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Mr. Feichthaler:
My husband and I have lived in the same house for 25 years, and we love it here. Our main asset is our home, which we bought for $160,000 in 1997. We have not considered selling our house, but we received a phone call that we couldn't ignore. He said he was a Realtor, and that he could list our house for $500,000! I feel like we won the lottery. We may actually move back up north, as our son has an extra room in the house and we can see our grandchildren more. Before we agree, do you see any issues with listing our house with the man on the phone?
-- Adrian J.
Dear Adrian:
As prices continue to rise, this is a question I am asked all the time - is this THE time to sell? Based on social and economic challenges, I would have expected prices to level off in the middle of last year. Instead, prices have increased dramatically, especially since Novem-ber. Many homeowners are now getting bombarded with calls, emails and letters begging to sell or list your house. I have noted before that, al-though I do not fault someone for trying to get a great deal, it is up to the seller to know what they have. Your house could be worth well over $500,000 based on recent sales.
When hiring a Realtor, you will want to do your homework. How long have they been in practice? Who is their broker, and how long have they been in business? Do they have any complaints filed against them, or lawsuits? Basically, what is their reputation?
Assuming they have a good reputation, one of the benefits of hiring a Realtor is the ability to obtain comparable recent sales from them. Once you know what other similar houses are selling for, and you have engaged a quality Realtor, you can intelligently set a price that will bring you the highest sales price.
Keep in mind, there are transaction costs associated with sales, most notably real estate commissions if you do hire a Realtor. Typical total costs are around 8% of the sales price, but this can vary. Once you determine the listing price, and that you are satisfied with the after-cost proceeds, you should go forward with the plan (after speaking with your husband and son's family, of course).
Each taxpayer is entitled to a $250,000 exemption on profit for selling a primary residence. So, even if the property sold for $600,000, you should have no income tax liability for the sale, since you have lived there over 2 years as your primary residence.
I note this in many of my responses: the sale of a home is the largest financial transaction most of us will ever enter. Before signing anything, seek professional advice before proceeding.
Eric P. Feichthaler has lived in Cape Coral for over 35 years and graduated from Mariner High School in Cape Coral. After completing law school at Georgetown University in Washington, D.C., he returned to Southwest Florida to practice law and raise a family. He served as mayor of Cape Coral from 2005-2008, and continues his service to the community through the Cape Coral Caring Center, Cape Coral Museum of History, and Cape Coral Kiwanis. He has been married to his wife, Mary, for over 20 years, and they have four children together. He earned his board certification in Real Estate Law from the Florida Bar. He is AV Preeminent rated by Martindale-Hubbell for professional ethics and legal ability, and is a Supreme Court Certified Circuit Civil Mediator. He can be reached at eric@capecoralattorney .com, or 239-542-4733.
This article is general in nature and not intended as legal advice to anyone. Individuals should seek legal counsel before acting on any matter of legal rights and obligations.