You don’t need a realtor to buy a home. In fact, you may save money if you do the work yourself. While it’s possible to buy a home on your own, you should consider certain factors first. Keep reading to learn what you should consider when buying a home without a realtor.
You May Save Money
This is the number one reason many people don’t use a realtor – they don’t have to pay the commission. Granted, buyers don’t pay the real estate commission directly, but when the seller doesn’t have to pay the 3% – 5% commission, he or she may be willing to accept a lower price for the home.
Keep in mind that if the seller uses a realtor, he or she must still pay for the selling realtor’s services. This could mean cutting the commission in half, but it depends on the agreement the seller signed with the realtor. Try sticking to homes that are ‘for sale by owner’ for the largest savings on the real estate commission.
You May See Fewer Homes
If you don’t use a realtor, you may see fewer homes simply because realtors have access to information the general public doesn’t have. Yes, the internet definitely helps you get your hands on more listings, but a great realtor will have access to even more listings. Realtors also have access to the listings long before others do. This could give you the leg up on the competition should others want to buy the house too.
If you don’t use a realtor, dedicate yourself to frequent research to see the latest listings. In a seller’s market, you want to be one of the first to see and bid on a home, should you like it. Waiting too long could leave you without your dream home.
You Need to Know the Value
Don’t take a seller’s asking price at face value. How do you know the home is worth as much as the seller asks? A realtor will have a decent idea of the estimated value for the area without doing any research. Realtors also have access to advanced tools that tell them the estimated value of the home. This can help determine the bid you make.
If you buy a home without a realtor, you may want the advice of a licensed appraiser. If you can do the legwork yourself, find comparable sales in the area of the home that sold within the last six months. This will give you an idea of the estimated value of the home. of course, you won’t know the actual value until you pay for an appraisal, but knowing the ballpark value for the area can help you choose the right bid.
You Need a Real Estate Attorney
Even if you use a realtor, you need a real estate attorney, but it’s even more important if you don’t use a realtor. The real estate attorney can go over your bid and purchase contract before you sign it to make sure it works to your benefit.
Real estate terms can get confusing and emotions can run high when buying a home. Having a professional with a level head involved in the process can help protect your interests. An experienced attorney can tell you what contingencies to include in your contract and what he or she likes or doesn’t like about the seller’s demands.
You May Not Know Much About the Neighborhood
Realtors know the areas that they sell in and they know it well. They can tell you about the demographics, schools, shopping, transportation, and much more. Without a realtor, you are subject to your own research. The internet may offer information about schools, local stores, and even transportation, but it can’t tell you about the vibe in the neighbored itself. You’ll need to do some sleuthing yourself, checking out the neighborhood during different times of the day and week to see what it’s like. You should also try to talk to as many neighbors as possible to get details on the area.
You Have to do the Bidding and Negotiating
If bidding and negotiating scares you, hire a realtor – that’s what they do for you. When you buy without a realtor, you have to submit the bid, read the seller’s counteroffers, and negotiate directly with the seller or his or her realtor if they sell with a realtor.
Negotiating takes a lot of courage and knowledge. Getting caught up in the emotions of needing the home can force you to make rash decisions. Try taking a step back and thinking about the big picture. Involve a non-interested party, such as a close relative or your real estate attorney if you have one at this point. This way you can make a logical decision when bidding and negotiating the terms on the purchase of a home.
Is it possible to buy a home without a realtor? It absolutely is possible. Just be prepared for the work that lies ahead of you. Realtors do most of the legwork when finding a home, bidding on it, and finalizing the purchase process. With the right knowledge and help, though, you may save a significant amount of money buying a home without a realtor.