When most families decide to sell their home, their first step in the process is contacting an agent, though seldom without first sparing a thought to listing without one. In 2016 and 2017, for-sale-by-owners (FSBO’s) accounted for 8% and 7% of home sales, respectively. Though only a small piece of the proverbial pie, when you factor in the ~5.5 million existing-home sales in the U.S. each year between 2015 and 2018, that 7-8% begins to look fairly significant—roughly 300k to 400k homes per year. I understand their decision to list their homes without an agent. Sellers decide to take this road less traveled for a variety of distinct reasons, and for me to dismiss them as without merit (as many agents will do) would be both condescending and, frankly, wrong. However, I’d like to address a few of the more popular motives specifically, in hopes that I might persuade you to make what I consider to be the wiser choice.
Reason #1: Listing without an agent can save you thousands of dollars. A listing agent typically charges a commission of 6%, with 3% of this commission going to the buyer’s agent. Even when listing without an agent the buyer’s agent commission is practically unavoidable, so listing as an FSBO can only save you, realistically, around 3% overall. On a $200,000 home this comes to $6,000! If you are rolling the funds from the sale of your home into the purchase of your next home, you can expect to pay that $6,000 off over the next 30 years, which lands closer to $10,000 at typical interest rates. This is an amount that no fiscally conscientious seller can afford to scoff at, obviously. But are these savings realized?
A recent study of more than 7 million home sales over the past four years revealed that the season in which a home is listed may be able to shed some light on the likelihood that the home will sell for more than asking price, as well as how quickly the sale will close.
It’s no surprise that listing a home for sale during the spring saw the largest return, as the spring is traditionally the busiest month for real estate. What is surprising, though, is that listing during the winter came in second!
“Among spring listings, 18.7 percent of homes fetched above asking, with winter listings not far behind at 17.5 percent. While 48.0 percent of homes listed in spring sold within 30 days, 46.2 percent of homes in winter did the same.”
The study goes on to say that:
“Buyers [in the winter] often need to move, so they’re much less likely to make a lowball offer and they’ll often want to close quickly — two things that can make the sale much smoother.”
If you are debating listing your home for sale within the next 6 months, keep in mind that the spring is when most other homeowners will decide to list their homes as well. Listing your home this winter will ensure that you have the best exposure to the serious buyers who are out looking now!
The study used the astronomical seasons to determine which season the listing date fell into (Winter: Dec. 21 – Mar. 20; Spring: Mar. 21 –...