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How Much Are Seller Closing Costs in California?

Figuring out the closing costs associated with your property is important process for a seller in California and nationwide.

If you live in the Golden State and are thinking about selling your home either now or sometime in the near future, then one of the first questions you might ask yourself is “How much are seller closing costs in California?”

Selling your home is probably one of the biggest financial transactions you’ll ever make. It’s important you understand the costs involved and also how they will impact your bottom line. We’re going to break these down in detail. First, this article will go through the closing costs for a seller in California. Then, it will also show you tools and resources that will help you get a rough estimate on your net proceeds and if you’re in Silicon Valley, potentially save you thousands of dollars.

Understanding What Seller Closing Costs in California Are

First, it is important to understand what exactly closing costs for a seller in California consist of when you are about to sell your property. There are four major groups these closing costs can be categorized under. These include:

  • Real estate commissions
  • Escrow and title fees
  • Transfer taxes
  • Miscellaneous items

Some of these costs can vary depending on what county and city you live in. Depending on the value of your home and the final selling price, your closing costs can come out to a large amount.

City transfer tax in California

Many Realtor’s ® avoid talking about a seller’s closing costs because it can be an uncomfortable conversation for them. This is often because they have a hard time justifying their commissions. Understanding what your closing costs will be and how much these are going to cost you when selling your home will help you be better prepared in knowing who and what you’re paying for, as well as why. The next section will break this down further.

What Is The Real Estate Commission In California?

The average real estate commission in California is 5-6%. But you don’t necessarily have to pay this amount. Contrary to what some real estate agents will tell you, real estate commissions in California are negotiable. In fact, it says this on the first page of the listing agreement you’ll sign with your agent.

 

real estate commissions are negotiable in listing agreement

 

When you go to sell your home, you will pay your listing agent’s commission. You will also pay the buyer’s agent’s commission. The usual 5 or 6% is normally split 50/50. When you commit to your Realtor ®, you will sign a listing contract with them. This contract is usually an exclusive agreement between you and the agent’s broker. (The broker refers to the company that the agent works for).

The California Listing Agreement When Selling Your Home

When you sign the listing agreement, there are a few important things that you’ll want to look out for. One of these things is the total commission. It’s important to understand how much is going to your agent’s brokerage, as well as how much is going to the buyer’s brokerage. Some listing agents will avoid talking about this when discussing the closing costs for a seller. This could be because they may try and keep more of the commission for themselves.

An example of this might be an agent who is charging you a 6% commission, but really paying the buyer’s agent 2.5% and keeping 3.5% to themselves. This is something you should look out for and discuss with your agent upfront. The listing agreement you sign with your Realtor ® specifies not only the total commission percentage but also how much your listing brokerage will be paying to the buyer’s agent.

Below is an example of our listing agreement. The 3.5% is the total commission that the seller pays. Of this, 2.5% is paid to the buyer’s agent (if the buyer is represented by another brokerage). If the buyer is represented by SoldNest, then the total commission drops to 2%.

 

California real estate listing agreement

 

This is where your agent can add in any additional terms to the agreement.

 

real estate commissions in california

 

Since we’re talking about the listing agreement, I’ll mention one more thing you’ll want to watch out for. This is an exclusive agreement between you and the brokerage your agent works for. This means that you cannot work with another agent to sell your home for the time period that the agreement is good for.

Many agents will tell you that the listing period has to be six months – it doesn’t. Similar to the commissions, this is also negotiable. Other brokerages will tell their agents to always say or use six months because this will ensure they still get paid even if your home takes longer to sell. You should only agree to a time period that you’re comfortable with. These dates are filled in on the top of page one.

 

real estate listing agreement dates

 

Saving On Real Estate Commissions in California

How can you save on real estate commissions when selling your home? There is one critical first step. Ask. Real estate commissions are negotiable. Any agent who tells you otherwise, or paints the picture that commissions are non-negotiable, is flat out lying. Most agents avoid talking about commissions because they can’t justify how much they’re getting paid. Instead, they’ll talk to you about how great their company is that they work for (which has no impact on the sale of your home). They may also talk about who they are, and how long they’ve been in the business. While this may be interesting background information, it doesn’t necessarily correspond to how well they will be able to sell your property.

Interviewing a real estate agent is just the first step of the home selling process. Finding out how much you are going to pay in commission should be one of a few important questions you can ask upfront. Your goal should be to try and get the best service and the best marketing at the lowest commission. Along with this, you want to be partnering with someone you feel comfortable with.

There are some agents who will charge you less in commission. But most of the time, you’re not getting the service and the marketing that you should. Most of these discount real estate agents only do the bare minimum. This includes putting your home on the MLS, having an open house, and having flyers made. It’s not to say that real estate agents shouldn’t do these things. They should do these things and more.

Time For A Change

Many homeowners think the seller closing costs in California are too high and due for a change. We agree. This is one of the reasons why SoldNest was founded. We’re a full-service brokerage with lower commissions.

Below is an image showing how much a seller would pay for the “standard” real estate commissions in California on a $1,500,000 home compared to what they would pay with SoldNest.

 

Silicon Valley Real Estate Commissions

 

Commissions are a fundamental part of seller closing costs in California. When selling your home and discussing commissions with your potential Realtor ®, the most important thing that you should do is ask how much they charge. If they respond with a total commission of either 5 or 6%, then ask if they will do it for less. After all, the worst thing they can say is ‘no’. Some might respond and tell you that their broker doesn’t allow them to. Most of the time though, this is false.

Don’t Compromise On Quality When Selling Your Home

It’s also important to remember in these conversations to ensure you are not getting a lower quality of service. You should be getting a full-service listing agent who will do more than just put your house on the MLS, hold an open house, and have some flyers made. Your agent should know how to structure a specific marketing plan for your home to maximize interest and create the highest possible demand. Doing so can get more buyers interested in your home and help drive the potential selling price higher.  Targeted digital advertising is better today than ever before. There is no reason not to have a customized and tactical marketing plan for the sale of your property. And it shouldn’t cost you extra to do so.

Your agent should know how to structure a specific marketing plan for your home to maximize interest and create the highest possible demand. Doing so can get more buyers interested in your home and help drive the potential selling price higher.  Targeted digital advertising is better today than ever before. There is no reason not to have a customized and tactical marketing plan for the sale of your property. And it shouldn’t cost you extra to do so.

Paying less than the average California real estate commission rate can help save you tens of thousands of dollars. All that you have to do is ask.

