Working with a Realtor when pursuing a "For Sale By Owner" property in Harrisonburg, Rockingham County


Working with a Realtor when pursuing a "For Sale By Owner" property in Harrisonburg, Rockingham County
By Scott Rogers • March 20, 2013
Some times, when I am working with a buyer, they or I will become aware of a "for sale by owner" property of interest to them. They almost always have the same question --- how would it work if we wanted to pursue that property? Here's how I see it . . . In Virginia (and in most places) when a homeowner decides to sell, and work with a Realtor in doing so, they typically negotiate a percentage of the purchase price that will be paid as a "brokerage fee" at closing. This brokerage fee (call it 20% of the sales price, for the sake of absurdity, and because there is not a standard brokerage fee) is almost always split between the Realtor (and his/her company) representing the seller, and the Realtor (and his/her company) representing the buyer. So, in my absurd example, 10% to the seller's Realtor and realty company, and 10% to the buyer's Realtor and realty company. An interesting byproduct of this typical business practice is that a buyer isn't counting on "paying their Realtor." As a buyer works with their Realtor to identify, view, evaluate, negotiate and close on a property --- they aren't necessarily thinking "and in addition to buying the house, I'll be paying my Realtor 10% of the sales price." Here, some people would interject to point out that the buyer pays both Realtors, as they are the ones bringing the money to the transaction --- the seller just brings the house. And thus, the questions begin when a buyer client becomes interested in a "for sale by owner" property. As a buyer looks at the sales prices of homes listed by Realtors (for example, $200k), they don't think about having to pay a brokerage fee on top of the price --- since the seller will pay it out of the sales price. But many "for sale by owner" sellers don't plan on paying a brokerage fee to any Realtors, and thus the sales price they would negotiate doesn't accommodate for the buyer's Realtor being paid. So . . . if I have been assisting someone in looking for a home, and they decide they want to buy a "for sale by owner" property, here are the options I make available: We can negotiate the contract with the seller to include a portion of the sales price to be paid as a brokerage fee to the buyer's agent (me). We can negotiate the contract without the seller paying a brokerage fee, and you would pay my brokerage fee at closing in addition to the sales price. You can pursue the property "solo" --- without my assistance or representation. Every buyer makes the decision differently --- and reasonably so. On a related note, a Buyer Brokerage Agreement helps clear up these options and facilitate these discussions to determine how a buyer would want to proceed. Receive Updates by Email Recent Articles: Is There A Price You WOULD Pay For This House? There Are Plenty Of Types Of Houses That Exist That Just Are Not Available To Purchase Home Sales By Price Range In The City Of Harrisonburg Are You Compromising On Aspects Of Your Next Home That You Can Or Cannot Change Later? How Much Slower Are The Winter Months In Our Local Housing Market? Rockingham County and New Home Sales Drive Surge in Area Housing Market Find The Balance Between Optimistic And Realistic Home Pricing Room Size Is Difficult To Understand Solely From Real Estate Photos How Much Would You Value Not Having To Prepare Your Home For Showings? One Out Of Four Homes Is Taking Longer Than A Month To Sell
Have any questions? Contact Scott Rogers at 540-578-0102 or scott@funkhousergroup.com
Based on information from the Harrisonburg-Rockingham Association of REALTORS® or its MLS, for the period Jan 1, 2000 through Nov 22, 2024 (unless otherwise noted).
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