What real use are real estate agents if we can sell our home ourselves?
In: Economics
Buying a home in another town? They provide a clear and valuable advantage. Especially if they get to know you and your family’s needs, preferences, hobbies, etc.
They can steer you towards the parts of town that are best suited for you and away from areas you may not enjoy. Personally, our agent understood the future city and commercial projects. She got us into an area that has grown into such a great part of town with new parks, restaurants, shops, etc.
We’d never had that “local” insider knowledge without her.
Real estate agents used to be important back before the internet. When they listed a home for sale it went in a book and cataloged. It was quite the process. But now with the internet it has made it easier for buyers and sellers to see what the market is doing. Until recently, at least in my area, realtors were the only ones with access to sale prices. So the homeowner couldn’t see what a house sold for to judge what they could get for their house, they only had the neighborhood gossip. The real estate board fought tooth and nail to keep that information secret but the government forced them to provide that information to the public. A good realtor now a days has photographers, YouTube, and social media marketing to reach as many people as possible to see your home and home stagers to make your home look top notch.You can totally sell your own home privately if you’d like but some of the top agents have a large swath of influence online and more people can see your home increasing the likelyhood that you’ll get a better offer on your property. As for the contract (agreement of purchase and sale) and negotiations, the realtor always pushes what you want. It takes the stress of negotiation directly with a buyer off your plate. So they do add value to selling your home. Now in my area commissions are 4-5% of the sale price. I just sold my house, used a realtor and had to pay 56k after tax for their services. In my opinion they get paid way too much. My house sold in 5 days. And we told her what to do.
Source: was a realtor for 10+ years.
In my recent personal experience, on the buying side though, my agent was invaluable in helping us understand the market, where to position ourselves during the offer, which things to concede during the offer that look good/are worthwhile to the seller but don’t impact us much. She was incredibly helpful for understanding the whole process.
I imagine on the selling side it’s a similar situation, how to position the listing, advise on quick cheap fixes to make it sell for more.
Also remember you will do this a few times in your life, they do it daily, find yourself a good agent and leverage them and their experience.
I’ve bought multiple houses WITHOUT using a realtor, and in all cases I got huge decreases in cost. Used a real estate lawyer, paid by the hour, to check over the paperwork. Organized and executed the inspections myself.
It’s not that hard at all. Real estate agents are vastly overpaid for basic home sale transactions, IMO.
Hence why companies like Redfin are doing extremely well nowadays.
Mostly depends on how well or how much you like negotiating. I have also used a great agent who was able to get creative with moving money around when the buyer suddenly got cold feet. The process itself isn’t terribly complicated, but in certain situations it helps.
I’ve also used an agent who was a complete waste of money, so just like any service, mileage will vary.
I’m in the US. I use them to buy but never used one to sell (I’ve sold 4 in the last 12 years). It’s easy to do your own comp analysis, and there are ways to pay a flat fee for an MLS listing. Last house I sold I did Facebook advertising. It’s never taken me more than a month to sell a house, even in a slow market. Fastest was one day (although negotiations took 3 more). If you can do it yourself, why lose that extra %?
I don’t believe they are that useful. Buying home involves big money, so industries have been created off of injecting them selves into the transaction and taking single digit percentage of the cost. Which adds up when your talking $100k + deals. There’s agents on both sides, home inspector, underwriter, lender, title insurance, lawyers, and appraiser. Out of all of those people, the agent is the least qualified to do anything with the purchase or sale of a home. They will say, “how will you market your home then”. With all the home selling sites now. It’s as simple as posting it on zillow or some other site. Every time we bought a house we searched these sites and then sent them to our realtor. She rarely had anything above and beyond what these sites offered.
That being said, I believe there are some smart people that know the game and can help get you the best deal out of the transaction, but most of them probably are not worth 10k on a single deal.
But then again, if you don’t want to apply any effort then pay them to do it.
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What’s the value of a good salesperson? A realtor charges about 6% of the value of your home. When you use a realtor, you are betting that they will find and convince a buyer to pay at least 6% more than what you could get on your own. I don’t have that kind of market knowledge or sales skill, so I think that’s a safe bet.
Another historical factor, in the US, is that the National Association of Realtors controls the Multiple Listing Service, which for decades was the only national database of home sales. If you wanted buyers from outside your neighborhood to see your house, or see what similar homes sold for, MLS was your only option, which meant you had no choice but to use a realtor. This has changed recently thanks to sites like Zillow, but the MLS is still a very valuable tool that’s worth paying a realtor for.
They have more exposure/potential buyers, than you would on your own
They also try to sell the house actively to the potential costumers and help you with various paper works and such
Aome people do sell their houses without one though. Saves a pretty penny in many cases
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