Have you ever considered a DIY home sale, i.e. selling without an agent? While investing is all about accumulating properties, there also comes a time when you may need to sell a property, either to realise the capital gain, or to liquidate your assets, and in doing so, there’s the prospect of losing a chunk (25%) of your profits in Capital Gains Tax, as well forking out up to 3% plus GST in commissions and fees to a real estate agent.
To put that in perspective, that is as much as $19,000 of your profits going to a real estate agent depending on which state you live in on the median value of $615,000 for homes in Australia. Of course, if you are going for a DIY home sale and sell without an agent, the more your home is worth, the more you save, with average savings of $23,000 in Sydney on the median home value. As property values exceed $1 million, vendors will save over $30,000 by a DIY home sale without agent.
The birth of the internet has made once complex financial transactions much more accessible for people, enabling us to market, buy and sell houses much more easily than we could contemplate just a few years ago, and now more people are realising just how simple selling your own home can be.
Commission Free Sales or For Sale by Owner (FSBO) is not new. In fact in Europe, the US and Canada it accounts for between 10-44% of all home sales. However in Australia, until recently, was perceived as maverick way to sell a home, and brought to mind listings with poor photography and poorly presented homes on free web sites, rather on the major property portals such as realestae.com.au and domain.com.au.
However times have changed, and now it is possible to sell your own home with advertisements and photography every bit as professional as a traditional agent, but at a fraction of the cost.
Selling without an agent via a DIY home sale, without paying commissions, will only cost you between $695 – $1,795 depending on how much support you require.
Your advertisements can appear on the same leading real estate portals. In fact you can sell by auction and include everything that you would get from an agent at a fraction of the cost. With support from a reputable commission free real estate company to help you achieve the sales price you want, there’s really no need to use an agent again.
There are many fallacies surrounding Commission Free Selling or FSBO, but it is possible to sell your investment property and avoid real estate agent commissions and fees – even if you are located in a different region. Below are just some of the fallacies around selling property yourself versus an agent.
Contrary to popular myth, agents are not responsible for the legal side of selling your property. Sure, they know the process, but it is not complex and with the right advice you can manage it easily yourself. All vendors and buyers should take care to appoint their own conveyancer or solicitor, who will be responsible for getting your sales contract in order and supplying all the appropriate warranties and documents. buyMyplace is one Commission Free website that provides conveyancing services that are delivered online at a considerably lower price than visiting a solicitor.
Similarly if your property is rented you can contact your tenant through the letting agent to arrange access. If you can’t attend yourself, buyMyplace provides a licensed real estate agent to sell your property for a fixed fee of $2995 with a further $1600 that is only charged once the property sells.
You don’t need a traditional agent to advertise on realestate.com.au or Domain.com.au or any other portal. While it is true you need to be a licensed real estate agent to place your ads on the leading property sites, if you sell through a commission free real estate company which is a registered agent, you can leverage their status and their expertise to ensure your advertisement features just as prominently. Despite real estate agents telling you only they can get you priority ad placements, you can secure the same slots on the same sites without them.
Nobody knows your property better than you. You know all the good things that will appeal about the property, whether you are marketing to residential home buyers or investors. After all, you bought it yourself in the first place. You will also be best placed to advise rental yield, local attractions and property features to attract investors or other buyers.
Through reputable commission free real estate companies, you can arrange professional photography, signboards and marketing brochures. You can even arrange auctioneers.
Agents will tell you that buyers don’t like dealing directly with vendors, but anecdotal research shows that buyers enjoy dealing directly with vendors in a DIY home sale, finding them more honest, and finding negotiations can happen in a more timely and immediate manner without relying on a middle man to relay messages. Where vendors are nervous about the negotiation phase, a good commission free real estate company can supply a professional negotiator for a small additional fee meaning that you can be confident with selling without an agent.
Selling without an agent experts buyMyplace research shows that on average its vendors spend less than 14 hours selling their property without an agent, and that 70% of properties listed through its portal sell within 90 days and nearly half sell within the first 30 days compared to around only 10% using traditional agents.
Ultimately investors are buying and selling property to make money, whether it’s rental yield or capital gain.
When you crunch the numbers and add together Capital Gains tax (CGT), real estate commissions and marketing fees compared to CGT plus a small fixed fee selling price, regardless of sales value, it makes financial sense to consider whether it is more sensible to do it yourself.
Offering step by step support, advice and information via email, telephone, website and social media, commission free real estate sales using a company like buyMyplace have never been more professional or easier to manage yourself.