Should You Sell Your Home via "For Sale By Owner" (FSBO)?
As I drive through neighborhoods,
inadvertently I will see a FSBO sign out front in a yard. Over 90% of them (signs and info box) are from the National For Sale by Owner organization. Some are just hand drawn or homemade signs. These signs and info boxes can be purchased on line or perhaps at Lowes or Home Depot. Ads can also be placed in their local FSBO magazines.
When you ask the home owner why they have elected to try and sell their home without the assistance of a realtor or even consider an auction, in most cases it has to do with saving commissions. They believe they can walk away from a closing table with more money in their pocket.
In some instances, the homeowner owes about as much as the home is worth, thus cannot pay a commission, not realizing commissions could be paid directly by the homeowner and not from the equity in the home.
But let's go back address the question about FSBO's saving on commissions. Do they really save? Some sellers are tempted to try a For Sale by Owner (FSBO) transaction because their local community is in the midst of a sellers’ market and they think they can sell easily and quickly without help from any real estate professionals. Maybe. Maybe not.
The FSBO homeowner needs to think through several things. Is the FSBO homeowner knowledgeable enough in negotiation skills? Has the FSBO homeowner priced the home correctly? How does the FSBO homeowner pre-qualify the buyer? Do you think a potential buyer is willing to give personal financial information to a FSBO seller as he/she would to a professional realtor? Does the FSBO seller understand real estate law and contracts and the liability of misrepresenting the condition of the home and its defects?
Statistics show that selling your home with the assistance of a professional real estate agent will garner you a higher profit, enough to cover the commission as well as put more money in your pocket.
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, a difference of $60,000. That would certainly cover any commissions and put money in your pocket.
Most buyers today work with a buyers’ agent to represent their interests. If you choose to sell your home on your own, i.e., FSBO, you’ll be negotiating with a professional and relying on your own skill to finalize a contract. Not only could you end up selling your home for less money, you could leave yourself open to potential legal problems unless you have the contract vetted by an experienced real estate attorney.
FSBO transactions can be successful, of course, but 90 percent of homeowners prefer to work with a professional rather than risk an unsatisfactory home selling experience.
The same goes for an auction. An auctioneer, like a realtor, and I am both, has access to market data about recent sales and other homes on the market that can be used to price your home appropriately. While a realtor can help you negotiate a contract, there are no negotiations with an auction, viz., what you see is what you get.
I read on FaceBook almost daily that my fellow auctioneers are selling properties at higher prices than expected. Is this always the case? No. With regards to a traditional listing, do houses always sell for the original list price? No.
Which is it: FSBO, traditional listing or an auction? Regardless whether you use a realtor or auctioneer, you have the peace of mind knowing that you have professionals working for you to get the best price.
Give us a call at 252-257-4822 and let's discuss which option is best for you or visit our web-site at www.cansellnow.com .