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Think I have found a home I am interested in buying as my primary residence. Current owner has 2 other properties where they spend most of their time. The owner has his house casually up for sale via word of mouth and would like to avoid a realtor mostly due to cost involved. The email I have from the owner states numerous upgrades (house is 35yrs old) but his "if we have to list it in September it'll be for $xxx." That price is about 20% more than it's worth according to Zillow estimate, local comps and the most recently sold home in the neighborhood. Owner is flexible in timing, settlement dates, etc. I would need to sell my current home and plan on doing so with a realtor.
So my question is how do I go about figuring out the real value and what a reasonable offer should be? I would require a home inspection and all the other necessary precautionary things to do before buying a home. Do I have my realtor assist me, would he expect a commission, etc?
FWIW if I use the sq/ft calculation of the asking price and use it on my home it also yields about a 20% increase in the value of my home. Sure I'd love to get that amount but the reality is that price isn't reality!
How do you figure out the real value ? Hire an appraiser. Houses are not sold buy the pound or the square foot. They are sold based upon comparable sales. Don't want to hire an appraiser. Hire a real estate agent and have them do a market analysis for you..
Your real estate's agent work is for the sale of the home you list with him or her.
Would you bring you car to the shop for brake job, pay for it, then have your wife drive her car in and ask for a new muffler for free because they worked on the other car ? Good luck with that.
Same with houses. No one owes you anything for free. People get paid for their time and effort. If you don't want to pay anyone anything then do your own research, down load a purchase and sales agreement off the internet, etc. You can certainly do the whole thing on your own and save yourself whatever it is you think you're saving.
That's my point. I have a good relationship with my realtor and am curious how to bring him into the house I am interested in. I doubt the sellers will want to spend/pay the 3% to him so is a flat fee an option? Guess I need to ask him what he thinks of the situation and go from there.
When you sell your house, you pay the commission and then maybe your agent will agree to do paperwork for you on your purchase for a couple hundred dollars.
The agent that I used for several transactions did paperwork for me for $300 on a FSBO that I bought.
I've sold a couple of different houses where nobody used an agent. The escrow company handled paperwork. I'm an honest seller, the buyers were good decent reasonable people, and everything went very smoothly.
On the other hand, I sold one where the buyer was such a jerk I probably would have strangled him to death if my agent hadn't been running interference. She earned her commission on that one.
So, it works fine without an agent if everyone is reasonable. Many sales involve at least one party who is very difficult and that's where the agent earns their keep.
Something to keep this in mind. Even if you get the house for "market value" do you get to have a realtor who is paid a commission by the seller on a different house? Another way to say that is are you getting a discount for not having a realtor?
Hire an appraiser, title search and a home inspector. Appriasier is in the order of magnitude of 400$, title search maybe 150, home inspector maybe 500. Then when you buy I would suggest a cashiers check and simple sign over of title, file the title at the recording office and your done. You can do escrow if you want that's another 300 or so.
The whole process should cost a little over 1000, if you hire a realitor they will take up to 6% which could equate to 5 figures depending on the value of the house.
I am happy that sellers are wising up, they likely own it out right and they are not going to tolerate loosing money to pay a realitor commission they will make you pay it and if you don't like the price they simply wont sell it. Sellers are getting tired of eating outrageous fees.
If you can get a realitor to work on a flatrate basis they can save you some hassle but certainly not $10,000 worth. A lot of people have an over inflated sense of what their hourly rate is worth.
I've used a real estate attorney at a fraction of the price of a realtor. The attorney even supplied the title insurance way cheaper.
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