Selling Real Estate In New South Wales
Counting down the steps to sell NSW property
With the biggest state population and a highly competitive property market, people selling NSW real estate need to pay attention to all the details.
While buying property in New South Wales can be entirely dependent on your own financial position, selling real estate in NSW is a different matter entirely. That's because you're relying on outside factors to work in your favour, from the general property landscape to buyer attitudes to the interest rate environment. However, you can tip the scales in your favour by understanding the selling process to the letter.
So where do you get started with selling real estate in NSW?
Choosing an agent
A good real estate agent is the cornerstone of the process of selling property in NSW. However, it is important to check for many qualities and qualifications before you sign the agency agreement, which is a legally binding document meaning a specific agent will represent you in the sale. This document also outlines the rough sale price, method of sale, commission and how it will be paid, and the authority period - or time the agent has to sell your property.
LJ Hooker has many experienced and importantly licenced real estate agents right across NSW who will be able to help you through the sales process. To make sure you are choosing the right agent when you meet with them, you should check:
- Their license
- Professional indemnity insurance
- Exact fees and the commission they charge
- Any ethical codes or codes of conduct they are required to adhere to, as this gives you assurance of legal protection
- How they would promote and market your home and how much this would cost (you will have to pay marketing costs even if your property doesn't sell)
- Their local market knowledge
- Comparable local sales
- Estimated property value / selling price (make sure you don't choose an agent just because they quoted the highest price - weigh up all their other qualities too)
- Exactly what services they will provide
- Their track record of local sales
Once you have the full picture and are satisfied with the services an agent offers, you can get to work with them. At LJ Hooker, we have numerous offices across NSW, staffed by professional agents who are ready to help you with their specialist local knowledge.
Ways to sell property in NSW
It is important to talk to your agent about the best method of sale for your property. An LJ Hooker agent will recommend the best method based on the type of property you are selling, the location of the property, the market conditions, your time frame and personal preferences. They will also support their recommendation with recent sales data.
The different ways you can sell your property are:
A standard residential property transaction is known as a Private Treaty sale. This is when you as the home owner set the price you would like to sell the property for, and your real estate agent negotiates individually with prospective buyers to achieve a sale as close to this price as possible.
An auction is a public sale conducted by a licenced auctioneer and are governed by strict rules. There is a reserve price, which is essentially the minimum the home will sell for - if bids surpass the reserve, the highest bidder at the close of proceedings has to sign the contract right there and then.
Setting a reserve price at auction
Setting a realistic reserve price is important, so get to know how much similar properties in your area are selling for - talk to your LJ Hooker agent about their estimated sales price, check websites and attend some local auctions of similar properties. You can also get an independent land valuer to put a price on your property.
Selling NSW property by tender is a process wherein buyers submit single offers, usually with a 5 or 10 per cent deposit. You can then look over these with your agent and accept or reject each of them as you see fit.
In New South Wales (and in particular Sydney), auctions are quite popular - especially when it comes to higher-end houses. Auctions tend to make up 35 to 40 per cent of all sales.
Marketing your property in New South Wales
Advertising your property is especially important in New South Wales. With so many people living here and such a crowded market, you and your agent have to work to make the home stand out amongst the crowd. Maximising your exposure to the market is key.
While the internet is a dominant force, publications like the Sydney Morning Herald still have Monday to Friday print readerships of more than 650,000 people. Using state and local newspapers to market your NSW property is an excellent way to reach these people in a dedicated property section - where the committed buyers are.
There are many websites advertising property for sale in New South Wales, such as realestate.com.au and domain.com.au and of course ljhooker.com.au. Make sure you use a professional photographer as it makes a huge difference to the quality of your property advertisements and perhaps consider a video tour of your home.
Contracts of sale in New South Wales
One of the first things you have to do when selling real estate in NSW is draw up a contract of sale - your home cannot be marketed until this document is established.
- Terms and conditions of your sale
- Title documents and the s149 Zoning Certificate
- Compliance certificates for items like pools
- Relevant documents for strata title
- Drainage diagrams
The use of a solicitor or conveyancer for this part of the process is highly recommended.
For more details, Fair Trading New South Wales outlines all of the specifics of this document, and the Law Society outlines strata-specific details here.
The costs of selling property in NSW
As the sale process begins, you need to keep an eye on all of the costs you will incur from agent fees to inspection costs.
- Agent fees which are outlined in your agency agreement.
- Legal fees will be between $1,500 and $3,000 depending on the complexity of your contracts and the solicitor or conveyancer you work with.
- If you conduct a pest or building inspection to give your home a clean bill of health before sale, this will cost between $300 and $400. A professional valuation will cost approximately $300-$500.
- You will also still be responsible for existing strata fees, land tax and council rates that apply until settlement is completed - these will vary depending on your location, but allow for at least $1,000 to cover them.
- If selling at auction, the auctioneer's fee may not be included in the agency agreement and can cost about $1,000.
- Solicitors and conveyancers can cost up to $2,000 - ensure you are getting an accurate quote and not just an estimate of fees.
- Mortgage fees can be several hundred dollars or even $1,000, especially if you are switching to a new home loan when you move. You may also have to pay off the existing balance of your mortgage, the value of which will vary depending on if your home has grown or fallen in value.
- Cosmetic repairs to your home ahead of advertising may only be a few hundred dollars, while a full plumbing renovation can cost $15,000.
- Moving costs can take home sellers by surprise - anywhere between $500 and $3,500.
Ensure you have all costs laid out in writing and leave no stone unturned in making sure you have every fee and invoice covered.
Settlement of a NSW property sale
If your agent gathers significant interest and you start receiving offers in your desired price range, you might be willing to settle and close off the transaction.
Your agent passes on all offers made for your home as quickly as possible and you can accept or reject these. Your agent can also negotiate on your behalf until a price is reached that you are both happy with. Once you accept an offer, the buyer usually has five days in which they can back out of the transaction. A 10 per cent deposit is paid to you upon exchange of contracts.
Auctions are a strictly regulated process with the reserve price nominated by you or your agent. The auctioneer registers bidders and takes their offers until the close of the process. You can make a vendor bid for your own home, which must be outlined in the Bidders Record (visible to all parties). You can use this to stimulate more bidding, but it must be clearly identified as your own bid.
Once the highest bidder is determined and reserve is reached, the buyer cannot back out of the process and will pay a 10 per cent deposit right there and then. Also note interested buyers can make an offer in writing before auction which your agent will present to you. You can decide to accept the offer or reject the offer and take it to auction. Your LJ Hooker agent will be helpful in advising you as the best path to take here.
Exchange of Contracts and Settlement
The sale itself is actually very simple - all you do is sign the agreed upon contract with the associated settlement dates and conditions. It is recommended at this point that your conveyancer or solicitor manages all the legal elements.
Settlement is the legal completion of the process and is when the remaining payment from the buyer is paid to you. This normally takes place six weeks after the contracts are exchanged. For any further questions about selling property in NSW, get in touch with your local LJ Hooker representative.