For sale by owner, known by the acronym FSBO, is a route that some homeowners choose to go when they sell their house. Understanding the pros and cons of an FSBO sale can help a homeowner decide whether or not an FSBO real estate transaction is right for them.
Pros of FSBO Sales
The majority of homeowners who choose to sell their home on their own without help from a real estate professional usually choose to do so to save some money. Real estate professionals charge a percentage of the home sale as a part of their commission when the house sells. This earned commission is used by the agent to pay for marketing materials, advertising, MLS and brokerage fees, as well as the time and expertise of the agent. Homeowners who want to avoid paying a commission can do so by selling the home without using the services of a real estate agent.
Often, homeowners who choose to sell their own home do so because they may have a do-it-yourself mentality that allows them to enjoy doing things on their own - while other people may turn to outside professional assistance. These DIY homeowners may receive a sense of satisfaction from successfully starting and ending another project - no matter the time, cost and potential frustration of their decision.
Cons of FSBO Sales
Unfortunately, there are many ways that FSBO transactions can go wrong for the homeowner. Homeowners who decide to sell their property without help from a real estate agent should be aware of these problems before deciding for sure if they will go through with the sale alone.
Inability to List on MLS
The Multiple Listing Service or MLS is the main home-for-sale online listing website. Other real-estate focused websites draw their listing from the MLS listings. If a home is not listed on MLS, then it is not listed on any of these other websites either. Only real estate professionals can list on an MLS website. So if a home is being sold by a homeowner, then they may have a hard time reaching their target audience as their home will not appear on the MLS.
Difficulty With Forms
There are a variety of different forms that home owners must fill out when selling a property. If they do not fill out the forms properly, they could open themselves up to liability after the sale of the house. Homeowners who want to ensure that they fill out the forms properly should seek out the services of a real estate agent or real estate lawyer.
Trouble With Pricing
It's hard to price an Eagle River home properly without expertise in real estate and knowledge of the real estate market in the area. If the home is priced too high, the inflated price could drive away buyers before they even preview the home. And if the home is priced to high, continually dropping the price down to a true market value could give buyers the impression that there is something wrong with the home. Buyers tend to shy away from houses that sit on the market for months or years.
The best way to avoid this problem is to work with a real estate agent to ensure that the house is properly priced. Buyers who don't want to work with a real estate agent will need to do a lot more research to find out the right selling price for the home.
Trouble With Marketing
In addition to the home not being on the MLS and other real estate websites, most FSBO home sellers do not have the experience to market a home. Proper signage, staging a home and marketing materials are all a part of the real estate professionals arsenal to sell the home. A homeowner that has no experience with selling, marketing or properly staging a home, may have much more difficulty in the selling the home in a reasonable time frame or for the price they may desire.
Contact a Real Estate Agent Near You
If you're a homeowner who wants to sell your home, consult with a real estate professional before deciding whether or not an FSBO is right for you. You may be surprised by what you don't know about selling a house. For more information, contact your real estate professional today.