Author Topic: How to sell a house without a realtor?  (Read 3987 times)

Aggie1999

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How to sell a house without a realtor?
« on: June 07, 2017, 10:20:58 AM »
I will be putting my house on the market in the next few weeks. I have contemplated trying to sell it without a realtor. How does one go about this from a contract perspective if the buyer also does not have a realtor? Who is going to produce the contract? What else is there to know/consider? I do understand if the buyer has their own realtor I will most likely still need to pay the buyer realtor's 3% commission.

A realtor my parents have used quite a bit has said he would look over any standard Texas realtor contract presented by a buyer realtor for $500. Said he needed to charge that for insurance/certification purposes or some such. Not completely sure of the details. My house is in the Houston, Texas area. Thanks.

frugaliknowit

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Re: How to sell a house without a realtor?
« Reply #1 on: June 07, 2017, 11:10:09 AM »
If you want to sell your house without a realtor (don't recommend it), you can handle the contract a couple of ways:

1.  Reach a verbal agreement, then just exchange attorney names.  Let them handle it.

2.  You could use a local realtor contract.  Make SURE it contains an "Attorney Approval Rider" within it (which means the contract is subject to the approval  of both attorneys within a set number of days...).  This way, if anything is screwed up, the attorneys will straiten it out.

3.  You could draft a "letter of intent" (I believe this is not binding), which basically just outlines the price, terms, etc.  Copies go to the attorneys to draft a contract. 

nouveauRiche

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Re: How to sell a house without a realtor?
« Reply #2 on: June 07, 2017, 11:25:59 AM »
I sold "by owner" about 20 years ago.  I had only been in the house a year and the realtor fees would have eaten up my down payment & small appreciation.

I was fortunate to have a realtor friend who had a real estate attorney friend who did the paperwork for me for $600 (IIRC). 

I had one open house, got one offer, and sold to those buyers.  I'm not sure what I would have done if the buyers had been working with a realtor.  I really didn't want to pay the fee.

historienne

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Re: How to sell a house without a realtor?
« Reply #3 on: June 07, 2017, 01:30:40 PM »
A realtor my parents have used quite a bit has said he would look over any standard Texas realtor contract presented by a buyer realtor for $500. Said he needed to charge that for insurance/certification purposes or some such. Not completely sure of the details. My house is in the Houston, Texas area. Thanks.

We've done two FSBO transactions.  For one, in a state where everyone pays a lawyer anyway, we had our lawyer draft the contract.  It was $750 total (IIRC), and her standard fee was $500, so pretty minimal extra investment.

In the second, when we bought a new house, we paid a flat fee to a local realtor for the contract and guidance in closing the deal.  That was $1000, but was worth it to us because he helped us negotiate repairs of about $3,000 after the inspection.  I don't think that we would have negotiated as successfully.

Lae1526

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Re: How to sell a house without a realtor?
« Reply #4 on: June 07, 2017, 06:15:18 PM »
In Texas, there are standard forms that can be used for the contract, and a title company can handle the other paperwork. I think the Texas Real Estate Commission publishes them, but they are pretty standard.
I also sent you a pm about your house, as we are looking for a house in a specific area of Houston (long shot). :-)

Beriberi

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Re: How to sell a house without a realtor?
« Reply #5 on: June 07, 2017, 07:41:27 PM »
Not available in every area, but I love Redfin (we've had three transactions).  They charge around 1.5% on the deal, instead of the standard 3%. 

LAGuy

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Re: How to sell a house without a realtor?
« Reply #6 on: June 07, 2017, 09:19:25 PM »
For my place, I just decided what I wanted/needed to get out of it then I added the Realtor fee on top of that my "bottom" price. Told my Realtor to have at it if he thought he could sell it at that price. Risk of all the marketing costs are on him that way. Personally, I thought that price was high even for the hot So Cal market, but he was hungry enough to try. Took awhile, but he got it done so I figure he earned his fee.

pagoconcheques

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Re: How to sell a house without a realtor?
« Reply #7 on: June 08, 2017, 07:32:00 AM »
We sold our house about a year ago without a realtor.  We were in an unusual position because we knew of a neighbor's friend who was VERY interested in a house in our neighborhood.  We contacted them and let them look at the house.  We then told them we planned to either rent or sell the house but hadn't decided which.  We also mentioned that we would be on vacation for a couple weeks and for them to think about how much they wanted to pay and get their money together.  We stressed throughout that we weren't even 100% sure we wouldn't just stay in the house a couple more years.  We did not disclose that we had already purchased our replacement home which is an apartment with a walk score of 96 (up from a walk score of 28)--we no longer have a car as it's all walking and metro/uber/ZIP car

After vacation we invited them to show us they understood the value of our house by making a reasonable offer.  They came in a bit low, we countered a bit high.  In the end we sold about 5% over market value and paid no realtor fees.  More importantly, we used an attorney we chose for the settlement (cost $1,000, which we split with the buyer), obtained a 15% non-refundable deposit (on a sale price well into 7 figures), and negotiated the deal "AS IS". 

