Plenty of sellers believe they could potentially save themselves a few bucks by going it alone without the help of a real estate agent. Unfortunately, trying to sell a house without a real estate agent can actually cost sellers more money than the commission they might have saved. Agents are experts in marketing properties and negotiating fair prices, are educated in the sales process, and understand the ins and outs of valuing a property.
Here are some solid reasons why you should never take a real estate agent out of the home selling equation.
Setting the Right Listing Price is Tricky
List prices for homes for sale on the market aren’t just picked out of thin air. Determining a selling price is an art form, and needs to be done with careful consideration. Under- or over-pricing a home can cost you a ton of money.
The best opportunity to sell a house is when it first comes out on the market, particularly in a seller’s market. Buyers are waiting for the right property to be listed, so it’s crucial that the home is priced properly right from the get-go.
If you over-price your home, buyers might not even look at your listing. The property will likely wind up sitting on the market for weeks – or longer – until you have no choice but to lower the price to gain more attention. By then, the listing has gone stale, causing buyers to wonder if there’s something wrong with the property.
The longer a house sits around on the market, the more stigmatized they become. Even if you lower the price to the right value after a while, the property still might not sell for what it could have if you had priced it right from the start. And during all that time the house sat around waiting to be snatched up, you’ve been spending hundreds or even thousands of dollars in carrying costs.
Under-pricing your home can have financial consequences too. While you could sell your house really quickly, there’s a big chance you’ll leave a lot of money on the table, and sell it for a lot less than what it’s worth.
Many sellers may want to stir up a multiple offer scenario where a number of buyers are bidding for your property. While this could drive the price up a little, this scenario might only attract buyers who just want a great deal. Even if you wind up with a selling price that’s over the listing price, chances are you could have actually gotten even more money if you had you priced the home correctly.
The majority of buyers will base their offers on the listing price, and not necessarily on what the property is worth. They’ll just assume that you’re asking fair market value for the home. Pricing the property accurately based on fair market value will almost always help you sell for the most money.
Accurately valuing a home is one of the most important aspects of selling. Without experience, knowledge and MLS access, properly valuing a home is near impossible. It’s hard to get information on recently sold properties, which shows how much similar properties in your neighborhood sold for in the recent past. Active listings can give you a rough idea about the value of homes, but what if they’re over-priced? Real estate agents are experts at determining property values, which can take years to understand.
Real Estate Agents Know How to Market Your Home
Selling a house involves a lot more than just planting a ‘For Sale’ sign on the front lawn and adding a few pictures to your Facebook page. Marketing a property is complex undertaking, and one that requires the right tools and a little know-how.
A real estate agent will know how to take the best photographs and virtual tours to advertise. He or she will know the best websites and magazines to use, and typically have a lot of contacts to communicate your listing to. A lot of times these agents already have buyers waiting for a house just like the one you’re selling.
Agents also have access to the most powerful marketing tool in the world of real estate – the MLS. This platform allows agents to advertise listings to other real estate agents and their clients.
While there are some companies out there that offer low-fee MLS services, there are a lot of issues associated with them. For starters, the service might never even see your home in person, and possibly enter inaccurate information about it with no photos. As the seller, you’ll be responsible for taking calls and setting up viewings.
If you find a buyer that’s being represented by a real estate agent, you’ll still have to pay the buyer’s agent if your home was entered in the MLS. After you’ve paid the MLS listing company, and buyer’s agent, how much are you really saving at the end of the day? Top that off with the disadvantage of not having a professional represent you and assist you with contracts, negotiations, appraisals, and so forth.
Negotiating Can be a Challenge
Wheeling and dealing directly with a buyer can be an awkward scenario at best. While many might assume that there’s more transparency through direct negotiations between buyers and sellers, this is usually a tough relationship. An experienced real estate agent knows exactly how to navigate the waters of negotiating a fair price for your home. As a messenger, your real estate agent is typically in a better position to negotiate a higher without scaring off the buyers.
Realtors can also act as a buffer between you and the buyer, and prevent any potential bad blood from killing the deal. An agent can speak on your behalf in tough transactions and prevent the talks from getting too personal. Having a hard-nosed estate agent in your corner will represent your best interests without turning off buyers who want to nickel and dime you.
The Bottom Line
Sellers don’t save as much as they think by trying to unload a property on their own. In fact, many times they wind up spending more. The majority of buyers work with real estate agents; if you have little to offer the buyer agent, you basically eliminate most of the buyers in your market. This will do nothing more than reduce your selling price and cost you money.
And if the buyer is represented by a Realtor and you’re not, you’ll suffer during the negotiating process. The buyer’s agent has the best interests of the buyer in mind; you’re on your own. At the end of the day, working with a real estate agent can save you a lot of effort, headaches, and money.