For Sale by Owner. FSBO. Fizz-bo. You versus the system! You’re not part of that game. You don’t want to pay a real estate agent to do something you can obviously accomplish on your own: Selling your own home. Believe me, I get it! Before becoming a licensed agent, this was me. It’s not that I was against Realtors, per se; I just didn’t want to pay a whopping 6% on top of other closing fees, when I could do the job myself. Am I right? And you know what? Sometimes we were successful; and other times we actually needed an agent to represent us for various reasons. Let’s dive right in to what’s up and down with FSBO.
The PROS of FSBO:
- Seller maintains control of who enters the home, and has the ability to select who will purchase the home. To some sellers, that option is everything.
- Eliminating the game of telephone tag from Buyer to Buyer’s Agent to Listing Agent to Seller. Theeeeeen back again. Whew! Just give me an answer already!
- Sellers are the expert on their own homes, and know every little detail about them. You can answer any question about the property right there, on the spot.
- The biggie here, and number one reason a seller chooses FSBO: savings of up to 6 percent in commissions (believe it or not, there is a flip side to this, and we’ll get to that). I mean c’mon! That’s a lot of money you’re paying out for something you could do yourself, am I right?
- Access to resources like For Sale By Owner sites, Zillow, Facebook Marketplace, Craigslist, etc. makes FSBO easier than ever to market your property.
The CONS of FSBO:
- Time constraints: It takes time and money to market and show your home to potential buyers. Afterall, it’s not your day job.
- Limited audience: Whether we like it or not, MLS and brokerages dominate the real estate market, and in repeated studies, buyers still prefer agency representation to negotiate on their behalf. This means an FSBO property will just not have as many showings as properties listed through representation.
- In other studies, FSBOs are typically listed higher, but sell for less than their market competitors. Let’s face it, when it comes to our own homes, styles, and decorative skills, we all wear rose-colored glasses. Third parties see past all of that and are trained in pricing your home competitively in the market no matter what color that bathroom wall is painted. *
- So why do FSBOs tend to sell for less? As stated above, fewer showings equal fewer offers, and fewer offers mean less competition to drive those offers up. Are you open to working with a buyer’s agent? If so, remember to mention that in your listing, and you’ll probably gain a little more interest in your home.
- Legal “stuff.” The MLS uses legally prepared documents for Purchase and Sale Agreements, Addendums, and other contracts. Good agents know how to navigate these documents and advise clients prior to signing.
- Buyers are less likely to back out of the deal when agents are involved, simply due to third party accountability.
All things considered, what is the top reason you would sell your property without representation? If it’s commissions, but you’re also concerned with the headache that may go along with FSBO, have you considered negotiating with a trusted agent, and landing on a listing price you’d be happy with? If you are worried about contracts, have you reached out to an agent that would be willing to help navigate them for a fee instead of a full commission?
If you need help in deciding how best to sell your home, ask an honest expert. Don’t feel bad about calling more than one agent and advocating for your needs.
*It is important to note that Idaho is a non-disclosure state, meaning sold prices are not public information. Guess what though? Real estate agents have access to sales prices through their local MLS. Many times, potential FSBO sellers price their homes according to Zillow (which does not have access to accurate sales prices) or what they see other homes listed for, as opposed to what comparative homes have actually sold for.