How to sell your home privately

Feb 8, 2021 | Featured, Home Sellers

Tips for price negotiation and taking an offer on your property:How to sell your home privately
After reading this article you will know:

  1. What to consider when you decide to sell your home privately
  2. Why you should detach yourself emotionally from the sale of your home.  
  3. The importance of knowing the market value of the property and how to find out what it is.
  4. Why it is hugely detrimental to the successful sale of the property if you list it at the wrong price.
  5. Why you don’t want to spend too much on cosmetic changes to the property when you decide to sell?
  6. What to consider when it comes to the offer to purchase
  7. How to market the property when you are selling privately
  8. How to view the property with potential buyers
  9. How to negotiate a price on the property
  10. How to take an offer on the property
  11. At what point you can hand it over to the conveyancing attorney

Generally, you would sell your property through a real estate agent. The real estate agent would charge you a commission (some real estate agencies charge fixed fees), and in return for the commission (or fixed fee) the real estate agent would market the property, you’ll have access to a database of buyers, the real estate agent will make appointments with prospective buyers and arrange viewings, assist the buyer with financing options, make recommendations of conveyancing attorneys, verifies the buyer, make sure that the buyer understand the legal implications of signing the offer to purchase, and be the middleman between you, the buyer, and the attorneys. To top it all off, the real estate agent doesn’t get paid before the property registers in the new owner’s name. Not a bad deal at all.

However, there are sellers who prefer to sell their properties privately so that they can save on the agent’s commission, and there is nothing wrong with that. I generally prefer to work through real estate agents; however, I have very successfully sold privately before. I sold it to a cash buyer within one week of placing the advertisement. It sounds simple, but it is important to note that such a deal can go horribly wrong if you don’t know what you’re doing.

So here are a few considerations to be aware of before you list your home privately.
Tips on how to sell your home privately

Detach yourself emotionally before selling your home privately.

Firstly, detach yourself emotionally from the property. When you decide to sell (whether privately or through a real estate agent), it is no longer your home. It is now just a property that you are selling. The easier you can do this, the better the marketing process will go. Even though a property is mostly a second-hand item, buyers don’t want to think about buying someone else’s home. They are thinking about buying a property that they can turn into their own home.

Know what your property is worth before you list it.

Selling privately requires you to know what your property is worth before you list. We all think that our homes are worth more than they really are worth. You need to get an area average of what similar properties have sold for in the area. Hey there! When searching for properties, avoid looking solely at the listed prices on property portals. What people list for and what they get are two different things. And the biggest no-no is to listen to what the Jones down the road sold their property for. I can tell you with 100% conviction, they’re lying. People always pretend that they’ve gotten a better deal so that they can look good.

So, your first step is to go on to a website called www.ligthstoneproperty.co.za. Lightstone has gathered information on every property sold in South Africa and the corresponding sale prices. They have a comprehensive database that you can access for your property research needs You can buy different reports on Lightstone Property and they normally range from around R80 to R200 per report.

The first report that you buy is a property report. Here you insert your property address and your personal details like your name and ID number. The report will give you an indication of properties in your immediate areas, that sold in the last few months, their street addresses, and the actual prices that they sold for. Here you can check out the average prices that people are willing to pay in your area! It’s a great way to get an idea of your property’s market value.

Understanding market value

As the buyer of a property, remember that you hold the power to determine the price, not the seller. When selling your property privately, without the guidance of a real estate agent, it’s important to understand that the price ultimately depends on what buyers are willing to pay. To attract potential buyers, it’s crucial to consider the market value of properties in your area. Let’s say the average market value is two million rand, but you believe your property is now worth three million rand due to renovations. However, it’s essential to be cautious. You may have over-capitalized on the property, spending more than its actual worth. Ensure you set a reasonable price based on market value to maximize your chances of a successful sale.

The second report that you draw on www.lightstoneproperty.co.za is an area or suburb report. Here you enter the area/suburb name. This will give you an idea of how many properties have sold in the suburb in the past twelve months, the type of properties (freestanding or sectional title), what each property sold for, who the age group buyers are, and lots more information. Based on this, you can determine your price. If you haven’t received any inquiries after two weeks of listing your property, it might mean that the price is too high. Time to reconsider and adjust it a bit.

Don’t make your property stale.

A stale property is a listing that sits on the market for a long time without any interest from potential buyers. Many sellers say they want to test the market. This is the worst mistake that any seller can make. Never test the market by listing for way more than what the property is worth. I guarantee you; the property won’t sell. Always go to market at a market-related price.

