SELLING A HOUSE PRIVATELY VS AGENT
Each month, around 4,000 buyers actively search for houses for sale privately - because they are after a bargain.
Private home buyers will push for your lowest sale price - not only because you have avoided paying real estate commission, (which should be your gain not theirs) but because you're unlikely to be a tenacious negotiator. They will assume you have a minimum you are prepared to take.
Property sales throughout the regions continue to achieve record sale prices, many by hundreds of thousands above their RV's. Why would you limit your opportunity to prosper from your property sale?
This effectively hands over the equity you could gain, to your buyer.
MOST EFFORT NEEDED TO HELP YOUR BUYERS
Most property sales completed on time, to a high standard that achieve at a premium price almost always require 'the seller's' real estate agent to liaise with numerous organisations (bulleted below), to help buyers complete purchases - within short timeframes.
If it was left up to buyers alone - many sales would not complete at all which is why many private sellers end up listing with a real estate agent - because they don't have the relationships, knowledge or experience to know what is required from these organisations.
We have rescued many private sellers over the years.
There is a professional methodolgy that when managed well, can achieve premium sale prices:
- A tailored marketing strategy that targets 'qualified' buyers locally, regionally, nationally and internationally - dependent on the location, property type and value.
- Choose an appropriate 'method of sale' that drives a high volume of interest and buyer competition.
- Choose a real estate agent who has been proven competent, has the tenacity and confidence to negotiate for more when others will stop earlier.
- Choose a real estate agency that manages AML, legal responsibilities, coordinates with banks/mortgage brokers, building inspectors, EQC, valuers, insurance companies, councils and lawyers to name a few.
When selling a property, your situation may be straight forward - but buyers' want numerous reports - for example: on a property's value, building condition, weather-tightness, underground utilities, easements, alterations and codes of compliance and insurance.
Selling a houses privately is certainly not a job for the faint hearted.
Liaison with multiple organisations, obtaining all reports to meet conditions and solving problems - all in tight timeframes is what real estate agents do. And then there is the settlement period to sort.
It is understood that on average, New Zealanders sell only five houses in their lifetime so every sale is an opportunity to gain equity.
Find out how to sell your house for more.
METHODS OF SALE CAN DRIVE PRICES SKY-HIGH
Methods of sale cleverly managed to leverage buyer competition and using real estate agents with tenacity and substantial experience are what primarily drives record-breaking results.
Now is an optimum time to sell but unlikley for those selling privately.
You can use these latest Real Estate Institute statistics to establish what houses are selling for in your area. Less that 10% would be sold privately.
Find out what real estate commission and fees cost.
OWNER RESPONSIBILITIES IF SELLING PRIVATELY
Firstly, the consequences of not fully understanding the information contained in (or omitted from) a sale and purchase agreement, legal clauses (that protect you), amendments or other legal documents such as a Certificate of Title or building inspections can be far reaching.
If you withhold information or (unknowingly) misrepresent particulars about your property that private home buyers should legally be made aware of, you may put yourself at risk of legal action.
If choosing to sell your house privately, be warned that legal responsibilities, (mis)information, documentation collation and interpretation are your responsibility. There is no come back if it goes wrong.
Over the years a number of people have contacted us for vetted real estate agents following an unsuccessful private sale - disillusioned and desperate to sell at almost any price. It never has to be like this and especially in this market.
BACKING OF THE REAL ESTATE AUTHORITY
If buying or selling a house using a licensed real estate agent, you have the backing of the Real Estate Authority should things go awry.
Better still, if you use a vetted real estate agent, you might be amazed at what difference it can make.
Among pitfalls could be information omissions, clauses and amendments, errors, unmet deadlines and unverified property-specific information. Anti-money laundering administration is also now required.
CONDITIONS OF SALE FOR A PRIVATE SALE
Many people think selling a house just requires a sign at the gate and showing buyers through the property and voila.
However, the part of the process that is most challenging is the period between the date the sale and purchase agreement is signed and the unconditional date.
If real estate agents didn't multi-task during property sales, many would fall over.
SAVVY BUYERS GOING OFF THE BOIL
Property buyers are well researched, savvy, seek due diligence and expect a quick turnaround time for information they have requested. If it's not provided quickly, they can go off the boil. They are likely still viewing other properties so time is always of the essence.
Be mindful that yours is not the only house they will be looking at. Timeliness is as important as quality.
Selling a house requires 'expedited project management'
WILL SELLING PRIVATELY SAVE YOU MONEY?
The financial value of a vetted, competent real estate agent can equate to tens of thousands more in a sale price, compared to any commission you were trying to save.
Before you decide whether to sell your house privately or not, find out what real estate costs are and how you can keep commission and other fees to a minimum. Obtaining a free property appraisal first might help you make that decision.
Negotiating a prime sale price is not every real estate agent's forte. If you do decide to use an agent, use a vetted one - it's the safest way to choose a real estate agent - and Agent Finder NZ offers this as a completely free service.
A successful real estate outcome has a lot to do with a planned, coordinated and managed legal process by a competent, licensed real estate agent.
Request a shortlist of vetted real estate agents to compare - It's a genuine free service for New Zealanders.
Article updated October 19, 2021 by Trish Willis | About