Getting ready to sell your home? One of the first decisions you need to make is whether you’ll work with a Realtor or sell your home on your own. While it’s tempting to go it alone, it may not be the best option for your particular property, location, and skill set. These handy FSBO vs. Realtor statistics will help you make the best choice for your situation.
FSBO means “for sale by owner.” Owners who decide to sell without the help of a real estate agent or Realtor often hope to avoid paying a commission. Since commissions can be tens of thousands of dollars, some owners stand to save significant money. While some owners successfully negotiate profitable deals, others may decide a Realtor commission is well worth that percentage of the sale price.
Realtors are real estate agents who actively belong to the National Association of Realtors (NAR). Realtors are expected to comply with the NAR’s code of ethics and adhere to their standards. They are also required to take continuing education courses. Realtors are paid on commission, typically a percentage of the home’s sale price. Neither buyers nor sellers pay those fees out of pocket, so you won’t need to take out extra loans or save for the expense.
So, what do Realtors actually do? Realtors and real estate agents do more than list your home and sift through paperwork. When you work with a Realtor, you rely on their particular expertise. Realtors tend to have deep knowledge of the local market. They know key facts about property values, time spent on the market, and comparable sales, but they can also help you highlight key property features, desirable school districts, and more.
Your Realtor will guide you through the selling process, from initial listing to closing paperwork, and answer your questions. They’ll also make arrangements for professional photographs and use their advertising network to ensure your listing reaches a broad network of buyers. Finally, they can vet potential buyers and help you choose between multiple offers. Because they have more experience buying and selling homes than the average layperson, they can point out the perks or pitfalls you might not recognize on your own.
Although Realtors and real estate agents provide significant advantages for sellers, paying a portion of your sale price can be hard to swallow. These FSBO vs. Realtor statistics will help you determine whether you’d be better off selling your home on your own, or engaging the help of a Realtor.
It’s smart to understand how much you’re likely to pay in commission before making your decision. Just as home sale prices fluctuate by year and location, commission percentages vary for the same reason. Realtor commissions are usually somewhere between 5 and 6%, depending on location and average home sale price.
In 2022, the national average Realtor commission was 5.37%.1 The national average home price is expected to be $380,000 in 2023.2 Assuming the average commission rate and home price, the commission would be $20,406. While that’s certainly a significant amount of money, Realtor fees can be negotiated. They also tend to be lower percentages in high-demand areas.
According to the National Association of Realtors, only 7% of all homes sold in 2022 were FSBO — the same all-time low as in 2021.3 Although commissions can cut into your overall profit, and selling on your own is increasingly popular, the vast majority of sellers choose to rely on their agent’s assistance.
The NAR also found that 50% of FSBO sellers already knew their buyer before they decided to sell their home.3 If you already have an interested buyer, such as a friend or family member, you may not have to rely as heavily on a Realtor’s marketing services and valuation expertise.
On the other hand, even if you already have a buyer, Realtors can still help you determine how much your property is worth and guide you through the selling process. Consider asking an agent whether they’d be willing to lower their fees since they won’t have to help you market and list the property.
13% of homes in rural areas are FSBO. Just 6% of sellers in suburban areas choose this option.3 This may be attributable to less competition or lower home prices. If you’re not trying to sell in a crowded market, you may want to skip a Realtor’s marketing services and maximize your profit instead.
Before you decide whether to sell on your own, however, consider whether a Realtor could help you command a higher price. FSBO homes sold at a median of $310,000 in 2022, whereas agent-assisted sales had a median price of $405,000.3 Assuming the current national commission average of 5.37%, the commission would be about $21,750. With a Realtor, your sale would net $383,000 — $73,000 more than if you had sold on your own.
Of course, because commissions and property values fluctuate, you’ll need to do local research. In some areas, you might not see nearly the same rate of return.
When you sell your home with Orchard, you’ll work with an experienced agent who can help you maximize your list price so you can make top-dollar.
As of 2022, 88% of sellers use a Realtor or real estate agent to sell their home over any other option.4 Although video tours, 3D tours, and instant offers can complement an agent’s services, sellers seem to strongly prefer letting their agent do the heavy lifting.
Just 64% of sellers used desktop websites, 55% used mobile websites, and 41% used mobile apps in an effort to sell their home.
In 2022, 73% of sellers who used an agent or Realtor to sell their home used them to advertise and find potential buyers, as well as to finalize the sale However, that’s not the only option available: 18% hired an agent to finalize the sale, while promoting the home and finding buyers themselves. If you’re not confident about handling the paperwork on your own, consider asking a Realtor if they’ll take a lower fee in exchange for not needing to list the home, market it, and find buyers.
When you’re deciding which option to choose, it’s important to consider your own skills and limitations. For example, if you’re great at marketing and photography, you might be able to save a bundle on Realtor fees. But if you struggle to understand contractual paperwork, or you have a busy lifestyle, you might be at a disadvantage.
It’s also important to remember that just because you’re not paying a seller’s Realtor fee, that doesn’t mean you won’t pay a buyer’s agent fee. When both buyer and seller rely on agents, the fee is usually split between buying and selling agents. You will likely have to pay the agent who brought in a willing buyer.
While these FSBO vs. Realtor statistics can help you make a decision, there’s no substitute for doing your own research, talking to potential Realtors, and asking local family, friends, and colleagues about their recent home selling experiences. The more informed you are, the better your overall experience will be.
Source 1: Bankrate: “How do real estate agent commissions work?.”
Source 2: Statista: “ Median price of existing homes in the United States.”
Source 3: National Association of Realtors: “Profile of Home Buyers and Sellers 2023.”
Source 4: Zillow: “Sellers: Results from the Zillow Consumer Housing Trends Report 2022.”
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