Consider this if considering FSBO
Listing your house For Sale By Owner (known in the industry as a FSBO, pronounced FIZ-BO) brings its own set of considerations as compared to listing a house with a licensed real estate agent. You can eliminate the middle man, and "save yourself the commission", right? While you might be able to eliminate the "middle man", you can't eliminate the middle man's job. 80% of FSBO homeowners ultimately end up listing with a real estate agent after striking out on their own, and if this is the case, what made them do so?
First, there are many people involved in the transaction that you would have to negotiate with. The buyer who wants the best deal possible. The buyer's agent, who represents the best interest of the buyer. The buyer's attorney. The home inspector who is hired by the buyer and will almost always find something wrong with the house that needs to be fixed. The appraiser when it comes to determining value of the house for the buyer's mortgage. The bank, if you are in a short sale situation.
Recent studies show that 92% of buyers use the internet to search for their prospective home. Approximately 28% look to print advertising. Most real estate brokerages have an online marketing strategy to promote their listings, do you? After all, those listings are the ones that your house will be competing with.
Where do buyers come from that actually purchase a home? Recent studies say that 3% of buyers actually come from print advertising, 18% come from the sign in the yard, and 40% come from name/firm recognition or sales person contact. Gone are the days of throwing an ad in the paper and sticking a sign in the yard. Having a strong community presence and internet strategy are crucial.
The paperwork in buying and selling a house has dramatically increased in the last 20 years or so as industry disclosures and regulations have become mandatory. And once you have found a buyer? Making sure that they're qualified and can close is key. That wasn't your job, was it?
Many homeowners believe that they will save the commission by listing FSBO. Sellers should realize that buyers looking at FSBO listings are probably doing so thinking that they can get a deal. By listing FSBO the seller may be subconsciously telling the market place that they are willing to sell at a reduced price. With that mentality, many buyers will make an offer much lower than the "already-reduced-I'm-cutting-the-commission-price. This means that the seller ultimately ends up netting far less than their reduced list price, and in most cases less than they would have received by listing with an agent in the first place.
Could listing your house FSBO be the right move for you? Maybe. Before listing take the time to sit with an agent in your market place and see what they have to offer.
Melissa Rolland is a licensed Connecticut realtor. She lives in Tolland, along with her husband Todd, a licensed broker. Together they manage the Rolland Realty Group at Keller Williams Realty. You can connect with them at www.RollandRealtyGroup.com.