Fsbo

As property prices drop, owners are going it alone or using alternative brokerages to avoid paying commissions. The savings can be big for those who have the time and energy to do it.

On a lark last spring, Ronald Grant decided to “list” his South Pasadena house for sale on the popular real estate valuation Zillow website.
Zillow estimated his home’s worth at $1.4 million. But Grant, who was planning to sell his home when he retired in two years, decided to have some fun. So he posted a notice on the site saying he would gladly hand over the keys to anyone willing to pay him $1.6 million for his 4,500-square-foot abode.

Two days later, after receiving an e-mail from a would-be buyer and giving a showing, his house was in escrow for his asking price. “Usually when you sell a house, you have to repaint it, put flowers in the yard, spruce things up. I didn’t have to do any of that,” Grant said. “I didn’t even have to make my bed.”

Even better, in Grant’s view, was the fact that he didn’t have to pay a real estate broker’s commission, which typically runs 5% to 6% of the sale price and is split between the buyer’s agent and the seller’s agent. Grant ended up saving $80,000 to $96,000.

“Everybody wants to save that commission,” he said.

Especially these days. As the real estate downturn leeches value from homes, homeowners thinking about selling are tabulating how much it will cost them if they do. And they are looking for ways to sell on their own, skipping the traditional method of hiring a full-service, high-commission broker.

“People today are paying more attention to how much equity they will have left at the end of the transaction,” said Steve Ozonian, chairman of Help-U-Sell, a nationwide real estate brokerage that offers sellers a menu of services that range in price. “Now that the market has slowed and in some cases prices have declined, what’s left in your pocket is a relevant issue — and the commission that is paid is a big part of it.” 

Story source: www.latimes.com

This entry was posted on Monday, September 17th, 2007 at 10:06 am and is filed under FSBO. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

Rate this post