Last Updated: March 27, 2022

Buying or Selling Your House without a Realtor

Written By: Barbara L. Pearce
A hand holding keys next to a home sold sign

These are unusual times.  Inventory of housing stock is exceptionally low, leading to frustration on the part of homebuyers.  Some are taking matters into their own hands, and approaching owners, whose homes are not for sale, with unsolicited offers.  While there are certainly times when that can work, there are pitfalls for buyers, and especially for sellers. 

Risk With No Reward

Surprisingly, the biggest risk for sellers across the country is that they will sell for too little, without expert advice.  It may sound unlikely, given the tales of houses going for way over the asking price, but that’s exactly the point.  The asking price is set for a reason, and often that is to spark a great deal of interest, which will lead to a bidding war.  The bidding war, long the bane of buyers everywhere, is the key.  It’s that competition that can drive prices above previous levels most easily, as people get caught up in the emotional chase for a winning contract.  Without that group of interested buyers, it is hard to re-create that sense of urgency, or push someone to a new high for the neighborhood.  It’s the very nature of trying to get what many others also want that changes one’s perception of value. 

Extra Work and Additional Risk

There are other risks of selling oneself, mostly having to do with legal compliance and attention to detail.  Actually, many people who have successfully sold their own properties say that they would never do it again.  The stress of dealing directly with the buyers is real, and it’s often good to have a professional in the middle. While lawyers can pick up some of the slack, they usually bill by the hour, so that option isn’t free.  Certainly, there are multiple instances of productive off-market sales, and a truly motivated buyer may be compelled to make it worthwhile for the sellers to move.  Some very unusual homes may not be helped by a broader exposure, although the other side of the coin is that one would do exactly that, in order to find the right buyers. 

It is tempting to think about saving the commission, by going it alone.  While that can save money, it’s clearly true that the buyer who approaches a seller not looking to sell is the one who would feel entitled to the break in commission, by taking that off the price paid.  Even if the buyer doesn’t go into the deal expecting to get the commission, there is no reason to expect that the sellers would be keeping it all.  That means that deciding to try to sell one’s own house should come with the expectation that half of the commission might be saved, which could change the equation, given extra work and additional risk. 

No real estate rules are absolute

But many buyers choose to pay their own agents, in order to gain that expertise.  Some sellers try to engage a real estate agent to put together a transaction that arose privately, and that can also work.  It’s just worth considering the options, and not jumping to the least cost alternative.  Would you do your own medical exam?  Inspect your own septic system?  Represent yourself in court?  Maybe, but probably not.

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