Is it better to list with a realtor or buy owner ?
What is the typical commission? If I were to list it with a realtor.
How can I avoid getting stuck with 2 mortgages ??
Answer:
Hello,
Great question, I am myself a licensed Realtor, so I'll give you an idea of the effort a Realtor takes to Market a property.
1. Do an assessment of the market and recommend the right strategy. This involves the following activities.
a. Understand the current market conditions and interest rate scenarios. How the current market conditions will affect you in terms of your buy / sell decision.
b. Arrive at appropriate pricing so that the home markets in the shortest time for the best price.
c. Work on an appropriate marketing plan.
2. Understand your property and help you prepare it for appropriate market exposure.
a. Realtors understand a lot about properties, because they are exposed to a lot of properties before they take your property for marketing. It's not very complicated to understand the right setup for marketing. But a Realtor has already done those experiments and understands the kind of buyers prevalent in your area. S/He will help you prepare the property appropriately by helping you choose the right kind of upgrades (not too pricey, but those that will give you the best bang for buck).
b. They understand the legal aspects of selling a property and will protect the seller from any legal consequences by identifying the problem areas in your property in advance.
c. They will help you order the appropriate inspections to help you with a faster sale at the best market price.
d. They will know the competing properties on the market and help you stage the property appropriately.
3. Helping you with paperwork while giving you a good understanding of the transaction, legal aspects and completeness of information.
4. Marketing and exposure: Realtors will plan an appropriate marketing campaign by choosing the most cost effective vehicles to expose your property. They will send out mailers, expose the property on MLS and will even expose it to their private network and the appropriate audience.
5. Once they have generated enough interest, buyers will show interest and have questions, concerns and comments on the property. One of the aspects of a transaction is to reduce the buyer and seller anxiety. A Realtor is well trained to do this.
6. When an offer/s come in, help you understand the intricacies of the offer and evaluate the best buyer, price and terms and conditions. Negotiate on price and terms with the buyers.
7. Once an offer is accepted, explain all your legal choices, follow through on completeness of paperwork. Help with Escrow and closing.
8. The whole purpose is to get your the highest and best price in the shortest possible time.
You will have to do all these things before you can put a house up for sale, through the sale and post sale. If you look at just the sheer number of hours that a Realtor puts in, I think you will not have a doubt that a good Realtor is worth their commission, if not more!
As someone else has pointed out the typical commission is 6%; 3% for the buyers agent and 3% for the sellers agent. This is negotiable and the Realtor should be able to help you with the best commission strategy on the market.
As I have suggested earlier, the Realtor will help you work out a strategy that fits your situation. This will include double mortgages, whether to list an occupied property, rolling money into tax favorable structure.
I hope that helps.
Again: I am a Licensed Realtor and work with Century 21 in Sunnyvale, California.
i all ways tried to run in the paper or put for sale signs up and had good luck, but i only dealt with acreage
right now is not a strong market to try to sell your house (listed or by owner). how about just cashing out on your house to hedge until the market picks up again (then sell it if you still wish). atleast then your not desperate to sell your house below market and by cashing out you can afford the 2 mortgages. dont worry about agents commisions - they only apply after they sell your house - which is what you want anyways, correct?
A Realtor will help deal with the paper work and look out for your interests. The normal commission is 6% split between the Realtors but can be negotiated. There are also a lot a flat fee brokers now that charge a flat fee for their services but before you sign with one make sure you find out exactly what you get for your money.
As for the 2 mortgages I don't know.
For most people your home is your biggest investment and buying/selling gets real complicated. It is worth the 4-6% to allow a professional real estate agent to sell your home. You do not pay the agent until you are at the closing table and the checks are cut. A professional real estate agent will do everything for you, from pricing your home (this is the most crucial factor in selling a home), marketing your home, and making sure it goes from the for sale sign to the closing table.
An experienced real estate agent is also useful if you are going to be buying a new house and selling your old one at the same time because they can offer advice so you don't get stuck with two mortgages or with any other crazy situations. Most of the time a seller will not go into contract with someone who needs to sell their current home to buy a new one unless the buyer is already under contract to sell their own home. It gets really complicated so it is a good idea to list with an agent. As far as the two mortgages go, some banks have what they call a bridge loan, which is a loan to help purchase the new one and will get paid off once you sell your current house. Don't get nervous about that 4-6%, it might look like a large portion, but for the amount of work that is put in behind the scenes from advertising, showing your home, open houses, qualifying buyers, negotiating, making sure it appraises, and making it ready to close; in the end it all worth it that you had somebody to take care of it.
Sam
* According to Thomas M. Stevens, President of the National Association of Realtors for 2006, "Finally, the plain fact is that hiring a professional pays off. The typical home represented by a professional last year sold for 16 percent more than those sold without a professional’s help. That profit more than pays for the agent’s commission. Millions of homeowners know it, and that’s why they will continue to call on experienced real estate professionals."
Typical commission rate is 6%, which is split by the listing and the selling agent.
The problem with offering your listing agent a low commission is that they will be less motivated to spend more time and money on marketing your home. The other problem is that your home will be less attractive to the selling agent as well, since you are offering less commission to your listing agent.
Focus on finding a good Realtor to work with rather than saving. In the end, you can make more with a good Realtor. If you are looking for a highly qualified Realtor go to http://www.ReferredPro.com and I'll be happy to personally refer you.
Read more about why NOT "For Sale By Owner" on my Blog
http://burlingamerealtor.com/serendipity.
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