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Selling Your Home "By Owner" Can Make Sense, If You Have the Time - 2007-07-07 |
Last week, we talked about why most home sellers are best served by working with a real estate professional. That doesn't mean you have to pay a full traditional commission. But it is a recognition that there's a lot of work to be done between putting up a "for sale" sign and sitting down at the closing table.
The reality is this: most sellers are not willing to take on all the necessary tasks required to complete a successful sale. Nor are they able to attract qualified buyers and keep them interested long enough to encourage a satisfactory offer in the first place. Instead, most sellers need to sell quickly, and time is an important factor.
If that is your situation, you are likely better off working with someone who has been there before and can guide your sale to a smooth closing. However, if your circumstances are different, you might want to consider selling your own home yourself if:
* If you have sold homes yourself in the past and know what it takes to get the job done.
I once sold a home in Dunwoody to a relocating IBM executive. He told me he would be transferred again within five years. I stayed in touch, hoping to get the listing when his next move occurred. Instead, I was disappointed when I saw a "for sale by owner" sign.
He told me that he had six months notice on his move, and that he had sold four of his previous five homes, with considerable dollar savings each time. He already had a real estate attorney standing by to assist if needed, and he had plenty of time to test the waters.
I had to admit, much to my dismay, that he was an experienced seller who stood a reasonable chance of saving more than $20,000 in commission dollars. In his case, the process made sense.
* If you live in a hot neighborhood and are in no hurry to sell.
Smart homeowners keep up with homes that are "on the market" and "sold" in their own neighborhood. And if you've got a pretty good idea what your home might be worth, there is no danger in finding out if you have a built-in buyer in the marketplace.
For all you know, you have a neighbor who simply loves the sight of your house. Perhaps he drives by your house twice each day, and says to himself "If that house ever comes on the market, I'm going to buy it, no matter what it costs!" The only way to know if such a prospective buyer exists is to put up a sign and see for yourself.
Remarkably, I have listed houses for owners at what I believed to be top dollar, then written a full-price contract for the house the next day. This is the kind of sale that a real estate broker dreams about. But the truth is that I didn't find the buyer - the buyer was already there.
* If you don't mind taking on some or all of the work of marketing the house yourself, and have plenty of time to sell.
Thirty years ago, there were full service real estate agencies, and nothing else. Everybody pretty much charged the same commission, which was most often seven percent of the selling price.
Today, things have changed. Full service agencies still have an important role to play, but they are under increasing pressure to justify their commissions. And those commissions are, as often as not, negotiated to reflect the arrangement between the seller and the broker involved.
In addition, there are dozens of so-called "discount brokers" on the scene.
These offices offer a variety of services, ranging from staging your home for maximum visual appeal to holding open houses, if you wish. Most offer to include your home in the local multiple listing service so that other brokers will know it is for sale. Most also include the ministerial function of filling out the contract forms and answering basic questions during negotiations with the buyer.
You may have noticed that in the three above scenarios, I have included the qualifier that "you have plenty of time to sell."
That's because the business of selling real estate "by owner" can take along time. And you probably aren't going to get a full exposure to the largest possible pool of prospects unless and until you find a way to get your home listed in the local multiple listing service.
My advice is to only attempt the "by owner" approach if you have at least six months before you need to have your home sold and closed. That way, if you are successful, you will likely have saved some commission dollars, and most important, your home will be sold and closed.
If, on the other hand, you try it "by owner" and the house doesn't sell, you will still have at least 120 days for a real estate professional to give it everything they've got, with all the marketing tools money can buy.
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Upcoming Events
BUYING FORECLOSURES IN GEORGIA
NEW for 2008: Bank-Owned Home Bonanza
This seminar has been updated and revised for 2008 to reflect the dramatic changes in the Georgia foreclosure marketplace. We are literally facing a flood of foreclosure properties, and there is profit to be made in each and every one of these homes.
Whether you want to build a portfolio of homes for your retirement or you simply want to find a better home for yourself and your family, this program is for YOU.
LAST CHANCE THIS MONTH!!
• Saturday, Oct. 11th, 2:00 P.M. until 5:00 P.M. - Renaissance Waverly Hotel in the Cobb Galleria
This COMPLETELY NEW SEMINAR examines the roots of today's foreclosure meltdown and explains how you can take advantage of this opportunity in your spare time.
Advance Tickets: $69; bring a friend for an additional $30.
Couples share materials.
Detailed information available under the “Seminars” button
This course approved for 3 hours of Continuing Education credit by the Georgia Real Estate Commission.
The Real Estate Investor's Institute will be held at Emory University on
November 22, 23 & 24, 2008. Make plans to attend.
Detailed information is
available under "Seminars."
This course is approved by the Georgia Real Estate Commission for 12
hours of Continuing Education Credit. Agents must bring license number.
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