We are considering putting our house up for sale by owner on something like Craigslist and seeing if we get any interest.
We would be pricing it on the low side and would not have completed all the "fix-up" projects suggested by our realtor. I think there might be some buyers who would appreciate the fact that we are honest about the house's issues and have not covered up all the problems. (We don't have any major problems, anyway.)
If we could sell our house for a decent price, we would feel a lot more confident about bidding on another house. (There are two houses we're interested in right now, but they are expensive and we don't want to take the risk of paying two mortgages.)
So if you've sold your house yourself, please let me know your experiences, good and bad. Thanks!
We sold our house by ourselves. But in a less traditional way. We sold at the height of the bubble where houses in our neighborhood were being snatched up, demo'd, and McMansions were being built. We approached a couple of the builders who were working on these new houses and set up deals that way. We did spend the money on a real estate attorney and that was well, well worth the couple hundred bucks.
While I think some folks will appreciate your honesty, I think more will be scared off by repairs. Generally, people seem to only have enough for the house (especially, if this is a "starter home"). Cash for repairs may not be available to buyers after they scrape together the down payment.
Professionals who are looking to scoop up "handyman" deals (for rentals or investments) will likely try to beat you up on price to cover "all the work" they'll have to do.
I think even if you want to sell it yourself, you'd probably be better off doing whatever repairs are needed/suggested. Most people aren't going to be looking for high end finishes, but an overall appearance of "clean" and "new" and "fresh" can go a long way.
I go back and forth on the For Sale By Owner issue. I think realtors can be extremely valuable--especially when it comes to pricing a home. Generally, homeowners overvalue their houses and that can lead to stagnating on the market for months (even years these days). In the time it would take a good realtor to price and sell the house, some homeowners will end up paying that commission in mortgage payments and dealing with the headache of being on the market for way longer than they want (plus showing the house, advertising, etc.).
On the other hand, I can certainly understand wanting to save that commission percentage.
Hahahaaa....boy, talk about a non answer, huh? Oh well, maybe it gives you some food for thought. Best of luck with whatever you do!
Thanks for your help! We have had a realtor come through the give his opinion on what needs to be done and what price he would list the house at. We don't need to do any major repairs. Mainly we just need to paint - and clean and scrub, of course!
I just thought it would be interesting to try and sell it ourselves in the meantime. Then we wouldn't have to do all that work first! (If we did happen to sell it, there are three houses currently on the market that I would bid on.) However, I am not expecting that we'll be able to sell it ourselves. We are just going to try and see what happens. We plan to price it 10 to 15K less than what the realtor suggested.
Some buyers might want the chance to fix up the house the way they want it, rather than tearing out the new vinyl floor we'd put in, the paint colors we'd choose, etc.
You were lucky to sell at the height of the market! These days it's going to be really tough. But we do have a good solid house in an excellent neighborhood.
Thanks for the insights!
Well...I come from pretty extensive recent experience here...we were with a reputable Realtor from July 10 through Dec 10 & live in a very desirable area. They had us priced too high & did absolutely nothing for us other than put it on the MLS & a lockbox on the front door. When we had a few instances of careless Realtors come through & leave doors open, let our cats out or lock our cats in rooms that were not previously closed, we asked our Realtor if she could come by during showings if we were going to be gone for more than an hour or so & she laughed & said she didn't have time for that. We never had an offer while with the Realtor.
We went to FSBO in Jan 11 & dropped the price dramatically. We got tons of activity, were able to be present during showings & highlight the pros of our home as well as ensure careless Realtors didn't do stupid things. BUT the 4 offers we got Under Contract (4 offers in 6 months) while FSBO did not end up going through & we are still For Sale. Our FSBO flat fee listing will expire on Tuesday (this gave us 6 months to full access to all major listing services for $500) & we have decided to go with a Realtor who has been really persistent & was willing to come up with an out of the box commission set up for us. We are leaving the home, it will be empty & will probably end up being a short sale. I also can't take anymore of the heartache we have been through & am on the verge of a breakdown over trying to sell this home so it was time to bring someone in who is insisting she can get the job done. We'll see.
I will say this to anyone talking about selling their home in this market...unless you need to because of job loss (our situation), you have been in the home for long enough to not be upside down or you have really incredible luck & intestinal fortitude, I would hang tight for 5-10 years. We have been through buyers whose mortgages fell through at the last minute due to the most strict lending policies the country has ever seen, to buyers who think that because it's a buyers market, they can exploit & rape people of their homes.
As far as Realtors go...I believe the majority are absolutely useless until it comes time to actually try & close the deal. There are a few gems out there who really earn their 5-6%, but not many. I also think that in this market & economy, it's ridiculous that Realtors think they are above "pay cuts" & should still earn the same % they earned 4 years ago when we bought at the height.
