For Sale by Owner Question!

General Real Estate Investing
1

Hi All,

I’m thinking of selling one of my single family houses for the first time and I want to do it myself using Zillow. The property is located in Prince Georges county Maryland. I mentioned that this is my first time, therefore I have a few questions:

  1. How do I get Seller contracts? Or do I need any?
  2. What fees will be associated with using Zillow?
  3. Does 2.5% seem like a good fee to pay the buyer’s agent?

I hope that I have provided enough information. Thanks in advance.

dlmcgill

2
  1. There should be a standard contract for your state probably via the bar association.
  2. Not sure for a seller. Probably a few hundred dollars or more.
  3. Depends on the price point of the home.

Word of caution though one mistake could cost you thousands and you have no one to blame… Also stats show fsbo home generally sell for less. Can’t say whether it will equate to your saving but if you value your time probably will be close.

3

I think that my answer to your question is going to ruffle feathers with the sales people in the room but here goes.

  1. A typical Real Estate Sales Agent, (or broker), will tell you that “one mistake could cost you thousands and you have no one to blame but yourself” and that “statistics show for sale by owner (fsbo) homes generally sell for less”.
    In fact, they do sell for less but that’s usually because the seller can afford to drop the price a little since they are NOT paying out 3% to pay a hired sales agent.
    Assuming that you pay a buyer’s agent 2.5% and your house sells for $200k (had to pick SOME number)…

$200k X 3.5% savings = an extra $7k to negotiate with the buyer on their final purchase price.

Also, IF the buyer comes to you with a sales agent in tow, THAT agent will make sure that the paperwork is all complete and accurate since that’s their fiduciary responsibility to the buyer AND they are getting paid $5k to do it.

In addition, the realtors job is pretty much done when the paperwork is submitted to the closing agent, (title company or attorney), and the title company does most of the work to get a house sale closed anyway.

  1. {I copied this from Zillow’s page} On Zillow, it’s free to list a home for sale by owner or agent and to list a property for rent. Zillow’s online and mobile search tools, including its smartphone app, let users search for property and view estimated property values for free, too.

  2. See my comments under #1 above. I believe that 2.5% is more than enough to pay a hired sales person as commission for one sale.

4

Great responses guys! A special thanks to shmikle for that enlightening response.

dlmcgill

5

Okay, Debbie Downer here…

“One mistake can cost you thousands of dollars” & “FSBO sellers usually sell for less.” Well, that’s realtor-speak for “Only real estate agents should be handling your deal.”

‘Agents’ are a two-syllable words for ‘unnecessary overhead.’

I realize you’re attempting to put your house on the MLS, and a buyer’s agent is gonna want something for their effort. But when the competition is offering 3.5%, your house will get less attention than a ninety-year old hooker with herpes.

Never mind agents want 7% when they work both sides of the deal, not 2.5%.

I’m not against using agents to sell a house, because I want someone else to do the grunt work. The problem is few will do the grunt work, and I end up doing it anyway …and paying the commissions …anyway.

Meantime, the risks to the buyer include believing what the agent tells them. And the risk to the seller is believing what the agents tells ‘them.’

Agents work for themselves, not you. They are happy, anxious and willing to lie, cheat, and steal to bring everyone to a closing.

Did I mention that agents are about making a commission, and not making sure YOU don’t make mistakes.

They’re fine with you making mistakes if it means getting paid.

The fact is, contracts to buy/sell are on the internet, and the only issue is reading the contract and knowing what it’s saying. A buyer’s agent will bring an offer printed on the Board of Realtors’ documents.

The universal agreements usually favor a seller. That’s fine, if you’re the seller.

If this was me, I would put a for sale sign in the yard, and bandit signs on major corners near the property. The hottest prospects are already trolling the area for a house to buy. I’d list a ‘dead’ number with an outgoing message that details the house and gives the address, so that I’m not repeating myself, with every looky lou.

The sign in front of the house is the only one with a live number (the one you’ll answer). This reduces nuisance calls, since only those who’ve seen the house will see the ‘live’ number. Never mind that many of the calls you would get come from agents wanting to list the house.

You can do a LOT of marketing with $7k in order to get the best price, in the shortest amount of time.

That’s all I got.

6

Have you guys had any experience with mrlisterrealty.com? I’m thinking of first listing on Zillow.com for free and depending on how many junk calls that I receive, I may switch to Mr. Lister. They charge about $600 to list the property on the MLS and the price includes a yard sign, lock box, and having them review the buyer’s agents contracts.

What do you guys think?

dlmcgill

7

Good Idea, thanks, going to use this on my current flip.

Jay

8

dlmcgill

I suggest you maybe you try to search in Google of marketing place to post free in your property that has no having a charge.

thank you and good luck