Who wants to make a six-figure sale, only to hand the lion’s share of that money over to the bank and agents? You might sell your house for $100,000, but you won’t see nearly that, even if you have decent equity. You have to consider that:
- A good portion of that sale pays off your remaining mortgage balance with the bank
- You have to pay a commission to the real estate agent
- If the house fails inspection, you’re on the hook for those necessary repairs
- Finally, you have to pay closing costs
The amount of money you’ll actually see depends on your level of equity and the current condition of the house. Realistically, you just hope it’s enough to put a down payment on a new house.
There has to be a better way, right? Resourceful people have been cutting out middlemen for centuries, realizing better gains for themselves. There is no reason someone with enough time and energy couldn’t bypass the real estate agent, and perhaps the bank, and sell a house independently.
The good news: you absolutely can sell your house privately. It takes a little work, and you might not gross as much as you would selling your house with an agent. But why would you care about gross? The money in your pocket should be your only care.
For Sale By Owner
Drive through a few neighborhoods and you’re bound to see a sign reading “for sale by owner” on someone’s lawn. It sounds like a great deal. The owner can sell the house privately, and therefore not pay any commissions or fees to an agent. What’s not to like?
There’s plenty not to like, when you get down to it. For starters, do you understand the basics of real estate? Do you understand the nuances of the local market? There’s little sense in avoiding commissions and fees if you underprice your house. If you’re inexperienced enough you might leave more money on the table than you would have if you’d paid an agent.
Now consider this. You drove through the neighborhood and saw the sign. How many people in the market for a new house drove by and noticed the sign? They’d have to be looking specifically for a house in that neighborhood. That limits your number of prospects (forget anyone from out of town). That is, unless you spend on advertising. Which, of course, costs you money. An agent has an incentive to sell your house, and so will provide much of that advertising.
Do you know how to qualify a buyer? People love to go house shopping. It lets them play pretend for an afternoon. Many of the people who see your sign will just want to look at the house and feel better about themselves. That does you no good. You’re wasting your time with someone who will never buy your house. Even if you find an interested party, do they have good credit? Can they get financing?
Let’s not even get started on drawing up the contact and accounting for concessions.
Real estate agents make a decent commission, but that’s mostly for good reason. They’re letting people know that your house is for sale, they’re getting people in to look, they’re handling the contracts. Even if you’re in an ultra-competitive market where listings are coming down after a couple of days, an agent can make sure you’re getting top dollar and the best overall deal possible.
I never want to discourage anyone from doing things themselves and cutting out the middle man. There’s something of the American spirit in there. But I also don’t want to see people put themselves in bad spots because they got in over their heads. Unless you have a background in real estate, going the For Sale By Owner probably isn’t the best route.
(That said, FSBO can be a great way to gauge interest. You lose little by putting out those feelers. Give it a whirl, but don’t depend on it, and don’t enter into any agreement without doing more than your share of homework.)
Sell your house privately to an investor
At this point some people will be scratching their heads. They’d still rather sell their houses privately, but understand that going the FSBO route might not be the smartest move. Thankfully, there is another option. Real Estate Investment groups such as Houston House Buyers operate on a private basis. We deal with you, one on one.
Our house buying process is painfully simple. You call us, and we come over to take a look at the house. We’ll evaluate it based on a number of factors, including current condition, neighborhood, and market trends (both generally and specific to your area). We’ll then make you a 100% cash offer.
Maybe we don’t make you an offer you like. That’s fine. You’re under no obligation to sell. Only the scammiest company would pressure you to sell when you don’t want to, anyway.
But at least you have an offer in hand. You can use that to get a decent offer selling your house yourself. Or you can figure out how much you’d need to sell for, factoring in agent commissions and fees, to make more than our offer. That’s your decision.
I think you’ll like our offer. Consider that you:
- Don’t have to make any repairs. Imagine losing a sale because you didn’t pass an inspection. Imagine buyers lowballing you because they want granite countertops or stainless steel appliances. With real estate investment groups like Houston House Buyers, you don’t do a thing. We buy your house as it is.
- Don’t have to pay commissions and closing costs. The offer is the offer. When you accept it, that’s what you get paid. It removes a lot of the complication.
- You don’t have to worry about concessions. When you sell your house with an agent, oftentimes the buyer will need concessions. You agree to fix this or that. Or worse, the sale is contingent upon the buyer selling their existing house. Again, our offer is our offer. We exchange the deed for money.
Those are the two ways you can sell your house privately. Both have upsides and downsides. With FSBO, you’re on your own in a difficult, complex situation. With a real estate investment group, you’re not going to get the same price as your next door neighbor did selling with an agent.
There are upsides to both, too. It’s your choice to make. But you do stand to lose nothing by giving us a call and going through our process. Who knows? Maybe you’ll find the offer is exactly what you’re looking for.