A Clever Way You Can Save Money When Selling Your Home

published Jun 10, 2018
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(Image credit: Samara Vise)

As a savvy seller, you’ve spruced up the front yard to increase your home’s value and have been keeping an eye on how much homes are selling for in your neighborhood. You’ve done your research—so much, in fact, that you know exactly which day of the week is best to list your property. So, should you go full-on real estate star and try to sell your home on your own, too? Or, is it best to focus on boxing up your belongings and letting a real estate professional handle the sale?

For Sale By Owner (or FSBO) sales accounted for 8% of home sales in 2016, according to the latest figures from the National Association of Realtors. Here’s what you need to know before cutting out the middleman and selling your home on your own.

Pro: You don’t pay a realtor’s commission

Let’s be honest: Making as much cash as you can on the sale of your home is the main motivator in going this route.

“The primary advantage of selling a house on your own is to save on real estate agent fees,” says Lucas Machado, who has experience buying houses both on the MLS (multiple listings service) and those listed by homeowners as the president of House Heroes, a real estate investment firm. Depending on your market, commission ranges from 4-6%, he says.

Let’s run some quick math to show how much you could save by going the FSBO route, layering in the 4-6% commission range.

  • On a $150,000 home, a commission would range from $6,000 to $9,000
  • On a $300,000 home, a commission would range from $12,000 to $18,000
  • On a $600,000 home, a commission could range from $24,000 to $36,000


Some of the money you save on commission can be spent on home improvements, staging and advertising, points out Shane Lee, data analyst at RealtyHop, a real estate search engine.

Con: It takes time and skill—and a lot of both

If FSBO were an easy process, more people would be selling their homes this way.

For starters, a real estate agent will research local market conditions for your neighborhood like it’s their, well, full-time job. “This is about knowing how to set the price for your home by understanding your home, its conditions, features, and the current local market conditions for your neighborhood,” says John Bodrozic, co-founder of HomeZada, a digital home management site.

Real estate agents are also masters at marketing your home, which means getting it listed online, on social media and in brochures; optimizing the listing for Google; staging the home to make it attractive to buyers and making sure there’s high-quality photos to show off its features, Bodrozic says. Of course, there are scheduling open houses and setting appointments for showings, too.

Finally, real estate agents are skilled in contracts and closings, and knowing what can kill a deal, Bodrozic says. Among those closing snags are problems that pop up in inspections, title and insurance issues and home loans that fall through.

Also, homeowners may invest hope and time into someone who has no qualifications to buy their property, points out Susan Bozinovic, a realtor with Century 21 Town and Country in Northville, Michigan.

“Unlike real estate agents, sellers are unable to distinguish which buyer is a qualified buyer and which is a looker,” she says.

Pro: You can list your home right away

If you’ve got a hot property, you might be able to sell it fast on your own. “There are quite a few steps to take before selling a house with a realtor,” Machado says. “Interviewing agents, negotiating and executing a listing agreement, and developing a marketing plan—all this before you even begin selling. When you sell FSBO, you can cut to the chase and start evaluating offers.”

In the past, Machado points out, a big perk of selling with a realtor was access to the MLS and local housing data. Now, sellers can research local sales data online and list their house for free on certain websites. “For a few hundred bucks, you can also flat-fee list your house on the MLS,” Machado says.

You’ll also have flexibility of when you want to show your home and you can expertly answer questions about the neighborhood.

Con: Your buyer pool will be more limited

Another drawback is that buyers often do not want to deal with the owner, whether that’s negotiating prices or having the owner around when they’re viewing the house, Bozinovic says.

Also, the commission of a sale is usually split between the buyer’s and the seller’s agents. Since most homebuyers are working with real estate agents, there’s no incentive for those agents to show a home with no commission up for grabs. It’s possible a FSBO seller may need to offer a commission to the buyer’s agent who shows them the home.

Final Consideration

The National Association of Realtors surveyed FSBO sellers about what they found to the toughest tasks. Here are some of the top challenges they identified, so you know what you’re getting yourself into.

  • Getting the right prices for their homes (15%)
  • Selling within the planned length of time (13%)
  • Understanding and completing paperwork (12%)
  • Preparing and fixing up the home for sale (9%)
  • Having enough time to devote to all aspects of the sale (3%)