budget.
• Repairs, modifications, and professional staging: To increase the appeal of your home, you may need to spend money on staging services. Additionally, addressing any necessary repairs before listing can contribute to a higher sale price.
• Moving expenses: Don’t forget to consider how much your moving costs will be. Speak with a reputable moving company for assistance.
• Insurance: Depending on your insurance needs, replacement value, and any other endorsements, such as contents insurance, you’ll pay between $50-$100 a month for coverage.