In today’s buyer-savvy market, informed research norm al before making a purchase. Buyers are well-versed in property values, making them unlikely to consider buying an overpriced property. If your listing fails to attract buyer interest within the first two weeks, it’s a clear sign of a potentially high price. Take immediate action, and lower the price, rather than relying on luck. Not doing so will result in a stale listing, causing buyers to dismiss it. Delaying a price drop by a month or two may be too late since the same pool of buyers frequently browses property portals. When potential buyers see your listing, they take note of the price. However, if they have found another property or lost interest, they may not inquire further. This may be perceived as desperation, giving buyers leverage to negotiate even further. Act promptly to maintain market appeal and competitiveness.

More Tips on how to sell your home privately

Decide whether you want to sell your property as is, or whether you want to make small fixes to the property.

Never spend too much money on cosmetic changes to the property when you sell. Buyers will change everything the way they like it in any case. For instance, don’t spend money on painting everything white. That’s going to set you back a few thousand rands, and when the new owners move in, they’ll paint their preferred colors.

To get things back on track, just fix whatever’s broken. It’s as simple as that! These are things like a leaking tap, a toilet that doesn’t flush properly, a broken toilet seat, a cupboard door that is coming off its hinge, a cracked window, old putty-in window frames, and silicone around the kitchen and bathroom basins. You get the picture. People generally don’t want to buy something that’s broken. If they end up buying something that’s not working properly, they usually want a big discount. Don’t give potential buyers too much bargaining power.

Creating a defects list

Now that you’ve determined the price and you got the property market ready; the third step is to make a list of all the defects to the property. It is the seller’s legal responsibility to be honest and not hide any defects to the property to the best of his knowledge. When you’re honest with buyers, they’ll appreciate it and trust you. So go ahead and set the tone for a trusting relationship! We all like to do business with people that we trust. Feel free to share this information with anyone who’s interested in buying. You also need to attach this defects list to the offer to purchase.

Tips on how to sell your home privately

On that note, let’s talk about the offer to purchase.

When you sell your property through a real estate agent, that real estate agency would have a legally sound, and most up-to-date offer to purchase documents for the buyer. However, when you sell privately, you should not just go and download an offer to purchase off the internet. You have no idea how old that document is, when it has been updated, or whether it is up to date with the latest property law clauses in South Africa.

In my experience of selling privately the best is to approach a transferring attorney. Let them know that you are selling your property privately. Ask for an up-to-date, legally correct, offer to purchase document. In return, you can offer the attorney the following: Once you accept an offer on the property from a prospective buyer, you will take the business to their law firm to attend to the conveyancing. Conveyancing attorneys are always looking for new business opportunities and will most likely go for such an offer. After all, even though the buyer pays the conveyancing fees, the seller may appoint the conveyancer.  

Marketing the property when you’re selling privately.

You are now ready to start marketing the property. Remember as a private seller, you don’t have all the resources like a database of buyers and a marketing budget. You’ve got to be creative.

Take publicity photos.

Start by taking pictures of the property inside and out. Pictures with a quality camera on a smartphone will do. Make sure the house is clean, neat, and light (you want to avoid the three Ds when you take publicity photos – Dirty, Dark, and Dingy).

Make sure there is no clutter, for instance, remove toiletries from the bathroom, and extra appliances in the kitchen, clear the family portrait wall and make sure the garden is in good condition. Take wide shots (get the whole room in. Don’t just shoot the bed or the toilet. Your buyers want to get an idea of the space), and don’t shoot down. Take the photos from an eye-level angle (Bend your knees when you take the photos if you need

 

Writing the copy for the advertisement


Now that you have the photos, you can write a short paragraph describing what is on offer. Don’t oversell. Just be clear about what there is so that you don’t create unrealistic expectations. Make sure to avoid disappointing the buyers when they come to see the property.

Start with essentials like how many bedrooms and how many bathrooms. If any of the bathrooms are en-suite, also make mention of it. Now go to the nice-to-haves like the big kitchen with a pantry and Caesarstone tops, huge entertainment area, and under-roof parking for four cars. Now you go to the necessities that may set you apart from other sellers, like solar panels, electric fences, garden flats, etc.


Go to the property portals like www.property24.com and www.privateproperty.co.za. Look at what other listings say. Consider the listings that excite you and look interesting. Don’t copy what those listings are saying but draw inspiration.

Listing the property


Now that you’ve finished taking your photos and writing your ad, it’s time to start listing your item. Start with free classified listings like Gumtree and the like. Also, post on Facebook groups. Before you advertise your properties in any of these groups, make sure to check with the admins first if it’s allowed. It’s always better to ask first to avoid any trouble. I know in bigger cities like Johannesburg there are Facebook groups that are specifically for advertising properties. Just go to Facebook and put in the search tab “properties for sale” and see what is available.


List the property in as many classifieds as possible. You never know who is looking to buy what you have to offer.

