Some people wonder if they can forego hiring a real estate agent and sell their own home to save on the commission. I mean...how hard could it be?
These people obviously don't understand what agents do—the value they bring to a transaction through their knowledge and their network...not to mention navigating the legally binding contract for your biggest asset.
Your home is probably the largest investment you have and the idea of DIY'ing it to save on paying a commission is a risk I am not sure most people should take.
Can You Make More Money Without an Agent?
As a seller, you can find your own buyer. But an agent may be able to help you net more on your bottom line. According to the National Association of Realtors (NAR), the difference can be 40% or more...compared to the 5% or 6% commission you are trying to save.
In a seller's market, almost anybody can put up a for sale by owner sign and attract offers. That's because there is an abundance of eager buyers trying to purchase the few houses that are on the market...easy money, right? In this situation, be prepared to handle multiple offers, secure money from a buyer, get through a home inspection, close a deal, and make sure the contract details are correct. You should also be prepared to handle a possible lawsuit. There are a lot of details that need to happen properly in any contract, but especially in a real estate contract. You can be sued even after you don't own the home if you did not properly disclose things about the home in the sale.
In a buyer's markets, there are fewer buyers, which makes an agent's services and network even more valuable to you. Do you really have the time, knowledge, and network to actively market your home so that it will sell quickly and for the most money?
The Benefits of a Seller's Agent
Unless you routinely attend every open house in your neighborhood, you may not possess intimate information about the interior of your neighbors' homes nor know why some sold for higher prices than others. Experienced agents have this knowledge and use it to position your home to sell at the highest possible price.
Top listing agents sell homes every day. Services most listing agents offer to sellers include:
Marketing materials and proven selling systems
Professional virtual tours and photography
Wide internet exposure
Promotion at company meetings and multiple listing service (MLS) meetings
Networking with fellow real estate agents
Price guidance according to market data and recent sales
Home stager, inspector, and repair contractor referrals
Buyer feedback and private showings
Confirmation of potential buyer qualifications
Counteroffer and negotiation expertise, especially with multiple offers
Suggestions for dealing with low appraisals
Benefits of a Buyer's Agent
A buyer's agent's job is to put the buyer's interests ahead of their own and work confidentially. This means they must disclose all material facts, keep the buyer's information confidential, provide them with sufficient information to purchase a home, and expertly negotiate on their behalf.
There are several services you can expect to receive from a buyer's agent that you might not be able to obtain on your own. Apart from hearing about listings before homes are available to the public, agents can:
Provide comparable sales from the tax rolls
Provide sales data from MLS based on map searches
Pull property profiles reflecting sales history and property data
Obtain a copy of the home's historical documents
Run reports on the listing agent's list-price to sales-price ratios
Calculate annual facts and trends about an area
Suggest pricing strategy
Prepare a strong offer that presents the buyer in the best light
Review documents for loopholes and obtain disclosures to protect the buyer
Provide a buffer between you and the seller's agent
Know What You're Getting Into
If you feel competent that you can handle a sale or purchase on your own, or if you have some relative expertise, then you may choose to go it on your own and work without an agent. This is risky but in the end you do have the choice to work without an agent at your own peril. That being said, you might always wonder whether you paid too much or accepted too low of a price without the privileged data and agent has for reference.
Working with a real estate agent can bring a lot of peace of mind during a major transaction, whether you are buying or selling. And it can ultimately leave you with more cash in the bank...even after you pay the commission.
People have a notion that real estate agents don't do anything for the commissions they earn - those people obviously don't understand what real estate agents do.
Let's work together, call me >