We think we did well on the sale.  They might have paid a few grand more; we might have sold for a few grand less.  And we paid no realtor fees, so the total transaction cost was $500 for our share of the attorney fees. 

Aggie1999

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Re: How to sell a house without a realtor?
« Reply #8 on: June 08, 2017, 08:11:30 AM »
In Texas, there are standard forms that can be used for the contract, and a title company can handle the other paperwork. I think the Texas Real Estate Commission publishes them, but they are pretty standard.
I also sent you a pm about your house, as we are looking for a house in a specific area of Houston (long shot). :-)

Thanks. I found the forms:

https://www.trec.texas.gov/agency-information/forms-and-contracts

I may give selling it myself a shot. I've got the same standard Texas contract I used when buying the house. I can use that as a guide when reviewing any contract submitted by the buyer.

BTW, I responded to your PM.

iris lily

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Re: How to sell a house without a realtor?
« Reply #9 on: June 09, 2017, 11:33:58 AM »
Last year we sold a ittl eold house to the neighbors and didnt use a real estate agent. Our close friend is an agent, but frankly this little house would be more trouble than it is worth to him to sell it, so we didnt ask him to handle it.

We talked around a bit to tell a few people it was available, the next door neighbors made a cash offer using a standard form, we sold "as is" and the deal was done. All pretty simple. I think we paid the tirle company. It handles real estate transfers.

When it is a cash buyer  no mortgage company is involved and it reduces the need for negotiations, hence a simpler deal. Real estate agents earn their keep, thats for sure.

sobezen

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Re: How to sell a house without a realtor?
« Reply #10 on: June 09, 2017, 05:09:59 PM »
Not available in every area, but I love Redfin (we've had three transactions).  They charge around 1.5% on the deal, instead of the standard 3%.

Certainly agree Redfin and their refund marketing is enticing.  That said not all agents and realtors are created equal, some in my experience bring greater value for their clients than others.  I feel unless a seller is fully confident their property can literally sell itself because it is in a highly desirable neighborhood, it might be prudent to at the very least get a second professional opinion regarding the contracts negotiation/review.  There are many things that can go wrong during negotiation, offer review and the closing process.  Also, navigating the hard deadlines, coordinating with the various agents, inspectors, Title Company, etc, all takes time that you may not have due to other commitments like work.  In my experience unless you have specific experiences dealing with these types of matters, you may want to leverage someone else who has the time, background, and resources to do so on your behalf.  Good luck!

I'm a red panda

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Re: How to sell a house without a realtor?
« Reply #11 on: June 10, 2017, 11:53:37 AM »
We sold our rental to our tenants.
They had an appraisal done, we thought the price was fair, we met in the middle of the appraised value (that they likely would have paid with a Realtor) and what we would have netted with Realtor fees.  They paid less, we made more, win-win.

A real estate attorney did the closing. It cost a few hundred dollars.

chasesfish

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Re: How to sell a house without a realtor?
« Reply #12 on: June 10, 2017, 02:23:17 PM »
Following. Trying g to decide if I should sell my house myself (to an investor most likely) or use a realtor due to it most likely ending up as a teardown. https://forum.mrmoneymustache.com/real-estate-and-landlording/selling-a-tear-down/

Similar situation, I plan on putting together a list of all the builders in our neighborhood and call them all.  There's also the chance someone downsizing would want the house, same neighborhood but doesn't want the McMansion.

boarder42

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Re: How to sell a house without a realtor?
« Reply #13 on: June 11, 2017, 08:41:55 AM »
Every state has standard documents for this it's not too hard to do

freeat57

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Re: How to sell a house without a realtor?
« Reply #14 on: June 11, 2017, 11:27:09 AM »
In Texas, there are standard forms that can be used for the contract, and a title company can handle the other paperwork. I think the Texas Real Estate Commission publishes them, but they are pretty standard.
I also sent you a pm about your house, as we are looking for a house in a specific area of Houston (long shot). :-)

Thanks. I found the forms:

https://www.trec.texas.gov/agency-information/forms-and-contracts

I may give selling it myself a shot. I've got the same standard Texas contract I used when buying the house. I can use that as a guide when reviewing any contract submitted by the buyer.

