A Rebuttal Against The Widely Publicized Article by Anthony Stokes Pereira Titled “10 Tips for Selling Your Home On Your Own” *
Anthony Stokes Pereira, a Licensed Realtor from Rand Realty, has written an article about selling your home on your own, FSBO style, but it contains material that we don’t believe is objective as it could be – this is our rebuttal of his statements pertaining to selling your home “For Sale By Owner” and a challenge that the article he wrote is a self-serving ode to try to save the realtor industry from extinction.
Price Your Home Competitively to the Market: *
Stokes Pereira Says:You need to make sure that you’re pricing your home according to the market. Too many sellers (not just those selling on their own) price their home emotionally, based on what they “need” or according to what price they purchased the home for. Buyers don’t care about what you need to get out of your home. They’re going to pay only as much as the market demands. So you need to look carefully at recent comparable sales in your area, to see where you should be pricing your home. We have great resources available on rand-realty web site to help you find comparable recent sales and allow you to track your local market.
Our Rebuttal:
Because you are not paying the extortionate commission (often about 6%) that the realtor charges, you can afford to price the property lower than the comparable – the others sellers are your neighbors who are using a realtor to sell their home and cannot afford to drop their price to match yours, because they are giving away 6% of the sale at closing to the realtor and you are not. If your neighbors want to get into a discount price war, go ahead and let them – you will always be ahead of the game by 6% anyway, so they will be on the losing side of the financial equation.
Keep track of the market: *
Stokes Pereira Says:Don’t let your home become stale. Your price needs to reflect current market conditions, which can change over time. If you’re on the market for a few months, you need to keep track of what’s selling, and what’s not selling. If you see houses start to sell at prices below yours, it’s time to reevaluate your pricing strategy.
Our Rebuttal:
We agree with Stokes Pereira on this one, you should constantly assess the latest home sales data, although realtors often try to limit clients ability to see sales data, even though it is public. Often realtor associations will only allow realtors to see “public” sales data, which is very frustrating for the homeowner, trying to do it by themselves. It’s called protectionism in this country and it stinks of corruption.
Get commitment letters from any buyer presenting an offer: *
Stokes Pereira Says:One of the great frustrations in selling your home is going through the process of negotiating an offer with a buyer and maybe even getting into contract before discovering that your prospective buyer is not financially qualified to purchase the home. You should not accept any offer without getting what’s called a “commitment letter” from a reputable mortgage broker or bank establishing the credibility of your buyers. Demand such a commitment letter from anyone trying to make you an offer.
Our Rebuttal:
Commitment letter don’t really happen when you do have a realtor, so why make the seller who is doing it for themselves jump through these additional meaningless hoops. Some sellers can wallpaper their house with useless commitment letters. Let your attorney handle the whole piece of this, he will work with the buyers attorney to see the credibility of the offer.
Prepare your home for sale by detailing and staging it: *
Stokes Pereira Says:If you want your home to stand out, you need to detail and stage it for showings. Detailing means cleaning the home from top to bottom, eliminating a lot of the clutter from your closets and cabinets, and making the rooms look bigger by storing your unnecessary furniture. Staging is the next step of detailing, where you actually take a “designer’s eye” to your rooms and try to arrange them for maximum aesthetic appeal. Spend time making your home look great to prospective purchasers.
Our Rebuttal:
Savvy buyers are getting very tired of being manipulated at “staged” homes – they know it’s a scam and savvy buyers will not fall for it. Perhaps ten years ago it worked, but buyers are much smarter now and would prefer a home to either be empty, or at the very least de-cluttered. You see staging happen on the home renovation TV shows all the time. “Fred and Ginger got an extra $20k because they staged their home” – but now everyone is wise to it. This reminds me about the story where new home builders would stage their homes for sale with furniture that was 30% smaller than normal, to make the rooms look bigger. Those sort of practices are long gone, buyers are wise to both scams and react accordingly. They tell the seller to stuff it and find another property. Appraisal specialists know a dirty little secret. The value of the home is based on its square footage and the average cost-per-square-foot in the area. Sure you can tweak a little more for newer appliances, but the appraisal formula is used so often that it has become the de-facto standard.
Be ready for showings at any time: *
Stokes Pereira Says:Once you have your home ready for showings, you need to keep it that way. The hardest part of selling your home is that you have to keep it in showing condition at all time. You need to keep the rooms clean, do the dirty dishes every day, put the garbage out, and all those things that most of us neglect when we’re living our normal lives. And you need to make sure you’re available to show the home anytime a buyer wants to come see it. You never know when your buyer could be coming to visit, so you have to be prepared every single day.
