Selling newly remodeled home without an agent. Thoughts?

40 Replies

I just completed a rehab on an SFR and i am hoping to put it up for sale asap. I'm having a hard time deciding if i should use a listing agent to market the house and get me top dollar, or trying to do this myself. I'm pretty good with paperwork on RE already, so i think i can navigate and negotiate everything without an Agent. I was also thinking of listing it and just doing like a 3% commission to the buyers agent. I just would hate to go under contract and the other agent beating me over the head during inspections or contingencies that'll make me lower the sales price.

Any thoughts or advise on this ?

This is how I sold my first bunch of houses. I got it on the MLS through an entry only site and did the selling myself. I offered 2.5% to the buying agent. I sold them all with very little effort. The only hiccup out of 5-6 houses was one appraisal issue that we had to meet in the middle (closer to my number than the appraisers).

My opinion is that realtors are worth it (I use one now, but am getting my license as well) however I found listing and selling my own deals was not complicated. The main thing, make sure it's on the MLS and offer the buyers agent a fair fee (you say 3% which sounds right). Assuming you can navigate contracts, schedule and coordinate with inspections/appraisers, and are comfortable with it I think it's a viable option.

@Maugno M. There's more to selling/buying a home than getting the paperwork through the closing process. When you get an agent, they are taking on the responsibility of any issues going wrong or things being missed. By you not being an informed agent, if something gets missed, it's on you to take the hit, if you have an agent the liability falls on them if anything in the paperwork or process is wrong.  

Personally since I'm not an Agent, I wouldn't be selling or buying property without one, Google can only get you so far! Agents can chime in but I think Agents are required to be up to date on the latest changes in real estate laws and regulations, if this is missed in your Google searches or you're downloading an old form to be used, the buyers agent isn't going to help you out if you're the buyer in your mistake.

Something to consider is if you're in a hot market, you may be able to offer less than the typical 6% fee since the property may require less effort to sell provided it's a higher priced property and you're not trying to offer 4% a $75,000. I've done higher priced properties where the split was 4% seller / 2% buyer (Me) so my agent took 2%. You may be able to find some middle ground instead of going without an agent. This is business, everything is negotiable!  

I hired both a realtor (2600.00) and a real estate lawyer (400.00). Realtor sat and watched as lawyer ran the whole closing. Easy pick, I’ll do the 400.00 thing every time! 

@Brian Pulaski
@Ray Johnson
@Mark Burlison

There are a couple of homes down the street. The owner of one of those homes was trying to sell himself and he wanted 92k. I called just to inquire and give myself an idea of the market value in the neighborhood. He never sold and i saw that he ended up using a realtor. Well i see it on Realtor.com and it's listed at 97k and under pending. I was shocked, i thought he was asking to much.

@Maugno M. Find a top agent and they will more than make up for the 3%. 

I previously thought the same as you and still do when it comes to an average RE agent. But the best ones in your market will absolutely be worth paying a commission for.

Originally posted by @Mark Burlison :

I hired both a realtor (2600.00) and a real estate lawyer (400.00). Realtor sat and watched as lawyer ran the whole closing. Easy pick, I’ll do the 400.00 thing every time! 

By closing time, the Realtor's job is done, other than making sure all the paperwork is the same as the ones we reviewed days ago.  Closing is a title attorney or agent's job, and is not one that a Realtor is licensed for.

A Realtor's job with a client starts with advising you how to present and strategically price your home and goes through marketing and prospecting for buyers, scheduling and arranging showings, vetting buyers and lenders, ensuring the right contract is selected, enforcing time frames, making sure that the lender, buyer, title, appraiser, inspectors, and any other vendors that come in are doing their jobs on time, being an economic and vendor resource, managing expectations, communicating with everybody involved, etc.  . .  Not to mention the market research that has to be done daily to ensure that all of our clients are up-to-date and can act strategically and always be in a negotiating position of power.  Or at least have the knowledge to act appropriately.

There is literally nothing for a Realtor to do at closing other than read over documents, occasionally witness a doc, and pick up a check.  I don't even attend all of my closings, since there is no need.  The ones I do attend are my first-timers or special cases that like to have their hands held, which I don't mind at all, it can be fun and exciting.  My time is much better spent working for my other clients, though.

I'm not saying your Realtor was or wasn't useless, but don't always let a half-hour of forced inaction fool you!

