Why You Shouldn’t Try to Sell Your House Yourself

We always see a number of FSBO {For Sale by Owner} listings throughout the year but is it a good idea? The short answer is no.

why you shouldn't try to sell your house without a realtor

For Sale by Owner refers to the process of selling a home without the assistance of a real estate agent. Even in the best market conditions, unless you have a lot of real estate knowledge and experience, most people aren’t equipped to sell a house on their own.

According to Zillow, 36% of sellers tried to sell on their own but only 11% actually ended up closing without an agent. This means a number of these sellers are going to all the trouble of listing their own home and then still end up hiring an agent in the end. And a number of FSBO sellers aren’t selling their homes at all.

Reasons Why FSBO is a Bad Idea

The biggest factor that leads to people trying to sell a home without a real estate agent is the commission. A seller typically pays a commission of about 6% of the sales price {3% to the listing side and 3% to the buying side}. Even when selling a house yourself, you can expect that you will have to pay a buyer’s agent fee {3%}. The commissions may seem high but a listing agent tells you how to prepare your house for showings, usually has the home professionally photographed, markets the house continually until it’s under contract, and ensures that your house is being seen by potential buyers.

Homes typically sell for less when not listed with a real estate agent. Statistics tell us that homes listed by the owner sell for 5.5-26% less. This may be due to faulty pricing on the front end or poor negotiating on the back end. Whatever the reason, that’s money that should be in the pocket of the seller. Selling with an agent can often get you a higher price even after you pay commissions. Even on the low end, if you only increase your price by 5.5%, it’s almost equal to commissions paid but the owner hasn’t had to deal with the hassle of selling.

Selling a home involves a level of expertise that most people don’t have. When an agent represents a seller, they take care of the legal documents, determine market value, negotiate on behalf of the seller to ensure they’re getting a fair price and the best terms possible, determine whether a potential buyer is qualified, and do all they can to protect the seller’s interests in the transaction. The real estate market fluctuates constantly and it can be tricky for someone to keep up with the changes if they aren’t working regularly in the field.

Statistics tell us that when people try to sell their house themselves, it takes at least a week longer than when an agent is used, unless the seller already has a buyer lined up. And in a buyer’s market, it can take far longer. This means sellers need to factor in carrying costs of having the house on the market inlcuding additional mortgage payments, insurance coverage, property taxes, and utilities.

Selling a house yourself means you have no one representing you. That can be really hard. Selling a house is often an emotional task and an agent can help take the emotion out of the transaction. And if there’s a buyer’s agent on the other side, a seller really needs someone going to bat for them.

Marketing may be the biggest reason why you shouldn’t try to sell your own house. Real estate agents have access to MLS {an online listing service}, meaning your house is being shared across the internet to interested parties and agents, as well as being shared to third party sites like Zillow. The hardest part of selling a house is getting feet in the door and this is one of the big advantages of hiring a listing agent. We have networks of professional contacts, access to buyers, and tried and true strategies to market properties.

Another major challenge of selling your home on your own is that it can be a time-consuming and demanding process. You will need to handle tasks such as advertising your home, scheduling showings and open houses, and responding to inquiries from potential buyers. If you have a busy schedule or are not familiar with these tasks, it may be difficult to manage them all effectively. When I’ve spoken with owners trying to sell their home, this is one of the biggest issues. If you work outside the home and have a traditional work schedule, you aren’t able to accommodate showings. And again, if people aren’t getting in the door, you aren’t getting your house sold.

A house is the biggest investment most people own and hiring a professional to help sell it is generally the best idea to protect both your investment and your sanity.

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