BTW, I responded to your PM.

I just did this in Texas at the end of 2015.  It was easy and there were no problems.  Just get the forms and make arrangements with a reputable Title company. 

boarder42

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Re: How to sell a house without a realtor?
« Reply #15 on: June 12, 2017, 06:01:55 AM »
Every state has standard documents for this it's not too hard to do
Well I AM lazy soooo ;-). But seriously, I have sold 2 places (using a realtor) that were bought with cash so no mortgage issues but still the amount of paperwork was pretty overwhelming - and that was with the realtor and escrow company drawing up and handling everything. Add in that I live an immigrant hood without a lot of native English speakers and a high value property (over $500k just in land value) so I'm a bit afraid of screwing something up.  I think I'd rather just put it up for sale and go on a trip while its up for sale and let someone else handle it all. Not very mustachian but...well...did I mention I'm lazy ;-).

you must be extremely lazy b/c the avg real estate agent fee is around 6% ... at a 500k house that 30k thats probably more than most spend in a year around here and thats what you're giving up

Another Reader

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Re: How to sell a house without a realtor?
« Reply #16 on: June 12, 2017, 06:25:00 AM »
"you must be extremely lazy b/c the avg real estate agent fee is around 6% ... at a 500k house that 30k thats probably more than most spend in a year around here and thats what you're giving up"

If you do not put the property on the MLS, you are not receiving full market exposure.  You want buyers in a highly competitive market with a shortage of inventory to bid against each other to maximize your price.  In Spartana's case, she is likely to be approached by investors that will lowball to take advantage of her lack of knowledge and experience if she tries to sell it herself.  A good understanding of the actual value of the property, considering its' development potential, will help, but she is still swimming in a sea of investor sharks.  Getting the property on the open market and being represented by an agent experienced at selling this type of property that will sort through all the garbage offers and insist on top dollar may save her more than the cost of representation.  She should also be able to negotiate a lower commission percentage, and a good agent should negotiate commission.

boarder42

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Re: How to sell a house without a realtor?
« Reply #17 on: June 12, 2017, 06:32:23 AM »
"you must be extremely lazy b/c the avg real estate agent fee is around 6% ... at a 500k house that 30k thats probably more than most spend in a year around here and thats what you're giving up"

If you do not put the property on the MLS, you are not receiving full market exposure.  You want buyers in a highly competitive market with a shortage of inventory to bid against each other to maximize your price.  In Spartana's case, she is likely to be approached by investors that will lowball to take advantage of her lack of knowledge and experience if she tries to sell it herself.  A good understanding of the actual value of the property, considering its' development potential, will help, but she is still swimming in a sea of investor sharks.  Getting the property on the open market and being represented by an agent experienced at selling this type of property that will sort through all the garbage offers and insist on top dollar may save her more than the cost of representation.  She should also be able to negotiate a lower commission percentage, and a good agent should negotiate commission.

you can pay very small fees to get your house listed in MLS

Another Reader

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Re: How to sell a house without a realtor?
« Reply #18 on: June 12, 2017, 06:43:08 AM »
"you must be extremely lazy b/c the avg real estate agent fee is around 6% ... at a 500k house that 30k thats probably more than most spend in a year around here and thats what you're giving up"

If you do not put the property on the MLS, you are not receiving full market exposure.  You want buyers in a highly competitive market with a shortage of inventory to bid against each other to maximize your price.  In Spartana's case, she is likely to be approached by investors that will lowball to take advantage of her lack of knowledge and experience if she tries to sell it herself.  A good understanding of the actual value of the property, considering its' development potential, will help, but she is still swimming in a sea of investor sharks.  Getting the property on the open market and being represented by an agent experienced at selling this type of property that will sort through all the garbage offers and insist on top dollar may save her more than the cost of representation.  She should also be able to negotiate a lower commission percentage, and a good agent should negotiate commission.

you can pay very small fees to get your house listed in MLS

...being represented by an agent experienced at selling this type of property that will sort through all the garbage offers and insist on top dollar may save her more than the cost of representation.