SoldNest 1% Listing Fee

Escrow Fees In California

One of the first things your listing agent will do after you sign the listing agreement with them will be to open escrow. It’s customary in California for the seller to choose which escrow company they’d like to use. If you have one that you want to use, you can mention the name and contact info to your listing agent. Alternatively, your agent can do it for you. Working with an escrow company isn’t necessarily the first thing that comes to mind when you think about putting your property on the market. But it is an important part of the final stages of selling a home, and the overall seller closing costs in California.

Alternatively, your agent can do it for you. Working with an escrow company isn’t necessarily the first thing that comes to mind when you think about putting your property on the market. But it is an important part of the final stages of selling a home, and the overall seller closing costs in California.

Working With An Escrow Company

You might ask “Why does there need to be an escrow company?” “Escrow” is a neutral third party that handles the transfer of the deposits, documents, funds, and other things in a real estate transaction. The funds are held in a trust with your escrow officer (escrow agent) until a specific condition or event takes place according to the contract signed by the seller and the buyer. In other words, the escrow company is the party that crosses all the T’s and dots all the I’s in order to protect both the buyer and seller. An escrow officer acts as a neutral third party throughout the entire closing process.  It is important to ensure that the buyer and the seller are both protected as money and property change hands.

For providing their services, the escrow company charges a fee. These are usually referred to as “escrow fees” on your settlement statement. A settlement statement shows the disbursement of your costs as well as your net proceeds. You will see this when you sign the final documents. Exactly who pays the escrow fees in California will depend on which county your property is in.

A rough calculation of the cost is $2.00 for every $1,000 of the sales price, plus $250. So if your home sells for $1,000,000, and you live in a county that requires the seller to pay, you’ll pay an escrow fee of roughly $2,250. Most escrow companies charge around the same amount.

Title Insurance

Another fee that you’ll see on your settlement statement is title insurance. Sometimes title insurance is bundled alongside escrow fees. Title insurance is an insurance policy that protects a party from a financial loss due to defects on the title. There are different policies that cover different things. Typically, a title insurance policy usually protects the party from things such as someone claiming ownership of the property. It can also protect against liens that might pop up during or after the transaction closes. Sometimes in the process of selling a property, it can turn out that more people have a right to ownership than previously thought. Title insurance works to protect against this. For the buyer, title insurance protects against things like potential unpaid debts that the seller may have had, ensuring that they don’t have to take these on.

Typically, a title insurance policy usually protects the party from things such as someone claiming ownership of the property. It can also protect against liens that might pop up during or after the transaction closes. Sometimes in the process of selling a property, it can turn out that more people have a right to ownership than previously thought. Title insurance works to protect against this. For the buyer, title insurance protects against things like potential unpaid debts that the seller may have had, ensuring that they don’t have to take these on.

Title vs. Escrow

A title insurance policy is issued by a title company. Sometimes, escrow companies are under the same umbrella as the title company. Title companies are usually big corporations and many of them are publicly traded. Escrow companies take a lot less capital to start and can be their own separate entity. In Northern California, the escrow company will usually handle the title services. In Southern California, they are usually two separate companies during the transaction.

Similar to how the cost of escrow fees are determined, who pays the title insurance in California depends on the county your property is in. Sometimes the buyer pays for it, sometimes the seller pays for it. In other cases, it can be split 50/50.

Whether the seller pays for it or not, the policy covers the buyer. If the buyer is getting financing, they must also purchase a similar policy that protects their lender.

Not sure what these fees will mean for you? You can use a California escrow fee calculator from Old Republic Title company to get an estimate on what you might be charged based on your sales price.

You can also see a separate breakdown of who pays escrow fees in California

California Transfer Tax

Part of the closing costs for a seller in California is city and county transfer taxes. These are two separate tax payments made to the county and city where the property is located. Every time a property changes ownership, the local governments want a piece of the pie.

Every county in California has a transfer tax except for San Francisco County. The cost of county transfer tax in California is $1.10 for every $1,000 of the sales price. So if your house sells for $1,000,000 and your property is not located in San Francisco County, then the county transfer tax would be $1,100. This tax is another one to be considered in closing costs for a seller in California.

Not all cities in California have a transfer tax. Only some of them do, and the city transfer tax is either paid for by the buyer, the seller, split 50/50 between the two, or is negotiable. Your listing agent should be able to break these costs down for you upfront when meeting with you about selling your property.

The cost for the city transfer taxes varies from place to place. In Santa Clara County, areas San Jose, Palo Alto, and Mountain View all have city transfer taxes. The San Jose areas also include Almaden Valley, Willow Glen, Evergreen, and Silver Creek. The cost is $3.30 for every $1,000 of the sales price. On a million dollar sales price, this comes out to $3,300. For these three cities, the cost is split 50/50 between the buyer and seller. Cities in Santa Clara County that do not have a city transfer tax include Saratoga, Los Gatos, Cupertino, and Sunnyvale.

Real estate city transfer tax in San Francisco operates under its own unique calculation. If your property is in San Francisco County, the chart below will give you an idea as to roughly how much your city tax will be based on your sales price.

City transfer tax in California when selling a home

Miscellaneous Fees As Part Of Seller Closing Costs In California

When you see the final breakdown of your closing costs when signing the final paperwork for your real estate transaction, you’ll notice there are several miscellaneous items. These aren’t anywhere near the cost of the other charges as part of a seller’s closing costs. Even though they take a smaller hit overall on your finances, it is still nice to know what these may include.

Some of the miscellaneous fees might include a notary fee, a recording fee, and HOA fees (if you have an HOA). If you’re paying for any inspections and don’t want to pay them upfront, you can also include these under miscellaneous costs. Adding them as part of your closing costs can help you get a better picture as to how much you’re actually netting from the sale of your property.

Seller Closing Costs In California

In summary, when you sell a home in California, you will have closing costs that you will need to pay. It’s always best to understand what these costs are, and especially how much they are. The answers could help make a decision for your next step in life a bit easier.

If there’s one thing that to take away from this, it’s that real estate commission in California is negotiable. In my several years of experience in the industry, I can’t tell you how many homeowners I’ve talked to who thought that 6% was the standard real estate commission. The Commission is the highest dollar amount of a seller’s closing costs. As a real estate broker, I personally feel that this is way too high and is one of the reasons why I founded SoldNest.

It is the case that real estate search websites such as Zillow and Realtor.com are becoming the initial go-to sites for most buyers in their home search. What this means is that a real estate agent’s job of “marketing” a home has become a lot easier over the last 5 to 10 years.

The point is, you shouldn’t have to pay more than necessary without sacrificing top service.

