SELLING YOUR HOME

When should you sell?

In real estate, timing influences your home’s selling price. Working with us can help make timing work for you.

How do you prepare your finances?

Before the offers start rolling in, you should prepare for the massive amounts of money that will pass through your hands.

WHEN SHOULD YOU SELL?

The Market

When lots of people are looking for homes but not many are for sale, it’s a ‘seller’s market’, because the seller has something everybody wants. When there are lots of homes for sale and not many people buying them, it’s called a ‘buyer’s market’ because buyers have more power of choice.

Timelines

In a seller’s market, top price and a fast sale can go hand-in-hand. In a buyer’s market, more sellers are competing for your potential buyer. If you have to sell right now, consider lowering your asking price a bit to speed up the sale. We can help you figure out the right price-to-speed ratio.

Seasonality

It’s true. Winter sales tend to be slower, and spring sales are more brisk. Regardless, there are always people looking to buy, and seasonality is only one of many factors to consider.

Buying Too?

If you sell your existing home for a ‘low’ price, you’re probably also buying at a low price. If you are upgrading to a larger home, this actually works to your advantage. If you’re downsizing from a bigger home to a smaller home or a condo, you need to pay a bit more attention to the market.

The Eternal Question

Many people are able to time their sale and purchase so they happen on the same “closing date”. As a buyer, you can make your offer “conditional” on the sale of your existing home to make sure you’re not left paying for two homes. As a seller, you can try to extend the “closing period” to give yourself more time to find your next home. I can provide advice and counsel during these kind of negotiations.

Managing Two Homes

Talk to your existing mortgage lender about “Bridge Financing”. This is when your lender (the bank) agrees to lend you the down payment for your new dream home, while you still cover the mortgage on your existing property.

HOW TO PREPARE YOUR FINANCES

"Discharging" Your Mortgage

Many people use the proceeds from the sale of their home to “discharge” or pay off their mortgage. If you have what is known as an “open” mortgage, you can pay it all off without any penalties. If you have a “closed” mortgage, be prepared to pay a penalty. The penalty amount will depend on a number of factors, including how much time is left on the term of the mortgage.

Is Your Mortgage "Portable"?

A “portable” mortgage means you can take your mortgage money with you and buy a new home, without penalty. This can be a real bonus if the interest rate on your mortgage is lower than existing rates! If your new home is more expensive, and requires more mortgage, you’ll have to borrow the extra money at the current market rate.

Who is "Assuming" The Mortgage

Your mortgage may have a feature that allows the new buyer to take over your mortgage. If the interest rate is lower than existing rates, this can be a very enticing selling feature for your home.

Did you buy first?

What if you find your new dream home before you’ve started to sell your old one? Talk to your existing mortgage lender. You may be able to arrange “Bridge Financing”. This is when your lender (the bank) is confident your existing home will sell quickly, and they agree to lend you the down payment for your new dream home.

Capital Gains Tax

If the home was your primary residence, you will not have to pay taxes on any capital gain (the increase in the value of your home). If you had tenants living in part of your home, such as the basement, you will pay capital gains tax on a portion of your profits. You may also owe capital gains tax if you’re selling a vacation or investment property. Talk with an accountant to find out what you’ll have to pay.