Do I Really Need a REALTOR® to Sell a House?

Dated: 05/05/2020

Views: 866

Seven Ways to Sell Your Home.

In this day and time there are many ways to sell a house and the method you choose should be guided by your ultimate goal. You might want to sell your house as quickly as possible. You might want to get the most net profit. You might want to do it with the fewest inconveniences. Here’s a list of ways to sell your house, with or without a REALTOR®, that will help you reach YOUR goals.

Traditional Sale with a REALTOR®

This method will get you the most exposure possible AND bring the highest net profit. A REALTOR® will list your home on the MLS and allow it to aggregate to hundreds of real estate websites as well as use advanced online advertising methods, send out targeted direct-mail, conduct open houses and perform pro-active buyer lead generation and follow up daily. Your REALTOR® will have a strong personal network, great marketing skills and resources for preparing and presenting the best version of your home to the most people possible. I personally have contractors that will do some updates to your home and collect payment at the closing table if that’s something you need. There are commissions involved in this type of transaction and it will require some upfront expense, effort and inconvenience with showings and open houses. But in the end you will walk away with the most money possible.

 

Discount / Flat Fee Broker

Using a discount broker is similar to using a traditional REALTOR®, but with lower commissions and fees. However, there are a few differences. You won’t have exposure beyond having a sign in your yard and input into the MLS. In most cases, you will have to determine the best listing price on your own. If you get this wrong, you’ll either leave money on the table or your home will sit on the market if it’s overpriced. Many real estate professionals agree that getting your listing price right from the beginning is crucial to making the most net profit in the end. Also, it will be up to you to stage and photograph your home so your listing will be at the mercy of how well you’re able to present it digitally. A discount broker doesn’t engage in or assist with marketing efforts. If you don’t know how to properly stage and photograph your home so that it shines and stands out from the rest, you won’t get as many showings. Fewer buyers will bring less demand and longer days on the market. Longer days on the market usually end up with lower offers, yielding you less net profit.


Beyond internet exposure, generating and following up with potential buyers will be completely up to you. Once you’re under contract, you’ll have to work directly with the buyer and the buyer’s agent on negotiations, repairs, appraisal, financing issues etc. so the inconvenience factor is high in this category. You’ll still have to pay the full buyer agent commission and a small listing agent fee so what you’re saving vs what you’re likely to net balanced with the amount of time you’ll spend may not be worth it.

 

Direct to Investor

There are individual investors out there looking to buy various types of properties to either flip or hold as rental property. Most REALTORS have relationships with multiple investors and can get multiple offers at once and present them to you.


Investor offers are always going to be less than market value but most of the time they will pay all your closing costs and don’t ask for repairs. They can close quickly and usually with cash, so you don’t have to worry about a sale falling through due to financing or appraisal issues. This is a great option if you have no desire to “prepare” your house for the market by fixing and freshening up things and if you don’t want to mess with multiple showings. If you have a lot of equity built up and feel like convenience and speed to the closing table are your number one goal, then this may be a great choice.


REALTOR
S can help you greatly with this process by scheduling a large number of investors to tour your home and answering their questions, collecting the offers on your behalf and guiding you through the process to the closing table. Investors won’t collect a buyer agent commission so when I’m doing this for a client I will only charge a listing commission, saving you half of what it would typically cost to put your home on the market and less than using a discount broker.

 

iBuyer

This is a term we use in the real estate industry for all the new companies that have popped up offering to buy your house directly. An example of this type of company is Open Door, Offerpad and Zillow. Using one of these companies is very similar to selling directly to an investor – they can take the house off your hands without putting it on the market and all the hassles that come with that. But there are some important differences.


iBuyer companies will offer you close to market value for your home and they will charge you fees anywhere from 6% - 12%. They’ll also require you to make repairs needed per an inspection. Fees are determined by many factors but basically they look at how quickly they’ll be able to sell your house and how much money it’s going to cost them while they do it. They all operate a little differently. Your home will need to fit their criteria to be eligible for an offer. Sometimes they will make you an offer and then back out because there’s too much work OR if they don’t back out, they may raise their fees based on further inspection.


Some will allow you to use a
REALTOR® so you have a representative advocating for your best interests, and some will not. If you go with a company that doesn’t work with REALTORS, then you’ll navigate through this process at the mercy of this company who’s only looking out for their bottom line.


If you’d like to see what an iBuyer will offer you, a
REALTOR® can manage the process of contacting them all and collecting offers, terms and operation details. It will not cost you anything to compare what these companies have to offer and, in the end, it might be worth it to you for some of the conveniences they bring.

 

iTrade Company

I am a Knock certified agent and what this means is that I’ve partnered with a company who will front money to help you buy a house before you’ve sold your old one, assist with repairs needed to get your home market ready and then help you sell your home once you’ve moved out. They also provide assistance paying the old home’s mortgage until it sells. There are qualifications to meet, some fees and you will ultimately have to repay the money they lend you. It could be a good option if buying before selling would be helpful to you and you don’t qualify for two mortgages. Even with the fees involved it will usually end up costing you less than if you were to get a bridge loan from a lender or sell your house before you’ve found a new one and have to rent for a few months.

 

Sell at Auction

You may be familiar with properties that sell on the courthouse steps each month. Those homes are usually fixer uppers that are bought sight unseen and investors will show up with a lot of cash and snatch them up quickly. But there are auction companies that will allow you to list your home through them and get buyers to bid virtually. The difference between doing this and selling directly to an investor is that you can set a starting bid price and who knows how high it will go. It might be investors that bid on it and it might be a home buyer who’s looking for a primary residence. You’ll need to prepare the home as if you were putting it on the market and get a pre-listing inspection. You can allow showings and open houses if you want to but don’t have to. A lot of the details on how well this will work for you will depend on your specific home location, price point and condition, as well as the auction company you choose. So, reach out to me if you’d like more information.

 

For Sale by Owner

You can choose to sell your home yourself, do all the work and save a listing commission. This option will work if you are in an area that is in hot demand and houses sell quickly by word of mouth. You may know several people who sold their own house and say it’s easy. And it can be in certain circumstances.


If you’re thinking about doing this, here’s a few statistics you need to know. Only 7% of people who sold their own house were successful and out of that 7% most sold to someone they knew. If you do sell your house, you’ll net approximately 12-14% less than if you had used a REALTOR® in a traditional sale. And the scariest statistic is that 75% of real estate related lawsuits happen because at least one party was unrepresented. A lot can go wrong in a real estate transaction and when trouble arises you’ll need to know how to manage it while keeping your buyer from walking.


So in summary, A REALTOR® is an asset in most of these options and don’t cost you much more money than if you were to go it alone. If a REALTORS job seems easy, it’s because they’ve spent years handling every kind of scenario, good or bad, you can think of and continually educating themselves on the laws that guide this business. They can predict, and many times even prevent, problems just based on their experience and get you to the closing table with less stress and protect the equity you’ve built up in your biggest financial asset.


So, whether a traditional sale is what you’re comfortable with or you’d like to investigate one of these other options, I’d love to answer your questions and talk you through each option and help you compare and decide which route, is best for you. Contact me today for a consultation and let’s put a game plan together.

Danna Flemons
JP & Associates Realtors
214-673-3438
dflemons67@gmail.com

Blog author image

Danna Flemons

After graduating college, Danna worked for over 15 years in the advertising and marketing industry helping companies brand themselves and stand out from their competition. Danna's professional backgro....

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