In today’s world, everyone does everything without expensive professional services. People trade stocks without a stockbroker. People create wills and trusts without attorneys. Many even remodel homes without contractors. As self-sufficient as everyone is, why wouldn’t you want to look at the benefits of selling your house without an agent?
Simply put, agents cost money. An agent’s commission costs about 6% of the final sale price. If a property sells for $500,000, this can cost sellers $30,000. This amount is split between both the buyer’s and seller’s agent.
The amount taken from the final price is hefty. Taking commission out of the picture is a huge advantage, especially if a seller has a high mortgage that needs to be paid off. Remember that just because you don’t have an agent as a seller doesn’t mean you can prevent the buyer from having one.
Many sellers pay two to three percent in self-represented sales to the buyer’s agent. However, if you are new to real estate sales, the buyer’s agent may try to negotiate a bigger commission because he will likely be doing work on both ends of the transaction to make up for your lack of experience and understanding.
Though you can’t force the buyer to not have an agent, if there is no outside representation, it doesn’t become negotiating power to say you are more flexible in the price. Buyers may feel they are able to negotiate a better price without an agent because they know the amount of savings in the transaction.
Beyond negotiating, sellers may feel they are more qualified to sell and negotiate than an agent is. Sellers who are well-versed in real estate transactions may be comfortable with the process and negotiating items at different points in escrow. When a seller is comfortable dealing with a buyer or buyer’s agent, he can save at least 3% of the commissions by representing himself.
The transaction may also be very straightforward. Maybe the house is a new build, or it’s being sold as is and the seller doesn’t want to negotiate. Buyers are able to come in and make offers without expectation for repairs or credits. Sellers who are set with their price and properly provide all disclosures and documents may not need agent representation.
Keeping Things Personal
Sometimes transactions are done among well-known parties. Well-known could mean family members, close friends, or even business partners. There may not be a need for an agent in cases like this, where everyone understands who the parties are and what to expect in the sale. There needs to be a lot of trust among all parties in this type of transaction scenario.
Legal sale requirements must be adhered to, even when both parties know each other. Follow all codes for disclosures and timelines. As a seller representing yourself, the last thing you want is to find yourself in a legal battle for a property you thought you no longer had any ties to. Follow the rules to avoid legal ramifications and penalties.
If you are unsure about whether or not you should sell your property, don’t hesitate to send us a message. We can help you decide whether you should use an agent or sell your property directly! Call today! (832) 662-2202