Are you ready to sell your home in Massachusetts? You’re in luck, because the spring and summer of 2024 may be the best time to do so. We only need to look at three statistics to see Massachusetts as a seller’s market.
- According to Redfin, Massachusetts home prices continue to soar. The median home sale price rose 6.9% year-over-year from $536,000 to $573,000
- The number of homes sold on the market declined by 7.2% YoY from 3,694 to 3,427 homes, with only two months of supply.
- According to Federal Reserve Economic Data, time on the market has steadily declined.
Anecdotally, Massachusetts has always been a great state to live in, so people always want to move here. Another reason is the scarcity of land left to develop. From June 2012 to June 2017, approximately 24,700 acres of natural land were converted to development in Massachusetts. Nowadays, most new homes are just remodels of older houses.
All this being said, every new listing will capture the attention of hundreds of buyers. But listing your home doesn’t guarantee a financial windfall. So the question becomes:
| How can I get top dollar for my home and what are the steps to sell quickly?
Read on for a rundown of what you should consider and how much you’ll have to pay to sell your house in Massachusetts.
Step 1: Pre-Listing
Most buyers are looking for move-in-ready homes to avoid major home improvement projects. Unfortunately, most homes in Boston were built pre-1965, meaning they’re more project than move-in ready. Buyers are lowering their expectations, but we advise being as prepared as possible.
Pre-Listing Inspections: A Good Idea?
Some agents will recommend that you do a pre-listing inspection. They may even pay for it themselves. This may be a good idea as it lets you know what might come up in an inspection. You can address the issue or not allow it to blindside you at the negotiation table.
Some buyers will even waive their inspection contingencies and use your report. This all means less time on the market and faster pendings. Make sure you hire a qualified inspector. We would even caution against blindly using the inspector your realtor recommends.
Declutter & High ROI Upgrades
You don’t need to pay an inspector to know how to declutter your home and pack things away. Let’s talk about some high-ROI upgrades because getting lost in the weeds is easy. There’s no need to renovate your home in this market. Significant renovations cost money and time. Unless you’re a contractor, your labor expenses will eat up the increase in the sticker price.
| The only renovations we consider mandatory are potential hazards that don’t deem your home move-in ready.
High ROI Low-Cost Upgrades
- A fresh coat of paint on tired walls with a neutral color
- If you don’t have pets, get the carpets cleaned. If you have pets, don’t get your carpets cleaned. Why not? Because cleaning actually can make them smell worse temporarily. If there’s a noticeable pet odor, get your carpets replaced.
- Replace old wall switches
- Remove a few blinds to let more light in
- Plant fresh flowers and add mulch and sod
- Regrout and recaulk bathrooms and baseboards
Rent Storage Space
Rent storage space while decluttering to make your interiors more visually appealing. Less furniture and clutter can make rooms look bigger. A mistake sellers make is stuffing their clutter away in closets and cabinets. Buyers look there, too!
Step 2: Finding An Agent
Our #1 tip for finding a good agent is to look for a successful realtor in your market. If they’ve sold a home in your neighborhood, great. They will know what makes the neighborhood unique, and if the homes are similar, they’ll know that, too. Inexperienced realtors sometimes need an adjustment period to find the price that attracts offers. In the real estate business, time is money.
Questions to ask an agent:
- How long have you been working in real estate?
- Do you have any professional certifications?
- Can you give me any insights into the uniqueness of my situation? Do you have any expertise in these?
- Are you primarily a buyers or listing agent?
- What is your professional network like with vendors?
- How many active clients are you working with?
- What are your fees?
- How many homes have you sold in the past year?
It’s not mandatory to sell a home with a real estate agent. If you go the FSBO route, make sure of two things.
- You’re pricing your home at the most competitive price.
- You hire an attorney or reputable title company to handle all the paperwork and closing.
Step 3: Listing
Time is the biggest ROI. You want to minimize the time between listing your house and closing. A nice luxury to have is moving out before you list your home. This allows you to deep clean and get your home ready for showings.
Pricing Your Home
Finding a trustworthy realtor is crucial because there are both inexperienced and unethical agents. An inexperienced agent will buckle under the pressure of lowball offers. An unscrupulous agent will push you to accept offers below the asking price so they can get their commission. A $10,000 increase would mean a lot to you, but in terms of their commission, it’s peanuts.
All that aside, a good agent will do a comparative analysis of the market to understand what buyers recently paid for similar properties. The trick is to price it low enough to get offers but not too low, where people wonder what’s wrong with the house. Just low enough that you get lots of interest to strengthen your position but not too low that you have a steep mountain to climb when negotiating multiple bids.
If your home is priced correctly, it should appraise at the sale price
The Best Time To Sell
The best months to sell a house are during the spring season, from April to October.
Step 4: Marketing & Showing Your Home
The first impression is vital. Follow the advice in step 1, and you’ll be 90% there. If you have kids, remove their toys and art from the fridge. Yes, it’s cute, but a symphony of colors won’t add charm. Think of what a nice hotel room looks like when you first walk in. Everything is clean and in its right place. That means putting the toilet seat down, cleaning mirrors, removing your towel from the bathroom, taking out the garbage, etc.
