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ready to sell your own home but can't find a good agent thinking about selling your home yourself are you stuck between whether or not you should hire a real estate agent or sell your home yourself this video will break down the pros and cons of going the for sale by owner route versus the traditional route of hiring a real estate agent to sell your house prepare for the most biased video you'll ever see in your life and also most hypocritical i sell my own houses but also i'm a real estate agent so that makes me a double agent i'm on both sides of this argument selling your house is a big deal and obviously it can come with some big costs as well so obviously you want to do it right average fees you'll pay in canada to a realtor for selling your house around four and a half to five percent whereas in the us based on my research some places get as high as six to eight percent that sounds very high for the us i mean maybe if you're thinking about as a percentage of a house maybe it's two hundred thousand dollars so the percentage is high of 200 but the dollar amount is not that high regardless selling your house yourself can save you some fees but what are the upsides what are the downsides let me go through some factors some talking points and go through the pros and cons of each first item price the pros of fsbo for sale by owner you're selling your own house to save on the biggest expense the commissions and by doing so you'll have more cash in your pocket after the sale is completed if you're selling your house for seven hundred thousand dollars at the canadian average commissions of five percent that's 35 000 plus tax savings cons of fsbo for sale by owner once all is said and done there might not be that much of a price or money benefit as you first might imagine according to a 2018 study obviously by the realtor association so here's the bias homes sold using a realtor averaged 280 000 in the us compared to 200 000 for homes being sold by owners going back even further 2008 not sure if this is relevant anymore but the average realtor sold house was 211 000 compared to 153 000 for a for sale by owner maybe it's easier to sell a cheaper house so you can sell it on your own maybe cheaper house means cheaper people i'm not sure but those are the numbers another downside affecting price is you're a target for bargain hunters someone is searching on a for sale by owner website because they're looking for a deal looking for a bargain they know you're saving on commissions and they want part of that savings as well why would someone buy a house being sold by an owner for the same price as one being sold by the realtor you're paying the same price they're getting all the benefit while you're getting none i think it's a common misconception that you the seller gets to keep all the savings these savings might not be as much as you thought many for sale by owner websites recommend that the seller at least offer to pay for the buyer's realtor so that's 2.5 but it's obviously to attract some more buyers why would a realtor try to get a client to buy your house if they're making zero dollars on it again it is their livelihood it is their business in fact if you think about it they're actually losing money on the whole process due to time spent so if you think you're pocketing the whole five percent by selling your own house that's probably not likely you should offer at least 2.5 to try to get more people to see your unit my initial example of selling your house for seven hundred thousand dollars now your savings instead of five percent is two and a half your savings are now seventeen thousand dollars five hundred and that's not factoring in photos staging or marketing so all of a sudden you're seventeen thousand five hundred might slowly go down to ten thousand might slowly go down to five thousand now let's discuss the second factor the pros and cons of time the pros of selling your own home in terms of time i'm struggling to find one of the pros in in this case the one saving grace i could think of in this scenario is if you've had a realtor before that is super busy has a lot of clients and has no time for you doesn't answer your phone calls basically has no time to put into your sale i think it's safe to say there are no pros when it comes to time other than that example when it comes to selling your own home when you're selling your own home you're doing all the work you're listing the unit you're doing all the paperwork you're booking the appointments you're staging the unit you're doing the photos you're marketing the unit and you're also dealing with people's phone calls and potential time wasters you'll always need to be available to answer phone calls for someone to book an appointment there's no one else to call they have to call you and you always have to be available to show them your house never let a buyer in a loan without an agent or without yourself you have to be there someone has to be there now let's talk about the cons in terms of time this is basically every i'm just going to be repeating everything i just said in the point above when you're going the fsbo route in terms of time there are only cons this is why you hire a realtor the realtor will find a stager get a quote set a date and do the staging for you the realtor can hire cleaners can hire photographer set the date remove all the clutter and get the pictures ready for you if you're selling your own home and a buyer wants to see the unit let's say you're working nine to five at an office you'll have to take time off of work to show them that your unit this is the realtor's job this is why you hire a realtor you'll have to you'll be able to stay at work while the realtor will be showing your unit if you're selling your own house and you want to set up an open house will you buy signs and place them everywhere that's money and time coming out of your pocket and out of your day will you make brochures would you set up the marketing again this is why you hire a realtor they already have the science they already have the team set up to do the brochures and the print media for you the realtor will also deal with all the time wasters many