In an era where technology allows anyone with a car to become a taxi driver, or anyone with a spare room to become an amateur hotelier, it’s understandable that more and more people are asking themselves, do I really need a real estate agent to sell my house?
There’s no straightforward, black-and-white answer to this question. It’s definitely possible for anyone to sell their house without an agent – but that doesn’t mean it’s easy. If you opt to sell your home as a “for sale by owner” (FSBO) listing, you’ll essentially be acting as your own agent, which means the many duties and tasks normally handled by your real estate agent are now your responsibility.
Is all that work doable for a first-time or lightly-experienced seller? Absolutely. But there are so many requirements for selling without a Realtor – including the ability to read the market in real time, reams of paperwork, a labyrinthine closing process, and marketing your home without the benefit of an established network – that you need to proceed carefully, methodically, and with a comprehensive checklist.
Of course, we haven’t mentioned that there are a lot of benefits to selling without a real estate agent, too. First and foremost, you save a lot of money (though maybe not as much as you might think).
Read on for a definitive guide to selling your house without an agent, including a detailed list of paperwork requirements, how to market your property, what to expect from closing, and the various pros and cons of going it alone.
Table of Contents
- Do I Need a Real Estate Agent to Sell My House?
- The Pros of Working with an Agent
- The Cons of Working with an Agent
- Selling a House without a Realtor Checklist
- The Best Websites for FSBO Home Sellers
- Paperwork for Selling a House Without a Realtor
- Breaking Down the Average Closing Costs Without Using a Realtor
- Why Should You Use a Realtor?
- Alternatives to Selling Without a Realtor
Do I Need a Real Estate Agent to Sell My House?
The short answer is: no. Although Realtors are licensed professionals, every homeowner is entitled to sell without an agent, if they wish to do so. According to data from the National Association of Realtors (NAR), only one in ten (11%) of properties sold in 2019 were sold as FSBO listings.
But selling without an agent can be a tough ask. Data from NAR also shows that while agent-assisted properties sold for an average of $280,000, FSBO listings sold for an average of $200,000 – a very significant dropoff.
Agents bring a lot of professional expertise to a transaction, especially when it comes to marketing your home, understanding how it fits into the bigger picture of the market, and conducting negotiations with the buyer, who’ll almost certainly be represented by their own experienced agent.
Of course, they’re very well compensated for all that work – the typical real estate commission is 6% of the final sale price. For a home that sells for the U.S. median home value of $252,000, that comes to $15,120. That’s a lot of money.
Let’s look at the pros and cons of working with a real estate agent.
The Pros of Working with an Agent
They Handle Negotiations and Paperwork
Very few homes sell for the list price; it’s understood to be a starting point for negotiations. That means that the negotiating table is where the final sale price is actually determined, whether that means going for five (or six) figures above ask, or taking a big hit on the price. It’s also where concessions and contingencies are hammered out, which can have almost as much impact on the deal as the price itself.
The buyer will be represented by their own agent, who’s likely negotiated many deals before. If you’re a lawyer or real estate professional, you may not have any problem sitting down across from their agent and working out a deal that works for both sides. But if you’re an inexperienced negotiator, the chances are slim that you’ll get anything close to the best possible deal. More likely, you’ll end up leaving a lot of money on the table – and you’ll have no idea how much.
Then there’s the issue of paperwork. A real estate transaction is governed by a web of federal, state, and local regulations, all of which come with their own forms. Browse our FSBO paperwork checklist to get an idea of just how much paperwork you’ll have to gather together. Forgetting any one of these required forms could bring the transaction to a halt, or even leave you open to legal consequences years down the line.
An experienced agent is intimately familiar with the required paperwork for a home sale, and will guide you through every step of a process. Selling without an agent means you’ll have to sweat out each step by yourself.
They Help Prepare, Market, and Price Your Home
Very few homes are ready to hit the market as-is. Most need to be refreshed or even renovated before they’re ready for public viewing. But what exactly should you do to your home to make it more appealing?
An agent has dealt without countless buyers and sellers, and has viewed even more properties. They know exactly what buyers do and don’t want to see in a house, and they can advise you on maximizing your home’s appeal. They can also advise you on the value of different renovations – for example, a kitchen renovation may impress buyers, but if it only recoups half its cost in price increase, it’s not a great option.
