It's important to understand what legal responsibilities your real estate salesperson has to you and to other parties in the transactions. Ask your salesperson to explain what type of agency relationship you have with him or her and with the brokerage company.

1. Seller's representative (also known as a listing agent or seller's agent). A seller's agent is hired by and represents the seller. All fiduciary duties are owed to the seller. The agency relationship usually is created by a listing contract.

2. Subagent. A subagent owes the same fiduciary duties to the agent's principal as the agent does. Subagency usually arises when a cooperating sales associate from another brokerage, who is not representing the buyer as a buyer¿s representative or operating in a nonagency relationship, shows property to a buyer. In such a case, the subagent works with the buyer as a customer but owes fiduciary duties to the listing broker and the seller. Although a subagent cannot assist the buyer in any way that would be detrimental to the seller, a buyer-customer can expect to be treated honestly by the subagent. It is important that subagents fully explain their duties to buyers.

3. Buyer's representative (also known as a buyer's agent). A real estate licensee who is hired by prospective buyers to represent them in a real estate transaction. The buyer's rep works in the buyer's best interest throughout the transaction and owes fiduciary duties to the buyer. The buyer can pay the licensee directly through a negotiated fee, or the buyer's rep may be paid by the seller or by a commission split with the listing broker.

4. Disclosed dual agent. Dual agency is a relationship in which the brokerage firm represents both the buyer and the seller in the same real estate transaction. Dual agency relationships do not carry with them all of the traditional fiduciary duties to the clients. Instead, dual agents owe limited fiduciary duties. Because of the potential for conflicts of interest in a dual-agency relationship, it's vital that all parties give their informed consent. In many states, this consent must be in writing. Disclosed dual agency, in which both the buyer and the seller are told that the agent is representing both of them, is legal in most states.

1. Get estimates from a reliable repairperson on items that need to be replaced soon, such as a roof or worn carpeting, for example. In this way, buyers will have a better sense of how much these needed repairs will affect their costs.

2. Have a termite inspection to prove to buyers that the property is not infested.

3. Get a pre-sale home inspection so you¿ll be able to make repairs before buyers become concerned and cancel a contract.

4. Gather together warranties and guarantees on the furnace, appliances, and other items that will remain with the house.

5. Fill out a disclosure form provided by your sales associate. Take the time to be sure that you don't forget problems, however minor, that might create liability for you after the sale.

Hold a yard sale to reduce the clutter in your home and get rid of items you don't want to move.

1. Check with your city government to see if you need a permit or license.

2. See if neighbors want to participate and have a "block" sale to attract more visitors.

3. Advertise. Put an ad in free classified papers, and put up signs and balloons at major intersections and in stores near your home.

4. Price items ahead and attach prices with removable stickers. Remember, yard sales are supposed to be bargains, so don't try to sell anything of significant value this way.

5. Check items before the sale to be sure you haven't including something you want by mistake.

6. Keep pets away from the sale.

7. Display everything neatly and individually so customers don't have to dig through boxes.

8. Have an electrical outlet so buyers can test appliances.

9. Have plenty of bags and newspaper for wrapping fragile items.

10. Get enough change, and keep a close eye on your cash.

1. Get rid of clutter. Throw out or file stacks of newspapers and magazines. Pack away most of your small decorative items. Store out-of-season clothing to make closets seem roomier. Clean out the garage.

2. Wash your windows and screens to let more light into the interior.

3. Keep everything extra clean. Wash fingerprints from light switch plates. Mop and wax floors. Clean the stove and refrigerator. A clean house makes a better first impression and convinces buyers that the home has been well cared for.

4. Get rid of smells. Clean carpeting and drapes to eliminate cooking odors, smoke, and pet smells. Open the windows.

5. Put higher wattage bulbs in light sockets to make rooms seem brighter, especially basements and other dark rooms. Replace any burnt-out bulbs.

6. Make minor repairs that can create a bad impression. Small problems, such as sticky doors, torn screens, cracked caulking, or a dripping faucet, may seem trivial, but they¿ll give buyers the impression that the house isn¿t well maintained.

7. Tidy your yard. Cut the grass, rake the leaves, trim the bushes, and edge the walks. Put a pot or two of bright flowers near the entryway.

8. Patch holes in your driveway and reapply sealant, if applicable.

9. Clean your gutters.

10. Polish your front doorknob and door numbers.

1. Price it right. Set a price at the lower end of your property¿s realistic price range.

2. Get your house market-ready for at least two weeks before you begin showing it.

3. Be flexible about showings. It¿s often disruptive to have a house ready to show on the spur of the moment, but the more often someone can see your home, the sooner you¿ll find a seller.

4. Be ready for the offers. Decide in advance what price and terms you¿ll find acceptable.

5. Don¿t refuse to drop the price. If your home has been on the market for more than 30 days without an offer, be prepared to lower your asking price.

1. Hire a cleaning service. A spotlessly clean home is essential; dirt will turn off a prospect faster than anything.
   
   

2. Mow your lawn, and be sure toys and yard equipment are put away.
   
   

3. Serve cookies, coffee, and soft drinks. It creates a welcoming touch. But be sure the kitchen has been cleaned up; use disposable cups so the sink doesn¿t fill up.
   
   

4. Lock up your valuables, jewelry, and money. Although the real estate salesperson will be on site during the open house, it's impossible to watch everyone all the time.
   
