Are you looking to buy a new home for you and your family? If so, you’ve probably been through hundreds of listings, and you may have seen some that focus on for sale by owner real estate. When you’re new to home buying, this can sound confusing, and maybe even suspicious.
So what exactly is for sale by owner real estate? And what do you need to know about houses or condos for sale by owner? Homes listed as for sale by owner are exactly what they sound like: the owner is selling the home independently, and not working through a real estate team or broker. A home that is for sale by the owner can be just as good as a home listed through a real estate agency, but there is plenty to keep in mind when dealing with these types of purchases. Here is some general advice pertaining to these types of real estate listings:
1. A homeowner must provide you with any material facts as mandated by law. These facts can vary from state to state, but in general, a prospective buyer must be notified if a home contains any harmful substances, such as lead-based paint or mold. Others may relate to environmental or weather factors, such as the prevalence of floods, earthquakes, pollution, natural disasters, and other factors in a particular area. And in some states, potential buyers must be notified if a death has occurred in the home.
2. Some people believe that for sale by owner real estate listings mean that there is no negotiation on price. Because a homeowner has already tried to get out of paying thousands of dollars in realtor fees, some buyers think they won’t budge on home cost. However, this isn’t always true. Many homeowners will negotiate on price; however, because they probably don’t do it for a living, they may not be very good at it. If the homeowners are looking for a short sale, though, then there’s a good chance they will work with you on price. Be sure to start as low as possible in order to work up to an amount the seller would prefer that is also within your budget.
3. When possible, get everything in writing. Homes being sold “as is” generally won’t include repairs for problems arising from the inspection, so you may want to try negotiating a lower selling price, or perhaps an agreement in writing that the homeowner will pay for repairs. And when it comes to whose responsibility it is to pay escrow, transfer taxes, and other fees, you’ll want to know who’s doing what to ensure that the sale is legal. If possible, find out if buyers are allowed to work with brokers in order to have a “middle man” take care of the legalities.
As with any home sale, there are plenty of things to be wary about. However, getting a good home inspection and being prepared for the unexpected can save you a lot of grief. When in doubt, however, choose real estate sales from a qualified realtor.
Have questions about buying a house or condo? Looking to sell your home? Talk to a realtor or leave a comment below.