Evaluating the Cost of Working with a Real Estate Agent vs. Going it Alone

 

 

 

If you are selling or buying a house, you may be torn between having a real estate agent working with you or going alone. For most people, the real estate option feels like the least hectic. 

However, it doesn't come cheap, and you may wonder if the cost is worth it. The first step in helping you make the right decision is establishing these costs and their impact on your home buying or selling.

This guide evaluates the costs of the two options and can be a good read before making a choice.

Cost of Using a Real Estate Agent
Commission 
Real estate agents charge a commission for each sale, with the cost being split between the buyer and the seller. Typically real estate agents charge a 5 to 6% commission on the value of a house, but there can be room for negotiations depending on the house's value.

So, if your home is valued at $100,000, up to $6,000 will go to your real estate agent as a commission. 

Closing costs
Selling a home involves additional costs such as transaction fees, marketing expenses, and administrative costs, which the real estate agent can pass on to you as closing or service fees. 

These costs can vary with a realtor and the location, so you may want to ensure that your agent comes clean about these costs right from the beginning. For example, the cost of buying a home in Florida inclused additional expenses like homeowner's insurance, property taxes, and possibly homeowners association dues to consider.

Home preparation costs
Listing a house for sale is not the end of it. It may need to get prepped for the next occupant through renovations, cleaning, upgrading, etc. These costs will be passed on to you by your agent. 

What Do You Lose for Going It Alone?
The total cost of completing a sale or buying a home with the help of a real estate agent can be significant if you look at it at face value. So you may feel tempted to go it alone. But before you do, it's essential to consider what you will be losing.

First, experience and expertise can mean fetching the best rates or getting a home at the best rate possible since a real estate agent will have industry insider knowledge.

Besides experience, you get a speedy sale or home buying. So if you are in a hurry to sell your home, you will want to trade the ‘for sale sign’ in your yard with one from your real estate agent and a listing on other boards.

Finally, real estate agencies will have access to the resources, databases, and networks that help make the house-selling and buying process much more manageable. Plus, you do not have to do any heavy lifting. All you need is to agree with them and wait for a buyer or seller.

 

Choosing a Real Estate Agent
Choosing an agent to work with is a serious undertaking because it can significantly impact your home-buying or selling experience. The most crucial factor to consider when selecting a real estate agent is their license status.

After establishing that they are licensed, you may also want to look at their track record. It is also critical to trust your gut. If working with a specific real estate agent doesn't feel right, they probably aren't a good fit. 

You could also consider working with online real estate agents such, which offer the same convenience as traditional real estate agents but at a much friendlier price. Additionally, these agents have a national presence, so you do not have to worry about the geographic region of practice. 

Final Words
It is possible to sell a house without a REALTOR. However, it may be costlier than involving a real estate agent going by the above mentioned points. 

While circumstances may vary, it is always best to seek expert help. Alternatively, you could use online real estate resources that are way cheaper but offer the same quality of services as traditional real estate agents.