Pitfalls await the do-it-yourself home seller

A certain type of home seller will often be tempted to do it alone and sell his home without the help of an estate agent.

This, however, says Rowan Alexander, sales manager at the Rawson Property Group’s Brackenfell franchise, all too often leads to very serious problems.

Recently, Alexander, has come across two cases which illustrate clearly how the average home seller involved in a property transaction can be seriously unaware of its implications about reading the contract conditions. In both these cases, said Alexander, problems were caused for the seller and buyer.

In the first case the seller signed a document accepting an offer from a buyer conditional on the buyer being granted a bond – which was then given to him. The seller then changed his mind and decided that he did not want to sell, completely ignoring the very obvious fact that in law he had agreed to do so.

Actions of this kind, said Alexander, are often based on a lack of familiarity with property law, but whatever the cause they can lead to big financial losses. In this case the buyer could have claimed compensation for the trouble and inconvenience he had been put through. If, for example, he had sold his own home in anticipation of moving or had been forced to rent premises, the claim he could have put through would have been enormous.

Even if he had sold his car because it would not fit into the new home’s garage, it would have entitled him to claim compensation for the extra cost of buying a new car.

In another case, a buyer bought a property in which a tenant still had an extended lease entitling him to live there for a further nine months. Unaware of the legal principle, huur gaat voor koop, he then tried to evict the tenant, which was simply impossible due to the weakness of his legal position.

These and other cases, said Alexander, show that going ahead with a property transaction without employing an experienced agent can very easily lead to disaster.

“Well trained estate agents,” he said, “know where to look for the hazards and pitfalls in any property transaction and they are taught to point these out to their clients.

“They are, in short, trained to make a difficult job simple and hassle-free.

“Quite frankly,” said Alexander, “the average seller simply does not know how to go about selling his home. One of the big advantages of employing an estate agent from a company where the estate agents are thoroughly trained is that they are likely to be capable of valuing the home accurately – something the DIY operators seldom get right. Such DIY operators,” said Alexander, “often price too low and miss out on profit that is rightly theirs. Alternatively they overprice, which almost always leads to the home sticking on the market for a longer period of time. This, in turn, eventually leads to the property selling below its true market value.”

“Today’s buyers,” said Alexander, “are shrewd: they have learnt how to use technology available to them and by calling up a few websites they can get a very accurate idea of the pricing of similar properties in the area they favour.”

In his experience, added Alexander, estate agents are always far more competent negotiators than the DIY operator and by using facts at their disposal they will achieve a very satisfactory price. Furthermore, he said, they have the added benefit if they are part of a big national group of being able to go big on advertising and being able to expose the property to a host of other franchises who may well have buyers looking for such a home and is keen to earn a referral fee.

“If the franchise is part of a national group which is well branded with high visibility in the area being investigated, that in itself is likely to lead to a quicker, more affordable sale,” said Alexander. “The best advice I can possibly give any person contemplating selling their home is to use the dominant agency in their area.”

Asked how he responds to some of those contemplating a DIY operation quoting unfortunate experiences with estate agents in the past, Alexander said it has to be appreciated that the entire property market industry has in the last decade become a great deal more professional. This is a result of the Estate Agency Affairs Board making fairly stiff educational qualifications (NQF4 and NQF5 in particular), the writing of examinations and one year internships for new beginners completely mandatory.

“You simply cannot overestimate the effect that this has had on the industry,” said Alexander.

“It has reduced the number of estate agents employed by over two-thirds and has given a career in property marketing and selling a new appeal, which in turn has attracted more capable people, many of them young and holding other qualifications.”