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4 Ways to Sell Your House
Dated: May 5 2020
4 Ways to Sell Your House
Whether you are moving to another part of the city, or you inherited a house, there are many ways to sell it. Some are good, and some aren’t, which means that you have to be very careful when you are selling your house.
Pick the wrong way or do something wrong and you will be left with no house and little money, basically you will be left with nothing (or not much) to show for it. In many ways the methods that are selected in this short list are the best, although every technique has its own pros and cons.
Selling a house at an auction can prove to be very profitable. An auction is an advanced method and it is great tool for quick sell with the least amount of hustle.
There are a few different types of auctions. Normally there are multiple buyers bidding for the house at the same time and whoever offers the most money wins the house. Typically, the auction is announced with 2-3 weeks’ notice.
In those few weeks it is standard practice that 1-2 days are reserved for open house preview. In those couple of days, people can come to the house, check it out and see if it meets their needs. It is pretty logical, because there would be no sense in bidding on a house that you have just seen for the first time several minutes prior to the start of the auction.
Before even thinking about yelling ‘SOLD!’ you have to contact an auctioneer.
It is very important to choose the right one. They will advise you about the value of the property, the guide price and the reserve price. The guide price is an indication of what the house’s reserve price is, although it isn’t necessarily the figure the property will be sold.
The reserve price is the bare minimum you are willing to accept for you property.
This is a method that will prevent you from losing money or be left with less that you were hoping for. If the reserve price isn’t achieved, you won’t have to sell the house. You are only obligated to sell if the reserve price is met.
Everything should be prepared at least a week before the auction. You can sell the house with all the things inside, like furniture, but be sure to take everything you don’t want to sell.
You don’t want to lose your precious memories, and it is highly unlikely that new buyers will ever use your already used towels. Selling what was once your home can be tough, so make sure you really want to do it.
The most important this is to be absolutely sure that you want to sell the house. Once the auction starts it will be almost impossible to win the house back, unless you bid higher than anyone.
The auction usually takes place at the house that is being sold. Before the auction can actually start, all the potential buyers (the bidders) are require to register and prove that they can pay for the property. You wouldn’t want to sell your house to a bum.
That’s why all bidders show that verified funds are available as a deposit if they win. Once the auctioneer starts bidding, all you can do is watch. Whoever bids the highest is the winner.
They sign the purchase agreement and submit the deposit. Your house is sold before you can yell ‘SOLD’ …well unless you are an auctioneer – we know how fast they speak.
If buyers let emotions take over, the bidding war can be fueled by them and drive the price very high. Competition and ego often burst emotions. Nobody wants to lose so everyone just keeps bidding.
People get caught up in the auction and end up paying far more than the actual value of the property.
The house is sold ‘as-is’ so no fixes and repairs are to be done by the seller. You can also leave anything that you don’t need, anything that you can’t be bothered with, and it will be sold with the house. Other than repairs, you also won’t have to worry about city inspection, that’s also the buyer’s problem.
There are hardly any contingencies and the deposit is often fairly high. The buyer will not have a way out of the contract and will have to deposit at least 10% of contract price or $2,500 immediately after the auction.
If the property isn’t closed on in 30days or less, the buyer forfeits the deposit, which will ensure that only serious buyers apply for the auction.
The biggest downside of an auction is that it is unpredictable. The outcome is uncertain and you can be left with much less than you were hoping for.
Fortunately, this can be prevented by setting a reserve price. Also, you will have to hire a skilled professional, and skills come with a price
Sell to an Investor
There are many top-notch real estate investors in almost every city. They are always on the look for a new purchase, therefore, you should be able to find one rather easily.
There is always something to beware of, and in this case it’s scams. There are many scams, which means that you need to find the right investor in order not to get ripped off. When the right investor is hired, typically one of his agents (or himself) will come and check out your house.
They are going to ask you a few questions about the house and give you a quick appraisal. Sometimes this process can be done over the phone, without having to meet. Real estate investors buy properties in order to make some cash, and you should always keep that in mind when you are selling to an investor.
They often buy houses that need to be sole as quickly as possible. The houses are then repaired, everything is restored and it is sold for far more money than it was bought for. That’s why most of them are trying very hard to get lowest price possible when purchasing the house.
As it was mentioned earlier, some will even try to scam you, but that is why it is very important to hire an investor that is reliable and professional. Selling a house to an investor shouldn’t really be you first choice.
It is only a primary choice if you’re within only a couple of days, and you can close the deal within a week.
It will almost always be quick and painless. Additionally, you won’t get any unexpected, hidden fees and commissions. Investors make cash from selling the property, so you won’t have to think about losing money on this kind of deal.
One of the biggest perks of selling a property to a real estate investor is that they will buy it ‘as is’. If the house is bought in ‘as-is’ condition, you won’t have to do any repairs by yourself.
Additionally, the investor is much more likely to buy a house that needs lots of repairs than the average buyer. An average buyer wants to move to the house and use it as soon as possible. The investor wants to give it a makeover and sell it for a profit.
Sometimes the investor won’t even have to see the house because he intends on flipping it, so the deal can be made very efficiently.
A more dependable and quicker closing is also what comes from selling to an investor. In many cases, the deal can fall apart if the buyer suddenly runs out of money.
There are many reasons why this can happen, one of which is the very nature of the investment business. It can be very risky from time to time, and when the buyer backs out of the agreement, the seller can be left with nothing except for the house that he already wants to get rid of.
