Wednesday, September 30, 2009

How are "private real estate deals" done and are they good for you?


This blog is based on a question that one of my friends in Kemp Mill, a subdivision in Silver Spring, Maryland posed to our neighborhood list serve.


In my neighborhood and other neighbor there are real estate transactions that take place where in certain cases (1)there isn't a for sale sign in the yard;(2)internet advertising;(3)any appearance of a home owner trying to sell his home/have his/her home listed with a real estate agent,but then we hear that the home just sold. Is this good for buyers? Is this good for sellers? Are real estate agents ever involved in these transactions? Do they agents offer 'a-la-carte services' when they are involved in these real estate transactions?


Below is an answer which I sent directly to the person who posed the question. A few other people in my neighborhood asked if I saw the question and what I thought. So, I thought his question to be topical and definately "blogworthy".


...As far as homes that "never" go on the market in certain areas,where home owners/home sellers are relying on their closest network to tell people of a "home that may be for sale". There are also cases were people have told their realtors something along the lines of if somebody you are working with likes my type of home and is in 'X' price range,show them my home and I'll give you 'Y' as a commission for bring the buyer.Another situation that occurs is that listing agents make calls after signing an agreement with home owners to put their home on the market in hopes of getting both sides of the deal. So,sometimes they first show buyers they are actively working with or call people they hear are looking and try to put a deal together before a sign ever gets in the yard.Some of these deals are for sale by owners without agents and some are with agents as I described above. As far as full service,you would have to ask the owners their opinion and what their goal is. If an owner's goal is to be discrete,doesn't want their home to be sold and not be too bothered with many people going through their home,then their goal may be achieved,although it seems like many people in Kemp Mill have their antenas up. Some sellers want to move a.s.a.p. for whatever reason and think a private deal can also be executed quicker. Certainly an agent may be motivated to sell before a sign goes in the yard to get both sides of the deal for certain,which would result in him/her getting a higher commission than one side of the deal. Some sellers like the approach of having the house very publicly open thinking they may get multiple offers based on more exposure and maybe sell for higher than public deals.What begs the question is if the home buyer is paying a premium for buying the home before "it goes out there on the market",where the agent says you have an exclusive at such and such a price or if there would be more demand/more offer,offers at higher prices if the home was very publicly marketed to everybody. Quite a bit of the time homes do sell less than if they were on the market (where the seller probably would have netted more money even after paying a full service real estate agent).In pure for sale by owners,the buyer/seller may still hire a real estate agent as a consultant for a flat fee for putting the contract together,overseeing the financing and appraisal process,over seeing and working through inspections,walk through, etc.That's more than my 2 cents worth.



301-943-4370Adam Bashein

Licensed in MD & DC

Weichert Realtors

7821 Tuckerman Lane

Potomac,MD 20854

301-718-4100 ext. 132


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(question my blog is in response to)
Buying Real Estate in Kemp Mill - Please ExplainOne unique aspect of buying real estate in Kemp Mill is the number of housesfor sale that never go "on the market" (i.e., are not officially listed oreven advertised for sale).


Someone please explain this approach to me.Is it that these houses are for-sale-by-owner? My impression is that this isnot quite the case, because there is often an a real estate agent involved.So that point leads to me another possible scenario: is the agent being hired to do a-la-carte services for the sellers instead of a full servicerepresentation of the seller (that would not include a MLS listing)? Even then, it does not make full sense to me because I would think that a sellerwould want to maximize the selling price by advertising the sale to thewidest possible set of buyers interested in living in the Kemp Mill area.


301-943-4370
Adam Bashein
Licensed in MD & DC
Weichert Realtors
7821 Tuckerman LanePotomac,MD 20854
301-718-4100 ext. 132

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