The real estate industry has gone through so many changes over the last 15 years. One of the most significant is the agent who really sells your home. Back in the day, before the internet was such a big part of business, you hired a listing agent to "sell" your home. Today, you hire a listing agent to market your property and act as your advisor but typically, it is actually a buyer's agent that is going to "sell" your home. In Red Deer in 2011, 88%* of the houses that were sold were NOT sold by the primary agent whose name was on the listing. So we can conclude from this that when you hire an agent to list your house, it is likely going to be a different agent that is going to bring you the buyer. In Central Alberta, buyers can "hire" a buyer's agent and it doesn't cost them anything because the seller is paying the commissions. This is one of the reasons why a buyer's agent has become so popular for buyers these days, there is no direct cost to the buyer.
The buyer's agent has changed the dynamics of the industry which brings me to the point of this article. The best way to sell your house is to make it easy for a buyer's agent which in turn, makes it easy for the buyer. In a society where we all have busy lives with limited time, complicating the buying process for an agent and their client is going to have a negative impact on your ability to sell. This is where I feel for sale by owner companies (FSBO's) are at a disadvantage over real estate agents even though they now have access to MLS® or www.realtor.ca
. The realtor.ca website is just one of two very important pieces to keeping things simple for a buyer and their agent. What FSBO's are missing is the system we have created between agents which is the use of lockboxes, the systems in place for requesting a showing time, pre-determined commission amounts & explanation of Agency as it relates in Alberta. I have heard many consumers say that real estate agents "boycott" FSBO properties but this is not the case at all. In fact, many of us agents are happy to show FSBO properties, it just becomes more complicated for the buyer's agent and their client. Here is an example of the differences between booking a showing with a property listed by a real estate agent and a property listed privately.
A Property For Sale via A Real Estate Agent – A buyer's agent sends a text to the listing agent to request a showing time for a one hour period. Listing agent contacts seller to confirm time is okay. Listing agent texts back the buyer's agent to confirm they are ok to show. Buyer's agent shows up at the property in the one hour time slot that was booked, seller is not home, agent opens the house with access via a lockbox, shows the property to their client, discusses the property while they are doing a tour of the home, locks the house up, returns the key or code to the lockbox and continues on to the next showing. If the buyer decides to write an offer, the buyer's agent drafts the offer, sends it to the listing agent and awaits a response.
A Property For Sale by the Owner – A buyer's agent calls the number that is on the ad and waits for the seller to respond. This could take one hour or it could take 3 days depending on the motivation of the seller and how busy their lives are. If it takes more than a day to get a response from the seller, it is likely that the buyer will instruct their agent to strike it off the list because the buyer is busy and only has times on certain days to view properties. If the seller responds quickly, the buyer's agent must make arrangements for access to the property which either requires the seller to be at the house for the showing or other arrangements have to be made for the buyer's agent which could involve picking up a key and dropping it back off. If a time can be worked out with the sellers schedule and the buyer's schedule, the buyer's agent meets his client at the property. Usually the seller wants to trail along with the buyer's agent and the buyer which makes the buyer feel uncomfortable and limits the conversation the agent and their client can have. If the buyer decides to write an offer, here is where things get complicated. Not only does the buyer's agent draft up the offer but a multitude of other paperwork has to be sent to the seller including a brochure and acknowledgement form on Agency relationship and a seller customer status acknowledgement and fee agreement. The Agency form is especially important given the seller has no representation; the seller must understand the buyer's agent is not legally obligated to the seller. Not only is the buyer's agent negotiating an offer on the property, there is usually negotiation on commissions which would involve both the buyer and the seller.
As you can see from these two examples, the process is much more complicated when dealing with a FSBO listed property versus a property listed with an agent. Given that most buyers are choosing to work with a buyer's agent these days (personally I think you are crazy not to have an agent represent you when you buy) then it is my opinion that you should keep things simple and list with a real estate agent that makes things as easy as possible for a buyer's agent.
* Based in whole or in part on information provided by the Central Alberta REALTORS® Association for the period January 2011 through December 2011 for single family, half duplex, townhouse & condo properties in Red Deer, AB.