We are in the process of getting a 2nd home ready for sale. Haven’t engaged an agent yet. A neighbor introduced us to their friend who is willing to make us an offer on a private sale. Obviously we save ~$35k on realtor fees, splitting that with the buyer. The buyer is willing to pay cash, and have a quick closing.
Do we just need a real estate attorney to handle our end? What’s a reasonable fee?
IMO, we are willing to trade the upside of potential offers over asking for the certainty of a quick sale. Any other thoughts?
IMO, we are willing to trade the upside of potential offers over asking for the certainty of a quick sale. Any other thoughts?
Make sure you have really researched what the property is likely to sell for.
Saving $35k on a $580k sale is not better than if you had sold it for $650k, paid $39k to realtors, and walked away with $611k instead of $580k.
A RE attorney can probably handle the paperwork part. And probably for a straight $/hour rate.
I wouldn’t expect them to do anything for you as far as negotiation or helping you determine an appropriate sales price.
The buyer is willing to pay cash, and have a quick closing.
Has the buyer provided proof of funds? Has the buyer actually made a written offer?
If the answer to either of these is ‘no’ then you may not actually get a quick closing.
And even if the answer to both of those is ‘yes’, I would ask what type of contingencies are in the offer - because if the buyer wants to do an inspection, or has any contingencies other than you being required to provide clear title, there’s a pretty good chance that he’s not actually going to pay the price he offered you.
I would also echo the question about how you know if you’ve really priced it correctly, especially if you haven’t even talked to a realtor about pricing yet, or gotten a (very) recent appraisal. Have you looked at recent comps?
A neighbor of mine just relisted with a flat rate $2,250 do nothing agent. He had it listed 1 year ago and even in this insane market that IMO we are beginning to exit, or at least moderate, it did not sell. We are in a super hot neighborhood, and when we bought pre-covid, our house sold in a week with 3 back up contracts waiting for ours to fall through.
His property did indeed go under contract this time, and in the first week it was listed. It helps that he is easily priced $250K under market value. It takes considerable amount of effort to pull together comps in the right way, and I will be the first to admit that not all realtors know how to do it properly.
Even if you are leaning towards FSBO, you should interview 3 agents to get an idea of what they can do for you and where they view your home being with regard to today’s market.
I recently sold a rental and almost went FSBO. I was a Realtor in another state and have helped others sell their homes, so I was confident about being able to sell FSBO. I still interviewed agents and one convinced me to list at a higher price than I would have done, with her market knowledge and professional reputation being what got the buyer’s agent to believe it was time for that neighborhood to see prices it had never seen before. We were the first home in the neighborhood for over $500K and a month later, there were 3 more. She broke the resistance to higher prices in an area that had previously been a screaming value, (which is why we bought there.) She likely paid her own commission this way, holding our emotions in check when the home inspection tactics of the buyers got unreal and we were tempted to find a way to terminate the deal. A month after closing, a tree fell on the house we had just sold. I am so glad she held our deal together!
IP,
seconding AJ’s suggestion to get proof of funding for the “cash” deal, and further putting forward the opinion that if you didn’t know to do that, you should not be doing FSBO
Make sure you have really researched what the property is likely to sell for. Saving $35k on a $580k sale is not better than if you had sold it for $650k, paid $39k to realtors, and walked away with $611k instead of $580k.
That happened with us, several years ago. We had the same model house as our neighbor across the street. They had a full basement and a better location but we had only a half basement. They sold theirs by owner. A few of months later we sold our with a realtor. After the 4% commission, we netted much more than they did.
They got $174K (for a better house remember) and we got $215K. Minus 8.6K commission = $206K
The recommendation to use a real estate agent is overwhelming. It would be stupid for me to ignore this. Thanks for all the advice. I’ve already contacted an agent.
Be aware - if/when you end up signing with an agent, you can exclude the private buyer from the contract. That way, if the private buyer buys the property anyway, you can save on part/all of the commission.
Also, I would suggest that unless you already had a trusted relationship with the agent you contacted, you should interview more than one agent.
Also, I would suggest that unless you already had a trusted relationship with the agent you contacted, you should interview more than one agent.
Please do this! My recently sold property had 3 estimates of sales price from 3 different Realtors. The first one was an agent I had used to buy 2 properties and whom I feel to be an excellent professional. She had the high estimate of $550K, sending me a ton of comps and the analysis of those comps. A friend encouraged me highly to use their friend and Realtor. He did almost no work and came in at $425K. His comps were terrible, and it was obvious to me that he was not all that familiar with our neighborhood. But I used to be a Realtor and know how this is done properly. If the agent starts out the process with “You paid this…your tax assessment is this…”, run. those are irrelevant to how much people are willing to pay for your home in today’s market. The third estimate was $525K. We sold the property with the agent we had worked with, closing at $535K with no seller concessions.
I cringe at the idea of someone not knowing how to price the sale of a home taking their friend’s word for how great their Realtor is and going with that low baller! GET MULTIPLE SETS OF EYES ON THE PROPERTY.
Having never worked with an agent before, I have no idea what to look for. Are there specific things I need to look for? Or red flags that I should avoid?
Having never worked with an agent before, I have no idea what to look for. Are there specific things I need to look for? Or red flags that I should avoid?
I would look for agents who have a few listings and/or recent sales in your area - they are probably the ones who are most familiar with your neighborhood. Have them explain what they would price your house at, why they would price it that way, what the strategy for marketing/selling will be, and any improvements/updates/staging they would suggest. They should also be able to give you information on the last several sales of their listings - what the original list price was, what it sold for, any concessions that were required and how long it took to sell. (At least some of that information you should be able to confirm on websites like Zillow.com, Realtor.com and/or Redfin.com and, if you live in a state where prices are disclosed, at your county’s website. Confirm it.) I would also look for someone who has been in the business since at least 2006 or so - so they have had experience in both up and down markets.
Another vote for a realtor here. After taking care of my father, cleaning out and selling his house, taking care of the estate and buying my retirement home, the idea of deciding what to fix and how to price my own house exhausted me.
I used a realtor who had knowledge about my type of house and neighborhood (older home with character that needs some work, nice neighborhood, suitable for starter home or rental). We decided to order a Certificate of Occupancy (required by my city) to figure out what needed to be fixed before a new buyer could move in. After seeing the list, my realtor knew a general contractor who could do an estimate on what those repairs would cost.
Codes have changed since I originally bought the house and I was going to be required to repair things that passed the certificate of occupancy 15 years ago.
My realtor helped me locate a cash buyer known to have a good local reputation for giving a fair price, fixing houses properly, then selling or renting. We never listed the house. I accepted a little less than I had hoped for, but after seeing how much work they did on the house and the sales price, I know I made the right decision. Good contractors are very difficult to hire right now. Supply chain issues and gas prices have driven up all material costs. I would probably still be paying that mortgage and trying to find reliable contractors. And I didn’t have any of the headaches of deep cleaning and showing the house.