When considering selling your home, many people ask "Should I sell it myself (For Sale By Owner - FSBO) or should I hire a real estate agent?"
Of course, there are pros and cons to both. Let's take a closer look.
Why Go FSBO to Sell Your Home?
I believe there are two main reasons why homeowners consider selling the home themselves: money and competence.
Money Savings
Many Millennial and Generation X homeowners don't think they have enough equity in their home to hire an agent. These homeowners bought their homes between 2004-2008, may have put no money down and, therefore, may owe more on the loan than the home's current market value.
We talk to these homeowners every day. By selling the home themselves, these homeowners think they will net enough money to pay off the loan and move on to their next home. That may or may not be the case.
Real Estate Competence
Many Millennial and Generation X homeowners are very educated and tech savvy and think they can do a better job than many real estate agents. They may be right!
The average age of a home buyer is about 32 years old; the average age of a Realtor is about 56 years old. So there may be a big disconnect regarding technology, search, and mindset between many real estate agents and the millennial population. So, yes, I agree, some agents may not be worth the money if they cannot connect with today's real estate consumer.
What Goes Into Selling a House?
If you intend to go FSBO, these are the main components of a home sale that you will need to handle:
1. Pricing your home properly and competitively. Zillow is not the answer. You need to know about sale prices, seller subsidies, the overall housing and economic market and trends in your area. (See How To Use Zillow Or Trulia For House Hunting In The Baltimore Area).
2. Staging it to maximize its flow, features and amenities. Hire a staging expert if necessary (see Help Sell Your Home With Staging: Interview With Home Stager Joy Waida). You live in your home one way, you market it another.
3. Producing quality marketing materials. This includes photography, home videos, brochures and more.
4. Getting the word out by syndicating the listing to various websites, including the multiple listing service. I highly recommend that FSBOs consider coop-ing with buyer's agents (so even if you don't pay a seller agent, i.e., you represent yourself, you still pay a buyer's agent who brings you a qualified buyer) and therefore, you will want to be listed on the agent websites (the Multiple List) and the consumer websites (Zillow, Trulia, Realtor.com and more).
5. Qualifying prospects BEFORE they come in to your home. It is a dangerous world out there. Do not let people into your home whom you do not know. Qualify, qualify, qualify. Time consuming but so necessary. See How Effective Are Open Houses For Sellers?
7. Showing your home. Buyers want to see the home on their schedule and they want immediate gratification, meaning they want to hear back from you immediately. You need to have time and flexibility in your day to accommodate today's consumer.
8. Negotiating your deal. Are you a good negotiator? Have you thought through where you are going (see How To Prepare To Sell Your Baltimore Home: 10 Point Planning Checklist)? Make sure you know what you want and negotiate accordingly. Once the terms are in writing, it is hard to change them. So know what you want, what you can compromise on and get everything in writing.
9. Writing up the terms into a legal contract. This is complicated. Compliance and legal issues vary from jurisdiction to jurisdiction and are complicated. I highly recommend hiring an expert, an attorney or an excellent real estate broker, to assist you with the paperwork and disclosures. This is definitely worth paying money for. Don't be penny wise and pound foolish.
10. Navigating the pending process. Many issues comes up between contract and closing. Since you don't have a seller's agent, you need to stay on top of deadlines and details. How is your buyer's loan doing? Any issues with the appraisal? Are you meeting deadlines? What came up on the home inspection?
11. Preparing for closing. You also need to pack and move and handle your own details while also monitoring your pending transaction. Stay organized and on top of everything; it is the only way to stay sane.
12. Understanding your documents at the closing table. Once again, these legal documents can be very complicated. I highly recommend that you hire an expert to assist you at the closing table. You do not want to sign anything that you do not understand. So hire an expert; it is money well spent.
13. Staying calm. Moving and selling your home can be a highly emotional experience. Many people underestimate the range of emotions that they may feel while in the midst of the transaction. If you are a highly emotional person, you may want to consider hiring a middleman (an agent, an attorney, a therapist :).
If you have the time, expertise and temperament to handle all of the above, go for it! However, if you, like most people, want to hire some help, we are here for you.
Why Hire a Real Estate Agent to Sell Your Home?
Do we think you should always hire an agent? No. Frankly, many agents are just not worth the money. You want someone who can do all of the tasks above and who has a track record of handling the tough stuff. For example:
- Homes that don't get a lot of showings,
- Homes in communities that have lots of short sales,
- Buyers who have homes to sell,
- Buyers who have loan issues,
- Coop agents who don't know what they are doing,
- Lenders who don't tell the truth, appraisal issues,
- Settlement officers who try to rip you off and more.
You want an agent who has handled all of these issues in the past and can handle them for you should they come up.
Why Hire Yaffe Real Estate vs. Another Broker?
As an independent brokerage, we set our own standards and we have set the bar high. Very high. As a prior corporate attorney, I am very detail oriented, ask lots of questions, look at everything through the eyes of risk and tell it like it is. And I hire agents and administrative assistants who are the same way. We believe that you deserve the truth, even if it is not what you want to hear. You have to hear the truth so that you can make an educated decision for you and your family.
>> 3 Reasons Why Yaffe Real Estate Got Started In The Baltimore Market
>> Not Sure Who To Trust In The Real Estate Business?
In addition, as an independent brokerage, we have the flexibility and autonomy to get deals closed. Just want a contract written but no representation? We can handle that. Just want to pay an hourly fee for some consultation services? We can handle that too.
See, we know that not everyone wants full service and we can fill those niches with the same expertise and professionalism that we bring to our full service clients.
FSBO vs. Hiring an Agent to Sell Your Home: What is best for you?
We know what the other agents say (I used to work at those companies). They say "you can't sell a home yourself. It is so hard. You need an agent. Only crazy people sell a home themselves."
Well, frankly, that is just not true. You can sell a home yourself, but is it really a good idea? For some people it is, but for most people it is not. Too many details, too much time, and too much at risk for you to make a mistake. Better to turn it over to a professional who has a track record of real estate success.
Not sure what to do? Give me a call. We can help you weigh the pros and cons based on your time, your expertise, your temperament and your particular situation. No judgment, no hard sell, no pressure. Just the truth. Give us a call.
