Whilst the excitement of making a big profit on the sale of your home is easy to understand, but as with anything else, it takes money to make money. Unfortunately, the figures people use often don’t take everything into account. The cost of owning a home whilst in the process of selling adds up a lot more than people would think. Whilst people in the property industry may be familiar with it, homeowners who are ready to sell may have overlooked the weight that holding costs carry.
Holding costs are pretty much unavoidable in the game of traditional home sales, but adding to that the costs to prepare, make any repairs, and market your home or commissions if you’re working with an estate agent, you’ll see that things soon add up. If you are forced to relocate before the sale due to your circumstances, you’ve effectively doubled your holding costs.
Regardless of whether you list your home with an estate agent or sell independently, you’re financially responsible for the expenses of holding the property until it has sold completely. And although some of these expenses are rather obvious, it can be eye-opening to look at them listed out on paper and see just how much they deplete your profits month on month. It’s therefore massively important to understand how to calculate these accurately.
Mortgage
The holding costs for your home include the mortgage payment, likely the largest of your expenses, and what will probably be the most significant concern as time goes on. Whilst it’s almost impossible to say how many months’ worth of fees you’ll have to carry once you’ve made the decision to sell. Speaking to local agents and having a look at recent sales in your area you can use the average number of days on the market (DOM) to make an educated guess. Although pricing your home correctly from the very beginning is one of the best ways to achieve a fast sale, taking all of the steps to present your home in its best light across all of your marketing efforts can lower the DOM even further.
Utilities
If you’ve moved out before the sale, you may be tempted to turn off the utilities to save money on your holding costs. However, you should at least consider leaving everything in place for the convenience it will offer the estate agent. This way any problems with the home should be brought to light and because of disclosure laws, it’s in your best interest to detect these before the sale goes through. Furthermore, even with all utilities disconnected they’ll continue to charge you in standing charges. So every day that goes by, they charge you a flat rate just for being connected, over time these can really mount up. Also, not having the utilities on can lead to maintenance issues, especially during the winter months with no heat in the property. So it’s always a good idea to keep these running, but do mind the costs.
Taxes and Insurance
While not always at the forefront of your mind when considering the holding costs involved with the sale of your house in the North East, buildings insurance, like the mortgage, will be a given when you own property. You’re responsible for the insurance on the home until it is no longer in your name, in addition, you’ll bear the burden of any repairs if any damage occurs, and your insurance does often not cover vacant properties (certainly check this with your insurer before moving out, you may be charged a higher rate of insurance).
Maintenance and Repairs
While you may not necessarily consider repairs as holding costs associated with your house in North East, surprises of the disastrous type are common when you own a home. These unexpected expenses can add fear of the unknown to the listing process and financial urgency to your need to sell. You’ll also need to ensure that the home’s exterior retains the curbside appeal from the first day it is listed until sold. You’ll also need to make sure the interior remains viewing-ready at all times. Finally, if you’ve had to relocate, you may have the added expense of hiring the work done or traveling from home to home and caring for both.
We Can Make Things Simple
North East House Buyers can save you time and money! Because North East House Buyers pays cash, completion comes in a matter of days, so you can clear the slate on holding costs and start making other plans for your future. A direct sale to North East House Buyers means you don’t need to make repairs or spend your money on marketing. The fair offer you receive is the amount of cash you’ll have in hand; no hidden fees or commissions will come off the top at completion. Ready to learn more? Contact North East House Buyers at 0191 462 0160 today!