If you are really going to put your house out there, I would find out the Comps for your neighborhood, price yourselves attractively below those Comps & give it a try on your own so you don't have to pay outrageous commission to someone not putting forth much effort. If after a few months, you aren't having luck or have deals fall through, find a great agent & give it another few months. But if you head into winter with no bites or hints to a sale, don't leave it on the market. Once buyers know you have sat awhile, they come after your home like sharks.
I should also add that we are in a situation where we bought at the height & our Realtor screwed us. The Inspector was in her pocket, "missed" huge issues that we were left holding the bag on AND she convinced us we didn't need to spend the $ on our own Attorney. First time home buyers-we didn't know any better. We were pregnant unexpectedly & she totally exploited our situation. She had her title attorney handle everything. Now we have a Real Estate Attorney who has been worth her weight in GOLD. If I knew then what I know now...our lives would be completely different.
Thanks for sharing your story. I have seen some of your other posts on this topic and you guys have been through a lot with your house! (And it looks like it's a nice house, too). Is it in NJ? That is probably one of the problems! (I am originally from NJ, and we'd never be able to afford a house there.)
Fortunately, we have lived in our house for more than 8 years and are not underwater on our mortgage. If we listed our house for what we paid, I'm pretty confident it would sell in one day! Of course, we have made multiple improvements and put a good chunk of money into the house.
Most FSBO homes in our area do eventually get listed with realtors. But we could still give it a try. We don't HAVE to move. If we don't get any offers, it's not a big deal at this point. If we were to buy another house before selling this one, however, I would definitely list ours with a realtor because I think it might sell faster that way. But at this stage, there's no rush.
Best of luck to you - hopefully a decent buyer will come along!
I sold a house without a realtor many years ago. I remember few details about it. It took a couple months to find a buyer (it's a very desirable area near a university and the market hadn't gotten anywhere near it's bubble.) I sold it "as is," though it didn't have any issues, it had just been renovated. I was in the process of renovating two other houses and just didn't feel like hassling with anything on that house. It was fairly easy to do. And that was before craigslist existed. I think I just had a sign out front. (In hindsight I regret I sold this house and didn't keep renting it out. I loved that house.)
The houses I was renovating at the time I also bought without an agent. They are located next door to our house. I mailed the owner and asked if he was interested in selling. He thought about it and decided he was. I didn't have the money for a down payment and renovations/repairs and they needed a LOT of upgrades. The houses were falling apart and didn't have heat so he couldn't sell them through a bank. So we did a win-win situation. I put $15,000 into an escrow account. He got $2,000 as a down payment and he carried the loan. The remaining $13,000 was to be spent on repairs. Any repair bills were paid by the escrow account. If I didn't use that money for repairs, he got whatever was left after a year. I had a balloon payment due at the end of two years. Basically, we set it up so I would do the repairs as fast as possible and he would get $15,000 worth of repairs or cash if I flaked out. We also set it up so I would refinance as quickly as possible so he could just be done with the whole thing in a reasonable amount of time.
I had the repairs/upgrades done in a couple months. I was then able to refinance and pay him off. That was done in under 6 months. I've owned the houses for 12 years now and have had good occupancy rates. People always tell me they're the nicest rentals in the neighborhood.
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There are probably a lot of FSBO deals that I would not know about in our town. It sounds like this might be worth a try. If we can't sell it, at some point we'll go with a realtor.
I am very aware of local home values. All the legal, contract, etc. stuff DH and I would need to learn about. We probably would hire a lawyer to help with the transaction.
Any other stories - positive or negative - please share! Thanks.
I recommend checking out open houses in your town (and similar neighboring towns) of houses that are priced similarly to your own house. This is your competition. Most open houses will have the info sheet- address, price, etc. Make notes about the house, yard, upgrades, what needs work, age of big things (like the roof, furnace, hot water heater), etc. Talk to the listing agent and get as much info on the house as you can, especially how long its been on the market, if the price has dropped, what the owners' story is (ie, why they're moving- do they need something bigger? or smaller? job transfer? short sale? foreclosure?), etc. Just pretend like you're shopping for a house. Don't tell the agent that you want to sell your house. Just say that you live in the neighborhood and are nosy. You'll get a great idea about what is out there and how they compare to your house. (And to give you an idea of price.- What if prices in your neighborhood have fallen since the realtor did the market analysis?)
I'd paint your house a neutral color, declutter, take down any personal items (like photographs), and stage it so that the rooms look as big as possible (especially if you have a small house). I assume that one (or some?) of the floors need to be replaced, based on your 2nd post. Instead of you choosing what color, design, etc for the floors, I'd give a "flooring allowance" of whatever you had planned on spending on flooring to the buyer so that they can choose it. The listing agent who sold our house told us about previous sellers he had. There was something wrong with the carpet (old? or worn?) and she just didn't feel right selling the house with carpet like that. So she replaced it with a burgandy carpet. The listing agent also happened to bring the buyers, and the first thing the buyer said was "Oh, my, this carpet is just awful and has to go!" Brand new carpet, and the buyer hated it and ripped it out after buying the house.
