Property agents are expensive and many sellers think selling a house themselves is a great way to save money. A seller may save a commission by selling a house themselves, but trying to sell a house without an agent may actually cost them more money than the commission they saved.
Real estate agents are experts in marketing, educated in the sales process and know how to value a home. I explain exactly why real estate agents get paid so much here; they are not paid just for the time they spend selling your house. They are paid for all the licensing courses and continuing education they must take. They are paid for their experiencing marketing homes and getting the most money possible for a seller. Here is a great article with more detailed information on tricks and tips to sell a house for the most money.
It is so important to value a home correctly
If you under price a home and get an offer over asking price, the chances are you could have gotten an even higher offer had you priced the home correctly. Most buyers will base their offer off of the list price and not what the home is actually worth. I hear it all the time from buyers; I offered $10,000 over asking price and still did not get the home! They are basing their offer on the list price assuming the seller is asking fair market value; they are not basing their offer on what the home may actually be worth. Another downside to an offer well above asking price is it may give an appraiser a reason to come in at a low value. If an appraisal comes in low, it could cost the seller even more money! By pricing the home right to begin with, you will almost always sell the home for the most money.
You may not save as much as you think when you sell a house yourself
When you try to sell a home yourself, it may appear you can save 5, 6 or even 7 percent of the sales price by not paying a commission (all commissions are negotiable). However most buyers work with real estate agents when they are looking for a house. If you are not going to pay the real estate agent representing the buyer a commission, then you eliminated most of the buyers in your market. Eliminating most buyers will definitely decrease your selling price and cost you money. If you do agree to pay a cooperating broker, you are only saving half of a commission. On top of only saving half of a commission, the buyer is represented by a real estate agent and you are not. Who will have the upper hand in negotiations and the selling process? The buyer’s agent will have the best interest of the buyer in mind, not yours. Here is a great article that describes all the costs associated with selling a house.
A realtor knows how to deal with a low appraisal
If you end up with a buyer who is getting a loan, they will most likely need an appraisal done on the home. The bank will lend the buyer money based on that appraisal and if the appraisal comes in low there is a good chance the buyer will need the price of the home to be lowered. We see appraisals come in low all the time with rising home prices and there is a way to deal with appraisers. A real estate agent knows how to be proactive to help the appraiser and knows how to challenge an appraisal if it comes in low.
A realtor knows how to market a home
There is a definite art to marketing a home correctly. You can’t just stick a home in the MLS and wait for offers to come in, unless you under price it. A real estate agent knows how to take the best pictures, do virtual tours, create the best brochures, what websites to use, which magazines and newspapers to advertise in and much more. Real estate agents also know people and a lot of people. Many times an agent will have buyers waiting for a house just like yours.
It is almost always better to use a real estate agent to sell a home instead of selling a house yourself. A real estate agent will make you more money on the sale of your home, even though they charge a commission.