So you’ve decided to sell your house. There are many things to do now, and one of them is to decide if you are going to use a real estate agent or go the “For Sale By Owner” route to sell your house.
Naturally, the most attractive thing about selling your house without an agent or broker is that you save the commission you would normally pay to the agent. This amount can vary, but often runs around 6% of the price at which you sell your house. With a $100,000 house, that’s $6,000! In your area of the country the average real estate agent commission may be slightly above or below this amount. Also, depending on the market, you may find an agent who is willing to negotiate a lower commission to sell your house.
What Does The Real Estate Agent Do To Sell Your House That You Can’t Do With “For Sale By Owner”?
So what does he do for his commission? Plenty. In addition to trying to sell your house to potential buyers, he also advertises it to other agents. This one fact alone is what usually makes the sale. He lists it in the Multiple Listing Service, and often spends time and money specifically to market your home to other agents.
What’s The Multiple Listing Service? How Can It Help To Sell Your House?
Most agents belong to the Multiple Listing Service, and they find houses for their buyers through this service. Your agent will list your house in this database, along with a detailed description. Here’s a common scenario of how the Multiple Listing Service works to sell your house:
A prospective buyer calls an agent on a house he may have advertised in the paper. The agent sits down with the person looking to buy, and asks him what all he is looking for in a house. They discuss price range, what they want in a house, what area of town they want to live in, etc. Then the agent consults the Multiple Listing Service to find houses which fit the home-seeker’s interests. The original house which the prospect called on may or may not be the one he buys. In fact, according to RealEstateABC.com only about 10% of “For Sale By Owner” homes sell successfully, and this is one reason why.
What does this mean to you?
When an agent lists your house in the Multiple Listing Service, all the agents in your city are now trying to sell your house. If you decide to sell it “For Sale By Owner”, you may not be able to list it in the Multiple Listing Service.
So, when selling your house “For Sale By Owner”, you need to be able to find prospects to buy it on your own. Every agent in the city will not be helping you to sell it. And you need to be able to catch one of those small percentage of people who buy the same house they called on from an ad.
Where can you find prospects when your house is “For Sale By Owner”?
Lots of places…
Your Job — Many people find a new house through someone they know at their work. Also, if you work for a company with multiple locations, they may be moving new employees into your area who are looking to buy a house. Depending on what business you are in, you may also have business customers who may be interested in buying a house.
Your Family — Perhaps a family member would like your house. Let them all know you are selling it.
Your Friends — Let them all know. Even if they don’t want your house, they may have friends or relatives who are looking for a house just like yours.
Newspapers — Advertise in every paper for your area, even the small community papers.
Websites — There are now “For Sale By Owner” websites all over the Net. Do a search for some with listings in your area, and list your home. The most popular “For Sale By Owner” website is ForSaleByOwner.com. They offer many benefits to help you sell your house, along with listing it for you!
Your Neighborhood — Print up flyers and distribute them to all of your neighbors. They may be looking to switch houses, or have friends or relatives who may be interested.
“For Sale By Owner” — Some Other Things To Consider
Lower Offers When Your House Is “For Sale By Owner”
When you want to sell your house the “For Sale By Owner” way, you may have many people simply cut off the typical agent commission in their offer to buy. They know that you do not have to pay an agent, so they lower their offer. If you accept an offer such as this, then all your hard work and effort does not save you anything at all! So sharpen your negotiating skills to sell your house at the best price!
“For Sale By Owner” — Extra Legal Costs
“For Sale By Owner” also means that you will probably need to hire a real estate attorney. You’ll need to consult with him about your legal responsibilities, and to provide the proper paperwork. If you are using an agent, he can usually guide you through the proper steps without additional charges. So to whatever you save in agent commission, you need to remember to add back in these attorney fees to see your real savings.
“For Sale By Owner” May Take Longer
Since you are the only one promoting, it may take longer to sell your house because there are less people looking at it.
So is “For Sale By Owner” right for you? In making your decision, be sure to take the above circumstances into account. Do you have the time to sell your house? Do you have up-front money for advertising and for an attorney? Do you have the negotiating skills to make a successful sale? If you answered, “Yes” to these questions, then “For Sale By Owner” may get you an extra few thousand dollars when you sell your house!