Are you on the verge of listing your home for sale and contemplating doing it on your own? Whether that means a good old hardware store FOR SALE sign or a "somewhat" fancier "slightly" more expensive private company. Well then I encourage you to read ahead and learn and understand some facts that might help you understand while FSOB (For Sale By Owner) might not be the best direction for you.
I'll start with some simply math. Lets say you go the FSBO route and list your home for, lets say $300,000,ok. WOW that's a $15,000 savings at the normal 5% commission rate, RIGHT? Well I hate to say think again, but here's why.
Chances are if you find a buyer to purchase your home, 99% of the time they will be using an agent, and seeing as agents have to eat too, I can assure you they wont be working for FREE. That being said the buyers agent will be looking to earn his living in one of the following ways.
1. Collecting a 2.5% ($7,500) commission from you the Seller
2. Going in strong with a reduction of your listing price and having his buyer pay the commission
3. Meeting both you the Seller and his/her buyer in the middle, still collecting 2.5% ($7,500) in earnings
OK OK, so you are still up $7,500 by going the FSBO route, RIGHT? Well WRONG again.
If you choose to use a private company (I wont mention any names, NO FREE advertising here my friends) then you can be looking at upwards to a $1,500 fee just for their services. No BIG deal your still $5,000 ahead, RIGHT? Keep reading to find out why not.
Has anyone every told you your time is money? Well it is. I won't speak for everyone here, but I believe it is safe to say that our lives are already too busy as is.
Be prepared when going the FSBO route to invest at least 100 hours, and during those 100 hours be prepared for the following.
1. Missing your Child's sporting events, dance recitals or just plain old quality time.
2. Leaving work early, or taking days off (probably also costing you money there)
3. Late night e-mails
4. Loss of weekends
5. Dealing with no shows
The list can go on and on, but say at 100 hours x $25 (some people suggest $100) were at another $2,500.
So your savings is now from $15,000 down to $2,500 RIGHT? I really hate to say this, but I'm going to keep going.
My last major point will reflect back to the standard 5% commission most agents will use for listing your property. I may take some abuse from the real estate world with this next thing I am going to say, but for me it must be said.
WOW did I just say that? Just hear me out before you Jump Off the couch like TC. If you choose to list your home with an agent (me in particular) and buy your new home with that same agent, chances are many agents may agree to cut 1% commission from your listing. So on that $300,000 we talked about, it amounts to another $3,000.
Wait one minute here, we were at $2,500 now minus $3,000, that's a +$500. Looks like I just saved you money.
Yes I know all these numbers might not always work out, but for the most part I believe they do and there are other things to realize too.
1. Did I actually list my home high enough according to the current market.
2. Will you go the FSBO route, spending time and money only to list with an agent 6 months down the line
3. Will you be happy missing events, family time and other luxury's while selling on your own.
There can be a lot of stress just simply moving house, why don't you leave the stress of selling your home to the experts.
Please contact me at firstname.lastname@example.org if you would like to discuss buying or selling your next home
Thank you for reading my Blog!