2011 Mar 20th

The Right Way to Sell Your Condo “For Sale By Owner” – Build a Bridge

What is the Problem with For Sale By Owners?calatrava bridge

“For Sale By Owner” are not the favorite words of the real estate agent.  Yet, to save the commission that they would have to pay an agent, some sellers choose to go “FSBO”, as it’s called.  There are two ways to do a FSBO.  One, is for the owner to do everything on their own.  The other, smarter way is for the owner to pay to have the property listed on the MLS and to be willing to compensate the agent who brings a buyer – a half-FSBO, if you will.  Both present some real challenges but, if done well, may indeed save the seller some dough.

I could list many mistakes I’ve seen sellers make when trying to sell on their own.  For example, the other day, I called a half-FBSO seller to make an afternoon appointment to show her condo to my buyer.  She asked if we could come after 6:30 at night because she works during the day and wouldn’t be home to let us in.  My buyer was meeting me at 1pm in the middle of the week to look at a number of properties.  She was not going to make a special trip to see this one FSBO unit at night when she could see all the others during the day.  Right there – the seller has missed an opportunity because of a lack of access to the property.  As I often tell my sellers – if the buyer can’t see the property they aren’t going to buy it.  That’s just one small example.  There are many others.  I am the first to admit many of the mistakes on this list are made by real estate agents as well as FSBO sellers.  That is a whole ‘nother article.  Of course I realize that not every item on this list applies to every seller but many do.  FSBO sellers:

There are lots of reasons why about 70% of properties that start out as FSBOs end up being listed with an agent when they don’t sell. I’ve read statistics that claim that properties sold with the representation of an agent fetch a higher price than those sold by the owner.  The differential might actually pay for the commission, and then some.

In today’s environment, there are a real number of sellers who bought at the height of the market and even if they were to do absolutely everything 100% right, no matter what, they are going to sell at a loss.  Sometimes it’s a big loss.  It is very understandable that they are going to try to minimize the loss and they often feel that saving the commission is a viable way to do that.  I’ve been involved with some of those sellers personally.  They have spoken with me about listing their property but decided for economic reasons they had to give it a try on their own.  When that is the case and the seller discusses it with me honestly and openly I can completely understand and empathize with their predicament.  In fact, I will do what I can to try to help them avoid some of the pitfalls I listed above.  That is the key, potential sellers – be honest.

If you think you can pick my brain and then try to sell your home on your own without me knowing, that shows how little you know about the Hoboken real estate market.  Hoboken is a small town in many ways.  If you are straight with me, or any other reputable, successful agent, they are going to respect you for it and be more than willing to help you.  Chances are, you may end up listing with them eventually so you shouldn’t be burning bridges, you should be building them.  (Calatrava’s pedestrian bridge in Bilbao is one of my favorites).

Posted by Lori Turoff | Currently 19 Comments »

2009 Dec 14th

A Strange Open House

Who is Selling This Hoboken Property?

I was out with some buyers yesterday looking at condos.  As usual, I searched the MLS, printed out the properties we were to see, made appointments with each agency and picked up keys at the various offices.  Midway through the morning, we were on our way to a particular property on the list, when my buyer noticed this sign in front of the building (I blurred out the address):

photo-2

What was so strange about it was that it looked like a “For Sale By Owner” sign.   Yet I had in my hand the MLS sheet for a listing from a reputable agency in town for the very same property.  The sign was clearly hand written, and lacked an agency name (as required by the real estate commission for agents).  There were no identifying names, no phone number, no agency logo, none of the usual trappings.  I thought perhaps the sign was for a different unit in the same building than the listing for which I had made the appointment.  It wasn’t.

Upon entering, we found the unit door unlocked and 3 men inside.  They welcomed us and invited us in.  I immediately identified myself as a realtor with my customers.  I called the agency and asked if they were holding an open house.  They said no.  While I was on the phone, one of the men picked up a stack of flyers from the kitchen counter, which I could see were property flyers, and shoved them in the kitchen cabinet.  I asked if one of them was a realtor but they said they were the owners.  Two of the three promptly left the premises.

We looked around the unit.  I opened the cabinet and saw that the flyer was indeed a “fsbo” style property flyer with no identifying real estate agency info and, this was even more strange, no price!

Now, every owner is certainly entitled to try to sell his or her own property without using a realtor.  My understanding, however, is that once an owner signs a listing agreement with an agency the agency typically handles the sale.  The agency does the marketing, makes the appointments and hosts the open houses.   The listing agreement specifies that even for a number of days after the agreement expires, the seller is obligated to pay the agency the agreed upon commission even if the seller finds his or her own buyer (unless a named party has specifically been excluded from the listing agreement when it was originally entered int0).

I wonder if the listing agent knew that these owners were holding their own open house with their own materials.  Why would they have their own sign and flyers (without a price) rather than use the agency’s?  What if they had found a buyer?  So what exactly was going on here?  Very strange indeed!

Posted by Lori Turoff | Currently 14 Comments »

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