Originally posted by @Maugno M. :

I just completed a rehab on an SFR and i am hoping to put it up for sale asap. I'm having a hard time deciding if i should use a listing agent to market the house and get me top dollar, or trying to do this myself. I'm pretty good with paperwork on RE already, so i think i can navigate and negotiate everything without an Agent. I was also thinking of listing it and just doing like a 3% commission to the buyers agent. I just would hate to go under contract and the other agent beating me over the head during inspections or contingencies that'll make me lower the sales price.

Any thoughts or advise on this ?

I might get killed by other agents, but a Realtor isn't always necessary, depending on how comfortable you are with the process, and how much having an agent helps your negotiations .  See my other post for a start of what a competent agent can provide.  And I do recognize that all agents are not equal in service or competency.

That being said, the types of people that do well selling their own homes and the ones that have a passion for it are usually the ones that end up getting their licenses.  Everyone else seems to eventually sign an agent.  You might not need every single service that an agent can provide, and yet it does seem that most people need most of them.  I have clients that don't need my staging advice, and yet they've absolutely benefited from my negotiations.  I've had clients that are negotiating machines, and have needed hours of coaching on presentation.   And in my experience, and the numbers seem to track, most FSBOs end up listing or selling for less.

@Dan Maciejewski gave you some great advice. And I completely agree. Some people don't need a Realtor to sell their home. BUT most people will benefit from one and they usually end up making more than they would without the Realtor. It's worth noting that some Realtors will try to deter clients from offering on FSBO houses because of the extra work that's involved. (Not saying it's the right thing to do, just saying it happens.) Also, if a Realtor does get involved in the sell they have a written agreement to work in the best interest of their client (your buyer). In general, they are not there to protect your interests AT ALL in this transaction.

If you have time to take all of the calls, do showings, be present for inspections, appraisals, and you are comfortable with the contracts and negotiations then you may be okay to do it yourself and/or use an entry only listing service.

But you don't have time to FULLY dedicate to selling the property by yourself and you aren't well versed in the contracts that are used in your area, then a good listing agent will certainly end up making you more than the 3% that you spend on their compensation. 

The whole process with a realtor was far over rated in my opinion. I can call listings myself and meet the realtor representing the property. Unless I was going to go into a area I was unfamiliar with.

@Will Gaston
@Dan Maciejewski
@Cassi Justiz

I have alot to think about. Ive done several flips where i don't remodel just sell as is, or several vacant land deals all cash and have done a Brrrr but this would be my first major sale.

I want to sell on my own to get a feel of what a RE agent does. If it went well i'd consider get my RE License and grow my business. 
on the other hand, if i got an agent to sell I could learn from them and duplicate it in the future.

I have to do 6% commission right ?

The last 5 houses in my neighborhood sold WITHOUT any agents . And they were all over $500K . They were posted on facebook . If your market is moving good , I would give it a shot .

MLS is key.. find a broker that just charges flat fee of 500.00 or so.. in the listing they say call owner to show.

and you do the rest.. see if you like it.. at your price point would not be worth my time to deal with it.

@Matthew Paul   example that would be worth my time.. 

I list all of my properties with agents. even though I have been a broker since 1975.. LOL..  

But will list myself if i have a bummer deal that i need to save money on.. but that has not been often the last 7 or 8 years. 

@Mark Burlison   as stated closing table and the sales process are not even comparable..  does the lawyer show the house ?  does the lawyer show up for the home inspections.. ??  does the lawyer write the purchase and sale contract and all the counters and addendi ?  NOPE for 400.00 its simply the closing..  My wife and I who are both 30 year plus veterans do believe we are seeing a change.. no question. and in higher priced markets commish are coming down no doubt.

but in low value asset land IE under 120 to 150k houses if we could not get full commish its not worth the time just to make a few grand.  better things to do that with the time involved to create income.

@Jay Hinrichs  Yes  if the $$$ are there and you are busy with other things , drop it with an agent . Where I am is a very hot area , the reason is its the best school district in the county , they just built a $150 million dollar high school . We also have community boat slips and pool . When priced right houses sell in a week or less . One family in the community bought 1 and sold another  in the same community word of mouth . (Bought waterfront and sold regular house 1.9 million total sales between the 2 and no agents involved . 

Originally posted by @Jay Hinrichs :

MLS is key.. find a broker that just charges flat fee of 500.00 or so.. in the listing they say call owner to show.

and you do the rest.. see if you like it.. at your price point would not be worth my time to deal with it.

@Matthew Paul   example that would be worth my time.. 

I list all of my properties with agents. even though I have been a broker since 1975.. LOL..  

