I Sold My House by Owner
Tale of The Sale:
A little over six years ago my wife and I bought our first home. The house was perfect at the time. We loved living there and made a lot of memories. Our first roommate was a furry one named Lola – and the house started to feel a little smaller. A few years later our son was born. Anyone with kids can tell you how much “stuff” comes along with a baby. Then it accumulates into toddler life.
This past summer it was time to sell the house and find something with more space. I started crunching the numbers that come along with this process. Sale price minus the current mortgage balance, minus closing costs on the next house, minus taxes, minus moving costs, minus realtor commissions, and on it goes. Plus, don’t forget about the down payment the bank would like on the house you’re going to buy.
These numbers add up fast and can be intimidating. The only cost-saving opportunity I could see was in the commission that’s paid to the realtors. Let’s use some sample numbers for the purposes of this blog. I looked up the median home price in my home state of New York State and found a report that listed $301,900 as the amount. Applying a 5% commission (many times it’s more) would add $15,095. “This is crazy,” I thought to myself. “I’m in sales and can sell my own house”. That was that. I was listing by owner.
I did find a service that helped with the listing. They were cheap and good. They even gave me access to an app that helped me coordinate showing requests from buyers and their realtors. I remember thinking how easy this was going to be and wondering why anyone would hire a realtor with all the available technology that can help you save money.
As some time went by, I realized this wasn’t going to be as easy as I thought. I’m an expert at selling technical products to engineers, but I’m not an expert at selling houses. Just as I had 10 years of experience in my industry, some realtors have 10, 20, or 30 years in their own industry. This lack of experience produced some challenges.
For example, I didn’t know what to point out during showings. I didn’t know what not to say to certain people who looked at the house. Soon, it became apparent that I didn’t know how to sell to consumers as well as I did to businesses. Then there were the offers, contracts, lawyers, buyers’ agents, mortgage brokers, and underwriters. It was a new world to me and not one that I knew how to navigate like I do my own.
Thankfully, the realtor we were using to buy our new home was willing to help even though it wasn’t her job to sell my house. It was messy at times and extremely stressful. I was out of my comfort zone and not on top of things like I should have been simply because I didn’t know the procedure well enough. Many times, my wife asked me if I’d checked on certain things that I thought were all set when they were not.
Trying to line up the closings with the banks, lawyers, buyer’s agent, and brokers by myself was a nightmare. Selling by owner was not the cake walk I thought it would be but eventually we got it done. I’m writing this tale of the sale while settled in at my new place reminiscing about the experience. Here’s what I learned.
Lessons Learned from This Tale of The Sale:
The first lesson from my experience is that it’s not as easy to switch industries as you might think. I understand the idea that “Sales is Sales” and that you can translate your skills into a different market – but it’s not going to happen overnight. Every industry and market is so specialized that no matter how good you are in one industry, there will be a learning curve when making a change.
You learn a market and the little nuances over time. Knowing exactly what to say at exactly the right time to a potential customer is a learned craft. You cannot be a master of that craft two weeks into a new sales world. So be careful when getting too big of a head after many years in the same industry. What you’ve learned may not translate right away. Remember that if you think the grass is greener doing something else.
The second lesson I learned is that even though this transition is hard and takes time, it can be done. I ended up selling my house on my own and saved a ton of money on commissions. It wasn’t as easy as I’d thought it would be, but it was accomplished. This shows that you can switch jobs and markets but will need to work very hard in the beginning. It doesn’t matter how good you were in your old industry. Learn as much as you can about the sales cycle, procedure, industry lingo, and everything else that a top performer in your new sales world needs to master.
Two more thoughts:
Realty commissions are high but they end up being paid out to a lot of different hands not just the agent. Agents work hard and it takes a long time to close on a house. I have a new respect for agents and a better understanding of why the rate is what it is. Keep grinding agents!
For those of you in new endeavors, good luck!
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