For Sale By Owner: Who Needs a Realtor, Anyway?
You’ve probably invested a lot of money—not to mention time and effort—into your home. So when it comes time to sell, you likely want as big a profit as possible.
However, with broker commissions hovering at 5% to 6% of the final sale price of a home, sellers can stand to lose thousands when the transaction is finalized. On an average home sale of $200,000, that’s $10,000 to $12,000 down the drain.
To save on commission fees, a growing number of homeowners looking to sell are bucking the convention of enlisting professional help. Instead, they’re listing their homes online, on sites like Zillow and ForSaleByOwner—the latter of which has seen a 14% spike in listings over the past year.
Sites like these offer several benefits: They provide a wealth of data about other neighborhood homes, which allows sellers to price their homes better, and by posting images and information online, they can reach a much wider audience than with more traditional marketing methods.
There are economic factors at play, as well. Donald Van Dyne, developer of iGOfsbo, a website that connects sellers with buyers and their agents, told CNN Money, “Historically, for sale by owner [deals] ebb and flow with the economy. People use it when there’s a hot market, when it’s easier to sell their homes.”
Home-sellers who go it alone may end up with more cash in their pockets due to more than just a lack of commission fees: a Stanford University study found that homes sold using brokers sold for 5.9% to 7.7% less than those sold without the use of a broker (though the National Association of Realtors claims that homes listed by agents sell for more). This may be because brokers are willing to accept a lower sale price in return for a quick sale.
Though a professional broker could make your life easier when it comes to selling your home, if you’re willing to put even more time and research into the sale, you could come out on top.