The Reality Of “For Sale By Owner”
We’ve all heard stories about lucky homeowners placing a “for sale” sign in the yard, opening their front door on a Sunday afternoon and receiving a full-price offer at the end of the day.If you’re thinking of selling your home, you might be lured by these successful “for sale by owner” stories. After all, you reason, why pay commission to a REALTOR®, when you could keep the profits all to yourself? But the reality of FSBO listings is far less rosy than you might think:
• Advertising works best when it’s run frequently over a period of time. Most FSBO sellers, however, try to cut costs by running a single ad here and there, usually not often enough to attract the attention of many buyers. The REALTOR®, on the other hand, advertises their listings often in print media, in electronic media, and in the Multiple Listing Service, which is only available to a licensed REALTOR® and broker.
• Most homeowners believe their house is worth more than it really is. Even if you study comparable homes and try to discern the value of yours, it’s still a time-consuming process and an amateur’s guess. If it’s not competitively priced, many prospects will simply bypass your home. If you later lower the price, you’ll have to advertise again, at more cost to you.
• Most of us grow accustomed to our home’s imperfections over time. A REALTOR® can see a house the way a prospect would. He or she may suggest some minor improvements, like fresh paint, new vinyl flooring or furniture arrangements that could help your home sell faster and for more money.
• A REALTOR® will qualify prospects before showing them a home. A FSBO seller is at the mercy of everyone who calls or knocks on the door. You may spend valuable time giving tours to curiosity seekers or prospects that can’t afford your house.
• Prospects often shy away from FSBO homes. Some fear legal problems because of the intricate paperwork involved. Some may worry the seller is not disclosing everything about the home’s condition. Others may simply feel uncomfortable negotiating directly with the owner.
Many FSBO stories, unfortunately, don’t have a happy ending. After a considerable outlay of time and money, sellers often list with an agent in order to get their house sold. Unless you have a sure buyer – a cousin or coworker, for instance – consider listing your house with an agent right away before it grows market-weary.