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Ann Downing
Your Realtor, Master of Home Sales

Use a Realtor or go "For Sale By Owner"?

Hire a Professional Real Estate Agent

A qualified, competent real estate agent will help you navigate the myriad of decisions that arise when buying and selling a home. An agent provides value to the homeowner in many ways:

  • Pays for all marketing and advertising costs.
  • Adds experience and expertise in all aspects of the sales process including marketing, financing, negotiations and more.
  • Handles all showings.
  • Brings a network of known, trusted real estate professionals. If your agent doesn't have the answer, he or she likely knows someone who does.
  • Always has your interests in mind so you always have someone on your side.
  • Can handle and advise on all price and contract negotiations.
  • Provides you with all the possible options and opportunities without holding back.
  • Gives an unbiased, realistic view of your home and your options. Unlike buyers and sellers, an agent has no emotional attachment to property.
  • Has the knowledge to help you ask the right questions.
  • Being a third party, potential buyers are more likely to tell your agent the truth about your home, even if it is unflattering. This objective viewpoint will help you make the necessary changes to get your home sold.
  • Your time is valuable. A real estate agent allows you to spend your time how you want.

Consider these points when deciding whether or not to work with REALTORs® to sell your home.

 With a REALTOR® Listing Agent

Great REALTORs® give you all of the available information and applicable facts about the current real estate market in order to help you make the best selling decision. They educate and guide you towards to the right decisions; they never tell you what to do. Realtors are bound to do so by The Realtor Code of Ethics.

The term REALTOR® is an earned designation given to members of real-estate firms affiliated with the National Association of REALTOR®’s (NAR). REALTOR®’s are trained and licensed to assist clients in buying and selling real estate.

Why Use a REALTOR®?

NAR Article

Selling a home is a complex process involving what’s likely to be your most prized financial asset. Enacting a smooth transaction for your home’s full value requires the expertise of a REALTOR® . A Realtor’s extensive training has prepared them to generate the best possible results on your behalf. Much like you wouldn’t treat a broken leg without a doctor or handle a major legal dispute without an attorney, it’s unwise to buy or sell a home without the professional assistance of a REALTOR®.

Naturally, every seller wants to reap the highest return from a home sale. That makes it tempting to try selling the home on your own, thereby saving a REALTORs® fees.

But consider this relevant research... a study conducted by the National Association of REALTORs® (NAR) found that 82 percent of real-estate sales result from REALTORs’ contacts with previous clients, referrals and other sources. Additionally, NAR concluded that most homes sell for 3 percent to 9.5 percent more when sold through a REALTOR®.

Selling your home through a Realtor can yield abundant advantages. To highlight a few:

  • REALTOR®’s have access to Multiple Listing Services (MLS) they use to provide information about your property to thousands of consumers through their REALTOR®’s. REALTOR®’s have other marketing vehicles, such as open houses and referral networks, at their disposal. Through your REALTOR®’s marketing efforts, a much broader range of qualified buyers will be informed that your property is available. Most Realtors also use web advertising to also help sell your house.
  • As a seasoned pro at negotiation skills and tactics, a Realtor can maintain objectivity in assessing buyer’s proposals and developing offers and counter-offers. Throughout the transaction, including appraisals, inspections and legally binding agreements, you can depend on a Realtor’s know-how to avoid potential pitfalls.
  • Sales transactions include intricate legal and regulatory requirements. As a trained and licensed REALTOR®, they are familiar with the regulations. They can help you understand and adhere to them.
  • REALTORs work with their clients to address home improvements and tips that will enhance your home’s salability.
  • REALTORs® offer you the benefit of their extensive, professional sales training.

When you sign with a REALTOR®, you are under contract, which is legally binding giving the agent the exclusive right to sell your property within a certain period of time.

    1. The agent does market research and helps you to determine the best value of your home in the current market.
    2. The agent markets your property, will advertise your property, and schedule and conduct showings of your property.
  1. An agent will make suggestions and help you determine what must be done to your home in order to receive the best value from the sale.
  2. The agent acts on your behalf during the transaction process, completes and files the proper paperwork, and will negotiate your terms to the buyers.
  3. The listing agent receives payment for their services in either a percentage or a flat rate.

CNN Article:

The "For Sale By Owner" route ("FSBO" in advertising lingo) is taken by plenty of home sellers these days. According to a survey by the National Association of Realtors, 13 percent of all homes were sold directly by their owners in 2001. The survey doesn't tell us, however, if those sellers were glad they did it.

For some insight into that, CNN asked community members about their experiences in selling their homes themselves, and if they'd do it again. Here's a bit of what CNN heard:

Absolutely. "I sold my home myself and would do it again in a heartbeat! I spent $3 on two "For Sale" signs and because I set the asking price in the same range as similar houses being sold, I got to keep the equivalent of the real estate agent fees (4 to 6 percent of sale price) for myself." --Tony in Conn.

It depends. "I know from lots of personal experience that a slow housing market almost 100 percent requires a real estate agent, and even in some very strong markets it is very helpful to have one." --Will

No way. "We tried selling our home ourselves a year ago in order to save money. We experienced three months of people never showing up for an appointment, showing up early and showing up late. For us, it was a pain -- missed meals, changed plans, etc. We finally listed with an agent and it sold in 10 days." --Dave

Is FSBO right for you? It depends. What's the market like in your area? How quickly do you have to sell? Do you have the time and temperament to deal with hordes of prospective buyers tramping through your house? Balance all this out against the amount you would save by not paying a commission to an agent and you should have your answer.

Whether or not you choose go it alone, use my checklist of the key things you can do to make selling your home as profitable (and painless) as possible.


