Here's What Happens When You Sell Your Home Without a Real Estate Agent

These days, sellers continue to have the upper hand in the real estate market. Even though buyer demand has waned on the heels of higher mortgage rates, sellers can take advantage of the fact that housing inventory is low on a national scale.

As of the end of March, there were only 980,000 housing units for sale across the U.S., reports the National Association of Realtors. That represents a 2.6-month supply of homes. And it normally takes up to a six-month supply of homes for there to be enough inventory to meet buyer demand in full.

If you're looking to sell your home, you may be thinking of doing so without the help of a real estate agent -- given that it's still a seller's market. But you should know that going this route has its pros and cons.

The upside of selling a home without a real estate agent

When you hire a real estate agent to sell your home, you lose money in the form of their commission. Redfin says the typical real estate agent commission is 5% to 6% of the sale price of your home. And to be clear, it's you, the seller, who pays that fee -- not your buyer.

So, let's say you're selling your home for $500,000. A 5% real estate commission would have you losing $25,000, while a 6% commission would have you losing $30,000. These aren't small amounts of money, and you may not want to give them up -- especially if you're selling your current home so you can upsize to one that's more expensive.

The downside of selling a home without a real estate agent

You might save yourself some money by forgoing a real estate agent when selling your home. But what you save by not having to pay a commission, you might lose in the form of a lower sale price.

One thing real estate agents tend to be really good at is setting optimal prices for homes and negotiating with buyers and their agents. So going back to our example, selling your home solo might give you $500,000 for it. With the help of a real estate agent who can also market and stage your home, you might be looking at $530,000 or $540,000.

Also, selling a home can be stressful. There are offers to review, negotiations to handle, and open houses and viewings to coordinate. These are all things that a real estate agent can handle on your behalf. Do them yourself, and you may find that the process of selling your home is overwhelmingly stressful.

Should you sell your home without a real estate agent?

In today's market, you really could go either way. It's easy to make the case that since inventory is so low, it doesn't pay to lose money to a real estate agent commission. But just know that hiring a professional to sell your home could still benefit you financially, even if you end up having to pay them a fee.

Also, think about how much time you have to dedicate to the home sale process. If you work a demanding job, you may want to get a real estate agent's help so you're not forced to juggle too much at once.