Written by Blanche Evans
There are pros and cons to doing anything yourself. You weigh factors such as your expertise, the enjoyment of doing a certain task, and the cost savings of doing it yourself (DIY) vs. hiring a professional.
Are for-sale-by-owners successful? The answers may lie in research from the National Association of REALTORS®. According to the most recent Profile of Home Buyers and Sellers, the share of home sellers or SIYs who sold their home without the assistance of a real estate agent was only nine percent.
So where do SIYs get buyers? Not from testing the open market. Forty-four percent of FSBO sellers knew the buyer prior to home purchase, and about 15 percent of SIY sellers were approached directly by buyers.
This results in a lower median selling price for FSBOs than listed homes, $208,700 compared to $235,000. That means the typical listed home — a home listed professionally with a real estate agent – sells for 13 percent more than a FSBO.
The number one reason why SIY sellers don’t want to list their homes is real estate fees which can typically range from five to seven percent of the transaction. But, by not testing their homes in the open market they’re losing more money than the fees.
Significantly, more buyers are using sales professionals to help them find and buy their homes. In 2001, 69 percent of buyers used the services of a real estate professional. By 2011, that number had risen to nine out of 10 and remains true today. So if you’re planning to sell your home yourself, you may be dealing with a professional agent instead of the buyer across the table.
As a seller you should realize that buyers have changed. Today’s buyers are older, more savvy, and have better credit than in the past. The typical first-time buyer is 31 years of age, while repeat buyers are 53.
They expect to occupy their homes for approximately 12 years, so they plan to buy very carefully. In fact, more than half of buyers said finding the right home was the most difficult part of buying a home. The fact that you’re an experienced homeowner may not be as big an advantage as it once would have been.
Last, SIY sellers miss the advantages of having their own agents. When you SIY, you have to do everything the real estate agent would do — show the home, negotiate, advertise, and keep the transaction moving forward.
Those are just a few things to consider as you decide whether to list it or SIY.