An Important Resource For Sellers In California

There is a lot of work that goes into selling a property. Sometimes, it can be daunting when you are unsure of what it may mean for you financially. But the good news is that there are tools and resources available to you when selling your home.

Want to get an idea of much you might be paying for in terms of seller closing costs in California? Check out our free California seller closing costs calculator. You’ll be able to get a sense of how much your closing costs as a seller might be. This will allow you to begin preparing for the process of selling your home.

Understanding all of the fees involved in the final stages of your home sale before you even begin is one of many tips for selling your home. It is valuable to understand the ins and outs of every step of the way from the very beginning of selling your home to the end. This includes understanding seller closing costs in California.

If you’re thinking of selling your Silicon Valley home sometime soon and would like to work with a top agent who will provide better service at only a total of 2-3.5% real estate commission, then you can see more about SoldNest here. We’ll provide you with a thorough market analysis of your home without any obligation.

Reverse Mortgages Explained: Is Selling A Better Option?

Selling your home could be more advantageous than a reverse mortgage

For many homeowners, life situations may alter the best financial course of action for them when it comes to keeping or selling their property. Refinancing one’s home may be a necessary consideration, and a reverse mortgage may seem like a viable option.

What is a reverse mortgage?

A reverse mortgage is a type of mortgage through which a homeowner can borrow money against the value of their home. They receive funds in the form of a fixed monthly payment or a line of credit. There is no repayment of the mortgage that is required until the borrower dies, moves away or puts the home up for sale.

It is set up so that the amount of the reverse mortgage will not exceed the value of the home over the course of the loan.

They’ve been around for decades but recently people have become more and more aware of them as a potential debt instrument for homeowners. Reverse mortgages are sometimes cast in a negative light. The financial community as well as the media has been known to be skeptical of them.

Despite this, though, reverse mortgages have become increasingly popular amongst people who are “house rich and cash poor.” This is particularly true of many senior citizens who need additional income to pay for health or long-term care

How do reverse mortgages work?

Reverse mortgages function in the opposite way of a traditional mortgage. With a traditional mortgage, a homeowner borrows money from a lender when they purchase a home. They then make monthly payments to the lender to pay off the balance, while simultaneously building equity in their home. As time goes by, the homeowner lowers their debt by contributing to their mortgage, and in doing this, they increase their home equity increases. Once the mortgage is fully paid, the homeowner officially owns the home outright, never owing anything further to the lender.

A reverse mortgage, as the name suggests, works in the opposite way. Instead of making monthly payments to a lender, a homeowner receives monthly payments from them based on a percentage of the value of the home. This can be paid as a single lump sum. It can also be paid as a regular monthly cash advance that is paid for either as long as the homeowner lives in the home, or based on a certain number of years. Alternatively, it can be paid as a line of credit, or a combination of these options.

Regardless of how the reverse mortgage is set up, the homeowner will keep the title to their home. This serves as collateral for the loan. The homeowner is charged interests solely on the proceeds they receive. Both fixed and variable interest rates are available. Any interest will compound over the span of the reverse mortgage until repayment happens.

The long run

Over time, debt will increase while home equity will decrease for the homeowner. When the homeowner moves, sells the home or passes away, the lender will sell the home to regain the money that they would have paid out.

Once lender fees have been paid, any remaining equity in the home will be received by the homeowner, or in the case of death, by their heirs. In some cases, an heir will have the choiceto repay the mortgage without actually selling the home. According to the Federal Trade Commission, if the homeowner receives more payments than the home is worth, they will never owe more than the value of the home.

Should the homeowner fail to meet the obligations of the mortgages, for example, if they do not pay their taxes or insurance, or if the property falls into a state of disrepair, the reverse mortgage could become due. The homeowner is responsible for paying property taxes, homeowners insurance and for the overall maintenance of their home. But if the value dips lower than the amount the homeowner has borrowed for other reasons, such as a decline in the real estate market, the homeowner can’t be foreclosed upon.

What are the different types of reverse mortgages?

There are multiple kinds of reverse mortgages available. These include single-purpose reverse mortgages, federally-insured reverse mortgages and proprietary reverse mortgages.

Single-purpose reverse mortgages

Single-purpose reverse mortgages are usually aimed toward low to moderate income homeowners. The lender of this type of reverse mortgage decides how it can be used. It may be used to pay property taxes or to go toward repairs to the home.

Federally-insured reverse mortgages

Federally-insured reverse mortgages are also known as Home Equity Conversion mortgages. They are issued by private banks. Home Equity Conversion mortgages are insured by the Federal Housing Administration. They are the only reverse mortgage product that is guaranteed by the federal government.There are no restrictions in terms of income or medical conditions. There are also no regulations as to how the money from these types of mortgages can be spent. The main downside, though, is that for this type of reverse mortgage, the maximum loan amount is limited. At the moment, it Is limited to the lesser of the appraised value of the home or the HECM FHA mortgage limit of $625,500.

Proprietary reverse mortgages

These types of reverse mortgage can also be accessed from various lending organizations. They offer amounts that are higher than HECM loans, but the difference is they are not federally insured. They can also be significantly more expensive. Homeowners with homes of higher value will find these types of mortgages the most advantageous.

Pros and cons of reverse mortgage

As with most financial decisions, there are many pros and cons to consider. Here are few of the positive aspects as well as drawbacks to getting a reverse mortgage.

Pros

  • For a homeowner planning to stay in their home, a reverse mortgage can be a good, reliable source of cash flow.
  • It’s easier to qualify for a reverse mortgage than a traditional mortgage. This is because your credit score does not play a role in your application. In addition, you only need enough income or assets to continue to pay for things like homeowners insurance, property taxes and costs associated with maintaining your home.
  • For seniors, there are no taxes on the money that they get from a reverse mortgage. Since it’s not considered income, it’s not taxable.

Cons

  • The interest generated by the loan is not tax-deductible over its term. The only way that it can be deducted is when the loan is fully paid off.
  • Reverse mortgage loans can actually be more expensive than they appear at first. In addition to interest, reverse mortgages have a lot of fees and extra costs, such as mortgage insurance. These extra costs can add up quickly.  Sometimes it comes to the point where they are actually more expensive than regular mortgage fees. (To avoid this, it may be suggested to take out a reverse mortgage as a line of credit as opposed to a lump sum payment. By doing this, the homeowner only pays the interest and annual insurance premiums in the amount that is actually being withdrawn).
  • HECM sets loans on how much you can borrow from a reverse mortgage, particularly in the first year
  • Reverse mortgages use up equity in your home
  • Homeowners and their heirs will be left with fewer assets
  • Homeowners will not be able to give or sell their home to their children during their lifetime without repaying the mortgage first.

