For Sale by Owner Thoughts, and 80918
For home sellers, here's how I may make you up to $15,000 over what you would make selling your home on your own, and for way quicker, and here's how I am different from other agents you may talk to:
As you may know, For Sale By Owner Houses don't usually have the same traction as a house listed by a real estate agent. They also don't usually sell for as much. This is due to the inexperience of the homeowner, bad pictures, incomplete info, and most importantly, the homeowner isn't responsive enough to actually sell their own home (I see this one ALL the time).
And of course, it’s not their full-time job, so they can’t give it full-time treatment, which is what you need to sell a house!
For Sale By Owners also don't have public data on what they listed for, how long they were on market, and what they sold for. It's hard to have good data on them because of this. However, as an example, I personally followed a FSBO in 80907 this year, and this is what I found:
1201 Westmoreland listed for $400k sometime in early April 2021. It sat on the open market for two months before the seller listed with an agent on June 25th. They listed at $395k. It went under contract Jul 9th (14 days on market), and sold for the same price, $395k.
When I talked to the homeowner, I thought his asking price of $400k was too high for the home, and that seems to have been correct! It sat on market for too long, even with an agent, and the seller missed out on getting a bidding war and top dollar for his home.
The listing agent also missed out on getting more for her seller. If they had listed a little bit less, they could have easily gotten into a bidding war!
Let's take a few more for sale by owner examples in 80918:
There are currently 53 for sale by owner homes in all of El Paso County, at least on the Zillow website, and 2 on ForSaleByOwner.com.
More nearby For Sale By Owner homes:
By comparison, the average days on market for an agent listed home in 80918 is 4 days before it goes under contract! Agent listed homes in 80918 have also been selling for 101.1% to 108.2% over the list price over 2021 (last year it was 100.0% to 102.2%).
FSBO homes seem to sit for 2-3 months before they list with a real estate agent, or they finally do get a lower offer that they decide to take because of the sunk cost fallacy. Or they cancel selling altogether and just get frustrated.
If a home has sat for 2-3 months without an offer, and I wanted that home, I'd be offering a considerable amount less than asking. If the house was listed at say $450k, for a couple months on market, I'd offer $400k.
I mean why not, what's the worst they're going to do, say no? They can counter, and we can find some compromise, but I would at least expect a 20k discount on the price of the home. I could be totally off the mark here on pricing, but that's my personal opinion.
So let's say you as the seller sell this house on your own for $430k. After paying the buyer agent commission (3% is an average amount for each agent that we see in Colorado Springs, though this number is negotiable with your agent) and title company costs, you're usually paying around 4% of the amount you sell your home for, if you sell it without a listing agent.
So in the above example, you as the seller doing FBSO would be walking away with $417,100, and that’s if you actually get $430,000.
If you instead listed with a real estate agent, your agent would likely tell you your home needs to be priced lower, at say $430k. Once your agent lists your home, if we expect to sell your home for 101.1% to 108.2% over the list price, like the average for 80918 in 2021, then you could expect to sell it for $434,730 to $465,260. After factoring in 7% for costs (both real estate agents, and title costs, again, your own numbers may be different), your net amount is $404,299 to $432,692.
So selling at the same price, you make $12,801 less, to $15,592 more with an agent than you would selling it yourself, and you'll do it in 4 days instead of 2 months or more on your own. As a good real estate agent will often be able to sell your home for more, you may make even more on the sale of your home with an agent.
Now, if you’re listed in the MLS with an agent, you stand a much better chance to actually sell your home than selling on your own. Often what will happen is a homeowner will try selling their home on their own, give up after a month or two, and then use an agent. The price could have been too high, or the pictures bad, or not enough exposure as many buyers rely on their real estate agent’s MLS search. Often it’s all three.
So based on the information above, you MAY be able to sell for more on your own than with an agent, but without the experience, responsiveness, and discipline that it will take you to sell it, the odds are against you.
You can potentially save the commission you would have paid out to a listing agent, but then that work your agent would have done falls on you instead, and it’s a lot more work than most people are aware. There’s a reason there’s a whole job for it!
Ultimately, the net amount you as the seller walk away with is the most important number. If I can get you a net amount that is as much or higher than what you were hoping to sell your home for, then does it matter if my commission is $1,000, $10,000, or a million dollars? At the end of the day, the important thing is how much net you are making on your home.
I am transparent in what your options are and what the costs for those options look like. Whether it’s listing your home on the local real estate market in Colorado Springs, or getting a quick cash offer, you get to make the best decision for you! Many buyers are also typically willing to let you stay in your home for a month or two (sometimes more) after closing, so that you have time to find your next home!
If you'd like to dive deeper into numbers, I'm happy to do that with you.
Now, if you live in 80918 or know someone who does, then I’ve compiled some data for 80918 in particular:
There are 7 new listings in 80918 in the past week, ranging from $349,900 to $460,000. There are currently 30 homes for sale. There are 85 80918 homes currently under contract, and 427 that have sold in the last 6 months. 80918 is projected to increase in value by 15.4% over the next year.
Median sale price for 80918 in Colorado Springs for the past 5 years:
What I am looking for: someone who is looking to sell their home in 80918 in Colorado Springs, and who is looking for the knowledge and assistance of a local real estate agent. If you are interested, or know someone who is, please let your friendly neighborhood agent know (remember I live here!). Thanks, and I look forward to working with you now or in the future…
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