Pros And Cons Of Selling Your House With An Agent
Selling a home can be an anxiety ridden and tedious process. What better way to alleviate some of the stress than selling with an agent right?
It’s true, selling a house with an agent can save a lot of headache and hassle, and a good one should be able to guide your through the process and handle a lot of the confusing and often lengthy paperwork that is involved.
Is it always the right decision though to hire an agent?
Maybe, maybe not. A lot of the time it’s very dependent on your situation. How could this be?
Let’s think about what the MLS (or multiple listing service) is for a second. The MLS is the resource agents use to market your home to all the other agents and brokers in your area. These other agents and brokers represent other buyers that are looking for a new home. The problem sometimes is that what if your home doesn’t necessarily fit the standard mold for a retail buyer? You do have other options.
Why Hire An Agent? The Advantages
Without a doubt the single biggest reason to hire an agent is their experience. Any agent that has been in the game for a bit and has done some business has probably represented numerous clients and bought and sold a handful of houses. This experience can be invaluable in helping you to sell your home to avoid many of the pitfalls and mistakes someone might encounter if they try to sell their house on their own.
2. Resource Of Buyers
Not all, but many agents will have buyers they are actively working with they may be looking to purchase a home like yours. Even if they don’t, most agents through networking, may know other agents within their office or through working relationships that may have a buyer that matches the criteria of your home. This may make it easier on you rather than trying to find buyers from scratch.
3. List Of Referals/Network
There are many hands and players in a real estate transaction, and trust us that isn’t always a good thing. You’ll encounter title companies, contractors, insurance companies, appraisers, mortgage lenders, and home inspectors if you decide to sell to a retail buyer. Having an agent that has worked with many of these professionals and has personal recommendations of their own can assist the ease of a real estate transaction.
4. An Easier Option vs. Selling On Your Own
Selling your home on your own is no easy task. Especially if you’re not well versed with the contracts, disclosures, and how to deal with all the 3rd parties. Then you have to worry about marketing, knowing how to price your home correctly, and inspection and appraisal problems. Working with an experienced agent is definitely an easier option that trying to tackle all this on your own.
5. Negotiation Skills
A good agent should have plenty of experience negotiating contracts and repair requests. This can save you thousands of dollars than trying to forgo it alone. Generally, an agent will have the knowledge an experience to know how to make a deal work, and their interests will be aligned with yours because the more money they get for you on the sale of your home, the more money they make.
All The Positives Come With A Price Right? The Disadvantages…
All sounds pretty good thus far right? Sounds like it would be a no brainer to hire an agent to sell your home but this isn’t always the case. There are definitely some pretty big disadvantages to working with an agent as well, and it’s up to you to decide which option may be better for your situation.
1. Paying Commissions
This is the big one right? For all you get with working with an agent the flip side of the coin is that it is expensive. Thousands of dollars expensive. Thousands of dollars that come right out of your equity in the home.
That is true, but generally their commission is based off of a percentage. So, a couple thousand dollars either way doesn’t affect what they put in their pocket that much. At the end of the day an agent gets paid at closing, so a few hundred bucks less to them in commission to get to the closing table may not align their interests fully with yours. A few thousand dollars to you however would be a big deal.
2. Handing Over Control Or Input
Is it simpler to just hand everything over to a professional and let them do their job? Yes of course it is. However, each agent may have their own opinions and ideas about how to sell your home, and you may not necessarily agree with it. Compromise will be key in this relationship, so you have to decide if that’s the path you want to take.
What happens if you hire a bad agent? Instead of your home selling quickly, it could take months longer than you anticipated, and could have possibly don’t better on your own.
3. Division Of Time
Most agents don’t work with just one client at a time. They probably couldn’t be in business if this was the case. So you will have to compete a bit for their time and attention. Being a busy agent can be a good sign, but it also means they’ll have less individual time to focus on your needs and questions.
4. Costs Are Higher
Besides the commission, in a standard retail sale you’re usually stuck paying for buyer requested repairs, credits, and traditional closing costs. These expenses are a huge variable and you really don’t know what you’re getting into until you’re under contract.
5. Human Error
Everyone makes mistakes, including agents. Whether they price a house wrong, perform bad market analysis or research, or give bad advice, it can greatly affect the outcome of selling your home. Working with a good agent can mitigate some of these risks, but are you 100% confident you’ll be able to pick the best of the best?
6. The Best Advocate For You Is Yourself
There are plenty of great agents that will find you a suitable buyer for your home. But at the end of the day only you truly have your best interests at heart. Even though they are working for you, as previously stated, an agent doesn’t get paid until you close. Interests may get mixed because of this, and you could end up selling your home for a lot less than if you had waited for a different offer or just accepted the first thing at the advice of your agent.
Should I List My House With A Real Estate Agent?
Selling with an agent does provide some amazing benefits. Is it always the right choice though? After weighing the pros and cons you may be leaning one way or the other. Take the time to do your research and explore all your options before you jump in and sign a contract.