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private sale (Featured in biz-x magazine)

Instead of relying on realtors, more and more people are taking matters into their own hands when it comes to selling their homes. Would you?

by Christina Friedrichsen

Three weeks. That’s all it took for Frank Spidalieri to sell his $385,000 home in Tecumseh. And he did it without a realtor.
“It was my first private sale on a home and I would never go real estate ever again. I got exactly what I wanted,” he says.
Spidalieri is just one out of hundreds of individuals that have enlisted the services of The Private Exchange, a local marketing company, to sell their homes.
Instead of spending 6 percent commission on a realtor, he spent $549 – the fee for The Private Exchange’s basic package.
Before going with The Private Exchange, Spidalieri says he went the realtor route. In fact, his home was listed with an agent for six months.
“I had maybe five to eight couples come through … There wasn’t one open house,” says Spidalieri.
After becoming frustrated with the lack of interest, Spidalieri decided it was time to take matters into his own hands. He had heard about The Private Exchange through friends, and had also noticed numerous company signs on lawns around the city.
Immediately after signing up, the calls began.
“In one week we got 30 calls. In two weeks we had 10 couples come in. The third week, the 11th  couple came through, and that same couple came back the next day and made an offer,” says Spidalieri, adding that the majority of couples found the home on The Private Exchange website.
Despite owning three businesses and having a hectic schedule, Spidalieri says he still found the time to sell his own house, and that the process was “easy.”
“It was nice because I went through the home with (the couples.) I’m the one that built the home and I know the home better than anybody,” he says. 

Business booming

Kim Zdunich, owner of The Private Exchange, says business is booming.
She says when she started the company four years ago, The Private Exchange listings newspaper was four pages. Now it’s 40.
“We have over 300 houses in there now. Windsor’s just taken off like crazy,” she says, adding that the company also has an office in London.
Last year a total of 480 homes were sold though the company – up from 340 the year before, and 210 in 2001.
Zdunich says 75 percent of business is based on referrals.
“Every time someone sells, they tell their friends and neighbours.”
She also adds that once a client sells privately, they are likely to sell future homes that way.
“I have at least 10 clients off the top of my head that have bought and sold at least two homes through us just in the last four years,” she says.
According to Zdunich, there’s no better person to sell a home than the homeowner, because s/he knows it better than any realtor would.
“I’ve been through many homes where I have asked the agent a question about the home and they’ve had no clue,” she says. “The homeowner has instant answers.”

How does The Private Exchange work?

Clients have the option of two packages. The basic $549 ‘Gold Til Sold’ package includes advertisement in the company newspaper and website. The ‘Maximum Exposure Gold Plus’ package, which sells for $929 includes five Windsor Star colour ads, along with a week on cable TV.
Potential clients can attend a monthly information seminar at the Caboto Club to get information about the company.
Zdunich stresses that although a home consultant will visit your home to gather information about its features, a home appraisal is not part of the package. The company does recommend to clients, however, that they don’t stray too far from their ‘bottom line.’
“Homeowners usually price their homes 3 to 4 percent above the bottom line, and that’s what we recommend,” she says.
She says the company’s success rate is 65 percent.
“Out of 100 people that list with us, 65 sell,” she says, adding that the average time on the market is 45-60 days.
According to Zdunich, it’s a myth that homes listed with The Private Exchange sell for less simply because there is no commission involved. 
“Let’s say we take a subdivision and we have five houses in there priced through The Private Exchange, and five through a realtor… We’ve seen what they’ve sold for and they don’t sell for any less,” she says. “(Potential buyers) might in the back of their head think that because there’s no realtor involved they might be able to get it for less, but market value is market value.”

Times are a changin’

Zdunich says the Internet has made it easier for people selling their homes privately to get exposure.
“People are finding there is not as much need for a realtor. Before, they didn’t have the knowledge. The Internet makes the home very accessible. The exposure that private sellers are getting now is 10 times what it used to be,” she says.
As a result the role of the realtor is changing.
“Their job description is really changing,” she says, adding that along with real estate marketing companies, pay-per-service real estate is becoming increasingly popular – especially in metropolitan areas such as Toronto.
In pay-per-service real estate, clients can purchase realtor services a la carte, instead of paying commission to a full-service realtor. If a client wants to hold their own open houses, for instance, they can save money that way. Clients can also choose from a variety of advertising options, which can reduce their cost.
Zdunich points out that there are even companies that will list your house on the MLS (Multiple Listing Service) for a fee.

