Call it the $11,076 question. That’s how much typical Realtor commissions amount to on a typical U.S. home selling for $184,600, the number Zillow pegs as the median home value.
Move the question to San Francisco, or prime New York City, and the number vaults up to maybe $50,000 or more.
That dough is prompting more sellers to ask: can we cut out the Realtors?
Factor two is that Internet sites - including Zillow - have put a world of information about homes for sale in the hands of every seller and buyer. From a house’s property taxes to its most recent sold price, all that info is a few clicks away - as is an avalanche of data about comparable homes. Ten years ago, a seller really needed a realtor’s help in pricing and getting a home on the market. Nowadays not so much.
But the real reason the question is getting asked is factor three: the inventory of homes for sale is shallow in most of the country. In Atlanta, it’s about half the number it would be in a healthy market. In Seattle, the shortage has reached alarming lows. In northern Virginia, there are Washington Post headlines about “ lack of inventory.” In markets with little inventory, homes generally sell very quickly - often within a week or two of going up for sale.
San Francisco is an outlier - inventory is up 40% over a year ago - but prices there have hit breathtaking levels. In much of the country, inventory shortages rule, and that is what is prompting more sellers to ask if they really need a realtor to sell.
Of course, It’s perfectly legal to sell a house in a so-called FSBO (for sale by owner) transaction. Right now, only 8% of homes are sold that way, according to numbers from the National Association of Realtors (NAR). But that number is ticking up. Sissy Lappin, co-founder of ListingDoor.com, a company that helps homeowners do FSBOs, said that the number of FSBOs had “doubled” in the past year in several areas that she investigated.
That makes sense in today’s hot market.
But there’s another side to this. Peter Hernandez, founder of real estate firm Teles Properties in Los Angeles, said he’s heard that “we don’t need a realtor because the market is so hot” argument - but it doesn’t hold up. He sighed: “This thinking is faulty because they don’t know what they don’t know.”