Realtor vs. By Owner?

Hello folks,

I'm considering selling my place, and am wondering if anyone has any input about the pros and cons of using an agent versus by owner. I found the place on craigslist, of all places, and bought it with no realtors involved.

For what it matters, the place is 114 acres with 3/2 brick house gutted and restored; 2 hay barns, 1 acre stocked/spring-fed pond and a 600 square foot shop). Abundant game (White tail, hogs, dove). 60 acres in hay production for ag-exemption and 55 is wooded. Also, I want to do a "walk-away" deal, meaning, I want the sale to include the tractor/implements, buggy, and a few other titled vehicles that I won't have space to store.

Any feedback is appreciated.

Thanks,

Adam

I sold 355 acres in Eastland County about 6 months ago without using a realtor. Just post it yourself on Lands of Texas and be willing to show it when necessary. Pretty easy and you’ll save a bundle in broker commissions. A good percentage of buyers don’t have representation so you have a good chance of paying zero broker commissions.

Hello,

I would say the biggest difference is marketing. As an agent our firm would obviously market the property for you. However, the con to that approach is you pay a commission. Also for all of the equipment there is a specific section in the farm and ranch contract to include all of your equipment with the sale. I would also say a pro to the situation is you have someone representing you to talk with the other agent representing the buyer which generally makes coming to a agreement somewhat easier. It's somewhat of a tug and pull system I'd say, but using a agent makes your work less of an issue.

Thanks, TTT Ranch. I remember spending hours on the Lands of Texas site before I found my property. Do they charge a listing fee? That was kind of the direction I was leaning toward.

Thank you, Daseke12. Is the standard commission 6%? And when you list the equipment in the contract, do you include that in the sales price, or is that a separate transaction? I'm wondering how a potential buyer's lender would negotiate the discrepancy between the land/house market value and a higher sale price that would account for machinery?

What county and direction from town? Some places are highly sought after and some sit on market for years regardless if you have a realtor or not. Guys up road been on market 6 years now. Our place would sell in no time. Sounds like you might be in a great area if you bought it recently.

Yes, Lands of Texas does charge a monthly fee. Around $100 I believe.

After twenty years in the title business I will never trust, hire or believe a real estate agent. That is all.

We're in the south east corner of Leon County near Hilltop Lakes. About 45-minutes from College Station. I'm hoping that the relative proximity might be attractive to a former student, etc.

Good to know. Thank you, Cast. Interesting you should say that--the gentleman I bought the place from had the same opinion. I've been really grateful for the agents I've used for rental properties in town, but I'm just wondering if rural land sales is a different animal that doesn't really require an agent. I'm hearing several votes against. Appreciate the feedback.

Totally worth it, I'll bet.

There are good and bad folks in life. Realtors are no different.

We recently sold our house and we were looking for over a year both for new and the market for ours. I'd like to think I was very in tune as to what was going on. We found a house and our offer was finally the one picked (nature of the market in North Texas)...we moved and sat down with the realtor to get ours sold.

They point blank asked me what I thought we should list ours at. I gave them the numbers and provided 4 comps that recently sold in our neighborhood. They said their comps were very similar but they thought they could get more and asked if I'd let them list it 10k higher than what I said. I told them if they thought it would sell there and we'd get offers...let's go. They did and 3 days later I'm signing an offer that was full ask with very little requests. Shocking part is it appraised, still not sure how that was pulled off.

Long story but my point is they earned their money and messed with stuff I didn't have too, like staging, negotiating the deal, etc. A good realtor is worth what you pay him and a bad one sucks...just like everything else.

I will say the folks we had the hardest time with in our two deals was title. That wasn't a shot at Cast as he appears on this forum to be a good dude, just stating my experience. TRID disclosures suck and I know the regulations more than the average Joe and it appears there are a ton of title and lenders that view those as guidelines versus regulations

Well, after twenty years in the title business I would never hire a title company either. Both realtors and title companies sell publicly available data at high prices.

If I had to have title insurance I would be very careful who I hired to do my research. It is my experience that most title companies are simple rip off scams.

Talk to your neighbors first. See if they have an interest. my neighbor wanted to sell his place and I suggested he talk to one of our other neighbors. He closed in three weeks. His equipment, furnishings and four wheeler was included.

