Selling a house can be a challenging and emotional endeavour no matter what your reason is for moving. In many ways, it can be even more difficult to go through the process when the home isn’t your own.

As an adult, helping to list the home of your parents or other loved one means you need to understand a fast-changing market while handling the conversations and ultimately the transaction with care and compassion. How do you start? In this post, we’ll explore both the similarities and differences of between helping a parent or family member sell their home versus selling your own home. 

What Stays the Same? 

A great starting point, is a solid understanding of what is happening in the real estate market today. You want to be up to date with current trends, such as how fast houses are selling in the neighbourhood and for how much. 

Whether selling your own home or supporting or selling someone else’s, an experienced and knowledgeable real estate agent can ease much of the stress from the process. In all markets, you’ll want someone who can bring maximum exposure to your listing and knows how to negotiate challenging situations in what can be a dynamic market. 

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Have your parents or someone you are assisting also asked for help downsizing after their existing home sells? The resources below will be helpful:

• What All Downsizers Need to Know About Buying and Selling in Ottawa
• Is It Better to Rent as a Senior in Ottawa?
• Smartsizing Vs. Downsizing: What’s the Difference?

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The Key Differences 

Though selling someone else’s home is similar in a broad sense, there are also several key differences that you will want to be aware of. Your parents or loved one who has asked for your help has done so for a reason. They need to make a change in their lives, and while speed is almost always of the essence, there is always a need to make time to explain the process and the impact of the sale.

When selling any home, you might take your time cleaning, decluttering, and renovating to get it ready to wow potential buyers. If a fast sale is required, you must expedite this process. However, you may also need to reconsider some of your priorities.  

• Some upgrades will be absolutely critical, especially during slower markets where houses take longer to sell. 
• On the other hand, you’ll want to avoid time-consuming renovations that don’t add enough value to make them worthwhile.  

You always want to prepare the home to earn the highest possible amount!

Finding a Real Estate Agent

Since the real estate market, can be challenging to navigate, your real estate agent is your best source of guidance when it comes to what to do and what not to do to prepare for the sale. Their marketing and negotiation expertise becomes even more critical when selling a house in its present condition and when dealing with a sale where you are assisting someone else or have been legally empowered to handle the sale. 

If the home is vacant, keeping a vigilant eye on the property becomes necessary for a variety of reasons. You want to attract interest from potential buyers without drawing attention to the fact that no one is currently living in the property.

Further, a potential buyer knowing the property is vacant may believe that you are highly motivated to sell and may negotiate harder for a lower price. All the more reason to have a trusted Realtor® on your side!

If you need more help finding a real estate agent you can trust, check out What are the Signs You’ve Found a Great Realtor®?

Legal Considerations for Selling a Home You Don’t Own 

Needless to say, you cannot actually list your parents’ home or that of a close family member without their consent. They may have asked you to take the reins, but you’ll still need to visit a lawyer to obtain the required permissions to conduct the transaction on their behalf.   

• To sell a home for someone living, they need to designate you as a Power of Attorney while they are still capable.  
• If your parents have passed away, you need to be the executor of the will.  

Neither of these is a discussion anyone looks forward to. However, making arrangements in advance will make the process of selling easier for everyone when the time comes. We recommend speaking to an experienced lawyer to ensure you are clear on your parents’ wants and needs. 

Depending on the extent of your responsibilities, you may not always need Power of Attorney designation. For example, imagine your parents or loved one asks for assistance or guidance in selling their home. You can help them with tasks such as selecting a Realtor® and communicating with contractors and movers. However, if they are the ones making the big decisions, and it’s their signature is on the agreements, then you likely won’t need legal authority to proceed.

Will Capital Gains Be an Issue? 

Capital gains are another subject many people prefer to avoid. However, it’s always better to know what you are up against than to sit back and wait for surprises. The first thing to know is that there are no capital gains when selling a home that is your parents’ primary residence.  

Second homes or income properties will be taxed on 50% of the increase in value from the day of purchase. For example, imagine your parents bought a condo five years ago for $500,000. If the fair market value is now $550,000, they have a $50,000 gain. Of this, 50% (or $25,000) is taxable.  

What if your parents have passed away, and the home is now your inheritance? The good news is that Canada does not have an inheritance tax. If the property is worth $500,000 and you sell it before the value goes up, you will not be subjected to capital gains. If you sell it a few years later, you will be taxed on the increase in value.  

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Are you looking for practical advice for selling a home in today’s market? The related reading below will give you some ideas:

• You Only Have One Chance to Make a First Impression
• How to Sell Your Ottawa Home When You Have Kids or Pets
• When Is the Best Time to Sell My Ottawa Home?

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Treating the Transaction With Respect 

Selling a home on behalf of someone else is a big responsibility. If you are a Power of Attorney or Executor, you are legally obligated to follow your parents’ or loved one’s wishes. However, you always want to be mindful of their needs and wishes even when not beholden to the law. Think of it this way: 

• If your parents have passed away, conduct the transaction in a way that honours their memory. 
• If they are still living and need your assistance, respect their wishes. 

By keeping the lines of communication open and acting with empathy, you can help turn what would have been an emotional and stressful transition into a positive experience.  

Do you have questions about how to sell a home on behalf of someone else in a way that honours their legacy? Our knowledgeable and compassionate experts are happy to help. Reach out today to mail@chellteam.com or call 613.829.7484 to begin the conversation.