If millions of people sell their homes each year through an agent, that could suggest that private real estate sales is not the way to go. Of course it is not that simple and the premise that a person needs an agent is false.
It could be argued that even if an agent is required to sell a home, that agent will at least make the sale easier or more likely. I must say that there is no evidence to support that an agent will give you more money or a faster sale.
There are no industry figures comparing the two methods and even if there were, the results would be ambiguous at best. So, for better or for worse, we can only reason through the issue and make an educated guess.
Pro-agent people (mostly agents) would argue that only an agent has the marketing clout and inherent skill to achieve the highest possible price in the shortest amount of time. But is that claim accurate or indeed verifiable? A cursory look at the question would tell you that there are many variables, for example, is the agent good?
Are you acting in your best interest or your own, that is, a commission?
All agents freely admit that price is the ultimate determinant of the ability to sell, not the ability of the seller.
Agents, when they talk to each other, always say that if a house is reasonably marketed and not sold, it is the price that is the main problem.
If one accepts that price is the problem, then one would also have to accept that a lower price (by not paying thousands of commissions to agents) would help the house sell faster.
Homes sell homes and the best agents show up. They grease the wheels and maybe make the process a bit easier. In fact, some can make it difficult to sell.
At the end of the day, it’s only the price and exposure that sells anything … and that goes for houses or hot dogs. Ah, I hear you say … but what about the fact that the hot dog shopper is hungry? Is that surely a factor? Yes it is and so is the flavor of the hot dog. But all things being equal, if two hot dog stands have similar food and are next to each other, the cheaper one will become more personalized. Likewise, if a hot dog maker has a superior tasting product, it won’t mean anything unless people hear about their superior hot dogs and that’s known as (exposure)
So you see that price and marketing exposure are the only things that really matter and, until recently, real estate agents had a huge advantage in that area. But now the playing field is much more level and FSBOs can now get as much or more exposure than some agents. How can this be? Really simple. The average person, for sale by owner, has only one home that they need to promote and can spend more time and resources on that product compared to the agent who may have a hundred properties that they are trying to do justice to.
Interestingly, it is that very fact that most agents will point to as proof that you need them. They will use the analogy of having a supermarket to attract shoppers, whereas you don’t even have a corner store to promote your only product – your home. Now I think that was possible to some extent years ago, but now, thanks to the internet, the private seller can organize the sale of the house on their own like the greats. Using a private FSBO sales company and their own or the company’s sign, the average DIY marketer can gain the marketing reach that has eluded them in years past.
That’s not to say that selling your own home is easy without an agent, but who would be willing to bet that it will be easy with an agent?
It is debatable whether it is easier or more difficult, but what is not debatable is the savings you can make by selling yourself. The typical salesperson would save many thousands of dollars by going the DIY selling route and those are often thousands tax free too.
The key to all of this is that if you’re going to sell your own home, you need to service it in a way that gets you professional-level exposure. The best way to do this is to spend a small amount of the money saved on quality marketing.
We are not talking about rocket science here. Just set your price as precisely as possible and then tell everyone you can about your real estate … and that means more than a For Sale sign in your front yard.