I sold a property privately not too long ago. I did everything that I just talked about, plus I also placed a small advertisement in the newspaper with no photos (remember it costs money to advertise in the newspaper, so I didn’t want to spend too much money). The day the specific newspaper publication came out I received a call from a potential buyer in another city who was looking for a home for his student son who was planning on studying in Johannesburg. The potential buyer came to look at the property and he made a cash offer of only R10 000 less than my asking price. So, you never know. You just have to be creative in your advertising.

Most home buyers frequent the two most popular property portals in South Africa, namely www.property24.com and www.privateproperty.co.za. You may also want to list your property on these portals. There may be discounts for private sellers. So, check them out.

Tips on how to sell your home privately

Viewing the property with potential buyers


Tips to consider when letting potential buyers view this property:

Normally a real estate agent would manage the viewings with potential buyers, but when you sell privately you will be doing this very important part of marketing and selling yourself.

When potential buyers start responding to your advertisement make the appointments for viewing and ensure that the property is always in the same good condition as in your photographs. When they arrive at the property, don’t oversell. It never works. They can see when you’re desperate and let’s face it, desperation is not sexy at all.


Tips to consider when letting potential buyers view this property

Rather allow the potential buyers to take a tour through the property while you’re waiting outside. Don’t ever let the buyer feel uncomfortable or pressurized during the viewing. This will only lead to them wanting to get out of there as quickly as possible. The viewing is so important. This is when a potential buyer figures out whether the property “speaks to them or not”.


Once the viewers have seen the property, you should answer any questions they may have in a concise manner. Avoid overselling or concealing any details. Some individuals have a tendency to oversell and talk excessively. If you are one of them, there is an alternative approach. Instead of emphasizing how remarkable the property is, share your personal stories and fond memories associated with it. For instance, you can talk about how you raised your children in this house or completed your master’s degree in the study while juggling work and raising kids. You can also share how you taught your children to drive in the driveway or had memorable holiday celebrations with your family and friends in the house. Such stories can add a personal touch and help the viewers relate to the property on a more emotional level. Remember to keep the stories relevant and brief.


The idea is to never let the buyer feel as if you are trying to get rid of the property and now, he is a soft target, but rather to let him understand that you have created fond memories in that home, but you are now moving on to a new chapter in your life. It is now his (the buyer’s) opportunity to create his own memories in the home.

Tips on how to sell your home privately

Price negotiation and taking an offer on your property.

Tips for price negotiation and taking an offer on your property:

Again, if you were selling your property through a real estate agent, this person would be negotiating on your behalf. They would also hopefully be good at negotiation because it is something they do on a daily basis. f you decide to sell your property privately, just remember that you’ll be the one in charge of negotiating with potential buyers. It can be a bit intimidating, but you’ve got this!

As I mentioned right at the beginning of this article, remove all emotions. You have got to remain calm at all times. The minute you lose your calmness you give away your power. Many buyers will try and make cheeky offerings. When this happens, don’t take offense. Rather ask the buyer calmly how he has arrived at this price. In most instances, the buyer will not be able to answer this question. Or if they have a valid point, it might get you thinking. Take any criticism from any buyer as ammunition to improve on the viewing with the next buyer.
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Tips for price negotiation and taking an offer on your property:
When you price your property correctly, you can feel good about showing the reports you downloaded from www.lightstoneproperty.co.za to potential buyers. They’ll appreciate your transparency and be more confident in their decision-making. This will also demonstrate to the buyer that you have done your homework and that he will not be able to get away with any cheeky offers.

Always be sure that your sales contract (offer to purchase) has a “Continue marketing” clause. This is particularly important. It means that even after you have taken an offer on the property, and while your buyer is in the process of meeting his suspensive conditions, like getting finance or selling his property, you can continue marketing the property. Should you get an offer that is of better quality, you can notify the first buyer that you have another offer and that he now has seventy-two hours to meet his suspensive conditions, otherwise his offer will lapse. Seventy-two hours is the legal time frame that you can give the first buyer to meet his suspensive conditions. Make sure to state it in the agreement too!


Before the buyer signs the offer to purchase ask him whether he understands the terms of the contract and if not, he should consult an attorney who can explain all the terms and conditions to him. You can even recommend your own conveyancing attorney. Your contract should also state that the buyer agrees that he understood the contents of the agreement before he signed it. A buyer might use the fact that he did not understand what he was signing, as a loophole to get out of a contract. You want to cover all your bases.


Conclusion


Once you have a signed offer, you can counter-sign. You are now ready to submit the signed offer to the conveyancing attorney, who will advise further on the matter. You’ve successfully sold a property, as long as all the buyer’s suspensive conditions have been met, of course. Congratulations!


As you can see, selling a property privately is not a walk in the park. You will have to know what you are doing. If you don’t feel confident to take on such a huge responsibility, I would like to suggest that you hand the marketing and sale of your property over to a real estate agent and make peace with paying the agent’s commission. It is a small price to pay for peace of mind.


All the best with the sale of your property.

(Last updated: 4 February 2023)

 

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