Selling your home vs. getting a reverse mortgage

For homeowners that are considering refinancing their home for additional income, there’s another option. They may consider selling their home altogether. For a homeowner who is willing and able to move, this could be advantageous. Selling gives the homeowner the ability to leverage the equity that they have built from their property.

Selling could be a better option anyway if the home is too big for the homeowner’s current needs. Many people decide to downsize after children grow up and move into homes of their own. Furthermore, if the current home is costly to maintain, or has high property taxes, moving into a smaller home may be a better option. Proceeds from the sale of the original home can be used to finance a smaller and more affordable home.

Another option for homeowners considering a reverse mortgage is to sell their home to their kids. A sales-leaseback agreement allows homeowners to sell their house. They then rent it back to using money generated from the sale.

The bottom line

Whichever route a homeowner decides to take, it is important to carefully evaluate the pros and cons as well as the financial implications of their decision. While reverse mortgages may be beneficial for some, selling may be a better and more lucrative option in the long run if it is affordable.

If after assessing your financial situation, selling seems like the best option for you, SoldNest can help. We provide expert real estate insights and digital marketing expertise for your property at just a 1.5% fee. We can maximize your final sales price while saving you money.

How Smart Home Technology Can Help Sell Your Home

Smart home technology can be highly appealing to the next generation of buyers

Considering how smart home technology can help sell your home is a new and exciting possibility in the world of real estate. It’s unique to this day and age. But by 2020,  projections show that more than 30 billion devices will be part of the “Internet of things.”

The primary motivation for most people to invest in smart home technology is safety. But many people also want to make their home more energy efficient and convenient.

As a seller, there are several possibilities as to how smart home technology can help sell your home. Smart home technology can be a noteworthy advantage to your property that is likely to be well received by many prospective buyers. This is especially true in a tech-fueled area like Silicon Valley.

What is smart home technology?

Smart home technology includes everything from heating and cooling controls to lights, appliances and keyless entry systems, all controlled remotely by a smart phone or tablet. The overarching goal is to make life easier and safer, while saving money on utility bills. All of these points can be highly appealing to a buyer looking at your property.

How smart home technology can help sell your home to millennials

The generational appeal is also strong. More and more millennials are breaking into the real estate market and looking for their first home. This generation and Gen X’ers that came before them love smart home technology for the convenience and security it provides. In fact, studies show that 72% of millennials would pay $1,500 or more to add smart features to their home. And 44% would invest over $3,000 to transform their current home into a smart one.

If you’re targeting a millennial or Gen X homebuyer, it is very likely that adding smart technology to your property before you put it on the market will be advantageous. These features can serve as a great selling point when showing a buyer your property.

And the good news is, you don’t necessarily have to do a full home makeover. Even just adding a few smart home features can be useful selling points for your property.

We’ve consolidated a list of the most popular smart home features available right now for you to chose from:

Smart security

  • What is it? Smart security includes features like cameras, keyless locks, motion sensors, smart door and window sensors.
  • Why it’s a selling advantage: You can assure your potential buyer that they will have control no matter where they are. They can eliminate worries about things like the garage door being left open, because it’s all controlled remotely. Smart locks will save them the trouble of having to cut extra keys. Security cameras will allow them to have better visibility into their home while they’re out. This is especially advantageous if they have children or pets.
  • How to install it: There are many smart home security installation tips and tricks available online, like this step-by-step guide to installing a keyless lock.
  • What’s on the market now: For a keyless lock option that will work with your current deadbolt, check out the Augusta Smart Lock. As far as smart security cameras go, the Nest Cam Indoor provides 24/7 live video, and sends notifications when it detects activity.

Smart thermostat

  • What is it? Similar to smart security systems, smart thermostats work via smart phone or tablet. This means you can adjust your home temperate no matter where you are.
  • Why it’s a selling advantage: Smart thermostats allow you to save on energy bills. When asking yourself how smart home technology can help sell your home, lower bills will likely appeal to any buyer. With smart thermostats you can adjust the temperate of your home to your habits and daily routine. And you can do it from anywhere. All you need is an internet connection.
  • How to install it: A smart thermostat is a feature you can install yourself in a few easy steps.
  • What’s on the market now: Unrivalled by its competitors in terms of specs and capabilities, the Ecobee4 includes responsive display, remote sensor technology and built in compatibility with Amazon Alexa.

Adding smart thermostats are one way to use smart technology to sell your home.

Smart lighting

  • What is it? Lighting systems that are controlled remotely by smart phone and tablet. But with the added bonus of being able to adjust themselves depending on natural light and weather pattersn. Smart bulbs are more expensive than regular light bulbs, but they last longer and are more energy efficient.
  • Why it’s a selling advantage: Smart lighting brings many benefits when it comes to how to use smart home technology to sell your home. Smart lighting can allow for a better sleep. (Lights can automatically adjust to time of day and can aid the natural production of melatonin). They can create a better mood by adjusting to darkness in winter months and according to the weather. Smart lighting also provides increased security. You can program it to behave in a way that makes it appear that you are always home. You can also point out to your buyer that they will be saving money on energy bills from motion activated lights.
  • How to install it: There are many different ways to outfit your property with smart lighting, and a few considerations to take in mind when beginning the installation process.
  • What’s on the market now: The Philips Hue White and Color Ambiance Equivalent Starter Kit creates light of multiple colors throughout your home and can be controlled by voice.

Controllable shades

  • What are they? Blinds or shades that operate via smart phone or tablet. They can be set to go up or down at certain times of the day.
  • Why it’s a selling advantage: One major benefit of controllable shades is convenience, especially for windows that are more difficult to reach. It’s possible to set smart shades to open when it’s time to get up. They function as a natural alarm clock. Furthermore, they will save on energy bills by having shades open or close depending on the time of day to maximize on natural light. They also have the added security benefit of being able to adjust when you’re away, making it look like someone is always home.
  • How to install them: Handy YouTube tutorials show you how to put controllable shades up in a snap.
  • What’s on the market now: Smart Shades are not only controllable by smart phone or tablet, they also run off of solar power.

Emphasizing your selling points

So, you’ve outfitted your house with these products and are ready to put your home on the market. But what do you and your real estate agent need to know to create compelling selling points for your possible buyer?

Smart home technology can be entirely controlled by smart phone or tablet.

First, you will need to fully understand the system and its features. You have to be able to talk confidently about these products and why they are a great addition to the home. The more comfort and familiarity you and your listing agent have with these products and how they work, the more trust you will build in your buyer. You’ll be able to answer their questions and make them feel at ease.

