50 tips for buying and selling your home
Buying or selling a house is the biggest deal you can do in the course of your lifetime. It brings all sorts of challenges from finding your dream house to getting your finances ship-shape and negotiating the best price for you and your family.
Published 11/09/2016 | 02:30
No wonder it is also one of the most stressful experiences you can go through - in the battle to get everything from a BER cert to your packing done, it's easy to overlook a detail. And we all know that the devil is in the detail. With that in mind, Fran Power asked 10 experts across the property market to share their insiders' tips on how to buy and sell a property in today's market.
For the sellers
1 Inform your pricing strategy by understanding how buyers' purchasing power is determined. Think of a couple - give them names, occupation, everything - that you think would buy your home. What do they work at and how much do they earn? This will lead to the obvious next question: what is 3.5 times their gross annual salary? This, plus whatever their likely deposit is, is their budget.
2 Organise all your paperwork. If your property has a separate septic tank, make sure it is registered and check whether the septic tank and percolation area are inside your site boundary. Make sure any rights of ways are correctly shown on your property. Ensure all planning permissions and building certificates are to hand for alterations and extensions. Explore carefully whether the property has any development potential. Carry out a Building Energy Rating Assessment - these need to be updated every 10 years and cost approximately €150.
3 If you're selling a second house, make sure your NPPR (tax for second homes that preceded property tax) is paid up to date and that your property tax is up to date. Ensure all household charges and water charges have been discharged.
4 Pick a good agent - they will be your best (or worst) asset in the course of the sale. Don't necessarily choose the cheapest or the most expensive. Take time to turn up to open viewings of properties they have on the market and make sure they are there in person or at least that there is a competent senior agent who can answer questions there in their stead. It is crucial that the agent showing your house knows all its special features and can answer questions. Check too that they are licensed and agree a sales fee. Expect to pay between 1-1.75pc of the price your property eventually sells for. Some agents have a scale fee, charging 1pc up to a certain price and an increased percentage beyond that.
5 Most estate agents charge an upfront marketing fee on top of their fee - this will cover, for example, professional photography. The flipside is that those who don't charge a marketing fee may absorb the cost of photography themselves and the quality may not be as high. Make sure outside photos are taken with no part of your house in the shade. Ask for a walk-through video, if possible. Make sure the auctioneer's brochure contains room measurements and floor plans as they help interested parties to visualise the layout.
6 Don't follow the herd; people traditionally sell in autumn and spring but demand is constant and less seasonal than it once was. It may work to your advantage to sell off-peak when there are fewer new properties and less competition on the market.
7 Don't always believe the estate agent's valuation of your property. Some may price high to get your instruction and up their market share, rather than working to get your house sold in a swift, active campaign for the best possible price.
8 Keep an eye on places similar to yours that are for sale in the area; google them or view them, get a brochure, then use the information to guide your pricing strategy. Examine the Property Price Register for price comparisons and remember, location and condition are the drivers of strong pricing.
9 If you're not happy with the progress of a sale, change your estate agents. Sometimes a new agent can breathe new life into a sale. To this end make sure when signing your property services agreement with your agent that you can break the agreement with reasonable notice after an initial period of, say, 8-12 weeks, without penalties. Be aware that if you have paid for professional photography, you can reuse it with another agent, so it's a cost saved.
10 Instruct your solicitor and agree their fee - these vary hugely in amount and in structure. Ask for recommendations from people you trust.
11 Many sales fall through due to delays with contracts. You can't do anything about the purchaser's solicitor but you can ensure the delays will not be from your end. If you have a mortgage, make sure your solicitor looks for your property deeds from your mortgage company as this can be a source of long delay. If you don't have a mortgage, make sure the solicitor examines your property deeds to see if they are in order.
12 Normally, your house should sell in around three months. If it is lingering, sit down with your agent and discuss the possible reasons - it may not be anything wrong with the agent's campaign. In the current market, the price may be too high or the market may have slipped for your property.
13 You have eight seconds to make that all-important good first impression. Make sure you have 'curb appeal' by sprucing up your front garden and entrance. Trim the grass, fix peeling paint and make your windows sparkle. Clean the gutters so there's no greenery growing out of them.
14 Clean, clean, clean. Make the house clutter fre, fresh and ready for a new owner to move in. This attracts those who do not have the time, inclination or patience to do work. If this means painting, it has to be done. Pick light neutral colours, use loads of white paint and replace old tired carpets. Wash the windows, let as much light in as possible, when viewing make sure all curtains are open. Viewers love bright properties.