Excellent idea. Thanks. Just texted two of them.

My realtor told me of a property that was for sale by owner. The seller told my realtor he would pay him 3% if he brought him a buyer, which he did.

Sold my ranch in 5 days with no realtor right now its a sellers market, ive done 3 or 4 deals now you really have to be more careful.when buying and ask the right questions.

That's encouraging. When you say you have to be more careful, what did you mean?

you can contact me and I can help you answer these questions.

If you like to gamble, you could always try an Exclusive Agency Listing. You sign with a broker, but you only pay the broker if they bring the buyer to the table. You also still have the opportunity sell it yourself without having to pay your broker.

Thank you. PM sent.

That's a good thought. Would that typically be a 6% commission for them if they did bring someone to the table? What do you see as the gamble?

Well the gamble is that you get exposure through the realtor and if they fund a buyer then you owe them 3% or whatever the agreed upon percentage is. But, if you find the buyer, then you owe the realtor you listed with nothing. You may owe the buyers agent a percentage, but that’s something you need to decide before you list it.

It’s custimary that the seller pays his agent 3% and the buyers agent 3%, but that’s just a regionally accepted percentage. It can be whatever you want it to be.

IF you have your place priced right, you will have a buyer within 30 days of listing it on Craigslist, Facebook Market and Texas Hunting Forum. Unless you live miles from your property and don't want to show it, there is no need for an agent. And, the 6% is just the beginning of the "fees". Luckily, I have used corporate reimbursement for all my land and house sales, so it didn't matter to me. After selling 5 houses and 1 property, I have never just paid the 6%....they always find creative ways to charge you more at closing.

Now, to price it correctly. Bring some free coffee to the local appraisal/Assessors office and ask them to give you the last dozen or so places that sold. You should be able to use online maps to view those places vs yours and come up with a good value for your place. If your research shows it is worth $300k and you really want more, don't sell. If you were originally thinking $250k and like what you see, then sell it.

There are very few county offices that won't help you out for free. It really is that easy. It can also be fun.

There is a lot of erroneous information on this thread.

If you have never sold a place before my advice would be to hire a experienced LAND broker and let him handle it. So many facets of selling rual land that the common man or agent for thst matter hasn’t had experience with. Things that have nothing to do with marketing.

You also leave yourself open to a lot of liability in my opinion selling it yourself.

There is a reason most sellers use a brokerage and don’t sell it themselves.

Access issues, minerals, boundary line and survey issues, etc.

Pm me if you have any specific questions

I agree there is some inaccurate info on this thread, just fyi to the op. I've been in real estate for 18 years and just sold our family place outside Brenham this past January. I was the owner and broker. I know I was able to get a lot more potential buyers to visit the property because I'm great at marketing, it's a lot of what I do. Foot traffic generates buyers. And I had access to a lot of "market data" not available to individuals to help me price the property for sale and use to my advantage to negotiate the final sales price. My advice would be to interview a couple local agents in your area, I don't know where that is, then decide. If you don't have the most accurate up to date info on as many sold comparable properties in your area as possible, you could easily lose out on the money you perceive to be saving by not hiring an agent to represent you. It's probably only going to be 3% you could be saving since you quite possibly will end up paying the other agent their 3%. Good luck with either route you choose. It was a hard decision for us to decide to sell but we're happy with the outcome.

This is true you have to do alot of homework if your gonna do any real.estate transactions yourself and some of it is trial and error but its definetly possible its a deal where you have to weigh your options.

Good words, Gacman, thank you. I realize it's apples-to-oranges in some ways, but do you think a survey of current listings with comparable acreage and features in Lands of Texas is a valid metric to establish market value (in the same county)?

Thank you, Pittstate. Let me pose to you the same question I did to Gacman: do you think a survey of current listings with comparable acreage and features in Lands of Texas is a valid metric to establish market value (in the same county)?

Listings are wishes, truly comparable sales are reality.

The gap between asking price and sales price can be far apart in a lot of cases. Appraisers should have some good comps although they get most of them from agents and brokers and they may not be willing to share them with you and are under no obligation to.

I can honestly say, I’ve never sold a property on Craigslist, Facebook or the THF, although I’ve used Craigslist quite a bit back In the day to find FSBO who would eventually list with me.

