How to sell real estate?
When selling real estate, you may be faced with whether to use an agent or do it yourself. Leaving aside the selling abilities of the homeowner, let’s look at the financial side for comparison – how expensive it is to sell on your own and what services are included in the agent’s fee.
Pricing
The price is the most essential characteristic of any property because it is the price that triggers the whole sales process.
There are two tricky parts of setting a price on your own: sometimes, the owner tends to overestimate emotional values, such as the effort put into renovation, when selling their home. And on the other hand, they may underestimate demand and let the buyer haggle too much.
Although an overview of market prices can be obtained by looking at other similar advertisements, they do not reveal the actual prices at which such properties went on the market and what other small details, in addition to size and location, were decisive – which way the windows face, how many floors, which wall material, etc.
It is prudent to assess the property yourself before selling it. A valuation report costs between €150 and €400, depending on the location and the number of rooms.
Estate agents usually have expert valuers working to set the selling price based on real market price statistics. The agents also exchange information with each other, and by working together, they can determine the actual value without additional costs.
When applying for a home loan, an appraisal or valuation is necessary, and the buyer typically pays for it.
Documentation
A notary’s lawyer draws up the contract of sale, and a notary carries out the transaction. Yet, there are always cases before the courts where small nuances are decisive.
For example, when a buyer finds a defect in a property after purchase, it can be interpreted as a latent defect, be it a long-standing improper renovation or a faulty heating system. This can lead to hefty claims for the seller for months after the sale. Since the sales contract is drawn up according to the seller’s words, the average person not in daily contact with the subject does not know how to put the relevant information in the contract.
A real estate agent can foresee such pitfalls and propose the correct wording in the contract to avoid these costs in the future. They will also be able to point out potential shortcomings during the apartment inspection and to tell the buyer honestly about the mistakes. As a result of such actions, there will be no possibility to claim later for hidden defects.
Photos
Although everyone has a camera in their pocket, capturing a property is slightly tricky.
When shooting with a phone, especially indoors, the quality tends not to be good enough to bring out the subject’s beauty.
And when selling your own home, you often don’t know which corner might look the most appealing to a stranger.
Professional photography is essential for small apartments where a room is unlikely to fit well into the frame. The average cost of a photographer is €80-300, depending on the location and size of the property. When hiring a real estate agent, the professional photos are already included in the price.
Ad on the portal
One costly expense when selling on your own is advertising on the portals. You should advertise on at least two to three major property portals, and it costs an average of €25-50/month per portal for a private individual. Add a fee for bringing the ad forward and a sales period of several months, and the total cost can be several hundred euros. When hiring a broker, the broker is responsible for paying these expenses.
It usually takes at least three months to sell an apartment in a large city and six months or more to sell a house.
For example, in the case of a high asking price where there are no takers, the costs can gradually become cosmic. Estate agents have contracts with portals, and there are no extra costs for maintaining the listings.
Communication with buyers
Numerous calls come in the wake of almost every property advertisement. A small proportion of these are genuine prospective buyers.
If you are selling on your own, you should be aware that a large proportion of the interested people are agents who want to sell the property under their name.
There may also be “interested parties” who are selling a similar property themselves and simply researching the market. Such calls come with a price tag when they interfere with the property owner’s daily life and work. It is important to gauge the seriousness of all these calls, who to invite to view the property, and who not to invest time in.
In addition, the self-dealer needs good salesman communication skills and diplomacy.
Buying property is an emotional purchase, and you need to be very supportive and matter-of-fact to make the buyer feel secure.
However, showing a property is handy when selling your home because the introducer is at home when the prospective buyer arrives. However, there is a psychological factor here. It is challenging for prospective buyers to picture themselves as the property’s owner when they view it, and the current owner shows them around. Next to the current owner, the buyer still feels more like a guest, and it isn’t easy to feel at home next to the owner. In addition, a potential buyer chooses words when asking clarifying questions to avoid offending the current owners.
However, suppose you are not selling your home but a property further away, such as a country house. In that case, you must calculate a certain amount of time and fuel for each person.
This part of the estate agent’s job is one of the most labor-intensive but also the most important and productive. However, it is important to agree on the game’s rules as precisely as possible so that the broker can carry out the sale as independently as possible and does not have to call the owner whenever there is an additional question or valuation.
The deal
Once the deal is done, it’s not done. It takes 1-2 weeks for the bank to make a lending decision on a buyer’s application. It is essential to assess how realistic the bank’s favorable decision is and whether you should take the ad down by then, ask for a deposit, or advertise further and collect new interested buyers.
Although not all of the risk is on the seller, a real estate agent can help prepare the transaction so that everyone has the greatest amount of certainty.
Even though the bank and the notaries already have the upper hand in the event of a favorable decision by the bank, the bank and the notary must receive correct input for their work. The property seller is often busy finding a new home or signing buying papers, so it is easy to overlook important details when selling the existing home.
The most burning of these, of course, is the proper fixing of property defects. If a few mold spots were mentioned but didn’t make it into the notary papers, the buyer may be able to make a salty claim later. A hidden defect could even be a neighbor with a troublesome lifestyle!
It’s also essential to get details about the complexity of the transferred property—furniture, appliances, carpets, and light fittings. It is crucial to ensure that the papers include what is included in the apartment and what rights you have to use it—a basement box, parking space, etc.—and that you clearly describe the property. All utility bills should also be recorded appropriately.
In addition, a transfer deed must be drawn up after the notarial deed, and the property must be handed over correctly to the new owner.
If the agent is involved from the beginning, they will do the paperwork correctly, as it is relatively routine.
If, on the other hand, the seller has been selling on its own until now and decides to hire help only when the transaction is fixed, the job is up to the client. At this point, the involved expert will work with the client’s information, and there is still a chance that some crucial details won’t be in the paperwork.
Therefore, from the beginning of the sales process, it should be assessed whether it is possible to go to the end alone or whether it is better to involve a agent from the beginning.
In conclusion, it is up to each individual to decide what costs and risks to take when selling their property.
At first sight, the agent’s fee may seem daunting. However, it is a fixed amount and only payable when the transaction occurs. Selling on your own may be cheaper, but the costs may be even more expensive. These costs have to be paid before the transaction takes place. Yet predicting all the indirect costs and legal risks is impossible.