FSBO or real estate agents or both?
If you decide to go with option 1 and sell the property with an estate agent, here’s what you can expect them to do for their fees!
Actively advertise your property: on your windows, through the Internet and local advertising. Talk to potential buyers about your property and then arrange viewings. Give you regular (usually weekly) updates on general interest in your property, how many viewings have been scheduled, what the “feedback” has been from viewers, and what type of marketing they will be doing in the coming week. Take color photos of your property, both internally and externally. Give advice on the price of your property and any potential price adjustments, with evidence to back up your advice! If an offer has been made, they must write to both parties within 24 hours.
Once they have found that all-important buyer, they need to do the following:
Once a sale has been verbally agreed upon, it must be confirmed in writing. Agents will produce a Memorandum of Sale. This includes all important information needed to proceed with the sale. You must have the following:
The full name(s) of the Seller (You!) and the Buyer(s) and their contact details, including address. The full name of the attorneys for both parties, including the full address, telephone and fax numbers, and the full name of the person negotiating. What is the position of the buyers: for rent, SSTC (sold subject to contract) or cash buyer. The purchase price (written in figures and letters) and everything that has been included in the sale, that is, washing machine, curtains, etc.
The Memorandum of Sale is then sent to all parties (Seller, Buyers and both Attorneys) by the Realtor.
Once the Solicitors have received instructions, the Estate Agents will monitor the progress of the sale, keeping in close contact with the Solicitors, the Mortgage Company/Financial Advisors and of course the Seller and Buyer. This is where the use of a real estate agent is invaluable as they have the experience of dealing with these professionals on a daily basis and know the type of questions to ask so they can determine how the sale is progressing. They can also act as an intermediary between the seller and the buyer, thus easing any unnecessary tension between the two parties. House moving is a notoriously stressful time, so things can get a little tense at times! The estate agent must be used to this and by monitoring things closely (known as ‘Chain Chasing’ or ‘Sales Progression’) you will be able to alleviate any anxiety.
Once you’ve traded contracts, you’re almost there! In exchanging Contracts, you will have agreed to a mutual termination date. On the day of completion, your attorney will notify your realtors when the funds have arrived so they can hand over the keys to your buyers.
The downsides of having a real estate agent are that you will have to pay them a fee for their services (ranging from 1-2%) and also that you are quite reliant on them to provide you with regular (and accurate!) updates as things are progressing with your sale.
Your second option is to manage everything yourself using sell your property online with FSBO (For Sale By Owner!) sites.
If you choose this option, you must remember that you will have to do all the binding yourself (including awkward situations!). You are perfectly entitled to do so and of course you will not have to pay any Agent fees.
The actual marketing of your property depends solely on you:
You can set up a private listing board on your property. Place an ad in the local newspaper (although this is quite expensive for an individual, while it is included in the estate agents’ fees). Advertise online (but once again it’s quite expensive and maybe not in the right area that would give you the best coverage for your property). However, you can use an FSBO website, which will charge you a one-time fee to advertise your property with photos and full details supplied by yourself. They will also give you a For Sale board to place on your property. You should consider how people would contact you, ie a mobile phone number; FSBO sites will also give you a secure phone number. You would also have to think about how and when you would show people your property. If you work, you may need to take time off (if convenient) to show people around or restrict visits to nights and weekends. However, an Agent might escort people to your property (a good security aspect for you) or might have a key to your property so they can show people around during the day. Both would mean that you wouldn’t lose that potential buyer due to inflexibility. Once you have agreed a price with your buyer and instructed the Solicitors, then you will ‘Chain Chase’. See above what that entails!
However, you should be aware that you may not directly contact certain individuals in your chain (ie Lawyers outside of you and your Buyers). You may even find that your purchase lawyers are reluctant to talk to you, too! This is where an Agent is invaluable!
In conclusion,
I would say that FSBO sites obviously have their benefits as you are in control and your costs are pretty minimal. However, the benefits of using a real estate agent are quite significant. They can market your property in many different formats and therefore reach a broader cross section of potential buyers. They also have the experience and knowledge to monitor the progress of your sale.
Personally, I don’t think it’s a good idea to use both options, as I know some real estate agents will see this as a multiple agency type deal. They wouldn’t like the idea of using both, as there could be a dispute over who presented the buyer with the property, a potential minefield, obviously, if it was the seller, then they wouldn’t earn the commission!
At the end of the day, it’s your property, so choose the option that suits your circumstances and personal preferences.