Why You Should Use a Real Estate Agent to Sell Your Home

When it comes to selling a home, many people debate whether it is better to hire a real estate agent or to sell it themselves (For Sale By Owner, or FSBO). While it may seem like a way to save money, countless studies and real-life experiences have shown that engaging a professional real estate agent can provide more significant financial gains, faster sales, and protection against legal issues.

The Risks of FSBO

Statistical research indicates that over 85% of properties priced by the seller are either over or underpriced by approximately 15%. This can lead to either wasted time and reduced value for the seller or the risk of undervaluing the property and losing potential buyers.

A recent case in point involves a client who faced legal action after selling his home FSBO, violating multiple state laws. As a result, he faced a substantial financial penalty, and the financial situation had a significant negative impact on his personal and professional life. If he had opted to use a real estate agent, this scenario could have been avoided, as the agent would have handled the complying with legal requirements and marketing strategies efficiently.

The Benefits of Using a Real Estate Agent

In Texas, where I work, agents typically charge a commission of 6%, with 3% going to the buyer's agent and 3% to the listing agent. This commission alone can often cover the costs of marketing and other expenses associated with selling a home. However, the real work of a real estate agent goes beyond just selling a home; it involves a comprehensive range of services such as marketing, negotiations, contract management, property disclosures, repairs, and appraisals.

For instance, marketing a home on the Multiple Listing Service (MLS) access allows agents to reach a broader audience of qualified, end-user buyers who are willing to pay full price. In contrast, listing your home FSBO often means limited exposure mostly to investors who are likely to offer dramatically lower prices. Additionally, FSBO listings often lack proper pricing and can either be overpriced, leading to an unsold property, or underpriced, leading to a missed opportunity to maximize profits.

Closing Negotiations and Price Optimization

A skilled real estate agent can enhance the marketing process by optimizing the home's listing and negotiating with potential buyers to secure a higher price. They have the experience and negotiation skills to work with different types of buyers and close deals more effectively, often leading to a closing price that covers the agent's fees and provides a better return for the seller.

Furthermore, agents have the network and resources to market a property more extensively than a seller might on their own. This can significantly increase the number of potential buyers and improve the chances of a quicker sale. The MLS system also provides legal protection, ensuring that the agent will be paid for their work if the home is sold through another agent's listing.

My advice is to find and work with a reputable and experienced real estate agent. Not all agents are worth the commission you pay, but a good one can more than justify their fees through their expertise, negotiations, and marketing prowess. This not only ensures a higher sale price but also streamlines the home-selling process, making it less stressful and more efficient for the seller.

In conclusion, while the initial impulse might be to save money by selling a home FSBO, the potential financial risks and pitfalls are significant. By utilizing the expertise of a professional real estate agent, you can maximize your return, secure a faster sale, and avoid unwanted legal complications.