Why People Are Afraid To Buy From You! Many homeowners believe that to maximize their profit on a home sale they should sell it themselves. At first glance, they feel selling a home is simple and why should they pay a broker fees for something they could do themselves? In fact, close to 25% of all the homes sold last year were sold for sale by owner (FSBO).
However, close to half of the FSBO’s said that they would hire a professional next time they sold. Thirty percent said they were unhappy with the results they achieved by choosing FSBO. Why?
Many FSBO’s told us that the time, paperwork and everyday responsibilities involved were not worth the amount of money they saved in commissions. For others, the financial savings were even more disappointing. By the time they figured the amount of fees paid to outside consultants, inspectors, appraisers, title lawyers, escrow and loan officers, marketing, advertising... they would have been better off having paid the broker’s fee which would have included many of these charges up front.
Selling a home requires an intimate understanding of the real estate market. If the property is priced too high, it will sit and develop a reputation for being a problem property. If the property is priced too low, you will cost yourself serious money. Some FSBO’s discovered that the lost money as a result of poor decisions outweighed the commission.
Before you decide to sell FSBO, consider these questions and weigh the answers of assuming the responsibility versus employing a professional. A little time spent investigating up front will pay off tenfold in the end.
Questions To Consider:
Do I have the time, energy, know-how, and ability to devote a full forced effort to sell my home?
One of the keys to selling your home efficiently and profitably is complete accessibility. Many homes have sat on the market much longer than necessary because the owner was unwilling or unavailable to show the property. Realize that a certain amount of hours each day is necessary to sell your home.
Am I prepared to deal with an onslaught of buyers who perceive FSBO’s as targets for low balling?
One of the challenges of selling a home is screening unqualified prospects and dealing with lowballers. It often goes unnoticed... how much time, effort and expertise it requires to spot these people quickly. Settling for a lowball bid is usually worse than paying broker commissions.
Am I offering financing options to the buyer? Am I prepared to answer questions about financing?
One of the keys to selling, whether it’s a home, a car... anything, is to have all the necessary information the prospective buyer needs and to offer them options. Think about the last time you purchased something of value, did you make a decision before you had all your ducks in a row? By offering financing options you give the home buyer the ability to work on their terms and open up the possibilities of selling your home quickly and more profitably. A professional real estate agent will have a complete team, from lenders to title reps for you to utilize...they’ll be at your disposal.
Do I fully understand the legal ramifications and necessary steps required in selling a home?
Many home sales have been lost due to incomplete paperwork, lack of inspections or not meeting your states disclosure laws. Are you completely informed of all the steps necessary to sell real estate? If not, a professional would be a wise choice.
Do I have the capability of handling the legal contracts, agreements and any disputes with buyers before or after the offer is presented?
Ask yourself if you are well versed in legalese and if you are prepared to handle disputes with buyers. To avoid any disputes it is wise to put all negotiations and agreements in writing. Many home sales have been lost due to misinterpretation of what was negotiated.
Have I contacted the necessary professionals....title, inspector (home and pest), attorney, and escrow company?
Are you familiar with top inspectors and escrow companies? Don’t randomly select inspectors, attorneys, and title reps. Like any profession there are inadequate individuals who will slow, delay and possibly even cost you the transaction.
Did You Know?
On the Average, owners NET 3% to 5% less when selling
their own homes.That’s 3% to 5% less then selling through
a Realtor and paying the commission.
The Majority of “for sale by owners” Eventually List with a Realtor.Approximately 83% reach out to a realtor…WHY?Frustration.The owners get frustrated with the process of selling their own property.
Owners Accept Less.
Direct buyers expect and intend to pay less.These buyers are usually comprised of bargain hunters, investors, and buyers with little to no money for a down payment.
Owners Pay for All Advertising
It’s surprisingly easy to spend 1% on advertising.
It Usually Takes Owners Longer to Get a Sale
Resulting in extra Taxes, Interest, Insurance—and most importantly YOUR TIME
Owners Usually Pay Higher Attorney Fees…Even if the Sales Don’t goThrough
When sold through a Realtor – an attorney checks our work.When sold by owner- attorney does the work and bills accordingly.
Advantages of Using a Professional Real Estate Agent:
Will help you net more money
Helps protect your family’s safety
Pays for all advertising, marketing, and Open Houses
Can pre-qualify the buyer financially before showing your home
Will enlist the assistance of all Realtors in your market area to sell your home
Can offer a homeowners’ warranty to reduce risk
Knows how to show a home professionally
Is trained to negotiate, overcome objections & bring parties to agreement
Ensures all critical paperwork, contingencies, and timelines are handled properly
Drawbacks To Consider
You have one property to show…
A Realtor has many properties to show in a marketplace where homes are bought by comparison.
The buyer will not share financial information with you…
A Realtor will bring only financially qualified buyers.
The average owner overprices and may accept a price below value.Over priced homes tend to sit on the the market, losing in value as buyers suspect a problem…
A Realtor will price property to sell at a fair market value.
You’ll receive conflicting advice and suggestions that may leave you feeling baffled…
A Realtor has facts at hand and experience as a professional.
You may make expensive and unnecessary improvements to the property…
A Realtor will advise you on how to spend the least and get the most in return.
The direct buyer will not share likes/dislikes with someone they are negotiating with…
Buyers communicate their feelings more openingly to a Realtor.
You can’t follow-up with the buyer.They’ll think you’re anxious to sell…
Following up is what Realtors do.
It’s difficult for you to be objective in a negotiation with the buyer, which may be extremely counter-productive to entering a contract…
A Realtor is trained to be objective and move the parties toward a win-win conclusion.
You may accept an insincere offer and then spend months in litigation to free your property just to put it back on the market…
A Realtor is experienced in seeing trouble spots and acting quickly in the best interests of their client.