Selling a home can involve many costs, which moves some people to sell without an agent, also called as “For Sale By Owner”(FSBO). In terms of money saved, this might look simple enough, but the opposite can actually happen if you’re not careful enough. Here are a few reasons why you should not sell your home on your own or without the help of a real estate agent.
The first and most important reason why you should avoid doing FSBO is a lack of experience. A recent post from Lifehack explains why inexperience could cost you a lot of money.
Your Inexperience Could Cost You
How many times have you negotiate closing costs, sales price, or even repairs with a home buyer? I’d bet you can count them all on one hand. Like it or not, most real estate agents have much more experience in the industry than you will ever have, and in real estate, inexperience can translate into financial losses.
Why? Cause some real estate agent’s are constantly educating themselves to be better at their job; negotiating on behalf of their clients. They work hard to obtain certifications such as the certified negotiations expert designation. If a buyer is more well-versed than a lone ranger seller on how & when to properly negotiate items in a real estate transaction, then potentially thousands could be at risk. Via lifehack.org
There are numerous steps to take before home selling, and it involves complicated processes which may overwhelm you. Things like negotiating, sales price, market exposure and repairs may be too much for sellers to do on their own without being disadvantaged.
Next, you don’t know the current value of your home. A new post from Bankrate discusses why FSBO sellers tend to overprice their home because they think their house is worth more than what is expected:
Do I know the value of my home today?
A common mistake FSBO sellers make is pricing their home too high, leaving the property to languish on the market.
“When a home sits for a long while, buyers start to wonder what is wrong with it,” says Piper Nichole, author of “The For Sale By Owner Handbook.” “The best option is to come out of the gate priced right.”
To market a home competitively, sellers should research the final sale prices of similar properties in their community.
Real estate websites typically offer local sales trend information, selling prices for comparable homes (“comps”) in the community and the average length of time on the market. But these websites do not have all the data that a real estate agent has access to, so it might be worth asking a Realtor to perform a market analysis or hiring an appraiser. h/t bankrate.com
Lastly, you’ll be spending less money while potentially earning more money when hiring a real estate agent:
You Net More Money When Using an Agent
Many homeowners believe that they will save the real estate commission by selling on their own. Realize that the main reason buyers look at FSBOs is because they also believe they can save the real estate agent’s commission. The seller and buyer can’t both save the commission.
“Properties listed with a broker that is a member of the local MLS will be listed online with all other participating broker websites, marketing the home to a much larger buyer population. And those MLS properties generally offer compensation to agents who represent buyers, incentivizing them to show and sell the property and again potentially enlarging the buyer pool.”
If more buyers see a home, the greater the chances are that there could be a bidding war for the property. The study showed that the difference in price between comparable homes of size and location is currently at an average of 6% this year. h/t lindahallsellshomes.com
The money you spend hiring a real estate agent can go a long way and will be worth it due to market experience and negotiating skill.