In last week's post we talked about the sharp increase in apartment prices in Brooklyn and Queens. As residential property prices continue to rise in New York City, those who are thinking about selling their home must make a decision: should they use a broker or put the home on the market as a for-sale-by-owner offering? Each approach has its advantages and disadvantages.
The biggest advantage of going the FSBO route is avoiding the broker's commission, which is typically six percent of the sales price. On the other hand, residential real estate brokers will argue they can get a higher price for the property, offsetting the cost of the commission.
Selling an apartment on one's own is much easier today, due to the easy access to a wealth of information on the internet. Sellers can research comparable sales in their neighborhoods as well as checking up on the overall health of the market.
On the other hand, a good broker's negotiating skills can often land a higher sales price, especially in the final stages of negotiations. Brokers will also argue they know how to reach financially qualified buyers and line up financing. And residential property brokers in New York are often adept at helping buyers get approval from the condo or co-op board.
Some sellers who try the FSBO strategy end up hiring a broker when they realize how difficult and time-consuming the process can be. The right choice is different for each individual seller and will depend on the preferences, available time and skills of the sellers.
Source: New York Times, "The Broker-Free Sale," Jim Rendon, Sept. 26, 2013