Common California home seller questions include queries about when to sell, how to stage a house, what repairs to make and what information to disclose. It’s a good idea for a home seller to talk to a real estate agent with knowledge of the local market. A realtor should be aware of the impacts of weather. He should also know how the availability of contractors to fix homes and the interests of home buyers will affect home sales.
What Helps a House Sell?
Since 2010, California has been a good market for home sales. Yet simply being in California is not enough to ensure that a house sells at a high price. Factors that play into how quickly and for how much a home will sell include the listing price, terms of sale, condition of the home and location of the property. The proximity of the home to schools, hospitals and shopping centers, the quality of its water supply, the size of its yard or attached property are important. The home’s accessibility, such as how close it is to a freeway, also matters.
What’s the Best Time to Sell?
Traditionally, the best time to show a home is in the late spring, from April to early June. Properties tend to show well when the weather is good, yet not too hot. Families are interested in purchasing a property before children start attending a new school in the fall and often prefer to house hunt when the weather is nice. As such, summer is also a good time to sell. Yet episodes of extreme summer heat, which can occur in Central and Southern California, can present concerns. Summer rains in Northern California can also make it difficult to show a house.
Typically, fewer homes sell in the fall. This means fall sellers have less competition. Yet they may also have to deal with extreme heat. California can be very hot in late September through October, and winter introduces a variety of complications, including rain, cold, holidays, out-of-town visitors and traffic, and end-of-year deadlines.
Should I Fix It?
How much work a seller wants to do before a sale depends on her. A seller can do many little things to make a house look attractive from the outside. Small tasks include clearing clutter, cleaning and painting the exterior, re-sodding brown spots and crab grass in the lawn, mowing the lawn, pulling weeds, removing dead trees and plants, and trimming shrubs. A seller can also plant flowers or remove dead leaves, and cover the ground with fresh wood chips and mulch.
Larger tasks include replacing old flooring, updating kitchen cabinets and repainting inside walls. Repainting inside walls can be tricky. The light changes throughout the day. Even bigger tasks can include repairing the roof and remodeling kitchens and bathrooms. A seller should try to fix whatever is possible before putting the house on the market. This is the key to avoiding the termination of a sale or a potential lawsuit. A property can have many different types of defects, ranging from defects in title, such as an easement for a neighbor to use the seller’s private road, to physical defects like a broken septic tank.
A defect can also include an issue with getting an essential service like homeowners insurance. As an example, past water damage to a property can make it difficult for a new buyer to secure insurance. This is true even if the seller repaired the damage before listing the property. A seller can address such a concern by buying homeowners insurance for the next year and offering to transfer the policy to the new owner.
Must I Disclose Defects?
California requires sellers to inform potential buyers in writing about important facts relating to the condition of a property. These facts, called material facts, could affect a buyer’s interest in purchasing the property and the amount the buyer wants to pay. A buyer can face serious penalties if she fails to disclose material facts. A seller discloses such facts in a form called a Transfer Disclosure Statement, or TDS.
A TDS should describe the condition of the property, including information about the property’s walls, ceilings, floors, insulation, roof, windows, doors, foundation, driveways, sidewalks, fences, electrical systems and other structural components, including solar panels. Information is considered a material fact if it affects the property’s value, desirability or ability to be used as intended. If a material fact changes during the period in which the home is listed, the seller must revise the TDS.
Is a Pest Inspection Required?
California does not require a home pest inspection before sale. In most areas, it is not typical for a buyer to do a pest-specific inspection like a termite inspection before sale. An inspection can become a requirement if a buyer’s appraiser finds conditions that could raise concerns about termites, beetles, ants or dry rot. A seller can alleviate concerns by offering to pay for a home pest inspection during negotiations.
What’s It Worth?