They can also market your home far more effectively than someone who’s not in the industry. Not only do they have access to the MLS, which is the main platform where home listings appear, and which isn’t open to non-Realtors, but they have a pre-existing network they can tap into to spread the word about your home. And reaching the widest possible audience is so important; if you have one interested buyer, you’re probably going to sell for less than the list price. If you have ten interested buyers, you’re in for a big payday.
And finally there’s the matter of price. The market is fairly unforgiving of improperly-priced homes; after a relatively short time on the market, buyers will have markedly more negative views of a home. That means setting the right price is, in many ways, the key to your entire sale experience.
An agent will instinctively understand the appeal of your home, how it compares to other properties presently on the market, and how high local buyers will be willing to bid. This suggests a principle of the market that many FSBO sellers may not understand; a property has no “true” value, there’s only what buyers are willing to pay. An agent can probably peg that number pretty accurately, but most FSBO sellers will just be guessing.
Remember, FSBO listings sold for an average of $80,000 less than agent-assisted listings, and a big reason for that is getting your pricing wrong. Can a seller perform all the duties usually handled by an agent? Yes. But is there going to be a dropoff in quality? Mostly likely.
In this case, that dropoff in quality seems to translate, on average, to about $80,000.
The Cons of Working with an Agent
Not All Agents Are Equal
As in any profession, there’s a spectrum of talent. Agents in the 90th percentile make more than 50% more than the average agent, and agents in the top 1% make several times more than that.
If you end up with an elite agent, you’re probably going to have something close to the best possible experience. If you end up with an agent on the lower end of the spectrum, you may not feel like your commission is being well spent.
This just points to the importance of doing your research on prospective agents. If you’re considering an agent, ask them for references, and quiz them about their transaction history to make sure you’re getting the right agent for your goals.
P.S. We’ve partnered with Clever Real Estate to offer elite agents who will sell your home for 1% or $3000. You get the savings of selling FSBO with the expertise of a home selling veteran. Get started by getting matched with agents in your area today.
Agents Are More Valuable to Inexperienced Sellers
If this is your first home sale, your agent is going to be a valuable source of advice and perspective. Going through the sale process for the first time can be a dizzying and intimidating experience – there’s a lot of money at stake, and there are a lot of people who are going to be making demands on you.
But if you’ve been through the sale process two, three, four, or more times, you probably have a pretty good idea of what to expect. You have a feel for the timeline of the transaction, the way buyers bluff and feint, and the amount of paperwork you’ll have to sign. If you’re a seasoned seller, an agent is more of a luxury than a necessity, and that 6% might seem like less of a value.
Home Sales Are Mostly Online Now
Pre-internet, real estate agents had almost exclusive access to home listings. Sure, there were grainy black-and-white photos of homes for sale in the local newspaper, but by and large, if you wanted to buy a home, you had to go to an agent. They’d consult their database of properties for ones that met your needs, escort you to the list of homes they’d compiled, and hope you clicked with one. As a seller, you were in essentially the same situation; you had to hope that agents showed buyers your property. Everything went through the agent.
Today, the majority of buyers find their home on the internet. That means they’re showing up to their first meeting with their agent with a list of properties they want to see. The agent will often supplement that list with their own suggestions, but the role of the buyer’s agent has largely shifted from curator to advisor.
As a seller, all you have to do is get your property listed on the local MLS, and from there it will be populated onto huge real estate websites like Realtor.com, Zillow, and Redfin, which get millions of visitors a month. That means that the buyers who are interested in your property will likely discover it themselves – without an agent working as a middleman.
Selling a House without a Realtor Checklist
Selling a home without an agent means you’re taking on a lot of work for yourself. But it’s definitely doable, and demystifying how it actually happens can take away a lot of the pressure that comes with navigating the process yourself. Below is a basic checklist of the major steps in the process of selling a house without a Realtor; for the more complex steps, we’ll go into more detail in later sections.
Determine How Much Your Home Is Worth
Setting the right price for your home is one of the most important steps in the entire sale process.
