- 1. FSBO Homes Typically Sell for Less
- 2. You Still Have to Pay the Buyer’s Agent
- 3. It’s Hard to Get Noticed in the Real Estate Market
- 4. Real Estate Transactions Come With Legal Complications
- 5. Real Estate Agents Are Objective
- 6. A Real Estate Transaction Takes More Effort Than You Think
- 7. Your Real Estate Agent Can Help You Buy as Well
- Find a Real Estate Agent You Can Trust
Why Work with a Realtor: 7 Reasons to Hire a Real Estate Agent
In 2021, FSBO homes accounted for 10% of total transactions according to the National Association of Realtors (NAR). In a hot market, you might be tempted to forgo hiring a Realtor and list your home yourself. Why work with a Realtor if buyers are already at your door?
Also in 2021, the typical home sold without a real estate agent sold for 32% less than ones that used an agent.
While listing your house on your own seems like a good idea at first, it might not give you the savings you expect. It also means a lot more work than you might have time and money for. Learn the benefits of hiring a real estate agent to sell your home.
1. FSBO Homes Typically Sell for Less
Home pricing is a key skill for most real estate agents. If a home is priced too high, it won’t get much interest from home buyers. This can cause a house to sit on the market. If a home is priced too low, the seller will sell for under value (and the Realtor will receive less in commissions). Most real estate agents have a variety of tools that provide analyses of home values so they can help you choose the best price for your property. They also have years of experience with pricing.
This expertise pays off. In 2021, the average home sold for $330,000 when represented by a Realtor. The average FSBO home sold for $225,000. That is a 32% difference.
There are multiple reasons for this discrepancy. Sellers might be underselling their homes or will negotiate with buyers in order to move the property quickly. If the sellers and buyers know each other, the seller might make a favorable deal. However, inexperience means that many FSBO homes just sell for less.
This data highlights the math behind hiring an agent. If a Realtor can sell your house for 10% more than you could by yourself, then the three percent commission you give them won’t matter. You are still turning a higher profit by working with an expert. It is in the real estate agent’s best interest to sell your house for as much money as possible because they earn more as well.
2. You Still Have to Pay the Buyer’s Agent
Another thing to remember when you decide to skip hiring a Realtor is that you are still responsible for the commission paid to the buyer’s agent. Oftentimes, sellers think they will save a lot of money on commissions, but they still owe around three percent to the other real estate agents in the deal.
The only time you don’t have to pay any commissions on a sale is when both the buyer and the seller aren’t represented by a real estate agent. This usually only happens if both parties know each other or are related – like a parent selling a house to an adult child.
When you choose to list a house without a real estate agent, you have to take on all of the work to market the property, review offers, draft various sales documents, and work with home inspectors and appraisers. You will do all of the work that a seller’s agent does while still paying at least half of the commission levels to the buyer’s agent.
Before you list your house without a Realtor, decide whether the effort is actually worth the three percent commission that you would otherwise pay to a professional to close the deal.
3. It’s Hard to Get Noticed in the Real Estate Market
Real estate professionals have to be marketing experts to get their clients’ homes noticed. A large part of the selling process involves making a property seem appealing to buyers. They accomplish this by taking quality photos and hosting open houses, but also by working quickly to drum up buzz.
When you decide to sell your house, the agent will upload its information to the multiple listing service (MLS). This is how sites like Zillow find and share properties. Most buyers who are on the hunt for new properties use these sites and can even sort listings by when they were posted. Realtors pay for MLS access and it is hard to upload your home without a real estate license.
If your house has been on the market for a few weeks, it might not even show up in some search results anymore. Buyers also might be wary of properties that no one else seems interested in. Hire someone who has the market knowledge to make your house seem new and attractive on the market so home buyers want to check it out.
4. Real Estate Transactions Come With Legal Complications
An experienced agent will have marketing skills to promote your home but also the legal know-how to protect you during the sale. Each real estate transaction comes with several documents that protect both parties from scams and abuse. For example, the seller is legally required to disclose any known defects in the house, otherwise, the buyer could move into a damaged property they previously thought was in good condition.
There are ways to make sure you are protected when you are listing your house as FSBO. You can work with real estate attorneys to draft documents and go over key terms related to the sale. However, it might be easier and safer to work with a professional real estate agent who knows what they are doing. They can explain any legal terminology you need and won’t charge you by the hour for their services.
The expenses in the home-selling process can add up. You can pay out of pocket for professional photos, legal services, and other related costs, or you can hire a single real estate agent to cover all of this for you.
5. Real Estate Agents Are Objective
Most people have an emotional attachment to their homes. This is completely understandable. You likely spent countless hours improving your current home and celebrated major milestones on the property. You can see where your child took their first steps or where your significant other proposed in front of your family.
Unfortunately, emotions are a bad thing in real estate. You might not agree with the best price that an experienced Realtor recommends for your home because you think it is worth more. If you are listing your property as FSBO, potential buyers might be put off by your high pricing and unwillingness to negotiate.
Working with a real estate agent allows you to bring in a fair and objective party to sell your house. They will understand that the buyers want to completely repaint your home and won’t take it personally. You can take a step back from the stress and emotions of this business transaction so the agent can get a better deal for your home.
6. A Real Estate Transaction Takes More Effort Than You Think
The real estate industry is incredibly complicated and often requires more work than people expect. Not only will you need to market your home to potential buyers, but you will need to be in constant contact with their real estate agents to schedule home inspection appointments and appraisals.
An agent understands how long all of this takes and can set aside an appropriate amount of hours to sell your home. They can dictate their bandwidth because this is their full-time job. However, as a homeowner, you might find that this process is more time-consuming than you want it to be – especially if you are in the middle of a home search for your next place to live.
By working with a real estate agent, you can sell your house without taking time away from your job, family, and hobbies. There is less stress on your end. Plus, you won’t have to learn the nuances of home selling just to sell one property.
7. Your Real Estate Agent Can Help You Buy as Well
If you are looking to buy and sell at the same time then you definitely need to work with a real estate agent. These agents can gain access to hidden gems before they hit the market and help you get your bids noticed. Plus, if you work with the same agent to buy or sell, they might offer you a discount on their commission fees. This means you save money on the home sale while getting a leg up as a home buyer.
It’s important to look beyond the money when deciding whether or not to hire a real estate agent. A quality real estate agent can make a huge difference in your selling, buying, and moving processes.
Find a Real Estate Agent You Can Trust
Oftentimes, people are tempted to sell their houses on their own because they had poor experiences with real estate agents in the past. They don’t want to risk hiring another bad listing agent. Our team at FastExpert acknowledges that there are a lot of average agents out there which makes it harder to find the best real estate agent for your needs.
Our goal is to pair you with a great real estate agent who you will love. You can review profiles of real estate agents in your area and choose the best ones to reach out to. You will never receive unsolicited calls from agents through our system. Get to know some of the top real estate agents in your area and make sure you are properly represented by a Realtor you can trust.