Categories
Blog

Selling A Home In A Retirement Community: What You Need To Know

There are a few key steps to home selling. Selling in a retirement community has a few extra steps. Let’s dive into selling in a retirement community and what you need to know to make the process as smooth as possible.

When you moved into your “55+ community,” you might have intended to stay for the long haul. But plans change — and if you’re now looking to sell your property in a retirement community, you probably want to save money on the deal.

Real estate agents typically take 5% – 6% of the sale price, which could mean as much as $15,000 in commissions on the sale of a $250,000 house. Listing your home as “for sale by owner” could help you cut down on costs because you won’t have to pay the buyer’s agent. But there are some extra steps you’ll need to take when selling in an active-adult community. Here’s what you need to know.

Research Your Community’s Guidelines On Selling

Most communities that cater to older homeowners are deed restricted, which means there are clauses that limit how you can use your property. Check with your homeowners association for details. Your community might have rules surrounding who can buy your property, such as:

> Home buyers must meet age restrictions, and children might not be allowed as permanent residents.

> Buyers might also have to answer questions about their health and finances.

> Some communities don’t allow “For Sale” signs in the yard.

> Open houses could be allowed, but usually without signage.

> Prospective buyers might need to park in designated areas when touring the property.

> Pets may or may not be allowed.

Age is usually the most important restriction. That’s because at least 80% of owned units in a 55+ community must be occupied by at least one homeowner who’s 55 or older, according to the U.S. Department of Housing and Urban Development.

Determine What Similar Homes Are Selling For

Coming up with a listing price is something of an art form: You want to make enough from the sale to pay off your mortgage balance and pocket the profits, but you also want to set the price low enough to attract enough buyers or set up your listing for a bidding war.

Generally, you’ll attract more buyers to an age-restricted community if you live in an area with a large population of seniors. In 2018, more than half the 65+ population was concentrated among California, Florida, Texas, New York, Pennsylvania, Ohio, Illinois, Michigan and North Carolina.

But you don’t have to live in one of these states to net a good selling price. Start by researching recent sales of comparable homes in your community. The homes should have the same number of bedrooms and bathrooms and a similar square footage.

Calculate the average cost per square foot. For example, if a home measures 1,500 square feet and sold for $250,000, then it cost $167 per square foot. You can also use free online resources to determine your home’s value or scour local tax records for recent sales data. Use all of this information to guide your listing price.

You also stand to get top dollar if you list your home when more people are hunting for properties. In most areas of the U.S., the best time to sell is during the first two weeks of May. Listings go for about 6% more at this time of year, and homes sell 18.5 days faster than any other month.

Prepare And List Your Home

Once you set a price for your home, it’s time to prepare your home for potential buyers and put it on the market. To make your home more attractive to buyers, take some time to:

> Clean and declutter the interior and exterior.

> Replace light bulbs and add lamps to improve lighting.

> Make small cosmetic repairs.

> Paint the interior walls with warm, neutral colors.

> Hire a professional to take photos of the home.

Next, write a property summary and create a property flyer. It should highlight the features of your retirement community and help buyers imagine what it would be like to live there. You can hand these out to your open house guests or use them while marketing (more on that below). The flyer should include these details:

> Property address

> Asking price

> Monthly fee for the retirement community

> Large, colorful photos

> A brief description of the home

> The cost of annual or monthly property taxes

> Your name, phone number and email address

> Recent upgrades and special features

> Square footage and number of beds/baths

> Neighborhood amenities

Market Your Home

When marketing your home to prospective buyers, you’ll need to go where your buyers are — while following your community’s rules. Here are some ideas:

> Post signs in the yard: If your community allows it, stick a “For Sale” sign in your front yard with your contact information. Consider purchasing a phone number solely for this purpose and creating a unique email address to handle incoming messages from buyers.

> Post on community bulletin boards: Where do the seniors in your area usually gather? For example, bulletin boards at gyms, golf courses and churches could draw attention to your buyer demographic, or you can advertise in your local newspaper.

> Use snail mail for flyers: Mail out your property flyer to your friends and neighbors, who might know of someone looking to buy property in your community.

> Respond by phone: When you start hearing back from potential buyers, follow up via phone call to answer questions and provide more information. This is a personal touch that seniors might appreciate.

> Create A Website: Seniors might prefer to check out videos of available properties before scheduling an appointment to view them. Attract them by creating a website for your listing and including photos of your home and a video for virtual walkthroughs. The website should include all the information from your property flyer.

> Don’t forget your other online options: While some seniors avoid the internet, others are active on social media. Create a Facebook page for your listing and invite others to share it via their social media channels.

You might need to schedule private listings or host a few open houses before you receive offers. From there, you can negotiate the selling price, sign a purchase and sale agreement, and speed toward closing day.