buying and sell RE without an agent

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Submitted by gzz on August 10, 2017 - 1:54pm

Can anyone share their experiences and thoughts?

Here are mine. I did one SFH purchase completely without agents. I personally knew someone who was thinking of selling, and put in an offer about 10% below market. I thought I'd get a counter about 10k higher and accept it, but my initial offer was accepted. So a great deal.

The two selling points were I would accept as-is, no cleaning or anything needed, but especially no 6% agent fee.

The purchase contract and disclosures were handled by a mortgage broker (not one that I actually used for the mortgage) for a flat fee of $1500, which we split. The remaining paperwork was handled by the title/escrow agent.

For selling to the public, I see two routes. First is a discount listing agent who charges 1% and puts the listing on MLS. You would still need to pay a full buyer's agent fee, so your total savings would be 1.5%-2%.

Second, you could do FSBO. They charge $99 to be listed on their site + redfin. Zillow will either scrape the listing or let you submit it for free.

Or for $399 you can get on MLS. You have to list a buyer's commission, but I guess you could put in 0.1%. Either way, total savings of about 5 to 5.8% of the sale price.

The risk I suppose is that buyers agents won't want to show your house. But how many buyers of San Diego properties don't use the internet as their primary means of finding a place? Maybe someone getting a job transfer to here who does not know the area.* But in the current environment where properties placed on the market at market prices sell within a month usually, I am not sure I see the point. My 87 year old grandmother uses the net daily, including news, email, ebay, etc!

In summary, it comes down to whether you think agents will earn the 5-6% in the form of less hassle and higher price. For an uncomplicated million dollar listing, I just don't see that being the case for me or most other people. If anything, you can price 2% below the market and generate lots of extra interest and still come out ahead.

It terms of showing the place, that also does not seem much of a hassle and the seller will generally know the house better than the agent and could answer more questions.

*In my experience, people coming to San Diego out of state for high income jobs seem to cluster in a few areas like downtown, mission valley, banker's hill, CV, and new developments in North County Inland. People who have never lived here might not understand why so many people pay a premium for an older home in Mission Hills, Solana Beach, La Mesa, or Point Loma. So location could affect your decision. On the other hand, downtown condos and standardized CV developments are easier to find quality recent comps for that the more unique and varied homes somewhere like Mission Hills.

Submitted by gzz on August 10, 2017 - 2:09pm.

Good discussion of full v discount agents and FSBO this 11 years ago.

https://piggington.com/how_much_should_i...

Submitted by FlyerInHi on August 11, 2017 - 11:12am.

In today's market I think selling without an agent is easy. The buyer can pay his own agent if he wishes.

I would be perfectly comfortable selling without an agent. Most people wouldn't.

Submitted by matt on August 11, 2017 - 11:59am.

50k savings on a million - I could go thru some discomfort for that. Makes sense to me.

Submitted by sdsurfer on August 11, 2017 - 12:32pm.

For full disclosure I used to be an agent, but focus on other things these days and only use my license for my own investments for the most part.

I think in your instance everything you did makes perfect sense and seems logical since you knew the seller. If someone comes across that scenario is makes perfect sense imo.

Personally, I just want value being brought to the table whenever someone is paid in any profession.

If I was working with a buyers agent I'd say I want them to find me a place for a little under market (say 10%) and if I find it myself then they will not be paid since I found it. Conversely, I'd say if I'm a seller I'd list 10% above what I'm looking to get and let them know there will be no price reductions. I'd establish a realistic time-frame to give them a shot and if they do not sell it within that timeframe I'll be cancelling the listing. I might add an addendum that if someone that came through during the listing period buys after the listing period they must pay full list price in order for the agent to be paid.

The only reason I chime in here is that I think Realtors get a bad wrap a lot of the time. I think there are many good ones that deserve what they are paid, but there are others that do not. People tend to generalize on the value of the profession, but I do not believe everyone in any profession is equal. Some people just work harder and deserve to be paid and vice versa.

Cheers!

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