Many people ask me why they should pay a broker a 4%, 5% or 6% commission. They believe they can “save” money by selling it themselves. Here are the top 8 reasons why working with a Realtor actually saves you time and money.
- High Success rate For Sale by Owners “FSBOs” are successful at selling about 14 percent of the time. Of that group, 7 percent knew whom they were selling their homes to ahead of time (friend, relative, neighbor, etc.) That means that true FSBOs are only successful about 7 percent of the time.
- Higher sales price. In 2012, The typical “FSBO” home sold for $174,900 compared to $215,000 for agent-assisted home sales. Which means a Realtor can get the seller up to 23% a higher price for their home than a “FSBO” . On a typical 6 percent commission, A Realtor sold home can net up to 17% more on the sale.
- Higher initial offer price. Typically, buyers who look for “FSBOs” usually offer 6-10% below the price of comparable properties because they know you are not paying a commission.
- Good marketing can attract a bidding war. A real estate agent at the top of his or her profession will know exactly how to market your home effectively.
- Time is of the essence. The longer a home is on the market the lower the final sale price is. Why? Because it acquires what is known as “market age.” Most buyers think that if the home has not sold after this long…there must be something wrong with the home. Market age is a deterrent to later selling at the proper market price.
- Conflict resolution Potential buyers often are reluctant to bring out and discuss objections with the owner because of the personal element involved. They do not want to put the owner in the position of defending his own home. Thus, an owner can’t represent himself properly with many prospects because the owner does not know that the prospects have unrevealed objections.
- Low litigation rate 71% of all real estate litigation is a result of one party not being represented in the transaction. This is the classic FSBO, because the buyer has an agent protecting their best interest while the seller does not. In fact FSBOs gets sued more than any other group in real estate.
- Navigating forms and documents 100 to 150 pages of documents and at least two dozen forms involved in the real estate transaction. The FSBO needs to be intimately familiar with each page. If they are not familiar with each form, I would never recommend signing a legal and binding document.
Please feel free to call me at 414.745.3339 or email me at [email protected] with any questions, or for a FREE market valuation of your home.