In an age of technology and information, it’s become common place for folks that would normally hire a professional, to try and do things on their own. I know I have taken to youtube a few times to make repairs around the house and similar. Truth be told, there is definitely some merit to doing thing on your own when it’s realistic.
In real estate, there are consumers who take this belief and run with it. They have so much good information available, right at their finger tips that it doesn’t seem out of the question to buy without an agent. The belief is that if they buy direct, they will get a discount or similar. In some ways, that can be true, providing the other side of the deal is willing to take that into consideration. After all, a buyer can find the home they want online, get the listing agents number and see if with them, or they can go after a for sale by owner (FSBO) and work directly with the seller. Unfortunately, buying or selling a home has many moving parts that need to work together and there is also a side to the transaction that all the online data in the world cannot provide. Let’s look into that aspect a little deeper.
You can go online and find a home. You can get school information, financing options, recent sales etc. What you don’t get are the more detailed processes that help determine real value or the nuances that only a real person can tell you about a location. Take me for example. When I show a person a home, it’s usually several at the same time and involve quite a bit of car time. During the trip, I am constantly mentioning things about the area, recommending restaurants, local hangs etc. You won’t get that on a website. Once under contract, there are so many timelines that must be met to keep the client in compliance and protect their interests. Same goes for sellers. I can’t tell you how many times a seller and I have worked on the value of a home only to have the home sell for thousands more than of the seller had gone with their original online assessment. Yes, there are thing that I do that any other person could do, but the reality is that most would not know how to put it all together and then execute a plan of attack. Did you know that currently, the FSBO market has never been lower. Sellers know that they can’t possibly market as well as a good agent can and that buyer also want use their own representation. Believe me, I get the appeal of going FSBO, but I know the business. The online presence is crucial of you want to get as many potential buyers as possible. Competition is a good thing! If things are the other way around and you have a unique home that only a select group of people will like, it becomes even more important to get maximum exposure. As an individual, you will not likely have access to the marketing an agent does and to take that a step further, your agent might not even have the same access as an agent with a brand behind them. Let’s say ABC Realty, a small office with maybe 10 agents lists a home. They put it on the local MLS and that’s about it. They do an open house perhaps, maybe a few flyers and maybe even place a Facebook ad. That’s all fine and well, but how do they truly reach a broader audience? That costs a lot of money to have that kind of reach. As an individual, it’s not a good return on investment. As a corporation, where all the individuals pay toward to marketing, it becomes MUCH more affordable and the end result is a better listing reach for the consumer. Think of it like an HOA that has to maintain large common areas and roads etc. One person alone would not be able to afford it, but as a group, the cost become manageable. That is why good real estate brands make more sense than boutique ones. I know this as I have done both.
As a buyer, you should realize that you do not pay the agents commission. The seller pays his agent and then the two agents have a payment agreement. The belief that if you don’t use an agent on your side you get a better deal, is very flawed. The agent likely gets the entire amount from the seller. Few will actually offer a discount when they have both sides. Same is true with builders. They do not offer discounts if you buy direct. Your agent there, can help you ask the difficult questions to the builder agent. Keep in mind that you have no representation from the builder agent they represent the builder only. Their job is to sell you that home. When you bring your own agent, their job is to help you negotiate the best possible deal. At the end of the day, you usually benefit more by having your own representation.
I like to look at it this way. There are just certain things that make more sense to hire a professional for. Things like cutting your hair, changing your oil or painting your home. Those are fairly easy things to do but most hire someone. Buying or selling a home should not be anymore different.