The right price will get your sale off to a fast start, with plenty of interest pouring in, and an impressive final sale price. The wrong price will actually repel buyers from your home, and data from Zillow shows that the longer a property sits on the market, the less likely it will sell for the list price – meaning a bad pricing strategy could actually send your home into a downward spiral that ends in a lowball offer (or no offer at all).
So how do you discover the right price? One common mistake that FSBO sellers make is to price their home according to what they think it’s worth, or what they want it to be worth. An important lesson here is that a property doesn’t have a “true” or “objective” value – there’s only what the market will pay. So to determine what your home is worth, you should look at similar properties that recently sold.
That’s exactly what a comparative market analysis (CMA) does. An agent usually provides this to sellers, but you can commission one from a private service for a few hundred dollars. It will look at homes with similar features as yours, in similar neighborhoods, that sold in the last 6-12 months, and use those to estimate a range of potential prices for your home. Depending on your local market conditions, you’ll want to price your home somewhere in that range.
Prepare Your Home for Sale
Next you’ll want to get your home ready for public viewing. Start with the basics – declutter (experts recommend removing at least half your furniture) and do a deep clean. Next, consider any repairs or renovations your home might need, but make sure that you only choose the ones with a good return on cost.
Don’t forget curb appeal. Most buyers make up their mind about a home within eight seconds of seeing it, so make sure it makes a great impression from the curb.
If your home needs staging, you can hire a professional home staging service, who will give the interiors a refresh, and even rent you furniture by the month, until your home sells. If you want to stage it yourself, you can research design blogs and home staging guides to learn what buyers do and don’t want to see in a home.
Here are a few that we can recommend:
ArchDaily: This site showcases cutting edge interiors and materials from around the world. Best for high-end finishes and the aesthetically adventurous.
Style by Emily Henderson: This blog addresses everything from sconces to bath towels, and even has a section that goes into the most common interior design mistakes— and, more importantly, how to fix them.
Chris Loves Julia: This site, run by a husband and wife duo, features the latest design trends and, unlike many blogs, actually tells the reader where to buy the furnishings and finishes they showcase.
Psychological Staging: This home staging guide, written by an established interior decorator, features inexpensive ways of maximizing your home’s appeal. One review claims her tips helped them increase their home’s sale price by thousands of dollars.
Styled: Secrets to Arranging Rooms, from Tabletops to Bookshelves: With 520 reviews on Amazon, this book is a proven guide to making any space more inviting.
Market the Home
An agent lists your home on the local MLS and uses their professional network to spread the word about your property – this attracts a lot of eyeballs to your home and whips up a lot of interest. You’re now going to have to do all the work yourself.
A great start is to get your home onto the local MLS. That database is only open to licensed agents, but there are flat fee MLS services that, for a few hundred dollars, will get your home onto the MLS. From there, it’s populated onto the big websites like Realtor.com and Zillow where it’ll be viewable by potentially millions of buyers.
As long as you’re selling without an agent, you should continue to think outside the box. Post ads for your home on social media accounts, list it on Craigslist, and reach out to local real estate blogs. You want to cast as wide of a net as possible, because the more interest you can attract, the higher your final sale price is likely to climb. And don’t forget the humble yard sign! You never know when a potential buyer might drive by.
Negotiate Offers
Once you have a few offers come in, you’ll have to go to the negotiating table. This can be one of the most difficult phases of the sale for unagented sellers, since they’ll be negotiating with the buyer’s agent, who’s been through many sales before.
Mostly, it’ll come down to how much interest there is in your home. If you have multiple offers, you’ll have most of the leverage, and you won’t have to make many concessions. But if you only have a single offer (or a bunch of low ball offers), and your home’s been on the market for a while, you could get squeezed.
Gather Closing Paperwork and Finalize the Deal
There’s a lot of paperwork required to close a real estate transaction. Without an agent, you’ll have to make sure your paperwork is complete and legally compliant; many experts recommend that FSBO sellers retain a real estate lawyer for this phase of the process, just to make sure everything’s in order. If your paper is incomplete or improperly filled out, there could be serious legal or financial consequences.
