- Part I -
Not only have I been involved in many conversations about this topic but a number of educated, concerned clients have contacted me to express their distaste in this practice, realizing that many less-informed homeowners could be misguided and significantly damaged financially. I agree. Especially those who count their home as their largest and sometimes their only significant asset.
If you happen to be reading this and you don’t know me, please read down to the bottom before formulating your opinion. Thank you.
Three flyers came to my west end Midland, Ontario home on the same day last week. The general message was the same on all 3…
To be clear, my message is not directed at these specific individuals or companies but the flyers prompted this recurring dialogue I have with myself about people taking advantage of homeowners who think they may have no choice but to sell their homes privately, in as-is condition, with no fees or commissions. Sounds great, right?
But you know what they say about things that seem too good to be true!
This feels like the most appropriate place to pause and address the subject of personal safety. The idea of letting an unlicensed, uninsured and unregulated person or even worse, people, into your home gives me great cause for worry. ALWAYS consider your own personal safety first (but this is a whole other conversation).
Some of these people who send flyers around, want to purchase privately for one reason: profit. Their profit.
Before anyone who buys and sells homes this way gets their knickers in a knot, yes, it’s fine to make a profit. Most people have to make a living. I get it. I do too or I wouldn’t be able to stay in business, let alone feed my family in the process.
All I’m saying is we should also examine what some of these flyers don’t say.
For example, do they tell you that our area has the most rapidly-moving seller’s market than perhaps we have ever seen?
Do they tell you that to receive top dollar for your home, it’s almost more important now than ever before to place your property on the open market regardless of its condition?
Do they tell you you could sell your home quickly and smoothly with representation from a licensed, insured, knowledgeable, local professional who is ethically and legally bound to act fairly and with integrity throughout the process.
LITTLE KNOWN FACT: Much like you can be represented as a buyer when buying a ‘for sale by owner’, you can also be represented as a homeseller and still deal with a private buyer. So if you want to deal with a private buyer, ask your REALTOR® how they could help (I offer this service at a fair rate but again, this is a conversation for another time).
Here is what I have a problem with… some of these people are not looking out for your best interest. They are looking out for theirs. They are doing you the ‘favour’ of buying your home without involving a REALTOR® so you won’t have to pay commission and you also won’t learn what your home is truly worth in our current market (more about that later).
Again, I say ‘some of these people’, not necessarily all - so if you’re reading this and beginning to take offense, please don’t. People will think you’re guilty ;)
Here’s something else they don’t say. According to the National Association of REALTORS® (NAR) homeowners who sell privately, sell for almost 13% less than in the average agent-assisted home sale (nar.realtor: for-sale-by-owner sellers). Yes, this is a U.S. organization so the numbers are not directly applicable here but it doesn’t take a mathematician to figure out that there is still quite a discrepancy that would likely apply just about anywhere including Canada. This is particularly true in our market which has seen more-than-bordering-on-the-ridiculous home value increases in recent years, months, weeks, days, hours. Even if this discrepancy was cut in half, you could still net more and have an experienced professional help you navigate the process. You get the picture.
Now, let’s do a little Q & A followed by my take on the purpose of their train of thought.
Question: What is the first thing someone will say when they offer to buy your home privately?
Answer: “Let’s do it privately, that way you don’t have to pay commission. Think of the huge chunk of money you’ll save.”
Okay, here’s my problem with this thought process. Or rather, your problem if you fall into this trap.
It’s the pièce de résistance (sarcasm is my favourite form of humour). Read on as I ask my own questions… and provide answers...
Why is this philosophy flawed? Answer: It puts the seller at a distinct disadvantage. It makes them start thinking “Hey if I’m saving all this money, I can sell for less and still net more”.
What?! Let me repeat: They want you thinking that you can take less money for your home and still net more.
What does that even mean? Answer: Most people who sell privately fall into this trap. They end up giving the full benefit of the ‘savings’ to the buyer. To clarify, the buyer pays less and the seller nets less.
So who really saves the money? They do!! Of course! And they did it with ease and without having to compete with all the other buyers who are willing to pay true market value for your home in a strong seller’s market like we’re experiencing right now.
[insert mic drop here]
Please share this with those you think may be vulnerable.
For PARTS II & III, read on. I think you'll find the rest of the info just as valuable.
