List It Or Sell It Yourself?

Many investors and some home owners with a do-it-yourself bent believe they can save a couple thousand dollars by selling their house or condo themselves. Some are quite happy with the outcome and others eventually turn to an agent to sell their property. So what does each choice re quire and yield?

For Sale By Owner

As you drive around, you are likely to see those red and white For Sale By Owner signs scattered among the standard signs featuring the face of a smiling realtor. They can be picked up at any blue or orange store. There are even companies that specialize in facilitating the process by supplying signs, flyers and other support materials.

Now that you have your sign and hopefully will start getting calls. Many of these calls are from neophyte realtors looking for listings as they begin their careers. In looking to save realtor commission, you can price the house to benefit from the saving or you can price it a little lower to make the sale easier. Then you can show the place and point the reasons it would be a wise purchase.

Of course, you will get the usual range of looky-loos and investors looking for bargains. If your negotiating technique is primarily lowering your price to accommodate objections, perhaps this is not a good choice for you. You can get some help in this area by getting a book like Never Split the Difference by former FBI hostage negotiator, Chris Voss.

When you find a buyer you can download the legal forms or get them at most office supply stores. Be sure you fill them out properly or they could be worth less than the paper they are printed on. Then take them to an attorney or title company to set up the closing. If you get a deposit (and you should) it is not yours yet. The people doing the closing are usually escrow agents that can hold it until the sale is completed.

I find it unusual to make this recommendation, but if this is your first effort at selling a piece of real estate, I would recommend a good real estate attorney. They will keep you from a multitude of costly missteps along the way That is a real estate attorney, not one who dabbles in real estate while spending most of their time handling wills and divorces.

What Can An Agent Do For You?

In many ways it depends on the agent. As with any profession, there are good ones, there are learners, and there are shysters. If you go this route, don't just pick an name from an advertisement, ask around and talk to the people who have worked with them.

The good ones will know the market and be able to set the price to be competitive so it attracts buyers. They will tell you how to arrange you house to be attractive to buyers. They will list it on the MLS and promote it to other agents. They will handle the paperwork in a legal and professional manner, and follow through with arranging inspections and all the other details that provide for a smooth closing.

For that, you pay them multiple thousands of dollars... and they will probably pay for themselves by getting you more for your property than you would get yourself. But, can you get it cheaper with a discount agent? Remember what I said about good and not-so-good agents. Like most things in life, you get what you pay for.

A good real estate agent can make a lot of money, but don't think they are making it just on you. There are a lot of expenses in doing a good job for their client including a share that goes to the brokerage that provides facilities and services to the agent. There are memberships in national, state and local realtors organizations. They pay for those beautiful signs, the digital lock boxes, advertising, driving people around showing houses. You may only see the buyer they bring you at closing, but you may not know about the one or two dozen prospects they brought through along the way.

Most are hard working people, concentrating on selling your property – they don't get paid unless you do.

How About Investors?

If you've been around a while, you know the paperwork. You know, or should know, the title companies and attorneys, depending on your area, that can do a clean closing and take care of your interests. The question becomes, is handling the sale the best use of your time? Would you be better off looking at and preparing other properties? Only you can answer that question.

If you are looking to sell the place with owner financing, you are working with an entirely different economic reality. Realtors tend to stay away from these things, partly because of comfort level, and partly because there may not be enough there to pay their commission – in which case you have no initial income for your trouble.

These are deals that are generally best handled yourself as they tend to be easy sales since there are many people unable to qualify for a mortgage. Just make sure you do a thorough background check. On these deals, a good title company is worth it's weight in gold. Along with this you would need a cooperative residential mortgage loan originator (RMLO) to put together the paperwork to be sure you don't give someone a free house – it's worth the money. Even though they are gone from congress, Messrs Dodd and Frank are still looking over your shoulder “protecting” the consumer. Mortgage brokers can point you in the right direction if you don't know of any.

There is a lot of money involved in either choice, so you may want to give it a lot of thought.

Show Your House – Sell Your House

If you are trying to sell your house, whether it is your residence or one you rehabbed or inherited, sooner or later it comes time to show the property. After you have the place all polished and shined it's time to start advertising.

Getting the word out

The best advertising techniques is a topic for a whole other time, but we will hit the high points. There are various online options, including Craigslist and various For Sale By Owner sites.

Take some pictures and make up some flyers. You may want to have the pictures made into a short promotional video for your online ads. The flyers you can pass out around to the neighbors – perhaps they will supply your buyer as they help decide who moves in the neighborhood. You can purchase signs at most big box building supply stores. When you do, get the tube or box to hold more flyers and keep them stocked.

Invite them in

When people begin responding to your ads you will need to start showing your house. Here is where videos can be a real time and life saver as it could weed out the buyers not really interested in your property. Whether you are living in the property or not, it is usually best have an open house scheduled for them to come by. Some will not be able to make your time and it's OK to deal with that, however it's best to get them all together at once for them to see others interested in the property. Have a sign in sheet when they come in. Realtors do and so should you. Get their phone number and/or email so you can follow up with them, even if they are not interested in buying. You may learn something to do better next time.

Preparation

Now is the time to get the place super clean. Hire a cleaning person to make the place shine if you have neither the time nor inclination to scrub down everything – especially the kitchen and bathrooms. If you have a cat, you don't notice the litter odor, but visitors probably will. There are sprays available to eliminate that aroma. This is definitely the time to have that extremely honest friend come and walk through your house with you. They will notice things you live with every day. Speaking of aromas, baking cookies, even the ones with dough that comes in a tube make the home feel more homey and can be served to make the visitors feel more like guests. Yes, serve the cookies and let the visitors enjoy them. Try to keep an eye on the offspring that they don't grab them by the handful.

If you have a lot of family pictures, it is good to put them away while you are showing the place – especially if you have children. You want people to start thinking of the house as their place, not that they are buying your home. Beyond that, the less visiting stranger know about your family the better.

Make sure the lawn is cut and trimmed, and the leaves raked if it is that time of year. Pets caged or visiting relatives - and the back yard cleared of “land mines” if you have a dog.

Staying Safe

There are some safety tips if you are showing the place alone. I need to add at this point that many come straight from realtor training as supplied by our local police department. This is not to frighten you but to help make sure you enjoy the sale. It is best that you have your car parked in the street if it is possible so you cannot be blocked in. This is most important when you are alone on the property. When taking people on a tour of the house, direct them into bed and bath rooms along with any enclosed area rather than going in first, then stay by the door. Most people are great, but just be careful and stay safe 

Relax

People usually enjoy looking for a house. Occasionally you will find some that try to be intimidating. Ignore it and enjoy the process yourself. I've met some pretty good people showing houses. When it comes to negotiating the deal – that also is the subject for another day.

For now, know what you believe the place is worth and don't let someone low ball you. The whole process from start to finish is covered in our eBook Sell Your House Like a Pro!!!