Selling the Cottage

23 March 2011 About The Finances

Is it time to sell the family cottage?
Selling your cabin can be an emotional event. Following these important steps will help make the process to sell the cottage a successful one.

Organize Your Documents

When you plan to sell the cottage, have a file ready that contains a copy of the following information.

  • Property survey
  • Last tax bill
  • Ownership Deed
  • List of upgrades and their dates
  • Opening and Closing instructions
  • Water quality test results
  • Septic tank details
  • Water pump details
  • List of Chattel that outlines the items included with the cottage in the asking price.
  • List of Extras that outlines the items that are not included in the asking price but may be listed and sold separately if you want to get rid of them.  Boats, motors, trailers, ATV’s etc. are common items.

Keep receipts for all materials and labour costs applied to upgrading the cottage or cabin.  These can often be used to increase the original cost value of the cottage and therefore reduce the amount of capital gains that will be taxed once the cottage is sold.
Special Note: Always consult your accountant regarding tax matters related to the cabin or cottage.

How should you prepare the cabin or cottage for sale?
When getting the cottage ready for sale try to look at it from the point of view of a potential buyer.  If you were buying the cottage, what issues would stand out?

Outside The Cottage

  • Complete all maintenance projects that you have been putting off.
  • Remove all the junk that is stored under the cottage, behind the work shed, and in the bush. Common items include old bed frames, broken chairs, discarded mattresses, and rusted out BBQ’s.
  • Organize the tool shed.
  • Clean up lawnmowers, trimmers, chainsaws etc. and make sure they are working properly.
  • Get the septic system pumped out and inspected and display the receipt.
  • Have the water tested and put a copy of the results in the documents folder.

Inside The Cottage

  • Remove all of your personal items that may be cluttering up the place.  This includes toys, magazines, old rugs and carpets, bottle collections, pet food bowls, litter boxes, and photos.
  • Replace broken light bulbs.
  • Clean out the fridge and freezer.
  • Organize the kitchen.  Open shelf space makes the kitchen look bigger.

If you don’t get it all done, tell the truth about the things that still need to be fixed or replaced.  People appreciate the honesty just as you would.

Private Cabin and Cottage Sales

Deciding to sell the cottage privately can save you the commission costs associated with using a broker but you must take a number of things into consideration.

    Time
    Do you have the time (or energy) to answer inquiries from numerous interested people. 

    Distance
    Is it going to cost you a fortune to drive to the property every few days to show the property to tire kickers.

    Location
    Is the property in a high demand location.  If so, it will be easier to sell it privately.  Otherwise, you should consider hiring a broker.

    Market Conditions
    Is it currently a seller’s market or a buyer’s market?  If there are a lot of properties on the market you may have a tough time selling privately.  If properties are selling quickly, you may get lucky and find a buyer shortly after you advertise the property.

    Advertising
    The Internet makes advertising the property very easy.  Set up a web page for your cottage and list it with popular websites that show properties in your area.

    Listing With A Broker

    Using a real estate broker who specializes in selling cottages is usually worth the commission costs that are incurred, especially when selling a cottage in a difficult economy.  Consider listing with an agent who also owns a cottage in your area and knows the local market very well.

    Time
    The broker looks after answering all inquiries and shows the property to all interested buyers.

    Experience
    Real estate professionals know the market and may get you a better price.  They are also experts at knowing when a potential buyer is serious and can pour on the charm to get the deal done.

    Marketing
    Brokers will put your property on the MLS listing and on their own website.  They also attract other brokers who are trying to match customers with properties. The commission is a strong motivator to steer interest in your direction.

Recommended Reading:

Need more cabin or cottage property tips?
Go to the Estate Planning page.
Go to the Cabin and Cottage Buying Guide page.
Go to the Renting Out The Cottage page.

Advertisement