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-   -   Should I sell my house without an Agent? (http://www.early-retirement.org/forums/f28/should-i-sell-my-house-without-an-agent-64940.html)

Cloverissweet 02-04-2013 08:18 AM

Should I sell my house without an Agent?
 
I brough my house 2 years ago. However I need to relocate by the end of this year. My house is worth $175K, however it will cost my a 9%-10% commission (what my area charge). That is a huge chunk of money, so I wonder if I can just do it myself?

I just clean up the house, post the sale on Trulia/Craigslist. However do you guys have any suggestions?

I never sell a house before, but willing to make the effort if I can save a couple grands. I think I still need to pay some commision to the buyer's agent, but at least I have dont have a pay a seller.

Any advises? Is it worth it?
Thanks

A side note: I was going to use the same real estate agent that helped me buy this house. Is this a good idea? Or maybe she can just represent the potential buyer and I dont have to get in a contract with her being my seller's agent.

REWahoo 02-04-2013 08:40 AM

Clover, here is some very good information on selling your house yourself:

http://www.early-retirement.org/foru...use-21501.html

Midpack 02-04-2013 08:51 AM

I thought 5-6% was a customary realtors selling fee, and I've never seen higher than 6% on any house I bought or sold. However, everything I read says realtors fees have become much more negotiable than they used to be, depending on the local market I presume.

I've never tried FSBO or equivalent, but these points seem like they'd be common pitfalls for selling without an agent.
Quote:

Highlights
  • FSBO process takes a lot of legwork, offers no guarantees.
  • Mispricing home is common mistake that stalls sales. [I'd bet this is all too common]
  • Thick skin necessary to handle criticism of home.
5 questions to ask
  1. Do I know the value of my home in today's market?
  2. Am I ready to work with a buyer's agent?
  3. Will I take charge of sales and marketing responsibilities?
  4. Can I bear criticism of my home?
  5. Am I willing to screen potential buyers?

Should you sell home without a real estate agent?

Best of luck whatever you decide.

Dawg52 02-04-2013 09:19 AM

I have sold 2 houses myself. Those went pretty well. I will have 2 small house to sell in a few years in a not so good neighborhood. I plan to use an agent with those to help with the screening process. I'm just not up to some of the headaches you have to deal with this go around.

Texas Proud 02-04-2013 09:32 AM

Are you in an area where the house will sell quickly??? IOW, if you can get a lot of traffic on your own then maybe it would be worth it...

But, if you live in an area where there are a lot of houses and they sit... you will probably get zero traffic..

Also, how comfortable are you with the legal docs??? Me, I am comfortable with legal docs buy would never want to sell a house on my own... to many possible changes in the laws that I might miss which could cost big time...

We just did a refi and I was very surprised how many docs we had to sign... more than when we bought the house 3 years ago...

KB 02-04-2013 09:34 AM

I sold a house using a 'For sale by owner' broker about 10 years ago. It was a flat fee of about $6000 if I found the buyer and the broker did all the legal paperwork. I had open houses to bring in the buyer and the broker walked me through every step. I would certainly do that again when I sell my next house.

pb4uski 02-04-2013 09:46 AM

I've sold a waterfront lot and a house FSBO. Back when I was in college I was a licensed real estate agent (as was my Dad) so I understand the process well.

In our area, commissions are typically 6% (3% to listing broker and 3% to selling agent). When we were selling our house we had a couple of agents representing buyers approach us and they wanted their 3% cut if they brought a buyer to us, and we were ok with that.

While I have heard that commissions for condos are higher, 9-10% is outrageous for a house.

If you understand the house buying/selling process well you can do it, but as others have mentioned there is some time consuming work involved.

Midpack 02-04-2013 09:47 AM

Quote:

Originally Posted by Texas Proud (Post 1279733)
Are you in an area where the house will sell quickly??? IOW, if you can get a lot of traffic on your own then maybe it would be worth it...

But, if you live in an area where there are a lot of houses and they sit... you will probably get zero traffic..

