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Hi guy! it’s Naomi here, your Rapid Renovation expert.
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So, all the renovation work is done and you’re ready to sell. Now it’s time to pass the reigns over to a real estate agent. On top of legal fees and stamp duty, the commission agents charge can be a hard pill to swallow, but what other option do you have? You have to sell through an agent, right?
Well, not quite.
There is another option; one that involves selling the property yourself.
Yes, you can be your own agent.
Before you jump on the idea, there are some really important things you should consider first. As tempting as it may be to bypass the agent and save thousands of dollars in commission – dollars that will stay in your pocket – there’s quite a bit of homework that needs to be done first.
After all, real estate agents are in business because they have the skills and the resources to sell your property – and sell it fast.
So, what’s the first thing you have to do if you decide to try your hand at being a self-agent?
Don’t have time to watch now? Listen on-the-go here:
You need to have a Contract of Sale.
Skills, time and money aside, the very first thing you need before you even think about marketing your property is a contract of sale. Without this contract, you cannot show off your house legally.
You already have a lawyer as part of your A-Team (take a look at my post on personalising your A-Team to refresh). Leave it up to them to draft up the nitty gritty details and then you will be legally allowed to put your property out for everyone to see.
Skipping the agent can make the whole sales process a lot more direct, because the only person you have to deal with is the lawyer, not an agent and a lawyer. Having said that, a good agent will make the whole process run very smoothly, so you probably won’t mind having that extra person to deal with.
But if you’re still keen on going solo, here are some other things to consider.
Beware of the pitfalls.
Selling your property without an agent could save you money, but it can also cost you money. How, you ask?
Well, you might initially save some cash because you don’t have to pay a commission. But what if the property takes way too long to sell? Remember, the longer you hold the property, the less profit you will have at the end because of the loan repayments and those other pesky fees.
So, how do you make sure you don’t get your property stuck in a sales limbo?
Communication skills are essential.
So, before you embark on the no-agent route, remember to brush up on all your communication skills. I’ve mentioned communication skills before, but they are super important if you’re acting as your own agent.
Those negotiation skills, all of that property research you have done will come in handy. As will your confidence. There’s no point going solo if you don’t have the time or the effort to polish these skills.
Think about the way real estate agents present themselves at open homes. Observe and learn from them and how they do things. The worst thing you can do is show your potential buyers that you are an amateur – buyers won’t take you seriously and may even try to squeeze out a bargain.
You need to show confidence – and have skills to back it up.
But before you can even show off your confidence and negotiation skills, you need to set aside some time for it.
Being your own agent takes time.
This is one of the biggest bumps in the road that you can come across when deciding whether you should sell the property yourself.
You need to actually have enough time that you can dedicate to sell the property. This means time for brushing up on your skills, time to research, and time to actually market the property and be there for the inspections.
Think about your lifestyle at the moment. Are you still working full-time? Do you have kids that need to go to soccer practice on the weekends? If you can’t do open houses on weekends, it might be really difficult to get your property out there for potential buyers to see.
Ask yourself this: how much is your time worth?
Time is a luxury, and one that you might not have. So, you need to weigh up how much time you will need to spend on selling the property against how much you will potentially save in commissions and see if it is worth it. And there’s no point in getting to the finish line only to put in a sloppy effort selling the property just because you couldn’t give enough of your time. You won’t give the property the attention it deserves, and your profits might be affected because of it.
The pro of having an agent is that their day job is all about selling your home. They have that time to put into the campaign. And that’s what you need to keep in mind.
Setting a realistic sale price.
This can be another tricky one. If you have already done all the proper budgeting before starting your renovation or even buying the property, you would have worked out how much you are hoping to get for the finished project.
But what if along the way you tweaked a few things in the renovation, and your property could actually be worth more because of it? You might sell yourself short if you are relying on a budget estimate you did before starting your renovations.
Also, if you’re just relying on the general market value, you might not get the best return possible. And that’s because that value might not be a true reflection of the actual finishes you have put in. Sure, it might compare your place to another 3-bedroom house that also had a recent bathroom renovation. But it won’t look at the fact that your bathroom looks like a luxury oasis, while the other is just a budget upgrade.
Which leads me to the next point.
Access to marketing resources.
These days, a lot of advertising is done online. This makes it easier for you to become your own agent because you don’t have to spend hefty amounts on flyers, brochures and print advertising.
But having said that, a proper real estate agency will still have the upper hand when it comes to marketing your property. Not only do they have the experience to know what works for a particular property, and be able to reach a wider audience, they also have the reputation behind them.
Sometimes your ideal buyer – the one who is willing to pay you exactly what you want – won’t even realise your property was on sale when it is being marketed privately. The buyer was out there and ready to hand over their money, but you both missed the opportunity.
And sometimes the buyer may not be comfortable handing over such a large sum when it doesn’t involve a professional agent. I have said before that first impressions count, and if you have a hand-painted “for sale” sign out the front, it might deter some buyers.
If you are confident in your ability to advertise the property and make sure it reaches the right people, then selling without an agent may well be up your alley.
Just keep in mind that, although an agent may cost you money, they also reduce the risk and hassle of selling a property. And the last thing you want to do is be turned off renovating for wealth just because the selling part was too stressful.
Being your own agent is not for everyone. Sometimes you just don’t have the time or the patience to deal with the process. And sometimes the sell price won’t be worth the savings you gain.