Selling or leasing your home can be a very stressful and time consuming process. There are many routes you can take and they all have their pros and cons. It is essentially a tradeoff between time spent and money spent. The more time you spend trying to sell or lease your home, the less money it will cost you, and vice versa. Spending less of your time will result in you having to pay more money to sell or lease your home. This article will cover 3 options: the traditional option of selling or leasing with a realtor, the trending option of selling or leasing “for sale by owner” and a third, hybrid option.
Your first option is the most traditional choice:using a real estate agent.This option will generally make things easier for you because they will take care of most of the selling/leasing process. If you a very busy person with little to no free time, it may be a good idea to hire a realtor® and let them take care of it. On the other hand, this is the most expensive option so it all depends on your lifestyle. Real estate commissions are generally 5% of the selling price or one month’s rent if it is a lease agreement. So if you decide to sell or lease with an agent, you have to be willing to fork out a hefty amount of money. To put that into perspective, 5% commission on a $750,000 house including HST is $42,375. That is a lot of money to spend, especially considering how fast houses are selling these days.
Another option is to go the “for sale by owner” route. This option will cost little to no money and will only require your time. There are many for sale by owner websites out there that have houses and condos for sale, apartments for rent, and houses for rent. Listing on these sites generally costs a flat fee that is at most $1,500. Provided that you manage to find a buyer who acts on their own behalf, without a realtor®, that is the only cost that you would incur, besides of course your own time. So using the same example, selling a $750,000 house “for sale by owner” would save you at least $40,875. If the buyer is represented by a realtor®, you will be required to pay some form of commission that you will negotiate directly with the realtor®. Based on our example, this will cost you a maximum of $22,688 compared to $42,375 that you would be required to spend if you decided to list and sell with an agent (savings of almost $20,000).
The third, and final option is a hybrid solution. Homeowners can sell or lease their home “for sale by owner” and take advantage of the services that a realtor® can provide. Homeowners can pay a realtor® for the service of posting a flat fee mls® listing. This service generally costs about $100 and it combines the exposure of listing with a realtor® with the savings of listing “for sale by owner”. This is a great way to promote your home, but be prepared to receive numerous phone calls in a short amount of time. This is not a bad thing, but it is something that you have to be ready for.
No matter which route you decide to take, this can be a stressful moment in your life. You have to weigh the pros and cons of each option. There has to be a tradeoff between money spent and time spent. What works best for one person may not be the best option for another. Make sure you do your research before you make this very important decision or you may end up regretting it.