Lastly, go into every room from the basement to the kitchen and take a deep breath in. Do you smell any odors from cooking or mildew? Get that sorted out. You can use air fresheners or use an old school trick of putting vanilla in tinfoil in the oven.
Remove items with personal information and valuables not attached to the wall or floor. It’s sad, but lookie-loos go to open houses to be nosy and steal stuff.
When it comes to showings, listen to feedback and don’t take it personally. Rather, have your realtor listen to feedback because you should NOT be there. You’re more likely to mess it up than help convince potential buyers.
Have a friend come over to look at your house. Outside feedback is good as a trusted human with detached expectations can give you honest recommendations.
Step 5: Offers & Negotiations
How you price, list, and stage it is 50% of the battle for maximizing the sale price.
Offers will come in the form of a purchase agreement, which states the offered price and an expiration date. Don’t get offended by offers; it’s just a business transaction. Either counter or ignore them and move on.
Some buyers will try to nickel and dime you for everything you’re worth. Having a pre-listing inspection report can give you some power back.
Purchase Agreement
A purchase agreement is a legally binding agreement between a buyer and a seller outlining the terms and conditions of a property sale. This agreement typically includes details such as the property address, purchase price, earnest money deposit, financing terms, closing date, and any contingencies or conditions that must be met for the sale to proceed.
Cash-Offers
A cash offer in real estate refers to an all-cash bid to purchase a property. Traditional homebuyers rely on a lender and mortgage financing to provide funds. An all-cash buyer has the funds readily available to complete the purchase. Sellers often view cash offers more favorably because they typically involve fewer contingencies and can close faster than offers contingent on financing.
Disclosures
Massachusetts is one of the few states that follows “caveat emptor” or “buyer beware.” This means that you’re not legally required to disclose to the buyer. Instead, the buyer should ask the right questions, schedule an inspection, and look at the home. If asked, you’re required to disclose the truth, but only when asked.
What You Do Have To Disclose
- Lead Paint: It’s state and federal law for sellers in Massachusetts to declare the presence of lead paint anywhere on the property. The federal government banned lead paint for residential use in 1978. The Department of Housing and Urban Development estimates that roughly 35 percent of U.S. homes contain some lead-based paint. The buyer has the right to request a paint inspection. (See the Massachusetts Lead Paint Statute)
- Septic Tank: Sellers must disclose if their sewage is disposed of in a septic tank system. If that’s the case, septic tank systems need inspection before a sale occurs. (See Title 5 of the Massachusetts Environmental Code).
Step 6: Appraisal & Inspections
Appraisals are meant to protect the mortgage lender from issuing a mortgage against insufficient collateral (e.g. issuing a $500k mortgage on a home that’s only worth $400k). An appraisal can take anywhere between a few days to a month.
In addition to a pre-listing inspection, consider getting an appraisal as well.
Unless another period is negotiated, a buyer has between five and 10 days to complete a home inspection. During that time, they can cancel for any reason. If you’re a seller, you can demand that you’re allowed to fix any issue that comes up in the inspection report. This can keep the buyer from walking away for a fixable reason.
Many of the issues in inspection reports are just the inspector poking and prodding to justify their fee. Just because it’s in the report doesn’t mean your home is uninhabitable.
Step 7: Closing
Sellers don’t need to physically be at closing in Massachusetts. If anyone will be there, we suggest you work with a real estate attorney. They’re not as expensive as you’d think.
Closing Documents
- The HUD-1 or Closing Disclosure: A document used to itemize and reconcile all the financial aspects of a home purchase or refinance transaction. It provides a detailed breakdown of all costs and fees associated with the transaction. These include the purchase price, loan amount, closing costs, escrow amounts, loan terms, and conditions.
- The Deed: A deed is a legal document that transfers ownership of a property from one party to another. It is a critical part of the process, as it is used to officially convey the property rights from the seller (grantor) to the buyer (grantee). The deed typically includes the following information:
- Certificate of Title: This document allows you to state that you have the right to sell your own home in Massachusetts.
- Two Forms of Official ID: When selling your home, you typically need to provide two forms of identification to verify your identity and comply with legal requirements. The specific forms of ID required may vary depending on your location and the laws or regulations in your area.
- Title V Certificate: In Massachusetts, a Title V inspection is required for properties with septic systems. A certificate indicating that the septic system is in compliance with state regulations may be required at closing.
- Mortgage Payoff Statement: If the seller has an outstanding mortgage on the property, a payoff statement from the lender will be required to confirm the amount needed to satisfy the mortgage.
- Homeowners Association Documents: If the property is part of a homeowners association, documents related to the association, such as bylaws and financial statements, may be required.
- Bill of Sale: If the sale includes personal property, such as appliances or furniture, a bill of sale may be required to transfer ownership of these items to the buyer.
Who Pays Realtor Fees
The biggest line item on your list of expenses will be real estate commissions. In most real estate transactions, the seller pays the realtor fees. These fees are often paid out of the proceeds from the property sale. They’re usually a percentage of the sale price, split between the seller’s and buyer’s agents.
