In many ways, it would seem logical for a real estate professional to sell their own home. After all, they possess extensive knowledge of the local market and have a deep understanding of the industry. The ability to effortlessly arrange impeccable staging, capture stunning photographs, and expertly host open houses naturally comes to them. However, this situation does give rise to ethical and legal questions.
Exploring the Feasibility of a Realtor Selling Their Own Home
So, can a Realtor sell their own home? The answer is technically yes. However, there are specific considerations to keep in mind to ensure a smooth process. Let’s delve into the details.
The Process of Selling a Realtor’s Own Home
Professional real estate agents, including Realtors who are members of the National Association of Realtors, can sell their own residence in the same manner as any other property. This involves listing it for sale through the usual channels, such as adding it to their local MLS (Multiple Listing Service).
“The typical real estate agent would post their property for sale through their brokerage and MLS,” explains Bennie D. Waller, Ph.D., a professor at the University of Alabama’s Alabama Center for Real Estate. “Depending on the broker/agent relationship, they may be able to list their property for little to no cost or avoid having to pay their broker a commission on the sale.”
Similar to any other home sale, the agent will need to navigate various tasks, including reviewing local comparable properties, determining the listing price, staging the house, coordinating showings and open houses, and reviewing and negotiating offers.
Important Considerations for Realtors
Before proceeding, it is crucial for Realtors to consider a few vital factors. All Realtors are bound by the National Association of Realtor’s Code of Ethics. Article 4 of this Code directly addresses Realtors who sell their own homes: “In selling property they own, or in which they have any interest, Realtors shall reveal their ownership or interest in writing to the purchaser or the purchaser’s representative.”
Even if an agent is not a Realtor, it is advisable to disclose that they are the owner of the property to potential buyers. Although disclosure laws may vary from state to state, being transparent serves to avoid unnecessary complications and maintain an above-board approach.
“Seasoned real estate professionals recognize the importance of their reputation and the significance of transparency,” emphasizes Waller. “It is essential that clients do not feel like their listing is competing with a property their agent has listed. Similarly, broker/agents need to be mindful of the time they allocate to marketing their personal properties without neglecting their clients’ needs.”
Weighing the Pros and Cons
Like any other situation, there are both advantages and disadvantages to a real estate professional selling their own home.
- Commission savings: In most home sales, the seller is responsible for paying the commission for both their agent and the buyer’s agent, which typically amounts to around 6 percent of the sale price, split between the two agents. However, when a Realtor sells their own home, they do not have to pay that fee, or at least not half of it, as they act as their own agent. In other words, they do not need to pay themselves.
- Leveraging expertise: “As local experts, agents know the market and may already have a client in mind when selling agent-owned properties,” Waller points out. Regardless, their in-depth knowledge of the neighborhood enables them to target ideal buyers effectively. Moreover, they can skillfully market the best features of their own home.
- Emotional complications: While real estate agents and brokers are accustomed to setting aside their clients’ personal feelings to optimize the transaction, doing the same when it comes to their own property might prove challenging. If they have a strong emotional attachment or nostalgic memories associated with the home, they may subconsciously perceive its value to be higher than comparable properties in the area.
- Potential neglect of clients: If Realtors devote too much time to their own listing, it is possible that their other clients may feel neglected. Even worse, prospective clients may seek out a Realtor who is not preoccupied with finding a buyer for their own property.
The Final Verdict
In conclusion, a Realtor can indeed sell their own home, provided they fulfill their ethical obligations and disclose to potential buyers that they are the property owner. However, successfully juggling the emotional aspects and demands that come with selling their own home while attending to their other clients’ needs may prove more challenging – but certainly not impossible.
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