If you’ve decided to sell your home chances are you’re either looking for a real estate agent, or already have one in mind. It’s also quite possible that your agent will give you a long to-do list to prepare your property for sale, including washing carpets, painting walls, and trimming the lawn to bump up the curb appeal. If you haven’t already, you’ll probably be advised to rent a storage unit for furniture, so your agent can stage your house to help potential buyers envision themselves living there.
In some cases, you’re coming out of pocket for $15,000 before the agent has your house on the market. In others, the agent might even convince you that your kitchen cabinets are embarrassingly outdated, your windows should let in more light, and your bathrooms have the type of tile hospitals buy in bulk. You may even hear your agent call your carpet “commercial grade.”
The pitfalls of listing your house with an agent
Situations like this are not uncommon. Real estate agents often demand significant repairs just to list your property. But even after all that, there is no guarantee of a sale, much less a contract at an asking price that meets your standards.
The truth is that most agents are not even qualified. There are approximately two million real estate agents licensed in the United States, and many of them have completed zero transactions in the past year. But how many transactions are enough to develop a deep understanding of your neighborhood? How much experience is enough to not take a deal at any price? Your agent is the person you are trusting with your most valuable asset.
So before you take a realtor and their potentially expensive advice at face value, consider a few questions.
- Repairs can make your home more valuable, but are you willing and able to take on the work?
- Do you have the right skills to complete a home renovation?
- Do you know how to get the right permits (because nothing kills home value like unpermitted work)?
- Do you have the time, and how much is your time worth?
- Have you ever heard of someone completing a project that turned out to be easier and cheaper than expected?
Don’t let these considerations overwhelm you and put you off from selling your house altogether. After all, the longer you wait, the more money you are spending on mortgage, taxes, insurance, utility bills, and HOA costs. A leaky roof may be daunting, but it’s also compromising the structural integrity of the property, which may increase your costs down the line. The more termites eat away at the support beams and floor joists, the more the value of the home is deteriorating. In extreme cases, a damaged property could become condemned, making it virtually worthless, with the price estimated at land value, minus the demolition costs.
How to decide the best route to selling your home
If you know it’s time to sell, here are three tips to help decide what’s best for you:
1. If your house is in market-ready condition, selling with a realtor can make a lot of sense. However, if your house does not have a modern up to date feel or if it needs repairs, it could take a long time to sell. Houses that sit on the market for a long time are typically sold at a steep discount. Also, be careful with realtors. The majority of them have very little actual experience (tip: ask how many homes they have sold personally in the last year, not their company) and all charge high fees, typically 6 percent.
2. For homes that are not market-ready, a great option is to sell to a property developer or what is known as a “cash buyer.” There are many of these companies, and you may have received their postcards in the mail. Your first instinct should be to be wary of these guys, and for good reason. They make a living by negotiating deep discounts on homes. Your discount is their profit margin.
3. A new option, Sundae, is a marketplace for homes that are not market-ready. We have seen too many people not get all the value out of their home when they sell, and we want to change that. We are committed to paying you the highest reasonable price with no modifications or last minute adjustments that kill your profit. In fact, we can pay more because we take less profit. We operate on a large scale so we don’t need to make a lot per transaction, and we don’t charge realtor fees. We also offer assistance, like providing a $10,000 cash advance to help with moving costs. Sundae provides a lot of advice to people trying to think through their options. If you get an offer, we can almost certainly beat it. Don’t hesitate to call us and ask.
One last thing to remember: Whatever situation you are facing, you should focus on what you can control. Get the most money when you need it most, and always seek the best offer. Look for transaction partners who are open and honest, and are not just good at selling you on their offer.