Used to be that there were only these two choices, today we can add a third, Fee for Service. Before you choose which method is best for you lets' look at the advantages and disadvantages of each.
Trying to sell your own real estate only offers one advantage, you may save money in the short run. The disadvantages are many, how do you set the right price, what improvements can return more than they cost, how to you expose your property to prospective buyers, how do you control the access to your home, how do you qualify prospective buyers, what are the advantages and disadvantages to various financing programs, how do you create a purchase contract, how do you choose service providers, what disclosures must be legally made to the purchasers, what repairs or modifications are required by local ordinances...
Statistics tell us that over 70% of owners who try to sell their own homes eventually rely on the services of a Realtor. The experience and local knowledge provided by real estate professionals worth the investment.
By now you've probably convinced yourself that your time and peace of mind are worth the fee charged by a professional. Selecting an expert to handle your sale is a daunting task. Everyone is "Number 1" this or a "Top" that or a "Multi" something. What matters is not advertising jingles, it's the personality and knowledge that your agent brings to you. Interview a few agents, look beyond the car and the wristwatch. Do these people have the knowledge and confidence to earn your trust. Are their (and your) expectations believable? Remember, if it sounds too good to be true, it probably is. The purpose of this is not to find the agent who says the home will sell for the highest price, but finding the agent that you can communicate with and who understands your needs.
Relatively new on the real estate scene is the concept of "Fee for Service". The entire process is broken down into tasks and the client can pick and choose among the services they wish to receive.
Once you've decided to use a RealtorŪ your questions will boil down to How Much and When. Your professional will consider general market conditions and specific comparable sales information (Comps) to arrive at a realistic price range that the property should be listed at and an idea of how long the process should take.
If there's something that can be more of a hassle than buying a home it is selling one. The pressure maintaining a showroom appearance, showings during awkward times and having "strangers" being in your house all lend themselves to the frustration many home sellers experience.
This axiom often holds true. The reason that buyers that have been shopping for a period of time are mature in their knowledge of the market. They may have already made offers on other homes and perhaps lost a home that they really liked. After such an investment of time and effort, when they see a home they like (yours, just listed for sale) they make a very decent offer in order to buy it. On occasion, homes are under contract within days of the For Sale sign going up in the yard.
Has the agent done their job? You expect your broker to sell shares of stock in seconds yet somehow an agent who sells a house in "only" a week doesn't seem to earn their money. Of course they've earned their money. A doctor writes a prescription that cures that embarrassing itch in a couple of minutes. Did she earn her money?
Offered Price, length of the contract, any seller concessions, other conditions, any warranties or other contingencies need to factored into the evaluation of the offer. Your agent is invaluable in this process. Any offer that is presented should include an estimate of net proceeds to the seller. Many intangiblies also need to be evaluated with offer including the reputation of the buyers agent or brokerage. Again, an agent can pay for themselves here.
Having multiple offers makes things very interesting. A common misconception is that the same counteroffer must be made to all buyers, this is not true. Based on the relative strength on the offers, writing different counter offers is nearly mandatory. Your agents personal knowledge of the market and any cooperating brokers should guide you here.
Once the offer (or offers) have been presented to the seller the real fun begins. The seller has three choices, he can accept it as written (this is the worse for the buyers, they will think they paid too much), he can reject it (this is the result of either the seller or the buyer not being realistic), or he can Counter the offer (most likely).
Counter offers can be numerous, it is not unusual to have two or three Counters. Our practice is to write as many as needed to better define the wishes of the principles. Once we have a meeting of the minds, then we'll rewrite a contract to incorporate all the various clauses into one contract. This is done to make the transaction clearer to all involved and to save a tree or two.
Once the offer and any counters are accepted by the seller and delivered to the buyer it's time for the buyers to experience Buyers Remorse and the sellers to suffer Sellers Remorse.
Buyers Remorse takes many forms and stems from the fact the buyers are uncertain that they made the right decision. Sleepless nights and petty bickering are common symptoms. Nagging doubts about every aspect of the purchase are very common and your RealtorŪ doubles as a physiologist during this time (and you thought this was an easy business).
Sellers remorse has similar symptoms and stems from the realization that sellers are really going to move and leave family and friends behind or that they sold too cheaply.
In any event, neither of these afflictions last too long. The deal has been struck and there's lots of work to do.