Also, how comfortable are you with the legal docs??? Me, I am comfortable with legal docs buy would never want to sell a house on my own... to many possible changes in the laws that I might miss which could cost big time...

We just did a refi and I was very surprised how many docs we had to sign... more than when we bought the house 3 years ago...

Good points. I'd add the condition and how up to date the house is will dictate a lot as well. You're going to compete with turnkey homes on the market, so if yours is a house needing a lot of updates, even with a substantial discount in a good market, it could be a really tough sell. Most of today's buyers (especially both spouses working) don't have the time/imagination/free cash to deal with extensive remodeling. The more turnkey the house, the easier it will sell.

sailor 02-04-2013 12:07 PM

Several friends had good experience with Redfin (although more of them on the buying side, than selling).
But if you don't want to do FSBO, consider giving them a try ( total cost is 4.5%, 1.5% for Redfin and 3% for buyer's agent).

ziggy29 02-04-2013 12:20 PM

Independent of whether or not you sell it yourself, I can't believe the "going rate" is 9-10%. Now maybe with reduced sales and sale prices not keeping up with inflation they feel like they had to raise it in order to make ends meet, but 9-10%? I'd negotiate hard on that one.

martyb 02-04-2013 12:54 PM

When I was working as a realtor in Shreveport-Bossier City, LA, the normal rate for residential property was 6%, and open land with no improvements was 10%. Everything is negotiable, including real estate listing fees. However, that doesn't mean a real estate broker will accept a lower commission. Technically, it's negotiable, but in reality, if your local market is healthy & realtors are enjoying prosperity, they're less likely to be willing to take a pay cut.

BTravlin 02-04-2013 01:25 PM

I've sold all three of my previous houses by myself and all three transactions went off without a hitch. On two of those I paid a 3% commission to the buyers' agent and one was a straight private party sale with no commission paid. I'm getting ready to put my current house on the market and will attempt to sell this one myself as well. The current market does make the task seem much more daunting this time around but the potential savings are worth it to me. My home is in the $300k range so I could save $9-18k depending on whether or not I have to pay a buyer's agent. I'm willing to invest some time and effort for those king of savings.

Curb appeal is number one. The outside needs to be well landscaped and present an inviting appearance. Once inside, buyers need to see a clean home that is relatively up to date. Some areas may need updating but only some of those are worth putting the money into yourself. Many people would prefer to get a discount off the price and then use the savings to update according to their personal taste rather than see your brand new pink striped master bath. Also, many updates will not generate enough of an extra return to cover the cost of the renovation. You can do some research to see which ones work in your area. New paint is relatively inexpensive, especially if you DIY, and really helps make the house look fresh and clean. Go with neutral colors that anybody can decorate around and stand to live with for a few years.

Research your market area well for comps and set your price competitively. I even paid $275 for an appraisal because that is what is driving sales these days. The banks will only make loans against a reasonably appraised house these days. It does no good to have an offer at $150k if the appraisal comes in at $125k because your buyer will not be able to secure a mortgage. I'm taking the appraised price and adding $12k to that because everybody knows, or still thinks, the market is soft and they will counter whatever price you are asking so have some room to negotiate so they feel like they got a good deal.

Many areas now have a fee service where you can list your home on the local MLS and this is a good idea as you get maximum exposure. Set your bottom line price and if you get an offer at that price or close to it then take the money and run. Holding out for a few more thousand may mean no more offers and having to resort to paying both sides of the broker commission after all.

Having to maintain your home in showable condition at a moments notice for weeks or months is stressful and hard work. Do your homework and start out with a good plan so you can realize the savings while minimizing the stress.

Oh, and about all that paperwork at closing, 95% is for the buyer and the company that gave them the mortgage. You're mainly there to pickup a check once the buyer is done signing everything in that 4" high stack of papers.

kjpliny 02-04-2013 02:00 PM

I sold my house this summer without an agent, using zillow.com. This is by far the most popular and useful free tool you can use. I did offer 2% to the buyer agents, but I built it into the final agreed price so basically the buyer was paying their own agent 2%. The house sold to the first person to see it and it was not even listed on the MLS. We did live in a desireable neighborhood and the house was totally updated except for one bath. Key is to price it right...not too high.

