Should you sell your house on your own or hire a real estate agent? This is a question that many homeowners face and often a hard one to answer when deciding to sell their property. If you're one of them, read on and find out if For Sale by Owner (FSBO) is for you or if you're better off using the help of a professional real estate agent.
FSBO Transaction vs. Real Estate Transaction
The apparent difference between the For Sale by Owner (FSBO) transaction and the real estate transaction is the involvement of real estate agents in the latter.
If you choose to engage in a house for sale by owner, you're selling your property without the assistance of a professional real estate agent.
According to the National Association of Realtors, nearly 40% of sellers choose FSBO for the following reasons:
· They believe that they can sell their property without the help of a real estate agent.
· They already have a sure buyer.
· They want to avoid paying real estate agent commission.
The average commission for a real estate agent in Australia is 2%-4% of the property's sale price. Homeowners who opt to use FSBO think that they can save by foregoing the service of the listing agent. But in the same study conducted by the National Association of Realtors, 10% of those who engaged in a house and lot for sale by owner eventually ended up working with a real estate agent after realizing that it takes more work to do things on their own.
If you're still undecided about using a real estate agent, consider the following questions.
1. Do you have the time to market your property?
Marketing plays a vital role in selling a property. Unfortunately, not everyone has the time and skill to promote real estate properties.
Some of the work you need to do includes taking photos of your house, researching for local and regional listings, posting pictures of your property to multiple listing services, responding to inquiries from potential buyers, and scheduling an open house. These activities will require a considerable amount of your time which you may find challenging if you have a full-time job.
An excellent real estate agent can do all of that, and even more, to ensure that your property is noticed by serious buyers and achieve a successful sale.
2. Do you have extensive networks?
Unless you sell to friends, family, and colleagues only, you need more people to see your property listing.
Seasoned real estate agents have been in the industry long enough to connect you with potential buyers and local agents looking for properties on behalf of their clients.
Additionally, real estate agents have access to technology tools like multiple listing services that you won't be able to gain access to unless you pay a flat fee or an estate agent or broker yourself.
3. Can you price your property correctly?
Pricing a property is a tricky game. Many homeowners price their property based on how much most people in the neighborhood sell their house.
If you price your property too high, you're shooing away potential buyers.
If you price too low, you're acquiring a loss. This is a common dilemma for homeowners choosing FSBO. You can pay for a property appraiser, but that's an additional expense.
On the other hand, an excellent real estate agent will inspect your property to spot problem areas, explain if there's any need for restoration, and provide recommendations to increase the market value of your property.
Through this process, your agent can offer sound advice on the best price for your property.
4. Are you willing to deal with a ton of paperwork?
The National Association of Realtors reported that 10% of FSBO sellers find preparing and processing required documents too much to handle. This isn't surprising because a private house for sale by owner is a legal process.
Using a real estate agent can save you the hassle of completing paperwork requirements. Your agent can also explain specific clauses in the contract that you may find confusing and too technical to understand.
5. Do you know where to find potential buyers?
Buying a property is as time-consuming as selling a property, and hence, most buyers prefer to hire a buyer's agent who can deal with the complex transaction of purchasing a house. In this time and age of the Internet, real estate industry professionals use online platforms to connect with interested buyers.
If you are selling FSBO, your reach for interested buyers can be limited. However, with a good agent, your property listing is introduced to a broader market to ensure you get top dollar.
In conclusion, you don't need a diploma to become a real estate agent to sell your property successfully. Whether you intend to buy a house for sale by owner or sell your property, it's more efficient to work with a real estate agent than do everything yourself. Having your agent will make it easier to acquire your own home or sell homes.
Additional points to consider:
1. Buyers are hesitant to negotiate a higher price knowing that they are not dealing with an expert but a seller wanting top dollar.
2. By employing an agent to negotiate a price you can potentially get a monetary figure a lot higher than if you tried to sell it yourself. Many agents for this reason will choose not to sell their own house.
3. There is often the need to install special legal clauses into contracts to protect the parties involved. Without these clauses, parties can take on the risk of litigation and a considerable financial loss.
If you're still undecided or need additional guidance to make an informed decision, contact us for a free consultation.
