“THE SELLER’S MARKET IS ON FIRE!” headlines boast. Real estate is recovering and the nation is overjoyed at the prospect of being a vibrant, healthy market again. In tandem, society is still licking many of its wounds this most recent recession inflicted. People are more frugal and try to make money stretch as far as it can go.
…This brings us to FSBO (For Sale By Owners).
MYTH: By selling your home yourself you can save a pile of money by not paying a commission.
The average real estate commission as paid by the seller (unless otherwise negotiated in the buy-sell) is 6% of a transaction. This is then split between the buyer’s agent and the listing agent. Running some numbers really quick, this breaks down into:
- · 96 Homes Sold in Bozeman in June (to date)
- · They Ranged in Sold Price from $131,500-$1,350,000.
- · 6% of the lowest price = $7,890
- · Seller’s Take Home = $123,610
- · 6% of the highest price = $81,000
- · Seller’s Take Home = $1,269,000
NAR Statistics did a study that found FSBOs sold for 81% of the value compared to homes being sold by an agent.
- · FSBO Seller’s Take Home or 81% of $131,500 = $106,515
- · FSBO Seller’s Take Home or 81% of -$1,350,000=$1,093,500
MYTH BUSTED: Using an agent to sell a home regardless if is it low end or high end statistically WILL SAVE A SELLER MONEY.
If you are not yet convinced, experts such as Burbidge list four main steps to selling your own house (SOURCE):
· Find out what your home’s value is and price it appropriately. Montana is a non-disclosure state so you cannot find out what your home’s value is without an agent. READ MORE HERE
· Prepare your house by making repairs, cleaning and painting.
· Market the house effectively. This can get costly quick but there are a few free resources a person can use including: Realbird.com or Craigslist.com (ß .org)
· Close the sale properly and legally. As soon as legal advice/counsel is sought, your pricing starts rising again.