For Sale by Owner vs. Hiring a Real Estate Agent
Home-selling can be a stressful and complex process. As a seller, you must find the right balance between getting the best possible price for your property and closing the deal with as little hassle and as few roadblocks as possible.
You can choose the traditional path and work with a real estate agent to get the job done. But more and more homeowners today are marketing their property on their own, choosing the For Sale by Owner (FSBO) option.
If you’re struggling with the for sale by owner vs. real estate agent choice, you are not alone. There are advantages and disadvantages to each option. Here is a breakdown of those pros and cons so that you can make the most informed decision when you sell your home.
For Sale by Owner – Pros
Avoid Paying Costly Commissions
One of the main advantages of selling your home on your own is that you don’t have to pay a commission to a real estate agent – sort of. The commission is the fee you pay to a real estate agent, and it is generally paid by the seller.
If both the buyer and seller have their own real estate agents, there will be a commission split of up to 6% of the home’s purchase price. If you sell your home on your own, you might not pay any commissions, or you might only pay a smaller commission to the buyer’s agent.
Full Control of the Listing Price
When you list as FSBO, you choose your listing price. This requires that you conduct thorough research into your area to ensure you get it right. In the alternative, you can hire a home appraiser to give you an accurate estimate of your home’s current value.
You Call the Shots
When you hire an agent, you are probably not making all the decisions. But as an FSBO, you have complete control over everything that happens with your home sale, including how you market the listing.
Manage Your Showings and Schedule
You get to manage your showing calendar so that it is most convenient for you instead of your real estate agent. This gives you more time to properly stage the home, and it avoids unpleasant surprises.
For Sale by Owner – Cons
You Might Price Your Home Incorrectly
There is always the possibility that you have priced your home too low or too high. If it’s priced too low, it will sell quickly, but you won’t get full value for it. If you priced it too high, it could take much longer to sell than you had planned.
Emotions Can Enter the Picture
When you’re selling something of value – like your home – it’s tough to keep emotions out of the equation. You probably have memories attached to the home and want to make sure you get the best value in a sale.
You Risk Making Costly Errors
Pricing your home wrong is just one example. There is also a lot of paperwork you need to do when you handle your own home sale. One wrong move could be costly. Fortunately, a qualified title company can help with many of these items.
The Process Can Be Exhausting
When you choose FSBO, you are responsible for all the logistics of your home sale – marketing, showings, contracts, etc. You also have to deal with tire kickers and must learn how to weed out unqualified buyers. If you have a full-time job or don’t want to invest this much time and effort into the process, FSBO may not be the best choice.
Hiring a Real Estate Agent – Pros
Access to Large Networks
One of the great advantages of working with a real estate agent is visibility for your listing. In other words, your agent will make sure that your listing gets in front of a large audience through the Multiple Listing Service (MLS) and their various contacts in the local market.
Pricing and Marketing Expertise
When you work with a real estate agent, you have an experienced partner who knows how to effectively price and market a home. They can research comparable properties and help you understand how various market trends will impact your experience.
Contract and Process Knowledge
Your real estate agent will handle the burden of completing legal sales contracts and addendums. They will also guide the entire process on your behalf so that you don’t miss any important deadlines.
Offer Objective Advice
Real estate deals don’t always go smoothly. If there are any hiccups, your agent can give you sound advice to navigate conflicts and get your deal to completion.
Hiring a Real Estate Agent – Cons
You Have to Pay Them
The average real estate commission for a full-service agent is as high as 6% of your home’s purchase price. This can be a significant expense. You can save some money by hiring a discount broker or selling your home on your own.
You’re Not Their Only Client
Most real estate agents have quite a few clients. Even though they value your business, few will be 100% focused on your property. So, you need to make sure you hire someone who is dedicated to client service.
Your Contract is Legally-Binding
If you regret your choice or hire a real estate agent who isn’t meeting your expectations, you may not have much recourse. Once you sign a contract with an agent, you’ll need to jump through some hoops to get out of it.
You Have to Find the Right One
If you’ve decided to hire a real estate agent, not just anyone will do. You need to find one who is compatible with you, or you’ll quickly regret your choice. Take your time to search for and interview agents so that you find one who shares your vision.
Need For Sale By Owner (FSBO) Assistance in Maryland?
Whether you choose the FSBO route to sell your home or decide to work with a real estate agent, you need a local title company you can trust. United Title has been providing high-quality title and escrow services to clients in Maryland for nearly three decades. When we work with FSBO clients, our experienced attorneys and staff helps guide your transaction from contract through closing. Contact us today at (410) 544-5441 to learn more about our services.