Does a Seller’s Market Mean You Should Sell on Your Own?
There is some debate about when a “seller’s market” begins. Generally, economists and housing experts agree that four to six months of inventory (the amount of time it would take to deplete all available inventory) represents a balanced market where buyers and sellers have equal footing. Below four months creates a seller’s market, above six months represents a swing in the buyer’s favor. The truth is, four to six months is a pretty small window, but that range does indicate a trend that can be helpful in deciphering the market.
Right now in central Indiana, we have about 4.5 months of inventory and we have been in that four to five month territory for more than a year. So inventory is low and whether it’s technically a true seller’s market or not, it’s clear there are more buyers in the market than homes for them to buy.
So, it’s a great time for you to list. The question is, with this environment should you go it alone? In short, NO. Regardless of market conditions, there are certain truisms about FSBO (for sale by owner) transactions that always exist.
- Loss of negotiating power and expertise. If you sell without a REALTOR®, you personally must coordinate and negotiate with everyone – potential buyers, their agents, inspectors, appraisers…it can get complicated quickly.
- Marketing exposure. REALTORS® have immense resources to market your home, particularly online. More than 90 percent of buyers find their new home online. REALTORS® have access to dozens of sites.
- Return. Sellers may want to FSBO to save on REALTOR® fees. But guess what? Buyers know that and will use that to talk down the sales price. Studies have consistently shown that a REALTOR®-represented home sells for more than a FSBO. That’s no guarantee, but it is something to think through.
Of course the biggest consideration should be expertise. REALTORS® are professionals, it’s their job to market your home, obtain the best offer and handle all the details through closing.
For a related post on this topics, click here.