15 Consider renting a storage unit - with luck it will only be needed for a few months - and do a big de-clutter. You want to strike a happy balance between your house looking like a home and it looking like a show house. Sometimes people are buying the house for your taste.
16 Do the repairs you have always meant to - it will be worth several multiples of the cost on the price. BUT if you are painting an old house, be careful, particularly if the walls are damp. While this may look good to the intending/viewing purchaser, a competent surveyor will pick up the dampness and your re-decorations will have been wasted as once the necessary repairs have been addressed, it will need repainting.
17If you're spending money just to pimp your property, ie, putting in new bathrooms or a kitchen in an old property that needs a total refurb, be aware that you may not get it back. A surveyor will spot what needs to be redone and a potential vendor will take this into account in bidding for the property. In short, you've wasted your money.
18 Try to look at your house with fresh eyes. Make sure each room has a use and a purpose - make a wasted space into a study, put a cot in to a tiny box room, a dining table in that second downstairs room you never use. Get rid of bulky furniture and make sure that the circulation and flow through the house is seamless.
19 Decide on one fragrance for the house in terms of candles and diffusers, and stick to it. Don't have a curry or fried fish the night before a viewing.
20 Indoor plants are cheaper than flowers. M&S is good value for flowers; alstroemeria gives you a lot of bloom for your buck.
21 If you think a table or other piece of furniture will improve your dining room, so will a potential buyer - you can rent one from professional house stagers (try Design Source; design-source.ie) if you don't want to buy one.
22 Avoid showing a house without furniture, you're selling a potential home.
23Putting your house on the market just before you go on holiday is the ideal time - it will stay tidy and be available for viewers at all times.
24 Do your best to ensure that there is parking outside your house for anyone coming to view. That means moving your own car around the corner. Take the time to pick up litter and dog poo off the street before viewings.
25 Decide if you need a quick sale or can hold out for a better price.
For the buyers
1 Set a maximum bid for yourself at the start of the process and don't budge, no matter how much you have fallen in love with a property. To do that, calculate what the rent would be if you rented rather than owned the house, and express that in per-year terms. A rough rule of thumb is that the price shouldn't be more than 20-25 times the annual rent so, for example, a monthly rent of €1,600 converts into an annual rental bill of close to €20,000, making your maximum bid between €400,000 and €500,000. In 2007, there were homes trading for over 50 times the annual rent - this was over-paying, relative to the 'rental service' the home offers, and it has hurt people.
2 Make a realistic estimate of your current property's resale value - if you're trading up, get your current home valued accurately, the more you secure for it, the more you have to spend for your next purchase. Use the Property Price Register or get in a local estate agent. Many people make the mistake of over-valuing their garden, extension, kitchen, etc. You may not be allowed to borrow more if you get it wrong.
3 Calculate all the costs involved in your proposed purchase - most people become consumed with the monthly mortgage repayments and the associated expenses involved in closing the sale. But remember to include the running costs of your purchase, including lighting, heating, service charges, property taxes or general maintenance. A recommended annual figure for this is approximately 1.5pc of the value of the property.
4 Check out the parking - where a property is in a built-up area, what are the facilities for parking? Is it on-street, permit parking and if so, how much does that cost. If you're buying an apartment, is the parking communal or allocated and is there an extra fee for usage.
5 If the building is in an area with planning restrictions, or it is a listed or protected structure, can you make the renovations you want? Check this with an architect or quantity surveyor before you buy.
6 Check the quality of any home improvements. If a property has had work carried out - a loft conversion or extension, for example - check that all permits, building regulations and planning permissions have been observed. Ensure that the survey carried out examines the standard of workmanship so you can assess any future repairs needed.
7 Look at the history of the management company. In Ireland, management companies generally arise in apartment complexes or townhouse schemes. Check whether it is fully functioning, how did it fare in the crash, what maintenance and services does it cover, what are the service charges, are the communal areas well-kept? Developments with large communal areas are most vulnerable. Most private developments of semi-detached or detached homes establish their own internal resident's association.
8 Explore the 'hood. Look out for anti-social behaviour, how green spaces are used, graffiti, traffic patterns and proximity to schools and shops. If you have children, are there pedestrian crossings where needed? If you are looking for a community to tap into, a cul de sac or square generally has more interaction between neighbours than a busy thoroughfare. How many houses in the area are owner-occupied? A high number can usually be taken as an indication that people are happy to live in the area. Visit at different times of the day, especially at rush hour to assess the traffic, and late at night, weekends for noisy neighbours and to assess what sort of locals are living there.