But will list myself if i have a bummer deal that i need to save money on.. but that has not been often the last 7 or 8 years. 

@Mark Burlison   as stated closing table and the sales process are not even comparable..  does the lawyer show the house ?  does the lawyer show up for the home inspections.. ??  does the lawyer write the purchase and sale contract and all the counters and addendi ?  NOPE for 400.00 its simply the closing..  My wife and I who are both 30 year plus veterans do believe we are seeing a change.. no question. and in higher priced markets commish are coming down no doubt.

but in low value asset land IE under 120 to 150k houses if we could not get full commish its not worth the time just to make a few grand.  better things to do that with the time involved to create income.

 Like Will said top agents are worth it compared to the 99% of guys that dont know what they are doing....but like Jay said...most top agents might not take your listing due to price point.  That price point due to my fixed costs with servicing a listing would actually cause me to lose money.  Most agents in my area who do a lot of business wont touch anything under $200k. 

@Jay Hinrichs Thanks for the feed back, I have seen that on BP about members just using a flat fee service to get on the MLS. Do exactly how you said it, get buyers to call me. If an agent brought me a buyer, i could even then negotiate for buyer to pay the realtor commission. But I think i'd even pay the 3% commission if agent brought me someone. Better than paying the full 6%.
I am stretched thin, went over on rehab so i can use any penny i can save. But like others have mentioned, maybe it'll pay itself off getting agent.

Originally posted by @Matthew Paul :

@Jay Hinrichs  Yes  if the $$$ are there and you are busy with other things , drop it with an agent . Where I am is a very hot area , the reason is its the best school district in the county , they just built a $150 million dollar high school . We also have community boat slips and pool . When priced right houses sell in a week or less . One family in the community bought 1 and sold another  in the same community word of mouth . (Bought waterfront and sold regular house 1.9 million total sales between the 2 and no agents involved . 

Paul I will say this is quite rare though.. I still have to list all of my product on MLS no way it would sell fast enough with us just doing our facebook thing.. a lot of it is the sophistication of our buyers.. these are first time or one move up at the 400 to 550k mark here in Oregon and or Charleston were I am active. And especially Charleston were buyers are all programed to go with their own lawyer..

Originally posted by @Maugno M. :

@Jay Hinrichs Thanks for the feed back, I have seen that on BP about members just using a flat fee service to get on the MLS. Do exactly how you said it, get buyers to call me. If an agent brought me a buyer, i could even then negotiate for buyer to pay the realtor commission. But I think i'd even pay the 3% commission if agent brought me someone. Better than paying the full 6%.
I am stretched thin, went over on rehab so i can use any penny i can save. But like others have mentioned, maybe it'll pay itself off getting agent.

YUP the limited service broker is probably your ticket.. U can try yourself and find yourself 90 days down the road with no sale and deeper in the hole.. MLS is the most powerful sales tool in the US hands down.. you have thousands of dedicated agents whose lively hood is to sell houses.. there are outliers like Paul was talking about but read the fine print.. Best school district in the state 900k houses ( so business owners and very sophisticated folks..) these are not your 100k home buyers Just saying

@Russell Brazil I understand the picture now, of what @Jay Hinrichs is saying. Yeah this is a home under the 100k range, so maybe a top agent doesnt even care for %6 commission he'll make at that price point. That's what im afraid of, giving it to another amateur agent and they letting it sit. I could do that myself.

How can i get info or stats on top performing agents in my area? Any website for that  . . .

Originally posted by @Maugno M. :

@Russell Brazil I understand the picture now, of what @Jay Hinrichs is saying. Yeah this is a home under the 100k range, so maybe a top agent doesnt even care for %6 commission he'll make at that price point. That's what im afraid of, giving it to another amateur agent and they letting it sit. I could do that myself.

How can i get info or stats on top performing agents in my area? Any website for that  . . .

 Real Trends/Wall Street Journal maintains a list of the solo agents over $20 million and teams over $30 million in each state. (Im top 1% nationally and I still dont qualify for their list as Im right around the #100 solo agent in my state,  about 50 solo agents in my state get that high) (Sidenote mostly for Jay: I should just take on a couple of mid tier agents to make the team list)

If you drive around and start seeing the same name on all the signs...thats a pretty good indication. Ask around...the same names might keep coming up. I pretty much know every $10 million up agent within a 75 mile radius of me. 

