Do you need an agent? Should you do a For-Sale-by-Owner?

Do you need an agent? Should you do a For-Sale-by-Owner?
Lucas Smith
Friday, April 29th
By Lucas Smith

Do you really need a real estate agent to sell your home? Should you do a For-Sale-by-Owner?

The simple answer to both of these questions is NO. No, you do not NEED an agent to sell your home. However, if you hire the right agent, the process will be much smoother, it will be done correctly, and you will expose yourself to much less liability during the sale of your home. 

So let me explain.

The process will be smoother because by hiring the right agent with experience in selling many homes per year, you will get the advantage of the agent doing this repeatedly over and over throughout the year.

Think about it this way: the average homeowner sells and moves 1-3 times in their lifetime! While the average agent sells 1-4 homes per year, the experienced listing agent that you are looking for probably sells at least 1-4 homes per month. That level of practice breeds proficiency.

Just like when I golf once a week, I have no expectations of beating the likes of Tiger Woods, you doing a For-Sale-by-Owner should expect your home selling skills to stack up against an experienced agent about the same how I should expect my golf game to stack up against a pro.

Now you are probably thinking, “Well, you're just saying that because you're a real estate agent,” and yes, I have seen this time and time again where a homeowner creates real liability for themselves by doing it themselves.

Remember, saying “I didn't know that was against the rules/law” is no excuse for breaking the rules. 

Also, as you are selling to someone what's probably the most expensive purchase of their lives to date, the duty is on you to make sure that you know and follow all the rules. Again, the liability is huge for you, the FSBO, this is why real estate agents carry Errors and Omissions insurance.

So should you do a For-Sale-by-Owner?

Let me answer that by asking a simple question: Do you Mr. or Mrs. homeowner want to maximize your profits from the sale of your home?

Multiple independent studies have shown that by using an agent, the average homeowner will net an average of 6% more for the sale of their home, than by doing a For-Sale-by-Owner. So with simple math, most FSBOs will pay a buyer's agent commission of 2.5%, which is about the national average for a buyer's agent commission currently, and the total national average for commissions is paying a total of 5% commission on the sale of your home, 2.5% to both the buyer and seller sides.

So effectively your average FSBO is spending 6% to save 2.5%. This is an effective net of 3.5% less on the sale of your home.

So here in Orange County, CA, the average home sales price is 850K. That's $29,750 less an FSBO would net by selling their OC home themselves on average. I don't know about you guys, but to me, almost 30K is a lot of money!

Now, if you are determined to do an FSBO, and are concerned about what you can do to maximize your value, please feel free to call me at (714) 406-1414 for a free report on "How to do a For-Sale-by-Owner on Your Home." I'm happy to send you this information free of charge with no cost and no commitment to buy or sell a home with me.