The Real Deal On For Sale By Owner
Have you thought about trying to sell by yourself?
Pros to Selling a Home For Sale By Owner
1. You may make more money from the sale.
Saving a commission is in fact, the biggest reason why homeowners attempt to sell for sale by owner.
The trick, of course, is making the sale without a real estate agent a reality. This is easier said than done. According to The National Association of Realtors, over ninety percent of all for sale by owners fail and end up hiring a real estate agent.
2. You have complete control over the sale.
When you do it yourself, you are in complete control of the sales process. You do not have to listen to anyone’s opinions about how you will market the home, how you will price it, how you negotiate, how you prepare the home for sale or any other decisions. It’s all up to you. There is, of course, good and bad with this. While you are your own boss, you’re losing the valuable counseling and expertise of a potential professional.
3. You can devote your full attention to the sale of your home.
A real estate agent – if he or she is worth hiring – is going to have other clients besides you. That means that you will not be the only concern of the agent. In contrast, when you sell your own home, you can devote all your available time and energy to the sale. Ideally, you have lots of free time to market the home extensively, show at any time of the day and well into the evening, and be available to talk to buyers any time they might call.
4. Additional thoughts on selling for sale by owner.
The one instance where you can dramatically increase the odds of selling a home for sale by owner is when you are either located on a busy road or are located in a neighborhood where there are other homes listed by a real estate agent.
Cons to Selling a Home For Sale By Owner
1. There may not be as much financial benefit as you imagine.
While you will not have to pay a real estate agent for helping you sell, you are not likely to fetch as high a price for your home as you would if you worked with a professional. Price and marketing are key items to selling a home at the best price possible to the right buyer. An established and respected real estate agent knows how to market your property to the right buyers, price it competitively and negotiate based on the hard facts about your home.
2. Marketing a home is not easy – especially without an established network.
You can list your home online without much effort. But so can everyone else. Good marketing ensures that your listing is noticed, and noticed by buyers that are a good fit for what you have to offer. Sure, an agent will list your home online. But he or she will also get the word out across a network of agents working for buyers in your area.
3. Selling a home is hard work.
If you want to do a decent job of selling your home, you are going to need to devote a considerable amount of time to the sale. Your home needs to be inspected, repaired as necessary (but only repairs that will make for a better sale), photographed, filmed, listed, shown and more. When you do get interested buyers, you will need to be available to answer their phone calls, to show the home when they are available and you will need to negotiate a good price.
4. For sale by owner websites aren’t that effective.
When selling your own home, you are not able to list it in the MLS, where most of potential buyers are looking. Therefore, you can only list it in for sale by owner sites or non-reliable sites that don’t get as much traffic and not as much opportunity to show and get it sold.
5. Even with your full attention, you will struggle to replace a good real estate agent.
You may have all the free time in the world, and you may be ready to devote yourself fully to selling your home. Unfortunately, you still do not have the expertise in contracts, title documents, the overall process, etc.
6. You need to qualify the buyer.
If you are lucky enough to find a buyer on your own it’s going to be imperative to make sure they are actually qualified to buy. One of the problems with selling by owner is not having any skills in determining a buyer’s qualifications, if their lender is reputable, and if they will actually make it to the closing table.
7. You need to be careful to ensure your safety.
Inviting strangers into your home repeatedly carries risks, just as putting up personal information on the internet puts you at risk. Real estate agents have a process for ensuring both their own safety and the safety of their clients, but you will be on your own when working with the public.
8. You need to do your research and ensure you are legal.
Each area has its own laws and regulations related to selling a home. You need to read up on what will be required of you as a seller, and you need to prepare all of the necessary paperwork for making a real estate transaction. There are a lot of contracts, disclosures, etc. that are needed so you will need to know where to get them and how to fill them out.
9. You will be a target for bargain shoppers.
For sale by owner attracts certain buyers, those looking for a good deal. They assume you are willing to sell for less because you do not have to pay a real estate agent, so you will need to be prepared for dealing with such buyers.
10. You may want to consult a real estate agent or appraiser about pricing your home.
Even if you do not hire a real estate agent for the full sales process, you can still benefit from talking to a professional about pricing your home and compensating them for their time helping you. The price you set for your home will have a significant effect on the results you get.
11.) At the very least offer to pay a buyer’s agent who procures a buyer.
You can still save money by selling as a for sale by owner. Instead of paying a full commission which can typically run anywhere from 6-7%, offer to pay just the buyers agent for procuring a buyer. This will save you half a commission and could end up getting your home sold much quicker!
Top Reasons Why For Sale By Owners Fail to Reach Their Goals
The list price of the home was wrong from the start.
Not making the home accessible when the buyers schedule dictates.
The home was not prepared properly to sell. This can include fixing items that should have been repaired as well as knowing how to stage a home properly.
The home was not marketed properly including presentation, photography, and internet exposure.
Not knowing how to properly qualify a buyer to ensure they can get a mortgage.
Not knowing how to negotiate home inspection repair requests.
Being stubborn enough not to offer a buyers agent a commission if they bring a buyer.
These are the biggest reasons why for sale by owners fail. If you are going to do it, make sure you pay attention to these things to increase your chances of success! As you can see, before selling for sale by owner, weighing the pros and cons is a wise move.