Even if people have not participated in a real estate transaction personally, many still believe they know how buying and selling works. Buying and/or selling a home isn’t something most people do on a daily basis, but because they have heard stories of other peoples’ transactions, they may think they know the ins and outs of real estate. For everything that is known about the industry there are also a number of myths that circulate about how real estate actually works. Believing these myths can hurt the chances of buying or selling a home at the right price.
Not Using an Agent
Yes, it is true that you can save some money by doing a real estate transaction on your own, but you are missing out on valuable knowledge that an agent has and may in the long run end up spending more money. Not using an agent when buying a home that is listed by an agent will not save you any money. The list price of the home already includes the commission. If you don’t use an agent the listing agent will get the full commission.
Selling your home on your own can seem like an inexpensive way to go. Think about how you will go about getting showings outside of having a sign in your front yard. A real estate agent has access to the MLS (Multiple Listing Service) where thousands of agents can see your home, along with many other ways to showcase your home. It would cost you a fortune to advertise your house the way a licensed agent can.
There are many things that can go wrong in the time between signing a contract and closing. These situations can be costly for a seller on their own. A real estate agent can help you navigate negotiations and problems that may arise during this period.
Pricing Your Home too High
Listing your home at too high a price may actually net you a lower price. A lot of buyers aren’t interested in looking at homes that are out of their price range or above market value. You can always lower the price when you don’t get any interest, but people are suspicious of houses that have sat on the market too long. It’s a good idea to look at comparables in your neighborhood and set your price at a competitive price.
Sellers tend to believe that open houses sell houses. Homes rarely sell to buyers who visited them during an open house. Open houses bring in more people who are curious than those who are looking for a home. A lot of agents use open houses to find additional customers who are looking to buy or sell their home.
Doing your research about real estate and what to expect is a good idea especially if you choose to not use an agent during your transaction.