The following information was written in response to clients of mine that were thinking of selling their home on their own.
"Selling on your own... I just wanted to mention that it is not as 'free' or as easy as it appears. Some facts to consider. Most home owners selling privately or through a posting on REATOR.ca still offer commission to the agent representing the buyer; most buyers want to use the services of a REALTOR because with regular MLS listings there are no costs for their services, and their interests are covered with regards to additional information about the property, market value and contract law, negotiations, as well as other services that we offer. I have found that there are 2 types of buyers; one kind sees a privately listed home and it scares them to act without representation so they choose not to look at it; the other kind sees a privately listed home and assumes that this seller is not paying any fees so they are going to get the house for a better deal. The problem with this theory, is that it is not possible for both the buyer and the seller to save what would have been the 'fees' connected with the sale of the home, and if the buyer isn't benefiting (and having to pay additional legal fees to review the contract) they often walk away and buy through their REALTOR elsewhere. Most buyers have Buyer Representation with a REALTOR, which means they have contracted the services of a REALTOR to help them with purchasing a home. This contract usually states that the cooperating brokerage (the brokerage representing the buyer) will be paid a commission through the listing brokerage. In the event that the Buyer purchases an unlisted property or a property that offers less commission, the buyer has to pay for the services themselves. To help my buyers, I always negotiate with the private seller the commission so the buyer does not have to come up with additional money. Because the buyer is used to having the REALTOR's services covered in the purchase of their home, it is another reason that they may choose to look at homes that offer commission to the Cooperating Brokerage.
Something else to consider, are the additional legal fees you often pay without REALTOR representation. The conditions and clauses we use are are often unique to the particular home, based on our training and experience. Lawyers generally charge more to review self prepared contracts or generalized contracts that can be found on the internet to help prevent possible legal issues.
There are also advertising fees that would normally be covered with a full service REALTOR.
As well, making the time to show your place to anyone who wants to see it. Over the summer that will be a little easier for you because of your schedules, but the summer is often the slowest time for the real estate market with spring rush over and kids out of school. (these clients are school teachers) It often picks up in the Fall up until December.
Negotiating is one of the biggest challenges... there is definitely a technique to getting the most money for your home, without losing the buyer and having the situation become very emotionally charged. When a seller and a buyer negotiate, it is often emotional, and personal. This can cost one side thousands of dollars- it really depends who is the more experienced negotiator or who has the most leverage.
If you talk to a lawyer, you will find that the number of legal issues increase with DIY contracts because pertinent issues and latent defects were not disclosed or properly dealt with in the Agreement of Purchase and Sale, leaving the seller at fault. It is very important to disclose all relevant information about the house to the buyer.
I am not trying to dissuade you from selling your home privately, I just think you need to be aware of the real costs, legal issues and the mind set of the average home buyer. I have some friends that have real estate experience through several past sales and purchases, and have had the time and knowledge to successfully sell their own homes, and I think that's great. My role is not to cost someone money for something they are willing and able to do themselves, I'm here to save the Seller money with my experience and training through proper exposure and marketing, my knowledge of contract law and use of my negotiating skills and taking care of all the details surrounding a sale. Not everyone is suited to representing their sale."