Benefits and Helps For Sale by Owners (FSBO)

Most people would say that the top motivation to have a For Sale by Owner is the potential to save money.   If you decide that it is for you there are some resources available online.  Here is one:

http://www.owners.com/resources

 

Be prepared:

• To do your own research about the market and the sales process.

• Know the legal disclosures you must make in your jurisdiction.

• Prepare yourself to stay unemotional about the sale; it is critical to your success.

• Be prepared to give up private time on weekends and evenings to show your house.

• Most buyers today work with a buyers’ agent to represent their interests. If you choose to sell your home on your own, you’ll be negotiating with a professional and relying on your own skill to finalize a contract.  Keep in mind that you will typically be paying a 3% commission to the buyer’s agent.  The buyer’s agents will not be motivated to show your home without commission.

• If you are the type who relishes being in control of all the details, you will probably prefer selling your home yourself.

• If a fast sale is a high priority for you, once you've figured out what the asking price for your house should be, subtract the amount you would pay an agent if s/he were to sell it at that price and reduce your asking price by a like amount, passing on your savings to the buyer. Your house will be priced lower than other comparable ones in your area, and buyers are likely to respond quickly and enthusiastically.

• You will need to find and hire a good real estate attorney to tell you what things by law have to be disclosed to the buyer prior to a sale, look over any contracts, and ensure you do not inadvertently discriminate against potential buyers.  You will need to find an escrow company to administer the closing.

• Owners will probably hear a lot about their home's shortcomings from buyers trying to negotiate a lower sales price. Or worse, they may not receive any interest in their home, especially if the price is too high.

• It may seem pushy, but FSBO sellers must be willing to screen their own buyers.

• You don't want to take your house off the market to negotiate with someone who was never qualified for the home in the first place.

• Know the difference between pre-qualified and pre-approved.  Pre-approved is preferable to indicate serious buyers. 

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Benefits of working with an agent:

• Professional help pricing your property to sell.

• Most agents believe they can help you get more $.

• Your agent will:

  • Advertise and market your property.

  • Take calls from other agents and potential buyers.

  • Save your time and energy to focus on other things.

  • Show your home to potential buyers (even when you are not available).  Many buyers prefer to not have the owner there when they look at the home.

  • Get feedback from potential buyers to help you know what improvements to possibly make to help sell faster.

  • Screen potential buyers and make sure they qualify.

  • Have access to proper real estate forms.

  • Help negotiate the offer and sale (always getting your permission).

  • Help you stage your home for a faster sale.

  • Build trust with potential buyers.  Many buyers say they don’t trust the homeowner.

 

Here are five of our reasons:

1. There Are Too Many People to Negotiate With

This is a list of some of the people with whom you must be prepared to negotiate if you decide to FSBO:

• The buyer who wants the best deal possible

• The buyer’s agent who solely represents the best interest of the buyer

• The buyer’s attorney (in some parts of the country)

• The home inspection companies which work for the buyer and will almost always find some problems with the house

• The appraiser if there is a question of value

• Your bank in the case of a short sale

2. Exposure to Prospective Purchasers

Recent studies have shown that 92% of buyers search online for a home. That is in comparison to only 28% looking at print newspaper ads. Most real estate agents have an internet strategy to promote the sale of your home. Do you?

3.  Results Come from the Internet

Where do buyers find the home they actually purchased?

• 43% on the internet

• 9% from a yard sign

• 1% from newspapers

The days of selling your house by just putting up a sign and putting it in the paper are long gone. Having a strong internet strategy is crucial.

4. FSBO-ing has Become More and More Difficult

The paperwork involved in selling and buying a home has increased dramatically as industry disclosures and regulations have become mandatory. This is one of the reasons that the percentage of people FSBO-ing has dropped from 19% to 9% over the last 20+ years.

5. You Net More Money when Using an Agent

Many homeowners believe that they will save the real estate commission by selling on their own. Realize that the main reason buyers look at FSBOs is because they also believe they can save the real commission. The seller and buyer can’t both save the commission.

Studies have shown that the typical house sold by the homeowner sells for $184,000 while the typical house sold by an agent sells for $230,000.   This doesn’t mean that an agent can get $46,000 more for your home as studies have shown that people are more likely to FSBO in markets with lower price points. However, it does show that selling on your own might not make sense.