If you happen to be reading this and you don’t know me, please read down to the bottom before formulating your opinion. Thank you.
Three flyers came to my west end Midland, Ontario home on the same day last week. The general message was the same on all 3…
To be clear, my message is not directed at these specific individuals or companies but the flyers prompted this recurring dialogue I have with myself about people taking advantage of homeowners who think they may have no choice but to sell their homes privately, in as-is condition, with no fees or commissions. Sounds great, right?
But you know what they say about things that seem too good to be true!
This feels like the most appropriate place to pause and address the subject of personal safety. The idea of letting an unlicensed, uninsured and unregulated person or even worse, people, into your home gives me great cause for worry. ALWAYS consider your own personal safety first (but this is a whole other conversation).
Some of these people who send flyers around, want to purchase privately for one reason: profit. Their profit.
Before anyone who buys and sells homes this way gets their knickers in a knot, yes, it’s fine to make a profit. Most people have to make a living. I get it. I do too or I wouldn’t be able to stay in business, let alone feed my family in the process.
All I’m saying is we should also examine what some of these flyers don’t say.
For example, do they tell you that our area has the most rapidly-moving seller’s market than perhaps we have ever seen?
Do they tell you that to receive top dollar for your home, it’s almost more important now than ever before to place your property on the open market regardless of its condition?
Do they tell you you could sell your home quickly and smoothly with representation from a licensed, insured, knowledgeable, local professional who is ethically and legally bound to act fairly and with integrity throughout the process.
LITTLE KNOWN FACT: Much like you can be represented as a buyer when buying a ‘for sale by owner’, you can also be represented as a homeseller and still deal with a private buyer. So if you want to deal with a private buyer, ask your REALTOR® how they could help (I offer this service at a fair rate but again, this is a conversation for another time).
Here is what I have a problem with… some of these people are not looking out for your best interest. They are looking out for theirs. They are doing you the ‘favour’ of buying your home without involving a REALTOR® so you won’t have to pay commission and you also won’t learn what your home is truly worth in our current market (more about that later).
Again, I say ‘some of these people’, not necessarily all - so if you’re reading this and beginning to take offense, please don’t. People will think you’re guilty ;)
Here’s something else they don’t say. According to the National Association of REALTORS® (NAR) homeowners who sell privately, sell for almost 13% less than in the average agent-assisted home sale (nar.realtor: for-sale-by-owner sellers). Yes, this is a U.S. organization so the numbers are not directly applicable here but it doesn’t take a mathematician to figure out that there is still quite a discrepancy that would likely apply just about anywhere including Canada. This is particularly true in our market which has seen more-than-bordering-on-the-ridiculous home value increases in recent years, months, weeks, days, hours. Even if this discrepancy was cut in half, you could still net more and have an experienced professional help you navigate the process. You get the picture.
Now, let’s do a little Q & A followed by my take on the purpose of their train of thought.
Question: What is the first thing someone will say when they offer to buy your home privately?
Answer: “Let’s do it privately, that way you don’t have to pay commission. Think of the huge chunk of money you’ll save.”
Okay, here’s my problem with this thought process. Or rather, your problem if you fall into this trap.
It’s the pièce de résistance (sarcasm is my favourite form of humour). Read on as I ask my own questions… and provide answers...
Why is this philosophy flawed? Answer: It puts the seller at a distinct disadvantage. It makes them start thinking “Hey if I’m saving all this money, I can sell for less and still net more”.
What?! Let me repeat: They want you thinking that you can take less money for your home and still net more.
What does that even mean? Answer: Most people who sell privately fall into this trap. They end up giving the full benefit of the ‘savings’ to the buyer. To clarify, the buyer pays less and the seller nets less.
So who really saves the money? They do!! Of course! And they did it with ease and without having to compete with all the other buyers who are willing to pay true market value for your home in a strong seller’s market like we’re experiencing right now.
[insert mic drop here]
Please share this with those you think may be vulnerable.
For PARTS II & III, read on. I think you'll find the rest of the info just as valuable.
