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Expired Listing: Can I Sell My House?
Recent data suggests that 40% of real estate listings usually reach expiration without any leads on a potential buyer. If you're part of this statistic and wondering how to proceed in selling your property, we've got the answers right here.
You can still sell your house after a listing expires. However, if you don't plan to sell with your previous listing agent, you must wait for at least 90 days. This is because most agreements have a listing protection period that requires sellers to pay the previous broker a commission for a successful home sale. In most cases, you should also wait for this listing protection period to expire if you plan to sell to a cash buyer.
Selling after a listing expires may seem complicated, but it actually isn't. We have detailed everything you need to know about expired listings in this blog so you can get started selling your house again!
Common Types of Listing Agreements
A real estate agreement or listing contract legally binds you as the seller to the real estate company or agent that would help you with the home sale.
According to The National Association of Realtors, there are three major types of listing agreements.
In this type of agreement, any real estate agent can work to sell your house. In other words, whoever finds a buyer gets the commission. This agreement also allows you to find a buyer on your own.
Exclusive Rights-to-Sell Listing
This is the most common type of listing agreement with a new agent. In this option, you grant a real estate agent to market and list your home in a multiple listing service exclusively. You won't be working with any other real estate agents and you cannot also sell your house on your own.
Exclusive Agency Listing
Similar to Exclusive Rights to Sell Listing, this also binds you to a single real estate agent or brokerage. However, you may also work independently to find a buyer.
Many real estate companies do not offer or agree with Exclusive Agency Listing and Open Listing since all their efforts would be in vain if you find a buyer while marketing FSBO.
Terms of a Listing Agreement
Here are some of the terms commonly stated in a real estate agreement:
- How much commission you'll pay your real estate agent
- The agent's right to sell depends on the type of listing agreement you agreed upon with the company
- What will happen when the real estate agreement expires
- The duties and activities that the real estate agent can do on your behalf
- The details of dispute resolution
- Representations that detail whether you have the right to sell the property
- The safety clause for agent protection (listing protection period)
Length of a Real Estate Listing Agreement
The length of a real estate listing agreement would depend on the decision of the agent and the seller. However, most agents have standard contracts, which usually span from four to six months.
Of course, the seller may request for a shorter or longer time period that should be agreed upon by both parties. But once the listing contract is already signed, the length of the real estate agreement can no longer be changed unless the seller is willing to pay for costly repercussions.
Reasons Why a Real Estate Listing Expires
Listing agreements that expire may have been rare during Covid-19. But with interest rates rising, expired listings will become more common. When this happens, the real estate agent is no longer legally obligated to sell your home.
Before you proceed to list your house again or sell to a cash buyer, you must understand some of the major reasons why you didn't have a successful home sale the first time.
Note: Expired listings are different from withdrawn listings. Withdrawn listings are when a seller decides they no longer want to sell their home.
Unreasonable Listing Price
Real estate agents who are experienced in selling homes know that setting the right price can make all the difference in a home sale.
However, if you are working with a new agent who isn't well versed in comparative market analysis or isn't updated in market fluctuations, they may list your house above market value which could drive interested buyers away.
It's also possible that you disregarded the pricing suggestion of your real estate agent and forced him to list above market value.
Poor Photography and Staging
Many potential buyers use online tools to find properties they can purchase. If your real estate agent used blurry phone camera photos for the listing, expect that your home won't get much attention.
This is also the case if you did not stage your house well. All the ugly parts of the property will easily reflect in the photos, no matter how you try to hide them.
Poor Communication Between the Seller and the Real Estate Agent
If you lack communication with your real estate agent, you will miss some inputs on your listing that are crucial for selling the home.
For instance, if there is buyer feedback regarding the type of countertops, the real estate agent should correct the listing description right away to boost your listing.
Some real estate agents also do not disclose buyer offers right away in the hopes of finding higher offers. This never-ending "waiting" may, later on, lead to an expired listing.
Poor communication is also one of the main reasons for withdrawn listings.