Putting together a short guide could also help. It’s something your buyer could potentially take away and read on their own about the smart features in your home. Since this tech is new to most people, millennials included, it will help persuade a potential buyer who may be reluctant because they think the smart technology is too complex.

Talk about privacy

Since smart home technology backs up to the cloud, there may be concerns around privacy when transitioning from one home owner to the next. Being open about this with your buyer will make them feel more at ease. Refer to the checklist from the Online Trust Alliance for a breakdown of steps you and your buyer can follow when it comes to transferring ownership of your smart home to keep both parties’ personal information safe.

Getting ready to sell your smart home

The advantages of smart home technology are undeniable, from energy savings to increased security. Having a real estate agent who knows how to market your property to the right audience, and can confidently explain the advantages of your smart home technology will allow you to sell your home for the best possible price. A customized marketing plan is critical to success, and is just one part of the selling process that can save you thousands with SoldNest.

Sell your home for the highest price at only a 4% real estate commission

Maximize Your Sales Price Using Feng Shui to Sell Your Home

Stage your home for sale by implementing feng shui

Many people are somewhat familiar with the ancient practice of making a space more harmonious, but there are many ways to use feng shui to sell your home. Feng shui, as well as vastu shastra, both focus on the importance of creating a balanced, tranquil home environment.

When it comes to staging any home as a seller, an important thing to remember is that you want your prospective buyer to envision themselves living in your space.

If your buyer is someone who practices feng shui or vastu shastra, having a space that caters to these systems can be beneficial. For instance, what if you buyer was torn between putting an offer in at two different places they viewed? Chances are, if they are followers of either feng shui or vastru shastra, they will prefer a home that appears to be set up according to these principles. They will likely be more able to envision themselves in that space.

From this, you’ll have created an emotional attachment with the buyer, and therefore will be more likely able to increase your final sales price.

But first, let’s start from the beginning.

What is feng shui?

Feng shui is the Chinese philosophical system of harmonizing everyone within the surrounding environment. In English, it literally translates to ‘wind-water’, and has close ties to Taosim.

Feng shui looks at architecture in a metaphoric lens, wherein invisible forces bind the universe, earth and humanity. This is known as qi. Feng shui incorporates five elements, which are fire, water, earth, wood and metal.

In the past, feng shui was used to orient buildings of spiritual importance, like tombs. But it has since evolved to being practiced in many different buildings, including in houses.

Finding out whether a building has good feng shui essentially involves testing the architecture or set up using a collection of metaphors. The test may be static, or some kind of  stimulation.

For example, a test might involve moving an imaginary person or creature like a dragon through a floor plan to uncover tight turns and tiny spaces before a building is actually built.

Similarly, when thinking about feng shui to sell your home, it’s important to make sure that a buyer can easily pass through an area. You will want to create easily followable, open pathways and make sure you don’t make buyers feel claustrophobic.

What does feng shui look like in a home?

If you’re thinking of using feng shui to sell your home, you may find that some of your property’s features are hard or impossible to change. One example is a staircase that directly faces the front door. While this is considered bad luck according feng shui, it is something that homeowners can do little about without undergoing a major renovation.

Despite this, there are ways to add feng shui to your home without having to undergo changes to the overall structure of your house.

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How to get started with feng shui when selling your home

First, you will need to look around your home and figure out which rooms need feng shui the most. It’s tempting to focus on an already ‘good looking’ areas that you spend the most time in, such as the kitchen or living room, and ignore somewhere that might be a lot of work, like the laundry room or garage. But really, you should be focusing on the latter, especially when considering feng shui to sell your home.

Why? According to feng shui, the house is one entity, and it’s all about energy. One area that is neglected can eventually spread negative energy throughout the rest of the house.

Start with the main entry

When you’re getting ready for your first open house or viewing, make sure that your front door is the main point of entry. According to feng shui, the front door is how qi comes into the house. Although many houses are designed so that people can go in directly from the garage, one good feng shui tip is to make a habit of coming and going through your front door – something to keep in mind when inviting viewers to see your place.

Create a ‘landing’ place  that is noticeable as soon as people walk in your front door. This could be a table with a nice lamp on it. A beautiful rug will also do the trick.

Place some type of fountain near your entry way to represent the element of water. It can be right inside or outside, so long as the water itself is flowing toward the entry to your home. The idea here is that wealth will be able to flow into your life, and will give prospective buyers a sense of how they can do something similar when they move in.

Little details matter

Making buyers feel like they belong in your home from the minute they arrive is important. Make sure that when they arrive in the next space of your house, the furniture is arranged so the backs are not toward the person entering the room. Instead, you want to create a space that is visually inviting.

Make sure to fix any squeaking hinges on your entry door. This sound is something you will hear at the beginning and end of each day, and your buyer, when coming to visit, will notice too. Since the entry way is such an important aspect of the practice, it makes sense to focus on every little detail if you are implementing feng shui to sell your home.

Staging a bedroom for good feng shui to sell your home

The location of the bed in the bedroom is important. The ideal situation is to be facing your door, but not in line with the door, while lying in bed. (Having the bed at a diagonal to the door would be best, but it’s not always feasible). So, to address this, simply find a mirror and adjust it so that it is possible to see the front door from the bed. Free-standing mirrors are useful for this because they are easy to move around. This way, when staging your home, a potential buyer can clearly see how they too could set up the same bedroom for good feng shui.

If there’s a TV in the bedroom, cover it. You want the bedroom to exude a space of quiet and calm. It’s a reality now that many people do have TVs in their bedrooms. If you can’t get rid of your TV before putting your house on the market, cover it with a pretty piece of fabric. Make sure that any images on the walls are calm and soothing, like landscapes. As with any home staging, no family photos or personal objects should be on display when preparing to sell your home.

Feng shui in the kitchen

Check out your kitchen cabinets. It’s not ideal for feng shui to have space between the top of your cabinets and your ceiling. This is because this space collects dust, which can attract negative energy.  If you do have space, adding plants on top of your kitchen cabinets will help bring good feng shui.

What about other rooms in the house?

In the bathroom, try to have multiple sources of lighting, and mirrors. Keep the room warm.

Keep the bathroom door shut and toilet seat covered. Most real estate agents will tell you to make sure your toilet seat is closed before a viewing any way. So, what does this have to do with feng shui? It all goes back to the five elements. The bathroom is water’s way out of the house, and water is connected to wealth.

