admin | Nov. 14, 2016
Private house sales: could you lose money by selling your home privately?
The ads sound great. “Avoid the high cost of a middleman” says one ad. “Why pay a commission?” advertises another company. Why indeed?
If you’re thinking of selling a house on your own, you might be surprised to learn that you could end up leaving thousands of dollars on the table. Private house sales are not always a win-win!
We recently met with some sellers who were going to sell their home privately. We told them we could probably get them considerably more money by exposing their home to more local agents with buyers. After listing their home, we were able to create a bidding war with 7 buyers and the home sold for over $80,000 above the price they wanted. Were they happy that they decided to work with a real estate agent? You bet! Even after paying the commission, these sellers walked away with a lot of extra money in their pocket that they wouldn’t otherwise have had if they’d sold their home privately.
In a sellers’ market, homes sell quickly and for a good price. It’s tempting to want to play real estate agent, but it may not be as easy as it sounds. Many homeowners mistakenly believe that local real estate agents and their buyers will automatically see their For Sale By Owner (FSBO) listing on the Multiple Listing Service (MLS). While their listing may appear on realtor.ca, what they don’t realize is that local real estate agents in Kitchener-Waterloo use their own real estate board’s system to feed listings to buyers. The vast majority of FSBO listings do not get posted on the K-W Real Estate Board’s system, which means local agents and their buyers may not ever see them. This lack of exposure can translate into your home sitting on the market for much longer than it should.
This past spring, we listed a home for a young couple who had been trying to sell it privately through a popular FSBO company. They had purchased another house and, after almost 2 months of trying to sell on their own, they were starting to panic as the close date on their new home was fast approaching. Within a week of listing, they received multiple offers and sold their home above the asking price. It all worked out well, but the ending could have been very different.
Sure, lots of homeowners have success stories to tell about selling their own homes. However, it can be a risky gamble when things don’t go as smoothly as planned. So, if you’re thinking of selling your home privately, make sure you do your research and consider your options carefully. Trying to save paying a commission could ultimately cost you money in the end.