Factors Beyond Control in Real Estate
Sometimes, no matter how great your real estate agent is, some factors beyond your control can affect the home sale. Here are some of them:
- Property is far from restaurants or malls
- There is no parking space
- There is no natural light
- The property is situated in a flood zone
- Someone died on the premises
- The neighbor or the whole neighborhood is noisy
- The house is located in a busy area
How Long After a Real Estate Contract Expires Can an Owner Sell Privately?
Usually, an owner can sell a house privately or with a new agent 90 days after the real estate listing contract expires. This is to avoid paying the previous agent a commission.
Real estate listing agreements usually include a safety clause protecting the agent from the seller. To be specific, should the buyer decide to end the listing contract or sell immediately after the listing expires, he would owe the previous agent a commission fee for a "tail period" stated in the safety clause.
It is possible that the real estate agent's efforts resulted in the sale outside the listing period. If you used their marketing strategy, they should be compensated (whether it be after a withdrawn listing or an expired listing).
Generally, most listing protection agreements included in the safety clause covers 90 days. But some brokers and agents have shorter tails.
Options When a Real Estate Agreement Expires
You can sell your house even if the real estate listing agreement expires. There are three main routes you can take...
Sell Property to a Cash Buyer
Starting the home sale process all over again and reviewing a new listing agreement can really be tiring and frustrating. Luckily, you have the option to sell your home to a cash buyer.
The best thing about cash buyers is that they can wait for the tail period to end, unlike many retail buyers who want to move into new houses fast. Moreover, if your previous listing expired due to major property damages, there is still hope to sell when you get a cash offer since cash buyers purchase houses as is.
You won't have to cover closing costs or commission, so you may net more money after the sale.
The process of selling your home to a cash buyer is pretty straightforward. You ask for a cash offer by filling out a form on the cash buyer's website or by calling them. They may then conduct a property visit to formulate a more accurate offer.
Once they've given you a cash offer and you accept it, they'll send you a contract via email. Of course, you have to review and sign the contract so you can proceed to close the sale. After the closing, you'll receive your money in your bank account and your property will be legally owned by the cash buyer.
Sign With a New Real Estate Agent
If you have the energy and patience to restart the home selling process again, you have the liberty to do so. However, it may not be wise to sell your home with the help of your current agent if you do not feel confident about how they handled your listing.
Here are some specific signs that you should find other agents:
- Your real estate agent wasn't proactive before.
- They didn't communicate clearly with you.
- They didn't give you any advice on improving the curb appeal of your home.
- They didn't tell you the importance of professional photography in a listing.
- They failed to handle the pressure of selling a house.
- They didn't have your best interests in mind.
- They did some unethical acts.
- They did not meet expectations during negotiations.
Sign a new agreement with a real estate agent that has proven experience in selling houses in your area. Make sure to do background research and search for client reviews before agreeing to a new listing agreement.
You may be bombarded by phone calls from other agents when your listing expires, so you should be cautious about who to trust when you sell your home again.
Extend the Real Estate Listing Agreement or Draft a New One
It is also possible that the home listing failed despite the listing agent's best efforts due to factors beyond the control of anyone. Thus, to avoid being back to square one when a listing agreement expires, it is wise to extend or renew your old listing agreement with your agent.
During renewal, revisit the asking price you set, the marketing plan, and the staging you've done with your agent to see what can be improved.
Don't rush into the new real estate agreement without reflecting on what went wrong in the previous one. Remember that to sell homes fast, preparations are crucial.
Final Thoughts: How Long After An Expired Listing Can I Sell My House?
You must pack enough patience if you plan to sell your house after a listing expires. Many listing agreements come with a protection clause or a protected time frame that requires home sellers to pay their previous real estate agent with a commission fee.
If you want more certainty in your home sale and are already tired of waiting for retail buyers to take an interest in your property, get a cash offer!
Here at Sell My House Fast, we have enough time to wait for the tail period to end! We also won't ask you for any closing fees and other charges, so you get our full offer right into your bank account.
Once you're ready to sell your house after its listing expires, fill out our form below or contact us at (844) 207-0788!