If you have a home office, it should ideally be as far away from your bedroom as possible. The design or decor should encompass the ideas of success, well-being and productivity. Make sure that you are mindful of the quality of air and light that come into the office as well. This is something prospective buyers who adhere to feng shui are likely to notice when looking at real estate.

One final but important tip if you are staging and using feng shui to sell your home: clean your windows. They represent the eyes to the world, and you want them to be as clean as possible in order to show your seller that they will be able to see and experience everything.

What is Vastu Shastra?

Vastu shastra is a practice from ancient India that involves finding harmony and prosperous living.  It focuses on eliminating negative energies and enhancing positive energies around us. Many people of Indian and Hindu descent still practice it today.

The idea behind vastu shastra starts with the fact that humans spend most of their time inside, be it in their home or their office. Every environment has some kind of energy to it. People will experience both negative and positive energies in places that they visit. We are constantly surrounded by different energies 24/7.

Vastu shastra aims to make buildings more in line with nature to make people happier.

Directions are very important, and can be good or bad depending on the room or piece of furniture in it. Many vastu shastra best practices dictate rooms and large appliances to be in or face certain directions. But this can be difficult or not feasible to change when selling your home. So, what can you fix?

How to add vastu shastra to your home’s bedroom

Make sure that the bedroom is not in the South East of the house. This area is associated with fire. If this is the case for your home, there is a possible solve. Before a viewing, consider the furniture’s layout in the bedroom. Set up the bed to show that someone could potentially sleep with their head toward the south and feet toward the north. This will lessen the negative effects of the room being in the south east.

Don’t have mirrors in your bedroom, as they are associated with misunderstanding and quarrelling between couples. If you can, avoid having beds in the centre of bedrooms.

Since the South brings a deep sleep and ensures longevity, while the East brings enlightenment, the best way to position a bed in a bedroom is to have the head of the bed facing the South or East. Make sure there is no window directly behind the bed.

Vastu shastra in the rest of the house

It may be hard to alter the direction of your appliances to be completely in line with vastu shastra best practices. But there are other things you can do instead.

In the kitchen, Avoid the colour black on the walls, instead use yellow or rose. Avoid clutter, and make sure that your food, grain and utensil storage doesn’t create any mess. Ideally, store things in the southern or western side of your kitchen. The north east side is perfect for storing any type of water vessel.

In the bathroom, your walls should be light in color. Luckily, a new coat of paint before staging a home can be both budget friendly and extremely effective. It’s something that would be recommended to most sellers anyway, regardless of their practices.

In the home office, make sure the space is well lit, and ideally, with light coloured walls. Avoid clutter and ensure that there is space in the centre of the room. If you can, put bookshelves on the north, east, or north east side of the room

In the living room, paintings or pictures on the wall of waterfalls or the rising sun provide positive energy. Avoid images of animals or birds. Ideally, the colour of the walls will be yellow, white, blue or green. If possible, ensure that all furniture is square or rectangular.

Feng shui and vastu shastra in Silicon Valley

Chinese and Indian homebuyers make up a considerable portion of the real estate market in some metro areas like Silicon Valley.

When selling a home, things like the property condition and upgrades make it more attractive to potential buyers. Tie in some elements of feng shui or vastu shasta, and you have a space that appeals even more greatly to a significant percentage of people looking at homes. This, along with ensuring your home has maximum exposure on the market, will ensure that it sells for highest possible amount.

As a homeowner, you will likely work with a real estate agent. They can help you figure out how to use vastru shastra or feng shui to sell your home. They should be able to work with you to see how you can go about addressing or improving areas of your space that may not be fully in line with the principles of these ancient schools of thought.

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What Does Contingent Mean in Real Estate?

Real estate contingencies are important to understand for both buyers and sellers

Understanding the answer to what does contingent mean in real estate is critical whether you’re a buyer or seller. It’s undeniably a pivotal part of the home selling and home buying process.

So, exactly what does a contingent offer mean in real estate? A contingent offer occurs when an offer on a home has been made by a home buyer and has been accepted by the seller, but the contract has certain criteria that must be met to finalize the transaction.

For a contract to be binding, a condition put into the contract needs to be met first. This is also referred to as a contingency.

In this article,  I’m going to outline everything you need to know about contingencies. This includes how real estate contingencies can protect you and how you can use them as leverage when selling or buying your home.

How Many Contingencies Can be in an Offer?

Technically, there can be contingencies of any kind in a real estate transaction. But there are three you’ll be most likely to hear about. These include an inspection contingency, an appraisal contingency, and a financing contingency. These contingencies are standard on the purchase contract in California, and are also common in most other states.

Sometimes, a buyer makes an offer on a home for sale that is contingent on the sale of their current residence. This type of contingency isn’t as common, particularly when market inventory is low and demand for homes is high.

This type of market is known as a seller’s market. It generally means there are more buyers than there are homes for sale. Because of this, buyers need to stay competitive with their offer. This is due to the fact that sellers often will have several offers to choose from. This usually means that a buyer won’t be placing a contingency that would take up more time for the seller. The sale of a buyer’s current residence that is placed as a contingency in an offer is usually more common in a less competitive market.

How do Contingencies Work in Real Estate?

When a buyer is thinking about putting an offer on a home, the first thing they do is their homework. This includes researching nearby recent sales, and requesting to look at all of the seller’s disclosures, reports, and inspections. Most buyers will ask their agent to gather this information. Then, the buyer and their agent will thoroughly go through and do as much research as possible.

When the buyer is ready to put the offer together, they’ll discuss which terms they would like to include. The two biggest ones involve price and the contingency periods. In California, there are standard time frames for the contingencies – but the buyer has the option to reduce the timeframes, or waive them altogether.

When selling your home, you shouldn’t only look for the highest price being offered. You should be looking at the contingency periods as well. Sometimes the highest price isn’t always the best offer.

Here’s an example to illustrate this point. Imagine a scenario in which two prospective buyers have placed an offer on a home. One buyer offered $1,250,000 and waived all of their contingencies. The other buyer offered $1,260,000, but kept their inspection and appraisal contingency.

Real estate contingencies should be considered along with price when evaluating offers from buyers.

Which one would the seller be more inclined to accept? The seller’s agent should be going over the details, including pros and cons in a scenario like this, but this is an example where contingencies in a real estate transaction can influence a seller’s decision on an offer.

Where Escrow Comes In

One of the biggest effects and influences of contingencies in a real estate transaction has to do with the escrow deposit. This is not only the case in California, but also in many other states across the country. When the contract is ratified, the buyer needs to put a deposit in escrow within 72 hours. This is because 72 hours is the default timeframe, but this can be cut down to less time if the contract says so. This deposit is usually 3% of the purchase price and is applied to the buyer’s down payment.

