If you’re considering selling your home in Delaware, there’s good news and bad news to consider. First, the good news: Property values here have been skyrocketing. Data from Delaware Realtors shows the state’s median sale price was $350,000 in August 2022, an increase of more than 18% in just one year. Now, here’s the bad news: The housing market is cooling rapidly as mortgage rates skyrocket. As a result, homes in the state are staying on the market longer and active available inventory has increased.
While it’s still technically a seller’s market, selling a home in the first state is becoming more and more challenging. Plus, it’s expensive to sell a home here: According to ClosingCorp, closing costs in Delaware average 5.4% of the purchase price in 2021, largely due to the state’s high transfer taxes. So before you plan to sell and move to a new location, read on for our full guide on the steps you need to take when selling your home in Delaware to minimize costs and maximize profits.
Are you ready to sell?
As economic jitters continue to grab the headlines, you may be trying to answer a fundamental question: sell now or wait? If you’re thinking about waiting, hoping your property values will continue to soar, you might want to think again: a new forecast from CoreLogic suggests house prices will rise 3.2 per cent next year.
Also, figure out if you should list more things than your current possessions. You also need to think about where to go next. If you’re looking to sell your home and buy another at the same time, you need to be prepared for the challenges of high mortgage rates and limited inventory. If you’re planning to leave Delaware for NSW, be sure to use Bankrate’s cost of living calculator to run the numbers to see how far your income will take you to a new place.
ready to sell
Once you’re happy with what’s next, it’s time to get your home ready to impress.
Is it worth upgrading your home before selling?
Major upgrades, like a luxury kitchen remodel, may just be worth your while. Most home improvement projects will only return a fraction of the cost of your sale price. Plus, they take a long time to complete, and who knows what the market will look like in six months? You’d better consider quick, low-cost improvements to make your property more attractive.
What should be repaired before selling?
As a buyer, are there any issues that will bring you down? Keep in mind that most buyers don’t want to spend more after handing over the down payment and closing costs, so you should address obvious issues, such as peeling paint or a leaking bathroom faucet, before listing. However, when you sell your house, you don’t have to fix everything. Ask a professional real estate agent to walk through the house and give candid advice: What areas might raise red flags for buyers?
Should you pay to furnish your home?
One of the quickest ways to make your house stand out is to hire a professional home stage artist. If the room is full of everything you’ve acquired over the years, furnishing your home might make a difference. On the other hand, staging can also make a big difference if you’ve moved out and the home is vacant. A vacant room may not seem so appealing to buyers, who may not be able to imagine how an empty space can come to life. The cost of staging varies by scope of work, but it’s worth investing in: 73% of staging properties sold in 2021 for above list price, according to a survey by the Real Estate Staging Association.
When is the best time to sell a home in Delaware?
Over the past two years, the best time to sell a home in Delaware is June, according to Redfin. That’s when a property spends the fewest days on the market — just nine or 10 — before signings start. That follows a trend in most housing markets across the country: When the weather improves and kids are out of school, buying activity tends to increase.
Find a local Delaware real estate agent
Delaware may be small, but there are nuances in selling homes in the state’s three counties. For example, New Castle County sellers have a big advantage: Delaware realtors have less than 1 month of inventory in August 2022, which helps reduce days on market to just 17. Sussex County is different, with more than 2 days of supply for several months; houses there have been on the market for more than a month. These numbers prove that real estate is a local game, which means you need local experts.
While the real estate agent costs money — usually 3% to your own agent and another 3% to the buyer — the data shows you’ll likely get that money back, and then some. New research from the National Association of Realtors shows that agent-assisted sales end up earning $58,000 more than FSBO (for sale by owner) listings. There is as much time as money. Selling a house takes a lot of work, and if you already have a full-time job, you may not have the time to do it.
Price your home competitively
If you’re trying to figure out how much your house is worth, the answer is how much someone is willing to pay for it. One way to find out is to check with your real estate agent for the nearest compensation in the area. These will give you an idea of what other buyers are willing to pay for similar properties in your area.
You also need to consider current market conditions. Buyers are feeling the impact of higher mortgage payments due to rising interest rates, so despite these concerns, you need to develop a pricing strategy that will attract interest.
Delaware State Documents and Disclosures
Home sellers in Delaware must complete the state’s Property Condition Report, a seven-page form that includes everything you know about the home and any defects. This is an exhaustive report that includes everything from the type of amplifier service in the electrical system to the date of the last roof installation. Also, if your home is part of a homeowners association, be prepared to submit documentation about the organization’s finances and any bylaws the new owners will need to follow.
Need to sell your home fast?
If time is not on your side, consider these two ways to sell your home fast.
- Sold for cash: Rather than deal with the slow process of waiting for individual buyers to secure financing, many companies buy homes in cash. Locals with aptly named names—for example, We Buy in Delaware, Delaware Homebuyers, and 302 Homebuyers (recognition of local area codes)—these real estate investment firms are looking for opportunities to convert properties for rent or Fix them and sell them for profit.
- Listed as is: One of the reasons that closing real estate deals often takes a long time is because of protracted negotiations over repairs and concessions. The as-is list eliminates this back-and-forth, speeding up the closing timeline.
Closing day is exciting, but not cheap. Delaware has some of the highest transaction costs in the country: nearly $18,000 in 2021, according to ClosingCorp. It’s important to note that this figure doesn’t include real estate agent fees – which fall on your shoulders and can be around 6% of your home’s purchase price (unless you manage to negotiate a lower commission rate). There are a few other costs you need to consider before handing over your keys.
The cost of selling a home in Delaware
- Transfer Tax: Delaware has the highest state real estate transfer tax in the nation: 4% of the purchase price, of which 2.5% goes to the state and 1.5% goes to the county. You might split the cost with the buyer, so on a $350,000 sale, the seller’s transfer tax portion adds up to $7,000.
- Title Insurance: The buyer may aim to negotiate the cost of the title insurance policy, but you don’t have to agree. In most cases in Delaware, buyers will choose this part of the label.
- lawyer fee: State law requires you to hire a real estate attorney in Delaware. The fee will depend on their hourly rate and how long it takes your transaction from start to finish.
- concession: If the buyer’s home inspection reveals any problems with the home, they may ask you to pay a portion of the closing cost to cover the cost of repairs. It’s up to you to agree, but if you agree, the money will come from your earnings.
take the first step
Now, it’s time to interview some real estate agents to help you start your journey. Ask questions to help you understand how everyone is coping with this confusing real estate market and what steps they will take to put you on the path to a successful sale.