My friend says we should sell our home ourselves and save the commission. Is that a good idea? Will we save a lot of money?
We all know that real estate sales professionals are generally compensated through fees generated from the sale of real estate. They are being compensated for their knowledge, expertise, experience, and hard work. The market recognizes the value they bring to the process. On the listing side they know how to price and best market your home. In helping a buyer, they know where to look, what to look for, what questions to ask, what the values are; essentially bringing their market knowledge to the table.
In the case of a FSBO, a solo buyer knows you are not paying any fees. This type of buyer is often a knowledgeable "bottom feeder." The first thing such a buyer will do is to discount the offer to reflect that you're not paying fees. In this case you won't save any money. Since there are so few solo buyers, trying to save on costs may cost you much more.
Real estate brokers may shy away from showing your home to their buyers because they might be concerned that they won't be compensated for their services. Or, they may come to you ahead of time and secure a commission agreement with you for their buyer. In this case you won't save money.
Real estate brokers may shy away from showing your home because they are concerned that your lack of expertise may complicate the transaction. In this case you won't have a sale.
A real estate broker may shy away from showing your home because he believes you're overpriced and inflexible. In this case you won't have a sale.
Often, you'll see For Sale by Owner signs out there for months and months. During this time, mortgage payments pile up, which in effect lowers the net proceeds from sale.