I admire anyone who tries to do things on their own. I often take on do-it-yourself projects and many times find that I can do the job better than some professionals. There are however some things I would never attempt to do on my own. Some of those would be anything pertaining to my financial health or my physical well being. Trying to sell your home on your own, can potentially be a risk to both.
Selling a home today as a Real Estate professional requires many disclosures to protect our clients, ourselves and our company from financial liability. Using a professional who understands all the risks and pitfalls should help protect you from liability. Do you have contract paperwork that has been reviewed by an attorney? Do you have the proper disclosures for the buyer? Do you know how to handle a buyer's good faith deposit? If you are using an attorney, will they help with negotiations with the buyer? What if additional negotiations are needed after inspections are completed? Who will coordinate and attend inspections and appraisals? Does your contract allow the buyer's lender to release information to you regarding the progress of the buyer's loan? These are just a few of the concerns I would have if selling without a professional.
Not sure if you agree? Would you trust the advice of Dave Ramsey? He believes it is a good idea to use a professional. Here's what he has to say:
Use a High Quality Real Estate Agent
QUESTION: Jack from Twitter asks what Dave’s opinion is on the sale of real estate: with an agent or for sale by owner? Dave recommends always using a real estate agent.
ANSWER: I would always use an agent, but only a high-quality, high-octane, high-protein real estate agent. I wouldn’t fool with about 80% of the people in the real estate business. I would want to deal with someone in the top 20% of the business, who sells a lot of property and has what’s known as a clue.
When you put the house up for sale by owner, you put a sign in the front yard, and let’s say you’re in an area where the typical real estate commission is 6%. If I knock on your door as a buyer, then what do we get? Why do you think I’m there? I’m there because I like your house, but one of the other reasons I’m there is because I figure I’m going to get a better deal because you’re not paying a real estate commission. I’m trying to save some money because you’re saving on the commission. You’re trying to save some money because you’re saving on the commission. You’re going to negotiate away some of the commission because there’s only one commission there. Both of us—the buyer and the seller—can’t save the commission. It doesn’t work that way.
Many times, a real estate agent will knock on the door and bring you a buyer. Then you would typically pay that person at least the buyer’s half or a 3% commission. Then you’re going to negotiate away part of the other half. In addition to that, it’s tougher to negotiate these deals on your own by half, and you may make a mistake. One tiny mistake in a real estate transaction causes you to lose tons and tons of money—a lot more than a commission.
An agent will put your property in the MLS system. They advertise it. They have a Rolodex full of clients that they’re working. They’re able to expose your property to more people to buy it.
Lots and lots of studies have been done. After all of the adjustments I’ve just covered, you don’t save money by selling the house yourself unless you already have the buyer lined up. If you already have the buyer lined up, you can go down to the title company, draw up a contract, and close the sale. But if you go through a normal marketing cycle and normal processes to find a buyer, you may lose money on an FSBO.
Source Verifcation: http://www.daveramsey.com/index.cfm?event=askdave/&intContentItemId=115484
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How about the owner of For Sale By Owner? Below is a link to his story (also reported by the Wall Street Journal here) :
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Statistics reported every year from the National Association of Realtors also show that using a Realtor can actually make you more money when selling your home. If you're still not convinced, I ask that you think like a buyer for a moment. If you were planning to buy a car, would you think you could get a better deal by buying from a private seller or a dealership? According to Kelley Blue Book I can buy a used Cadillac CTS 4- door sedan from a dealer today for $19,180, but from a private party I should be able to get it for $16,870 - about 12% less...do you think buyers of your home might be thinking they can save money by buying a For Sale by Owner home?
One final but very important thing to keep in mind when trying to sell your home yourself is safety. If you are showing your home on your own, you may want to have a sign in sheet and ask those viewing the home to sign in with their name, address and phone number and you may want to verify their name and address by asking to see their driver's license. Many Real Estate offices ask to make a copy of client's driver's licenses as a safety precaution before showing homes to buyers. While the risk may be small that someone viewing your home could be a danger to you, it is still wise to be cautious.
While I fully support anyone trying to sell their home on their own, and am happy to assist you by providing you with sign in sheets and comparable market analysis', I hope when and if you are ready to list with an agent that you will allow me the opportunity to apply for the job!
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