Why The Latest Trend is to Sell Your House Without a Realtor
The latest trend? Skip the realtor!
2021 has brought some strange things to real estate. First how much power a homeowner has when selling their home including rocketing home prices. Put that together with the fact that there is little to no inventory and surging lumber and building material costs for a new home. When you take this and add it to the fact that homeowners have the tools of the 21st century like instant cash offer buyers and for sale by owner websites - the question becomes...
"Why pay a realtor 6% for a sign in the yard!"
Not Even a Legal Requirement
That's right! Its not required to sell your home and you can handle the transaction yourself. If someone tells you differently or suggests you're incapable of doing it yourself. I mean have you seen some of the real estate agents out there?! If they can do it, you can too. In this guide there are actionable steps you can take. When it comes to law in general, one thing we can confidently say is to always have a closing attorney!
Realtor Fees for a "Sign in the Yard"...
Realtors can be full of promises, but the question is: can they deliver? Fact is that right now with our current market it is almost always a yes. They will almost always deliver on the number they tell you because of dwindling inventory and the power of the sellers market. The thing is... that is your seller's power, not theirs. So why on Earth do these real estate agents act like they are the only ones who can do it? Lets say your house is $300,000, for example, that means you lose out on $18,000 in cash in your pocket. For a few showings you're buying a 2015 Ford F150 (ask me about my brand-used truck purchase!). With the tools of today, you can achieve a similar result and avoid paying an agent when selling your home.
No Effort from Brokerage or Agent
One big problem is you don't really know this person. Even if you have had a few appointments to learn about them, you haven't actually seen them work unless you have sold a home with them before. Its not like going to buy groceries, because you know what the experience will be like! You won't know if your realtor has "rotten produce" like some of those groceries stores to avoid!
Trust in A New Relationship
Can you trust them to remain ethical when representing your interests? The fact is it is quite easy to get licensed as a real estate agent. If they don't have a good track record - or no track record at all it may be good to avoid working with an agent like this.
Trust with Strangers in Your Home
When you have an agent selling your home, they will provide a lockbox code to the buyer's agent, the one representing a potential buyer. They will enter your home without you or your agent and poke around. There have certainly been some interesting situations that have arisen from this practice, but if you sell the home yourself you will be there giving a brief tour.
Closing Can be Too Slow
So you've worked with a real estate agent, they have a couple of offers on the table. Well the thing is you've done all of this and now the home will need to...
Buyers approved for a loan
Loan appraising at that loan amount
Making repairs or concessions
All of these things take time. Time you may or may not have! If you have a home that you are moving in to with a specific date in mind and closing is extended - Sheesh! Other situations include selling inherited houses, selling a home before foreclosure, and countless others. If you don't have time, this may not be an option!
Lack of Cash Offers
If a buyer has to depend on a loan and your home needs to go quickly, the appraisal may not come through properly, or it may need repairs or the buyer may just be straight up denied. Always ask for pre-approval letters from buyers and prioritize cash buyers!
You might quite literally not have the money, time or physical ability to make repairs. Home buying companies like ours fix up our properties ourselves. These repairs can be a major concern when selling on MLS because buyers want a finished product. You will only have homebuyers that are investors, and if that's the case why sell a property to an investor with a 6% realtor fee, when you can sell it for a similar price to home buying companies - we'll get into this later!
Why to Sell a House by Owner
Selling a home by owner can be a good option and one of the most common because you can get the maximum amount for your property.
Maximum offers without any selling agent fees
Could have to pay thousands in repairs
May have to make concessions
Will need to have selling and negotiating skills
Must be able to communicate and treat the home sale like a job
How to Sell a Home For Sale By Owner.
1. Do Your Research and Set a Price
This can be one of the most important parts of a listing. Too high of a price can deter potential buyers and depending on your timeline could leave you without enough time and you will have to sell for much less. On the flip-side you could list at a lower price, and attract more buyers but if your home isn't actually worth much more you could get stuck at that price.
2. Prepare Your Home
Staging makes quite the difference both in the "ease to visualize property as a future home" with a 77% impact on buyers and a 40% higher likelihood to "walk through the home they saw online" according to this NAR report.
