6 Reasons FSBO's are Financial Flops

Posted by Steph Kaye on Wednesday, March 16th, 2016 at 9:13am.

 

The information age has afforded many homeowners the ability to research various graphs, articles, statistics, and opinions in how to go about selling a home independent of an experienced real estate professional.  In fact, such technology can make almost anyone an expert in the field of their choosing.  Regardless the amount of personal research and desire to save on that 6% commission fee, there can be inumerable obstacles in the home selling process often resulting in financial loss.  

1. - The goal for any American dreamer is to save money, therefore homeowners cannot be faulted for attempting to "FSBO" (For Sale By Owner).  However, one of the most common mistakes of a FSBO property pertains to pricing.  Many homeowners over-inflate the asking price of their homes.  Overpriced homes do not sell and seeking the advice of an expert real estate appraiser or local real estate agent is strongly recommended.  

2. - Many FSBO-ers miss out on opportunities to capitalize off a professional realtor's marketing expertise.  In addition, location plays a major role in the successful sale of a home.  A realtor brings buyers into neighborhoods where multiple properties are currently being offered for purchase.  

3. - Electing not to hire a professional real estate agent means losing out on the realtor's online marketing and marketing materials (pamphlets, brochures, fliers, etc.), and professional photography.

4. -  Homeowners wishing to fly solo often underestimate how difficult it can be to wrap up the final details of a sales transaction.  While getting a buyer under contract is only a portion of the sales process, the aftermath can be quite daunting.  In fact, the challenge can be so extensive that nearly 80% of trained real estate agents leave the business within the first twelve months and 90% choose to move on within five years.  Real estate is not easy under the best of circumstances and with the most professional, experienced agent at the helm.  However, 89% of real estate transactions involved a realtor and successful FSBO sales typically hover around 8%.  Not understanding recent legislative changes in the way lenders are supposed to operate, real estate contract law, fair housing, disclosure (i.e. water and mold, etc.), and a good handle on marketing can be quite costly to a homeowner.  Regardless of the fact that we are living in the "Information Age", more skill is required beyond simply reading the research.  The concept of proper interpretation must come into play.  

5. - Some FSBO-ers agree to pay a buyer's agent commission or a transaction fee, however most realtors have no desire to work with a FSBO property.  Many of them feel that FSBO-ers are not open to negotiation, appraisals, repairs, contract changes, etc., and the responsibility in resolving these issues is often negated, thus resulting in the loss of a successful sales transaction.  

6. - Time is money.  If you are considering selling on your own and you work outside of your home, are you willing to run home for every showing, inspection, and other numerous appointments?  Furthermore, many scheduled showings can be a waste of time and gas money as people are less likely to show up than you may think.  Even if they do show up, don't expect them to be as punctual as you are. 

While no one is suggesting that homeowners should never sell their own properties without an agent, and everyone wants to save money when and where possible, FSBO-ing is quite risky and potentially much more costly for the home seller than hiring a professional realtor who can eliminate much of the stress in the home selling process.  Retaining the services of an experienced realtor is always recommended.  

If you'd like to learn more about FSBO's, please don't hesitate to message Lang Premier Properties online or call us at 1-855-526-4466.

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