For Sale By Owner

We provide real estate services to buyers and sellers in Pennsylvania (Berks County, Chester County, Delaware County, Montgomery County, Philadelphia, Drexel Hill, Haverford Township, Havertown and Upper Darby) as well as in New Jersey (Brigantine, Atlantic City, Ocean City, Camden County and Gloucester County).

Here's a question many homeowners ask:  If I sell my house myself, I will save thousands of dollars, right?  Maybe not!  Many homeowners believe that to maximize profit on a home sale, they should sell it themselves.  They feel that by selling on their own, they will save money by avoiding the real estate brokerage fee.

Although about 20% of all homes "for sale" last year were by the owners, only about 13% actually "sold" by owners.  In addition, over half of those who did sell their home by themselves said they were not sure they saved any money and would definitely use an agent the next time they bought or sold.  Why were so many people unhappy with the results they achieved by selling their own home?

Many FSBO’s explain that the time, paperwork, liability, and everyday inconveniences involved were not worth the amount of money they saved in commissions.  For others, the amount of profit was disappointing.  By the time they figured the amount of additional fees paid to outside consultants, inspectors, appraisers, title, lawyers, advertising and marketing cost, they would have been better off having paid the broker’s fee.  Note, too, that Flat Fee Brokers charge you a fee upfront whether your sell your home or not; with Full Service Brokers, it does not cost you a penny because no fee accrues until your home sells.

FACT: Over the past years, marketing and selling a home has become much more complicated. Even though there are more homes being sold over all, the percentage of homes sold by-owners has fallen. This is specially true during the buyer's market.

Selling a home requires an in-depth and detailed understanding of the real estate market, finding the best qualified motivated buyers, and many other steps that bring about a successful sale.  If the property is priced too high, it will sit in the market for a long time, and it will develop a reputation as being a problem property.  If the property is priced too low, you could lose a great amount of money.  Some For-Sale-By-Owners discovered that they lost money as a result of poor marketing or wrong decisions.

Before you decide to sell your own home, consider the cost, work and liability involved versus hiring a professional.  Some time spent investigating at the beginning can pay off in the end.  Some owners spend so much money trying to sell on their own; then in the end they decide to list their home but they try to cut agents commission by going to discount brokers because they feel bad that they already spent money trying to sell on their own.  The result is making one mistake after another.  You must get yourself a quality agent from the beginning -- and pay them the full price that they deserve.  That's how you receive quality service and top dollar for your home.  Again, this is particularly important in this tough buyer's market.

First, ask if you have the time, energy, know-how, and marketing ability to devote to selling your home.  One of the keys to selling a home effectively is accessibility.  Many homes sit on the market because the owner is unavailable to show the property when the buyer wishes to see it.  In fact, many of them refuse to answer their phones or they screen their calls because they are avoiding phone calls from real estate agents, which is where more of the phone calls are coming from instead of from prospective buyers.  This makes it frustrating for buyers because buyers are impatient and usually want instant response.

Next, are you prepared to deal with buyers who perceive For-Sale-By-Owners as targets for low offers and an opportunity to save money themselves?  One of the great challenges of selling your own home is screening unqualified buyers and bargain-hunting homebuyers.  Settling for a low bid is almost always worse than paying a sales commission.

Are you prepared and knowledgeable to offer information about financing?  Are you willing to finance a buyer?  It is critical to have all the necessary information that a buyer needs, and the topic of finances is certain to come up.  A professional real estate agent will have a team of lenders and title reps for you and your buyer to use.  Do you have that luxury when selling your home on your own?

There are three primary reasons why homeowners consider selling on their own!

1. Hopes of saving the commission.

2. They did not know a good agent.

3. They can't afford to pay the commission because of high mortgage loan balance to payoff.  Regarding this, have you heard of "Short Sale?"  There is a way to sell your home at a price that is less than your loan payoff amount.  If you qualify, the lender ends up paying our fees.  For more details, go to:  www.ShortSaleSecretRevealed.com.  This is a better solution than overpricing your home that ends up not being sold.

FACT: REALTORS will generally sell houses for 5-8% more than owners themselves.

WHY SELLING BY-OWNER IS DIFFICULT:  You only have four ways to attract buyers.

