Selling a home without an agent takes some time, money and careful planning ON YOUR OWN

May 29, 1994|By Lorraine Mirabella | Lorraine Mirabella,Sun Staff Writer

So you've finally found the house of your dreams, and now you have to sell the one you own.

Do you post a "For Sale By Owner" sign, call a real estate agent or forget the whole thing?

Any of those could be the right choice, says Bruce Hahn, president of the nonprofit American Homeowners Foundation, which has just published the 142-page "How to Sell Your Home Fast."

Mr. Hahn predicts that "For Sale By Owner" signs will become more common in front yards around the Baltimore area as the market improves. In a seller's market -- like the mid-1980s, when buyers tended to outnumber homes on the market -- homeowners are more likely to find a buyer on their own, Mr. Hahn said.

Once again, "the market is moving in a direction where homeowners can start considering selling on their own," he said. "As the market improves, it becomes more realistic for homeowners to sell a home without an agent. A couple years ago it was awfully hard without the extra advantage of the multiple list."

But selling a house by yourself can be difficult. A homeowner trying to save himself real estate fees by selling on his own needs to carefully plan and prepare, Mr. Hahn said.

BTC Going it alone might be the only option for sellers who otherwise couldn't afford to pay off a loan. But others should weigh the expense and work of selling their property against the cost of having a real estate agent do the job, usually for a 6 percent commission. Buyers who fail to sell their home on their own and turn to an agency often would have been better off -- and saved money -- starting out that way, Mr. Hahn said.

For Sale By Owner sellers should be prepared to spend time and money, first to make their home presentable, by cleaning, painting, making minor repairs, tidying the yard and clearing unwanted furniture or belongings. Sellers then should develop marketing plans outlining when and how often to advertise and schedule open houses.

"It generally comes down to how much time the seller has and wants to devote to selling," said Mr. Hahn. "A general rule would be every other week, with advertisements running those weeks."

Other ways to reach buyers might be through grocery store bulletin boards or church or civic association newsletters that charge nothing or very little to advertise.

"If you don't market, you won't sell the home," he said. "There may be people who have time but don't have sales skills and shouldn't be selling their own house."

Robert Lafferman could say that about most homeowners he sees trying to sell on their own. The real estate agent with Long & Foster Real Estate Inc.'s Hunt Valley office gets most of his listings from frustrated For Sale By Owner sellers.

"They just can't reach enough people," he said. "Today there are qualified buyers, but you need to place the sale in the hands of someone who will market. Running an ad a week every couple of weeks won't get the job done."

He notes, too, that sellers often aren't equipped to guide buyers through the process of getting a loan.

Mr. Hahn agrees that it often takes longer for a buyer to sell a home on his own than for an agent who places the home on a computerized Multiple Listing Service, like the Central Maryland Multiple Listing Service, which covers Baltimore City and Baltimore, Carroll, Harford and Howard counties. Such listing services -- run by local real estate boards, whose members can list homes and look at others' listings -- are the main tool for selling homes.

"The seller is saving 6 percent commission, but you're also competing with homes that are multiple listed," Mr. Hahn said.

Some real estate agencies have tried drawing the business of For Sale By Owner sellers by offering to list their homes on the Multiple Listing Service for a flat fee. The listing offers valuable exposure, Mr. Hahn said. "It's a great advantage in a slow market. It gets people to your house."

But getting them there isn't necessarily enough, he points out. After a buyer has toured five or six homes, details tend to blur. Sellers can compete by handing out brochures showing the home's exterior and interior and listing its features.

Mr. Hahn said sellers should set both asking price and minimum acceptable selling price, determining fair market value based on sale prices of comparable homes in the past six months, preferably ones on the same street. If none are available, he suggests looking for homes in the neighborhood with similar features, construction and lot sizes. Sellers can ask a real estate agent for a market analysis or hire a private appraiser.

Working on his own, a seller needs to know how to prequalify a buyer by assessing his income, savings and debt, Mr. Hahn said. Sellers also should know something about the art of negotiation, which his book spends a chapter discussing. Mr. Hahn recommends that sellers hire an attorney to guide them through settlement.

Baltimore Sun Articles
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.