If you're not in any huge hurry to sell, I'd try doing one of those flat fee listings ($500?) to get in the MLS and do the work yourself. Make sure to mention that there is a 3% commission (or 3.5%, depending on the going rate) to the agent who brings a buyer. Buyers agents will not choose your house to show potential buyers if there's no commission to be made. Of the house has been on the market for a little while and you want more motivation for buyers agents to show your house, offer a bonus. (I've heard of offering an additional $1,000, or whatever is reasonable based on the cost of your home. Someone else here mentioned a gift card to the buyer's agent so that he/she would not have to share part of it with the broker agency.)
Thanks for the tips. Yes, I do often visit open houses in our price range. I'm pretty confident our listing price would be lower (by $5 to $10K) than comparable homes in our area. But I think buyers would expect this since it would be a FSBO and they would know we were saving the realtor fees.
I do like the idea of giving a flooring allowance. I know what I would want for the floor (which costs about 3K) but a buyer may want to rip all the floors over and start from scratch. I just worry that a flooring allowance would call more attention to the floor problems. I would prefer if the buyer asked us for an allowance rather than us offering it from the start. I think they would feel as though they were getting a better deal that way.
Hey taubel-I wanted to come back & update you...at the very last minute before signing up w/ the local realtor I mentioned in my pp, we chgd our minds, renewed with fsbo & housepad for $300/6 months. We just couldn't accept ending up a short sale just because of a realtor's commission on our side. I decided to take one last run at it myself but with a slight change...
We had a couple with an agent that came through the week prior to that & the agent had called me & to make a long story short, she basically hinted to the fact that her clients loved our home but she didn't like the 2% commission with bonus I was offering. I was pretty straight forward with her and said that if she got me a fair market value offer, from qualified buyers, who would accept the house "as is" (we have been through 3 inspection since April & aren't fixing anything else or addressing the retaining wall that isn't in "perfect" shape) I would give her 3% commission. Next thing we knew, we had an offer that was $10k higher than where we had been at with the last 2 offers. (1 of those was with a realtor at 2% plus $1500 bonus & 1 was without an agent so 0% commission)
So when I renewed with FSBO, I also changed our commission to 3% & got rid of the cash bonus. It definitely increased our showing activity the past 2 weeks & the agent of the interested couple was very attentive in getting their offer together quickly & we are finishing up attorney review now.
I guess I didn't want to believe it...but I was wrong. Agents will push the homes with the highest pay out & fight to close those deals. Our home is wonderful & should have sold by now but I wasn't offering the most attractive commission, so lesser homes around us sold first. An agent on the buy side really makes or breaks you & I didn't put enough value on that. Our 2 deals that were under contract & fell through were with buyers with no agent & in hindsight, I regret wasting time with those offers. They really pushed us around, low balled us, were disrespectful & in the end, weren't as qualified to buy for different reasons. The 1 with the agent that fell through was probably a combo of a greedy buyer thinking we would cave on ridiculous inspection demands and an agent who didn't have that extra $ push to close the deal. Soooo...if you can-list it at 3% and pay the fee to have it listed on the MLS in your state/region by a listing service associated with FSBO. It gives you all the right exposure to the agents & with 3%, they will be eager to show your home & push it.
I will knock on wood right now that this is finally the one...we can finally close this deal!
Good luck & if you have any ?s, feel free to PM me. And yes-we are in NJ. We are moving to Northwest NJ, back to my hometown, where our mortgage & taxes will be exactly half of this house. It is a very rural area of NJ & which is why it's more reasonable. But yeah-NJ is damn expensive!!!
ellairiesmom - Glad things look like they're going to work out this time! That's a good idea about offering buyer's agents some sort of commission. I'll have to look into how that's done in my area.
Good luck with your new house. When I lived in NJ, it was in Sussex and then Warren County. Both beautiful areas!
Thx! Yup-Sussex County bound here...way up by Frankford/High Point...where were you up there? It's so beautiful. I never saw myself back there until I had kids. But now, it's definitely where I want to be. My whole family stayed up there & now my brothers are all having kids & we are all together all the time so it will be nice.
The only downside is trying to save up for bear proof garbage cans-lol!
Good luck to you too & definitely let me know how things go with the selling.
I was in the Newton area, but spent a lot of time in Sussex with childhood friends. Yes, it's a beautiful area! And yes, you better start planning now how you're going to outsmart the bears! Best of luck to you.