While FSBOs (For Sale By Owner) might have worked ok for sellers back in the 70’s or even the early 80’s, these days with the reach of the MLS online, it really doesn’t make sense not to use an agent when you go to sell your home.
Many sellers think that saving the 3% of the sales price, a typical real estate commission is 6% where 3% goes to seller’s agent and 3% to buyer’s agent, is a big deal.
One of the big problems of not using an agent is finding out what your home is really worth.
Sure you can hire an appraiser who will give you an idea of what your home is worth at that exact moment in time, but what happens if 3 more homes similar to yours go on the market 6 weeks after your appraisal is completed?
How would you know what prices these homes are listed for sale at, unless you were scouring the area on a weekly basis? Seems like a waste of time to me!
What if the market is starting to appreciate and you are stuck at a lower price?
How would you know that you could raise the price of your home $10,000 or even $20,000?
Chances are you wouldn’t know and now you are losing money…
Also if your home isn’t listed on the MLS, it won’t get the reach to potential buyers that it should receive.
Posting your home every 2 days on craigslist is not going to give your home the exposure it needs.
Next, what kind of home selling & negotiating experience do you have?
Do you know all of the paperwork that is needed?
If you need to move in a hurry, do you know transaction negotiation techniques to really entice potential buyers so you can find a buyer quickly?
Most likely the answer is no.
I know of a guy who lost his job and found himself struggling to make his house payment and he knew he had to downsize.
Because he was kind of cash poor, he thought he would save $15,000 by not hiring an agent and selling the home himself.
He did know a real estate agent so he asked him to run some comps in the area to find out what his home was worth.
He did and he listed the home at $550,000 which was about $10,000 high at the time, but he wanted to give a little wiggle room in case he had to negotiate on the price.
Now because all he had was a for sale sign in his front yard, the real estate agents in the area didn’t know what the list price was and they did not stop by, knock on his door to ask because most agents don’t like dealing with FSBOs.
He was losing precious buyer traffic!
Believe it or not, an entire year went by and he didn’t sell the home.
Then all of a sudden out of the blue came 3 interested parties all at the same time within the span of a week.
He told them all the list price and they went back with their respective buyer agents to present their offers.
Only problem was, similar homes in the area were now closing at $570,000 and values were increasing, but he didn’t think to double check with his real estate agent buddy so he didn’t know. By this time he was worn out, struggling and very mad because he had to downsize and stop robbing his retirement savings to pay his mortgage.
He ended up selling the home for $18,000 less than what was market value at the time.
Plus the winning buyer made him do a ton of repairs costing him another $6000.
He didn’t even try and negotiate the repair costs down, because he didn’t know he could do that.
In the long run, he came up around $24,000 short.
The commission he would have had to paid to hire a buyer’s agent was roughly $16,500.
Right there he was short $7,500 because he tried to do the sale himself…
Do yourself a big favor and hire a real estate agent when you go to sell your home!
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