Estate Sale Basics
An estate sale involves the sale of most or all the belongings of an estate or a family, and most often happens when the head of the estate passes away. Something must be done with all the belongings and/or property, and selling it is usually the most practical way to dispose of it. An estate sale may also involve the sale of a home or other property.
People often use the term “estate sale” in different ways. For example, if you are not a real estate agent you’re probably bound to be thinking that it is more like an auction where furniture and other possessions are liquidated. From a real estate agents perspective, an estate sale can mean selling a property for one of the heirs. Both of these can be considered proper usage of the term. In some parts of the country they are referred to as “tag sales” as well.
Estate sales are typically conducted by an auctioneer when it comes to liquidating possessions and a real estate agent when it comes to the actual house. Auctioneers take a percentage of the total earnings of the estate sale as payment, typically between 25 and 35 percent. An auctioneer will put a lot of effort into making the estate sale go smoothly.
Assessing the value of property, organizing items for display and making sure everything is well coordinated as part of an auctioneer’s job description. They are usually also responsible for cleaning out what’s left in the the home at the end of the sale and leaving everything clean.
If you own specialized, rare or expensive property for your sale, an estate sale expert can be incredibly important for determining the right asking price. Exceptional estate sale agents have resources, who are experts in selling unique items, fine art, collectibles, jewelry and other valuables. Estate sales can be quite common when someone is selling a luxury home.
Auctioneers will be working hard for you to net the most money because the better you do the more money they make. They will also be responsible for publicizing the sale including advertising in newspapers and online, as well as putting up signs in the neighborhood.
If you find yourself in the position of needing to conduct an estate sale, it is important to plan your work carefully and do your research. There might be considerable value in both the possessions and the property you are selling, and you want to sell these things for a fair price. Failing to do things right may mean missing out on a considerable amount of money, depending on the circumstances.
Tips For Your Estate Sale
1. Get help from professionals
Unless you are certain that what you are selling has little value – and that means really, really certain – then you will benefit from working with a professional. Estate sale companies exist that can guide you through the entire process, ensuring that what you are selling is priced correctly and that you follow all the rules and regulations in your area. Here are a few tips for choosing an estate sale company.
If you are selling a home as well, make sure you hire a reputable real estate agent. Knowing how to pick a real estate agent is vital to the success of your sale. You are likely to get more money for the home if you work with a skilled agent, and you will certainly be saved a considerable amount of work by letting the Realtor do all the heavy lifting.
Paul Sian also offers some great tips on how to sell an inherited home.
2. Choose your help carefully
While working with professionals is the wisest choice, remember that not all estate sale companies or Realtors are equal. Some will be great at their jobs, reliable and efficient, while others will barely hold things together – and possibly get you in trouble, or take advantage of you. If your loved one just died, you are likely to be under a lot of stress. The last thing you need is the people you hired making it worse.
- Conduct interviews – interview anyone you are going to hire thoroughly.
- Get recommendations – ask around to see if there is an estate sale company or real estate agent that is well-liked and trusted by co-workers, friends or family.
- Talk to recent clients – any competent professional should have several recent clients that you can talk to and get an idea of how they liked their work.
- Choose someone you will like working with – again, you are under stress and going through a complex process, so pick someone that is not only capable but that you can get along with.
3. Get a clear picture of what it is going to cost
Any estate sale company or real estate agent that is worth hiring will have a clear pricing structure, often a percentage of the final sale price. Talk about the pricing and how it is calculated. Keep in mind that cheaper is not always better. A higher price might mean a better overall experience, and possibly a higher sale price in the end. Of course, the reverse could be true as well – a higher price might not be worth it. That is why you should consider not only price, but reputation and everything included in the price before decide.
4. Get a record of the estate sale company or the Realtor’s past sales to verify their pricing abilities
Companies and business people that help others sell products should keep records of their work. One of the key qualities you want in a business like these is the ability to price things correctly from the start because it leads to quicker sales and avoids the back and forth of dropping prices over and over to finally unload an item. Whether it’s a china cabinet, a car or a home, you want someone that knows how to price items to sell. If they are good at it, they will want to show it off and let you know about it.
Here is how to go about pricing your items in an estate sale. Use this as a guide to get your pricing right.
5. Get a contract
Contracts keep people and businesses honest – most of the time. But for the contract to be effective, it has to be well-drafted and it has to cover all the aspects of your relationship that are important. Only work with companies and individuals who are willing to sign a contract. If there is a great deal of money involved, it is also in your interest to have the contract reviewed by an attorney.
6. Avoid throwing anything away before you meet with a few estate planning companies
If you have ever watched any television shows where professionals identify and price antiques, you know that the true value of an item may not be apparent to the casual observer. While you may have no interest in your grandmother’s napkins or her collectibles, it does not mean that other people won’t be. Maybe your dad was an avid collector of baseball cards, stamps or coins? It is conceivable that these items are worth far more money than you think they are!
Do not throw anything away before you have at least one or two estate planning companies come by the estate. Let the professionals look over all the items in the estate before making any rash decisions.
Ideally, you should avoid throwing anything away until every item has been cataloged and priced. Only then will you know what you have and what you don’t.
7. Visit a few estate sales
Research is important before any big endeavor, and conducting an estate sale is not different. If you have never been to one, it is in your best interest to visit one or more and get an idea of what is involved. You can see what you like and what you don’t. If you are really impressed, you can ask those running the sale about the estate sale company in charge and hire them for your own sale.
Like anything else in life your experience will be better when you are somewhat educated on the process. Getting your feet wet by seeing how estate sales work is just plain smart. A good analogy for this is the person who has just started to think about buying a home. They may decide not to call a real estate agent because they are not really that serious about looking at homes yet. Instead, however, they may start visiting open houses.
This is why many real estate agents will explain to their seller clients that open houses are more for real estate agent prospecting than they are for selling a house.
8. Get clear on taxes
While small sales like garage sales can fly under the radar of the tax man, estate sales are different. Particularly if you are selling a lot of items, or items of considerable value, you will definitely want to pay attention to the tax laws surrounding your estate sale. Here is a good reference that will answer quite a few of your questions when it comes to the tax ramifications of an estate sale.
9. If you need a Realtor, make sure you hire a good one
If the estate sale involves selling a home, you will want to have a real estate agent that is familiar with estate sales and one that has experience with the area and the type of home you are selling. Chances are the home sale will generate more money than anything else in the estate, so it makes sense to hire a professional that can get the best price for the home.
A good Realtor should be happy to answer any questions you have about selling the property, what his or her commission is, and about his or her past history with similar home sales. Selling homes is particularly tricky when it comes to pricing. Price it too high, and you risk it sitting on the market too long and developing as stigma – one that is only overcome by dropping the price substantially, losing money in the process. A good agent can price the home to sell from the beginning, ensuring that you sell quickly and for maximum profit.
Other Helpful Home Selling Resources
- Tips For Staging A Home On A Budget
- Spring Home Maintenance Tips via Nathan Garrett
- Tips For Selling A Vacant Home
About the author: Bill Gassett is a nationally recognized Real Estate leader who has been helping people buy and sell Metrowest Massachusetts real estate for the past thirty plus years. He has been one of the top RE/MAX Realtors in New England for the past decade. In 2016 he was the #1 RE/MAX real estate agent in New England. Connect with him on Google+.
About Rochester’s Real Estate Blog: Rochester’s Real Estate Blog is owned and operated by Kyle Hiscock of the Hiscock Sold Team at RE/MAX Realty Group. With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise.
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