While we encourage you to sell by owner, the truth is, once you start advertising your property for sale the local real estate agents will contact you. In every state you have the right to sell your property without the help of an agent, it is your choice to use an agent. There are different ways to use an agent. You can agree to let them show your property to just one person or you can let them put you into the MLS and let all agents know you are willing to pay a commission. What commission you pay is up to you, not the agent. By state law it is negotiable. The agents may tell you “in this area we all get ____ % for selling a property”. This statement is highly unethical and could be considered a Federal Crime under the Sherman Antitrust Act of 1890. You see, Price Fixing is illegal. When you go to work each day, are you aware of how much you will earn that day for doing your job? And at the end of the day are you aware of exactly how much is owed to you? Agents are no different. Before they bring a buyer to look at your house they want to know exactly what is your selling price and what they will be paid. Otherwise they will not show up. Would you show up for work, did your job and then at the end of the day your boss says “I’ll let you know on payday what you will receive”. So, you will need to confirm in writing and upfront the commission or compensation you will pay at closing. As a reference, you might want to look at the closing statement when you bought the house to see how much agents have received in the past. Also, very important, the agent you are dealing with works for a registered and licensed Real Estate Broker. At closing, it is the Real Estate Broker that receives the commission and they are the ones actually paying the agent. The amount of money the agent receives is strictly between them and their broker. Do not pay anything directly to the agent. Commissions are paid at closing. For the past 10 years, using a Flat Fee agent has been to most cost effective way to use an agent to sell your property.
Archive for February, 2013
One Answer: make it as simple as possible for the buyer.
Here are some tips to making selling my home simple:
1. Communication: always answer your telephone. True, once your telephone number is published you do receive many unwanted calls, for example from real estate agents, but the buyers don’t know that. A true buyer wants to talk with you now and have their questions answered. You need to be there.
2. Appointments: be available to show your property at all times. Some of the best buyers are from out of town and they are on a time schedule. Others work and are only available nights and weekends. Be accommodating.
3. Signage: make it professional and have a QR code on it. 25% of all real estate searchs now come from mobile/smart phones. These buyers don’t want to write down your telephone number and address. They want to quickly scan the QR code and then they have all of your information. One of the few companies offering a QR code on all signs is: FSBO.com
4. Internet marketing: You should be on as many websites as possible and with as many photos as possible. Here is a quick list of free or low cost websites: Zillow.com, Yahoo.com, Craigslist.com, FSBO.com
5. Value your property: you will need to prove to the buyer that your sale price is fair. To do this you need a third party. Either pay for an appraisal, have documented sales in your area (court house/assessors office can help), have an agent do a CMA or use an online appraisal
6. Contracts and closing: have contract, deposit and closing information ready the first day you put your house on the market. The best place to start is by contacting the company that handled the closing when you bought the property. They would love to help you. Contracts can be bought online.
7. Competition: you have competition and the buyer knows that. You need to visit or be aware of all properties currently for sale in your area. The buyer may look at other properties and you need to be able to convince them why yours is better
Your expected life span has gotten longer. The average length of time owning a car has gotten longer. And now, the average length of time people stay in their home has gotten longer. Prior to the year 2000, seven years was the norm. Mortgage companies used this information when setting the interest rates on your 30 yr mortgage, because they knew on average, the mortgage would be paid off at seven years. (this is why watching the 10 year treasury notes is so important). From 2000 to 2007, this number dropped to six years. People were moving, getting married, getting divorced, buying/selling, and things were happening. Now, the average length of time people stay in their property is nine years. This is the longest on record. Many reasons, probably the biggest is the properties have dropped in value, so why sell now. Make some improvements, buy a big screen TV and what do you know, “I am comfortable” and moving does take some effort. You look around your neighborhood and you do not see many yard signs and in some areas like mine, it’s been six months since I saw a yard sign. What happens next? There is such as thing called “psychology of a yard sign”. At some point, houses will come up for sale. This usually happens in bunches. The first sign goes up, you drive by it on your way to work and deep in your brain you start thinking “hey, they are moving, maybe I should”. Realtors now this trick when trying to get listings. In neighborhoods that have slow turn over. Once a few new signs go up, they start working extra hard to contact the neighbors and potentially get their listing. They know a trend has started. Next thing you know, you are saying to yourself “hey, all of these new people living in my area and I don’t really know them like the former owners”. All of sudden, you not as comfortable as you once were. “Where did everyone go”, maybe it’s my turn to sell. This happens in many areas in your city and the next thing you know the number of properties on the market approach their historical averages. Whether this information helps you or not, the statistics of real estate are like a big pendulum, and the pendulum is about to start swinging in the other direction.
things keep improving in the housing market. Weekly I read statistics involving the real estate market. Every trend is at the four year level. The latest is ‘mortgage delinquency rate’ now at 5.19% of homeowners behind on their mortgage payment, this is the best in four years. Housing inventory is at a four year low. Sales of existing homes are at a four year high. Builder sales and prices are at a four year high. Home prices are at a four year high. Home affordability is at a four year high. Mortgage rates are only at a one year high, but the next headline should read “Mortgage Rates hit a four year high”
All last year we were telling you that house inventories were shrinking, investors were in a bidding war and interest rates had bottomed. This year we are seeing confirmation of this trend. Today, Core Logic reported 2012 house prices gained to 8.3%. Prices were up in 46 out of 50 states. Arizona had the largest gain, 20.2%. We predicted in our blog on November 19, 2012 that you will see headlines this year that read: “Experts were shocked by the jump in prices people paid for housing”. For the first time in six years builders are now raising there prices. With low inventories of resale properties, buyers are forced to buy from the builder. At FSBO.com, we are hearing more stories of selling by owner in only a matter of days. If you are planning to sell, this is a window of opportunity for you.
Sellers often ask us how to get more exposure for their properties online. The solution is simple and it is a hybrid between being a For Sale By Owner (FSBO) and listing with a traditional broker. With FSBO.com’s Flat Fee MLS Package, your property will be posted on your local MLS for agents to see. Now here is the nice thing about the MLS…syndication! Listing syndication is when the MLS feeds out their listings to third party websites and this is where the amazing exposure comes from! Realtor.com, Zillow, Trulia and Yahoo are often the most asked about websites and your property would be listed there. Check out a partial list of other national websites that will also pick-up your listing once listed in the MLS…
You can view more websites on MLSmart.com. Your property will also post to local real estate websites in your area!
Now, this package will cost you more since you will need to agree to cooperate with Buyer’s Brokers; but for most, the added exposure is worth the extra cost. And remember you are eliminating the listing broker’s commission - so you save about half of what you would spend listing with a traditional real estate broker.
Visit our Flat Fee MLS Page for more information or give FSBO.com a call if you have questions on how this program works - we are happy to help! 800-690-5802 x1.