Many months can be wasted, and while the buyer wasted your time, you will have to spend money on stuff like insurance, taxes, mortgage, etc. Cash closing will prevent this from happening.
Even if the buyer runs out of money and he backs out of the deal, you will be left with the deposit, which means that your time won’t be wasted after all. Other than being quick and dependable, selling to an investor can spare you of further fees and commissions.
If the deal is made without an agent, you can save on the commission, which often 6% of the selling price. That can add up to quite a big number, depending on the property you sell.
There are many other fees that show up in the fine print which you probably won’t even know you are paying for, but this can’t happen if you sell to an investor. By selling the house “as-is”, you will be able to leave all the unwanted stuff in the house.
Everything you don’t want in your new home can be left in the old one, and the investor will buy the whole package.
There aren’t many cons when it comes to selling to an investor, but the one that exist can sometimes make your regret contacting an investor.
The fact is that they try to make a profit from reselling property. In order for them to succeed in this, they will always try to buy the house for the lowest price possible.
I’m not saying that all of them are dishonest, but many will offer you less than the actual value of the house.
Many will use devious means in achieving their goal. That is almost no chance you’ll get full value for your home in this situation. It’s not suggested to sell to an investor unless you are in a dire situation.
For Sale by Owner
This method is by far the most unreliable and riskiest on this short list. For Sale by Owner means that you are selling your property by yourself, without any help from professionals.
This means that you won’t be hiring a licensed agent which, in most cases, proves to be a mistake. People want to save money on commission and fees, so they take this step into the unknown.
How hard can it be? Let me tell you that it can be very hard.
There is a reason professionals exist and, if they were useless, people would stop hiring them. If everybody could do their job, there wouldn’t exist the need for a professional real estate agent.
However, if you decide to sell yourself, there are certain preparations that need to be made. First of all, try to focus on web marketing. The best way to attract as many potential buyers as possible is through Internet and social media.
You will have to appeal to great number of people so that a lot of offers are made.
You should also repair everything in your home and put everything in order, so that the photos attract many potential customers. Making sure the price is right will ensure that you don’t lose money.
This means that you will have to do a lot of research and hire an appraiser. To make sure you don’t get hustled, you will probably have to hire a lawyer, too. Hiring all these people will make you wonder if this is really a way to save money.
You may be able to save money on commission and fee, but that won’t guarantee you the profit that you expected.
First of all, without an agent the house might not get enough market exposure and advertising. This is essential if you want to attract buyers. Without the help of a professional you might not be able to evaluate the property correctly.
If the price is too high, no one will want to buy it. Too low and you will be left with less cash than you expected.
This method is very time-consuming. It will take a lot of time to research the market, to advertise your house, and to make an appraisal.
You do everything by yourself and you have to pay attention to every detail.
In the for-sale-by-owner scenario nobody has your back. There are many things that can go wrong and if you are alone in it, you will have a really tough time.
You won’t know if you’re being scammed, you won’t be able to cope with the buyer if he is a skilled agent and you probably aren’t familiar with the real estate laws. There are so many more cons than pros when it comes to selling a house by yourself, therefore I wouldn’t recommend it.
Hiring an Agent
The most common way of selling a property is to hire an agent. This might also be the safest and most reliable way. The way it works it that you first have to sign a listing agreement with an agent.
The contract entitles the agent to a commission, which is usually 6% of the sales price. When this is done, the real estate agent will advertise the property. This way, many potential buyers will notice the house and possibly make an offer.
When an offer is made, you don’t automatically sell and get the money. There is a process between getting an offer and receiving the check, and the agent is here to guide you through the process.
They will navigate the negotiations, appraisals and possible repairs. They do almost everything and you just have to sit back and relax.
Many listing agreements will be an “exclusive right to sell the contract” which means that regardless of who finds a buyer, the agent will get the full commission.
Once the contract is made with the buyer and the property is sold, the agent gets paid and you can forget about the house.
If you think that you could do this all by yourself and save some money, think again. Many people are trying to save as much as they can, and realistically, who wouldn’t want to keep that 6% for themselves.
Do the math and it can be a lot of money. It can make you think that is worthwhile to spend time and energy on something like this.
Nevertheless, the reality of the process is much different. Other than wasting your time and energy, you might also be spending more money than predicted.
By doing everything alone, you pay for every service, every professional, you pay for everything. Agents know the cheapest way to make things happen and they know the most effective way to sell your house.
Their payment depends of their work, so you can be sure you’ll get the best service.
By hiring an agent, you will have an experienced professional to advise you and guide you through the whole process of selling the house. He will manage all the paperwork and do all the stuff you never knew had to be done.
Agents have tools and resources that simply aren’t available to the general public. It’s a part of their job.
Those tools help them sell your house effectively, by analyzing the market trends and pricing the house accordingly and by projecting how long it will take to sell the property.
Agents will list the house on the marketplace known as multiple listing services (MLS).
This is the best marketplace for leasing and selling properties, and only agents have access to it. Only real estate agents can list a house for sale on the MLS, and it is the most powerful and influential way to make the property available to the masses.
One of the best things about hiring an agent is that he can really highlight the best qualities of the property that is being sold. If there is something that needs to be repaired or altered, the agent will be able tosee it. This will help you sell the house faster and it will help increase its value.
The commission fee is the only negative, but most of the time you’ll save more in the long run working with an agent.
For the majority of people, the purchase or sale of a home is their largest single investment. My goal is to guide you successfully and easily through the contractual, investment and emotional decisio....