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When it comes to selling your home, you have a couple options. You can go the traditional route and hire an experienced real estate agent to help you through the process. Or, you can try to sell your home on your own (AKA For Sale by Owner, or FSBO).
There are pros and cons to both options, and the best choice for you will ultimately depend on your unique circumstances. In this two part series we’ll look at some of the key considerations to help you decide whether hiring an agent or going FSBO is right for you. In part one we’ll consider the pros and cons of hiring an agent. Then in part two we’ll consider the pros and cons of selling your home without an agent (FSBO). The goal is to equip you with valuable information so you can make an informed decision on what is best for you.
The Pros of Hiring an Agent
1. You’ll benefit from professional experience and expertise
If you’re not familiar with the ins and outs of selling a home, working with an experienced agent can be a huge help. They will know the best strategies for marketing your home, negotiating with buyers, and getting the best price possible. Within my own team, we utilize a comprehensive system that covers 200 unique A-Z variables from market analysis, planning, home prep, listing, marketing, negotiation, closing, and everything in between. At a high level some people weigh the pros and cons of hiring an agent as a measure of added commission cost versus additional sales profit. In principal, this makes sense. However, it can be easy for a home seller to assume that they will get equal results just listing a home by themselves. In reality, even in a hot market, seller's that list on their own are usually at a high risk of leaving a lot of money on the table. So much that they will often net less profit on the sale of their home than if they had listed with an agent (even after the cost of commission). This is because, effective home selling requires a number of specialized activities including: planning, marketing, negotiation, and coordinating logistics in order to get the best possible result. Therefore, unless a seller has a thorough understanding of the planning, marketing, strategy, negotiation, and logistics that goes into selling their home, it's typically wise to leave this to the professionals.
2. They will handle all the paperwork
There’s a lot of paperwork involved in selling a home, from the initial listing agreement to the closing documents. An experienced agent will handle all of this for you, so you don’t have to worry about it. More importantly, they will guide you through the disclosure, negotiation, and contracting process. This will help to ensure you fully understand an offer prior to accepting it, and protect you from an offer that puts you at a significant disadvantage. The guidance of a good agent will also help to ensure you are fulfilling your obligations to the seller so you aren't at risk of legal action down the road. Although an agent can't give you legal advice, a good agent will guide you through the right process of entering a contract to sell your home. They will also be able to help you identify risks and red flags that should be escalated to a lawyer for legal advice.
3. You will save time
Selling a home can be a time-consuming process, especially if you’re trying to do it on your own. An experienced agent will be able to take care of organizing the many details for you, so you can focus on your day-to-day life. If you have a career, family, social engagements, and other commitments to attend to, you may not want to take on selling your own home on top of that. Especially since selling a home can be an all consuming process if you don't have the right experience and systems in place to handle all the details. A good agent will have a proven repeatable system they have built up over time which allows them to get you the most for your home in any market.
4. You’ll have peace of mind knowing that everything is being handled professionally
When you work with an experienced agent, you can rest assured that everything will be handled in a professional manner. They will take care of all the details, so you don’t have to worry about anything. Selling your home is stressful, especially if it's linked to additional plans (i.e. buying a new home, moving to another province, etc.). If you don't have experience selling real estate, and you've never sold a home by yourself before, then trying to take on a project like this by yourself can introduce a lot of unnecessary legal risk. Having the support and guidance of a knowledgeable realtor changes this equation by introducing a professional who can give you oversight and guidance throughout the process.
The Cons of Hiring an Agent
1. You’ll have to pay a commission
If you hire an agent to sell your home, you will be responsible for paying their commission. This is typically a percentage of the final sale price, so it can add up to a significant amount of money. Although the added experience and support provided by a realtor will typically make you more money than it will cost you in commission that may not always be the case. For example, if you understand the local market, know how to make your home presentable, and are fairly knowleadgable about sales and marketing, then you might be able to achieve similar results without having to pay commission. In this case, you'll just want to make sure you're comfortable with taking on the risk and potential liability of representing yourself in selling your home.
2. Hiring an agent doesn't guarantee you'll get full market price
An experienced agent will likely be able to sell your home for more than you could on your own, but you still may not get the full market value. This is because they will be taking a percentage of the sale price as their commission. Aside from this added cost, there's also the risk that using an agent won't get you more for your home. Although in most cases a skilled agent can help you make more overall, even after commission is paid, this is not guaranteed. In the worst case scenario, an inexperienced or unprofessional agent might get you the same or less for your home and you will still have to pay their commission.
3. You could end up in a bad situation if you choose the wrong agent.
If you hire an inexperienced or unprofessional agent, it could end up costing you a lot of money. They may not be able to sell your home for as much as it’s worth, or they could make mistakes that create legal liability or end up costing you money. This is where choosing the right agent is so important. Even an experienced agent can put you in a serious bind if they take on too many clients, aren't paying attention, or give you bad advice. Working with a good agent can help you safely navigate the home selling process in a way that makes you more money. Working with a bad agent can lead to wasted time, wasted money, and greater risk.
So there you have it. Working with an agent has a variety of pros and cons that are each worth careful consideration. On the plus side, a good agent can earn you more money for the sale of your house. They can help you handle the paper work, save you time, and give you guidance and peace of mind throughout the entire process. Best of all, their professional experience and expertise can help to ensure your interests are protected. However, on the other hand, hiring an agent guarantees that you're going to have to pay commission which can get really expensive. What's more there's no guarantee that you'll get full market price if you list with an agent, and the wrong agent can cause serious harm. Ultimately, the pros and cons of hiring an agent usually come down to the quality of the agent. Stay tuned for part 2 where we discuss the pros and cons of For Sale by Owner (FSBO).
I am a Victoria based local realtor with eXp Realty. My commitment to honesty, integrity, loyalty and hard work have been important pillars for me because they drive a high standard of excellent service for my clients. Helping you realize your dream is my goal!
I service Vancouver Island, but my focus is on: Victoria, Sooke, Saanich, Malahat, Shawnigan Lake, Cobble Hill, Duncan, and the rest of the Cowichan Valley.
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