Selling a House Without a Realtor: 6 Questions to Ask Yourself Before Trying It
It’s possible to sell your home without the help of a realtor. It’s possible—but is it the smart move? Online tools make it seem easier than ever to do it yourself, but selling a house without a realtor can be a risky proposition. Is it worth it? Here are a few questions to ask yourself:
1. Will You Make the Most of Your Investment?
Your home is a major investment, and it’s easy to fall for the trap of thinking the only way to realize that investment is through selling as quickly as possible. In reality, there are several ways you might not make lose out without expert advice.
You could sell right now, and if you’re selling to someone you know, it could seem like the easy choice. But what if there were a real estate professional around to tell you to hang on? What if you rented your home for a year or five and then could sell it for twice as much? What if there’s a good chance you could get another $50,000 just by waiting six months? You’ll never know without the market expertise of a realtor.
A savvy buyer could make an excellent case for why you ought to lower the price on your home. With some convincing statistics, a report by an inspector who visited when you weren’t even around, and a convincing manner, they might tempt you to let your investment go for a lot less than it’s worth. With an experienced realtor on your side, you protect your investment and get the most out of it.
2. Do You Really Know What You’re Getting Into?
Selling a house is a lot more effort than selling a dresser, an old lawnmower, or even your car. It’s a very complicated legal transaction, and if you do something wrong, you could pay a heavy price in tax penalties. In the worst-case scenario, you could even be sued by a buyer.
For example, do you know all the Section 96.300 LAMC requirements you must fulfill before you can enter into an agreement with a buyer when selling property in LA? If you have an older home, does it fulfill all the water conservation ordinance requirements? If the home was built before 1995, do you have your SGSOV or EFSOV in place? Are all your windows, smoke detectors, and carbon monoxide detectors in compliance with the complicated codes of the LAMC?
These are just a few of the complex requirements at work just in the city of LA. There are also state and federal regulations to be met. When you work with a realtor, you never have to worry about missing something important that could cost you big later on.
3. Do You Know How to Figure the Right Price?
Perhaps the most difficult thing about selling a house without a realtor is trying to set a fair price. You know what your home means to you. But what’s the actual market price? If you set your price too high, no one will be interested. Worse yet, your home will get a “reputation” if it sits for too long on the market without a buyer. Even if you later lower the price, you may never be fully able to shed that reputation.
To accurately assess your property value, you have to know the market conditions where you are. You need access to the last six months to a year of data on property sales. You need to be able to compare your property to similar properties in the neighborhood. You also need to know how to adjust the price fairly in the face of certain contingencies, like a repair the buyer agrees to undertake or an upgrade you agree to put in.
A realtor doesn’t just use local listings and a few Zillow pages to find your home’s true value. A realtor runs a thorough Comparative Market Analysis (CMA). This thorough evaluation looks at all nearby properties based on comparable conditions like size, location, and features. It takes into account age, the numbers of rooms, the size, the location, and even small tweaks like when the last remodel of your half-bath was done. It also takes into account market trends and forecasts for a truly accurate estimate of your home’s value.
4. Do You Know How to Screen Prospective Buyers?
There are many reasons real estate purchases fail to go through. But the most common is this: after the initial contract was signed (and a lot of work went into the agreement), it turned out the buyer couldn’t actually afford the home.
A lender may give a buyer a letter of pre-qualification based on a simple application and a cursory look at income and credit. Basically, all this letter says is that, theoretically, the lender would be willing to loan the buyer X amount. It could all still easily fall apart once you go into the details.
A realtor knows the difference between pre-qualified, pre-approved, and an actual lender commitment. A realtor can also help you distinguish the serious buyers from the people who just enjoy visiting an open house on a Saturday. When you work with a realtor, you don’t waste time dealing with unqualified buyers.
5. Do You Know How to Protect Yourself?
A simply unqualified buyer could be the least of your worries. Some people make their “living” off posing as buyers and arranging a tour of properties for sale. Their real interest isn’t in buying the home: they’re actually thieves in disguise.
The scam begins when you hold an open house or get a call from someone claiming to be interested in buying. The person arrives and takes a lot of pictures, but what they’re interested in is any valuables you have and the security features of the home. Later, when you’re gone, they’ll walk back in and take what they want.
A realtor protects you in a couple of ways. First, they’re vetting any potential buyers before they show up at your home. Second, their presence during showings lends an air of professionalism and legitimacy that warns off many scammers. Finally, they may even know about some of the worst of these scammers operating in the neighborhood and can identify a problem person before they ever walk in the door.
6. Do You Know How to Deal With Realtors?
As soon as you start selling a house without a realtor, less scrupulous real estate agents will come out of the woodwork. You’ll be getting constant calls from people at the bottom of the barrel trying to interest you in their services or speak to you on behalf of a buyer.
The longer your home sits on the market, the bolder these people will get. They hope that when you finally get frustrated enough, you’ll just suddenly give up and contract with the first real estate agent who comes along. Then you’re in the perfect position to be taken advantage of.
When you work with a qualified, experienced, reputable realtor from the beginning, you avoid ever having to worry about being pushed around by less savory real estate agents.
The Alternative to Selling a House Without a Realtor
Selling a house without a realtor can be done, but it’s just not worth the aggravation and risk. A qualified realtor protects you and your investment, ensuring your sale goes quickly, and you can get on with the next stage of life.
If you’re ready to sell your home, talk to Teresa Mack today. Teresa Mack is one of Southern California’s most experienced real estate authorities. She’ll put her relentless passion for a challenge to work for you, protecting you and your valuable property investment.