For Sale By Owner
If you decide to sell your home by yourself, there are many issues to manage. This Report will help you to identify what you will need to consider.
Know Why You're Selling and Keep it to Yourself
The other side of "knowing your buyer" is to "know yourself". Your reasons for selling will affect everything from your selling price to how much time and money you will invest in getting your home ready for sale. Your motivation will help you determine what is more important to you: the money you walk away with, the length of time your property is on the market, or both.
Different reasons will cause different strategies. As someone who wants to sell without a real estate agent in an effort to save the commission, it is likely that money is one of your primary considerations (see below). Whatever your reasons, however, it is very important to keep them to yourself so as not to place yourself at a disadvantage at the negotiation table. When asked, simply say your housing needs have changed.
Get The Price Right
From the start, setting your correct asking price is critical. Too high a price can be as costly as setting it too low. Home prices are determined by buyer sentiment in the marketplace, not by what you feel your home is worth.
To help you determine the correct price, objectively compare the price, features and condition of all similar homes that have been sold in recent months, in both your neighbourhood and other suburbs. In addition, terms of sale are often as important as price in today's market. Assess your selling costs and calculate your net gain that you will take away from your sale. Do your figures suggest that now is a good time to sell?
Call me for a Comparative Market Analysis of homes in your area. That way, you can realistically be sure of the figures, instead of making assumptions.
Prepare for the Sale
The first impression of your home by potential buyers is critical. Carefully inspect all details and view it through the objective eyes of a buyer. Remember that your prospective buyers won't gloss over needed repairs and fix-ups, and neither should you! You need to make sure that your home stands out favourably from the competition, take the time to present it well, both inside and out.
Don't move out before you sell. It is more difficult to sell a home that is vacant, which may even cost you money. An empty house looks forgotten and simply does not appeal. If you move, you're also telling buyers that you have a new home and are motivated to sell fast which can, of course, give them an advantage at the negotiating table.
Legal Documentation
There are many important legal contracts and documents that you must assemble, complete and understand. A partial list of forms that you may require for prospective buyers and for legal documentation is as follows:
• Form 30c - the compulsory new Warning Statement for all residential property sales except for those at auction (replaces Forms 29, 30, 30a and 30b) ( Queensland )
• Form 32a - Lawyer's Certifications (replaces Forms 32 and 33) ( Queensland )
• Purchase Contract
• Mortgage Payoff
• Loan Application
• Deposit Receipt
• Property Profile Fact Sheet
• Buyer's Cost Sheet
• Closing & Settlement
• Personal Property Exclusion List
• Property Survey / Plot Plan
• Seller's Statement of Representation
You can check on individual legal requirements for different States of Australia, by contacting the Real Estate Institutes for relevant documents in those states.
Marketing Your Home
As well as the sign you will put out the front, there are many effective ways to spread the word about your home. Local buyers can be reached through local newspapers, but this is only a small part of the market you can target. Be sure you include the many buyers who could already be working with Agents.
To locate them, target as many top agents as possible who are in your market, to see if the criteria of their buyers is a match for your home. Because out-of-town buyers are also an important target, you should create a strategy to reach these people as well. Above all, you should be very service-minded and make it easy for pre-qualified buyers to view your home. Ensure there is always someone available to answer the phone, pick up messages promptly, and be ready to give qualified prospects a tour of your home as soon as possible.
Sort the Buyers from The Tyre Kickers
Don't waste your time entertaining buyers who could never afford your home. Ask questions about their situation - their employment, why they are looking, etc. As you get closer to a sale, check out whether they have pre-approved finance, and will they need to sell their current home before purchasing.
Showing Your Home
Keep emotions at bay during the selling process. The best way to do this during a showing is to stay in the background. If a prospective buyer says something negative about your home, it is better to counter-balance this point of view by illustrating the positives. Don't become defensive! Trust me, this is easier said than done!
Negotiations - Where the Dollars Are!
Some of the many details to resolve before a sale can be considered final are: price, terms, inspections, possession date, buyer concerns and objections. Make sure you fully understand
the contract you have drawn up so you can explain details, terms and ramifications to the buyer and make any amendments to the sale that are necessary.
The contract you use should be thoroughly examined by your real estate solicitor. Some real estate brokers may be willing to help you do this. While this is going on, you will need to manage the buyer's interest in your home so that it doesn't wane during negotiations.
Understand Your Buyer
Your objective during negotiations is to control the process and work the negotiations to suit your time frame. You need to know your buyer's motivation.
• Do they need to move quickly?
• Do they have enough money to pay your asking price?
Knowing this information will give you the advantage in the negotiation because you will know up front, what you need to do in order to get what you want.
Know Your Expected Gain
To determine whether or not you will end up better off by choosing to sell on your own, consider the fact that most buyers do use a real estate agent because it doesn't cost them anything for this
service (i.e. the seller pays the agent's fee). Be cautious, as buyers, investors and speculators who seek out For Sale by Owners are typically those in search of a bargain. The low-ball offers from these types of buyers will often net you much lower in the long run. What you will have to judge for yourself is the following:
Major Points
• Be as prepared as possible with your marketing, negotiations, evaluations, showings and legal documents.
• Consider what it will cost you to effectively market your home and the cost to assemble all necessary materials from the "For Sale" sign to any contracts?
• What price will a buyer offer you as a ‘For Sale by Owner' minus the costs identified in point 2 above?
• Is this net price higher than the price an experienced agent could net for you minus his/her commission?
Private sale can be a rewarding and cost-effective way to sell your home. Just make sure you've done your homework!
If it seems that your role of For Sale by Owner is far too onerous or daunting, feel free to call on me for advice and help.
This Report is aimed at helping you learn more about the Property Market and how to get the best result for you. Thank you for calling on me for help. If there is anything further that you require, do call.
