November 12th, 2015 •
By Heather Whyte
We’ve received some great comments on our blog post ‘Does COMFREE Work?’ that are both favourable and not so favourable towards selling real estate privately, and realtors in general. We thought we would address some of the comments that are not so agent-friendly, to offer up a different perspective.
Why pay an agent for something I can do myself?
There seems to be a belief that agents simply put an ad online, put a lock box and sign up, and that’s all that they do. There is a plethora of other tasks going on behind the scenes to get a property listed, get an offer, and then take it through to closing. I won’t list them all here, as risk of inducing sleep. Between 90 and 95% of properties that sell, sell with an agent. I recently spoke with a real estate lawyer who does a large amount of business and he said that between 5 and 10% of properties sell privately. Do private sales happen? Yes. Is it the norm? No. The fact is, we are the professionals, and the likelihood is that the process will be easier, and a lot of times you end up netting more working with an agent. Take an accountant for example. Can you do your taxes yourself? Yes. Will you net more money if you do it on your own? It’s possible. Do they know tax law better than you do? Certainly. I agree that there are bad realtors, bad accountants, lawyers, financial advisers etc out there. The best thing to do is to do your research and make sure that you are aligning yourself with a competent professional, no matter the task. And if after that research, you’re confident that you can do their job better than they can, and have the time to do so, then more power to you!
‘It just takes one buyer ‘
This is true, which is why we say that ComFree can work, it’s just usually more challenging as you don’t have the same access to information on the current market, and are not advertising it on as many channels. Buyers can come from anywhere, and the more eyes that can see it, the more likely you are to get a good offer, in good time, for top dollar.
Agents put buyers on an automated search and they are bombarded with emails for properties that don’t meet their criteria:
This can happen as well, when the buyer has broad criteria. In this case, they should be getting a lot of listings. The key here goes back to that professional relationship. We set our buyers up on searches so that they can see the new listings coming in, but depending on the buyer, they may not want emails frequently, or they may not want the automated emails at all. They would prefer someone to look for them, and send them properties that truly meet what they are looking for. Some buyers have very strict criteria on neighbourhoods, price points, finishes, etc. and they will get very few listings. Each buyer is unique and needs to be treated as such. Good agents will formulate a specific plan for each buyer, and should be checking other sources for properties in addition to our system. We do not just rely on an auto-generated search with our buyers. With a large overpopulation of agents, however, this isn’t always the case. The key is to match yourself up with someone who is ethical, knowledgeable and experienced. A professional agent will sit down with each buyer and perform a buyer consultation to find out exactly what their criteria and needs are. We have some buyers that in the initial stages want to be bombarded with every new listing as they enjoy looking educating themselves on how far their money goes in the different neighbourhoods. These are typically people who are new to the area and don’t really have a sense of the different neighbourhoods. In most cases these types of buyers start out with very broad criteria and we refine as we go. How do you dismiss a neighbourhood if you have never seen it?
Yet other buyers who have lived in the city and know the area might have criteria so stringent that it is limited to a particular street. In these cases we typically door knock and flyer these streets to find potential sellers. I am not sure this is a service ComFree is currently offering?
All the agent does is put a sign on the lawn:
There is a common misconception that selling real estate is easy, and the only thing an agent does is put a sign on the lawn, put it on MLS and wait for the offers to pour in. If this were true, there would be a lot more successful agents out there. Yes, there are a LOT of agents out there. In Kitchener/Waterloo alone, there are over 1,200. However, the average agent in Kitchener/Waterloo sells 4.39 homes per year. That’s not remotely enough to live off of. The perception is that real estate is easy – it’s anything but. It can be a great career, but easy? Definitely not. There is a lot that goes into representing clients on the list side and the buy side. On the list side, a lot of what happens goes on behind the scenes, and is not as tangible as a buyer’s agent that’s been out night after night showing you property, for example. When you list your home with an agent, they are responsible to represent you properly. We all have to carry insurance. If we make a misrepresentation, intentional or not, we can be sued. We take on that liability for you. If you’re selling yourself, and make misrepresentation, you are on the hook for that. We also have an understanding of contract law, and the nuances of how that applies to real estate. It’s our job to understand the ebb and flow of the local market, the neighbourhoods, the statistics, the local economy, etc. We are this resource for our clients. Additionally, there is the advertising piece. Each agent has their own marketing strategy for clients. Ask your agent for specifics on what they are doing to market your home. We also provide services to our clients such as a staging consultation to have their home show it’s best, and a pre-list inspection to find out if there any major issues that would impact price or a buyer’s decision to purchase the property. Then once the house actually gets an accepted offer, there are a myriad of tasks, as well as surprises that come up between acceptance and closing. There is much more that goes into it as well, but at the risk of boring you, we’ll stop there.
In summary, COMFREE and other private listing services can work for the right person and the right property. If you are considering listing privately, see what COMFREE and other companies offer, and interview a few agents. Will it be worth it to you to do it yourself? Make sure you fully understand what you’re getting yourself into.
We’d love to hear from you. What has your experience been with selling privately?