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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
John Adams Presents
LANDLORD SURVIVAL TRAINING
with John Adams
Tuesday, February 28th
Being a landlord can be a rewarding experience. It can also be a difficult one if you don't have the knowledge and understanding of what the process requires.
Few schools offer degrees in property management, so most landlords learn "on-the-job" through acquired knowledge and on-the-job experience, essentially re-inventing the wheel. This is an expensive and depressing way to learn anything.
Whether you're a full-time landlord or just getting ready to purchase your first rental property, whether you are a licensed Georgia real estate professional or an accidental landlord, this seminar will help you improve your property's value, increase your cash flow and decrease your expenses, from attracting (and retaining) good tenants to maintaining your property to understanding your rights and obligations under the law.
For more details and to register click HERE
PROPERTY TAX REDUCTION WORKSHOP
with John Adams
Tuesday, March 27th
One of the significant annual expenses faced by any Georgia property owner is ad valorem property tax. Depending on where you live, it can be as high as three percent of the property's fair market value, and it must be paid year after year after year.
As a result, efforts to minimize this expense are not only worthwhile, they are encouraged by Georgia law. The phrase "ad valorem" means that each property is taxed based only on its value, and no one is required to pay a penny more than the minimum the law demands.
At the Property Tax Reduction Workshop, real estate expert John Adams will review the system he has used for over thirty years to reduce valuations and assessments in Georgia counties and municipalities, saving himself literally hundreds of thousands of dollars over the years.
In this 3 hour information packed seminar, John will teach you how to:
1. Understand the legal process of Property Tax Assessment
2. Meet the newly uniform Tax Deadlines
3. File your own Property Tax Return with a realistic valuation
4. Document your PT-50R with facts to support your case
5. Proactively meet with your Appraiser to reach an agreement
6. Protest your Notice of Assessment in an Intelligent manner
7. Give the Assessor an Opportunity to Save Face
8. Appeal to your Board of Equalization, in person or by mail
9. Make Your Case to the BOE
10. Take Your Case to Superior Court if necessary
If you are not doing all these steps now, you are likely costing yourself hundreds or thousands of dollars a year. If you own just one house, you could easily save over a thousand dollars over the next three years. If you own properties valued collectively over a million dollars, you are literally throwing away your profits year after year.
For more details and to register click HERE
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