5 Challenges You Could Face Selling Your Home Without a Real Estate Agent
Written by
Martin Dasko
Edited by
Gary Dudak
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Based on data from Clever, home sellers without a Realtor or real estate agent earned $79,000 less in profits this past year than those who used a real estate agent. The survey also found that 80% of unrepresented sellers weren’t even aware of the average commission rate they were trying to save on.
Additionally, while many sellers without an agent likely wanted to save money, they were twice as likely to be unhappy about the process, and 54% wished they had chosen an agent.
With that in mind, here are some challenges you could face going the for sale by owner (FSBO) route — selling your home without a real estate agent.
You Earn Less in Profit
Even though FSBO sellers saved money on real estate agent fees, they didn’t come out ahead financially. According to the Clever study, their profits were $128,500, while the average profit of someone using an agent was $207,500.
There are many contributing factors to a seller’s profit, like the property’s size, condition and location, but one of the most overlooked factors is the listing price. If a home isn’t priced correctly, it could fail to attract buyers and stay on the market for longer than expected.
This is where real estate agents are helpful, because they have a vast knowledge of the local housing market and can help craft a listing price to maximize profits. The survey found that 49% of FSBO sellers regretted how they priced their homes, while 73% of represented sellers were satisfied with the agent’s price.
“As a homeowner, it’s easy to fall into a certain bias about your personal home or even an investment property,” said Billy Snelson, chief marketing officer at Move Concierge. “The aesthetics and improvements that matter to you may or may not translate to actual market value. An agent has the market knowledge, tools and experience to accurately price a property based on data and market dynamics.”
By hiring an agent, you can increase your chances of earning a higher profit margin, making it a worthwhile investment rather than a trivial expense.
Your Home May Not Sell as Quickly
The survey found that 29% of unrepresented sellers wanted to go through the process independently since it would be much quicker. This may sound surprising, but unless there’s already a buyer in mind, the process of selling your home can actually take longer without an agent.
In the long term, an agent can help with their expertise and marketing to ensure you sell the property quicker at the best possible price. The Clever study showed that 48% of unrepresented sellers felt their home would have sold faster if they had used an agent.
Hefty Unexpected Expenses
Since real estate agents offer their expertise, they could help you prepare realistically for expenses. The survey found that unrepresented sellers were twice as likely to report unexpected expenses than those with an agent. Various selling-related costs, like marketing and staging, are factored into the agent’s commission.
Some of the unexpected expenses included:
- Moving costs (33%)
- Repairs the buyer requested after the home inspection (32%)
- Transfer taxes (31%)
- Closing costs (30%)
- Legal expenses (30%)
Hiring a Realtor to help you sell the home will make you more prepared for the entire process so that you don’t get stuck or stressed out by expenses.
Marketing Can Be Difficult
“Sellers today can list their home on sites like Zillow or Facebook Marketplace, but without access to the MLS, you’re seriously limiting the potential exposure to prospective buyers,” noted Snelson. You also can’t ignore a Realtor’s marketing expertise when it comes to properly staging a home for photographs and videos, promoting through social media and utilizing advertising methods.
“Agents and investors provide helpful advice on staging, marketing strategies, and preparing your home for sale,” said Peter Hullinger, a real estate investor and owner of PeteBuysHomes.com. “Without this, you may miss opportunities to maximize your home’s appeal and leave money on the table.”
Determining the right amount of money to spend on staging and content creation surrounding your listing can be challenging. This is where it helps to have a qualified agent who will handle this for you.
“Homebuyers are getting more and more marketing every day, and cutting through that clutter to find the right buyers is a highly strategic endeavor,” Snelson added.
You Could Struggle With Negotiations
Snelson pointed out how inspections, repairs, financing and appraisal are negotiation points in most markets. He said, “Not to mention that real estate contracts are complex and vary greatly from state to state. Negotiation tactics also vary from state to state. A skilled agent knows the contract inside and out and is there to help guide the transition to a smooth close.”
Hullinger added, “Negotiating the best deal can be tricky without an agent’s expertise, especially if multiple offers or complicated contingencies arise.”
Finally, you must remember how complex the closing process can be, as multiple parties and documents are involved. Small errors or oversights could lead to significant delays or even jeopardize the entire deal.
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