I know there are a lot of people out there that are thinking of selling their homes. I also know that one of the first questions that most people ask themselves is if they should hire a professional real estate sales representative (an agent) or if they should sell it privately. I understand this question. As an agent, I know why you should hire me, but for an outsider looking in it can be difficult to understand our commissions and what you as the client will get for the money that you pay.
Afterall, the standard real estate commission is 5%. That is $15,000 on a $300,000 home. So you may think that acting as your own agent is worth the savings. I am here to give you some reasons why you might want to think again.
Can You Make Sure You Are Available At All Times?
Ask yourself, are you able to rush home from work every time someone wants to see your home? At the end of the day when you have already worked your 8 - 10 hours are you going to have the energy to show your home, book showing, market your home and take advantage of every possible opportunity to promote your home? Can you leave a meeting or stop what you are doing to answer the phone every time it rings with a potential buyer? Are you an expert in selling homes? Do you have any experience at all in selling a home? I am not 100% positive, but I am pretty certain that your answer to these questions is probably “no”. A professional real estate sales representative would be able to answer these same questions with a “yes”. Also, by using an agent you will get a lockbox on your door that allows other sales representatives to show your home even when you are not available.
Are You Wasting Your Time?
If you are still thinking that you would like to try to sell your home yourself, here is something else to think about. How do you know that everyone who calls you with an interest in your home, is actually worth your time. An agent can find out whether someone who wants to view your house is really a qualified buyer, just a dreamer or a nosy neighbour. It can be a lot of work and a major interruption every time you have to put your life on hold, make your house look perfect and show your home. A professional real estate sales representative is trained to ask qualifying questions to determine the seriousness, qualification and motivation of a prospective buyer. They are also trained to ask closing questions that help to move a qualified and motivated person to the point of purchase. A for sale by owner seller may lack this training and skill set.
What Do Potential Buyers Think?
It can be awkward for buyers to have the seller present, rather than the seller's agent, when they're touring the home. Potential buyers can be very uncomfortable when the current owner is in the house. When a seller is present, most buyers will rush through a house and won't notice or remember much about what they saw.
How Big Is Your Network?
Agents have a much larger network than you do. Anyone can list their home on a free website and put a sign on their lawn, they can even hire a pay per use type of company that offers different levels of service for a flat fee (which you pay for even if your home does not sell), they can even pay to have their home on the Multiple Listing Service (MLS) that agents use. But will that be enough? Even homeowners with a large personal and professional network can have a difficult time getting those people to let others know that their house is for sale. As a homeowner, you do not have relationships with clients, other agents or real estate agencies that will bring a large pool of potential buyers to your home. A smaller pool of potential buyers means less people looking at and showing interest in your home. This can translate into a longer waiting period to sell your home and possibly not getting as much for your home as you believe it is worth.
Lets think about that for a moment. If you are listing your home for sale privately and you do not have the same network of people as a professional real estate sales representative and therefore there are fewer people looking at your home, what happens when there is an agent who is representing a buyer and their buyer shows an interest in your home? It isn’t nice to say and really isn’t fair to that agents buyer, however, there are agents who may not want to show your property to their clients.
Will You Know How To Work With A Buyers Agent?
In a for sale by owner deal the buyers agent knows that there will not be a professional on the other side of the table and for this reason, along with others, they may actually discourage their clients from making an offer. Statistics have shown us that there are more closing issues with for sale by owner properties than with those that were listed and sold with a professional. There are agents who will only show privately listed homes to their clients if there is a severe shortage of homes for sale or if the list price is extremely low. It is also important to keep in mind that if a professional real estate sales representative shows and brings you an offer on your home, they will also be bringing you an agreement to sign that states you will pay them a commission based on the sale price, for selling your home to their buyer. This is typical.
When it comes time to work with an offer, you do not have the specialized negotiating experience that the buyers agent will have. This means that they are more likely to win the negotiation, giving you less money in your pocket. Add to your lack of experience the fact that you are likely to be emotional about the process, and without your own agent to point you in the right direction, you are more likely to make poor decisions.
Ok, step back and think about what I have said so far. You can hire a pay per use service to market your home and you will pay for these services if you home sells or not, also, if an agent brings you a buyer you will need to pay them a commission as well, plus you may loose out on negotiating a higher price if you lack the proper skills. All of these items really start to add up, and remember, you are doing this all by yourself with no professional representation to guide you and steer you clear of unfavourable situations.
Can You Remove All Emotion From Every Stage OF The Selling Process?
The guidance that you receive from hiring a professional starts before your home is even actively for sale. Lets be honest, when you are thinking of selling your home there is an emotional attachment. Most homeowners can’t see what is wrong with their home. Real estate sales representatives are experts in what it takes to sell homes. A qualified sales rep can walk through your home with you and point out changes that you need to make to attract buyers, sell quickly and get the most for your home. As on outsider, looking in, they can see flaws that you are oblivious to because you see them every day, or because you do not see them as flaws. An agent will also help you to determine which feedback from potential buyers you should act on after you put your home on the market.
Speaking of emotions. It is harder for you, as the homeowner, to keep your emotions out of the sale. By having an agent you can keep yourself one step removed and this makes you less likely to make a mistake such as overpricing your home, refusing to counter a low offer because you are offended or giving in too easily when you have a deadline to sell your home. A real estate sales representative can follow up with other agents or potential buyers without communicating a sense of desperation. If a homeowner does not use an agent they will also have to deal directly with rejection every time a buyer’s agent tells them that their clients are not interested. It can be very difficult for some homeowners to repeatedly hear negative comments about their home. An agent can take the sting out of the rejection and put a positive spin on negative feedback. Constructive criticism can be easier for a homeowner to accept when it comes from an agent who is on their side, trying to get the best for them.
What Happens If You Make A Mistake And Legal Action Is Taken?
On an serious note, you can put yourself at risk of being sued. There is a lot of paperwork involved in a home sale and it needs to be completed correctly by an expert. One of the most important items is the disclosures by the seller. Every seller has a duty to disclose any material fact that affects the value or enjoyment of the property to every potential buyer. A seller who does not do this can be held liable for fraud, negligence or breach of contract. The main issue that sellers have to deal with is whether a fact is material or not. Unless you are a real estate attorney, your agent probably knows more about disclosure laws than you do. If a seller who attempts to sell privately fails to disclose a hazard, nuisance or defect and the buyer comes back to them after they have moved in and found a problem, the seller could be sued. Don’t get me wrong, agents can make mistakes too, but they have professional errors and omissions insurance to protect themselves and their clients.
Ultimately selling your home is one of the biggest transactions of your life. You can try to do it alone to save money, but hiring a professional real estate sales representative has many advantages. Better exposure, experience negotiating skills, dedication of more time to your sale and help with keeping your emotions from ruining the sale. Also, the expertise that an agent brings to a complex transaction can help to reduce and even eliminate a lot of financial and legal pitfalls.
Please leave me a comment and let me know if you found this blog helpful. Now that you have finished reading this blog and you have weighed all of the pros and cons, it is time to take action! Contact me today. I would love to be the professional real estate sales representative that you choose to market and sell your home.