is it a good idea to try to save money by selling your own home, or is the risk too high?
i live in an affluent suburb, and am considering selling my own home which i think will be a fairly marketable piece of property (rather than going through an agency and paying the brokerage fee). good idea? bad idea? with some decent marketing savvy/investment and a good real estate attorney can i save myself the 6%? are there any potential negative ramifications (e.g. from the real estate agency community)?
- 1 decade agoBest Answer
This can work in many instances, but don't expect to save the full 6%. Some things to consider:
1) Are you willing to do all the work (advertising, open houses, etc...)
2) Is your area "hot" - if there are a lot of other homes selling nearby, it will be easier. People will see your sign and call. If the market is cold, the realtor (or you) will have to do a lot more work.
3) Don't expect to get the full 6%. When someone buys "By Owner", they expect a bit of a deal. They will expect some of that commission as well.
4) If you want to multilist your home, there are places that will do it for you, but it will cost money. Also, if you don't offer enough of a sellers commission in the multilist, realtors won't bring people to your house.
I live in a condo complex where units are bought/sold every month. Here, it's fairly easy to sell by owner. People see the open house signs and visit while shopping for realtor-sold houses. If I lived at the end of a secluded cul-de-sac, it would be harder.
- Anonymous1 decade ago
You can do it, and I bought a FSBO house once: it was a good deal for both of us. The biggest problem is publicity; the real estate listings are accessible over the internet, and getting your place before the public without having on the internet will drastically reduce its exposure. Only the most dedicated shopper will pore through the classified these days when a search engine can present hundreds of suitable properties in seconds. You will need to decide whether to do "broker cooperation": pay 3% to a buyer's broker if one shows up. There are operations which, for a fixed fee, will put your listing on the internet without doing the full seller's broker's job. Finally, you will have to worry about constructing a contract if a buyer appears; I wrote the contract for the FSBO that I bought, but I knew what I was doing and no problems arose. You may want advice here; you are talking about many thousands of dollars, and a mistake could be very expensive.
- 1 decade ago
1) You property won't be listed on the MLS if you go the "For Sale By Owner" route.
2) Most REALTORS® won't show you home if you don't offer them a commission for bringing a buyer. You'll most likely have to offer a REALTOR® who brings a buyer at least 3% - and some will want more because they are going to have to double check all of your paperwork and do some extra leg work to make sure everything is legal and up to snuff.
3) You will have lots of out of pocket costs to deal with. Advertising, signage, flyers, open houses, etc.
4) Do you have a network of REATLORS® you can call or notify that you home is for sale and ask them to come take a look? Most REALTORS® work with both buyers and sellers. You need to advertise to REALTORS® with buyers. Do you know who they are and how to contact them?
5) You will have to conduct your own showings. Can you be available during the day Monday thru Friday?
6) Who are you going to let into your home? Just anyone who wants to see it? REALTORS® don't show you home to anyone who hasn't been through their qualification process. Also, the REALTORS® key system (in areas with electronic keys) keeps track of each and every time someone enters your home. Be careful - some criminals visit open houses just to see what goodies you have and then they come back later to steal your stuff.
7) Do you really know how to accurately price your home for the marketplace?
8) Do you realize that about 95% of all FSBOs (For Sale By Owners) that are actually sold end up getting sold to investors who pay rock bottom prices?
9) Did you know that most FSBOs eventually end up selling with a REALTOR® after their owners get totally frustrated with the process.
10) Do you know how to qualify a buyer? How do you know if the sale will hold together through the closing?
11) Do you know what to look for in a mortgage pre-approval letter? How do you know it is worth the paper it is written on?
12) Do you know how to process and file all of the paperwork?
13) Do you know the legal ramifications if something goes wrong?
14) Do you know how much it costs up front to hire a real estate attorney? An appraiser? A title compnay? An inspector?
15) Do you know that a REALTOR® only gets paid IF and WHEN you home sells and actually closes?
Buying or selling a home is the biggest investment most people ever make. In my opinion, you shouldn't do this without professional help.
Would you represent yourself in court, or would you hire a lawyer?
Would you operate on yourself, or you you hire a skilled surgeon?
Make this decision carefully. But by all means, feel free to try it yourself. Chances are that after you spend a couple of thousand of dollars, you will get frustrated and hire a REALTOR®.
This is not a complete list, but it gives you an idea of just some of the things that you need to be aware of.
I hope that helps.
In the interest of full disclosure - I am a REALTOR®, licensed in Minnesota.Source(s): www.househuntinghound.com
- 1 decade ago
You should not have any trouble from real estate agents, but the re agent would take care of showing the house and make sure that every transaction was handled legally and properly. State laws are different throughout the country and each have regulations that must be adhered to. There are also federal regulations that must be followed, such as the fair housing and lead paint disclosure. I have seen attorneys that do not know the laws and can get you in trouble with the authorities. Also a good agent can maximize your sale price and can save you money if they do their job.Source(s): Real Estate professional.
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- HomesliceLv 41 decade ago
I tried FSBO last year. It was a miserable experience. We setup a website with pictures an information and we bought a really nice custom sign for the front yard with information sheets. We lived in a hot neighborhood too. When it came down to it, buyers have a realtor because it doesn't cost them anything but the realtor they use expects to be paid by the seller. We even tried to coop and pay a 3% commission to the buyer's realtor. Nothing worked. I truly felt like realtors were purposely steering buyers away from our house. After we got a realtor, the house went fairly quick.
I think in a better market, it might have gone better. I think it is truly possible, but it is a lot of work and you might be fighting a losing battle.
A 2nd option might be to interview a few realtors and try to negotiate their commission.
- JonylLv 44 years ago
i never did rent out homes, but know someone that did it. he hated it because there was always trouble with the tenants (face it if you buy low budget homes you probably rent them to low budget tenants). he made a lot of money with flipping houses but hated the renting business and i think eventually got back out of it. flipping might still be a good idea if you are handy and know people that can help. remember that tenants have a lot of protection from the law, so once you have a bad apple in it's hard to get them out. and you might also need to pay the mortgage yourself if they won't or can't pay and renovate before rerenting and still carrying the cost.
- 1 decade ago
Have you seen how many question about selling and buying real estate people post here? If they think they know how to do it, why do they get into a huge mess and have so many problems?
Yes, it's possible to sell yourself, but only if you really know what you are doing. Here's just one example: do you know all the disclosures you need to provide as a seller? All of them? Do you know what to do and what are your rights, if a buyer wants to get out of a contract 5 days after you accepted their offer? Do you know how to write a Notice to Perform, if a buyer is not doing something he is supposed to do?
I can give you a hundred more examples like this...
- Roland'sMommyLv 61 decade ago
You CAN sell your house without a realtor, they just have more connections. Especially since buyers who are QUALIFIED for loans are few and far between (and are probably using a realtor), I'd just suck it up and pay the 6%. It's going to be tough to sell as it is.
But, if you're in no hurry to leave, go ahead and try. It couldn't hurt.
- Mean CarleenLv 71 decade ago
Other than not covering every aspect I can't see a problem
- Anonymous1 decade ago
as long as you can market it, I say do it yourself (the only advantage of a broker is access to the multiple listings - otherwise they are mentally vacant)