Wednesday, April 24, 2013

With Homes Selling So Quickly, It’s Tempting to Think You Can Do It Alone

[Published April 25, 2013, in the Jeffco editions of the Denver Post’s YourHub section and in five Jefferson County weekly newspapers]

It’s an interesting contradiction — thinking that you don’t need a listing agent in a seller’s market.  Put a “For Sale by Owner” sign in the ground and sell your home in a day or two, you think.

The fact is that you need an agent even more to deal with multiple offers, most of which will come from buyers represented by agents. In such a situation, you don’t want to be the only player without professional assistance.

Moreover, as with FSBO’s in any market, you’re probably going to be paying the buyer’s agent 2.8% commission, so it may be worth paying a couple more percentage points to level the playing field.

Lawyers (and their clients) are familiar with the expression, “a lawyer who represents himself has a fool for a client.”  That speaks to the importance of having a dispassionate professional on your side in what is likely the biggest transaction of your life — selling your home.  And when you have the possibility of a quick sale, you need the expertise of a professional in (1) setting the asking price and (2) weighing competing offers.

In last week’s column I described several ways in which a buyer can make his offer more attractive than competing offers.  I was reminded by a colleague that I left out one of the most powerful techniques, which is the “Dear Seller” letter in which a buyer sweet talks the seller into choosing his/her offer for personal reasons such as the buyer’s love of the seller’s garden or because the buyer’s mother dying of cancer wants to die in your home.

Should you accept the highest price offer with 3.5% down payment or the lesser offer with 50% down — or the cash offer which waives inspection and appraisal conditions?  If your preferred offer is contingent on the sale of the buyer’s house which is under contract, you need a professional who can assess the strength of the contract on that buyer’s house.

How about taking a back-up offer — and how does that work, anyway?  There are just so many reasons that you need an agent on your side more than ever in today’s fast-moving market — whether you’re the buyer OR the seller.

If you have negotiated (as you should) a variable commission rate with your listing agent, it’s also tempting to keep your home off the MLS to increase the chance that your agent will sell it himself, costing you less in commission. But, while the agent may bring you one buyer, your only hope of getting competing offers that increase the sale price is to let the world know about your listing.

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