What is so hard about selling your home by owner?
I want to sell my home. I don’t want to pay 00+ in commissions. I’ve seen lots of posts and heard often that it isn’t worth the hassle to sell on my own and to just use a real estate agent. I want to know what the hard part/hassle is. Is it the marketing or the paperwork or something else? My wife thinks having an agent is all about getting your listing in the MLS. How big a role does this play?
9 Responses
Angie
12 Feb 2010
REALLY
12 Feb 2010
i say advertise, advertise, advertise. treat this sale as though you are going to make an additional 7,000.00. this will give you incentives on selling. clean your place up for goodness sakes, take your own photo and display it in the paper. go for it…
ladykay
12 Feb 2010
I’d say the hardest part is the advertising of your home. The real estate agent does put in on MLS which other realitors flock too. Also, if you don’t offer a commision to the realitors representing the buyers, nobody will show your house. Good luck!
The Real Estate
12 Feb 2010
The best tool to sell a property is the Realtor-owned Multiple Listing Services. You have to be a licensed real estate agent to belong.
Selling by owner, your only exposure is your "For Sale" sign and whatever advertising you engage in.
Did you know that whatever commission is paid to a real estate agent is split into about 4 equal parts. I.E. 5%. Agent makes about 1.5% off of that. This applies whenever 2 agents are involved in a sale.
Remember, Commissions are negotiable!
Take care and good luck.
old lady
12 Feb 2010
The hard part isn’t selling your home — it is, as you guessed, the paperwork. More particularily, the legal ramifications. Today, buyers can opt out of a deal on so many grounds it would make your head spin, unless all the ramifications are covered. They can also sue if you don’t tell them about problems with the house – for example, if you ever had termites, or a leaky roof, or a swamped basement, etc.etc.etc. You can sell the house yourself if you have a lawyer check the contract, but make sure you get someone who really knows real estate law.
Your wife is correct that the MLS listing is a plus, but there is more to it than that, and in today’s market, people are willing to read classified ads, or to check out a house in the area they want, that has a For Sale By Owner sign in the front yard.
Basically, if you do decide to do it on your own, make sure you get some sound advice – check out the library, for starters, or a large bookstore, and make sure the book you get is up to date. Then check with city hall to make sure there are no restrictive covenants in your area, and if they are, you can inform prospective buyers. Some of these are sneaky little things, like not being allowed to have an outside clothes line. Dumb, but that’s a popular covenant in new subdivisions.
Good luck with it.
satarnag
12 Feb 2010
Three parts:
1.comping your home for maximum value
2. MLS for exposure and paying other agents to find you a qualified buyer.
3. Paperwork to protect yourself from law suits and to ensure a smoothe transaction.
To do it yourself, I suggest you get a free market analysis from one of your local Realtors. Pay a broker $200-$400 to do a MLS only listing. Pay a lawyer or real estate agent to do the paperwork.
Regards
godged
12 Feb 2010
Good question.
Having an agent isn’t "all about getting your listing in the MLS" – but it certainly doesn’t hurt. About 80% of buying and selling goes through the MLS, and if your house isn’t there, you’ve lost a good portion of your customer base.
When you list with an agent, you are getting your home exposed to all the other agents and their clients. Clients that are pre-screened and typically pre-qualified to buy. An agent checks comparable properties to make sure the price is right. They give suggestions to make the house more marketable. They spend money on signs, advertising, field the calls, handle the looky-loos, etc., etc..
Ask anyone that has been through For Sale By Owner (FSBO) and they will tell you that they received tire kicker phone calls, low ball offers, professional house shoppers who never intend to buy and people just wasting their time.
Advertising isn’t cheap, and you probably won’t sell your home without it.
The paperwork can be difficult. When offers come in, you should get them reviewed by your real estate attorney to make sure you are not embarking on a bad deal. There are pre-drawn forms available at any decent office supply store, but are you prepared if an offer comes in with a number of contingencies?
Some people go through the FSBO process with no problems. Just do your homework.
alamo
12 Feb 2010
It is both.
There are instances that selling your home on your own may work great, but the chance of it not going as planned is most likely worth the investment in a professional knowledgeable agent.
Not only do agents have access to the MLS, they also cooperate daily with other agents in the business and within their own company. Their relationships with other agents as well as their sphere of influence provide an invaluable resource that homeowners often cannot match. In a down market this may very well be the difference in selling your home and not selling your home.
Real estate agents are also experienced with writing contracts, understanding the vulnerabilities of contracts, knowing the art of negotiation, maintaining closing time lines, limiting seller liabilities, and other knowledge which eases one of the largest transactions most people will ever make.
It is a personal decision and many people are capable of successfully navigating themselves through a real estate deal without the help of an agent, but the chance of things not going as planned is almost always worth the expense.
A good agent will also maximize the profits from selling your home, meaning you may walk away with more money because your agent priced your home right, negotiated the deal correctly, and saved unneeded expense during the request for repairs period.
Best of luck to you
darinalvarezreal
12 Feb 2010
The three problems most people have selling their own home are:
1. Advertising – Most buyers are represented by agents, agents use the MLS and expect a commission. For Sale By Owners don’t have access to that. You can advertise in the paper but only a small percentage of buyers will see it. There are website you can use to increase that, but you will still reach less buyers than an agent can. Also you pay all the costs up front, weather your home sells or not. With an agent they front the cost, you only pay the commission once the home sells.
2. Experience – most people don’t have the real estate experience to deal with advertising, contracts, pricing, qualifying buyers, etc. This you can learn but it will take a lot of reading and some help, preferably from a real estate lawyer. If you go it alone and something goes wrong, the only one you can blame is yourself.
3. Time – Most working adults don’t have the time that you need to dedicate to this to do it effectively. It takes an average of 8 hours per week to sell a house. This time includes advertising, answering calls, showing the home(not always at a time that works into your schedule) preparing paperwork, and communicating between title companies, inspectors and the like.
Bottom line – be sure you are ready to take on such a big project. While some do successfully sell their own homes, they really do earn that 6%, just like an agent would.
MLS does play a large portion, it gets your house more exposure that it would if you advertised elsewhere. However, if you don’t have a real estate agent, you better have a really good lawyer. Any purchase contract should be reviewed by lawyer first. Also, will you know if the buyers are financially qualified to purchase your home? And do you even know how much your house is worth in the first place? If you set the price too high, no one will want to buy. If you set it too low, you cheat yourself. Just a few things to consider.