5 Home Selling Mistakes to Avoid

There are a lot of different mistakes to be made in a home sale. Here are five that you need to make sure you avoid.


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Selling a home is a complicated process. There are a lot of different dos and don'ts, but we’re going to focus on the don'ts today. Here are five things that you should NOT do when preparing your home for the market:

1. Remodeling your kitchen or bathrooms. Although this goes against conventional thinking, there is evidence to back up our claim. The National Association of Realtors has consistently determined that those are some of the worst areas for return on investment. The place where you get the most bang for your buck is actually the deck.

2. Keep wallpaper. I do not recommend installing or even keeping outdated wallpaper, unless you have a luxury home that was designed by a professional. Most buyers don’t like wallpaper.

Replace bold colors with neutral, natural tones.

3. Bold colors. You want your home to be as appealing as possible to buyers. Tone down those bold colors to appeal to a wider audience. You want more natural, neutral colors in your home when selling.

4. Replace carpet with carpet. Most of the time, you can add more value for the same price by replacing carpet with a nice looking hardwood laminate. That’s a pretty good upgrade to do.

5. Gaudy light fixtures. Replace old brass fixtures and modernize them. Above all else, keep them simple.

If you have any questions for us about preparing your home for sale or any other questions about buying or selling, give me a call or send me an email. I would love to hear from you.

How to Avoid Paying Capital Gains Tax

Today I want to talk to you about the “Two of Five Rule,” the best way to avoid paying capital gains taxes.


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How can you negate capital gains taxes during the sale of your home? I’ll answer that and draw out an example for you in the video above today.

Let’s say you are going to sell your house for $600,000, but you originally paid $300,000 for it. Your tax will be based on how much profit there is between that spread. The closing costs will be about $50,000 and you can write off any capital improvements you’ve made. As an example, I used $20,000 in capital improvements, which puts your new base at $530,000 after you subtract the closing costs and capital improvements.

From the $300,000 purchase price to the new base of $530,000, that’s a $230,000 spread. That is the amount the IRS will tax. The good news is something we call the “Two of Five Rule.” If you are a single person and you have lived in the house for two out of the last five years, the IRS will allow you to be exempt for up to $250,000 worth of capital gains. So, with our example, you won’t owe a penny of capital gains tax.

Make sure you’ve lived in the home for two out of the last five years.

If you’re a married couple, you get to double that exemption to up to $500,000 as long as you have lived in the house two out of the last five years.

This means if you have lived in your house for a year and 10 months, it’s best not to close until after you have hit that two-year mark. Otherwise, you’ll lose out on the exemption. On the flip side, if you moved out of the house a couple years back and have been renting it, you want to make sure you sell it when you can still say you lived there for two of the last five years.

If you have any more questions or are looking to sell your home, please don’t hesitate to give us a call or send us an email. We look forward to hearing from you!

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