A short time ago, my friend Joshua purchased his first…
For Sale By Owner, or FSBO, is widely misconceived as an “easy” way to sell your house without representation of a real estate agent. There are many reasons why homeowners choose to sell their house by themselves, but the main motivation is to avoid paying a commission on the sale. Before you even consider selling your house without a real estate agent, here are a few reasons you should hire a Realtor:
Real Estate Agents Are Your First Defense. If you are selling your house by owner, you don’t necessarily know if a buyer is even qualified to purchase your house. A majority of buyers who are working with a Realtor are already pre-approved by a lender to view houses in their price range. Real estate agents are trained to ask qualifying questions to figure out if a buyer is even able to afford a property or not. If a buyer comes in to see your house and they are not working with an agent, you have no way of knowing if they are pre-approved to purchase your house, and you can end up wasting time.
Selling Houses Isn’t a FSBO’s Full Time Job. When you are selling your house, your home should be ready to be shown within a couple hours notice and it’s very common for buyers to want to see a property in the middle of the day. Most working professionals can’t leave their job at a moments notice to let a buyer inside to see their house. They also don’t have the ability to answer every call that comes through during the work week from a potential buyer or Realtor inquiring about their property. Your real estate agent is there to be the one to answer calls from other agents, arrange and schedule showings for your home, and make sure you have all the proper paperwork that is necessary to sell your house. Realtors also use a co-operating scheduling system that allows them to give instant feedback on the property so you know if a buyer is interested in making an offer.
Marketing. On top of the normal day-to-day work and family obligations, FSBO’s just simply do not have the time to spend marketing their home and scheduling showings for potential buyers. According to the 2015 National Association of Realtors Profile of Home Buyers and Sellers, 25% of FSBOs did no marketing at all for their home. A lot of disruption happens during the home selling process- especially if you are organizing, packing your belongings and searching for your own new property to move to. Let a professional real estate agent handle scheduling showings, market your house, and negotiate the best price for you.
FSBOs Typically Overprice Their Home. Whether you are FSBO or you are listing with an agent, pricing your house too high will result in fewer showings, and subsequently fewer offers. When a real estate agent is working with a homeowner to list their house, they use data from multiple sources to come up with an accurate price range. Realtors have access to these tools to create Cost Market Analysis (CMA) which help give you a good idea of what your home is worth. This helps set the expectation so when you get an offer from a buyer you know if it’s fair or not.
Selling Your Own Home is Risky. Real estate agents know the rules and regulations involved in selling a home. They have what is called “Errors and Omission” Insurance which protect them if any mistakes are made during the transaction. They also know the guidelines in different counties like who pays for transfer tax, title search or what disclosures are needed in order to sell a property. Plus, when you hire a Realtor to sell your house, generally there is no cost out of pocket from the homeowner to list the property. Your Realtor pays for all of the marketing cost associated with selling your house, and they don’t get paid until the house sells. You really want to make sure you hire a professional who knows your area so that they can handle all the bumps in the way for you so you can focus on other priorities of moving.
All in all, selling a house by owner can really end up costing more if you aren’t aware of what is involved. Like all other projects in life, make sure you hire a professional. If you are considering selling your house, I’d love to help. Want to know how much your house is worth? My consultation service is completely free. Visit MaggieFromm.com for my contact information. Oh and by the way, I’m never too busy for any of your referrals!