Andrew And Associates

Six Facts Every
For Sale by Owner
Should Know

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The reason most home owners want to sell their own home is that they will save thousands of dollars, right? Well, let’s carefully look at what research and history tell us. Rather than speculate and hypothesize, let’s examine the facts. Home owners feel that by selling their own home they will save the commission charged by the realtor. Last year, approximately twenty percent of all homes for sale were by the owners. However, only thirteen percent of those homes sold. Over fifty percent of those that did sell were not sure they saved any money. The indicated they would use a realtor in the future. Why would so many people list with a real estate agent in the future?

Homeowners reported many challenges when attempting to sell their own home. These included time, legal issues, paperwork, liability and day to day inconveniences. Still others reported that they were very disappointed with their profit. Many homeowners figured the additional fees they paid to outside consultants, appraisers, inspectors, lawyers, title companies, advertising and marketing cost would have more than been paid by the broker’s commission. They did not realize that many of these fees were paid by the real estate agent.

However, in addition to this, there are several additional facts homeowners must be aware of if they are to successfully sell their home for maximum profit in minimum time.

FACT #1:  Over the past few years, selling a home has become much more complicated. The number of homes actually sold by owners has dropped.

The successful selling of a home requires many skills. You must understand the real estate market. The market is constantly changing. You must be able to find qualified buyers. The buyers must be motivated. This is not a simple task. If you price your home too high, your home will stay on the market longer and runs the risk of not selling. When a home is on the market for a long time, it develops a reputation as a problem home… there must be something wrong. If a home is priced too low, you run the risk of loosing thousands of dollars in profit. Some For Sale by Owners found out they actually lost money because of poor marketing and decision making.

Before you decide to sell your own home, ask yourself a few questions. Do you understand the amount of work involved? We live in a day and time when people say “I’ll see you in court” at the drop of a pin. Do you want to assume that liability?

Do you have the time, energy, knowledge and marketing ability to sell your own home? You must be accessible. That means you must be available to show your home at the buyers convenience, not yours. Buyers do not want to jump through hoops just to look at a home. They want it to be quick, simple and convenient.

Did you know buyers perceive For Sale by Owners as the perfect target for low offers? But that’s not all. As a seller of your own home, you must also know how to screen out unqualified buyers and bargain hunters. If you reduce your asking price, you will almost always receive less money than if you’d paid for the real estate commission.

What do you know about financing? Are you willing to finance a potential buyer? You need to know about lenders, title companies, mortgages, etc. in order to understand what a motivated and qualified buyer looks like.

FACT #2: REALTORS Sell Homes for More than the Owners Themselves

On the average, real estate agents sell homes for 5% to 8% more than homeowners. I have personally seen more than a 14% increase in the final sales price. You don’t want to leave money on the table.

Usually there are two reasons why homeowners want to sell their own home. First, they plan on saving the commission. Second, they really don’t know a good agent. What they don’t realize at that very few homeowners get their asking price. They almost always receive a lower offer.

But there are additional reasons why selling your own home is so difficult. You have only four ways to find buyers. These are classified ads, for sale signs in the yard, open houses and the Internet.

When you advertise, you must give your address. This means buyers can drive by without ever seeing the inside of your home. How do you plan to capture their name, address and phone number? How will you follow up with them?

Fact #3: Where Do The Best Buyers Come From?

40% come from a REALTOR’S company name or salesperson contact.

18% come from recognized real estate for sale signs.

18% are referred by international relocation services.

15% locate a property and/or their agent on the Internet.

4% responded to an open house but purchased a different property.

1% buy a property advertised in the newspaper.

2% bought for a combination of reasons.

Please note: In today’s market, very few buyers buy as a result of an open house or newspaper ad.

You have only one home to show. A professional realtor has many homes to show. He/she can match buyers with properties. That means the buyer is pre-qualified before they ever see your home.

One of the major problems reported by homeowners was the legal paperwork and required state disclosure laws. You must understand all the legal steps required to successfully sell a home. Many sales fail because of incomplete paperwork, inspections and failure to meet state and federal disclosure laws. If you’re not knowledgeable or comfortable with this, you would be well advised to find a good real estate professional to help you.

One of the most critical steps in the sales process is negotiating with the buyers. This requires knowledge of contracts and places you in a position of liability. This can make the difference in selling your home quickly for maximum profit or having your home continue to sit on the market.

Perhaps you’ve considered listing with a discount broker.  Again, you expect to save money on the commission.  Are you any better off?

If you want to maximize your profit, you will offer a full commission. Here’s why. Most discount brokers promise they will provide the same service as other brokers. However, let’s look again at some facts.

FACT#4: Many real estate agents will not show homes that offer reduced commissions. This, in turn, drives down your sales price because you have fewer showings.

FACT#5: Research shows that homes listed by Discount Brokers usually stay on the market longer and they sell for a lower price.  You do not get all the services of a full time professional agent and you end up netting less profit.

FACT#6: Buyers have become very savvy. They know that the commission is discounted. This means you may not have someone helping your negotiate your sale. The buyer feels that he/she has more leverage in negotiating a lower price. Once again, you lose money.

Here’s the bottom line. Offering a full commission insures more people will see your home. It will sell faster and at a higher price. You will normally make more money by working with a full time professional agent.

Choose your Agent wisely. Any agent will get excited about listing your home. However, you need to look at some additional criteria when selecting your agent. Choose your agent based upon

1. Experience at listing and marketing homes.
2. His/her ability to use market your house world wide to buyers 24/7 using current technology.
3. A careful review of a comprehensive Marketing Analysis of home sales in your area.
4. His/her ability to provide you a written detailed 30-Day Marketing Plan.

If you want to sell you home for Top Dollar, work with a full-time professional real estate agent. Select your agent by asking good questions.  Ask about homes currently for sale in your price range and houses that have sold in the past few months. Can your agent recommend a good lender that has the reputation of excellent customer service and low rates to assist your new buyer with financing?  A good listing agent can sell your home for Top Dollar and help you find a new home quickly and efficiently.

Do you have questions or need advice you can count on or just want to discuss this further?

Don’t waste any more time; pick up the phone and call me now!  I’m here to help!

I offer a five star guarantee. I appreciate your business, loyalty, trust and referrals. My goal is to provide the very best counsel and advice to meet your real estate needs. If I can assist you, a relative, friend or co-worker, please give me a call. I look forward to the opportunity to serve you.

For prompt, courteous, professional service, call Larry Andrew: