So, you need to sell your house. Selling in a market like today\u2019s can sometimes be frustrating. With so many other houses on the market it gives buyers out there more choices and oftentimes sellers can wait 3, 6, 12 or more months to sell their house for a price they feel is fair.<\/p>\n\n\n\n
This brief guide will walk you through the decision process to help you decide what\u2019s best for you. Do you go the traditional route and work with a real estate agent, sell it yourself (For Sale By Owner), or work with a real estate investment company?<\/p>\n\n\n\n
Each of these strategies have different pros and cons and each one will help you reach a different goal. It\u2019s for you to really look and see what you need to accomplish with the sale of your house … then make the decision that helps you get there.<\/p>\n\n\n\n
Like we mentioned above, there are 3 real options for you in selling your house. We\u2019ll dive into those 3 options a bit more below and spell out what\u2019s great about each … the drawbacks of each … and who each option is really going to help the most.<\/p>\n\n\n\n
The most popular way to sell a house today is by working with a real estate agent. The general process of working with an agent is:<\/p>\n\n\n\n
1 You contact an agent and they visit with you about your house to determine what they feel it may sell for.<\/p>\n\n\n\n
2 You sign a contract (commonly called \u201clisting agreement\u201d) with the agent (normally 6 months) where they exclusively represent and sell your property.<\/p>\n\n\n\n
3 Agent lists your property on the MLS, markets it, and takes buyers through your house for showings (a house should show well to sell well).<\/p>\n\n\n\n
4 If a property sells, the agent takes care of the paperwork and negotiation with the buyer. The agent collects their fee which is usually 3% for them and 3% to the agent that brought the buyer (so up to 6% of the total purchase price of the house).<\/p>\n\n\n\n
Agents know the market and have direct access to the MLS<\/strong> which is the main way houses are listed when selling the traditional route.<\/p>\n\n\n\n Cost:<\/strong>\u00a0Selling agent fees are usually about 3% of the total purchase price. The \u201cbuyers\u201d agent usually earns 3% as well (totaling 6% in agent fees). As an example, if your house sells for $200,000 you could expect approx. $12,000 of that to be paid to the agents at closing,<\/p>\n\n\n\n Timeline:\u00a0From 3 – 12 months (with an average of 6 months in many markets).<\/strong><\/p>\n\n\n\n Pros:<\/strong>\u00a0Agents know the market well, have access to the MLS to list your house to expose it to a broad range of retail buyers, they\u2019ll take care of the marketing, showing the property through open houses and putting together the closing documents.<\/p>\n\n\n\n Cons:<\/strong>\u00a0It can be expensive. An agent\u2019s commission is paid out of the proceeds of the sale at closing. Most agents tend to do \u201ctraditional\u201d marketing which often People who: aren\u2019t on a time crunch and can wait 6-12 months if they had to to sell, have room in the transaction to pay the agent fees, are looking for full market value and are willing to wait it out until a buyer comes along who is willing to pay full market price.<\/p>\n\n\n\n In the last 12 years \u201cFor Sale By Owner\u201d<\/strong> has become very popular. With sites like forsalebyowner.com<\/span>, craigslist.org<\/span>, and others like it, it makes it easy to list a house online, even get a \u201cFSBO\u201d<\/strong> sign for your yard … and hit the market taking control of the sale process for yourself.<\/p>\n\n\n\n The general process of selling a house on your own is:<\/p>\n\n\n\n This can be a very attractive option if you\u2019re familiar with the real estate sales process and are a good marketer.<\/p>\n\n\n\n Cost:<\/strong>\u00a0The only real costs are whatever fees there are to list on a FSBO site (between $100 – $1,000), if you choose to get it listed on the MLS with a flat fee agent (about $300 – $500), any cost to fix your house up so it shows well and potential closing costs that you may share with the buyer. Plus, if you decide to pay a buyers agent fee (usually about 3%) to entice agents to bring their buyers to see your house, want to figure that into the cost. Again, on a $200,000 house, 3% is about $6,000. Plus the other costs above and that is about $7,000 – $8,000.<\/p>\n\n\n\n Timeline:<\/strong>\u00a0This really depends on your ability to market the property. Usually FSBO houses stay on the market longer than with an agent, simply because agents sell homes every day and know the tricks to sell. But, you should budget 6-12 months to sell with this strategy in most markets (some more, some less).<\/p>\n\n\n\n Pros:<\/strong>\u00a0You can save a big chunk of money by not paying agent fees. And, you have control and full responsibility over the whole process.<\/p>\n\n\n\n Cons:<\/strong>\u00a0It\u2019s a lot of work to sell your own house, and if you\u2019re not comfortable and experienced in the process of selling a house, the paperwork, valuing your house, etc. you could end up in over your head and it costing you more than working with an agent. The largest drawback with going the FSBO route is the amount of time it could take to sell.<\/p>\n\n\n\n Who The FSBO Route Is For<\/strong><\/p>\n\n\n\n Selling your own house is really great for people who don\u2019t need to sell quickly and who have no urgency to get out of the house. Also, people who have a certain comfort level with negotiations, working with offer documents, etc. usually like this route. If you need to sell quickly and\/or don\u2019t want to hassle with everything that goes with listing and selling your house yourself … this isn\u2019t the strategy for you.<\/p>\n\n\n\n A third option for selling your house is to work with a local real estate investor who buys houses. In virtually every city there are independent real estate investors who buy houses and either: fix them up and sell them, hold onto them as a rental property, or sell them to other real estate investors who will hold them as rental properties. Every area has reputable investors who you can contact to work with.<\/p>\n\n\n\n The general process of selling your house to a real estate investor is:<\/p>\n\n\n\n The process can take from 7 to 30 days<\/strong> (many times investors can close within 7 days if you need it to). It is the option that many sellers go with when they need to sell their house fast with little hassle.<\/em><\/strong><\/span><\/p>\n\n\n\n Cost:<\/strong>\u00a0The cost to sell your house to a real estate investor is very low. There are no commissions or fees and often times the investor will actually pay for 100% of the closing costs as well. This immediately eliminates thousands in costs that you would have to pay when working with an agent or selling the FSBO route.<\/p>\n\n\n\n The main cost with working with a real estate investor is the fact that an investor can\u2019t pay full retail value for a house. They usually look to buy houses at discounts that allow for them of course to turn a small profit on the deal, just like any other business turns a profit. But, for many people selling at a lower price makes sense in return for the elimination of commissions and fee and the much faster timeline to sell your house.<\/p>\n\n\n\n What many people don\u2019t take into consideration are the \u201ccarrying\u201d costs when selling a house with an agent or the FSBO route. Carrying costs are all of the costs associated with owning and maintaining the house. The mortgage payment, taxes, insurance, utilities, HOA fees, etc. These can really add up. If your mortgage payment (including taxes and insurance) is $1,500 and you work with an agent and it takes them 8 months to sell the house at full market value … that means during the 8 months you paid $12,000 in payments on that house (which we all know most of your mortgage payment is interest going straight to the bank). Plus, you\u2019ll be paying the commissions, etc. So in the end, you could net in your pocket less if it takes a long time to sell your house with an agent for full retail value, versus selling very quickly to an investor at a discount today.<\/p>\n\n\n\n A similar situation we\u2019re all familiar with is, trading in your car to the dealership when you buy a new one. Most people trade in their car to the dealership to eliminate hassle and headache. We all know the dealership is paying a discounted rate and will turn around and sell your car for a markup and make a profit. But, because of the convenience and speed, it makes sense for you to sell it for less money in return for not having to worry about taking it home, spending money on marketing it, and trying to sell it yourself.<\/p>\n\n\n\n Timeline:<\/strong>\u00a0The timeline to sell your house when working with a real estate investor can be very quick. Since investors buy with all cash (they don\u2019t use conventional banks which take more time) they can close very quickly. Many times you can have an offer on your house in less than 48 hours and can close in less than 7 days from the time you accept it (sometimes it may take a week or two).<\/p>\n\n\n\n Pros:<\/strong>\u00a0It\u2019s less headache, you can have your house sold this time next week if you wanted to, no fees or commissions, many times the investor will pay all closing costs as well, and the closing happens at a title company just like with an agent making sure it\u2019s done correctly. In addition, most investors will buy your house \u201cas-is\u201d and won\u2019t require you to repair anything, clean anything up, or even remove everything from the house. They\u2019ll pay for those costs themselves after the sale is closed.<\/p>\n\n\n\n Cons:<\/strong>\u00a0Just like with anything, there are drawbacks. The main drawback may be that you are selling at a discount in return for the speed and convenience that a real estate investor is able to offer. If you\u2019re able to work with an agent and the agent is able to sell your house for full market value within 3 months (and you can wait 3 months) you may be ahead going that route, but if it takes longer than 3 months for the agent to sell it… the \u201ccarrying\u201d costs we mentioned earlier start to eat away at any gains you may have working with an agent.<\/p>\n\n\n\n Who Selling To A Real Estate Investor Is For<\/strong><\/p>\n\n\n\n This strategy is mainly for people who are willing to sacrifice a bit on the sales price in exchange for a fast convenient sale with no hassles. If you need to sell quickly (days or weeks rather than months), investors can close quickly. If you don\u2019t want to hassle with repairs or cleaning up the house, investors actually will take care of that for you.<\/p>\n\n\n\n Investors are able to get a good house at a fair price that leaves them room for a profit and you are able to get out from under the house and the payment and can move on more quickly.<\/p>\n\n\n\n Conclusion<\/strong><\/p>\n\n\n\n In the end, there\u2019s no one-size fits all solution. If you have lots of time and aren\u2019t in a hurry to sell, seriously consider going the FSBO route first to see if you get any bites. Then, if you still have lots of time (you don\u2019t care if it takes longer than 6 months to sell) you may work with an agent.<\/p>\n\n\n\n However if you need or want to sell quickly maybe you\u2019re in foreclosure, or you inherited the house and don\u2019t want to mess with the hassle of maintaining it, or you\u2019ve moving, or you already bought a new house and can\u2019t handle two payments anymore, or any other situation that calls for a fast and no hassle sale, working with a local real estate investor may be the way to go.<\/p>\n\n\n\n Just like with anything, do your research and make sure you trust the investor you\u2019re working with and make sure the actual closing is done at a reputable place like a title company. The vast majority of real estate investors out there are honest and do great business. Work with those ones, ask for references if you\u2019d like and trust your instincts.<\/p>\n\n\n\n Good luck on the sale of your house! We hope this guide will help you make sense of your options when selling a house and will help you move forward with what makes sense for you and your goals. In some instances working with a reputable agent is the best route and in some cases working with a reputable investor is the best route. Weigh your options and good luck! \ud83d\ude42<\/p>\n\n\n\n If you have questions about working with a real estate investor to evaluate how much your home is worth and what an investor will pay for your house, return to our website and contact us. We are a real estate investment company that focuses on helping homeowners reach their goals whether we buy your house or not we\u2019re on your side.<\/strong><\/p>\n\n\n\n We look forward to helping you as a resource and working with you on the sale of your home if there\u2019s a fit.<\/p>\n\n\n\n – ARG Home Buyers: <\/strong>Your local real estate investment company.<\/p>\n\n\n\n 1653 7th Street, #7454 sell@arghomebuyers.com<\/a><\/p>\n\n\n\n
takes 3-12 months to sell a house (in most markets the average time \u201con-market\u201d when listed with an agent is 6+ months currently). This of course means you\u2019re responsible for the costs of the house while it\u2019s trying to sell. Lastly, with agents their primary way to get buyers is by focusing on \u201cretail\u201d buyers (people looking to live in the home). This requires showings of the house and there\u2019s always the chance that the buyer who\u2019s offer you accept has their financing fall through, or delay the closing date.\u00a0One last \u201ccon\u201d is that many retail buyers will ask you as the seller to pay for part of the closing costs, so this is an additional expense in many transactions.<\/strong><\/p>\n\n\n\nWho Working With An Agent Is For:<\/strong><\/h4>\n\n\n\n
2) Selling Your House Yourself (FSBO)<\/strong><\/h3>\n\n\n\n
3) Selling Your House To A Real Estate Investor:<\/strong><\/h3>\n\n\n\n
Santa Monica, CA 90401
(424) 645-5858 Office, (310) 596-2308 Direct<\/p>\n\n\n\n