For-Sale-By-Owner Homes Were 10% of Sales in 2022. Should You Sell Your Home Yourself in 2023?

To hire an agent or not to hire an agent… that is the question.

If you're planning to sell your house this year, you may be wondering if you actually need to hire a real estate agent to do so. Many sellers felt just like you in 2022. In fact, the 2022 Profile of Home Buyers and Sellers by the National Association of REALTORS (NAR) found that 10% of home sales last year were FSBO (For Sale By Owner), an increase over 2021 (7%).

The data on these sales in NAR's report is pretty interesting. FSBO homes are more common in rural areas (13%, versus 6% in suburban areas), and half of the sellers knew the person who bought their home. They also walked away with less money, though -- the median FSBO home went for $225,000, significantly less than the median sale price for a home sold with an agent, $345,000 (though rural versus suburban home prices also help explain the difference).

Now that we're armed with this information, let's take a look at what to know about selling a home on your own.

FSBO may save you money

The main reason a seller would choose to forgo hiring an agent is to save money. You'll generally be asked to pay 5% to 6% of your home's sale price to a real estate agent, and this can be a nice chunk of change indeed. For example, if your home sells for $350,000, and you're paying 5% of that to your agent, that's $17,500. I'd argue the cons that come with selling a home yourself outweigh your potential money savings, though.

But it might also cost you in other ways

If you choose to go it alone, you'll be responsible for all the aspects of selling a home. This includes staging it, hosting open houses, marketing, and all the paperwork. These are time-consuming and potentially stressful tasks. Plus, you won't have access to put your home on the multiple listing service (MLS) yourself, and it will be quite difficult to find as many buyers if you're not on it.

Finally, a local agent will know how to best price your home in your specific area, because this is what they do for a living. That experience can be invaluable, especially as you'll likely get more money for the home by using an agent.

Which is right for you?

I can't make that decision for you, but as you can see, you may end up with less money for your home if you sell it on your own, despite having to pay a real estate agent's commission if you hire one.

Consider your experience in the real estate world to decide (if this is your first time selling a home, it might be a good call to hire an agent to help), as well as how much free time you have to market your home. You could also pay a flat fee to a real estate agent to put your home on the MLS so more prospective buyers and buyers' agents will see it. Or, if you have a reliable buyer for your home already (someone you know), you might have an easier time selling it yourself. The choice is yours, but to FSBO or not to FSBO is a crucial decision that will impact how much money you make on a home sale (as well as how much stress you take on), so tread carefully.