The real cost of selling your home for the average american family based on our estimates can exceed 20% of their home equity, when taking into consideration their initial cash outlay (downpayment) when a traditional licensed real estate agent is used. It’s substantial and unnecessary with over $60 billion in fees being taken from families on a national basis from the real estate brokerage industry.
For example, if someone purchased a home for $300,000, put 10% down they invested $30,000 outside of other closing cost associated with buying this property. To keep things simple, let’s assume the home increased by 5% in value over two years, or $315,000 and the owners wanted to sell and more importantly, were able to get fair market value so closed at $315,000. If they used a traditional real estate agent at 6%, that’s $18,900 in total commission, or 42% of equity taken away from them. They would have approximately $45,000 equity ($315,000 – $270,000 = $45,000) and the real estate agent’s commission represents 42% of this total that is being stripped away. The 6% commission fee is really 42% of equity lost.
These numbers our staggering and in today’s market, there is no reason why anyone should pay a full commission. With a 6% commission in most markets, half is retained by the listing agent and half is shared with a buyer agent, which over 80% of homes do not sell with the listing agent. At company’s like DwellOwner, we offer an opportunity for a home seller to save on the sell side commission, by not paying the full percentage. On average, our clients save 3% of the sales price of their home or in the above example, 21% of their hard earned equity.
The real estate industry has created several myths and tactics to try to convince home sellers they need a traditional agent, which are false. At DwellOwner, we are offering a full service sell-side offering for home owners with a mission to save the industry billions in commission expense.
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