Katsmeow 02-04-2013 02:13 PM

If you want to sell a house FSBO you really need to find a flat fee broker who can list the house on MLS. Without MLS exposure your chances of selling are much less. Could happen, but not that easy.

The other factor is to decide if you will offer a commission to buyer's agents. Typically the buyer's agent gets 1/2 the commission that the seller pays. So - in my area 6% commission is standard - you would need to offer 3% to buyer's agents. You don't have to do that, of course, but then don't expect buyer's agent to show your home to buyers. Many buyers use an agent.

Also, remember that most buyers looking at FSBO's figure they will be the ones to benefit from your not having to pay a commission. They expect to pay less for an FSBO.

Another thing is that the reputation of most FSBO sellers and what I've seen when I've been a buyer is that they overprice their house. They take a house that comps would say is worth $300,000 and ask $350,000 for it and wonder why no one is interested....

I am not opposed to FSBO if you really understand how it works, know a lot about real estate, and are realistic. If you do want to look into it, my favorite forum for home selling/buying is gardenweb and a lot of FSBO's post there:

Buying and Selling Homes Forum - GardenWeb

palomalou 02-05-2013 09:08 AM

We have only sold with an agent. One house I think she way overpriced--we ended up taking 18K less than she had priced, after she did two reductions. The other she called at 8 pm with a client. In my robe I grabbed all the animals, shoved them in the car, and drove to the end of the street and waited. Those people, the first lookers, bought that house.
I think a good agent is worth the price. But I wonder how many good agents there are out there when I look at the atrocious grammar and spelling errors in listings.

tryan 02-05-2013 12:41 PM

What COUNTRY has 9-10% realtor fees .... I pay 4-5%. Well worth it given that most of what I have first time buyer territory . Difficult to know all the programs and ever changing qualifications.

haha 02-05-2013 01:25 PM

Quote:

Originally Posted by tryan (Post 1280256)
What COUNTRY has 9-10% realtor fees .... I pay 4-5%. Well worth it given that most of what I have first time buyer territory . Difficult to know all the programs and ever changing qualifications.

Ryan, is this standard in the towns where you operate, or a negotiated rate since you are a volume customer?


Ha

tryan 02-06-2013 08:03 AM

Negotiated ... also with the same realtor 20+ years. The last one I sold - last year - was 5% because a buyer broker was involved (she insisted on 2.5%). When the market was hot (2004-2006) my realtor could sell within the office and would take only 4%.

A friend did a FSBO. Lost 2 first time home buyers to "cold feet". He knew he needed a realtor. So he screened several by telling them 2% was the MOST he'ld pay in commision. The house would sell itself (he reasoned) ... he just needed access to the MLS. One realtor did accept the 2% and the house sold at his price.

Amethyst 02-06-2013 10:24 AM

With respect to No. 3, you will hear the same criticisms via the real estate agent (is it really worth money not to hear them first-hand from nose-wrinkling buyers?), and will still have to do whatever the buyers expect you to do, so for me, it's a non-issue.

Amethyst

FSBO process takes a lot of legwork, offers no guarantees.
Mispricing home is common mistake that stalls sales. [I'd bet this is all too common]
Thick skin necessary to handle criticism of home

haha 02-06-2013 12:28 PM

Quote:

Originally Posted by tryan (Post 1280583)
Negotiated ... also with the same realtor 20+ years. The last one I sold - last year - was 5% because a buyer broker was involved (she insisted on 2.5%). When the market was hot (2004-2006) my realtor could sell within the office and would take only 4%.

A friend did a FSBO. Lost 2 first time home buyers to "cold feet". He knew he needed a realtor. So he screened several by telling them 2% was the MOST he'ld pay in commision. The house would sell itself (he reasoned) ... he just needed access to the MLS. One realtor did accept the 2% and the house sold at his price.

Thanks Ryan.

Ha


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