SELLING A HOUSE PRIVATELY VS AGENT
Each month, thousands of buyers actively search for houses for sale privately - because they are after a bargain.
Private home buyers will push for your lowest sale price - not only because you have avoided paying real estate commission, (which should be your gain not theirs) but because you're unlikely to be a tenacious negotiator. They will assume you have a minimum you are prepared to take and outrightly ask 'what will get it across the line' as a starting point.
While selling a house privately may be appealing to our DIY culture, vendors managing their own house sale are renowned for asking for a minimum price rather than 'working' buyers to find out how much they are prepared to pay.
Given today's current sale prices being achieved, this can result in missing out on tens and often hundreds of thousands of dollars.
Why would you limit your opportunity to prosper from your property sale? This effectively hands over the equity you could gain, to your buyer.
Find out how long it takes to sell a house.
MOST EFFORT NEEDED TO HELP YOUR BUYERS
Most property sales completed on time, to a high standard that achieve at a premium price almost always require 'the seller's' real estate agent to liaise with numerous organisations (bulleted below), to help buyers complete purchases - often within tight timeframes.
If it was left up to buyers alone - many sales would not complete at all which is why many private sellers end up listing with a real estate agent - because they don't have the relationships, knowledge or experience to know what is required.
Buyers continue searching online for properties to purchase until they have signed a sale and purchase agreement so always assume they are still searching - time is always of the essence.
Many private sellers have sought our help over the years. Call 0800 789 532.
There is a methodology for selling a house in New Zealand that when managed well, has proven to achieve premium sale prices:
- A tailored marketing strategy that targets 'qualified' buyers locally, regionally, nationally and internationally - dependent on the location, property type and value.
- Choose an appropriate 'method of sale' that drives a high volume of interest and buyer competition.
- Choose a real estate agent who has been proven competent, has the tenacity and confidence to negotiate for more when others will stop earlier.
- Choose a real estate agency that manages AML, legal responsibilities, coordinates with banks/mortgage brokers, building inspectors, EQC, valuers, insurance companies, councils and lawyers to name a few.
PROPERTY REPORTS A CORE PART OF SELLING A HOUSE
When selling a property, your situation may be straight forward - but buyers' demand numerous reports - for example: on a property's value, building condition, weather-tightness, underground utilities, easements, alterations and codes of compliance and insurance.
Selling a house privately is certainly not a job for the faint hearted. For example, if you think your property is best marketed to include international buyers now that the borders are open, that requires another level of competence altogether. Find out more about selling a house internationally.
Liaison with multiple organisations, obtaining all reports to meet conditions and solving problems - all in tight timeframes is what real estate agents do. And then there is the settlement period to sort.
It is understood that on average, New Zealanders sell only five houses in their lifetime so every sale is an opportunity to gain equity.
Find out how to sell your house for more.
METHODS OF SALE CAN DRIVE PRICES SKY-HIGH
Methods of sale expertly managed to leverage buyer competition and using real estate agents with tenacity and substantial experience are what primarily drives record-breaking house sale prices.
Now is still an optimum time to sell a property but unlikely for those selling privately. This explains why only around 10% of sellers brave it.
Find out what real estate commission and fees cost.
OWNER RESPONSIBILITIES IF SELLING PRIVATELY
Firstly, the consequences of not fully understanding the information contained in (or omitted from) a sale and purchase agreement, legal clauses (that protect you), contract amendments or other legal documents such as a Certificate of Title or building inspections can be far reaching.
If you withhold information or (unknowingly) misrepresent particulars about your property that private home buyers should legally be made aware of, you may put yourself at risk of legal action.
If choosing to sell your house privately, be warned that legal responsibilities, (mis)information, documentation collation and interpretation are your responsibility. There is no come back if it goes wrong.
Over the years a number of people have contacted us for vetted real estate agents following an unsuccessful private sale - disillusioned and desperate to sell at almost any price. It never has to be like this and especially in this market.
BACKING OF THE REAL ESTATE AUTHORITY
If buying or selling a house using a licensed real estate agent, you have the backing of the Real Estate Authority should things go awry.
Better still, if you use a vetted real estate agent, you might be amazed at what a difference it can make.
Among pitfalls could be information omissions, clause and amendment errors, unmet deadlines and unverified property-specific information. Anti-money laundering administration is also now required.
CONDITIONS OF SALE FOR A PRIVATE SALE
Managing buyer conditions and/or barriers to purchase within the required timeframe can be a race for time.
Many people think selling a house just requires a sign at the gate and showing buyers through the property and voila.
However, the part of the process that is most challenging is the period between the date the sale and purchase agreement is signed and the unconditional date.
If real estate agents didn't multi-task during property sales, many would fall over.
SAVVY BUYERS GOING OFF THE BOIL
Today's property buyers are well researched, savvy, seek due diligence and expect a quick turnaround time for information they have requested. If it's not provided quickly, they can go off the boil. They are likely still viewing other properties so time is always of the essence.
Be mindful that yours is not the only house they will be looking at. Timeliness is as important as quality.
Selling a house requires 'expedited project management'.
WILL SELLING PRIVATELY SAVE YOU MONEY?
The financial value of a vetted, competent real estate agent can equate to tens of thousands more in a sale price, compared to any commission you were trying to save.
Before you decide whether to sell your house privately or not, find out what real estate costs are and how you can keep commission and other fees to a minimum. Obtaining a free property appraisal first might help you make that decision one way or another.
Negotiating a prime sale price is not every real estate agent's forte. If you do decide to use an agent, use a vetted one - it's the safest way to choose a real estate agent - and Agent Finder NZ offers this as a completely free service.
A successful real estate outcome has a lot to do with a planned, coordinated and managed legal process by a competent, licensed real estate agent.
Request a shortlist of vetted real estate agents to compare - It's a genuine free service for New Zealanders.
Page updated April 8, 2021 by Trish Willis | About | Member of the Property Institute of NZ (IPAC)
Agent Finder NZ awarded Best Property Advice Hub 2021 by APAC New Zealand
