Facts on FSBO.com





FSBO, or For Sale by Owner property, is one that is being marketed by the owner without the involvement of a real estate agent or broker.

Why do Homeowners sell FSBO?

Why did you choose to sell FSBO?
 2004 2005 2006
Commission Savings 61% 53% 51%
Sell to friend, relative, neighbor 17% 22% 22%
Buyers contacted Sellers 9% 9% 12%
Avoid dealing with Real Estate Agent 6% 8% 8%
Seller has Real Estate License 2% 2% 3%
Agent Unable to Sell Home 2% 3% 3%
Couldn't Find an Agent 1% N/A 1%
Other 2% 3% 2%
Data from the National Association of Realtors, Profile of Home Buyers and Sellers 2004, 2005, 2006
  • Pricing - apparently most For Sale By Owners just aren't objective when it comes to pricing their homes. There are so many emotions wrapped up in home ownership that's it's difficult to accurately determine the market value of a home without professional assistance.
  • Exposure - with just 1 property to sell, For Sale By Owners simply can't afford to generate enough interest in a home for sale. By contrast, real estate agents have hundreds of properties to sell. They can afford to advertise because they know if the potential purchaser doesn't buy the home they advertise, there's a good chance they can sell them another from their huge selection in the Mutliple Listing Service (MLS).
  • Patience - the average For Sale By Owner gives up after just 2 -3 weeks. The mantra seems to be something like this, "we'll try it for a few weeks, but if it doesn't sell right away, we're going to give it to a real estate broker. " While it's certainly understandable that a home seller wouldn't want their home to languish on the market, (especially with the neighbors watching) more than half take more than 30 days even when listed with Realtors®.
  • Experience - without real estate selling education or experience, most home sellers are simply unprepared for the real estate marketing and transaction process. Situations that appear routine to the experienced real estate professional can seem daunting and perplexing to someone not accustomed to the home selling process.
  • Buyer Reticence - most buyers don't want to deal directly with an owner. Studies show that over 75% of home buyers use a real estate agent for their home purchase. The reason is that buyer's don't perceive that it costs them anything to use a Realtor because the seller generally pays the commission. Add to that the fact that FSBO properties are just generally more difficult to find because they're not listed in any well-known repository for homes for sale information like the MLS and you can see why for sale by owners are missing out on 3/4 of the market.

    • For-Sale-By-Owner websites

    All the FSBO sites combined comprise about 3% of all real estate listings, compared with 90% on MLS.ca alone.

    For-Sale-By-Owner websites make money by charging sellers to place ads on their websites. Their fees can range from a few hundred dollars to thousands. A common problem is a lack of follow up by website management, resulting in many houses still being advertised that are off the market. The websites look more appealing and viable to sellers the more listings there are, which can be one reason why many FSBO websites keep listings posted long after the houses are off the market. Buyers get discouraged quickly when they leave messages for a sellers and don't hear back from anyone.

    Many FSBO companies question why a home seller has to pay 6% realtor commission when they can simply pay $25 per month to place their home listing on a FSBO website. Now I’m not saying FSBO website exposure is a bad thing. I feel any exposure when selling your home is obviously a good thing. But, exposure alone is only part of the process necessary when selling a home. What the FSBO sites don’t tell you upfront can be quite scary.

    If you weren’t selling your home, would you allow a bunch of strangers in your home to look around at each room, opening all closets and essentially taking note of all your worldly possessions? Most of us would get nauseous at the thought. Well, by utilizing a FSBO service to market your home, that is exactly what you are doing. They offer no screening process to ensure the strangers coming to your door are qualified buyers. Most don’t offer any assistance with writing contracts or negotiating them which leaves the homeowner fending for themselves. Unless you are a skilled negotiator, you are in for a rough ride.

    When you list with a Licensed Realtor. you are getting much more than just marketing. A licensed Realtor is bound by certain ethics and rules that are in place to provide the home seller a plan of action to help reach their goals. Marketing is only one part of what a Realtor provides. A state licensed Realtor is also responsible for negotiating not only the price of an offer on the home, but also the terms of the offer. Terms can include:

    ***Amount of escrow deposit

    ***Amount of additional escrow deposits

    ***Financing terms

    ***Closing date

    ***Who pays title search and insurance? What if a title issue comes up? What if there are liens on the property?

    ***Home Inspection periods and what the seller will or will not include if repairs are needed. What if inspections turn up termites or other damage caused by wood destroying organisms?

    ***What if a buyer defaults on a contract? How are you protected against lost time and how do you get the escrow money they deposited.

    These are only a few parts of a contract that a professional and licensed Realtor negotiates on a seller’s behalf. Again, I’m amazed how anyone that is not highly skilled and knowledgeable in real estate sales and transactions would not highly consider interviewing several Realtors and reviewing their qualifications. I guess the closest thing to representing yourself in a real estate transaction would be representing your self in a court of law without using an attorney. Not a good idea. So, why would you pay a Realtor 6% commission? Quite simply to keep you out of trouble and protect your best interests. After all, we pay accountants, lawyers, doctors and consultants to advise us and keep us out of trouble. Why not a licensed Realtor?

    If you are considering selling your home and are not sure if you will proceed as a FSBO or hire a professional and licensed Realtor, You can also call me personally to discuss the options and what is best for your particular situation.
    At 914.438.8840 or visit my website at : Westchester Properties

    I can also can connect you with a local realtor in your area.

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