Many people wonder whether they should hire a real estate professional to assist them in selling their home or if they should first try to go it on their own.
Real estate is loaded with risks. Most folks sell their home for an average price, whether it’s listed with an agent or not. Actually, a recent study shows that most private sellers sell for a below average price — at least 6 percent below comparable represented properties.
Here are five reasons to hire an agent, according to www.KeepingCurrentMatters.com:
1. A good agent will help with all disclosures and paperwork key to completing the deal legally in today’s heavily regulated environment.
2. They offer education and experience throughout the entire sales process.
3. They act as a buffer between parties in negotiations and throughout the entire process.
4. They will help you understand today’s real estate values whether pricing your home or making an offer.
5. They explain what is going on in the real estate industry today and effectively explain it to you.
A professional agent is an advisor and a negotiator. He or she will have relationships with title professionals, lenders and other experts to help in the sale. Professionals provide marketing expertise and advice to help price the home right, commission it right and stage it right. Those are the three essential steps needed to take to get an above average price for your home.
Pricing it right is just one of the keys to getting the most showings and a faster sale. You want to price it so you don’t leave money on the table, while not pricing it so high you scare buyers and their agents away. Your agent will show you comparable listings to help you price it accordingly, and also factor in the perceived value that comes with proper staging. You can’t always go just by the numbers. Studies show that a professionally staged home can bring you 6 percent to 10 percent more in a sale.
Buyers pay more for a properly staged home, agents show it more and appraisers, from examples I’ve seen, often value it for more.
As for commission, I see a lot of agents cutting their commission and the commission they offer buyer agents. My coach advocates that commission isn’t an expense; it’s a marketing tool. When you cut the commission you are cutting one of the most powerful marketing tools in your agent’s quiver to get more showings and a higher price for your home. A higher commission often leads to more showings and higher and better offers. Homes with low commissions are often the last ones shown and possibly, not shown at all.
The No. 1 reason home sellers choose to go it alone is to save the commission. But do they, really? According to a recent study by Collateral Analytics Research, private sellers “tend to sell for lower prices than comparable home sales and in many cases below the average differential represented by the prevailing commission rate.”
The study showed that in 2016 private sellers sold at 5.5 percent below a similar property represented by an agent, while during the first half of 2017 they were down 6 percent below a represented property. The research showed that folks buying from a private seller are looking for a discount on the homes they purchase; the right agent knows how to help the seller resist lowball offers, properly stage a home or provide a professional stager; listed properties have a larger buying audience, which can result in a bidding war.
When agents are negotiating their commission with you, they are negotiating their own salary, which keeps the roof over their families’ heads and food on their table. If they can’t negotiate a proper commission for their work, how well are they going to negotiate the sale of your home? In short, how powerful of a negotiator are they if they cave to a lower commission?
You’ve heard it before, many times: you get what you pay for. Just like other good professionals, whether they are accountants or attorneys, the right agent will save you money…not cost you money.