Eager to sell

Peartree is another home marketing consulting company in the Windsor area, but owner Dave Lachance says the company is much different than The Private Exchange.
“Essentially we professionally guide our clients through the selling process from start to finish,” he says.
He explains that the only difference between the service that Peartree provides, and that of a realtor is that with Peartree the homeowner shows the property.  
Clients that sign up with the home marketing company have a variety of services to choose from. Although Lachance would not disclose what the fees are, he said they are less than what a homeowner would pay a realtor.  
“We can’t understand why agents charge commission other than people are willing to pay it … Our success rate is about twice that of real estate … People use us because they want to sell their home, as opposed to save the commission – that’s really just a bonus,” he says, pointing out that 63 percent of homes listed with Peartree sell within 61 days.
The reason they generally sell quicker than homes listed with an agent, he says, is that they are given greater exposure.
“(A homeowner) can do open houses every week. They can also advertise seven days a week and put it on TV seven days a week,” says Lachance.

What realtors think

Goran Todorovic, an associate broker with Re/Max Preferred, argues that the success rates are much higher with realtors, than through private sales.
“Statistics have shown that using a realtor will get you more money in your pocket (and) a quicker sale with fewer problems,” he says.
He adds that unlike home marketing companies, listing with a realtor doesn’t cost the vendor anything upfront.
According to Todorovic, even if a house is listed privately, more often than not real estate agents end up getting involved. He says oftentimes a realtor will find a buyer for a private sale home, and as a result receive commission.
“I’ve seen full commissions, I’ve seen partial commissions,” he says.
Michelle Wobst, a sales representative with Coldwell Banker Crampsie Realty, also argues that when it comes to selling privately, most people aren’t as lucky as Spidalieri.
“I’ve seen so many people that have tried to sell privately that have gone to a real estate agent because they can’t get it done, or they are so stressed out,” she says. “Who has time, when you have a nine or ten hour day to come home and deal with phone calls, and trying to set up a showing on top of cleaning and everything else? Who has time for that?”
Aside from the fact that it’s more time consuming to sell your own home, Wobst says there are numerous other disadvantages. She says selling a home requires knowledge that the average person may not have; like, for instance, knowing what your home is worth.
“It’s very hard to sell your own house. I’ve done it, and I’m a professional, and it’s still not easy. Your house is your kingdom, and you always think its worth more than maybe what it is.,” she says. “The majority of (private) listings we see are extremely overpriced. Even when a realtor tells them this is how much your home is worth, they don’t necessarily believe it.”
And once the home is listed, the real work begins. There are phone calls. Open houses. Then there is the negotiation process.
“It’s hard in the negotiations to not have someone negotiating for you. To have somebody advising you,” she says.
She points out that during the negotiation process there’s always the chance that your emotions will get the better of you. Say, for instance, you simply don’t like the people that want to buy your house. Wobst says that’s the reason realtors discourage personal contact between vendors and purchasers.
“We don’t allow (them) to meet and discuss things. That’s something we don’t like to happen because sometimes a personality conflict can kill a deal. People will say ‘ You know what? I don’t what to sell my house to that person’,” explains Wobst.
Deborah Moore, an associate broker with Prudential Select Realty, says there are also a slew of liability issues when you are selling privately.
She says all realtors in Ontario carry mandatory ‘errors and omissions insurance’. If you are selling privately, you are not insured if there was a mistake made in drafting up the offer, like an inconsistency in a term in the offer – or a simple mistake in the information sheet.
“If the buyer relies on that information and it turns out to be incorrect, it may cause a litigious issue where someone has to sue,” says Moore.


Moore acknowledges the increasing popularity of selling privately, and says it’s simply part of our increasingly ‘do-it-yourself’ culture.
“People are becoming more and more sophisticated at doing multiple things,” says Moore. “I think anybody that can do anything for themselves - more power to them, that’s great … Just as someone who is lucky enough to know how to change the oil in their car and wishes to do that that’s great. Myself, I don’t know the first thing about cars. I don’t like to get dirty. I don’t like to climb under my car, so I like to hire a professional to do that. And many people feel the same about the real estate industry.”
Moore believes there will always be a need for realtors, but points out that to stay competitive, the role of realtors is evolving. In fact, the company she works for, Prudential Select Realty, is considering implementing pay-per-service real estate, where clients will have the option of choosing from various services, a la carte, as well as the full service.
“We have historically focused on the full service, but I think there has to be some recognition in the industry that there are a large percentage of people that want some of the services, but maybe not all,” says Moore. “We’re very close to implementing that.”