Also keep in mind, that 6%...thats getting split in half with the buyers brokerage. Listing side broker is taking a piece then fixed costs come out of that, photography, transaction fee if one, signs, marketimg materials, transaction coordinator if they have one.  Just to service a listing costs me about $2,000. Thats why I say a lot of guys might not even take the listing.  Id be negative on the transaction.

Originally posted by @Russell Brazil :
Originally posted by @Maugno M.:

@Russell Brazil I understand the picture now, of what @Jay Hinrichs is saying. Yeah this is a home under the 100k range, so maybe a top agent doesnt even care for %6 commission he'll make at that price point. That's what im afraid of, giving it to another amateur agent and they letting it sit. I could do that myself.

How can i get info or stats on top performing agents in my area? Any website for that  . . .

 Real Trends/Wall Street Journal maintains a list of the solo agents over $20 million and teams over $30 million in each state. (Im top 1% nationally and I still dont qualify for their list as Im right around the #100 solo agent in my state,  about 50 solo agents in my state get that high) (Sidenote mostly for Jay: I should just take on a couple of mid tier agents to make the team list)

If you drive around and start seeing the same name on all the signs...thats a pretty good indication. Ask around...the same names might keep coming up. I pretty much know every $10 million up agent within a 75 mile radius of me. 

Also keep in mind, that 6%...thats getting split in half with the buyers brokerage. Listing side broker is taking a piece then fixed costs come out of that, photography, transaction fee if one, signs, marketimg materials, transaction coordinator if they have one.  Just to service a listing costs me about $2,000. Thats why I say a lot of guys might not even take the listing.  Id be negative on the transaction.

Russ my wife did about 15 million in 18 that was a good year for her. . so I think she might just be in the top one hundred in our market. and to your point she pays her transaction coordinator 400.00 per file. And most all top producers have those .. Although she does rely on MLS for marketing and spends very little on marketing to actually next to nothing. and out our way the lenders will help with marketing materials and stuff for open houses.. along with a little help from title companies within the laws of course :) what she is very good at though is closing and holding deals together.. I don't think the public understands that this is sales. You have to have some good skills to be a top producer.. its not like be an investor where any ole personality works just fine..

@Jay Hinrichs   Normal is all based on where you live . 

Where I buy ( 15 miles from where I live ), there is no such thing as a $100,000 house , a lot cost about that .   $150K gets you a tear down , $200K gets you a total gut . If luck is on your side , you may find a deal word of mouth 

Originally posted by @Matthew Paul :

@Jay Hinrichs  Normal is all based on where you live . 

Where I buy ( 15 miles from where I live ), there is no such thing as a $100,000 house , a lot cost about that .   $150K gets you a tear down , $200K gets you a total gut . If luck is on your side , you may find a deal word of mouth 

 Same with us Matthew  in portlandia lots like you say start at 100k and that's only if I buy the dirt and do all the entitlements and then do all the infrastructure other wise shovel ready 125 to 200k each..  and I Charleston we pay 120 to 170k for lots.. and I bought one last year for 570k for the lot.. and will close on 3 more next month at 530k each.. its all relative to location that's for sure. 

just need to have the right spread when you retail them.. I no longer do big gut jobs .. Only ground up.. 

and lastly I buy 90% of my deals right off of MLS.. :) I don't really like to deal with the off market guys they =tend to waste a ton of time and I find its amateur hour .. My agents will bring me off market deals for sure.. its how you build your teams by being a proven buyer.. you would be surprised how that works ( well you probably are not) but all these folks that think they need wholesalers. :)

Land is tight around me , the big boys are now going after the 4 and 5 lot subdivisions . That use to be the small builder niche 

@Jay Hinrichs yeah right about $15 million is where Ive settled in. I dont really advertise. I speak at the occasional REIA or Meetup. All the people at those know who I am at all the REIAs in the area. Ive got a base of high end investor clients that are going to buy a couple properties each each year that gives me a base of $5 million in volume each year without having to think. I hate taking my title attorney or lenders money for marketing. Everyone else does it, but its not my style. Probably a few million in referral business each year. A little bit of soft farming in a couple neighborhoods for a few million a year.

Looks like in Oregon, Real Trends has 45 solo agents at $20 million and over...so yeah, your wife is probably sitting right about #100 in the state I bet for solo agents. (DC has 38 solo at about $20 million). We all sell across the 3 states here, they just get measured by where our office location is. Most of my business ends up in the District and not in Maryland, at least volume wise. (Though the top solo agent in DC is at $235 million per year, so the difference between her and I is over $5 million in income per year lol)

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