Realtors work with their clients to help them find their ideal home. A good realtor helps you save money on your home purchase but they can only do so much. Even the best realtors will cost you, generally 5-6% of the purchase price of your home. You’re probably wondering as you read that if a realtor is worth what they charge, and you are not alone. Every year about 10-15% of homes purchased in the United States are purchased without a realtor. That might sound like a tantalizing option for you but there are some real risks you need to consider first.
Risks You Need To Consider
A real estate agent serves as your representation through the buying process. If you choose to go it alone you need to realize it will be up to you to advocate for yourself. Also remember that the sellers agent will aggressively bargain on behalf of their client, and they start out with the upper hand. Here are some of the risks you need to consider if you choose to buy without a realtor.
- Paperwork. There is gobs of paperwork involved with the purchase of a house, and without a agent it is up to you to fill out. It is extremely technical so enlist help if you must. You can hire a real estate lawyer for a small fee to help.
- Time. Without a realtor your purchase is going to take longer. You’ll need to research and learn how to complete the process yourself. Be prepared to be patient.
- Neighborhood knowledge. Realtors are experts on the neighborhoods they sell in. Working with one can keep you from buying a house in the wrong part of town. If you choose to buy without a realtor make sure you research neighborhoods.
- Negotiating. Your realtor is also your negotiator and without them you have to strike the deal. The person you buy from will likely have a realtor and they will negotiate hard. Be ready to say no and walk away if needed.
- Inspections. If you choose to go it alone you need to make sure you know what inspections you are entitled to. You want to know the condition of the house you are purchasing. If you don’t ask the seller may not disclose issues with the home so insist on an inspection.
Benefits Of Ditching A Realtor
We’ve talked through the risks of going it alone, but what’s in it for you if you go it alone? There are a surprising number of positives to choosing to be your own realtor.
- Savings. This is the first and foremost reason to fly solo, to help your bottom line. If you and the seller can both agree to forego using agents that 5-6% commission will stay in your pocket. With the availability of information about real estate you can feel more confident buying for yourself.
- Negotiating. Negotiating power is both a pro and a con for going without a realtor. If you fancy yourself a tough negotiator you’ll get to interact with the seller directly and get a read on them. Leverage is easier to utilize when you are doing the negotiating face to face rather than through a realtor.
- Client Of One. Your realtor has to juggle multiple clients, not the case if you are your own agent. You control the process and progress is in your hands.
Choosing to buy a house without a realtor is a gamble that can pay off. Make sure you are confident in your own abilities and put together a list of resources to help guide you. If you need suggestions here are a few to get you started.
Zillow.com-Real estate listing website. Their “z” estimate can help you see if properties are priced appropriately.
Trulia.com-Another property listing site that can help you keep up to date with new listings. You can also sign up for alerts to be notified when new properties in your area/price range become available.
Realtor.com-Ironically one of the best websites to help you buy a house realtor free.
Anyone have any experience buying without a realtor? What was your experience?