The Best Websites for FSBO Home Sellers
There are a number of websites that help FSBO sellers get their property out there in front of buyers, and across the finish line of the sale process, but these five offer the best value.
For Sale By Owner
Founded in 1999, this site claims to have the most traffic of any FSBO-related platform, so it’s a great choice for sellers who are just trying to reach the largest audience possible.
Basic listings here are free, while for $399, sellers can upgrade to a package that includes all legal forms, pricing tools, and more.
FSBO.com
This popular site offers two main levels of services. For $99.95, sellers get a 12 month listing that includes unlimited photo and video uploads, a custom listing on FSBO.com, and a custom listing on Redfin.
Their next tier of services, priced at $399.95, includes everything above plus listings on Zillow, Realtor.com, and, crucially, the MLS. In a sense, FSBO.com is a hybrid flat fee MLS service, offering an MLS listing plus other services.
Sellers who opt for this package should note that it offers a standard Realtor commission of 3% as part of its terms.
FSBO.com is a great choice for sellers who want to lean into video, and who want their listing to appear on the MLS— but also want more services than the typical flat fee MLS service may offer.
Zillow and Trulia
Zillow has one of the most heavily-trafficked real estate websites on the web, and massive name recognition. That alone makes it a great choice for sellers who want the comfort of working with an established brand. While Zillow doesn’t offer a lot of peripheral features like yard signs, they do offer the prestige of a full listing on Zillow, complete with a Zestimate – Zillow’s proprietary home value estimate.
Loopnet
Loopnet’s primary focus is on commercial and investment properties; FSBO homes listed on Loopnet actually appear on CoStar, an affiliated real estate site. Listing on Loopnet is free if you use a basic listing; for a more in-depth custom listing, they charge a premium rate, which will be determined in a one-on-one consultation.
Since they’re focused on commercial and investment properties, Loopnet listings offer features not available from the other sites on this list, like a cap rate. Loopnet listings often offer owner financing too, so overall, this is a great platform for commercial and investment properties, as well as businesses.
Craigslist
Most people have used Craigslist before in some capacity; it’s the ninth-most visited website in the U.S. If you have, you know it’s basically the Wild West – free, and filled with everything from used sofas to personal ads.
Craigslist has a section for home sales too, and since it’s free to use, FSBO sellers should list their property there. It’s a very high traffic platform, and it costs nothing. Still, Craigslist’s random, unfiltered user base means that it should be a supplemental listing – not your primary platform. Your main listing should appear on one of the other sites on this list, that focus mainly on real estate.
Paperwork for Selling a House Without a Realtor
One of the most challenging tasks for a FSBO seller is gathering all the necessary paperwork involved in the transaction. Here’s a checklist of the main documents you’ll need for your sale – but make sure you consult your state and local regulations, as requirements can vary based on location.
The Original Sales Contract
This document shows the chain of ownership from the previous owner(s). It lists the previous sale price, which your buyer will be interested in, and all the disclosures. You should study these to make sure you don’t leave any mandatory disclosures out.
Property Survey
The survey shows the exact legal boundaries of your property. The buyer’s lender will probably order a new survey, but having this information on hand is useful for you and the buyer.
Certificate of Compliance
This document simply states that your parcel of land exists, in a legal sense, and is in compliance with local property laws. Note that this does NOT address zoning or building rights, only the legal existence of your lot.
Mortgage Documents
You’ll have to pay off your current mortgage with the proceeds from the sale; your latest mortgage statement will give you a pretty good idea of how much you owe, while a payoff amount form, which your lender is legally required to produce upon request, shows exactly how much you’ll have to pay, including fees, penalties, interest.
Tax Records
The tax basis of your home will be below its market value, especially if your property hasn’t been professionally appraised recently, but it will give you a good idea of your property’s approximate value at the time of the last appraisal, or at least its present-day price floor.
Professional Inspection/Appraisal Results
The inspection report identifies any problems with your home, while the appraisal is an estimate of its market value. Together, they paint a picture of your home’s condition and value – important information for setting your home’s price, and engaging in negotiations.
Receipts for Maintenance and Home Improvements
Buyers will want to get a sense of your home’s maintenance demands and schedule. And they’ll also want assurances that any home improvements or additions you’ve had done were properly permitted and are up to code. If they aren’t, there could be an issue with back taxes or repairs.
