Selling or buying a home without hiring a Realtor
People told me the other day that they would sell their own home because they wanted to save money on a Realtor.
What can I say? I’d like to save money as well, when I sell or buy something; wouldn’t we all? But now I ask you, do you think it is all about saving money or are there more things to consider when you are selling or buying a home without the help of a Realtor? You bet you! And is it really true that a Realtor actually cost you money? Did you ever think of the fact that if you DON’T use a Realtor, THEN it will cost you money? Let me explain.
Let’s first look at selling your own home through websites like welist.com (which by the way has way less web presence than the MLS website). It might be less expensive than going through a Realtor, but on the other side, you have to be able to keep up with all the hassle and risk that is involved and the fact that you might not be very well protected. And do you really save money in the end?
Examples of the hassle that you as an owner have to go through if you do not hire a Realtor are getting phone calls from potential buyers, Realtors of potential buyers and Realtors who just want to solicit you for your listing. Depending on how aggressively you have priced your home, there can be many phone calls, each day. Then you have to arrange for all the prospects the showings of your home. Do you want to call each one of them for feedback? How about the questions you can get, like is your RPR up to date, can I view your title, what do the bylaws say about my pet, do Dower rights apply etc. Most home owners do not know how to prepare ahead of time, so they can easily answer all of these questions.
And how is your protection? If you work with a good Realtor, you know exactly what you need to disclose by law to potential buyers. Also, your Realtor knows exactly what questions to ask potential buyers that they, by law, need to answer. If you do not disclose, for instance, material latent defects of your property, you might end up being sued later on. If you do not ask the right questions of a potential buyer, the negotiations might end up negatively for you.
And is it really true that a Realtor actually cost you money? Did you ever think of the fact that if you DON’T use a Realtor, THEN it will cost you money? Let me explain.
It is a fact that most of the time, home owners price their home too expensive. The reason is simple: they do not have the tools to establish market value and because it is their home, their objective value is often higher than the current market value. The consequences are that there are not many showings and, therefore, less chance of any offers coming in. The danger of this in a real estate market that is not on the rise is that you are now chasing the market down; by the time you realize you were priced too high you may drop the price, but effectively you will be priced too high again for the current market. You might be ending up not selling at all or many (thousands of) dollars less than when you would have priced your home right the first time. That money would have been well spent on a Realtor in the end. And you would have been protected on top of that!
On the other side, if you price your home too cheap, you might end up with less money in your pocket than you should have. Again, money you would have been better off spending on your Realtor, with the legal protection as a bonus.
Let’s look at the buying part. A lot that goes for the selling part also goes for the protection a buyer would receive if he/she were to hire a Realtor. Do you know how to check the seller’s title, RPR or condo documents for potential problems? You just give the MLS numbers of the listings you like to your Realtor, and he or she will take care of all the rest; you just look at the homes and concentrate on making the right decision. Do you know how to write up a purchase contract, what to offer or how to negotiate?
Now, here is the best part for buyers; more often than not, the Realtor you hire is going to be paid out of the proceeds of the sale. This means that your Realtor does not cost you any money out of your own pocket. Some buyers think that if they do not hire their own Realtor, they will get a better deal on the home, but this is a widespread misunderstanding of how the real estate dynamics work. Because if you do not hire your own Realtor, the listing Realtor will end up with double the commission instead of getting a deal for yourself. AND, you are not protected by someone who only works in your best interest, as the selling Realtor only owes fiduciary duties towards his client, the seller.
So, ultimately, selling or buying a home is not as easy as many people think; it is often in your best interest to at least interview a realtor when you are considering selling or buying a home.
If it would help you to make an informed decision on to do it yourself or to work with a professional, please feel free to contact us to discuss all that is involved, totally free of charge and obligation!