people who inquire about a property are not interested in the end and that's fine but if you were to answer all the phone calls imagine how much time you're wasting but the realtor will filter all of that for you third item let's talk about the pros and cons in terms of marketing one of the most important things in terms of selling a house is the marketing the more people see it the higher chance you have of selling at a great price pros there are many new websites coming dedicated solely to for sale by owner houses getting your house listed online is becoming relatively easy and relatively cheaper every year you can also purchase your own ads put your own ads in newspapers or in magazines but let's be real nobody uses those anymore ninety percent of buyers look for their houses online if you're artsy you can design your own listing package and create your own brochures also you can take your own pictures saving money and time everywhere by not hiring professionals cons one of the biggest cons in terms of marketing for for sale by owner is not getting it listed on mls the majority of buyers and sellers will be listing all their units on mls obviously you can list on one of the aforementioned fsbo websites but those don't get nearly as much traffic you want access to a wide network and that's where a realtor comes in a realtor has a dedicated network to buying and selling houses their closest network is their current clients they might have other buyers ready to buy your exact house a wider network is their brokerage they can advertise your unit to everyone in their brokerage and another sales person might have a buyer ready for your exact unit lastly their widest network would be their social media account i've seen some realtors with their social media like let's say instagram advertising account with over 20 000 followers these are all factors you're missing when you go the fsbo route fourth item let's discuss the pros and cons in terms of negotiation the pro of selling your own home in terms of negotiation you're not subject to any pressure by a realtor by someone else to try to get you to accept any offer any low ball just to get you to sell the unit so they can make a quick sale you have the power to negotiate your own terms your own price whether it's correct or not you're in control you're in the power seat you're not subject to someone who doesn't value your time or who wants to do a quick flip a bad realtor you know it happens might pressure you into a quick sale or to accept the first offer that comes by they'll say that you won't get another better offer except this lowball but it's obviously not for you it's for them to be done with this deal and on to the next one cons you might have zero negotiation skills if you've been selling your house your whole life how many would you have done three to four negotiations over a lifetime whereas a realtor might do three to four successful a month but three to four unsuccessful a week so they have much more experience in terms of negotiation this skill definitely comes in handy not knowing how to negotiate can put you at a very serious position of being taken advantage of there's a higher chance you might be bullied by another buyer or another realtor if you're selling on your own last item let's discuss the legal factor selling a house is a legal transaction there are rules you can't make up the rules yourself always be informed use the correct forms make sure you read the laws related to your current province or state about what the rules are and how to actually go about selling your own house with that being said let's get into the pros when it comes to the legal factor this is another one where i don't see a particular pro i don't see a distinct advantage that you have in terms of the legal factor when selling your own house unless you're a realtor or a lawyer maybe you have a good real estate lawyer that can walk you through the whole process i'm not really sure cons i can find a lot of cons from selling your own home you need to find out what's required as a seller you might not know all the paperwork that's required you might not know that your basement apartment is actually illegal you might not know that you have to disclose that you had a leak in your basement how bad the leak was or how bad the leak in your swimming pool was did you know that you're required to disclose any negative stigmas to any potential buyers a lot of people don't if you're i guess in canada if your house has been a grow up or if there's been a murder in your house any negative stigma you have to disclose this without knowing the law or selling many houses a seller going the fsbo route might be inadvertently opening them opening themselves up to potential lawsuits many owners think you can simply sell your home as is and not disclose any potential issues those are the five items i wanted to discuss the pros and cons for and you can make your own decision but obviously more and more people are interested in the fsbo route and in order for them to be successful i'm going to list the top reasons why fsbo fails so hopefully you can mitigate it or plan for it before you even begin the list price was too high therefore nobody came to see the unit or even offered this is one downside of selling your own house your little bias everyone thinks their house is the nicest on the block it wasn't properly staged buyers weren't able to see the unit at their convenience not offering a commission to a buyer's agent therefore not as getting not getting as many people to come see your unit not knowing how to negotiate sometimes this means sellers not negotiating at all and setting a hard price lastly not marketing the unit nobody knew the unit was for sale that's all for today i'd love to answer any questions for anyone looking to sell their own house obviously it's not easy but it can be done and if you're in the states and you can save six to eight percent why not at least try please check out my past videos on the canadian housing market and first time home buyers guide as well as check out my upcoming videos on stocks investing finance and maybe some more real estate thanks guys you
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