Manuals and Warranty Information
Buyers will want any user manuals and warranty documents for appliances that go along with the property, as well as things like HVAC systems.
HOA Documents
If your property is governed by a homeowner’s association, the buyer will need to review the regulations and dues before the sale is finalized.
Utility Bills
Buyers generally like to see a year or two of past utility bills, to get a sense of what kind of expenses they can expect.
Comparative Market Analysis
A comparative market analysis (CMA) compares your home to similar homes that recently sold, and is the single best tool to help you set the price of your home— even more valuable than the appraisal, since it’s market-based.
Seller’s Net Sheet
The seller’s net sheet is simply a way for you, the seller, to keep track of all your expenditures, and project how much you might clear from the sale. You’ll want to fill out a new seller’s net sheet as you receive different offers, and as you negotiate the price.
Preliminary Title Report
This document addresses any outstanding liens, tax bills, or other financial obligations attached to the property.
Seller’s Disclosures/Mandatory Disclosures
These forms address items you should disclose – like noise issues, neighbor disputes, etc.– and items you’re legally required to disclose like lead-based paint, asbestos, and other environmental issues.
Purchase Offer
This document records the buyer’s offer and the terms of the deal. If you negotiate the price up or down, those changes will be made to the purchase offer, too.
Home Inspection Report
Once the purchase agreement is signed, the buyer will have the property inspected. The inspector will look for flaws and produce a detailed report on the property.
Appraisal Report
The buyer’s lender will order an appraisal to make sure the home is actually worth the amount of money being lent to the buyer. The seller doesn’t automatically receive a copy of the appraisal but can request one from the lender.
Final Purchase Agreement
This document records the final sale price and terms of the deal. This is drawn up by the agents and attorneys after negotiations are complete.
Most Recent Tax Statement
Sellers are responsible for property taxes right up to (but not including) the day of closing. Their most recent tax statement will help calculate exactly how much they owe – or, if their locality pays property taxes in advance, how much of a refund they’re entitled to.
Closing Statement
Think of this as the final form of the seller’s net sheet. It simply calculates the seller’s net proceeds according to the final price and terms of the deal. This is usually supplied by the closing agent or the title company.
1099-S Tax Form
If your profits from your home sale exceed your capital gains tax exemption, you’ll need to fill out this form to determine how much you owe the IRS.
Deed
This document confers ownership of the property on whoever holds it. Once you hand it over to the buyer, the property is officially theirs. Congratulations!
Breaking Down the Average Closing Costs Without Using a Realtor
The average closing costs for a seller come to about 10% of the final sale price. Of course, that’s assuming they pay the conventional 6% real estate commission. If you’re selling without a Realtor, you’re going to reduce that significantly— though not eliminate it entirely.
Let’s go over some of the most common closing costs for sellers, and come to a rough average for total costs when you go FSBO.
Real Estate Commission
At 6% of the final sale price, commission is the largest single cost for sellers, and makes up a majority of total closing costs.
Selling without a Realtor means you’re eliminating the 3% listing fee you’d pay to a listing agent. However, unless you sold to a buyer without an agent, which is relatively rare, you’ll still be responsible for the 3% buyer’s commission.
A 6% commission for a home that sold for the U.S. median value of $252,000 comes to $15,120. Selling without an agent gets you off the hook for half that, so you’d still have to pay $7.560.
The FSBO equation looks a lot different when you take into account that you’re not eliminating commission, but only cutting it in half. And in order to get that 50% savings, you’re giving up a whole lot of services that you’re going to have to replace with your own labor.
The ideal is to cut your costs while still retaining the expertise of an agent, and our partner Clever Real Estate offers exactly that. They connect sellers with pre-vetted elite agents in their area, who’ll sell your home for a flat fee of $3,000, or 1% if your home sells for more than $350,000.
That’s a more than 50% discount on your listing fee, for the same full service, top of the line sale experience you’d get if you paid thousands of dollars more. Contact Clever today for a free, no obligation consultation!
Title Search
The title search simply determines whether there are any outstanding liens, debts, or other claims attached to your property.
