Unless you’ve been living under a rock, you know just how red hot the housing market has been of late. The current median home price — half are higher, half are lower — is $375,300, according to the National Association of Realtors, up 15 percent from a year earlier. It’s hard not to think about taking some profits and retiring to a smaller and less costly home.
If you’re thinking of selling your house, May is the best month to list it, according to ATTOM Data Solutions, a real estate research firm, followed by June and July. You’ll find more interested buyers in those months and, potentially, more lucrative bids. The worst months to put a house on the market: December and October.
For many homeowners, the decision to sell is typically followed by thousands of dollars of updates so the new homeowner can enjoy things you’ve denied yourself, such as a new kitchen floor or a deck that doesn’t have a raccoon family underneath. This is not altruism: You’re hoping that shining up the place will bring a higher price.
And that’s a good instinct. But the question is: What can you do to make your home more attractive to buyers? And what else can you do to get top dollar for your house? Here are five steps to consider taking:
1. Figure out what it’s worth
A real estate agent can show you recent selling prices of comparable homes. But it doesn’t hurt to look around yourself, just so you both can have a similar starting point for setting a sale price. You can find current asking prices for homes on a number of websites, such as Zillow and Opendoor. Bear in mind that these are what owners want to get for their houses, not necessarily what they will get. A better method is to look at recent sales prices, which you can typically get from local government websites or the newspaper.
You may have to pay capital gains taxes on the profit from the sale of your main home, but only if you make a bundle. Single individuals can keep up to $250,000 of the gain on the sale of their houses tax-free; married folks can keep $500,000 of the gain.
Obviously, you’re going to have a clean house when you put it on the market. But you don’t want a cluttered house, either. If you’re planning on downsizing for retirement, get cracking. Start with the easy decisions: If you’re going from a four-bedroom ranch to a two-bedroom condo, you’ve got two rooms (at least) of furniture to dispose of as well as lawn mowers and dozens of yard tools. Then move on to the harder stuff: Your grandfather’s stuffed moose head, your kids’ trophies and that lamp your spouse loves but you loathe.
You might consider hiring an estate agent to help you select what you want and sell the things you don’t. “People think of an estate sale when somebody dies,” says Bob Lang, president of Blue Moon Estate Sales. “That’s a very common mistake. Estate sales are good way to help people downsize.”
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Sure, you’re daring with paint, and those green accent blocks in the family room are the talk of the neighborhood. To a buyer, however, those walls say, “You’ve got a big paint job ahead of you.” Political paraphernalia? Take it off the mantle and put it in a drawer somewhere. And doesn’t everyone love the Mets? Why, no. No, they don’t.
4. Make strategic home improvements
According to Remodeling magazine’s 2022 “Cost vs. Value” report, you don’t have to add another wing to the house to improve its value. Top on the list of home improvements with the best resale value: a new garage door. Real estate agents often talk about a house’s “curb appeal” — how it looks as customers first pull up. A tattered garage door does not have a lot of curb appeal.
Big remodeling jobs are a gamble. You might love an ultramodern kitchen with gleaming white marble counters; buyers might like something a bit more rustic. You might be wiser adding a neutral shade of paint and let your buyer do the remodeling. A major kitchen remodel was near the bottom of Remodeling’s resale value list; only bathroom additions and master suite additions were lower.
You can increase curb appeal even more by tidying up the lawn and gardens. Houses with mature trees tend to increase a home’s value; houses with vines tend to decrease value.
5. Consider staging
Those homes that sell for fabulous sums on HGTV? Many are professionally staged — that is, someone takes your stuff out and brings in some lovely understated and artfully arranged furniture as well as a fern or two. But count the cost for that staging: typically, about $500 to $600 per month per staged room. And, according to Realtor.com, most professional stagers require a minimum three-month contract.
John Waggoner covers all things financial for AARP, from budgeting and taxes to retirement planning and Social Security. Previously he was a reporter for Kiplinger's Personal Finance and USA Today and has written books on investing and the 2008 financial crisis. Waggoner's USA Today investing column ran in dozens of newspapers for 25 years.