Perhaps I should have titled this blog, “Make sure you USE a REALTOR,” because so many people have an idea they can save money by skipping the agent. This is simply not true, and I need to be completely open with you regarding some of my past deeds and poor choices.
Way back in the day when I was in the Air Force, we moved every 2-3 years. That makes it tough to make money on a home purchase, but I did not want to live in rental homes for 22 years, so we bought homes. The first house I bought, we used a REALTOR. We sold the home 3 years later using the same agent, and it bothered me a bit to pay the 6% commission. After all, the home was about $100,000, and the math on that is pretty easy to do. It wiped out nearly all of the appreciated value we had accumulated in the home.
The next home we bought was a FSBO (for sale by owner). The deal went smoothly, and I thought, “wow, never using a REALTOR again!” We sold that home 3 years later, also FSBO, and again, the transaction was perfectly smooth. Next home was a different story, however, and as we tried to sell it there was nothing but anxiety and stress. It sat vacant for over a year, mostly because I had overpriced it when I put it on the market. I had been stationed to Alabama, and the home was in Missouri. That was tough. Eventually, after paying two mortgages for over a year (and losing way more money than I would have “saved” via the 6% commission), I hired a realtor and got it sold.
Meantime, after just a year, we were stationed away from Alabama and off to the Pentagon. Knowing it was nearly impossible to break even after having owned the home only a year, I decided to go FSBO. Pretty dumb, but I still hadn’t figured out that this method actually cost me money rather than saving it. To make a very long story short, the transaction was a nightmare. We found a buyer, but through a series of events the entire thing went from bad to worse. Eventually we closed on the house, but it caused me so much stress that I vowed never to do that again. I very nearly had to take the buyer to court, and that would have been even more costly in terms of time and money.
Use a REALTOR. I’ve seen it with several of my friends in Louisville who have also tried to save some money in commission fees, and it very rarely goes well. It’s sort of like gambling: every once in awhile a FSBO is a great experience, so you can get the impression you’ll always win. Don’t do it.
With a REALTOR you will get more for your home (even after commissions are taken into account), you’ll sell it faster, and you’ll have a pro to rely on if things begin to go a little screwy.
Next blog we’ll look at how to choose a REALTOR who is right for you.