We had a crazy idea last week. We might sell our house and build a new one. Yes, I know, this is just one week after we almost bought a vacation home.
I’ll be the first to admit, I’m a bit impulsive… ok, I’m a lot impulsive. But don’t worry, once I get an idea in my head, I spend every possible minute analyzing it from every angle to make sure it’s a good idea. So the house isn’t for sale just yet.
Selling Without a Realtor
We’ve always used a realtor in the past, but I’m starting to think we can do the work ourselves. We have our lawyer review all of our contracts anyways, so I’m not worried about that part.
Since I’m home and Scott works part-time, we should have the time to do the legwork. And with the possibility to save up to $40,000 in commissions depending on the route we go, we should probably make the time, right?
We’re considering listing our house either FSBO or on Flat Fee MLS. We’ve noticed a trend in our neighborhood with the Flat Fee MLS listings; the last few houses listed were all done this way.
Before we proceed, I’d love to hear about your experiences selling your house yourself… the good, the bad, and the ugly!
Have you sold your house FSBO or Flat Fee MLS? How did it go?
By the Numbers
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Yes, I have sold the house using the Flat Fee MLS.
There are many pains that the Seller has to take to sell it through this method. Basically, it starts with you defining everything you want to say in the MLS listing page. Second, you have to make some excellent collateral material to do the marketing of your own home/area/features.
Also, all showings are done by the Seller. So, you have to stop your life, stop most ‘smelly cooking’ and always keep the home neat and clean.
Finally, it will take a bit longer to sell in todays’ market unless you undervalue your home. So, you have to do all of the above for a good period of time (check avg lead time to sell homes in your area, and then check the shortest and longest time).
This is above all of the analysis you have to go through to determine the selling price, as well as preparing your home for a sale.
I am missing many things, like prequalifying your buyers, showing the home to nosy neighbors, getting phone calls at all times of day and night, and finally, the negotiations that you would have to enter into with one or more buyers.
I got all kinds of people, but I was determined to sell it myself, and finally got a buyer under the FSBO model, so I even saved the 2.5% I was supposed to pay, since the ‘real buyer’ saw my online FSBO ad and came in!
Hope this helps.
I sold a condo in 2007 using the Select-A-Fee real estate system http://www.selectafee.com/ which is a flat-fee MLS listing service. Excellent experience, highly recommended. They also list on several other online sources and were able to provide a virtual walkthrough at a small additional cost.
This was a condo that I had previously been renting out, so there were no issues with keeping the place clean to show. I left a key to the condo with the Select-A-Fee people and buyers with brokers just picked up the key from there. Buyers without brokers I sent someone to show around.
Total cost including the virtual walkthough was $1000. 2.5% would have been about $6,000. Frankly, I felt so guilty that I tossed them an extra $500 gratis. That has actually worked great because they now give me real estate searches, alerts, research for free and direct deals my way.
I am a former real estate broker, so I know that sometimes more than 50% of deals result in no comission. That is, the house just does not sell – so the listing agent gets nothing. Instead, under this model you pay in advance. They get their money up front which takes the risk away (recognize that the reason that commissions are typically so high is that you are making the real estate agent bear the risk that the property won’t sell.)
Recognize however, that you are still going to have to offer the 2.5% co-op to the buyer’s broker, so you are only looking at a savings of about 2%-ish on the purchase price.
Also, I like this arrangement because I don’t have to worry about the listing agent putting pressure on me to sell (like they do in a regular arrangement because they want their money.)
You have to watch out with a FSBO because sometimes agents won’t show the property to prospective buyers – or may not bother looking as FSBO-only websites – and you really want to get traffic. In my area, most FSBOs seem to be having a rough time. There is plenty of supply, so buyers agents are directing sellers to high-commission properties.
As a real estate agent myself, I’m here to tell you that you absolutely should try the FSBO route before doing anything. It’s easier to do than ever, if you know what you’re doing. The internet is your best friend, and you’d be surprised what you can do with some well placed flyers, and a yard sign that really stands out. If you price your home right, you shouldn’t need anyone to help you sell, least of which for $40,000! Yikes!!!