Do Real Estate Agents Save Sellers Money?
Everyone wants to save money, which makes it easy to understand why someone would want to sell their home without the help of a Realtor. The other day, while talking with a frustrated for sale by owner in Cary, NC they wanted to know how much I would charge to sell their home.
That's when I realized most For Sale By Owner's are only interested in saving as much money as they possibly can, it's our job to help them connect the dots to what they walk away with. Instead of telling him how much money I would charge to sell his house, I asked, "would you mind if I showed you how much money you will save working with me?"
Sellers are far more worried about protecting their equity, and rightfully so! You spend years building equity in your house you don't want to just give it away. However, when you are selling your house it needs to be treated as strictly an investment.
"In 2013 90% of home sales were with a Real Estate Agent. Working with a Real Estate Agent helped seller’s return an average profit of $46,000 more than a home sold by owner. FSBOs accounted for 9% of home sales in 2013. The typical FSBO home sold for $184,000 compared to $230,000 for agent-assisted home sales.” - 2014 NAR Report Profile of Home Buyers and Sellers.
It’s easy to understand why someone would want to sell for sale by owner, they want to save money. Who doesn’t want to save money?
Here are 5 ways in which Real Estate Agents Help Sellers Save!
Determining the Best Possible List Price
Pricing your home accurately is how you get it sold fast and for the most money. It’s typical a home that is seen as a good deal will attract multiple offers in a short amount of time. The top 3 things that sell a home are location, condition and price.
One of the fastest ways to devalue your house is overpricing it. Don't fall for the typical price per square foot is the exact price my home should be, it's not a good way to measure the value of a home and here's why.
When your home sits it’s seen as undesirable for a number of reasons. Typically buyers will rule out homes that have been on the market for a certain number of days which means yours is no longer an option for a percentage of the buyer pool you were marketing it to.
When you work with a Real Estate Agent they will help set a proper list price, as well as proper expectations of what ‘should happen’ before the home is listed for sale. An expert agent will know we should receive ‘x’ amount of showings or close to it in this timeframe, if we don’t we need to re-evaluate.
Keep in mind you'll need to understand your local real estate trends as well when determining an accurate price. The homes for sale in Raleigh, NC are appreciating almost twice as fast as their historic average.
This could mean lowering the price, as a certain percentage of homes in this area are typically sold within ‘x’ timeframe and if they ‘y’ number of days on market there is a ‘z’ percentage they end up never selling.
This data and analytics is available to Real Estate Agents who can ensure your home will sell for top dollar in the fastest amount of time.
Improving your Home’s Condition will Improve your Price
One of the ways in which Real Estate Agents are able to help sellers make higher profits on the sale of their home is with home improvements that increase sales price.
Home improvements are an investment for which you should be able to see at least 2x the amount put in. This means that if you pay a landscaper $1,000 to improve your curb appeal, you should be able to net $2,000 more on the sale.
Three of the least expensive ways to improve the condition of your home is with cleaning, landscaping, and fresh neutral color paint.
Every home is different, and there are times when you will have to make improvements on your home that do not net you a return simply because they will keep buyers away.
The best way to determine exactly what needs to be done for your house to sell is to look into the comparable properties in your neighborhood that have sold. Many of the best Real Estate Agents will call other Agents looking for more information about other properties that have sold. From these conversations you can investigate:
- Are there any buyers left-over they know of?
- What weaknesses did they address to get it sold for that price?
- You are also marketing the home to another agent who may know of buyers in the area?
Learning more about the comparable properties that sold in the neighborhood, and if there are any buyers left over, is an excellent way to get a home sold.
In my market here in Raleigh, NC homes are selling in a matter of days and the buyer pool is so large there are often multiple offers. This stems from the population growth and the number of people who are relocating here.
Professional Negotiations in Real Estate
One of the fastest ways to lose a deal is to approach negotiations unprofessionally. The selfish sellers will be the first to lose buyers, and the sellers who are upset easily will also lose buyers. If you convey a personality of greed or anger the buyer will walk fast because they are no longer emotionally tied in the way they once were.
Put yourself in the shoes of the buyer. When someone wants to buy something it’s because there is an emotional tie. Whether it’s a home or your cell phone, there is an emotional tie. Now that price tag is a lot less than a house so keep in mind that the emotional tie needs to be a lot stronger for someone to spend hundreds of thousands of dollars.
Top Sales and Marketing Techniques
You spent a lot of time building equity in your home, it’s important you get the most out of it. Real Estate Agents know the best marketing and selling techniques that will ensure your home is sold fast and for top dollar. This saves sellers money.
Leveraging a reverse prospecting system is a great sales tactic that works for selling homes. It also gives both sellers and Reatlor’s a great return on their investment becuase it only costs effort and time. By calling Agents who are working with buyers that match your criteria you will put yourself in a great position to procure a buyer. Also, circling around with Agents who have listed homes for sale in the neighborhood that are either recently sold or contingent is an excellent way to help sellers find a buyer.
When I go on a listing appointment one of the final things I do is call the listing Agent for a local home that sold, with similar criteria, and I ask if there are any buyers that reached out that I can connect with. This shows the sellers that I’m not afraid of picking up the phone and finding them business. Sometimes I walk away with information
If you are spending money on advertising platforms that are not giving you a return on your investment than you’re wasting marketing dollars, and decreasing your net on the sale. Realtors will pay for your marketing, and they know where to invest it to save you the most money possible.
The Founder of forsalebyowner.com couldn’t sell his home himself, and when he listed it with an Agent it sold for $150,000 more than when he initially tried to sell it alone.
This is how top sales and marketing tactics save Sellers money on the sale of their home.
Stay Disciplined from Your Emotions
One of the biggest mistakes sellers make is they become emotional. When you become emotional your decision making is impacted. Some of the worst decisions people make is when they are the most emotional. There are different types of emotions, either way you need to harness these emotions and put them to work for you.
The best decisions people make are when they are focused on accomplishing their goals and take action. If you allow your emotions to control you, they will keep you from accomplishing what you are set out to do.
A number of times I have seen sellers become upset and frustrated by buyers and they lose sight of what they are trying to accomplish. These sellers become emotional and rather than sell their home they become overly emotional when a buyer asks for things to be fixed or sends over a low offer.
Understand that if you put yourself in the buyer’s shoes there’s a good chance your actions would be similar. You would want to buy the home for the best price possible. If you can put yourself in the shoes of the buyer than you will give yourself a much greater chance of accomplishing your goals.
A strong Real Estate Agent will be able to ensure you stay disciplined from your emotions and stay focused on the objective at hand. The ability to keep emotion out of the sale of your home is one of the best ways to save sellers money.
Final Thoughts on Saving Sellers Money:
One of the most common reasons someone would sell their home without an Agent is to save money. While you may be saving on the front end, statistics show you are losing on the net. In the end, the net result is what matters.
This is why top executives at companies like Craigslist, forsalebyowner.com, and byowner.com all use a Realtor to sell their home. They want to maximize the return on the sale, and save money by doing so!
Hi there! I'm Ryan Fitzgerald, a REALTOR in Raleigh-Durham, NC and the owner of Raleigh Realty. Chances are you and I share a similar passion, Real Estate! I also have a passion for technology, sports, and people. Would love to hear from you. Drop me a note in the comments section below and feel free to share this article socially!