For Sale By Owner Vs National Association of Realtors

Potential and existing homeowners for sale should take the ongoing rhetoric from the National Association of Realtors (NAR) with a grain of salt. The NAR has a significant interest in how you choose to sell your property. Did you know that approximately $60 BILLION in real estate commissions are paid out annually (an increase of 19 billion since 2000)? In a well-planned and well-funded effort to justify their services and the astronomical fees they collect, the NAR spends millions of dollars each year deluging the average homeowner with propaganda.

Real estate agents would have you believe that it is totally impossible to successfully market and sell your own home. The reason they propagate this fallacy is painfully obvious, but it’s shocking how convincing they can be and how often homeowners fall victim to their ploys.

Let’s put some of the most common NAR rhetoric to sleep:

FSBOs are not sold for less

FSBOs take no longer to sell

FSBOs do not inadvertently expose themselves to potential thieves, rapists, or murderers

FSBOs can effectively market their own property

FSBOs can effectively sell their own property

FSBOs can save thousands of dollars in commissions

In truth, the National Association of Realtors does some things very well. First, they collect, compile, and distribute very accurate real estate-related data that can be very helpful when creating a For Sale By Owner marketing plan. This data is drawn from hundreds of thousands of home sales, so the data is highly accurate. Most of the data, if not all, is available on the Internet. This data includes, but is not limited to, average number of days on market (DOM), average and median sales prices (compiled monthly and seasonally adjusted), unit sales by region, and unit sales by “Metropolitan Areas.”

The NAR also compiles statistics related to “Buyer” and “Seller” trends, these statistics are generated through surveys of both buyers and sellers. Some of the data says a lot, for example, more than 70% of home buyers in 2006 used the Internet to find the house they finally bought, before hiring a real estate agent. Second, 18% of homebuyers said the first display of the home they bought was a FOR SALE yard sign. Do the math: That means over 88% of “BUYERS” found the property they ultimately bought without the help of a real estate agent, yet 85% used an agent to facilitate the purchase, who say marketing doesn’t work.

The second thing they do very well is market real estate; this is done through their proprietary data service, the Multiple Listing Service better known as MLS. This real estate listing data, while proprietary, is not restricted to real estate agents, it is available to virtually anyone with internet access., the consumer-oriented website is a by-product of the MLS, this premier marketing tool for Realtors is also available to virtually anyone. Owners for sale can invest in Flat Fee MLS. The concept is simple: Instead of the “listing agent” taking a commission based on the sale of their home, the owner agrees to pay a fixed fee to a registered real estate agent; This fee typically ranges from $399 to $699 depending on your geographic area and level of service. The agent simply agrees to list his property on the MLS. This exposes your property to all real estate agents through the MLS database and to most potential buyers through (remember that over 70% of buyers found the property online BEFORE hiring an agent), which enjoys over 7 million monthly visitors generating over 350 page views. BEWARE: Not all flat rate MLS are created equal; make sure you know what you are buying and that there is some level of support.

One of the biggest problems I’ve always had with real estate agents (apart from their high commissions) is that they have a different mandate than the typical homeowner. The mandate of a real estate agent is to sell “a” house and receive payment of his commission. The owners mandate is to sell their home. How often do you think a prospective buyer calls to schedule a viewing for a specific property (your property) and the agent says, “Sure, we’ll schedule an appointment, but while we’re looking at that property, let’s look at these ‘others’ that I think you might be interested in.” Personally, I don’t blame them, that’s how they make a living; I would do the same thing, it’s called “betting hedging”. The inherent problem is that a real estate agent can be successful without the owner. A great example of this is “Open Houses”, in my opinion they are simply a lead generation platform for the listing agent. The “visitors” come to see your house, the agent takes his name and contacts them to sell them any house, they have simply used your property and your time as a hook.

I always have to defend myself, and I want to be clear, I don’t hate realtors. They definitely perform a service that some people are incapable of performing. However, I do have a problem with the fees they charge and their relentless attack on FSBOs. I’ve always felt that if someone had to run in the competition in an effort to justify themselves, that was a sign of weakness.

Simply put, you can sell your own home and save thousands of dollars; don’t be swayed by the NAR and their unsubstantiated claims. Don’t believe something just because you saw it on TV – it’s a shameless effort to protect themselves, their association and a livelihood that is under significant pressure to justify their fees. It is not a coincidence that the US Department of Justice is currently investigating the industry for antitrust violations. Change is coming, and it will shake the very foundations on which this association was founded. The internet has changed the way people buy and sell real estate – it’s time real estate agents accepted that fact and either adjusted accordingly or went the way of the Dodo bird.

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