"For sale by owner" - SOLD? (Workshop)

[StillHope]

I was reading another thread which was going in this direction and I think this one deserves to be a separate topic.
(It could be a learning experience and the other thread is getting "personal").

Here's a quote from Rbakker:

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After reading the above postings I realize I have a lot to learn about real estate.

I also prefer doing it alone. I thought getting a listing on MLS could be done by anyone, and only cost $500 or so. Included is the availability on the web. I can make the sign myself.

Sure, if you don't do your homework, you may get burned. But saving $15K on a $250K house is worth putting in a few days' work. Or even a few weeks!

I don't cut my own hair, but I also wouldn't dream of paying someone to help me buy or sell my car. It's not that hard.

_____________________________________________________________________

In general,I probably would go with an agent.

I have one ? for now:

How the process of getting the money/title go if no escrow involved?

I mean ,literary - I handed you the check and you ran off with my title?[][][]


Disclaimer : I am not a RE agent,don't want to be the one and not selling my property.
(Though at one point I learned that all the expenses would come to 20% of the cost of my land)

[Youser]

Undoubtedly this has all been covered before, but perhaps in these trying times it doesn't hurt to discuss ways to save money.

I am sure the realtors posting here are competent and work hard, but I have found they are not absolutely necessary for buying/selling real estate. I am encouraged to hear from Mr. Rabi there are realtors who offer different packages at different rates and one can pay as little as $500 for their basic service. Fantasitc, this is even better than using MLS on your own and buying your own sign! I think Mr. Rabi's agency is the way of the future and I hope it survives the miserable downturn we are in now. 20% for fees and commission to sell a vacant lot of land means to me someone is being greedy and trying to profit off a simple transaction.

A few other points:

- One can find a real estate lawyer who will draw up necessary contracts between buyer and seller for less than $1000.

- Real estate agents are not responsible for escrow and in my case only recommended an escrow company. A buyer and seller going through escrow can deal directly with their escrow companies.

- Anyone can pay for a title report and title insurance. A real estate agent is not necessary for this transaction.

- While most people choose to go the escrow route, it is not a legal requirement - but it is a good way to park the money and make sure it's not released until the title is conveyed! But another 3rd party, e.g. lawyer can also hold the money and only release it when the change of title is recorded.

Those of us whose main careers were in the 80s and 90s must recognise the world is not the same today. My kids run rings around me on the computer and I would bet my house they are going to Mr. Internet first when they are ready to buy their first home. Realtors were probably invaluable when there was no world wide web but now the information is out there! You can get a lesson on how to buy and sell real estate, how to read a contract, how to read title documents, how to deal with escrow companies, what pitfalls to look out for, etc etc. It's all there, free and at your finger tips.

I have nothing against realtors and wish them all the best but I agree with a previous poster - a few days work can save a seller a lot of money.

And with the economy in the doldrums, isn't saving money any way you can a good thing?

[missydog1]

I have thought about FSBO. My Dad has done it several times in New Mexico.
I know my way around a purchase contract, but I have never dealt directly with an escrow company as their client.

I know that real estate agents here have relationships with escrow companies. If and when a contract is canceled due to a contingency, escrow fees such as title search have already been incurred. The escrow companies waive the fees due to the business they get from brokers.

Would they waive the fee for an owner? Probably only if the agreement to work with them states so. A standard contract allows for cancellation by buyer as late as the final walk through. So something to always think about in a transaction is, what happens when it goes south for some reason? Will there be costs?

Having two agents mediating between buyer and seller keeps many many contracts on track that would fall apart between buyers being scared of what inspections and disclosure reveal, and sellers nervous about financing -- or just people getting huffy and insulted while negotiating.

Then also if you list on the MLS you pay and if you don't offer 3% to a cooperating broker, no agent will bring your property to anyone's attention. Does that matter? More than you might think in this day of internet shopping.

I am an internet shopper, and have found each house I ever bought myself. I found our first house in the newspaper, before internet. But the people coming by to see my house are many of them looking at a list pulled by the agent according to their parameters. Maybe two people have found the house online.

Then there is advertising, expensive!
So I figured the best I could do was 4% over 6% (unless I shut out cooperating brokers), and the 2% wasn't worth losing all the networking, advertising, and SERVICE provided.
That's why I decided not to go FSBO, despite being fairly capable, although definitely less capable and experienced than the agents who are handling my property.

Anyone who does FSBO had better keep a really sharp eye on the contingencies and requirements of the timeline, or you can end up in a big legal mess.

[EightFingers]

"...20% for fees and commission to sell a vacant lot of land ..."

Guess I'll be keeping mine, then!

[John S. Rabi]

quote:

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Originally posted by EightFingers

"...20% for fees and commission to sell a vacant lot of land ..."
Guess I'll be keeping mine, then!

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Sorry, that's probably incorrect! Even with paying 10% commission the other closing costs shouldn't be more than 1%. Of course if you sell a residential lot for $5,000, pay 10% commission ($500,) pay for a full survey ($2,000) and pay for the escrow fees and title insurance ($700) than your total selling cost will be 65%! []

Aloha,
John S. Rabi, GM,ARB,BFT,CM,CBR,FHS,PB,RB
808.989.1314
http://www.JohnRabi.com
Typically Tropical Properties
"The Next Level of Service!"

[StillHope]

Thank you for the input,Youser.
I was going to post about John Rabi's firm,but you beat me to it.
I agree,that is the future of the business and John was call "the businessman of the year" (2003?) for a reason.

Speaking of John Rabi...He just posted something about MLS which is important :

" For those of you wondering, you can't put your property in MLS here, you would have to hire one of the brokerage companies to provide you with this limited service."

[StillHope]

About 20%.Sorry,I meant all the expenses (agent's fee included),not a broker's fee.

At the moment it was about 10K for 50K land.

But it really doesn't matter since I am not selling the land.

All this is interesting for me like taking a class at PW University.

[StillHope]

A ? for John Rabi (and others).
If the land has been already surveyed during the previous transaction( I believe it was about $700 -the seller paid),do I have to pay$2000 for another survey ? You said -full.Is there a partial one?

[missydog1]

StillHope,

whether a survey is required and who pays for it is part of the negotiation.
There is full survey, then there is staking, which means finding the pins, sometimes this is a lot of work though it they're grown over.

A buyer writing an attractive offer on a property where the boundaries are clear or recently surveyed will often waive staking if all pins are visible. This is written into the offer.

A Seller can counter on a requested survey and say no, I'm only willing to do staking, or say no, you're high, all the pins are visible. ( j/k [:p] )

I have never paid for a survey or staking when selling, and I have never demanded it when buying, but that's me. Some properties should no doubt be surveyed.

[John S. Rabi]

quote:

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Originally posted by StillHope

A ? for John Rabi (and others).
If the land has been already surveyed during the previous transaction( I believe it was about $700 -the seller paid),do I have to pay$2000 for another survey ? You said -full.Is there a partial one?

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Kathy already answered your questions, I just want to note that the $700 probably was just for a staking and not for a survey. The survey is much more expensive and includes a survey map with a surveyor letter to explain the survey map.

Aloha,
John S. Rabi, GM,ARB,BFT,CM,CBR,FHS,PB,RB
808.989.1314
http://www.JohnRabi.com
Typically Tropical Properties
"The Next Level of Service!"