A question from a reader for our resident Realtor (who happens to be Carrie’s husband):
We are considering selling our lot versus rebuilding after the fire. My husband mentioned the possibility of selling it ourselves instead of using a Realtor. Neither of us has any real estate background. What do you think of this idea? Is selling a lot simpler than selling a house?
So is it “easier” to sell a lot than a home? That depends on what you mean by “easier” – yes, there is probably less work in terms of marketing tasks (e.g. You don’t need 25 Wide-angle HDR photos), but at the same time it is often harder to to find buyers for lots than for existing homes. Considering that even the majority of for sale by owner homes don’t sell, you may be fighting an uphill battle with a lot.
Let’s back up for a minute and look at how much you’ll save by not using an agent. I don’t know your address, so I have no way to value your lot, but let’s just say that it’s worth $100,000 for the sake of discussion. (Many of the lots that were affected are actually worth much less than this.)
Now let’s say that an agent charged 6% to list that lot, and half of that (3%) is what they will pay the buyer’s agent as the “cooperative commission”. If you do choose to list your lot on your own, you’d be wise to still offer a cooperative commission to potential buyer’s agent or else you will further reduce your pool of buyers. With that in mind, your only savings is the 3% that the listing agent keeps.
So the question is, is it worth $3,000 to have a listing agent to help market your home, advise you on the various aspects of the transaction (do you know what the lot might be worth?), and generally facilitate the transaction? More importantly, would the additional marketing actually help sell your lot for at least $3,000 more than you would have sold it for on your own? In most cases, the agent pays their own commission when you look at it this way.
There is one more thing to consider as well. Do you plan to purchase another home in the area? Many agents, myself included, will offer some sort of a credit to you when you have two transactions. In my case, I typically offer the credit on the second transaction. This means that while you’d still pay the commission on the front end, you’d actually recoup part of that on the purchase transaction which further reduces the net cost of listing your lot.
Jeremy Isaac is a Colorado Springs Realtor, but you probably know him better as Carrie’s husband. If you’ve got a question to ask, shoot him an email at firstname.lastname@example.org.
You can search the Colorado Springs MLS on Jeremy’s website, with no registration required to view homes, prices, addresses, or any other information. If you’re looking to sell your home, be sure to view his marketing portfolio and see how the use of HDR photography, professional video, and more will help your home quickly sell for top dollar!