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First-time seller: How clever is it really to sell my home privately?

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We received a question from a first-time seller feeling anxious over the decision to attempt selling her home privately.


“What is the process, especially if no bond is owed? Is it even wise to sell privately or should I rather use an agent? Does a purchaser with an approved bond make the transaction any easier?”

Wimpie Potgieter, property asset management head at FNB, believes that the decision to sell privately or via an estate agent is a personal choice. “It depends on the time available to host potential buyers. Generally property transactions are rather straightforward,” he adds, saying that the fact that the seller in question already seems to have a buyer with an approved bond should make things easier. “Selling privately here will save a substantial amount in commissions.”

Trevor Gaw, well-known motivational speaker and widely considered the “real estate doctor”, cautions, however, that certain risks are still involved, especially when it comes to how buyers buying privately perceive the transaction.

“Private buyers automatically expect a reduced price to compensate for the absence of real estate fees,” explains Gaw. “This usually results in the seller selling below what he should get, especially today with most buyers being highly knowledgeable about real estate factors such as location and average price.”

In fact, says Gaw, pricing is probably the biggest and most critical factor to consider when it comes to attempting to sell your home privately. Often properties stay on the market for far too long since private sellers are often guilty of misjudging their property’s value and then over- or underpricing the property. “If you price a property to sell, it sells. If you price it to list, it remains listed for a very long time, but does not sell,” he explains.

How every extra week on the market loses you money

Getting personal

The key to long-term, successful business negotiations remains relationships.

Another thing to consider is the human interaction and relationship-building that will be needed when selling your home privately. It’s easy to forget, but behind the scenes the agent does a lot of following up, meeting and calling potential buyers for your home. If you are selling without an agent you will need to do all this yourself.

“Private sellers often find it difficult and uncomfortable following up with buyers and can be perceived as desperate to sell,” adds Gaw. “This is a service that property professionals can provide well.”

As Greg Nathan from Showday Properties puts it: “A seller takes full control of the sale risk which may be considered lower risk and higher return, but it is not an easy model to succeed at with low risk, high return.”

Often times sellers misjudge their own knowledge, ability and even time (believe us, this takes time) to spend on marketing and selling their properties successfully. If this is something you are considering, you need to go into it with eyes wide open.

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If you’ve weighed up all of these options, looked at the avenues available to you in either case and decide that you are up for  the private sale then, says Potgieter, there are lots of tools at your disposal.

3 things to remember when selling privately

  1. Advertise your property. There are several property portals and services available for this purpose.
  2. Make time available to set up appointments with prospective home buyers. On the nav» Home web page there is detail on how to prepare for a show day. Security needs to be a key consideration here. We suggest that customers try and validate the buyers by determining who they say they are by referencing social media etc. Also a pre-approved buyer is also potentially a better option as you know that the person is serious about the purchase.
  3. Once you have a buyer, the next step will be to negotiate the offer to purchase. This is a rather standard document to complete and is freely available. A home loans consultant can assist with completing the form. This agreement has to be in writing and cannot be concluded verbally.

What can go wrong buying from a private seller?

7 points to remember when negotiating the offer to purchase

  1. The seller has the right to appoint the transferring attorney, at the buyer’s cost. It is important that you select a reputable attorney that specialises in conveyance. Your banker or a home loans consultant will be able to assist you with firms.
  2. Ensure that all defects are disclosed; the buyer can hold you liable for latent defects, such as damp issues that have been painted over to hide from the buyer.
  3. Ensure the purchase price is on the contract.
  4. If the purchaser is selling an existing property before this agreement comes into effect record that clearly and set a clear timeline.
  5. Agree on when occupation will take place, or agree on occupational rent if applicable.
  6. Record all items such as alarm, garage motors and fence and in what state they will be transferred to the new owner; thus what is included and excluded from the transaction. If you could take your home and turn it upside down, everything that falls is normally considered movable and excluded. An alternative view is that if you need a tool to remove it, it is fixed and thus included. Items such as blinds will thus be fixtures.

  7. If you sign subject to sale of a property, ensure that you have an addendum to ensure if you get a stronger offer the purchaser has, say, 72 hours to match. The stronger sale will take preference in this instance. Indicate on the agreement that finance is to be obtained by a certain date. The agreement will only come into effect once finance is in place and the required deposit (if applicable) is paid into the attorney’s trust account.

Once the agreement is signed and the purchaser has obtained a bond, the bank will send an instruction to the attorney to affect transfer and to register a bond. The attorney will then contact your buyer and yourself to sign documents. There may be a deposit requirement at the attorneys to cover rates and taxes and usage for a couple of months to ensure they get clearances from the municipality.

Private selling accounts for around 10% of sales concluded in South Africa each year due to a range of factors, including many sellers not knowing where to start or preferring not to deal with a host of potential buyers who may or may not be serious – or who may not qualify for finance. Remember, when the offer to purchase is signed, your home is effectively “off the market” until the bond is approved or denied. As a private seller, this is a very real risk that you need to be prepared to deal with.


Mariette Steynberg is a qualified economist with a post-graduate diploma in financial planning. She has enjoyed working on holistic financial plans for clients in various stages of life, as well as a development economist assessing the socioeconomic impacts of new developments. When she is not working, Mariette enjoys parenting her quirky, delightful toddler girl. Cloth diapering, Eskimo kisses and the importance of reading to your child are all causes close to her heart. Mariette is passionate about financial education and hopes to use the experience she has gained to share knowledge with HomeTimes’ readership. Her goal is to provide information that is implementable by everyone.

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