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Oh I didn't know about the closing cost for the seller. Hmmm...how much I hate it!!!!! Will have to raise price accordingly! Probably definitely need to work with an agent to increase price!
If I don't increase, I would lose a lot on 1 year of home ownership compared to apartment rental.
The price the home appraises for, will be the maximum price you can sell it for, unless it is a cash sale by an uneducated buyer. The buyer may pay your asking price, but if appraisal comes in for less than that figure, you will have to reduce your selling price to the appraised value or it is impossible to get a mortgage on the property, and the buyer will let the sale go.
In addition, if you raise your price above what other similar homes are for sale for, you have priced your home out of the market and it will not attract buyers.
Unless you live in an area with huge price increases in the last year, you are going to lose some money when you sell. That is a major reason, it is recommended that one never buys a home, if they will live there less than 5 years. It usually takes five years of ownership, for homes to appreciate enough to let the seller sell, and not lose some money. There are very few areas of the country, where the prices are raising enough in less than 5 years, to guarantee you do not lose money on the home when you sell it in a year or two.
Facts to consider that have been long known in the real estate business. These are from someone that went into commercial/investment real estate brokerage in 1972 and stayed in it till I retired.
1: For Sale By Owner properties are not even considered by better real estate buyers. They want a buyers broker to work for them. They want to have someone that can answer questions they cannot get from an owner. They want to know, someone is looking out for their interests. They really do not trust, the owner to be working in their interests, so stay away from even considering them.
This is easily understandable, because a buyer does not care about losing $$$ on agents' commission, since only seller loses 6%, giving half of that to buyer's agent.
When I become a buyer again, of course I will work only with agents.
When I said in my post before that "if you don't mind letting anyone and everyone who knocks on your door in" I wasn't thinking of whether or not they have the money to buy, or want to make an offer. That comes later.
I was thinking of answering the door to any and every kook who checks you out and decides your house might be a nice place to rumble on a night when you're not there, or whether to tie you up and do whatever. Things are different today, and even real estate agents make you give your driver's license or some other sort of ID, WHICH THEY PHOTOCOPY, before they will take you around on house tours. I realize having an agent cannot completely eliminate this problem, but it sure cuts down on it.
I would never let anyone into my house that I didn't know, or who didn't come recommended.
What would it cost to hire a lawyer to hold your hand through such a process in small-town America?
It cost me $2K on a $225K house to have a lawyer represent me. He handled every transaction, from the first Offer to Purchase (I had some contingencies put in) through to the Purchase Agreement through to the final steps at closing. It would have been less but I was a newbie at FSBO and I asked him lots of questions, not realizing it was ka-ching ka-ching per minute. Plus one buyer pulled out due to the inspection, and that was lawyer time too. After the initial Offer to Purchase, it's lawyer to lawyer only. The seller stays out of any direct communications, with good reason.
The NOLO series is very good. You can read up on the process ahead of time to keep the lawyer cost down.
I also offered (through email to every realtor in my region) a 2% commission for the sale. No one hounded me (well, one out of dozens insulted me, lol). In fact, many realtors came through my home with clients and in the end, it was a realtor who brought the buyer. She got 2% with no grumbles. Of course, I did all the marketing myself, which included paying a "listing" realtor $400 up front to list me on MLS and realtor.com. I also listed on the FSBO site, but in hindsight don't think that was necessary. I did not put an ad in the paper. In a "hot" area, listing online should be enough. And a professionally made sign for out front, not some generic hardware store sign. The sign should include how many bdrms, baths, and acreage/lot size. I got an alternate phone # too.
Oh, and we had a great blog about the house and the area, and included fantastic photos that I took myself. I would never trust a realtor to take those,* even if I used an agent for the whole thing.
* Unless I lived in Raleigh and Mike was my agent!
Frankly, it's not a lot of work. The commission that's paid to an agent far outweighs the work of taking pictures and listing a house. The measurements are on the property appraiser website (and zillow nowadays). Most agents are inaccessible and a pain to deal with. There's just not a lot of value added, especially when you consider the amount they receive.
The sales people want seller/buyers to think it is rocket science and we need to have them save us from folly.
Here in the Bay Area homeowners are selling in one weekend so why would any sane person pay $20,000 or more to have a commissioned sales person fill out a form for a few days "work"? The sellers price their home at a reasonable price to attract buyers, then have the open house for one weekend, all offers will be reviewed the following Thursday. Offers are coming at well above the asking price. If someone were to offer only the asking there is no obligation to sell or requirement to pay a sales commission. Just bring in your best and final offer by the deadline. Several of my neighbors have keep their equity in their own pocket, were it belongs, by using the best and final offer method. Also, no need to worry about the appraisal as if there is a difference it is paid outside of the bank financing.
When I said in my post before that "if you don't mind letting anyone and everyone who knocks on your door in" I wasn't thinking of whether or not they have the money to buy, or want to make an offer. That comes later.
I was thinking of answering the door to any and every kook who checks you out and decides your house might be a nice place to rumble on a night when you're not there, or whether to tie you up and do whatever. Things are different today, and even real estate agents make you give your driver's license or some other sort of ID, WHICH THEY PHOTOCOPY, before they will take you around on house tours. I realize having an agent cannot completely eliminate this problem, but it sure cuts down on it.
I would never let anyone into my house that I didn't know, or who didn't come recommended.
Must vary by region... no one has ever asked to see my driver's license and I look at a lot or property.
All but one of the homes I sold were former rentals and were shown empty...
Must vary by region... no one has ever asked to see my driver's license and I look at a lot or property.
.
Yes, this was Houston, where the OP lives, but I have also had it happen in other areas. There was a very tragic thing happened - actually in Houston - where a realtor was attacked and killed by a "potential buyer" that she was showing a house to one evening. Some people may remember this; it was about 20 years ago. Since then, things have tightened up drastically from the realtor's standpoint. They are very careful who they show homes to.
Yes, this was Houston, where the OP lives, but I have also had it happen in other areas. There was a very tragic thing happened - actually in Houston - where a realtor was attacked and killed by a "potential buyer" that she was showing a house to one evening. Some people may remember this; it was about 20 years ago. Since then, things have tightened up drastically from the realtor's standpoint. They are very careful who they show homes to.
Oh this is really dangerous.
Open house hosted by owner is probably a huge risk.
Especially there are so many sketchy people in Houston area.
Must vary by region... no one has ever asked to see my driver's license and I look at a lot or property.
All but one of the homes I sold were former rentals and were shown empty...
It is a commonly recommended "Best Practice" to get a prospective client to the office first, before meeting them remotely.
At the office, collecting name and contact information and a shot of the photo ID is recommended. Introducing them to a passing co-worker is smart, so someone else has seen them with you.
Of course, recommended "Best Practices" are often ignored, and agents definitely take on significant risk when meeting strangers in remote locations.
Oh this is really dangerous.
Open house hosted by owner is probably a huge risk.
Especially there are so many sketchy people in Houston area.
I would think it safer today... I was showing property... both to home buyers and more so to prospective tenants in the days before cell phones and having a copier available was a big deal.
Most of the property I show is in East Oakland California.
Never been to Houston so can't comment/compare to Oakland.
Growing up around the car business... the Dealers did start checking driver's licenses, keeping keys and/or making copies of driver's licenses when they stopped going on test drives here... a salesman was killed in a auto theft and after that it was rare for a sales person to go on the test drive.
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Make your best and final offer to buy.