Home prices vary considerably, even on similar lots in the same neighborhood. For example, a waterfront home with a private dock will be worth more than a waterfront home that lacks one. A seller should look at the average days on market to see how fast a home sells after listing. She should also look at market absorption rates, the number of closed transactions year-over-year for a given month, average sale prices and average list price to sale price ratios.
A realtor can help a seller understand the worth of a home by doing a comparative market analysis, known as a CMA. A professionally completed CMA will review considerations such as square footage, number of bedrooms, number of bathrooms, kitchen upgrades, window quality, roof age and flooring type. A CMA should also review the lot’s features, the style of residence, such as Spanish Colonial Revival, and the location. One of the more important questions regarding location is whether the property is on a neighborhood street, such as a side street or a primary street, like a major artery through the city.
How Long Will It Take?
How long the property will take to sell depends on the market. Certain markets, such as San Jose, have seen houses sell very quickly. In other markets, particularly those which are more remote, have fewer places of employment or are known to have concerns with pollution, houses take longer to sell. In 2018, Zillow indicated the typical U.S. home spent between 65 and 98 days on the market.
That year, the average home in California sold far more quickly. In 2018, a home took 49 days to sell in San Francisco and 51 days to sell in Vallejo. The numbers suggest that in California, a house will not be on the market for even two months before the seller accepts an offer.
How Important Is Staging?
Staging can significantly aid a seller. A seller should pick out furniture, decor and items that show off the home’s assets. For example, a seller or realtor could place a desk and lamp in a small room that would work well as an office. This highlights the room’s utility. It also encourages the buyer to see the property has multiple uses.
A seller should use neutral colors like beige and white. He should remove family photos or items that identify the home with the previous owner. This helps the buyer start to see the home as his own. A seller should work to accentuate the light and natural beauty of the property.
What Is the Agent’s Commission?
In California, a real estate agent is paid 6 percent of the final selling price of the home. The seller usually pays all of this cost. Typically, the buyer’s agent and the seller’s agent split the total down the middle, with each taking 3 percent.
The number does not have to remain at 6 percent, however. In California, real estate commissions are negotiable. Yet few real estate agents will be likely to accept an agreement in which their commission falls below 5 percent.
Should I Show The House?
If the owner is engaging in a For-Sale-By-Owner (FSBO), the owner should be present. If not, the owner should consider having a real estate agent show the house. Sometimes buyers are uncomfortable asking a seller questions. A buyer may also have concerns about telling the seller what he plans to do with the property. A seller should consider having an agent show the property if he is under stress, bad at handling rejection and complications or not comfortable negotiating.
How Can I Advertise It?
A seller can advertise a home using e-flyers, social media, signage, direct mail, open houses or broker or agent tours. A seller should also list the property with the Multiple Listing Service or MLS. The MLS allows FSBO listings. A seller should talk to a real estate agent about what techniques work well in her market.
A seller should take many photographs or videos of the house from different angles. It is a good idea to showcase the most attractive and important features of the house, including the master bedroom, the kitchen, the living room and any remodeled rooms. The seller should also photograph assets beyond the primary residence, such as an Accessory Dwelling Unit or pool. If the house has considerable property, like an acre lot, it is helpful to add aerial shots or footage taken with drones. These give potential buyers an idea of the size, nature and assets of the lot.
- California Department of Real Estate: 2020 Real Estate Law
- California Department of Real Estate: Real Estate Matters, Finding the Right Real Estate Agent
- First Tuesday Journal: For-Sale-by-Owner (FSBO) Trends in California
- Zillow.com: Best Time to List a Home for Sale? Early May
- Zillow.com: California Home Prices & Values
- National Association of Realtors: Highlights from the profile of home buyers and sellers
- California Civil Code Section 1102 Transfer of Real Property
- Zillow.com: What Is the Average Time to Sell a House?
- California Association of Realtors: Listing Agreements
- California Association of Realtors: Housing Market Forecast
- California Association of Realtors: Data & Statistics
- First Tuesday Journal: Termites and the California Home Sale