How to sell your home without an agent
Shannon Lee | Improvement Center Columnist | June 1, 2015
When it comes to major transactions like selling your home, most opt to turn to a real estate agent. In fact, about 90 percent of all homeowners choose to hire a real estate agent to help them sell their home. But for sale by owner is becoming much more popular, and there are a few good reasons why it is worth consideration.
The pros and cons of "For Sale by Owner"
Before you make any choices on whether or not to hire a real estate agent, start by doing some serious homework. Explore Zillow, Trulia, and other home sites to figure out the usual prices in your area, the tax rates, what is available near you, how long homes tend to stay on the market, and more. You can then make a much more informed decision on whether to go it alone or hire someone to help you.
What can you expect when you choose to sell on your own? Here are a few points to ponder:
- For sale by owner means no commission. An agent will always make money on the sale; the going rate is up to six percent in most states. They get paid whether you make a profit or not. Selling on your own keeps that money in your pocket.
- You get to set your own timeline. When you work with an agent, they might have different goals than you do. By selling it on your own, you get to decide how soon to list it, how often to show it, and when it's time to lower the price.
- MLS listings might cost more. Real estate agents use the MLS service to list homes. You can too, but for a sometimes rather steep price.
- You cut out the middle-man. The best agents are very busy agents, with loyalties to dozens of people. By showing your home yourself, you can rest assured that when a potential buyer or buyer's agent calls, you are ready to open the door.
- You have to deal with red tape. Selling a home means a nightmare of paperwork. Without a real estate agent, you will have to do serious research on what is expected of you and when.
- Good connections can help. Real estate agents rely on a huge network of contractors and other home professionals to prepare a property for sale. Selling on your own means you don't have access to that network, and will need to find your own.
Here's how to get started
Have you made the decision to hang out your own For Sale sign? There are a few things you must do before selling your home, and that starts with serious research. By this point you should have already done some digging into what home prices are like in your area, how long homes stay on the market, and the like. But now it's time to look into what is expected of you and how to protect yourself when you do put the home up for sale.
- Start with a home inspection. To eliminate any surprises that might pop up and block a potential sale, get a thorough home inspection before putting your house on the market. This can allow you to perform any necessary fixes or upgrades, and can help put potential buyers at ease.
- Insist on prequalification. Many real estate agents insist that potential buyers show a letter of prequalification, meaning that they are proven to have the funds or financing to purchase a home within a certain price range. Without that prequalification letter, you run the risk of entertaining those who just want to take a look around your place.
- Hire an attorney. Even if you get through that paperwork nightmare just fine, you will still need someone on your side at the closing table. A real estate attorney can spot things you might have missed and offer guidance on points that are confusing.
- Don't get emotional. You are understandably attached to your home, and that can cloud your business sense. If you get emotional about the place and refuse to lower the price, get upset with buyers for suggesting improvements, or disagree with home inspectors, you might not be ready to sell your home on your own.
- Get ready to market. Invest in some serious marketing to get your home noticed. This can include listings in the MLS and other websites, yard signs, information boxes and flyers, magazine advertisements, and much more. Do anything you can to get the word out!
Finally, remember to be patient. Even homes that are listed with a realtor can spend many months on the market before getting any sort of offer. If you haven't had serious interest after six months, step back and reevaluate your price, your marketing plan, and whether you still want to go it alone.
Photo credit to Nam Phan