1. Classified advertising

2. Open House

3. For-Sale-Signs

4. Internet

You must give the address.  Buyers can drive by without seeing the inside. For prospective buyers that preview your house, how do you plan to obtain their names and phone numbers?  How do you plan to follow up with them?  What will their impression of you be when you call them?  How will calling them affect your negotiating position?  When agents show homes, do you know that buyers are affected when homeowner is present?  They usually prefer to see the home privately and discuss the features of the home with their partner.  How then could you show your home without you being there?  You would not allow anyone go around your house unattended either, would you?

You have but one property to show.  We as REALTORS have many homes to show and can match our buyers to our properties.  Exposing your home to more buyers is the way to get the most money for your home.

Do you fully understand all the legal steps in selling a home?  Many home sales fail due to incomplete paperwork, lack of inspections or not meeting your State Disclosure Laws that owners are required to make when selling on their own.  Are you completely knowledgeable on all of these requirements?  If not, it would be very wise to select a real estate professional.

Can you mediate disputes with buyers?  Ask yourself if you possess the legal knowledge to work through disputes on any or all of the contracts necessary when selling a home, which puts the owner in an extreme position of liability.  Again, this could be the difference in getting your home sold or having it sit on the market month after month.  This is the reason why even large corporations employ the services of a negotiator to be the middle man who is devoid of emotion.

Are you familiar with the best inspectors and escrow companies?  Randomly selecting companies can be disastrous.  Disreputable or low-quality companies can slow, derail or even halt completely the sale of your home.  A trained real estate professional will know which companies can be trusted to keep the sale of your home on track.

WHERE DO THE BEST BUYERS COME FROM?

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

• 18% come from our company’s for sale signs

• 18% are referred by our relocation service

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

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

• 2% buy a property advertised in the newspaper

• 3% bought for a combination of reasons

SECRET REVEALED:  I will share with you the well kept secret in the real estate industry.  Very few buyers buy as a result of an open house or newspaper ad.  This is a very common misperception among sellers -- whether For Sale By Owner, or not.  They frequently ask the question, if that were the case why are real estate companies doing it?  Here is the answer to that well kept secret:  It is an excellent source of buyer and seller leads for agents.  Yes, it is good for the agents, but it generally does not sell your home.  Agents will try to conceal that from you because that is their best source or getting leads -- especially for new agents.  Instead of telling the truth about its effectiveness, real estate companies even promote that they do plenty of advertising and open houses.  And sellers generally buy it!  Some sellers are now catching on about the ineffectiveness of open houses; but still very few realize the ineffectiveness of advertising.  Well, now you know it, too.

Perhaps you’ve considered listing with a discount broker.  But are you any better off?

Did you know that offering a full commission is part of selling your house for “TOP DOLLAR?”  Discount brokers promise the same services as other brokers, but do they help you to achieve your goal of selling your house for TOP DOLLAR?

FACT:    Sales associates often refuse to show  houses offering reduced commissions, which drive your sales price down.  This is specially true today that there are plenty of competing homes available to show.

FACT:    Homes listed by Discount Brokers normally stay on the market longer and sell at a lower price. You get lower net proceeds.

FACT:    If the buyer knows the commission is discounted, he/she feels he/she has more leverage to negotiate a lower price. You lose money once again because they try to get the very thing you are trying to save!

FACT:   Could you expect an agent who discount their commission to negotiate hard for you when they can't even negotiate their own commission?  Just think about it.

Offering a full commission assures more showings, a faster sale and a higher price, which will net you more money.


Choosing your Agent wisely. Any agent will show enthusiasm and will want to list your house for sale but choose your agent based upon:

1. Experience at listing and marketing houses for sale.

2. Ability to use technology to market your house world wide to buyers 24/7.

3. Reviewing with you a comprehensive Marketing Analysis of home sales in your area.

4. Ability to offer a written detailed MARKETING PLAN that will get your house sold at the highest possible price.

Working with a full-time professional real estate agent is a must.  Choose your agent by asking questions of him or her.  Find out how knowledgeable they are about houses currently for sale in your price range and also of houses that have recently sold. 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 get your house sold quickly at TOP DOLLAR and help you find a new home.

To receive your FREE copy of Homebuyer's Handbook or Homeseller's Handbook, click here.
 

Last modified:  05/14/2008