So you want to sell your house as a FSBO (For Sale By Owner)? Here are some facts that may be helpful...
We have been living in very turbulent times over the past year or two in the real estate market. I agree that it may have been okay to sell your own home in times gone by, but... those times have definitely GONE BY. It no longer makes sense, nor is it in any seller's best interest, to sell their own home! Even we REALTORS® do not list our own properties; we list with another REALTOR®, believe it or not. We know that we cannot represent ourselves as well or as efficiently as someone else can who has no personal interest in the transaction (doctors & lawyers do not represent themselves, either; they know better!)
Selling your home as a "FSBO" sounds good on the surface; many feel they are "saving on the commission" and that sounds understandable, but when put into the context of actual results, here is what actually happens:
•1) FSBOs generally sit on the market much longer than properties listed by agents. This costs the seller more money in carrying costs (utilities, mortgage, etc).
•2) FSBOs statistically sell for anywhere from 5% - 8% (OR MORE) less than properties sold by agents, whereas our commission may be around 6% - 7% or so of your sale price (this varies from agent to agent - some more; some less), which shows that you actually don't save any money by selling your house yourself. It is better to list with an agent and have them do the work and the marketing for you!! You might even come out ahead that way! By the way, for the smaller commission, you will usually receive less services.
•3) FSBO Sellers have to always be on call to show the house and have to always have it in showing condition. While this is generally true even when listing with an agent, at least then you usually get a call and have some time to spruce the place up for the showing. Sellers should not show their own houses (see #5). Plus, people may knock on your door any time of the day or night - you could miss the sale if you are not home! In addition to all that, there are safety/security issues of letting just anyone into your home. We verify and qualify our buyers before we go out looking at houses with them.
•4) FSBO Sellers have to do their own Open Houses. This should not happen! (see #3 & #5) By the way: Only 1% - 2% of sales result from an Open House! Most sales come from an agent and/or buyer seeing the listing in the MLS or on a website and having a private showing. This is why listing in the MLS and on websites is so very crucial to the sale! (Most agents use Open Houses to find more buyers and sellers, even though their primary focus is to sell that particular house.) Many agents don't even do Open Houses; in this day of the Internet, they really aren't necessary. A VisualTour, which also costs money, can do the same job and elicit a private showing.
•5) Any time a Seller & a Buyer come face to face, negotiating begins, even on the subliminal level (body language and facial expressions, etc.), not to mention saying things you should never say to the other party!!! This is a definite DISADVANTAGE for both parties! It is best to have an experienced agent show the house and do any negotiating for you. (We are trained in the process and the psychology of it.) There is too much danger of you being tempted to "give in" and fall for the other party's "sob story", reducing your price and losing money in the process. (see item #2 above). Buyers & Sellers really shouldn't ever come together without agent supervision, and then only at the settlement table for this reason, as well as others.
•6) It costs money to market a home, and you don't have the resources we have. It will cost you $ just to list it in the MLS (we pay dues and can just "pop" it in there, and we know how), and we are trained in the lingo and the regulations. Advertising costs money. We have ways of marketing to each other, too, and we pay extra $ to "feature" your home on the websites we use. (We list on MANY websites!) They cost $ too. While you will be marketing in a limited local fashion, we can market nationally & internationally. Who knows from where someone will be relocating? Our resources are vast and yours are limited. WE EARN THE COMMISSION!!! Do not be misled!
•7) LAWS, RULES, & REGULATIONS have been changing in the past year or two on a monthly, weekly, and yes, sometimes daily basis! You have NO IDEA! We find it hard to keep up; how could you possibly do that? Lender requirements and programs change even more rapidly. FannieMae just changed some rules on the 12th. Do you know which ones, and what they may or may not mean to you? What a jungle it is out there!
•8) Most REALTORS® require our buyer clients to be Pre-Approved by a Lender so we won't be wasting our & their time and resources (see above) on showing homes to people who cannot buy them. DO YOU KNOW WHAT MAKES A GOOD OFFER AND WHAT DOESN'T??? We do! It's not always about the money; it can be other things. We will advise you on the legalities of the whole process and the offer (we pay for continuing education and are required to be educated on the legalities of it all!)
•9) When it comes to the settlement table, are you cognizant of the way things should go? Who is watching out for your best interests at the table? Do you even know what to watch and listen for? (You could be up against a very savvy agent or even a lawyer who is looking out for the buyer, not you!) A good agent does know, and will protect you there! Without us, you will need to pay an attorney.
I could go on, but you get the idea by now. I do not believe it is ever to your advantage to sell your home by yourself, not in our new reality of the Real Estate/Lender/Appraisal world! If you do decide to go the FSBO route, find an agent who can and is willing to advise you throughout the process. We will usually do this free of charge, knowing that:
#10) 80% of all FSBOs eventually use a Listing Agent when they tire of #s 1-8, and if we are the one being relied upon for the advice, we will get the listing in the end, having built that relationship with you.
So... Do yourself a favor, save yourself some time and money, and find a good, reliable, reputable agent who will keep your best interests as their focus and get the job done for you. Interview at least 3, and go with the one who has the best track record and with whom you feel a good rapport. Listen to their advice and price the house accordingly; cooperate with them and you should get your house sold in a reasonable amount of time for the best price the market will bear at that time. We are trained to make the process as easy for you as possible.
If you should have a problem with the REALTOR® you hire and their broker won't fix the problem, fire them and hire another one. You are still in control, but having the expertise and experience of a well-trained agent should serve you well in the long run.
Keep in mind: it won't cost you anything until you are at the closing table (although it would be wise to have a whole house/pest inspection, plus any other relevant inspections - i.e.: well, sewer, etc. - done before listing so you don't get any surprises after an offer is made, plus having an appraisal done/paid for up front as well, which will help you choose the right listing price). Offering a Home Warranty also helps sell the home and provides confidence in the buyer prospects; it also protects you after the sale, liability-wise.
At the settlement table, you will KNOW that we have earned that commission!!
Good Luck in selling (or buying) your home!
Feel free to call or email me with any questions or concerns you may have; I will be glad to assist or advise.
Paula Burt, REALTOR®
Keller Williams Keystone Realty
York, PA 17402
717-755-5599, Ext. 3055
RealEstateLadyPJB@gmail.com
