For sale by owner vs. realtor: Which option is better for you?

What are the benefits of selling your home with a realtor?

Selling a house can be a full-time job. If you already have your own job and family responsibilities, it may be tough setting aside the extra hours it will take to market and sell your home. A realtor handles a lot of things behind the scenes, including:

• Staging and photography: Many real estate companies work with home stagers and professional photographers who know exactly how to present your house to make it as attractive as possible to potential buyers.
• Pricing the house: Professional agents understand the local market well, so they'll know how to price your house to appeal to buyers while also helping you make the most profit. There's less risk of overpricing or underpricing your listing.
• Marketing: Licensed real estate agents have access to a website called the Multi Listing Service (MLS). This is the primary way buying agents find listings to share with their clients. If you don't have your real estate license, you won't be able to post your FSBO listing on MLS.
• House showings: A real estate agent will handle any open houses or one-on-one home showings, so you don't need to worry about changing your schedule or leaving work early to meet potential buyers. Many potential buyers also feel more comfortable viewing a house with a third party.
• Legal paperwork: Realtors need to take classes and renew their licenses every couple of years to ensure they're up to date on all the legal processes involved in selling a house. If you choose to go the FSBO route, you may want to hire a real estate lawyer to help you with the paperwork to make sure everything is done by the book.

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What are the benefits of selling a house by owner?

The main reason some homeowners prefer to sell a house without a realtor is to avoid paying commission. Realtors typically get a 6% cut of the sale — 3% for the seller's agent and 3% for the buyer's agent. That may not seem like a lot, but a 3% commission on a $350,000 listing equals $10,500. That amount can cover the work an agent does while selling your house, but if you sell the house on your own, that money stays in your bank account.

Note that you'll likely still need to pay a commission to the buyer's agent even when selling a house without a realtor. This is their commission for helping the new homeowners on their house-hunting journey. You may be able to negotiate an amount with them, but keep in mind that 3% of the sale price is standard.

How will the National Association of Realtors 2024 rule affect selling and buying a home?

Most sellers are aware that when a home is sold, a commission of 5% to 6% is paid by the seller and divided between the agents for the buyer and seller. The new rule states that a seller will need to decide whether, and how much, to pay a buyer's broker. In addition, the buyer and agent are required to negotiate the commission and sign a binding agreement before viewing homes.

When should you sell a house without a realtor?

You may consider listing your home as FSBO if you already have an interested buyer or if you have real estate experience. If you have a buyer lined up, you may save thousands of dollars without the added stress of marketing the house, conducting showings, or potentially having the house sit on the market for a long stretch of time. However, it may be worth hiring a real estate attorney who can make sure you're following all the correct legal processes along the way.

If you have a strong knowledge of the real estate industry or you're a realtor yourself, you may already have the same connections and knowledge as an agent. And if you don't mind putting in the work on marketing and selling the house, you get to keep your portion of the commission from the sale.