Without a question, most people selling a home will not think twice about hiring an Agent when selling their home. It's just a common practice at this point and for most, there is no other alternative in mind. The perks of using an agent are clear, you have someone else take care of everything, but it does come at a cost. Depending on the cost of the home, that could be a good chunk of money for just doing paperwork and letting people see the home on Sundays. But what about those with lower cost homes or land that need all the money they can get? Let's dive into the other options..
Do you Really Need a Real Estate Agent?
While there are perks of using an Agent, giving you time to take care of normal day to day things without putting in work. You can sell a home or land without using one quite easily. It will take a bit of elbow grease, but that may be worth avoid all the agent fees taking your money from the sale.
To give an example, here at LandZero we used an agent once for a luxury community. She mailed us a letter, had an offer on some land we had from her client. Given this place was distressed due to the HOA and the land was only worth $3,000, we went ahead with it.
To our surprise, she took the majority of the money in the sale. We were left with around $600 total. Far less than the land is worth, needless to say, this was a mistake.
Closing without an Agent, what are the alternatives and why should you do it?
Now, with low cost land or a low cost mobile/home this may put a good amount of money in your pocket doing it yourself. You may be asking yourself, well...I don't know the first steps about this so it seems hard. Well, it's really not and you will be taking on professional help.
1. Listing your Home or Land without an agent
There are several ways to list your land without an agent, which will bring in buyers but also require you to either show the home or with land, give them directions. Here are some options.
- Zillow - On their website, you would go to the sell section and sell by owner. From there you can put up the description of the sell and pictures. You then verify yourself as the owner by a simple phone call and wait for potential buyers to call you.
- Other Listing Sites - You can use this same method on several sites like Redfin, FSBO, local ads and much more. The more you put it out there the better your chances are.
- Redfin - Now, say you want a bit of help but not the full fee of an agent, Redfin offers a way to sell your home with them for a flat 1% fee. You also only pay when it sells.
- Facebook - Surprisingly, Facebook marketplace is a major hub for home sales by owner. It also brings in a ton of interest from people.
2. Showing your Home or Land
When showing your home, you can do this a couple ways. One, you can be the one to give the tour of the home, but that requires some face to face contact and scheduled showings. Another option is a key box, just like an agent will use. Several agents just give key codes and people go see the home that way. You can use this same method, but it still takes some managing. You wouldn't want all your valuables in the home, but if it is empty then it's not as much of a worry. You would still want to check it and make sure someone isn't overstaying their welcome.
With land, anyone of course can just go look at it without worry. You would just offer some directions, the address or GPS if there is no address.
3. You have a buyer, now what?
This is probably the part you are most curious about, also this lets you close correctly and cut agent fees. For most people, there is no experience in closing property themselves. This takes things like understanding contracts, deeds, laws and escrow. But not to fear, if you are reading this you probably don't know these things but professional help is a breeze. Just about everywhere there are title companies in the area, just do a google search. You can also call First American Title, tell them your area and they will transfer you to the office that handles it. You simply tell the company you are working with, you need to close a as a for sale by owner. From there, they will get a purchase agreement together, take care of title, deeds, signatures and escrow. Basically this is all an agent does, they don't actually do that paperwork themselves.
This can run anywhere between $500 to $2000 for most properties. Sometimes they charge more to do escrow if they use an outside company.
If you are doing some low cost land, title insurance might not make sense. A lot of First American Title places and title companies won't do this without the title insurance because that is where the money is. If you are going this method, meaning the money is not a worry for them to pay you and you just need a deed. Contact a real estate lawyer in the area, they can usually just do a deed for around $200 and you pay the notary fee as well.
Savings can be big in almost all case, for low cost land there is always a base agent fee of usually $1500+. So if you are selling a $2000 property, you get only $500, was it really worth it?
A typical agent will take 6% of your sale, that is huge! To put it in perspective, with a million dollar home. You would lose $60,000 just for someone to show and sell your home.
It's quite simple, find your buyer and close with a professional company like First American Title, you can save a ton of money.
4. Have the seller pay closing costs
If you want exactly what you listed the land or home for, be clear with the seller they have to pay closing cost. Remember, here you are avoiding agent fees, they take directly from what you make. In some cases, a seller will pay closing costs anyway. So it's common place, they would just pay the bill to the closing company like First American Title. This will give you exactly what you asked for.
Hopefully this article gave you an idea of some options you didn't think you had. Thank you for reading and best of luck!