There’s a key piece of information to note if you’re a buyer. In order to have your offer look a little more enticing to the seller, state that you’ll deposit the 3% within 24 hours. If you’re a seller, your agent should be a little aggressive. They may see if they can get the buyer to make the escrow deposit within 24 hours instead of the standard 72.

Once the buyer removes their contingencies, their deposit can be at risk. This means that if the buyer wants to back out of the transaction after releasing their contingencies, then they may be at risk to losing their deposit to the seller.

If the buyer still has contingencies in place, and wants or needs to back out for a specific contingency reason, then they can do so and get their deposit back. You’ll want to confirm what is specifically stated in your contract. Your agent should be able to go over this with you.

Next, let’s break down each of the big three contingencies in real estate that are the most common.

Home Inspection Contingency

The home inspection contingency refers to the timeframe allocated for the buyer to do any and all of their inspections. This includes having their own home, termite, roof, or pool inspector come out to the property. It also includes bringing a contractor out to the home. Any other type of inspection the buyer wants carried out would also fall under this real estate contingency.

When selling a home, the seller needs to disclose as much information about the house as possible. Anything and everything they know, whether good or bad, will need to be detailed in standard disclosure forms.

The seller’s agent will provide these standard disclosure forms to the seller to fill out. These disclosure forms, along with any reports and inspections the seller has done, should be put together by the seller’s listing agent. They should be easily accessible for any buyers and their agents by the time the house goes up for sale. This can be done in several different ways. Some examples include putting a link directly on the MLS that only other agents can access or having a Dropbox or Google Drive link ready to share. They can also be sent via email with attachments.

Along with the disclosures, the seller will need to provide certain reports. The two most common ones in California are the title report, also known as the prelim (short for preliminary title report), and the Natural Hazard disclosure.

Preliminary Title Reports and Natural Hazard Disclosures

The title report is the legal description of the property. It documents who the current owners are, any liens on the property, and encroachments. It also documents easements, the current tax rate and instalments for the current owner, as well as how the current owners are vested.

The natural hazard disclosure is a report that is required in the state of California that the seller must provide. The disclosure will state if the home being sold lies within a hazard area. There are six of them that must be disclosed. They include a special flood hazard area, and dam inundation. They also include very high fore zone, wild land fire, earthquake fault zone, and a seismic hazard. As a side note, if the property does fall within one of these hazard areas, most lenders will require extra insurance that the buyer will need to purchase.

A natural hazard disclosure is a report that is required along with any disclosures that are part of the home inspection contingency.

In addition to providing the required disclosures and reports, the seller has the option to have any inspections done on the property that they’re selling. If you’re a seller, you might be thinking that this is a waste of money. In fact, the opposite is true.

Two Reasons For Getting Inspections Upfront

It’s in your best interest to complete inspections on your home upfront for two reasons. One, if there are any major problems that arise from these inspections you will know about it and decide if you want to tackle it before you put the house up for sale. But the second reason, in my opinion, is the most important. The buyer will have the opportunity to see these inspections before writing their offer. This is huge and can pay off for you in a big way.

If you’re a home buyer and you’re doing your research on a home that you’re interested in, wouldn’t you be a bit more educated on the property and be able to make a more informed decision on your offer because you have this information upfront? Chances are, you would – and most buyers do.

In California and especially in Silicon Valley, home, termite, roof, and pool inspections are the most common. Again, these are optional for the seller, and either way, the buyer will have the option of doing their own inspections once the contract is ratified. But it’s in everyone’s best interest if these are provided upfront.

A Firsthand Example

As a seller, your agent should be able to leverage these inspections and negotiate a better offer. I just sold a house in Almaden Valley, which is an upscale neighborhood in San Jose. My clients were adamant about not doing inspections upfront. They purchased their house in 1985, and said when they bought it, the seller didn’t provide any inspections and that they had to pay for them. Why should they have to conduct inspections for a new owner? I explained how the buyer would most likely include a home inspection contingency in their offer if we didn’t provide one upfront. Eventually, they decided to get a home and termite inspection.

Both reports came back very clean, with only the home inspection having a few minor recommendations. Because we had the inspections upfront, this helped the buyer feel more comfortable in writing the terms of their offer. This also helped me negotiate their offer $100,000 above our asking price without any buyer contingencies. The buyer did all of their homework and decided to use our inspection reports in their decision of waiving their contingencies with their offer.

Needless to say, having these inspections done upfront helped the seller get an offer that they may not have without them. It also helped the buyer get their offer accepted on a home that they really love.

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Appraisal Contingency

An appraisal contingency refers to the time frame the buyer has to not only have their appraisal completed, but more importantly, signed off by their underwriter at their lender.

In a hot market (like the one we’re in now in Silicon Valley), also known as a seller’s market where the supply of homes for sale is very low and buyer demand is very high, it’s not uncommon for a buyer to reduce or even waive their appraisal contingency.

An appraisal contingency usually only applies to buyers who are getting financing. But it can also sometimes be a part of the contract in an all cash transaction. This, however, is not that common.

An appraisal is required by every lender and is a condition on the buyer’s loan, as the house is the collateral for the loan amount the buyer is requesting. The bank wants to make sure that the house is worth what the agreed upon sales price is.

The appraisal contingency is not only important for the buyer, but also for the seller too. If the house does not appraise for the sales price and the buyer has an appraisal contingency in their offer, then three things could happen. One, the buyer can try to renegotiate the price. Two, the buyer can pay the difference. Or three, the buyer can back out of the transaction.

The Importance of Comparables

If you’re a buyer, you want your agent to pull comparables and do their homework. They will want to look at what has recently sold in the area before writing your offer. A good agent will not only pull the comps, but will also make adjustments. This is similar to what an appraiser would do. When comparing the subject property to what has recently sold, some of these comparables might include the condition of the home and the location of the home on the street. Why is the location on the street important? If a home is on a corner, by a stop sign, or on a busy street, the value can be 3-10% less than it otherwise may be. Comparables may also include certain upgrades to the property, as well as proximity to good schools.

You and your agent will also need to take into account the most recent trends in the neighborhood. Is there a very low supply of homes, and are they selling quickly? If so, then you should factor in a small percentage increase in value compared to a home that sold 3-6 months ago. Doing your homework and working with an experienced agent who knows how to make these adjustments can only help you in making a more educated decision on your offer price.

What Happens if the Appraisal is Lower than the Sales Price?