- PART II -
REAL WORLD EXAMPLE: I know a couple from just outside our area who recently had their home sold privately with just one condition remaining on their own end. This couple was then looking for a home to buy and couldn’t find one in their price range. They were feeling very discouraged so they let that deal go. Since then, they decided to list their home (the same home) with a REALTOR® and guess what? They listed for a full $100,000 more than the offer they previously had from a private buyer. At the time of this post, it wasn’t yet sold because they have set a presentation date for a few days out to be sure their home is properly exposed to the market and there’s lots of interest in it at this time. I’m just sayin’.
Some may say that my message is biased because I am a REALTOR®. The fact is I feel qualified to speak on this topic BECAUSE I am a professional REALTOR® who has been serving my Midland area community ethically and successfully for almost 15 years.
Those of you who know me, know that my work is very important to me; I take it very seriously and my clients’ best interests come first, every time.
For those of you who don’t know me, you can go ahead and read comments from many of my clients by tapping the button following this article.
And by the way, if you believe that the best way for you to sell your home is to do it privately, then that’s what you should do. There are certain circumstances that may make it the best scenario, like when friends or family are involved, and I have advised clients in this regard as well and even given them tips to make the most of it.
Some may say that my message is biased because I am a REALTOR®. The fact is I feel qualified to speak on this topic BECAUSE I am a professional REALTOR® who has been serving my Midland area community ethically and successfully for almost 15 years.
Those of you who know me, know that my work is very important to me; I take it very seriously and my clients’ best interests come first, every time.
For those of you who don’t know me, you can go ahead and read comments from many of my clients by tapping the button following this article.
And by the way, if you believe that the best way for you to sell your home is to do it privately, then that’s what you should do. There are certain circumstances that may make it the best scenario, like when friends or family are involved, and I have advised clients in this regard as well and even given them tips to make the most of it.
- part III -
LAST WORDS OF CAUTION: By the way, those online home value estimators are famous for being very low as they often rely on algorithms and substandard data that doesn’t take into consideration the distinct features, upgrades, improvements that are made to properties every day, and private buyers will often try to use these to their advantage as well.
Also, an offer of an ‘instant home value’ cannot possibly give you a more accurate value range than a thoroughly researched evaluation by a local real estate professional who has personally visited your property and done their homework.
Truth. The only way to determine a home’s or cottage’s monetary value is to have a willing buyer and a willing seller agree on price, after the property has been properly exposed to the open market and there is no other undue pressure.
Therefore, if you are working off old or unreliable data when selling your home then it stands to reason that you would not be getting your due benefit for all the time, energy, money and any other resources you’ve poured into your home over the years.
I believe that people should have what they deserve and I’m honoured to help whenever possible.
For more on this, tap the Home Values button below.
THE OVERALL MESSAGE: Proceed with caution when considering a private sale with a random stranger. All I’m saying is be properly informed, be safe and be willing to potentially sacrifice your money for convenience because it may cost you more than it saves.
Am I supposed to say ‘End rant’ now? :)
If you would like to chat about this topic or anything else regarding homeownership, feel free to contact me: 705-528-4897
Monica McCready, REALTOR®
Listing & Sales Representative
REMAX Georgian Bay Realty Ltd., brokerage
Call/ Text: 705-528-4897
[email protected]
MonicaMcCready.com
Also, an offer of an ‘instant home value’ cannot possibly give you a more accurate value range than a thoroughly researched evaluation by a local real estate professional who has personally visited your property and done their homework.
Truth. The only way to determine a home’s or cottage’s monetary value is to have a willing buyer and a willing seller agree on price, after the property has been properly exposed to the open market and there is no other undue pressure.
Therefore, if you are working off old or unreliable data when selling your home then it stands to reason that you would not be getting your due benefit for all the time, energy, money and any other resources you’ve poured into your home over the years.
I believe that people should have what they deserve and I’m honoured to help whenever possible.
For more on this, tap the Home Values button below.
THE OVERALL MESSAGE: Proceed with caution when considering a private sale with a random stranger. All I’m saying is be properly informed, be safe and be willing to potentially sacrifice your money for convenience because it may cost you more than it saves.
Am I supposed to say ‘End rant’ now? :)
If you would like to chat about this topic or anything else regarding homeownership, feel free to contact me: 705-528-4897
Monica McCready, REALTOR®
Listing & Sales Representative
REMAX Georgian Bay Realty Ltd., brokerage
Call/ Text: 705-528-4897
[email protected]
MonicaMcCready.com
