As a person who is by nature a “do it your selfer” I understand the desire to want to “try it on your own” first in regards to selling or buying a home. I mean who would not want to try and save money right? Or do you really save money selling or buying on your own?
On the other hand, I am also a professional Interior Designer and Realtor so I understand and have experienced the value in hiring a professional to complete their respective trade. There is a reason they are called a Professional, that is there gig, all they focus on, so they become an expert in their field. When you are selling or buying something that is your most expensive purchase you will most likely make, why would you not want a Professional handling that for you????? Let me say this in another way, would you ever just give hundreds of thousands of dollars to your toddler and hope they know how to put it away nice and in a safe place. Probably not – most likely you would hire a banker, investor, or realtor to help manage that kind of money and investment. I am not suggesting you are a toddler or do not know more than they do, only pointing out that they are well meaning but not an expert in making decisions in regards to items with high value.
It is the same thing when hiring a realtor to help you sell or buy a home. The trend I see if you are thinking of going “By Owner” you start out listing your home on Zillow or Craigslist and you most likely have priced it a bit out of the range than it should be at and you get a lot of interest right away. So much so you think for sure an offer will be coming soon. Buy if you do get an offer, do you counter or just accept, do you even know what the paperwork means? Have you considered or agreed to pay a buyer’s agent if they bring a client to you to buy your home? (you should or you will not get their clients period. They charge 3% that is the standard). Let’s say you did not get an offer and here you sit a week or two later, no offer and now your house will start to look “Stale” or “Un wanted” even though there is probably nothing wrong with it, you just don’t have the facts and stats behind your pricing nor the reach and experience and Real Estate agent would have to get this sold. Remember a real estate agent has made this profession their expertise and that is all they do day in and day out. You have only just “tried it out”. So let’s say it has been 4 weeks and you have already reduced your home price by $10-$15K and now you have decided to bring a professional (a Realtor) in the get this “SOLD” since people are not biting on your home while you had it listed “By Owner”.
The Realtor comes in – provides you with a complete CMA (Comparative Market Analysis), that shows you what the “Market” has deemed the value of your home. Simply put, what someone perceives your home is worth or is willing to pay for it. I know we all think about the new counters we just added, or the new faucet and hardware we put on in the kitchen, but the market is sometimes not that specific. It comes down to an overall value (that even as a professional, seems to be a fluid measurement), including, Square footage, Location, Layout of rooms, condition of home, updates (do they appeal to others or just the current home owner). For example, you could have spent $6K on new counters but selected a very unique color stone that will not be pleasing to the masses, it does not automatically make your home worth $6K more than another home. There are several items in the home that follow this model, however things like, new roofs, furnaces, AC units, appliances, insulation, and more, those are pretty concrete and yes add value, but are also part of Home ownership and regular maintenance. So yes it is expected that you keep your home maintained and up to current living standards and upgrade your roofs, mechanical, windows, and appliances when it is needed. You will receive value in your home for this, but not necessarily leaps and bounds more than your neighbor’s home.
Back to the Example: You have hired a professional realtor , they have come in explained to you what the “closest” market value they can at the time and you decide to list your home at this price (which is probably lower than where you started). You get pictures taken, because those wide angle lenses do actually make a difference. Your agent lists the property on the MLS, it is much farther reaching than just Zillow or Craigslist alone. And if they are good, they are letting their entire data base know about your home and working every day to find a buyer for your home. You hope you get an offer right away – but now the initial buzz of your home has already passed and those initial amount of serious lookers have already seen your home and thought you had asked too much for it and most likely they have moved on. You might end of up sitting on the market for a bit and even taking another price cut to get this house sold.
So after all that – nationally you have ended up losing 8-12% of potential proceeds from you home and months of showings, because you wanted to save the initial 6% from hiring a Realtor. I am not suggesting all scenario’s go this way, but as I have been watching and paying close attention I would say the majority follow a similar path.
In the end it is always better to hire the professional! As a Realtor I hire professionals all the time, and they are worth the money that they are charging. Same goes for the Realtor, there is a lot more that goes into selling and buying a home than meets the eye. So next time you are thinking about “going it alone” and “selling or buying by owner” maybe just save yourself some money and time and hire the professional from the beginning.