Our Rebuttal:
This is baloney. This doesn’t happen with realtor listed homes, so why would it happen with FSBO homes.
Don’t scrimp on your marketing: *
Stokes Pereira Says:Remember that when you’re selling on your own, you need to be your own marketing professional. That requires making high-quality marketing materials (flyers, postcards, brochures) for your home, including high-resolution photos and an expansive and appealing description of your home’s highlights. You can find online resources for doing all of that, so it is possible to do it yourself. But don’t scrimp on your marketing. When you’re selling on your own, you have a limited ability to reach the public, so it’s particularly important to make a strong impression when you attract a potential buyer’s attention. And remember to freshen up your marketing. You should probably do new marketing materials with new pictures every few months or so.
Our Rebuttal:
Realtors will always tell you about how much money they sink into marketing and its mostly baloney. Forget all the crappy marketing materials they produce and just get listed on your local MLS by using a flat-fee MLS listing company. Print out a 1 sheet spec sheet for a takeaway for people who come to see the property.
Be careful about your home security: *
Stokes Pereira Says:When you’re selling your home on your own, you don’t have any buffer between you and potential visitors. Make sure you hide away your valuables, and that when people visit you don’t inadvertently reveal your security codes, the location of hidden keys, or anything else that might compromise your security. You should also make sure to get identification for all your visitors, having them sign in when they see your home.
Our Rebuttal:
This is clearly no different when you use a realtor. Realtors don’t make very good security guards either, so its contrary – we anticipate that you actually take better care of your belongings than they do.
Be honest about the property condition: *
Stokes Pereira Says:Remember that New York State law requires sellers to be honest about the condition of the property they are selling. If you have well water as drinking water, for example, you might be required to get the water tested for buyers. And if you know of problems with the property that the buyer could not discover upon reasonable inspection (like water that collects in the basement after rains), you may have an obligation to tell buyers about that.
Our Rebuttal:
We agree, disclose everything. Your lawyer would advise this regardless of how you are selling your home anyway.
Hire an experienced real estate attorney: *
Stokes Pereira Says:If you’re going to sell your home on your own, without the assistance and advice of a real estate professional, you should absolutely make sure to retain an experienced, local real estate attorney to handle your sale once you have an acceptable offer. Do not scrimp on a good real estate attorney by hiring an out of town relative, or your “family” attorney. Get someone experienced in local real estate law.
Our Rebuttal:
Local real estate attorneys are usually family attorneys, maybe at Rand Realty there is a lawyer who specializes in Real Estate, but we are not sure where you could even find such a thing – the Bar Association doesn’t say there is such a thing either – where in New York is there an attorney who only does closings?
Consider cooperating with buyer agents: *
Stokes Pereira Says:Lastly, if you’re going to try to sell on your own, you might still consider cooperating with buyer agents. Most buyers work with agents, so if you sell by yourself you’re probably not reaching the largest possible pool of buyers. Even if you’re not listed on the market, though, some buyer agents might approach you for a “FSBO Listing Agreement” in which you will pay a commission if and only if that agent finds you the buyer for your home. In that case you only have to pay a commission if a buyer agent procures your buyer, and you get an acceptable offer from that buyer that is sufficient to pay that agent’s commission. Not all buyer agents will agree to such an arrangement, but some will. If they will, it’s a good deal for you, and can help you find the right buyer.
Our Rebuttal:
OK, if you have to sleep with the enemy, then this would probably be the time to do it as it adds value to your FSBO process and helps you find legitimate buyers. But 2% or even 2.5% commission, you are going to feel like you were stiffed, but it still beats a total commission of 6% by a long chalk.
The following are 7 statements that Rand Realty made why you should NOT sell your home FSBO with our rebuttals. *
Basic economics says that brokers will get you a higher price: *
If you’re trying to get the best price for an item, you need to expose it to the largest potential pool of buyers. That large pool of buyers can then bid against themselves to drive the price up to the highest level possible. If you list with an MLS broker, you create the largest possible demand for your home by putting your home into the open real estate market, with hundreds of brokers and thousands of agents working to sell your home to an enormous pool of buyers. Basic economic theory says that the larger the potential buyer market, the higher the price. But if you don’t take part in that broker-generated market, you’re not going to get that broker-generated price. You’re the only one working to sell your home.Our Rebuttal:
Baloney, get on a flat fee MLS (Multiple Listing Service) and you will get the maximum exposure you deserve.
