The temptation to avoid paying a commission and negotiating a DIY person-to-person real estate deal may be tempting. However, by and large, “For Sale By Owner” (FSBO) sales get far less foot traffic, sell for tens of thousands of dollars less than homes sold by licensed real estate agents, and cost more to prepare for the market.
Plus, the seller is on the legal hook without protection if something is improperly disclosed or anything goes wrong during the deal.
3 Reasons It’s Better to Sell Your Home With a Real Estate Agent
Even if you’re considering trying to sell a home on your own, we recommend meeting with prospective seller’s agents anyway. Of course, you may choose not to use them, but your preferred agent will be there if and when you change your mind.
Here are three top reasons it’s better to partner with a licensed real estate agent to sell your home.
1. More cost savings than you’d think
There are two types of FSBO transactions: those where homeowners already know their buyers (usually family members or very close family friends) and those selling to the public. In this case, we’re talking about FSBO properties competing in the mainstream real estate market.
When that is the case, sellers are typically unaware of all the costs of selling a home. For example:
- Appraisal fees
- Hiring professional photographers
- Paying for marketing
- Preparing and staging the home for the sale
- The little extras that make open houses more appealing (signage, balloons, snacks, etc. – multiple weekends in a row)
- MLS listing fees
- Attorney fees
When you hire a real estate agent, these are all taken care of through the transaction, which means you are not out of pocket. There is also another way to think of “cost.”
Money is one thing, but time and energy are another thing worth weighing in terms of “cost” or value. For example, marketing a home, showing it to prospective buyers, answering prospective buyer questions, scheduling and hosting open houses, and other related tasks take a considerable amount of time and energy.
When you add that to the other preparations involved (like the fact that you’re packing and preparing for a move), most FSBO sellers realize using an agent is the better path forward and change their direction after all.
2. No legal or paperwork responsibilities
Real estate transactions aren’t simple. They require a significant amount of paperwork, and everything must be done to the letter of real estate law – or you have a potential lawsuit on your hands. This is why all FSBO sellers should hire a real estate attorney. However, as you can imagine, those consultations aren’t cheap. So, if the most compelling thing about an FSBO deal is saving the commission, odds are you’ll more than pay for that in other ways – including attorney fees or a potential lawsuit if something goes wrong during or after the sale.
In the meantime, you must ensure all necessary paperwork is provided – and completed accurately. This is not something the buyer’s agent will want to help you with, and there aren’t any real estate agents giving out free support to DIY sellers. Working with an agent means all of the legal responsibility, sales logistics, and paperwork are handled for you.
3. Higher final sales price
NAR statistics also show that FSBO homes sold on the public market (other than those sold to family or friends) sell for an average of 6% to 25% less than comparable homes sold by real estate agents and listed on MLS. That is a tremendous difference.
If you take the halfway point, 15.5%, a DeLand home that sells for $425,000 using a seller’s agent is likely to generate no more than $361,250 when sold by the owners. There are several reasons for this:
- Undervaluing the home.
- Not marketing it accurately.
- Taking offers too soon due to fears the house will sit on the market longer than desired.
- Buyers know FSBO properties save on commission, so they’re less likely to offer as competitively as they would otherwise.
In almost all cases, hiring an experienced real estate agent and paying their commission makes more sense. As a result, sellers save money they would have spent on sales-related costs while also benefitting from a higher total sales price.
On the Fence? Meet With Southern Exclusive Realty
Are you on the fence about whether or not to sell a home with a real estate agent or try out your FSBO skills? We understand, but we also encourage you to meet with Southern Exclusive Realty beforehand. There is no obligation to use us, but cultivating a relationship now means you’ll feel more comfortable contacting us if you decide to use a selling agent after all.