Selling a home by yourself in Hawaii is no easy matter. With complicated state and local regulations governing the sale, along with potential legal issues, there are a number of things you need to know before selling a home in the Aloha State.
Your Real Estate Agent
Selling your own home requires knowledge of the applicable local and state laws as well as how to market and find suitable buyers. Locate a licensed real estate agent at Realtor.com or by getting a referral from another professional. Find a resourceful and focused agent with a proven record of success.
What Is the Listing Agreement?
There are three kinds of real estate listings:
- Open listing: The owner retains the right to sell the home and only pays the broker if he or she brings in a buyer.
- Exclusive agency listing: The owner can sell the home and only pays a commission if the broker was the procuring cause of the sale.
- Exclusive right to sell listing: The seller agrees to pay a commission to the listing broker who does what it takes to sell the home.
Setting the Selling Price
Your agent generally determines the selling price by comparing prices of similar homes that have been listed in the area within a quarter- or half-mile of your home. Your agent has certain responsibilities including:
- Sales price and commission
- Effective period of agreement
- Duties and obligations of seller and broker
State Disclosure Requirements
State law requires the seller to provide certain disclosures including known defects in the home’s structure, as well as:
- Whether the home is within boundaries of certain designated areas
- Erosion issues
- Utility costs
- Lead-based paint
The failure to disclose known defects or to make other required disclosures can expose you to a lawsuit. Home sellers are required to use the Hawaii Seller Real Property Disclosure Statement. Generally, if an inspection turns up material defects, the buyer can insist that you remedy the defect or lower the purchase price so the transaction can go forward.
Receiving an Offer
An offer to pay a certain price based on certain terms and conditions is not a legally binding contract until the buyer accepts the offer and notifies the buyer of its acceptance. A counteroffer rejects the original offer based on price or the terms and conditions. Once the parties agree on the terms of an offer, it goes into escrow where the buyer deposits certain funds into an escrow account.
What Is the Purchase Agreement?
A real estate purchase agreement is a legally binding contract for the sale of real estate and includes terms and conditions such as:
- Identity of the parties
- Price and financing terms
- Guarantee of clear title
- Date of closing and inspection
The close of escrow means that the transaction has been completed and the sale is final. All documents have been transferred and fees paid. As the seller, you need not be present at the closing so long as all costs and fees are paid and documents are signed. You may have to turn over the keys to the buyer the same day as the closing if the deed is recorded unless other documented arrangements have been made.
Assistance from a Real Estate Lawyer
This is a brief introduction to selling a house in Hawaii and is not meant to be comprehensive. As state real estate laws are complex, you should seek assistance from a real estate attorney.