Sell Your Home Without a Realtor and Save Thousand$$$
A typical real estate commission on a $284,600 home (national median price for all existing homes as of May 2020) is over $19,000. In many areas the cut a real estate broker gets is much higher. A home owner can easily save that money by selling on their own. All that is needed is a basic understanding of the real estate market and a touch of marketing sense. Here are the “Big Five” of selling any home.
1. Pricing. Set a realistic asking price. While it might be tempting to inflate the asking price just in case someone really loves the home or to make room for negotiations, the consequence is a home that can’t stand the competition. The market always sets the price. Find out what the competition has to offer and set your price consequently.
The best way to do this is have three or four real estate brokers provide a free market examination. Yes, you will be wasting their time if you sell on your own. But don’t worry; real estate brokers are used to having their time wasted. If we earned a $20,000 commission every time we went out we’d arrive at your home in a limousine. Fact is, nine out of ten outings are a bust for us. It’s the main reason why commissions are as high as they are. In any event, you may end up listing with one of them. Fact is, selling by owner really isn’t for everyone. But pricing your home correctly is the first step in a successful transaction.
If you choose not to have a market examination from your local Realtors you will have to do your own calculations. In order to do that you will need a fresh batch of comparable sales. The best place to get these is from your local assessor or municipal records. You will need between three and five recent comparable sales. Make sure they really are comparable. They must be in the same location (ideally within a half mile) they must be the same style and size as your home (number of bedrooms, baths, garage, etc.) and they must be in the same condition as your home. excursion by each. Take pictures.
The hard part is when you can’t find exact comparables. You will then have to make adjustments for the differences. The best way is to ask your assessor how much an additional bath, for example, influences the market value. Hopefully they will provide an approximation.
If you can’t come up with an accurate dollar amount consider hiring a specialized appraiser. They can be found in the yellow pages or online. And while the service costs several hundred dollars it’s a small price compared to what you will save by successfully selling on your own.
Avoid pricing your home based on how much you paid, how much you owe, the amount of the municipal assessment, the cost of improvements you have additional, or what a friend or neighbor thinks it’s worth. The market doesn’t care a bit about these factors.
However you arrive at a price it will usually be expressed as a price range. Aim for the upper end of the range if your home is generally in better condition and has nicer amenities than the competition. Aim for the low end if you need a quick sale. Otherwise stay in the middle and prepare to be flexible.
2. turn up. My father always said, you never get a second chance to make a first impression. Nowhere is this truer than marketing your home. Anything amiss–including a funny smell–will send your prospects on to the next house. Take a picture of the front. Compare your “curb allurement” with the pictures you took of the competition. Pretend your home is going to be in House Beautiful Magazine. Clean, paint, resurface, mow, weed, trim, plant, replace anything that looks shabby or worn.
Now step inside. See your home as if for the first time, as buyers will. A fresh coat of paint, new draperies, and new carpeting (or specialized cleaning) will do wonders for your sales allurement. Again, consider what you would be paying a Realtor. Remove all clutter and excess furniture. The only items in a bedroom should be a bed and a dresser. Anything else makes the rooms look smaller.
Next estimate the kitchen and the baths. These are the single most important rooms in the house in terms of buyer allurement. Again, clean, paint, and consider replacing the flooring with something light and bright. Wash the windows. If your appliances or fixtures are old consider replacing them. Most buyers these days are including a contingency in their offer to buy contract for a specialized home inspection. If an appliance or fixture is a problem it will be noted and the buyer will expect it to be replaced–or void the contract. Might in addition get that part out of the way up front when it can raise your marketing efforts. This is true of any structural, mechanical, electrical, foundation, roof covering, or plumbing system, etc. in the house. If there’s a problem it’s best to take care of it beforehand. In many areas state and federal disclosure laws mandate that an owner discloses any problems they are aware of, including the possible presence of rule paint, mold, radon, or asbestos. Be aware of these laws. A good way is to hire your own inspector before the house is put up for sale.
3. Advertising. When the house is bright and shining to the point where you surprise if you really want to sell such a treasure it’s time to hit the market. This is the easy part. Run print ads in the leading daily newspaper noted for home classifieds. Consider Google ads. observe the price, location, number of bedrooms and baths and the three nicest features of your home–the things that made you buy it in the first place. You needn’t bother with monthly publications such as For Sale By Owner magazines. Buyers quickly discover that by the time a good home is listed it’s sold. If you use the Internet, make sure the site is very popular. The easiest way to do this is go into a search term a local buyer would use in Yahoo or Google. for example: you would search “homes for sale in (your town)” or “home listings in (your town)”. Make sure the site you’re considering comes up on the first page. You may also want to forego open houses. Only 1% of homes ever sell on open house. What you mostly get are “Looky Lews” and disinctive neighbors.
Use free information of mouth advertising. Tell everyone you know, neighbors, friends, family, coworkers that your home is for sale. Invest in a specialized yard sign. observe the basic features of the home as in your ad in addition as “By Appointment Only” but don’t list the price. Be obtainable to make appointments when your ads are running. Don’t rely on voice mail.
Consider a Flat Fee MLS listing. For a fee typically beteen $99 and $995 a broker will list you home on the Multiple Listing Service where the great majority of qaulified buyers find their homes. Many Flat Fee Brokers also syndicated the listing across the web on sites like Zillow, Trulie, Realtor.com, etc. The scope of this topic is best presernted in thoroughness in other places. See link at bottom of page for additional Flat Fee Realtor information.
When the buyers arrive give them a warm welcome. Have the dinning room table set with your best china. Place fresh flowers. If you have a whirlpool tub put out a bottle of Champaign and two glasses. Bake bread or cookies, or just put a little vanilla and cinnamon in the oven at low heat.
4. Negotiations. If you’ve followed the plan up to now you will soon be getting offers. Be prepared for a low offer but when any offer comes in always insist on a pre-approval letter from the buyer’s lender. Review the offer with your attorney. You can counter the offer but be aware that the buyers are under no obligation to accept your counter-offer. And that anything but complete acceptance of their offer usually voids it. All terms of the contract are negotiable, not just the price.
Do not, under any circumstances, become emotionally involved in the negotiations. This is the one area owners are never as good at as Realtors (except when it’s the Realtor’s own character in question). Consider only whether you can realistically do better and that the amount you will net will allow you to proceed with your move.
When price and terms are agreed upon get everything in writing. Do not fail to use a qualified real estate attorney.
5. Processing Period. The time between when a contract is fully executed and the time you give possession is when all contingencies in the contract are met. Different areas have different customs as to who does what and who pays the bill. But in general there will be a time period for both the buyer and the seller to have the contract ratified by their attorneys. In addition, a mortgage contingency will allow the buyer to obtain financing based on their qualifications and the bank’s appraisal of the home’s worth. Usually there is a provision for a structural inspection, as noted earlier, for the buyer to estimate the condition of the home. A target closing date is also included when possession is given the new owners. Generally, this is an calculate of move of ownership with delays shared, unless wording such as “time is of the essence” is incorporated into the contract. Beyond the basics there are a large number of other possibilities for contingencies in a contract. Anything, in fact, that is legal can be included. That’s why you should always use a real estate attorney.
Finally, the closing day comes and it’s on to your next dwelling. It’s been a hard road–much harder than most people expect–but the additional money you save will go a long way towards easing your pain in your new home. Enjoy!