In today’s Real estate web market numerous websites are trying to entice owners to sell their property themselves and save on the commission. It all looks excellent on the surface – Saving $1,000‘s of commission. Can’t be a bad thing, can it? Simple answer…Yes – This saving can cost far more in the end selling price.
To engage an experienced, successful real estate agent to market and complete a sale, is the best option to save money. It is not about the commission; it is about getting a premium price for the property.
Here are some reasons why it is not a good idea to sell your own property:
1. Failure to price a property at what market conditions will bear
The number one reason that most FSBO’s (For sale by owner) don’t sell their homes is that their price is too high. Many start counting the money they are saving on commissions and how much their sale will net. If your house is priced higher than other comparable houses in your market, then the buyers will exclude your home from their list. We are regularly called into FSBO’s after they have been on the market for say 60 days with little inspections and no offers. The first mistake we see is that their home is overpriced.
2. The longer a home is on the market, the lower the selling price is Why?
Because most buyers think that if the home has not sold after this long period…there must be something wrong with it. In today’s market, it is imperative to get in the market and get out as quick as possible. With the market sliding backwards the longer you stay in the market then, the less you will get due to dropping market prices.
3. Owners are emotionally involved
All owners are emotionally engaged in their property, and for this reason, they should distance themselves from the purchaser. In today’s market, the low offers that may come will be an insult to the owner however for a good, hardworking agent it is the opportunity to work the buyer up in price to the level that the owner will accept.
4. Many buyers will prefer to deal through an agent
Most buyers find it incredibly awkward to negotiate or even to talk directly with sellers and therefore avoid FSBO properties. The reason for this is that in most cases they don’t want to insult the owner directly with their offer. They know that the owner will be emotionally attached to the property and as such would rather deal through a third person when making offers. To cut out the majority of buyers because the owner is an FSBO is a big mistake. The more people to see the property the better the chance of finding that person who will pay a premium price.
5. Selling yourself gives less marketing options
The FSBO websites are all based on listing the property on a web site (mainly one) and waiting for a buyer. To sell today, you have to do far more than that. The seller has to cast their net far and wide to catch the buyer. The best person to do this is a good agent. When our office lists a property, we place it on a total of 6 property websites. Local press advertising is still an essential ingredient in finding a buyer as the majority of buyers we come across are local, and they read the newspapers.
Another important advertising channel is digital marketing. To further cast the agents net, digital marketing is essential in today’s market. Other areas that an agent can offer are an extensive internal database. The new listing can be emailed to buyers in the market who have not as yet found the right home. There are also agent networks, property videos on YouTube, door knocking the neighbours, open homes, editorials, professional signs and the list goes on. Limited exposure can usually end up in a lower sale price.
6. The selling/buying process begins AFTER the buyer leaves your home
Most sellers think that all it takes is for someone to see their home, fall in love with the great decor… and the offer automatically will follow. Remember that the buying process begins after they leave your home. A buyer will often leave the home and start to talk themselves out of the buying process. That is where a good real estate agent steps in. The agent can overcome any objections and keep them motivated and on track with the buying process.
7. The agent does this for a living
By this, I mean that real estate agents are involved in property sales much more frequently than the average property owner is. This familiarity leads to a degree of expertise that provides an edge on negotiating and successful selling.
8. Accepting an offer is one thing, ensuring a safe and successful settlement is quite another
Real estate transactions usually always have problems before settlement. At times, expecting the buyers and sellers lawyer’s to fight it out or resolve the problems, can sometimes mean the deal is lost. The agent can get to the heart of the problem and possibly have it sorted before the lawyer has sent their first letter.
9. Has the FSBO the time and energy to make the sale
The whole process of listing the property, compiling an effective marketing campaign, executing the marketing campaign that will find the buyer, negotiating the sale and the after contract service that will ensure that the sale goes through to settlement, can be a lengthy and time-consuming period. Has the FSBO got the time and energy to carry this process out?
10. The commission is a success fee
You only pay the commission to the real estate agent, if they successfully sell your home at the price you are happy with.