   

5. Turn on all the lights. Even in the daytime, incandescent lights add sparkle.
   
   

6. Send your pets to a neighbor or take them outside. If that's not possible, crate them or confine them to one room (a basement or bath), and let the salesperson know where to find them.
   
   

7. Leave. It's awkward for prospective buyers to look in your closets and express their opinions of your home with you there.

1. Put fresh or silk flowers in principal rooms for a touch of color.
   
   

2. Add a new shower curtain, fresh towels, and new guest soaps to every bath.
   
   

3. Set out potpourri or fresh baked goods for a homey smell.
   
   

4. Set the table with pretty dishes and candles.
   
   

5. Buy a fresh doormat with a clever saying.
   
   

6. Take one or two major pieces of furniture out of every room to create a sense of spaciousness.
   
   

7. Put away kitchen appliances and personal bathroom items to give the illusion of more counter space.
   
   

8. Lay a fire in the fireplace. Or put a basket of flowers there if it¿s not in use.
   
   

9. Depersonalize the rooms by putting away family photos, mementos, and distinctive artwork.
   
   

10. Turn on the sprinklers for 30 minutes to make the lawn sparkle.

To find out how much money you¿ll net from your house, add up your closing costs and subtract them from the sale price of the house.

1. Give your forwarding address to the post office, usually two to four weeks ahead of the move.

2. Notify your credit card companies, magazine subscriptions, and bank of the change of address.

3. Develop a list of friends, relatives, and business colleagues who need to be notified of the move.

4. Arrange to have utilities disconnected at your old home and connected at your new one.

5. Cancel the newspaper.

6. Check insurance coverage for moved items. Usually movers only cover what they pack.

7. Clean out appliances and prepare them for moving, if applicable.

8. Note the weight of the goods you'll have moved, since long-distance moves are usually billed according to weight. Watch for movers that use excessive padding to add weight.

9. Check with your condo or co-op about restrictions on using the elevator or particular exits.

10. Have a "first open" box with the things you'll need most-toilet paper, soap, trash bags, scissors, hammer, screwdriver, pencils and paper, cups and plates, water, snacks, and toothpaste.

Plus, if you're moving out of town:

1. Get copies of medical and dental records and prescriptions for your family and your pets.

2. Get copies of children's school records for transfer.

3. Ask friends for introductions to anyone they know in your new neighborhood.

4. Consider special car needs for pets when traveling.

5. Let a friend or relative know your route.

6. Carry traveler¿s checks or an ATM card for ready cash until you can open a bank account.

7. Empty your safety deposit box.

8. Put plants in boxes with holes for air circulation if you're moving in cold weather.

1. Owner¿s manuals for items left in the house.

2. Warranties for any items left in the house.

3. A list of local service providers¿the best dry cleaner, yard service, etc.

4. Garage door opener.

5. Extra sets of house keys.

6. Code to burglar alarm and phone number of monitoring service if not discontinued.

Make your home more appealing for potential buyers with these quick and easy tips.

1. Trim bushes so they don¿t block windows and cut down on light.

2. Buy a new doormat.

3. Put a pot of bright flowers (or a small evergreen in winter) on your porch.

4. Put new doorknobs on your doors.

5. Put a fresh coating on your driveway.

6. Edge the grass around walks and trees.

7. Keep your garden tools out of site.

8. Be sure kids put away their toys.

9. Buy a new mailbox.

10. Upgrade the outside lighting.

11. Use warm, incandescent light bulbs for a homey feel.

12. Polish or replace your house numbers.

13. Clean your gutters.

14. Put out potpourri or burn scented candles.

15. Buy new pillows for the sofa.

16. Buy a flowering plant and put it in a window you pass by frequently.

17. Make a centerpiece for your table with fruit or artificial flowers.

18. Replace heavy curtains with sheer ones that let in more light.

19. Buy new towels.

20. Put a seasonal wreath on your door.

When you sell a stock, you owe taxes on your gain-the difference between what you paid for the stock and what you sold it for. The same is true with selling a home (or a second home), but there are some special considerations.

How to Calculate Gain

In real estate, capital gains are based not on what you paid for the home, but on its adjusted cost basis. To calculate this:

1. Take the purchase price of the home: This is the sale price, not the amount of money you actually contributed at closing.

2. Add adjustments:

• Cost of the purchase-including transfer fees, attorney fees, inspections, but not points you paid on your mortgage.

• Cost of sale-including inspections, attorney's fee, real estate commission, and money you spent to fix up your home just prior to sale.

• Cost of improvements-including room additions, deck, etc. Note here that improvements do not include repairing or replacing something already there, such as putting on a new roof or buying a new furnace.

3. The total of this is the adjusted cost basis of your home.

4. Subtract this adjusted cost basis from the amount you sell your home for. This is your capital gain.

A Special Real Estate Exemption for Capital Gains

Since 1997, up to $250,000 in capital gains ($500,000 for a married couple) on the sale of a home is exempt from taxation if you meet the following criteria:

• You have lived in the home as your principal residence for two out of the last five years.

• You have not sold or exchanged another home during the two years preceding the sale.

Also note that as of 2003, you also may qualify for this exemption if you meet what the IRS calls "unforeseen circumstances," such as job loss, divorce, or family medical emergency.

Reprinted from REALTOR^® Magazine Online by permission of the NATIONAL ASSOCIATION OF REALTORS^®

Copyright 2005. All rights reserved.