A lender will only use the sales price or the appraised value, whichever is less. A lot of the time, the appraisal will come in at or right around the purchase price. The appraisers get a copy of the purchase contract before they go out to the house. If the value of a home cannot be justified with surrounding comps, then the appraised value may very well be less than the purchase price.

When this happens, the lender will use the appraised value as the amount that they’ll lend on. For example, if the buyer and seller agreed upon a $1,200,000 purchase price and the appraised value comes in at $1,150,000, then the lender will lend on the $1,150,000 – not the $1,200,000. In this scenario, the buyer does not pay the full difference of $50,000. This is a source of confusion for many.

If the buyer planned on putting 20% down on $1,200,000, that means they planned on a $240,000 down payment. If the value from the appraisal comes in at $1,150,000 and this is what the lender is going to lend on, then that means tehy’ll need to pay 20% of $1,150,000 (which is $230,000) plus the difference of $50,000. This means that your down payment would be $280,000. In other words, if the appraisal comes in lower than the purchase price, then the buyer will need to come up with 20% of the appraised value, plus 80% of the difference between the appraised value and purchase price.

What Does This Mean?

If you’re the buyer in this scenario, this means you will now need to put down $280,000, which is $40,000 more than what you anticipated. This is why having a good agent to assist you with justifying your offer price in a seller’s market is important. In many cases, the offers are above the asking price. If you’re waiving your appraisal contingency, (which many buyers do in a hot market), then you want to be sure that there’s a good chance that your offer price can be justified by recent sales and the necessary adjustments.

If you’re a seller and you receive an offer without an appraisal contingency, your listing agent should be doing a lot of vetting on the buyer. They should be doing this anyway, but more so when an offer comes in without an appraisal contingency.

Why Vetting the Buyer is Important

Let’s say you’re selling your home, and you get an offer for $1,500,000. Your agent gets the offer, the signed disclosures and reports, the buyer’s pre-approval letter, and proof of funds for the 20% down payment. In Silicon Valley, submitting these items with an offer are pretty standard. In other parts of California and in other states, it’s not as common.

Now, let’s say you accept the offer. Next, the buyer puts down their escrow deposit and the lender orders the appraisal. But the appraisal comes in at $1,440,000. Does the buyer have enough funds to pay the difference? You and your agent aren’t sure, because your agent didn’t confirm this beforehand.

Your listing agent should always ask the buyer’s agent if the buyer has any more funds. They should also ask what happens in a scenario where the appraisal comes in less than the purchase price. If the buyer only has enough funds for the 20% down payment, then this is something you’ll need to take into consideration when looking at their offer.

Loan Contingency

A loan contingency, also known as a financing contingency, is the time frame the buyer has to make sure they’re getting the loan.

A loan contingency is not the same thing as a pre-approval. When a buyer removes their loan contingency, they’re just about 100% certain that they will have no issues with the loan.

When a buyer receives pre-approval, they usually submit their most recent pay stubs, tax returns from the previous two years, and their most recent bank statements along with their loan application. Depending on who the lender is, the loan officer may issue a pre-approval. In other cases, it will come directly from an underwriter. It’s ideal if the buyer gets the pre-approval after having an underwriter look at their initial loan documents.

The underwriter is the person at your bank who is looking over all of your loan documents. They are the decision maker. A pre-approval will still have outstanding conditions such as the purchase contract, appraisal, and title report, among others. But when the pre-approval comes directly from the underwriter, all parties involved can be a little more confident that the buyer will be able to obtain financing.

What Happens Next?

After the contract is ratified, the first thing the buyer and their agent will want to do is tell the loan officer of the offer’s acceptance. The loan officer will start the loan process right away. First, they will need a copy of the contract, the title report, and the escrow company information.

At this point, the buyer’s loan is conditionally approved. This means the lender is going to approve them, but only after they meet a certain number of conditions. Once they meet all of these conditions, then the lender will draw the loan documents and get them ready for the buyer to sign. This process can take anywhere from 20-30 days.

When the buyer releases their loan contingency, they want to be 100% certain that there will be no issues with the loan. Before a buyer waives their loan contingency, they should have a discussion with their loan officer. They will want to tell them that they’re removing their loan contingency and will also want to make sure that the loan officer gives them the green light.

As a seller, your listing agent should be doing a lot of vetting when you receive an offer. Much like asking for proof of additional funds, the seller’s agent should make a phone call to the loan officer and have brief discussion with them about the buyer’s financing situation. This can give the seller and the listing agent a clearer picture on how just how well qualified the buyer is.

What Does Contingent Mean in Real Estate?

So, how does one sum up the answer to the question “What does contingent mean in real estate?” The biggest takeaway to remember? You shouldn’t count on the transaction being close to complete until the removal of all of the contingencies.

Contingencies in real estate are important for both buyers and sellers to consider.

If you’re a buyer, make sure to do your homework and have contingencies in your offer. This of course could vary depending on what kind of market you’re in. Regardless, I always suggest to my clients that they should have an inspection contingency at the very least. And depending on the situation, I almost always suggest an appraisal contingency as well. In a tumultuous seller’s market, like the one Silicon Valley has been in for some time, often the buyer doesn’t have a choice but to waive all of their contingencies. In a neutral market or a buyer’s market, the opposite is true. Because the number of homes for sale is higher than usual and the demand isn’t as high, home buyers have more leverage.

What You Should Do as a Seller

If you’re a seller, make sure your listing agent is doing a considerable amount of vetting on the buyer and their offer. Make sure they’re calling the loan officer for the buyer before you decide which direction to go with the offer. Also make sure they’re playing through every scenario. For instance, if the appraisal comes in short and there’s no appraisal contingency, can and is the buyer willing to pay out of pocket? Do they have pre-approval from an underwriter? Or did a loan officer issue it?

As a seller, your listing agent’s job is negotiate the best possible terms in the offer you accept. This doesn’t always mean price. Sometimes, an offer with strong contingencies, but lower price compared to another offer can be better. One important thing to remember: don’t celebrate until all contingencies are released from the buyer. In fact, don’t celebrate until your home sale proceeds hit your bank account. Never count on the sale of your home almost being completed until the buyer has released all of their contingencies and the appraisal is completed without any issues.

If you’re thinking of selling your home and live in Silicon Valley, your neighborhood SoldNest agent can sell your home for more and save you thousands. Not only can we help ensure you receive the best possible offer in terms of both price and contingencies, but we also provide better overall service and marketing – and only charge a 4% commission. To see what your home might sell for, we’ll provide you with a thorough market analysis. You can request one here.