Selling Your Home

• For many people, real estate is one of their major, if not their only, assets. Homes are often purchased with the intention of building equity and later selling the home for a profit. However, many factors can affect this future sale. Home sellers must not only consider the condition of their property, they must also evaluate homes in their neighborhood, stability of the housing market and the ease of mortgage lending. In addition to these factors home sellers may lose more profits through Realtor commissions and closing costs. Realtor commissions differ across companies and are generally calculated as a percentage of the overall selling price of the house. Typically this commission will vary from 5 percent to 7 percent. According to "Money Magazine," the average commission that home sellers pay their Realtor is $10,000 (2007). This can be a costly service during what is known as a buyers market, or a period where there are significantly more houses for sale than people purchasing them. This buyers market drives down housing costs and eats into the potential profits of home sellers. Not to mention that despite a realtor's promise to eagerly market your home, they frequently have multiple homes that they are showing in a period of time. Therefore, they may not be advertising to your satisfaction.
  
  

Incentives of Selling Property Without a Realtor

• Home sellers can save this commission by choosing to sell their homes privately. Therefore, rather than having a Realtor list, advertise and show their property, home sellers would do this themselves. Although this process may at first appear challenging, it is becoming an increasingly popular option for home sellers. Individual home sellers can purchase signs, list their property in newspapers and online, and host open houses for people to view the property. They also have increased flexibility with sales price because they work directly with the buyer rather than negotiating through a realtor. This also allows the seller to lower their price because they are not paying a realtor commission. It is important that home sellers become familiar with all steps of the selling process prior to listing their home. This includes working with their title company, learning disclosure agreements and possibly consulting with a real estate attorney.
  
  

For Sale By Owner Services

• Another option for people who choose to sell their homes privately is to enlist a "For Sale By Owner," or FSBO, service. These companies offer a variety of assistance ranging from a website to list the property to personalized signs to place at the property. Their websites often provide guidance on the home selling process. Their fees vary according to the services offered.