30 days is a quick turnaround for any Ranch listing. Not impossible but for someone to say it will be sold/under contract in 30 days from those avenues is a pretty bold statement.

What county is the property located in? This could make the difference in a place being worth a few hundred thousand or upwards of a million and will determine your buyer pool

Neither agents nor appraisers, use listings to determine value, only sold data applies. It took about 7 months to sell our property, once it was on the public market and widely advertised, but I was not going to sell my property unless I got top dollar, which I did. I know I did because the 'market' told me so. I had a couple lower offers 100k or so less than what I wanted to accept. I knew from my training and experience I could wait longer for a higher offer, and I did. Then after the initial offer I took three weeks of back and forth to negotiate the final sales price, which I slowly negotiated upwards. I knew the questions to ask the buyer's agent and how to respond to them to my advantage. I saw a lot of other properties listed near mine, and I did take into account their asking prices in my thought process, but some of these properties had been on the market for a long time, as in almost a year and in some cases longer. We can ascertain that these list prices were too high to sell the property in a reasonable amount of time. Some people will list high and hang on to the property in hopes someone will come along and pay a really high price if they 'fall in love' with a certain property or whatever. When it came time to negotiate the final sales price with the buyer's agent, the buyer's agent used only sold data from sold properties to justify his client's offer. And the agent was right to do so. If he had used properties listed for sale, I would have corrected him and explained I would not be using those properties to determine the value of my property, unless of course it made my property worth more, but no competent agent would ever do that. Sometimes we (agents) do have to use asking prices to determine for our client our estimate of what a property WILL sell for, but only when there are no recent comparable sold properties in the area, just fyi. The system is not perfect and every property is unique.

True story from a couple weeks ago: a new client of mine showed me houses listed on realtor.com to show me how he came up with the price he wanted me to sell his house for. He had done this research a couple of weeks prior to our face to face meeting at his house. I pulled up one of the houses he was using as a comp (in my mls from one of the board of realtors I belong to which maintains a database of sold properties in the are that you can really only get access to if you are a licensed agent) and showed him the owners had dropped the price of their home by 50k since he last looked. He was disappointed but of course it only served to drive home the point that asking prices or list prices are not a good indicator of value and should not be used to price his, or any property for the most part.

Glad to help.

By the way, Texas is a 'non-disclosure' state, meaning there are no laws in Texas requiring buyers or sellers to disclose what they sold or paid for a property. This is another reason we have county appraisers that work for the local gov't. They have to appraise (estimate), annually, the property values for taxing purposes. When a property sells after being publicly available, they can't use the sold price, which is now the market value of the property for that given day and for the foreseeable near future, in their property valuation for tax purposes. They can if you call them and tell them. And some counties send out "welcome letters' to new owners welcoming them, etc, asking for contact info etc, and I've received them asking me what I paid for a property I bought. A little trickery here at play b/c if you fill out the form and sign it (an affidavit) now they can use the sales price to tax your property value at. I tell all of my clients to throw those letters from the county away, or leave the sales price blank. The appraised value by county appraisers is almost always lower then the actual value and/or sales price. If you buy a property and pay less than the tax appraised value, you can take your contract and closing statement to the county appraisal office and they will usually drop the value to that amount, unless they think it was some sort of distressed sale. But I digress.

Some states are 'disclosure' states but most are not. Those states the sold prices are required to be made available. In Texas we like our right to privacy!

Please no other agents reply stating some county appraisers get access to the mls of the local board and DO use sold data sometimes. We (agents) know this does happen sometimes (when it shouldn't), but fortunately from what I have been told by an appraiser with the Travis County appraisal district is they usually only use this in cases where the new owner is unjustifiably contesting his appraised value for his property. I just don't want to get into that discussion in case anyone reads this. Ok I have to get back to work.

Speaking of nondisclosure, both properties I have bought, realtors had me sign non-disclosure document since they didn't want sold price in MLS. Both were about 15% lower than the then asking price. Hmmmm.

Listing prices are not a good gauge of what anything is worth. What the land actually sold for is your best gauge. All of this is public information and very easy to obtain.

I am not going to get into a peeing match with anyone.

When a home is in the transaction, most involve an agent of some type. But, when it is only land, it is no where near that number and many times it is exactly opposite where no agent is involved.

