Sellers face all sorts of tough choices these days, the first of which includes: “should I use a real estate agent or go the for-sale-by-owner route?” As a REALTOR® I obviously have a dog in the hunt but I can see both sides of the seller’s dilemma. I understand that paying a commission eats away at the bottom line. In this market, a few thousand dollars can be the difference between a seller’s break-even point and a situation where money will have to be placed on the closing table. So if you are in a position where you want to sell your home, here are some starter questions for you:
1. Do you have more than 6-months to sell your home?
2. Do you know what comparable homes in your area have sold for in the past 6-months and how your home currently appraises?
3. Do you have the resources (time & money) to execute a competitive marketing strategy?
4. Do you have the resources (time & money) to track changes in the market?
5. Are you comfortable negotiating? Note: buyers in this market have a hard time settling for anything but a “steal” and generally consider FBSOs over-priced (whether they truly are or are not at fair market value).
If you answered “no” to any of these questions, you then face the root of the seller’s dilemma: do you waste potentially precious time – as mortgage rates start to creep back up and the market continues to fluctuate – trying to find the answers through trial and error? Or do you invest in a professional?
Again I’m biased here at AuburnLakeMartin.com, but the simple truth is this: real estate agents spend their work days thinking about the market and the most effective marketing strategies for resales and new construction. We have diagnostic tools, advertising budgets and comprehensive resources at our disposal. We can access years of data, isolate sales information by neighborhood, determine the current going rate in price per square feet and see what sort of incentives other people are pitching in to get their homes to close.
And really: if it’s hard for us to stay on top of this particular market, how do FSBO’s expect to stay competitive?! FSBOs are competing with the entire market, not just other FBSOs. I feel strongly that, right now, the only scenario that makes sense as a for-sale-by-owner is one where the seller is in no rush and simply wants to see how the market responds to their list price. If that’s worth the setup time and advertising effort – go for it! In fact, most agents will be happy to send some market data and well wishes your way, gratis! Just be prepared for lowball offers, if / when they start coming in.
Your home is an extremely personal possession, but its sale is strictly business. Sellers need to take a long, hard look at the costs (direct and indirect) and benefits of listing a FSBO. In general, FSBOs are often wildly over-priced, poorly marketed and under-incentivized.
As an aid to sellers who are considering making the move to listing with an agent, here is a partial breakdown of what a REALTOR® brings to the table:
- Professional consultant
- Listing syndication, including local/regional Multiple Listing Service (MLS)
- Regular market reports and CMA (“comparative market analysis”)
- Consistent, scaled marketing services tailored for each seller
- Trained negotiator
- Access to the largest pool of active, local buyers
- Area Expert who can communicate to buyers a wealth of local knowledge
- Strong Social Media Presence
I could wax on regarding the benefits of securing an agent’s services, but I’ll leave it at that for now. If you have questions please give me a call. Meg Fullington 334-332-7698 If you’d prefer to communicate via email mailto:firstname.lastname@example.org. I welcome your comments and questions regarding For-Sale-By-Owner homes versus listing with a REALTOR®.
**this post was edited on June 1, 2012