For Sale By Owner and the Changing Commission Landscape

FSBOs and the Changing Commission Landscape: Why Partnering with an Agent Saves You More

Selling your home as a For Sale By Owner (FSBO) is often an appealing choice for homeowners looking to avoid paying real estate commissions. After all, the idea of saving thousands of dollars in fees can feel like a win. However, the real estate landscape shifted on August 24th, bringing changes to commission laws designed to add transparency to the process—and, ironically, making it even clearer why partnering with a professional agent remains a wise decision.

Here’s what has changed, how it impacts you as a seller, and why working with a real estate agent could save you money in the long run.

The New Rules on Commissions

Recent changes to real estate commission laws require more transparency regarding how commissions are disclosed and negotiated. As of August 24th, buyers and sellers are better informed about how agents get paid, often debunking misconceptions about excessive costs. These changes aim to make the process clearer for everyone, but they also emphasize the value that a knowledgeable agent brings to the table—particularly when it comes to negotiation and pricing strategies.

While FSBO sellers often aim to save on commissions, studies show that this upfront "savings" can cost more in the end. Here's why.

FSBO Homes Sell for Less: The Numbers Don’t Lie

According to research from the National Association of Realtors (NAR), FSBO homes sell for an average of 9% less than homes listed with an agent. That’s a staggering difference when you consider the potential equity you could lose. For example:

• FSBO Sale: A home priced at $300,000 may sell for $273,000 without professional representation.
• Agent-Assisted Sale: Even after paying a 5-6% commission, you could walk away with a higher net profit.

The reality is that agents have the tools, market knowledge, and negotiation skills to secure top dollar for your property—far more than you might achieve on your own.

Why FSBO is Understandable—but Risky Without a Strategy

Selling your home yourself makes sense in certain situations. Maybe you’ve already found a buyer, or you’re confident in your ability to handle the complexities of the sale. But it’s essential to have a backup strategy to ensure success if things don’t go as planned.

Here’s where FSBO sellers often struggle:

1. Accurate Pricing: Without access to comprehensive market data, it’s easy to overprice or underprice your home.
2. Marketing Reach: Agents have access to MLS listings and extensive networks to showcase your home to qualified buyers.
3. Negotiation Expertise: Real estate transactions involve multiple parties, contracts, and legalities—an agent ensures your interests are protected.

Adding Value with an Agent: A Winning Partnership

If you’re considering FSBO, think of an agent not as an expense but as an investment in maximizing your home’s value. The key is finding a real estate professional who can complement your efforts, stepping in to assist when needed.

Here’s how partnering with an agent adds value:

• Comprehensive Marketing: Your home gets maximum exposure to the right buyers.
• Expert Staging Advice: An agent can suggest improvements or staging tips to increase your home's appeal.
• Negotiation Power: Agents are trained negotiators who can secure the best possible price for your home.

Have a Strategy for Success

Choosing FSBO doesn’t have to mean going it alone. Have a plan in place to evaluate your progress, and be ready to pivot if necessary. Many FSBO sellers start strong but eventually turn to an agent when the process becomes overwhelming or results fall short. By partnering with an agent early—even in an advisory role—you can set yourself up for a smoother, more profitable sale.

Bottom Line: Saving Money Is About Net Profit, Not Just Commissions

The August 24th commission changes highlight one undeniable truth: transparency in real estate empowers sellers to make informed decisions. But skipping an agent to "save" on commission could cost you far more in the long run when your home sells for less than its true market value.

If you’re planning to sell FSBO, that’s understandable—but make sure you have a strategy in place. When the time comes to maximize your home's value, a real estate professional can be your greatest ally.

Ready to discuss your strategy or learn more about how I can help? Let’s chat!