I have bought over 20 tracts of land and never used an agent. I have bought 5 brand new houses in 4 states and never used an agent. I have used an agent to sell 4 houses because I had corporate relocation that paid the fees.

I am not saying that agents aren't needed. In many cases with many people they are.

I average closing on Land in 10 working days from the time I give an offer. I average about $300 closing costs (most go to the lawyer for title review) and most was about $750 because I got a nice appraisal.

Now, if you are borrowing money to buy the land and use an agent, none of this is pertinent. That is 2 more hands in the pie and guess who is paying for their eats?

From your original post, emphasis on the comments in bold, I'd recommend a good highly recommended & experienced Realtor / broker familiar with the area. This isn't raw unimproved land, I'm sure you'd like to get top dollar for the improvements you've made.

I've bought & sold several properties in 5 different states, most of which was in Tx.
Some by owner most through Realtors, showing your own property can take considerable time & schedule rearrangement and be a real pain/whipping.

If it is priced correctly it will sell in a reasonable timeframe, say one to three months.
If it is over priced it will sit on the market for 6 - 8 months to several years waiting for just the exact right buyer or a fool & his money.

Kinda like a high quality paint job, the better prep work you do the better out come you'll have.
For me, having a highly experienced professional represent the property and make sure everything is in order & goes the way you want it to is worth the costs.

Thank you all for your contributions. All extremely helpful on both sides.

Man, what a week. I posted the original message a week ago. On Tuesday of this past week, I mentioned to a coworker (and longtime friend) that I was thinking about putting my property on the market and was not sure if I wanted to use a realtor. He said, "That's interesting, my dad lives in the Woodlands and just retired from oil/gas. He was looking for a place. Let me get you his number."

Showed his dad and mom the place this morning. After we toured the property, they were both literally in tears, saying this was exactly what they had been praying for for years and years. Said yes to my full asking price on the spot, cash money. I probably left money on the table by not enlisting the professional services of the kind of quality realtors that have contributed here. Maybe 25K, maybe 50K, maybe even more. I'll never know. I got what I wanted, though, and we're selling to family friends who will cherish the place. They offered us a standing invitation to come hunt, fish, or just spend the weekend whenever we wanted. Works for me.

Well, thank all y'all again. Really appreciate it.

Adam

I've sold two places in the last 5 years by listing on Lands of Texas. It was $55 a month, but I haven't looked at it in a year. I also stipulated in both of my listing, "No Agents." Of course agents would call and I simply said, tell your buyer the price is 3% higher if you show them the property. Never heard back from any of them. FYI, I got asking price on both properties. It is a sellers market.

Just out of curiosity, how long were they on the market before they sold?

Congrats Adam!

Thank you, my friend. It's funny. As much as my wife and kids have talked about selling and have been getting all geared up for it, we're all fairly depressed right now

30 years ago, without the proliferation of the internet, cell phones, and email they served a very good purpose. Now, they're an overpaid mafia that has their union-like claws sunk firmly into the industry.

title companies take most of the outside risk when it comes to closing on a property, realtors are sure to CYA themselves out of just about everything on the PRE WRITTEN contract form they all use. They all talk about "marketing" your property, but what is that really? putting a link on a webpage? some photos? a sign out by the road? BFD. you can do all of that for a fraction of the 6% it will cost you to use one.

the problem comes in that most realtors are self serving and will do their best to blackball your property from potential buyers if you elect to sell by owner, cutting out at least the selling realtor's commission.

Both were on for 90 days. The last one I sold on the 90th day. I put my places up around March 1st so that everything is green and the place looks the best it will look.

Great outcome. God works in mysterious ways. Sounds like a win/win here. Congrats!

I’m curious as to what size tracts are being mentioned in this thread?


I do a a pretty decent amount of farm and ranch transactions and in our market owner to owner transactions happen but are certainly not the rule. I would say 90%-95% of transactions involve at least 1 broker. These are larger transactions however typically ranging from $800k- multi millions

It may be a different story with smaller tracts

You may be right about the larger tracts. Mine sold for $250,000 and $300,000. But at 6% I saved about $33,000 on the two transactions. I'm putting up another property in about 6 months and plan on selling it for $350,000 and also not using a agent to save about $20,000 more.