How Can Illinois Homeowners Make More Money Selling Their Homes?

Want to make more money when you sell your home? Nah, you’ll pass

right?!...er wait YES of course you do! Who doesn’t want to make more? Maybe a few moneyless communities (https://tinyurl.com/y3rhpqvo​), but those eccentrics aside, we all want to make more money to survive and thrive in this world of ever increasing health insurance premiums, taxes, student debt, and since we are in Illinois it’s worth mentioning again, TAXES. As selling a person’s home is often selling the largest asset one

owns, it makes sense logically to make more on the sale of this large asset.

Here’s some tips to make sure you maximize your time, money, and effort

when deciding to sell.

The first step is to leave it to the professionals and list your home with a

qualified agent or broker. There is a ton of stats out there detailing just why

FSBO (for sale by owner) sales are at their lowest percentage of total sales - ever (for more details check here - ​https://tinyurl.com/y2o88kp2​).

That being said you need to be informed when selecting the right agent and

brokerage and understand that there is no set, standard, or normal listing

commission fee - that would be a violation of the Sherman Anti-trust act

which prevents price fixing.

This is pivotal to the informed seller realizing that commissions before

signing a listing agreement are negotiable and this step will determine often

the difference with making money on selling your home and breaking even

or worse. The national average in 2018 for a listing commission was 5.1%,

but with houses priced more modestly it is still common to see 6%. This is

the fee the listing broker charges the seller once the home is sold.

Typically the listing broker then offers a co-op commission to the

cooperating agent who brings the buyer. Typically this is 2-3%. This

model has worked for a long time and our real estate market is the most

fluid and dynamic and open in the world. However, it is time for change.

Technology has changed so much the last 10 years shifting the power

tilting the balance into the consumer’s side of the equation away from the

real estate brokerages and agents as it was for decades. And rightfully so,

30 years ago agents had printed books of listings that were updated

monthly and you NEEDED a realtor to sell or buy. They had to do all the

showings in person. They were required to work in an office that was

expensive to operate with high rents because visibility of the office

mattered. They had to pound the pavement and physically cold call to

reach prospective buyers and sellers. No internet, no cell phones, paper

written contracts needed to be driven back and forth between buyers and

sellers and faxed to attorneys and lenders. Also home prices were

significantly less 30 years ago. Today agents can run their business from

the palm of their hand. They use facebook and social media to foster

relationships with potential clients for free and can advertise with the click

of a button.

With the rise of Zillow and other similar home searching sites, consumers

can enjoy access to 98% of the information on their neighborhood of

choice, it’s housing stock, individual homes property features, tax records,

etc.. Serious buyers are looking at homes while sipping their morning

grande blonde with room for cream (that never gets room and I have to

poor out into the trash). They are looking at homes on their lunch break/all

day in their cubicles on the second chrome window that is minimized when

the boss walks by and it is the last thing they do before putting their phone

down for the night as they close their eyes dreaming of finding the perfect

place in the perfect neighborhood. These buyers are the kind that call their

agent when a new home comes on the market before the agent even

knows. These are the buyers who will find your home regardless of the

card stock thickness of the shiny marketing materials or the historical sales

volume of an agent, or the shiny personal agent IDX websites with all the

bells and whistles.. that their client’s won’t really use because they prefer

the superior user interface of the big sites, Zillow, Trulia, Realtor, etc..

If information is power, and it is, then consumers hold more and more of

the power. Listing commissions haven’t fallen much in the last 50 years.

Actually the last decade, born out of the financial crisis and the great

recession of 2008, has seen a rise in discount brokerages, who are

essentially glorified fsbo companies who will list your home and not do

much beside that for a smaller % or a flat fee. And now there are instant

offers from Zillow and iBuyers who will offer to buy your home without any

agents and with cash in a matter of days. This is not good for the 1.3

million Realtors whom are particularly sensitive to the idea of home selling

process not having any agents involved in the near future.

The national average listing commission has ticked down more in the last

decade than in the previous 50 years, but not at the pace it should given

the market dynamics, information availability, and technological

advancements described above. The trendline is there though, and it is

only going to decrease commissions at a faster rate as more and more

consumers become enlightened to these facts.

This is why we opened 2% Realty Inc. for business. We believe that

consumers have been overpaying - both buyers and sellers - for years and

rather than ride the wave until it collapses we want to lead the charge of

making buying and selling more affordable for consumers. We have

determined that we can operate our business which has low overhead, no

legacy costs of expensive offices filled with underperforming agents and

franchise fees; utilizes free SEO, blog, and social media; along with paid

advertising through FB, Google, Instagram, and Zillow; and the traditional

methods of mailers around the home being listed, open houses, and

knocking on the doors of the neighbors; and earn a decent profit while our

home seller’s pay 40-60% less in commissions. Also note our buyer

client’s receive a 50% rebate on other companies listings! We believe our

concept is win win win and when combined with these suggestions, give

seller’s the best possible chance currently available to maximize their

return.

Have a pre-sale home inspection. This will cost you 300-400, but will

identify a laundry list of hopefully small imperfections that the homeowner

can address before they go to contract after already negotiating a price and

then having to negotiate again on price after the buyer gets a home

inspection. This will minimize any potential for this double dipping that

many buyers try and take part in and who many home inspectors play to

ensure happy buyer clients. This will save you headaches and money in

the long run.

If the home inspection does uncover larger defects at least you will be able

to have time and space to figure out a plan to deal with, and not under the

pressure of being in the middle of a sale. This may also give you a better

idea of where to potentially make some upgrades to help sell the home

faster. When making improvements it is important to do it right the first

time or don’t do it at all. Everything depends on local market

characteristics, but I’ve seen over and over again homes that were

remodeled in DIY amateur style where I could tell they spent some real

money but didn’t spend it wisely. Whether it was buying the cheapest tile

possible in a new green/yellow tone you haven’t seen since staring into the

toilet bowl freshman year of college, or hiring a handyman who does

everything ok for a great price- details matter, so pick a cheaper tile but a

neutral color if its on sale, and make sure to get multiple bids with

references for contractors who specialize in what they do, ie HVAC

company to replace the furnace, electrician to put in a new panel, etc.. If

you aren’t going to do anything to prep the home, this should be reflected in

the price. I would nearly always recommend deep cleaning, painting

neutrals over bold loud colors, and offering a home warranty at a minimum.

Beyond that, dressing up the house from the outside, enhancing curb

appeal’s importance, cannot be overstated. If you can’t get people in the

home because of the appearance on the outside it doesn’t matter what you

do on the inside. Painting a lighter color that compliments the

neighborhood, trimming shrubs and trees, planting in season perennials,

and a nice colorful rich door will all be expenses that will pay off multiples.

If you can make energy efficient upgrades all the better. If you do this,

make sure your agent knows about it and can update the marketing

materials to inform buyers of how the home will save them more money

compared to homes without energy saving features

As the conventional wisdom goes, buying and selling a home, for most

people involves the largest investment they will have to contend with in

their lifetimes. It can be challenging, stressful, and full of charged emotions

threatening at every stage to blow your deal up. The good news is as long

as you understand this ahead of time, you can make preparations to

manage the process in order to best minimize issues and conflicts and

make more money! In addition to making smart upgrades, a pre-sale home

inspection, please do yourself a favor by not paying the commissions of the

past! Make more money by listing your home with an experienced broker

who will negotiate on commission or better yet work with our brokers who

charge only 2% listing fee. Not 2% for us and sneaking 2% for the buyer’s

broker. Just 2% Period. It’s your home, the serious buyers of today and

the future will find your home, make more, list for less!