Fsbo vs. for sale by owner

It's a natural question to ask. Everyone has seen the sign "For Sale By Owner" so it's clear that some homeowners try to sell their own property. It's also clear they don't have to pay the real estate agent's commission on such sales.

What isn't so clear is how much work and risk is involved in these sales by homeowners, and whether the price they receive is high enough to make the savings on commission worthwhile.

It's exactly because real estate marketing and the negotiation of real estate sales is so complex that real estate agents exist in large numbers and must undertake rigorous training and qualification before they can be awarded licenses.

So, if you're a homeowner who is wondering whether it's worthwhile for you to put up your own "For Sale By Owner" sign, we believe it would be helpful to consider the following questions before coming to a final decision.

What's the right price?

The right price should be "in line" with equivalent properties in the same and comparable neighborhoods. If you don't have plenty of up-to-date statistics on current actual sales, it will be virtually impossible to set the right price. You will either price your home for less than the market value, or, what is sometimes worse in the end, you might overprice your home, resulting in no buyer interest for many months.

A competent real estate agent will have accurate and up-to-date price comparisons. They can help the owner establish a realistic asking price that enhances the chance of sale at the true market value of the property.

How do you attract and screen buyers?

Most homeowners can afford only a fraction of the advertising that real estate agencies can place. Nor will a small advertisement attract the attention that professionally placed larger display advertisements can. Fewer prospects mean that the average wait for a sale is much longer for the owner who handles the sale himself. Fewer prospects can also mean a lower price.

By far the biggest disadvantage the homeowner faces is that multiple listing and referral services frequently used by professional agents are not accessible to the "do-it-yourself" seller. The vast majority of homes sold are sold through these databases, which are visited constantly by potential buyers and real estate agents representing potential buyers.

The "For Sale by Owner" signs and advertisements are also open invitations to the world at large to come through your home. You will probably find it difficult to screen prospective buyers, to limit visitors to qualified buyers, or to regulate the hours when strangers will call or drop in from the street.

For every home there is a buyer, if it's priced right. But for every "For Sale by Owner" sign, there is a multitude of people who have made selling a home a nightmare for owners.

How are you going to negotiate the sale?

There is a certain moment in the sale process that demands a special kind of sensitivity. That's the moment when the buyer is pretty sure that he or she wants to buy your home, and needs just the right encouragement to make a positive decision.

There are many signs that you should be able to recognize. Strange as it may seem, this is the time when the buyer starts voicing objections that would lead you to think he or she is not interested at all. The inexperienced seller often makes the mistake of taking this at face value and ending the discussion. The experienced real estate professional realizes that the time is right to come to an agreement and has the skills necessary to close the sale on an amicable basis.

After you've made the sale, what's next?

Your job isn't over yet. Appropriate deposits must be made. Financing must be arranged. Disclosures required by state/federal laws must be made. Certain third parties must be brought in to handle inspections, surveys, etc. A vast amount of paperwork must be created and completed. The potential for either costly errors or errors that could void your sale at this stage of the transaction is considerable.

Still think you want to sell it yourself?

To assist you in your decision, we've provided a homeowner's checklist. If you can answer "yes" to most of these questions, it means you may be capable of acting as your own professional real estate broker/agent. If not, we urge you to call your local real estate professional.

Are you prepared to....

• Set the right selling price?
• Create and place effective advertising?
• Groom and improve the property so it will sell for top dollar?
• Screen potential buyers?
• Protect against undesirable callers?
• Extract an offer to purchase?
• Negotiate objectively?
• Make a "hard close"?
• Negotiate financing alternatives?
• Protect yourself in escrow?
• Arrange sale terms for the best tax effects?
• Avoid guarantees to buyer that will obligate you later?
• Remain in the house if it should not sell for a long time?

Make it easy on yourself!

For every good reason it makes sense to list with a real estate professional. We should know. Liberty Title has been working closely with real estate brokers and agents for over 25 years. We know how invaluable they are in any real estate transaction. They can save you money, time and disappointment.

Whether your home is for sale "By Owner" or listed with a real estate agent, choose Liberty Title Agency for all your closing and title insurance needs.

Call us for a quote. (727) 848-8113.