Of course, it costs money and if you're not able to spend it, you're better off prioritizing a closing attorney and closing costs.
3. Invest in a Photographer or Your Own Equipment
I mean obviously - right? A professional camera or the professional themselves will make a huge difference. The first impression is huge and most will see your listing online and it is your job to create a good enough photo for them to book a tour with you.
4. Add a For Sale Sign
Ok so you've committed! Its for sale... at least in your head! Now lets get some signage up so its official. You've probably seen the bland plastic 8.5"x11" signage before but it would be best to avoid! It can be extremely simple to create something professional looking using a service like Vistaprint.
5. Publish Local Listings
Next you should be posting your listing onto local websites like Zillow, Craigslist, the community paper or Facebook Marketplace. Be sure to include an enticing description that still explains the details of the property like:
Beds/Bathroom (Example: 3 Beds 1.5 Bath or 3/1.1)
Recent Major Upgrades like a Roof or HVAC System
6. Create an Open House Event
Next you will want to have an initial event where you can bring as many people as you can at once to spark the "fear of missing out" and get a few offers! Make sure the home is clean and staged (if possible) and be ready to answer any questions and use a sales technique like gather, respond, deliver, close.
Gather information about their needs in a new home and their timeline
Respond with the home's benefits related to their needs
Create interest through this technique and motivate them to buy
7. Answer Offers
Its time to answer some offers. Some will be "low-balling" and others will be legit. Its important to understand some of the language when selling your home.
Pro Tip: In a contract some will have in the purchase section that "[Person's Full Name] will reserve the right to assign this contract". When you see this it means they are a wholesale buyer - who concealed this information - and only want to put your home under contract so they can sell the contract with an "assignment fee".
8. Negotiate the Price and Costs into Your Favor
Using the information you found when meeting them and why they are interested in the house, you can use this to stay firm and reduce concessions, but if they have real needs for concessions to close a potential loan or meet an appraisal value you may have to go with it. Be wary of homebuyers that offer a lot with many contingencies, as this is a popular homebuying strategy to reduce the price of a home purchase.
9. Hire a Closing Attorney
Have the title run, your closing attorney and homebuyer all on the same page. You will need someone representing your interests when selling your home so its best to have someone other than your title company working with you.
Potential Strategy: Alternative option to #6-#10... Hire a Brokerage to run an open house, negotiations and answer offers. This can be a good but expensive option if you are out of state!
You can still sell your home without a realtor, and you don't even have to sell it yourself. These 3 options are all similar, but are much different than the surface will show.
Local Home Buyers
Companies like ours, We Buy Houses RVA, LLC, buy their properties locally and in our case that is the Richmond, VA area. Local home buyers have a vested interest in supporting their communities and creating a home that can be filled with memories again, rather than cutting corners. This home buying process is simple, you fill out a form, they call you and then you book an appointment where they will come to your home, evaluate what it is truly worth and give you a cash offer. One of the main benefits is that they are extremely flexible with your timeframe, create properties owned by locals and hire local contractors. They offer everything the corporate conglomerates do, while having a higher purpose than a company's bottom line.
"We Buy Houses" Companies
Now we're into muddier waters where some of these companies will offer you cash for your home without even having seen it! Do you know why they do this? They do this because they don't care what condition its in, and offer based on how much of a disaster it could potentially be. So if your house isn't falling apart - chances are an in person offer from a local home buyer will be much higher!
Companies like Redfin will sell your home online without anyone having met you. I mean talk about a potential deal for buyers! This is putting the sign in the yard for you 2.0 where you don't even meet them!
Bonus tips for selling your house without a realtor...
Create a realistic price
Advertise and promote your listing
Treat this sale like a job - a good offer can make thousands of dollars of a difference
Have patience. Selling without a realtor does take much more time
If you're struggling to sell your home, or you need to sell your home fast, or need a guaranteed cash offer for your house in the greater Richmond, VA area. Call us. We're happy to provide you some resources so you can do it yourself, or help you get a cash offer that you can use as a guarantee and try to beat it through selling it yourself! Click this link to get started.