Selling your own home can be tempting! It seems like a great way to save the six percent Realtor® commission and use that money to start your new life. You may think you have time on your hands so you may as well pay yourself rather than a Realtor®. You can sell your home like no one else because you know it better than anyone else. You may think acting as your own seller's agent will surely be enough to make it worth the savings. Here are some reasons why you need to rethink that choice.
There are many good reasons to work with a real estate professional when selling your house. Even during challenging times like the one we face today, the right Realtor® can add value to your transaction and guide you safely through the process. If you're considering selling on your own, please consider the following:
1. Your Safety is a Priority
During this pandemic, your family's safety comes first. When you offer your home yourself, you are the one who has to meet the buyers. Who else is there to let potential buyers into your home? You have to be the one to make sure they don't touch anything and that they use hand sanitizer or wash their hands before entry. If you list with an agent, you can shift that responsibility to the Realtor®, who is actually better trained to deal with the Covid-19 issues of accessibility to your home. A real estate professional will have the proper protocols in place to protect not only your belongings but your family's health and well-being too. From regulating the number of people in your home at one time to ensuring proper sanitization during and after a showing, and even facilitating virtual tours for buyers, agents are equipped to follow the latest industry standards recommended by the National Association of Realtors® (NAR) to help protect you and your family.
Besides the pandemic, there are other safety concerns. When a Realtor® is showing your home, they have the buyer's information and have vetted to make sure they are qualified buyers. You don't want to open your doors to just anyone that comes along.
2. A Powerful Online Strategy Is a Must to Attract a Buyer
Most buyers begin their search now online. With so many people working from home a quick check of new listings is a welcome break in the day! Of course, you can list your home for sale on Zillow, Redfin, and Craigslist. But will that be enough? A good Realtor® has a strong social media presence and network of buyers and sellers. When listing on the Multiple Listing Service a good Realtor® will also syndicate the listing to multiple other real estate sites, as well as, spend the money on online and mail advertising. A Realtor® knows how to find the best photographers, stagers, videographers, and more. Who do you think could get a larger pool of buyers to your home? You may say, "It only takes one!", but a small pool of buyers can translate into waiting longer to sell your home and possibly not getting top dollar.
3. Negotiating the Deal
First of all, selling your home is typically an emotional process. Having an agent keeps this in check by keeping you from making costly mistakes, such as overpricing your home, refusing to counter a low offer because you're offended, or giving in too easily when you have a deadline for selling. A real estate agent is trained to negotiate in your best interest.
It's difficult for a seller to keep their emotions out of the sale because there's no third party to bounce anything off of. Here are just a few of the people you'll need to negotiate with if you decide to sell your home by yourself.
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The buyer wants the best deal possible.
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The buyer's agent solely represents the best interest of the buyer (and still will want a commission for bringing the buyer).
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The inspection companies, which work for the buyer will almost always find challenges with the house.
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The appraiser, if there is a question of value from the lender.
As part of their training, agents are taught how to negotiate every aspect of the real estate transaction and how to mediate the emotions felt by buyers looking to make what is probably the largest purchase of their lives. An unrepresented seller is negotiating with all these professionals who are working against the seller and on behalf of the buyer.
4. Legal Risks for the Seller
A Realtor® that is working for you, knows how to write the contract in your best interest. A Realtor® has had many classes in "up to date" real estate law and contracts. A lot of legal paperwork is involved in a home sale and needs to be completed by an expert. One of the most important items is the seller's disclosures. The seller can be held liable for fraud, negligence, or breach of contract if he or she does not disclose properly.
The documentation involved in the selling process has increased dramatically as more and more disclosures and regulations have become mandatory. In an increasingly litigious society, the agent acts as a third party to help the seller avoid legal jeopardy. This is one of the major reasons why the percentage of people selling a home by themselves has dropped from 19% to 8% over the last 20+ years.
5. Weeding Out Unqualified Buyers for a Mortgage
Having a buyer who wants to purchase your house is the first step. Making sure they can afford to buy it is just as important! As a for sale by owner, it's almost impossible to be involved in the mortgage process of your buyer. You want people that are viewing your home to be qualified buyers and not just "tire kickers." A real estate professional is trained to ask the appropriate questions and, in most cases, will be intimately aware of the progress that's being made toward a purchaser's mortgage commitment. Further complicating the situation is how the current mortgage market is rapidly evolving because of the number of families out of work and in mortgage forbearance. A loan program that was there yesterday could be gone tomorrow. You need someone who is working with lenders every day to guarantee your buyer makes it to the closing table.
6. You Net More Money When Using an Agent
Many homeowners believe they'll save the real estate commission by selling on their own. Realize that the main reason buyers look at for sale by owners is because they also believe they can save the real estate agent's commission. The seller and buyer can't both save the commission. A study by Collateral Analytics revealed that for sale by owners doesn't actually save anything by forgoing the help of an agent. In some cases, the seller may even net less money from the sale. The study found the difference in price between a for sale by owner and an agent-listed home was an average of 6%. One of the main reasons for the price difference is effective exposure.
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.
