This is just one scenario but it is not uncommon. Many homeowners think that they can sell their home themselves and that it would be cheaper and easier. Most people assume that they will just start outselling by themselves and if the house doesn't sell then maybe they will contact a real estate agent. While not everyone has this frame of mind, many homeowners naturally assume that they could save the commission by selling the home themselves. So let's take a recent scenario that is extremely common in today's society.
Bob wants to sell his house. He owns a home in Beaverton and has noticed that the homes around him have sold for between $420,000 and $550,000. He looks at what has sold in assume his home is worth at least $520,000. It may not be as nice as the $550,000 for sale home but it's definitely nicer than the $420,000 house. Bob is only going on what is currently listed for sale, not on the sold price, which real estate agents and appraisers look at. What a home is listed at is not necessarily what it will sell for.
Bob does a few little upgrades and some landscaping tasks and lists the home at $520,000 for sale by owner. He puts an ad in the newspaper and a sign in the front yard. He figures the market is good so this is a no-brainer.
He gets a couple of calls from buyers agents, not the buyer themselves. He says he doesn't want to work with an agent but the agent is free to bring the buyer by or the buyer is free to contact the homeowner directly. Most buyers agents work for their buyer and receive half the commission from the sale price of the property. Since Bob is not using an agent there is no commission and since he refuses to work with an agent, one of those two buyers agents decides to move on. The other agent says that they will be happy to facilitate the transaction should their buyer like the property for a nominal fee. Bob says he will entertain the idea as long as the buyer comes without their agent.
The buyer stops by the property and looks over the house. Bob accompanies the buyer through the home talking about how amazing the houses and making the buyer feel very uncomfortable. It's almost as if the buyer doesn't feel the same way that Bob does about the house Bob feels a little bit insulted. This can be quite uncomfortable for a buyer, especially if their agent is not present.
Because the buyer is pretty uncomfortable they leave quickly and talk to their agent about the price of the house. The buyer's agent does their own research on similar properties that have sold in Bob's area. Come to find out, the price is a little bit high. $495,000 is a more accurate market value for Bob's house.
As the days roll into weeks, Bob ceases to see any more activity on the house. He decides to drop the price to $505,000. He still doesn't have any activity on the house because the property is not on the MLS and there's no notification to any buyers agent that there is a reduction in price. Bob then decides to pull it off of the market, wait a month, put it back on the market at $475,000. During this time the other homes have sold and new homes have hit the market but the market has also changed. Home prices are now between $400,000 and $490,000, making Bob's house still one of the highest-priced homes in the neighborhood.
After another month of no activity, Bob decides to contact a real estate agent. The agent offers tips and suggestions to appeal to today's buyers and the current market. Bob decides to make a few adjustments on the house in the property itself and the agent decides to list at $485,000. However, the agent now lists on the MLS as well as draws up flyers, markets to existing buyers agents and their buyers, and has an entire social media and online marketing campaign where the house is now seen by thousands of potential buyers.
Because this is technically a new listing for the MLS it gets a lot of activity right away. The agent has an open house the first weekend and within about a week it's a full price offer.
While this is not always the case and every situation is different, consider this, Bob will have to be his own agent and potentially deal with a buyers agent. He may have to give up commission anyway and facilitate all of the legal documents, discuss documents with a real estate attorney, potentially spend money down that avenue, and risk making sure everything is done correctly and legally. This can be extremely stressful. Most homeowners don't realize all the legal documents and paperwork necessary to transfer title, deed, and close escrow. Even if you're buying a home with cash or selling by owner, escrow, title, appraisals and inspections all still need to be conducted. All in all, it's usually not less expensive to sell a home yourself but the stress of it all is really where homeowners find the most benefit. Letting an agent do everything for you, facilitate the transaction and make sure things are done legally is really priceless.
Sure, anyone can sell a property themselves but there are so many details involved not to mention all of the legal jargon and real estate parties that it's just plain worth it to have a real estate agent or brokerage market, price, and sell your home.