For Sale By The Owner (FSBO)
IMPORTANT FACTS TO CONSIDER BEFORE YOU TRY TO SELL YOUR OWN HOME
Occasionally, one can see "For Sale By Owner" signs, and some owners think that selling their own home will not only save them money, but believe they have an advantage over the sellers that have their home listed by a reputable RELATOR©. Studies have shown that for sale by owner properties generate less money for the sellers than when the property was sold by a real estate professional and after taking out the commission. Before you decide to take on this very important and legally complicated process… remember, most Real Estate Lawyer's will not recommend selling your property by yourself in today's market. Here are a few of the reasons why:
- The majority of qualified buyers are working with experienced real estate professionals. Mainly, there are three types of buyers: The ones that need to buy a home immediately, the ones that are looking for now and will buy sometime in the future and the ones that are just looking and they don’t know when they are buying! Almost all the buying activities happen in the first group. Guess who will they go to first to buy their home and when they need to buy as soon as possible. They will all trust and hire a RELATOR© to find them a house. If you had a short time frame to buy a house, would you hire a real estate professional, or would you drive around the city to find for sale by owner signs?
- You are limiting your exposure to potential buyers (less than 5% of what a good real estate broker will generate); which, theoretically means your home will take a lot longer to sell on the market.
- Because of the limited exposure, you will very likely end up with a lower selling price. Remember, right exposure means selling and you need the maximum exposure possible, to generate the highest price possible.
- The longer a property is on the market the lower the selling price will be. Why? Because most buyers think that if the home has not sold after so long... there must be something wrong with the property or that the seller should be desperate to sell.
- If you are planning to use a Lawyer to help you negotiate the offer, then your lawyer's fees will be considerably higher, and between the ranges of 300 to 600 per hour. To make the matter worse, you would have to pay your lawyer even if the deal doesn't go through. On the other hand, you only pay the commission to the real estate broker, if they successfully sell your home at the price you are happy with and all offer conditions are satisfactory to you.
- The selling/buying process begins AFTER the buyer leaves your home. Most sellers think that all it takes is for someone to see their home, fall in love with the great decor... and the offer automatically will follow. Remember that the buying process begins after they leave your home. If a real estate sales representative does not represent the buyer, and they are looking on their own…they usually leave the home and start to talk themselves out of the buying process, or wondering off and finding another house. Your REALTOR REALTOR© is trained on how to overcome buyer’s remorse, a very common occurrence, and help all the serious buyers to bring you an offer.
- Most buyers find it extremely awkward to negotiate or even to talk directly with sellers and therefore avoid for sale by the owner (FSBO) properties. And when they do approach a FSBO, most of the time the emotions will take over and the negotiations will suffer and therefor the offer will be unsuccessful.
- Lack of negotiating experience and lack of pertinent information often will result in a lower selling price, or worse yet, a bungled contract and possible lawsuits.
- As most local buyers now retain an experienced real estate sales person to represent them as their buyer-agency, you will probably be negotiating against an experienced professional. If you where to go to court, would you want to be stand against an experience lawyer defending your opponent or to be represented by your own experienced lawyer? Same scenario applies when selling a real estate.
- Only real estate sales representatives have access to the up-to-date market information. News reports cannot approach the timeliness or specificity available to real estate sales people. Further, real estate sales representatives are involved in home sales much, much more frequently than the average homeowner is. This familiarity leads to a degree of expertise that provides an edge on negotiating and successful selling.
- Accepting an offer is one thing, ensuring a safe and successful closing is quite another. Real estate transactions can have problems on closing. At times, expecting the Buyers and Sellers Lawyer's to fight it out or resolve the problems, can sometimes mean the deal is lost. A good and reliable real estate professional always makes sure to over sell and prevent any problems that may occur. Furthermore, in case of an unforeseen problem, lawyers will charge you by the hour and your REALTOR can greatly minimize the time that lawyers spend on solving the issues that a your REALTOR will do for you for free.
The bottom line is that with a REALTOR, you will end up selling faster and with higher price, even after the commissions are paid.