This past Thursday, I received a news alert article in my email inbox from my U.S. News & World Report. It spoke of how the National Association of Realtors and ForSaleByOwner.com, an internet based company that markets the houses of independent sellers, differed with each other's data on the percentage of independent sellers for all homes sold thus far during the housing downturn.
While the article provides links to both reasons to use an agent and reasons why you would consider not to, it marks the importance of what a realtor brings to transactions. The article tries to present both options in a neutral manner; however, when looking over the reasons, the only advantage to going independent is saving a little money. Even ForeSaleByOwner says that on a $300,000 home you could save a possible $18,000.
It is true that you can save money by doing the work yourself, but electing to go without an agent requires lot of time, research, and being able to negotiate and legally disclose what must be disclosed. It is also true that every person is capable of selling their house on their own. But just because you can do it, does not mean that it is recommended or wise.
The problem that I have with persuading people to try and sell their house independently is that only certain people can do it effectively. You cannot treat selling your house as a do-it-yourself project.
There is always going to be people who will chose to change their car's oil in their garage instead of taking it to Jiffy Lube. It is also popular to go to Home Depot and talk to a sales associate about how to strip and re-stain your deck yourself. What you need to learn to sell your house independently cannot be learned by skimming either a website or any For Dummies book. If you do something wrong, it won't mean a quick fix-it trip to the local hardware store — instead it can mean a lawsuit, lost time, and more time to sell your home than what it should have taken.
It is important to remember that your home is probably the biggest investment that you will ever make. Making a mistake in selling your home could cost you far more than hiring a professional agent will ever cost.
Here are a few advantages to using and agent rather than attempting to sell independently:
- The agent facilitates the whole transaction process from setting appointments/meetings, negotiating with furnishing legal documents, and taking on related menial work.
- An agent will help you with liability issues. We live in a society where people bring law suits for anything. If there is misunderstood statement or a problem not disclosed can lead to big problems. A professional and experienced agent will know what must be disclosed to a buying party.
- The agent can serve as a negotiator and can be necessary to ensure that all agreements are recorded and put on paper. A potential buyer may find it hard asking the owner for a lower price; however, and agent can negotiate on the owner’s behalf.
- An agent can separate emotion from price. An agent knows neighborhood prices and can help you price your home so that you don’t cheat yourself and drive away prospects.
- An agent has access to resources. An agent has the ability to include your home in the Multiple Listing Services (MLS). An agent will save you money from having to buy your own yard sign, buy and print your own flyers and pay for newspaper advertising.
- Using an agent will save you time. Are you ready to give up weekends to hold open houses? Do you have the time to perform your own market analysis to properly price your home? Are you available for appointments during the week, evenings and weekends? Do you have a flexible work schedule? Remember, you may not sell your house quickly, so this could go on for months.
- Most people who are serious about buying a house will use an agent. They want to make a quick transaction and will not waste their time driving around neighborhoods looking for "For Sale by Owner" signs. Agents are not going to show your house — you are on your own to attract buyers. Better hope those ads work.
- Most importantly, you can sell your home worry free. Using an agent provides peace of mind. Most people are unfamiliar and sacred about what types of forms, inspections, regulations, tax liabilities and laws there are concerning property transactions.
It is important to evaluate your own situation. Do not let success testimonials easily persuade you. Just because you knew someone who got lucky selling their house independently does not mean your experience will go so smoothly.