Despite the many drawbacks, there are still a good number of homeowners trying to sell their homes without utilizing the services of a real estate agent. Referred to as FSBO or For Sale By Owner, it is generally an effort by the owners to save the money that is paid to real estate agents as commission.
Today, there is a lot of information on the internet about selling your home, which is perhaps the reason for the increase in homeowners attempting to go it alone. Owners believe they’re saving money selling their properties using this information themselves, only utilizing professional services for certain aspects of the process such as assistance with the legalities in the contracts.
However, the homeowner is more often than not doing themselves a disservice in an attempt to save money- either by failing to sell their home promptly or by negotiating a lower price for their home than a professional could have fetched.
FSBO Results in Lower than Average Selling Prices
Despite the growing numbers of For Sale By Owners situations, it has been found that a clear majority of these owners are not able to get the best price for their properties. The average price accepted by FSBO negotiations is significantly lower than what owners selling their homes through real estate agents have realized. According to the National Association of Realtor’s 2016 Profile of Home Buyers and Sellers, the average FSBO sales price was $185,000, while the average price for a home represented by an agent was $245,000. That’s a whopping 60,000 difference! As mentioned above, many property owners don’t consider this opportunity cost and instead narrowly focus on avoiding a paying any commission
FSBO can be a Long, Stressful Journey
The key to selling a home quickly lies in gaining exposure for your property from people likely to be interested in the home. If you’re not as familiar with real-estate marketing, you can easily fail to catch the attention of your ideal buyers, and instead waste precious time and resources communicating to folks who are either not in a position to buy, or are not looking for what you have to offer in a property.
An experienced realtor not only lists your home on the market but also uses their network to spread the word around about your house. Realtors also often help with staging, photographing, and showing your house in an ideal manner that will be effective in drawing offers from interested buyers.
Also, should a FSBO get an offer, the owner will likely then be confronted with legalese and contract terms they then need to go back and research before accepting- likely delaying the acceptance of the offer and risking the sale. Worse yet, the offer could be accepted too quickly and the owner may have entered themselves into a contract with contingencies they can’t afford or that won’t work for them- bringing along a new set of woes.
An experienced realtor will take the time to efficiently explain all of the presented terms, examine whether or not they fall within the acceptable range of the seller, and negotiate on the owner’s behalf to realize the best possible outcome for their client.
Real Estate Agents are Skilled Negotiators
Owners attempting to sell their homes on their own will likely find it difficult to negotiate with buyers and their agents. With all of the different moving pieces that can present in a contract such as contingencies, terms, and protection clauses- it can be a tricky world to navigate. Having an experienced realtor at your side will save you significant time and worry during this already-stressful process.
Fear of Large Upfront Fees
Often, owners opt to go FSBO because they fear to have to pay a hefty initial fee to an agent, and would instead use that money elsewhere like for home improvements or repairs. However, real estate agents do not charge any payment upfront. Instead, owners sign a contract with agents with the understanding that the commission of the agent is payable only when they can sell the house at a mutually agreed price, by an agreed upon time.
Finding the right agent can make a world of difference in the process of selling your home. Consider this information carefully before coming to a decision, and be sure to team up with a professional real estate agent who will work in your best interest and take the time to explain the process with you and understand your needs and goals, so you can arrive at the best possible outcome and a successful sale of your property.