Times are tough, your home isn't worth what it was a year ago and now you've decided to move.
Do you need the services of a real estate agent to sell your house? Or can you realistically do it yourself and save thousands of dollars in agent commissions?
There are arguments in favor of each approach. Making the right decision about trying to go it alone should be based on a seller's personal circumstances, temperament and time constraints.
The advantages of going the for-sale-by-owner (FSBO) route are compelling. First and foremost, there is the cost savings of not having to pay at least half of the average 5 to 6 percent commission that is typically split between the seller's agent and the buyer's agent. There is the plentiful supply of regional and national companies that, for a flat fee of somewhere between $200 and $500, will place a home on their own sites and/or the Multiple Listing Service. Also, homeowners may be a property's best salespeople because they know the home inside and out.
But there are downsides to consider as well. Homeowners may be unfamiliar with the selling process and how it works, uncomfortable about letting strangers in their home and worried that they won't be savvy negotiators. Buyers may be more accustomed to dealing only with agents and not directly with sellers. There also is the argument that time is money.
"You hire people to do your plumbing—you don't do that yourself," said Pat Combs, immediate past president of the National Association of Realtors. "How much is your time worth? The truth is there are people who could do this. There are people that are natural salespeople that if they had all the time in the world, could do this."
About 12 percent of homeowners typically sell their home without the help of a real estate agent, according to the National Association of Realtors.
A month ago, Park Ridge resident Renee Castelluzzo began the process of marketing what will be the fourth home she's sold on her own in the past 30 years. She listed it on Web sites and the Multiple Listing Service, distributed 300 fliers for the $1 million-plus property, and sat in her home every Sunday with freshly baked cookies from 11 a.m. to 5 p.m. for an open house.
"You have to be patient," said, Castelluzzo, noting it took her 16 months to sell her last home, five years ago. "I wouldn't recommend it to someone who isn't a good people person. You have to make it a priority and be disciplined because you never know what Sunday that buyer is going to show up. You have to have somewhat of a sales personality."
Joel Epstein, managing broker of North Shore Buyer Brokers LLC, sold his own home a few years ago during the market's headier times but admits that if he were selling his home now, he'd probably lean toward using the services of an agent. "At this point, the market is so bad that you need all the help you can get in some [geographic] areas."
A recent seven-year study of the Madison, Wis., residential housing market by two Northwestern University professors found 20 percent of homeowners who initially tried to sell their own homes ended up working with real estate agents and placing their home in the Multiple Listing Service. But homeowners who stayed the course on their own did better financially.
"If I were to sell a house now, I would definitely try it for a few weeks," said economics professor Aviv Nevo, one of the study's authors. "The main issue is to get the pricing right."
Sellers who opt to go it alone need to research the market for comparable sales data so they set a realistic price, market the property, stage the house so it shows well and be available to take prospective buyers through the home.
Piper Nichole, author of "The For Sale by Owner Handbook," suggests putting a box of fliers next to the "for sale" sign in the yard. Before investing in online sites that list homes, find out how many pictures the property is allowed, whether a virtual tour is included and how many page views the site gets a month. Ask prospective buyers if they are pre-qualified or pre-approved.
Nichole also recommends scheduling showings for more than one prospect at the same time to create an implied demand for the home, and to be thick-skinned as people tour the home. "They'll say 'oh, your wallpaper is hideous, can we knock that off the sales price.'" Nichole said. "Don't take offense to comments because it's a negotiating standpoint."
Owners.com, a FSBO Web site, advises sellers, particularly in a difficult market, to work with buyer's agents.
"Most buyers are working with agents," said chief executive Steve Udelson. "What do you want to do, cut out three-quarters of the potential buyers? You're going to add lead time to selling your home and you might not get as high a price because you don't have as many people bidding. How do I sell my home for the least possible cost? Look at it through that lens versus how do I sell it without an agent."
THE LOCAL SCENE
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