With the internet and listing sites like Zillow, Realtor.com and Trulia, you don’t need a realtor to find a buyer for your home necessarily. There are compelling arguments for not hiring a seller’s agent IF YOU WANT TO DO THE WORK (and it it work).
As the seller, you will have to pay both the buyers realtor (typical 3% of sales price) and your own realtor (typically 3%). The average cost is 6% of your sales price. That can be a lot of dough – $30,000 on a $500,000 house.
Exactly what benefits would a realtor provide me? Read these and decide if the value is enough to justify the price. ‘
You will very likely still have to pay the buyer’s realtor 3%, but this is specifically about whether or not you should hire a sales agent and what they can (and can’t) do for you.
1.) A realtor will market your home
The internet is really what markets your home, not the realtor. Savvy buyers are on the internet looking at homes and telling the realtor which homes they want to see. Many times your realtor doesn’t even get the message if someone calls and asks for a showing of your home. How exactly is that marketing your home?
A good realtor who knows your area really well might have a buyer that is looking your neighborhood. As the seller, you don’t have to pay a realtor to find your home, the buyer does.
If someone calls to see your house the realtor didn’t find that buyer. The sign in the yard did or the internet listing. The call is often not even answer by your realtor. It is taken by someone else who doesn’t know you or your home.
All listings, even ones that have a realtor, are viewed by buyers on the same three primary sites – Realtor.com, Zillow and Trulia. You can even pay a small fee ($200) to get your home listed in MLS (Multiple Listing Service). This is the tool that all real estate agents use to list your home for sale, but you can do it yourself if you feel like you aren’t getting enough exposure.
2.) A realtor will help you price Your home correctly
Realtors absolutely will tell you what they think your house is worth. BUT I believe if you like research you can learn what homes are selling for and figure this out on your own.
In today’s market I don’t believe that only a realtor can tell you what your home is worth unless you are living in a very high end neighborhood.
You can look at homes that are comparable to yours online with a few hours of research. The math is not that difficult.
I put together a simple sheet that shows these facts about homes near mine: square footage, list price, number of bedrooms and bathrooms. If there are homes within a few streets of yours that have sold or are for sale you can look up this information on Zillow. You can even look at the finish out to see if it is similar by checking out photos.
Take the 5-6 homes that are most similar to yours in size, age and location and divide the list price by the square footage. This gives you the per square footage dollar amount that your house is worth. In my case the average per square footage price of the comps was $317. This told me my house was work somewhere between $300 and $315 per square foot is the right price.
A realtor would probably encourage you to use the bottom end of market because the house sells faster. They don’t make much more commission if your house sells for $315 per square foot or $300, and they have to do less work if it’s priced to move fast.
For example, if the house I’m selling sold for $315 per square foot vs. $300, the realtor would only make an additional $1200 while I could make an extra $32,500 if I sold at the top of the range.
3.) A realtor will help you with the contracts
When I bought my house using a realtor (because the seller pays both the buyer’s realtor 3% and the seller’s realtor 3%), he spent less than 5 minutes completing the offer. The contracts are very standardized for each state. There are lots of guides online that will help you as much as your realtor if you are willing to take the time to do a bit of research.
Also, keep in mind as the seller, the buyer (and probably the buyer’s agent) will complete the contract when the buyer makes an offer. As the seller, you don’t generate the original offer the buyer does.
A purchase contract has a few important blanks that you need to review carefuly, the rest is pretty standard. The critical boxes are the price, how much will be in cash vs. borrowed and the closing date. These are the big ones. The other blanks are not nearly as important. I will discuss the most important details of the contract in another post.
The buyer’s realtor completes the initial offer unless you are lucky enough to find a buyer with no realtor – 0% commission!
If the buyer needs help, be sure to comply with the applicable rules in your state. In Texas, you can go to a web site and download the standard form that all realtors use. Most of the language is boiler plate and there are numerous reliable sources that can help you understand the forms.
4.) A realtor will give you valuable advice about what you need to do before you put your house on the market
Realtors do see a lot of homes and meet with a lot of buyers. They can take a look at your home and give you tips about what needs to be done before it goes on the market. This is true, BUT there are so many useful resources online that can give you the same advice for free!
5.) A Realtor will help you negotiate
This is the ONE area where a realtor can be worth the price. If you get the right realtor they can help you negotiate a better price once you get an offer. Selling a home can be a stressful process and negotiating is the most stressful part for me.
The realtor I have used in the past is really good at negotiating. You just need to consider how much that is worth to you.
In my opinion, the days when everyone needed a realtor to sell their home are over unless you live in a very pricey neighborhood. the internet has changed how your house is found and the realtor doesn’t really add that much to the equation (except taking money from the transaction).
If you have questions about selling your home, reach out in the comments. I believe that anyone can sell their own home.