Why does it matter?
Nowadays a prudent seller can do almost anything a real estate agent can. They can list their home on Zillow. There are companies like Opendoor that send them cash offers. BTW those companies low ball you! These companies are full of investors that try and buy low and sell high. I wouldn't waste my time. Sellers can take pictures of their home with their fancy iPhone and upload them to the Internet. Also, don't do that! Hire a professional photographer.
They can also market their home using Facebook and Instagram. These are all the things that sellers can do to avoid paying a real estate commission. Because let's face it, people want to save money and try to do sell their homes themselves. However, you don't want to go it alone.
A quick aside about real estate commissions. Every day people purchase goods and services. These goods and services are taxable. Depending on the county you live in taxes can be between 7.5% to 9%. Typical real estate commissions are 6%. So every day people pay a higher percentage in taxes than they want to pay in real estate commissions. Save yourself the headache and use an agent.
1. Overpricing Your Home
This is by far the most dangerous pitfall of not using an agent. You may think that your home is worth more than reality justifies because you've loved and cared for it so long. However, buyers aren't gonna care about that. They want to get the best price that they can. They don't care if you have spent $15,000 on a remodeled bathroom. Buyers are going to want to get the best price they can get.
Having an agent will really come in handy here. He will be able to guide you to an appropriate price for your home. They know the area better than the average home seller. It's their job to know and study the market. The good ones do this daily.
I can't stress how clueless some people are about the value of their homes. I've seen this happen many times. Someone will list their home asking way above market only to get ZERO interest. If you're serious about selling, you'll list at the appropriate price.
2. Poor Marketing Plan
This one is surely the culprit to many seller letdowns. What would be the best way to market your own home for sale? Well there is Zillow. That is true. You can get your home in front of many buyers this way. But other than that, what would you do to market your home?
This is where a lot of people fall short. A real estate agent is first going to get professional pictures of your home. Don't hire any real estate agent that skimps on doing this. SERIOUSLY! If they skimp here, where else are they skimping on.
The agent will also come up with other marketing ideas. They may come up with an Instagram campaign. They may decide on using postcards to market your home. You and your agent should sit down and really talk about what you want in a marketing plan. The point is this, the agent has many more resources available to them than does the person wanting to sell without an agent.
Oh and did I mention the MLS - Multiple Listing Service. A seller doesn't have access to the MLS. This is where the listing is broadcast to all the other agents. Now you'll have a network of agents trying to sell your house. And do you think that Zillow can do that for you? I didn't think so.
“If you think it's too expensive to hire a professional to do the job, wait until you hire an amateur"
Red Adair - Oil Well Firefighter
3. No Knowledge of Purchase Contract Or Disclosures
I think this is where going without an agent is the most dangerous. Do you have the full knowledge of the purchase contract used in your state. I can say that in California there are 32 headings to the purchase contract. I have them memorized, just ask me to recite them to you.
You may feel confident about establishing an appropriate price for your home and creating a great marketing plan, but how confident are you when it comes to every part of the purchase contract? I have spent countless hours studying the contract. This is what every great agent should do. He will know what is going on at all times with the transaction. The contract spells out all time lines and party obligations.
Oh and what about disclosures? Did you know that there are certain statutory disclosures that every home seller must make? If you miss one of these you could land in hot water.
Going without an agent is extremely risky. I would say it's like flying a plane alone. Yeah, you could probably learn how to do it yourself, but why would you not want a pilot?
4. No Representation
This is also a great point to make. Hiring a real estate agent is like hiring a lawyer. You want someone looking out for your interests at all time. Why go it alone? To me it doesn't make any sense why you would want to brave it alone.
The buyer will most likely have an agent. This gives them an upper hand in the negotiation process. Having an agent allows you to bounce ideas off of them. They will be able to tell you what is and is not possible during the transaction. What if the buyer comes in and ruins the drywall? What can you do about it as a seller?
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