When many sellers get ready to sell their homes, the first question many consider is, “Can I get away with not using a Realtor®?” With all of the For Sale By Owner (FSBO) websites popping up, it’s easy for a homeowner to think they can save money by listing the property themselves and not paying your commission. You and I know that’s simply not true and that homes sold by Realtors® sell for more and much faster, it’s been proven time and time again.
With lead generation being critical to the success of any real estate agent’s business, prospecting to FSBO’s offers an extremely targeted list of prospects/leads to target. The key is showing the person who has decided to go FSBO that it is in their best interest to use your services. Here’s some great objection handling information (which can be downloaded as a flyer…free) for you to use the next time you’re speaking with someone about the advantages of using a Realtor® vs. selling it themselves. It’s a no-brainer!
As a seller, you would still end up paying the buyer’s agent commission if you sell your own home. This means that your savings is not 6%, but rather 3%. That amounts to $7500 on a $250,000 house. While that may still sound like a significant amount of money, think about the amount of work you’ll do to get the word out. How much is your time worth? Realtors® really do earn their pay.
When you use an agent, they take care of listing your property. They do this not only locally, but also on the internet, where 90% of home buyers look before purchasing a home.
You can certainly list your own home online, but it isn’t free – sites with Multi-Listing Service (MLS) access charge anything from a $395 flat fee to $199 for a 6 month listing. And you want to make sure to hit all the major sites, free or paid. It’s the only way to make sure you are visible to all potential buyers and their agents.
A Realtor® will take care of all of these listings for you, so you don’t have to worry about which sites to use, how long they take to set up, or how much they cost.
When you use an agent, they receive all of the calls and weed out the ‘just curious’ lookers or others who would not be able to qualify to buy your house. When you list the home for sale on your own, you have to take ALL the calls and emails yourself. This is another serious time commitment. There’s nothing more frustrating than spending two weeks going back and forth with a potential buyer only to find out they never had financing.
An agent will have the experience to be able to tell right away if someone isn’t going to be able to complete a purchase. And, if a potential buyer does end up wasting their time, that’s part of what you’re paying them to handle. This way, you can spend time on your own commitments and let your agent handle the curious and the serious buyers.
There’s also the consideration of safety. Most experienced Realtors® won’t work with buyers who aren’t pre-qualified and pre-screened by a mortgage broker. Getting pre-qualified requires showing proof of identification, financial background, a credit check, etc. It’s good to avoid having complete strangers traipsing through your home with no record of who they are.
Real estate agents belong to a close-knit community and know how to build buzz about your property with other agents. In doing this, they are exposing your home to a market you wouldn’t have access to on your own. When a Realtor® can call up a professional contact and recommend they bring a client by, you have an immediate prospect that is actually ready to buy.
In addition, agents have a lot of experience setting up open houses and creating interest in their events. An agent isn’t going to want to waste time or money on an open house that isn’t attended, so they will put their network and advertising skills to good use on your behalf.
The key reason sellers choose to go on their own is to save money. Unfortunately, a real estate agent can offer significant expertise in setting a price-point for your property. They have experience in the area, so they know what price to ask for that will bring good value while also selling your property quickly.
Homeowners have the potential to fall off of both sides of the pricing wagon. Some homeowners love their house so much they price it inappropriately highly, resulting in it sitting on the market unsold for months. Others are unsure of themselves and need to move quickly, so they underprice their homes and cost themselves a lot more financially than they would have saved in commissions.
Ironically, the founder of ForSaleByOwner.com had to use an agent to sell his own home after he “mispriced” it and couldn’t sell it himself. Not only did he gain a lot of money in the price – even after the commission – the property sold quickly.
If you do find a buyer on your own, you’ll quickly realize the mountain of paperwork that it takes to complete a sale. It takes a lot of time to understand all the legal and financial forms you need to make available and sign with the buyer. A mistake in the paperwork and proper disclosures can open you up to serious liability or financial loss.
If you do sell on your own, the sales paperwork is an area where you can’t afford to go it alone. Make sure you do your research and perhaps even consult a real estate lawyer to help you draft the correct forms and disclosures so that you don’t find yourself in significant trouble later.
In the final analysis, you may save a few bucks by going the FSBO route. Unfortunately, you will also spend a significant amount of time, in addition to your current professional and personal obligations, to do so. You may also misprice your home, and you’ll need a lot of help with the final paperwork once you find a buyer. In the end, using a real estate agent is the easier and more affordable way to go.