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The advantages of using an agent

Around 89% of sellers recently sold their home through a real estate agent or broker, which is up 2 percentage points since last year, according to the 2023 NAR report. The frequent hiring of real estate agents is a reflection of the heavy lifting required in the complicated and stressful process of selling a home, according to Lautz.

“Sellers are relying on their agent to tell them: What can I price my home? How can I attract a buyer? How should I fix up my home for sale?” she said.

Plus, agents do all the marketing for a home sale. NAR reports that 41% of buyers view homes online before taking any further steps, so a good online presence for your home is a must. Real estate agents typically handle listing your home on a multiple listing service, and can take on the task of staging your home and taking high-quality photos. If they have a strong social media presence, they can also post details on their accounts to attract more buyers.

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Why you may want to ditch your agent

Though real estate agents can be a huge help, they also come at a cost. The nationwide average commission for a real estate agent is 5.45%, according to Clever, a platform that matches buyers and sellers with agents. This means that if you sell your home for $400,000, the agent (or agents) could take a $21,800 cut. Bear in mind, if a buyer uses their own agent, the commission is split; however, some seller agents may offer a deal on the commission if they bring in the buyer themselves.

Of course, if you sell your home yourself, you don’t pay any commission. That’s an enticing reason not to use a real estate agent.

But when people sell their homes themselves, they tend to know the person they’re selling to, according to the NAR report. Among recent FSBO sellers, 57% knew the buyer personally. For 70% of these sellers, the most important reason for selling was their relationship with the buyer. Plus, if you’re selling your home to a relative, a close friend or even an old neighbor, you may not feel the need to include a middle-person.

Are the commission savings worth it?

Around 50% of FSBO sellers who did not personally know their buyer sold their home without the help of a real estate agent to avoid paying a commission or fees, the NAR report says. But did these sellers actually save money by selling their home this way?

On the surface, it would seem hiring an agent is worth the commission. The median selling price of FSBO homes in 2022 was $310,000, while the median selling price of a home where the seller hired an agent from the outset was $405,000, the data shows.

But that doesn’t tell the whole story.

Far more FSBO homes sold were in small towns (32%) and rural areas (30%) than homes sold with the help of an agent (18% and 13%, respectively). Meanwhile, only 27% of FSBO homes sold were in subdivisions and suburbs compared to 49% of agent-assisted home sales. Around 15% of agent-assisted home sales were in urban and central cities compared to 6% of FSBO homes sold.

Prices can vary depending on location, and unfortunately the report doesn’t cross-reference home sale prices with the type of location the home was sold.

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Is there a middle ground?

What if you don’t love the idea of paying a commission, but you’d also like some help with pricing your home or the legal paperwork involved in selling.

“Buyers and sellers do want representation in the process, as they're making them the best financial transaction of their life,” Lautz said.

Good news: there is a middle ground. You can still work with a real estate agent and haggle over the commission and any fees. If a client initiated the topic of compensation, agents were willing to negotiate 19% of the time, according to the NAR report — 15% of the time sellers were unaware they could negotiate commissions and fees.

Feel free to ask your real estate agent about negotiating their compensation. It may mean taking on some services, such as home staging, from them, but you could save money. It’s your home and your money, after all.


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About the Author

Sabina Wex

Sabina Wex


Sabina Wex is a writer and podcast producer in Toronto. Her work has appeared in Business Insider, Fast Company, CBC and more.

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The content provided on Moneywise is information to help users become financially literate. It is neither tax nor legal advice, is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. Tax, investment and all other decisions should be made, as appropriate, only with guidance from a qualified professional. We make no representation or warranty of any kind, either express or implied, with respect to the data provided, the timeliness thereof, the results to be obtained by the use thereof or any other matter.