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| Sell Your Own House--We Did It! |
| by: James Rothaar |
| We recently listed our house for sale without using a real estate agent to assist us. Instead we hired an attorney to process the paperwork and to coordinate the transfer of the property from us to the new owner. We also contracted a limited-services real-estate company to list our house in the multiple-listing service that is used by real-estate professionals. Although, we are not using a real-estate agent to represent us, we are cooperating with real-estate agents who bring prospective buyers to us, meaning that we will pay a commission if their client buys our house. However, by doing this, we are only paying one-half the usual commission fee that is generally paid by sellers. The industry standard commission is six percent. By eliminating (great word) a real-estate agent to represent us, the maximum commission we would pay is three percent of the selling price. Costs To list our house on the multiple-listing service, which only Realtors® can use to list properties, we paid a flat fee to a limited-service, real-estate company. Specifically, they put our property on their \"exclusive\" list. There are other types of listing services, but since most buyers use Realtors to help them find houses, this is the best way to go--at least today. We also hired an attorney at flat fee to ensure the transaction proceeds smoothly once a deal is struck. Saving $30 for every $1,000 of the selling price, or $3,000 per every $100,000, is a substantial savings. Before making this decision, we asked ourselves, what are we getting in return for paying a real-estate agent to list our property for us? Other Services Aside from listing the house in the National Association of Realtors® MLS (multi-listing service) and letting you know when other real estate agents want to show your house to their clients, the listing real estate agent really does nothing that directly leads to your house being sold. However, they claim to do so and still charge a hefty commission. The buyer\'s agent does all the work. A buyer\'s agent makes appointments and then brings clients to view properties. The buyer\'s agent also helps clients submit a purchase offer for a property and, if accepted, assists clients with completing the paperwork. Once an offer is submitted to a property owner and deemed acceptable, the listing real estate agent usually recommends a title (or settlement) company to complete the transaction. The real estate agent also assists you with the paperwork. This may be helpful but an attorney does do the same services for a flat fee. Most attorneys who specialize in real-estate transactions have direct ties to title companies. Many attorneys who specialize in real estate also own title companies. So, you have the option of receiving the info directly from the source, the title company, or secondhand from a real-estate agent. It is up to you. Would you rather receive legal advice from a legal specialist or a salesperson who passed one state exam? I am going with the attorney. Establishing a Selling Price Real-estate agents say that they will conduct a market analysis for you to determine the correct selling price for houses. Without a real-estate agent\'s assistance, how would a seller know what is the correct price to sell their house? Guess what? Sales of properties are published weekly in most newspapers. These listings are also listed by city or ZIP codes. Real-estate agents look at the most recent transactions in your area that are similar to your dwelling. If you can read, you can do this too. California\'s Los Angeles Times even offers an analysis of the average price per square foot by ZIP code. If your property is unique or so remote that there are no comparable sales, do what banks do before giving a prospective buyer a loan, hire an appraiser. Appraisal fees generally range from $300 to $500. If you are stuck, this is what you do. But it is still cheaper than having a real estate agent tell you what to do. Marketing a House This must be the area where listing real-estate agents help home sellers, right? A real-estate agent may tell you to keep your place very clean and eliminate clutter. But if you are seriously interested in selling your house, this is where your proverbial inch of common sense would come in handy. Additionally, listing real estate agents may take or assign a photographer to take pictures of your house and then write an ad for you. Here are two chores that are not worth thousands of dollars to assign to a salesperson. With a digital camera, you can snap your own pictures. If you cannot write well, you can hire a writer to pen an ad for you. There are numerous available samples. There are also a lot of terribly written ads by real estate agents. Other types of sales professionals don\'t write ads, why do you think real estate sales professionals are different. Read some of their work. When these chores are done, a listing real estate agent waits for other real estate agents, buyers\' agents, to sell the house. But they must do something substantial to collect their commission, right? How could they have such an insignificant role and collect a substantial portion of the commission paid by the seller? A Realtor Do you know the difference between a Realtor and a real-estate agent or broker? The word \"Realtor\" is a registered mark by the National Association of Realtors (NAR). That is why it is capitalized. Real estate agents and brokers who belong to the NAR are called Realtors. They also pay yearly dues to be card-carrying members. Ultimately, Ebay® or some other organization is going to have a database of houses for sale equal to the NAR\'s listing. When this occurs, the NAR\'s days of monopolizing the residential real-estate industry will end. The NAR does own Homestore.com and Realtor.com. They may view this as way to retain or prolong their monopoly status of the industry. But it will not last forever. It never does. The Aftermath It is easy to bash real estate agents and assert that they don\'t really do much. Skeptics may ask for proof. As I previously stated, we listed our house and did not use a listing- or selling-real estate agent. After having our house on the market for less than a month, during the holiday season, we accepted an offer submitted by a buyer, who was represented by a real-estate professional, which amounted to 98.6 percent of our original asking price. There truly is a first time for everything. You can do this yourself. |
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