(Originally written in February, 2015)
I read an article recently that talked about the importance of having a real estate agent involved in a transaction, as opposed to attempting to sell a house by yourself. “For Sale By Owner” sellers generally aren’t aware of everything that is involved in a transaction, and usually end up costing themselves more money than they would if they paid a Realtor. There’s a lot more to the job than getting the house listed in the Multiple Listing Service. According to the Orlando Regional Association of REALTORS®, there are over 230 possible actions that take place during a successful real estate transaction. I’m not fully convinced of that number, but I can tell you that there can be up to 20 people (or more) that are ultimately involved, including lenders, appraisers, attorneys, handymen, buyer’s agents, inspectors, and many more.
An agent can help guide a seller to the details of preparing the home for the market so that it can sell quickly and for the most money. It is a fact that homes that show well and are priced right sell quicker. I can attest to one situation where the homeowner was told to install granite countertops, do some painting and minor decorating, and that would help their home sell. They opted not to do it, but the agent listed the house anyway. The home was priced higher than it should have been, and it sat on the market for months. When the listing agreement expired, the sellers did the things that were originally suggested, then tried to sell it themselves. After about two more months on the market the house sold – at a price about $10,000 less than it would have if they had done the repairs to start with. On top of that, there were about 7 more mortgage payments made while they waited for the sale!
There’s a lot to be said for Open Houses. Without an agent, the sellers are in a difficult position of having to host the Open House themselves. Inevitably, something will be said that will “compromise the negotiating position” of the seller. Why do you think Listing Agents want their sellers away from the house when it is being shown?
Then there are the forms – Contracts, Property Disclosures, Repair Requests, Deeds, Settlement Statements, etc. While agents are not attorneys, they are indeed well-versed in the meaning, intent and interpretation of the documents. For most sellers, these documents are very confusing (however, they make great sleeping aids for insomniacs).
Yet another statistic from the article indicates that, according to the National Association of REALTORS®, “the typical FSBO home sold for $208,000 compared to $235,000 among agent-assisted home sales”.
As this article states, “You wouldn’t replace the engine in your car without a trusted mechanic. Why would you make one of your most important financial decisions of your life without hiring the right professional for the job?
Noted “financial guru”, Dave Ramsey, advises “When getting help with money, whether it is insurance, real estate or investments, you should always look for someone with the heart of a teacher, not the heart of a salesman.” I couldn’t agree more.