Step 3.  Go for sale by owner or go with a real estate agent?

There are few sellers out there that are delighted with having to pay around 6% commission to sell their homes. Many will feel like they are just throwing money away. I will avoid getting up on soap box, trying to convince you of all the stuff agents do for their commission, both the activities you see and don't see them carrying out.

As with any service industry, you are free to go and try it yourself. If you are determined enough, willing to put the time in and price your home correctly, you can succeed going solo. However, unless you find a buyer who is representing themselves (not working with a realtor), you are still going to have to pay a commission to the buyer's agent. If you set their commission too low, you will risk lower numbers of agent / buyer viewings.

I definitely admire those who are willing to "give it a go!" and many people are particularly good at it. If you don't succeed you can always pick up the phone. 


Finding a good Agent.
As promised, I have attempted to show you both sides of many scenarios throughout this website and in keeping with that spirit, did you know that in surveys of the general public real estate agents are rated below second hand car salesmen?  I wonder how bad that makes the second hand car salesmen feel?

Joking aside, the top two complaints of those who have worked with agents is (1) they do not listen and (2) they do not return calls.

Obviously, this does not apply to every agent out there. Finding a good agent up front will greatly increase the likelihood of having a good experience. Ask your friends who they have worked with and how they would rate them, talk with agents at open houses and see if they are compatible with your way of thinking (personality fit), or you could go with this sparkling character, i.e.  Conor MacEvilly.

Try calling them a few times and see how quickly they get back to you. If they take too long, go with someone else. If they start showing you 3 bedroom craftsmen when all you are interested in is 2 bed townhomes, go with someone else. As when choosing a lender, particularly when you are a first time buyer or seller, it is advisable to work with someone who will sit down and spend time with you in person and explain the whole process.

Remember that if after receiving repeatedly poor service, you are free at anytime to terminate the "relationship" and look for another agent.  Time spent up front choosing a good realtor will make the whole experience a lot less stressful, and hopefully successful.

For Sale by Owner (FSBO)
The biggest motivation for homeowners who want to sell their own home is to avoid having to pay a sales commission. On average, the total commission a seller pays is around 6%. Usually 3% will go to the buyer's agent and the other 3% will go to the seller's agent.

When you list your own home you will not have to pay the listing agent's 3% commission. However, you will still have to pay the buyer's agent a commission if one of their clients buys your home.  Agents work on commission and if you offer too low a commission then they may not be too keen to bring potential buyers to see your home.

If you decide to go FSBO you will need to decide how much of the process you can complete by yourself. This includes adding your listing to the MLS, preparing professional-looking flyers, deciding on the listing price, dealing with the purchase and sale agreement and other paperwork, negotiating offers, holding open houses, etc.

An often quoted statistic (plus or minus a few percent) is that 85% of all FSBOs end up going with a real estate agent in the end because they were unable to sell their home by themselves.  According to a survey by the National Association of Realtors, in 2007, 12% of sellers went the FSBO route, down from a high of 18% in 1997. Some of this may be due to the increase in complexity of the overall process.

I attempted to find some independent third party statistics but was unable to find any. Websites dedicated to FSBOS tended to have glowing statistics in favor of selling your home whereas the opposite is true for real estate agent side. The real stats probably lie somewhere in between.  

Continue to Seller's step 4.  It's showtime

Return to Seller's step 2.  How much is my home worth?