18 Questions For Every Home Seller (Part 6) e-book

5.            Should I sell my home myself?

Ultimately, it is the seller’s responsibility to prepare the property for sale (or hire someone to do some or all of this work), select a selling method, and see the transaction through to completion (or rely on a broker tidy up the loose ends). In this section, we’ll help you make an informed decision about the roles brokers, agent, and consultants can play in the sale of your property and the cost of doing so.

Should I hire a real estate agent or broker?

A good agent or broker can tell you how much your house is worth on the market today, and it is his or her job to find and negotiate with a buyer to realize that value. You can hire a certified broker directly, or an agent who’s more of a salesperson. In this case, the agent will be supervised by a broker.

Obviously, hire a broker or agent you are comfortable with. And hire someone you believe is a strong bargainer, since in traditional sales your representative negotiates the final price with the buyer’s agent. In this case, the agent’s commission provides the agent’s incentive to keeping the price as high as possible. But what if the house receives no strong bids? In this case, an unscrupulous agent or broker may try to convince you to drop the price substantially to guarantee the sale (and guarantee the agent’s commission) before your contract with him or her expires. In this example, the broker has a strong incentive to undercut your confidence in the value of your property. Since an important aspect of every agent’s role is to help you understand the real value of your property on the market today, this unfortunate situation can be easily missed by many sellers.

The simple reason why a growing number of sellers today forgo the services of a broker or agent is this: the listing/selling agent typically collects up to a whopping 6% of the sale price of the property. (Additionally, buyers typically pay buying agents 3% to assist them in the transaction.)

Why do listing agents charge 6%? In reality, the broker who lists the property collects only 3% because the brokerage that finally sells the property collects half of the 6%. If you know you may end up paying two separate brokers, it is natural to ask yourself why you shouldn't just pay one: the one that actually sells your property.