9 Check with your local authority on the plans for the area you are proposing to buy in. Is there a road being planned, a large development? Some of these may improve your property's eventual value and some may decrease it. Be informed.
10 Always have a survey carried out by a qualified architect/engineer or surveyor. Never rely on a survey carried out by the lender.
11 Make sure your loan offer does not lapse prior to the completion of your purchase.
12 When it comes to calculating your deposit. You will need a minimum of 10pc of the purchase price (to €220,000) as a first-time buyer (FTB), and 20pc of anything over this, or, if you're buying second time around, 20pc on the whole lot, either in cash, or equity in your existing house. Banks want to see a clear, unambiguous and preferably lengthy savings record toward a deposit. While it's possible to use gifts from parents, etc, towards the deposit, it is inadvisable to top it up with a separate loan, eg, from the credit union.
13 Decide on whether you want a fixed or variable rate mortgage. Fixed interest rates are excellent value and banks are pushing them. Consider all rates over the entire term and don't get swayed by short-term gimmicks like cash back or cheap insurance unless the overall interest rate is competitive.
14 Get rid of existing debt, if you can. Banks want to see that you have enough disposable income to repay the mortgage if interest rates rise. They will 'stress test' by 2pc more than the current rate. A personal loan, or maxed-out credit card will be counter-productive. You may have to make the tough decision to use some of your deposit toward paying these off, or at least, show you can afford both.
15 Clean up your credit rating. It is assessed over two years (at least). Any missed payments or defaults on previous loans, credit cards or any court judgments will stand against you. Find out your rating in advance with icb.ie (costs €6).
16 If your credit rating is 'impaired', five of the six banks issuing mortgages won't approve your's. New arrival Pepper may do, however, you will need to have a clean credit report on secured loans for the last four years and two years of clean credit on any unsecured loans.
17 Tidy up your current account. Your records will be scrutinised for a minimum of six months. Banks will be on the look out for morally dubious spending, such as a gambling habit (get rid of that bookie's app!), or a high expenditure in your local, for example.
18 Consider mortgage coaching - for a fee of roughly €250, a broker will look at your finances and put a plan in place to correct bad habits in your current account or patterns of spending with your credit card to make sure you succeed with your application.
19 If you're self-employed and looking for a mortgage, the lender will take the average income figure over the last three years, not the last year which might be your best.
20 If you're in negative equity you can still get a mortgage but it'll be hard. While most banks have a negative equity mortgage product, they are very restrictive and nearly impossible to get unless your salary(ies) exceed €80,000 pa. There were only 300 negative equity mortgages in 2014 and while figures are difficult to come by for 2015, it seems likely there were fewer. You must have a 10pc deposit for the house you are buying as part of the application process. Typically, 175pc loan-to-value is the maximum amount you can borrow where you carry forward debt from your original mortgage. These types of mortgages are exempt from the Central Bank's rules on loan-to-income and loan-to-value.
21 If you're a first-time buyer, the next budget may bring good news. The Government has indicated that there will be an incentive for FTBs with a figure of €10,000 per property purchase being mentioned, back dated to July of this year.
22 Get your life cover in order. Mortgage protection is compulsory and medical evidence can take time to underwrite. Have the plan in place or you won't be allowed to draw down funds. This is one of the most unnecessary causes of delay in getting a mortgage.
23 If you're buying new, get accurate estimates of completion from the developer. There's no point drawing down funds before you need them, and there should be a staged deposit process. You only pay interest on what you have already borrowed.
24 On a chain gang? If you're caught in a seller-buyer-seller triangle, the purchase may take longer than expected. A good solicitor and estate agent will smooth the passage and ensure that your move in/out time is clearly agreed.
25 Have patience. Getting a mortgage may take three to six months. It is the most important and biggest purchase of your life, so don't underestimate the stress or expense. Consider using a specialist mortgage broker for the heavy lifting. It will cost around €500.
Joe Ritchie is a solicitor with Donal M Gahan, Ritchie & Co; Sinead Ryan is a personal finance expert, columnist and journalist; our columnist Ronan Lyons is also assistant professor of economics at Trinity College Dublin and author of the daft.ie reports; Michael Dowling is director of Dowling Financial and chairman of the Irish Brokers Association Mortgage Committee; Pat Davitt is chief executive of the Institute of Professional Auctioneers and Valuers; Philip Farrell is a property consultant and market commentator; Rebecca Rowe stages houses for sale, email@example.com; Katy McGuinness writes on property for Sunday Property; Jamie Douglas is a branch manager with Hunters estate agents; Val O'Brien is a chartered building surveyor, and a technical director with McGovern O'Brien Chartered Building Surveyors.