The checklist for selling your home

Make it shine. Look at your house through the eyes of prospective buyers. Toss the junk, clear the clutter and make it sparkling clean. Make minor repairs so that your buyer's home inspection comes clean, but stay away from capital investments at this time, which you are unlikely to fully recoup when you sell. Your money is much better spent making cosmetic improvements.

Get real about the price. What you paid for the house or what need to make on the sale isn't relevant. The only thing that really matters is what buyers are willing to pay. To get a realistic idea of how you should price your house, look at what similar homes in your area are actually selling for, not the price they are listed for. You should also consider getting it appraised. If you do use an agent, he or she will be able to provide a fair price range.

Pick the best offer. If you receive multiple offers, evaluate each on price, how prepared they are to finance the purchase, the terms offered and the type and number of contingencies placed on the offer. Remember that the offer with the highest price is not necessarily the best one.

Get legal help. Real estate transactions are complex affairs. A few hundred dollars spent on having a lawyer review your listing agreement, contract and closing documents can be money extremely well spent, ensuring that there are no surprises and you're getting a square deal. Choose one who specializes in real estate sales.


For most of us, our homes are the biggest investment of our lives. So when it comes to selling, be sure to either get professional help or to put a great deal of your own time and effort into ensuring that you get the best possible price and terms.

2006 Market:

With interest rates on the rise and uncertainty in the air, it is a buyers’ market. Sellers are having a tough time and houses are sitting on the for sale market for long periods of time. Get a REALTOR® to help you negotiate the best price for your home and ensure the paperwork is done correctly. Realtors charge a commission for selling your house, usually 6-8%, with half the commission going to the buyers’ Realtor.

You can negotiate commissions down to a lower amount, like 4.5% but realize that less commission goes to the buyers’ agent, and then wonder if agents will show a home where they get low commission (legally they should show all homes). If a Realtor offers a low commission, ask what are they are going to do for you- it may not be much. Also if it is a buyers’ market, remember your commission needs to be competitive, offering 3% each to the buyer’s agent and listing agent is the average commission.


You Do Not Want To Sell Your Own Home

Selling your home by yourself brings about a lot of liability issues that you may not be aware of.
You are legally in charge of the transaction. Make sure you understand and follow the rules and regulations regarding the sale of your property.

  1. You need to research and determine the value of your property.
  2. You need to market and learn how to present your property.
  3. You will typically pay for the buyer’s agent’s services. You may also need to pay for additional services that you require during the transaction.

If you have decided to be a for sale by owner seller, so you've done your market analysis and you've determined a good asking price for the house. You've worked on your curb appeal, spiffed up the home and handled minor repairs. So now you're ready to let buyers take a look... or are you?

There are a few more things you should handle before you run your first for sale by owner ad.

Property Disclosures

Does your state law require that you give potential buyers all needed property disclosures when you sell a home? Disclosures typically deal with the condition of the property or facts about its location, such as:

  • The age of the home and its components
  • Whether problems exist with any component
  • Whether you (or a neighbor) have built something (fence, shed, road, pool) that extends past property boundaries
  • If the house is in an airport flight path
  • If the house is in a flood zone
  • If the house is on earthquake fault
  • Other issues important to your specific location

Don't assume that disclosures are only necessary for homes listed with real estate agents, because most for sale by owner sellers must furnish them, too.


Lead Paint Disclosures

If your house was built prior to 1978, federal law requires that you disclose that the home could contain lead based paint and give buyers details about past tests for lead paints. You must also offer buyers the opportunity to do their own lead paint testing. You must also give your buyers a lead paint pamphlet, which is available free online from the EPA.

Fair Housing Laws

Individual sellers aren't subject to as many fair housing guidelines as real estate agents are, but it's smart to follow fair housing laws, just to make sure you don't encounter legal problems later.

Pre-Qualifying Home Buyers

A good real estate agent verifies a buyer's pre-approval status before he shows them property. When you sell by owner you'll deal with many people, including those who are qualified to buy a home and those who don't have a chance of getting a home financed.

People who know they cannot buy sometimes think that for sale by owner homes offer a better opportunity, because they're hoping to find a seller who will finance the transaction.


Ask these questions to get a better feel for someone's buying power:

  1. Have you been pre-approved by a lender for an amount in this price range?
  2. Can you buy a house now, or do you have to sell your current home first?

It's a good idea to require home buyers to submit written proof of pre-approval with any offer. If your buyer can't buy until he sells, you'll have to decide whether or not you want to wait for that to happen. If you do decide to wait, be sure to insert a kick out clause in your contract with the buyer.

Contract Forms

Who will provide the contract forms that will be used for an offer to purchase your house, you or the buyer? You can write a contract yourself on a piece of paper, but it wouldn't offer much protection for either of you. The forms you use should be written specifically for your state's real estate laws and cover all issues that are important for your location.

If you aren't contract savvy, have a real estate attorney review any offer before you sign it. Don't cut corners here, neglecting to get advice from an attorney or other knowledgeable person will cost you money, not save it. You are legally liable that the forms are correct, accurate and complete.

The Buyer's Deposit

The contract should spell out what happens to the buyer's deposit money, called earnest money if the deal falls through:

  • Under what conditions would the buyer get it back? (unable to get financing, too many repair issues, etc.)
  • Under what conditions would you expect to keep it? (buyer backs out with no cause)

The deposit money is not yours until the house sells or the buyer breaks the contract in such a way that it becomes yours by prior agreement. It must be credited to the buyer's funds on closing day and ideally should be held in someone's trust account until then.

Real estate laws and customs differ in nearly every state in the US, so it's essential that you do some research on a state and local level to be sure you are complying with all laws associated with the sale of your home.




Century 21 and Ann Downing are not liable for information provided above. Consult a lawyer for advice. Do your research and due diligence.  We think you would be happier if you used a Realtor.