You don’t get the internet exposure: *
If you’re trying to sell your home in the internet age, you need maximum internet exposure. When you list your home with a broker like Better Homes and Gardens Rand Realty, we list your home on our website which gets thousands of unique users every day. On top of that, we also list your home cooperatively with all the other real estate broker websites in the region, including our competitors. So any buyer looking on any conceivable real estate website is going to find your home. Yes, you can list on some sites that take FSBO listings, but not on the local broker websites, which is where most buyers look.Our Rebuttal:
More baloney. Get on a flat fee MLS broker or agent (Multiple Listing Service). You will get the maximum internet exposure you deserve. MLS is where everyone is looking. Even Zillow picks up its data from MLS. The only internet exposure you do not get is the realtors own website, but who cares about that? It hardly gets any traffic anyway, anyone that is looking for a house online is looking at MLS.
Who are your buyers going to be? Bargain-hunters: *
If you’re selling on your own, you’re really marketing to a small segment of the buyer population that has chosen to work without a broker. Why would people work without a broker, who will do all the leg work for them, particularly when most buyers perceive that the seller pays the broker anyway? The answer is that buyers who work without a broker are looking for bargains. They’re looking for bargains. They think that people who sell on their own are likely to be more negotiable, less likely to price well to the market, and more desperate. So your buyers tend to be bottom-feeders, looking for the best deal they can get. That does not put more money in your pocket, it puts money in their pocket.Our Rebuttal:
Where is the evidence to support this – sounds like empty rhetoric to us, or even worse “scare” tactics.
The people using MLS service are the very same people the realtor would get for you.
Well, you’re not paying a broker, so: *
Even if your bargain-hunting buyers make an offer, they’re likely to use your FSBO status against you in low balling you. Most offers will come with this qualifier: “well, you’re not paying a broker’s fee, so this offer is almost what you’d get if you sold with a broker.” In other words, buyers will always deduct the perceive commission from their offers, justifying it because you’re not paying a broker. So you end up saving them money, not you.Our Rebuttal:
Maybe it comes in the negotiation, usually the saving gets split between the parties and then the negotiation is over, the buyer doesn’t get two bites at a discount.
Do you really have the time for it? *
What’s your time worth? Selling a home is a big job, and takes a lot of time. That’s why most people hire professionals to take all the steps to sell a home: taking pictures, putting up signs, putting in ads, staging and detailing the home, placing listings in internet sites, writing descriptions, arranging showings, attending showings, getting feedback, holding open houses, and keeping track of the market. And that’s before the entire offer and acceptance stage, which requires even more work. Yes, you can do that work yourself, but how much is your time worth? If it takes you 30-40 hours of work to do the agent’s job for her, in order to try save a few thousand dollars, was it worth it to you?Our Rebuttal:
Listing agents are often quite lazy when it comes to actually working for you, but will be quite vocal when blaming you when things do not sell. A couple of photos, some quick write up and get it listed on a MLS flat fee service and you are golden. 30-40 hours of the agent’s time are usually taken up getting massages and getting laid, maybe 3-4 hours is all they spend on you. They do, however, have some great contacts; but things are changing, very much in your favor – welcome to the internet age.
Our marketing is more powerful than FSBO marketing: *
Our marketing is more powerful than FSBO marketing People who sell on their own see only the superficial aspects of what an agent does, and think that they can do those same things. They can put up a sign. They can put an ad in the paper. Why should they pay an agent thousands of dollars to do it for them? That’s understandable, if that was in fact all that an agent did. But our sign is different from a FSBO sign, and our ad is different from a FSBO ad. When someone calls on our sign or ad, and finds that the home they called on isn’t right for them, our agent handling the call transitions them to other comparable homes that might meet their needs – like yours. If someone calls a FSBO ad or sign, and the home is not right for them, the seller is not about to transition them to being interested in other homes. When you’re part of the broker-generated market, you get the value of that market.Our Rebuttal:
Baloney, get on a flat fee MLS (Multiple Listing Service) and you will get the maximum exposure you deserve.
You’re not really paying the commission: *
Why do people think that the seller pays the commission? At the closing table, all the money comes from the buyer, not the seller. Yes, the seller is the one who actually writes the check for the broker’s fee, but it’s the buyer who provides that money to the seller. Really, it’s the buyer who pays the commission, by paying more for the home than she probably would for a FSBO sold without a broker. Finally, if you are in a short sale situation, your bank pays the commission. People think that that if they are underwater on their mortgage, they need to sell on their own to save as much money as possible. That’s exactly backwards. In those situations, you absolutely need a professional, trained real estate agent to handle your sale with the bank. The bank will pay the commission, not you. And your agent can help make sure that your bank will take the short sale, helping you through the process.Our Rebuttal:
This is obfuscation at its very worst,- of course the seller pays the commission – they get paid less than they would if they didn’t use an agent. Stokes Pereira should rethink this one. It’s an outright lie.