A title search generally costs $200-$400.
Title Insurance
Title insurance covers anything that might have been missed by the title search.
Average costs for title insurance range from $1,000 to $4,000.
Escrow Fee
This is a fee paid to a title or escrow company for paperwork and escrow services, including the handling of earnest money.
The escrow fee is generally around 1% of the final sale price, but it’s split between buyer and seller. So the seller of a home priced at the U.S. median value would be responsible for paying around $1,260 for their half of the escrow fee.
Transfer Tax
Most local governments charge a fee for transferring a property from one owner to another. This can vary widely depending on location; transfer taxes can run from a few hundred up to several thousand dollars.
Miscellaneous Fees Owed
The seller is responsible for costs like utilities and property taxes right up until the day of closing, so these will have to be figured and paid at closing. Like transfer taxes, these costs are highly dependent on location.
Marketing
One of the main duties of a real estate agent is to get your property out in front of an audience of potential buyers; that can cover everything from spreading the word through their professional network to putting up yard signs and fliers.
As a FSBO seller, that’s now your responsibility. Your marketing efforts could encompass everything from buying online and print ads, to putting a “For Sale” sign in your front yard, to listing your home on Facebook.
Attorney Fees
A real estate agent will review your paperwork and make sure it’s complete and properly filled out. If you’re not working with an agent, it’s highly recommended that you hire a real estate attorney to review your paperwork.
Real estate attorneys charge either a flat fee, or an hourly billable rate; typical attorney costs for a simple buy/sell transaction are $2,500 to $3,000.
Total Closing Costs for Sellers Without an Agent
If we tally up these average costs, the numbers look like this:
- Real estate commission: $7,560
- Title search: $300
- Title insurance: $2,500
- Escrow fee: $1,260
- Transfer tax: Varies
- Miscellaneous Fees: Varies
- Marketing: Varies
- Real estate attorney: $2,750
Total: $14,370+
Selling a home is an expensive venture; even if you can halve your real estate commission by selling without an agent, you’re still likely going to pay in the low five figures for closing costs.
Why Should You Use a Realtor?
As the numbers above show, selling a home is expensive – with or without a Realtor. An unagented sale will save you a listing agent’s commission, which comes to a little over $7.500 if you’re selling a home near the U.S. median value. That’s not an insignificant amount of money – but in the context of total selling costs, and considering what you’re giving up by not using an agent, it’s a little less compelling.
Think of it this way: selling without an agent saves you from having to pay listing commission, but you’re also taking on marketing costs, conducting open houses, and will have to consult a real estate attorney to make sure your paperwork is in order. And that’s not even taking into account your time.
Together, those costs will seriously eat into whatever money you’re saving by going FSBO. The back of the envelope math looks something like this: while you’re saving $7,500 on commission, you’re also paying out around $3,750 in attorney fees and marking costs, plus whatever other miscellaneous costs you decide to take on.
Then there’s the issue of price. Data from the National Association of Realtors (NAR) shows that FSBO listings sold for an average of $200,000, while agent-assisted listings sold for an average of $280,000. That $80,000 price gap dwarfs any prospective savings you might get from selling FSBO.
Alternatives to Selling Without a Realtor
When you look at the big picture, it’s not necessarily how much an agent costs, but how much value they provide for that money. In a lot of cases, agents earn their commission – and then some – just by negotiating the final sale price above and beyond what an inexperienced FSBO seller could’ve negotiated. For homeowners considering an FSBO listing, think hard not just about whether you can do everything an agent does, but how well you can do it.
That being said, just because real estate commission can be a good value, doesn’t mean that you shouldn’t try to reduce it as much as possible, if you can do so without giving up vital services. The ideal bargain is to get a full service, top of the line sale experience for less than the full 6%.
That’s exactly what Real Estate Witch partner Clever Real Estate offers. Clever pre-negotiates lower commission rates with top agents in your area, who’ll put their expertise to work selling your home for a flat fee of $3,000, or 1% if your home sells for more than $350,000. That means you’ll get everything you can expect from an elite, top-of-the-line full service agent, but for a fraction of the price. Contact Clever today to find out what they can do for you!
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