Do you know the pros and cons of selling your own home – FSBO (“for sale by owner”)? Whether buying or selling, deciding to go the for-sale-by-owner route can be a tempting one to consider. Working with a real estate agent can result in higher costs for both the buyer and the seller. You may also feel as though you are being rushed through the buying or selling process so that the agent can collect and move forward. While it is easy to take note of positives to working on a FSBO, it is also important to make yourself aware of the potential drawbacks. Below are some potential drawbacks of selling a house yourself.
A major benefit of FSBO is the direct communication that occurs between both parties. By communicating directly with the buyer, you can ensure that nothing is lost in translation, as the conversation does not have to go through any middle-men. This aspect of the process can often result in things moving smoother and quicker, compared to speaking through a buyer’s agent and a seller’s agent.
The downside to this is that most buyers will hire an agent to work for them on their behalf, meaning that you will be relying on your own expertise to work with a professional. Not only might you end up selling your house for less money, but you also have the potential to open yourself up to legal issues or other problems by not having the contract vetted by an experienced attorney.
Homes that are sold directly by their owner usually sell for lower prices than those sold by a real estate agency. While this is beneficial for the buyer, it is a negative aspect for the seller. Although the seller does not have to pay agent fees when acting independently, they still make less off of the sale than they would have, had they listed through an agency. According to the National Association of Realtor’s 2013 Profile of Home Buyers and Sellers, the average FSBO sales price was $174,900, while the average price for a home represented by an agent was $215,000.
One main reason this occurs is because some buying agents stray from working with homes being sold by the owner, which results in fewer bids on the property. Additionally, professional real estate agents are experienced negotiators AND marketers. They are trained to communicate and mediate. They also have access to more online and offline marketing tools, giving them access to more information about property values and comparables, as well as a wider audience of potential buyers.
A drawback to FSBO is the amount of time that it takes to manage the process yourself. As the buyer, you have to search for properties in which you are interested, contact the seller, and set up viewing times. All of this can take up a large portion of your time, since they are tasks usually performed by an agent. As the seller, you have to market and advertise your home, find outlets to list it, and make sure that it is getting seen by potential buyers.
When selling or buying a home without an agent, you may lack the resources for making a deal that is beneficial for all. However, there are tools and online resources that you can take advantage of, making this process less daunting. Each of these services provides you with access to people knowledgeable in the real estate industry to offer you advice and tips to make sure that your experience is positive financially.
Choosing to enter the world of home-buying or home-selling as a free agent can be a positive experience if you make ample use of the resources available to you. It is crucial to make yourself aware of both the benefits and flaws related to FSBO sales. Arm yourself with knowledge and remain aware of the valuable resources that are available to you. When doing so, you’ll be ready to successfully sell or buy a home with the assistance of an agent, saving you money in the long run.
We realize that not everyone wants to sell their house through common methods and listing through an agent. At Advantage Homebuyers of VA, we pride ourselves in offering a service for people who want to avoid the hassle and fees of a traditional sale!
If you considered selling a house yourself and didn’t move forward, or you tried and didn’t have any luck, then we would love to help. Call us now for a no-obligation quote in 24 hours, or just to ask questions about our process.