Selling FSBO vs Using an Agent

Most homeowners who try to sell their house “For Sale By Owner” (FSBO) do it to save money. Understandable. If you can net more money by selling your own house, why not give it a shot?

Many who attempt sell on their own go into it with a few assumptions. One, that it will be easy for them to sell their house. And two, that they’ll be able to sell it for just as much as an agent would – or even if they don’t sell it for quite as much as it would have sold for if listed by an agent, they’ll still come out ahead by saving money on commissions.

The problem is, it’s difficult to prove these assumptions as true or false until you get out there and actually try to sell your own house. Before jumping right in, it may be helpful to learn from what other people have found after selling their own homes. Let’s take a look at what some recent FSBO sellers had to say about their experience…

Four Major FSBO Regrets

According to a recent survey of 1,000 people who sold a home in 2022 and 2023, many owners who tried to sell their own homes had some regrets about not hiring an agent: ¹

1. They made less money.

On average, homeowners who hired an agent made $46,603 more profit than those who sold on their own. Many of the FSBO owners surveyed felt like they lost money or regretted not negotiating more, and nearly half (48%) say they now believe their home would have sold for more if they would have used an agent.

2. It took them longer to sell their house.

Over half (53%) of sellers who hired an agent accepted an offer within one month of listing, versus 39% of those who sold on their own. Ultimately, almost half of the sellers surveyed (46%) believe that their home would have sold faster if they hired an agent, which is interesting since many assumed selling on their own would result in a quicker sale.

3. More stress.

Many reported that the process was more difficult than expected. More than half of the sellers surveyed felt overwhelmed by the entire process and admitted to crying at some point during the process as opposed to the homeowners who hired an agent. Those who worked with an agent were more likely to say they felt good about their sale and experienced less stress.

4. Legal mistakes.

40% of FSBO sellers said they didn’t understand the contracts and paperwork involved, and 36% said they made legal mistakes. In line with this, 43% said buyers didn’t trust them because they didn’t have an agent.

While it might seem attractive for a homeowner to try selling FSBO in order to save money on agent commissions, it is important to note that many have found it actually may end up costing more in the end, not to mention the added time, stress, and potential legal issues that can arise.

Seven Ways Agents Can Help

Here are 7 good reasons to hire an agent you trust:

1. Education and experience.

Most people sell only a few homes in a lifetime, usually with at least a few years in between each sale. Even if you’ve done it before, laws and regulations change. As a requirement to keep an active real estate license, agents must meet continuing education requirements as defined by their state. Good agents have the experience, knowledge, and track record to market and sell your house quickly and at market value.

2. Market Conditions and Price Guidance.

There are a lot of factors that agents take into consideration when recommending a listing price for any property. Agents have access to detailed comparable sales they use to identify a reasonable recommended price range. Particulars of the home such as the condition of the property, upgrades, renovations, issues or needed repairs are also taken into account, along with current buyer trends, interest rates, and other economic factors. The seller’s goals and timelines are also important; good agents will use all of this information to fine tune the recommended listing price and devise a listing strategy for you.

3. Property Marketing Power.

Today’s buyers use the internet to search for homes, and the majority use a mobile phone or tablet for their search. Professional photos, detailed descriptive information, floor plans, and virtual tours are the things buyers value most when searching for homes online. Good agents will be able to not only list your property in the MLS, but also share your listing information across hundreds of home websites and platforms for maximum exposure.

4. Your Time and Security.

While a property is on the market agents field the calls, texts, emails, questions, and verify buyers are pre-qualified for a loan amount sufficient to cover the cost of your property, so you don’t waste time preparing for showings that have no possibility of resulting in an offer. Good agents will follow up after all showings to get the honest feedback buyers may not be comfortable giving sellers in person. And remember, homes listed with agents are more likely to be under contract sooner than homes listed as FSBO that don’t already have a buyer in line. ²

5. More Negotiating Power.

There are many things that must take place during the transaction to get from the point of an accepted offer all the way to closing. Good agents will help you navigate the contingencies involved with financing, inspections, appraisals, and unforeseen circumstances. What happens if you have multiple offers? Is the highest offer always the best? Where might there be room to negotiate? It’s nice to have an expert by your side to help sort through the details.

6. The Paperwork.

If you’ve ever gone through the process of buying or selling a home, you know there is a ton of paperwork that can often get confusing. Good agents make certain important documents are not overlooked, so you can feel confident throughout the process: from gathering all relevant listing details, to correctly filling out all mandatory federal, state, and local disclosures, to reviewing and explaining all offers, to crafting counteroffers, to filling out escrow instructions, and reviewing the title work and closing documents – it’s a huge benefit having an expert by your side to handle the paperwork and answer questions.

7. REALTOR® Representation.

Do you know what the difference is between a real estate agent and a REALTOR®? Real estate agents are licensed to help clients buy and sell real estate. Realtors® are real estate agents who are also members of the National Association of REALTORS® (NAR). Membership with NAR requires adherence to a strict code of ethics. To sum it up, agents who are Realtors® have a legal and ethical responsibility to represent their clients’ best interests at all times. This means that while buyer agents have a loyalty to their buyers, listing agents have a loyalty to their sellers, and a duty to always promote what is best for the seller, such as disclosing to you any known material facts, maintaining your confidential information, and accounting for any money handled in the transaction. Realtors® have your back!

Key Takeaways:

While it might seem attractive to save money on commissions by selling your home FSBO, keep in mind it may not be as easy as it sounds. Concerns about netting the most money and getting the best deal along with the amount of time, effort and stress involved with the process of listing without an agent are common themes among homeowners who have recently sold FSBO. Good agents can bring a lot of value to the transaction, and are always willing to have a conversation. Do your homework before jumping in! Thanks for reading and for keeping it real with me.

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