To FSBO or Not to FSBO: There Is No Question

By
Real Estate Agent with Jeff Fritzson Real Estate, Ebby Halliday Realtors 0629874

FSBO in Frisco: Is it worth the effort?

Right now in Frisco TX and many areas in north part of the DFW Metroplex we are experiencing the best seller's market ever. That means more people are going to start contemplating selling their homes. The next question they think of is can I sell it on my own. After all this is the hottest seller's market ever. How hard can it be to sell a $200,000, $500,000  or even a $1,000,000 home? Let's take a quick look at pros and cons and for a more detailed look you can check learn more here.

FSBO Pros

Yes you can save some money if all things were equal but they are not. When you are selling your home with me and my broker, you will pay 6% as a listing fee. This fee also pays for the buyer's representation as well. If you sell it on your own, you do not have a list fee or at least not that much. You are in total control of setting the price, when to show your home, how to advertise, where to advertise, how to present you home, contacting any handymen, photographers, inspectors, title people and many other things. You are in complete control of this highly regulated transaction. When you represent yourself, you get to decide everything.

FSBO Cons

Financial

According to the NAR (National Association of Realtors), only 11% of all homes are sold by owners. 89% of FSBO sellers end up using a professional Realtor®. In addition, homes sold by professional Realtors sold for 20% higher than those sold by owners. Just with those two statistics, the FSBO route costs more. If you beat the odds and become one of the 11% that do sell on their own, you would still have to overcome the dramatic difference in higher sales price that professional Realtors command.

Other financial areas to consider are the costs of marketing your home. You will have to pay for all your marketing whereas, marketing is one of the biggest advantages of a Realtor is that their marketing costs are paid for by the agent not the owner. The marketing process in a good broker's office is quick and offers a wide variety of methods. Utilizing the internet, MLS, social media, internal agent networks, external agent networks, and various medium are all ready to receive your listing at no cost to the owner.

Risk

In today's world, you just never know who is going to come knock at your door. A FSBO sign alerts everyone, even the less savory characters, that your home is for sale by owner. BY setting up an appointment to see the home as a buyer, you are allowing them easy access. When you work with a broker, you have an lock box that requires someone to have a key which are only professional realtors or those service people who have been cleared to have access. You do not have to meet any buyer. In addition, the buyers that agents bring are typically pre-approved and they can afford your home.

The other risk is the actual process of the sale. Without knowing all the forms, addendum and disclosures, you run the risk of litigation during and after the process. A professional realtor guides you through all the details and handles all the paperwork for you. This minimizes your risk and exposure to litigation.

10 Questions to Ask Yourself

Can you...

  1. Market this house on your own?
  2. Attract the best size market to get the best offers?
  3. Negotiate against a professional realtor representing a buyer?
  4. Price your home correctly?
  5. Learn what forms are required and how to fill them out?
  6. Make the time to meet every buyer to show your home?
  7. Schedule all the trades that need access to your home?
  8. Prospect other networks to find potential buyers?
  9. Can you prepare our home for sale with regards to clutter and staging?
  10. Find a good professional photographer to take pictures of your home?

When you add up all the money you might save and compare that against the costs of marketing, the risks of showing your home and filling out the documentation, and the scheduling of all this time for showing and other services needed, the choice still remains yours. Whether you want to choose to gamble the time, money and risk to sell your home on your own or decide that a professional realtor will do a better job for you by getting you a higher sales price feel free to contact me. 

As a FSBO I will provide you whatever information I can to help you overcome some of the challenges you will face. As someone you want to sell your home I will do a great job for you in North Texxas or recommend someone who can to a great job for you somewhere else in the nation.

When you do decide that you want to work with me, you will find out what the rest of my clients have found—Your Success is My Focus.

close

Re-Blogged 3 times:

Re-Blogged By Re-Blogged At
  1. Kathleen Daniels 05/19/2014 12:29 PM
  2. Gene Riemenschneider 05/21/2014 03:04 AM
  3. Winston Heverly 12/31/2014 12:07 PM
Topic:
Home Selling
Location:
Texas Collin County Frisco
Groups:
Active Rain Newbies
Realtors®
Frisco Texas Real Estate
"Whacked"!!!
Bananatude
Tags:
for sale by owner
house selling
frisco tx
fsbo

Post a Comment
Spam prevention
Spam prevention
Show All Comments
Rainer
278,096
Ron Aguilar
Continental Mortgage - Saint George, UT
Mortgage & Real Estate Advisor since 1995

If a seller initially thinks of saving money, it's your job to help them sort out the pros and cons. With that said, a specific skill set is needed to educate these people without sounding like a sales person.

May 21, 2014 12:03 AM #29
Rainmaker
1,057,302
Sharon Parisi
United Real Estate Dallas - Dallas, TX
Dallas Homes

The risk of post sale litigation is another factor to consider before marketing your own property. Hiring a lawyer can be costly.

May 21, 2014 12:05 AM #30
Rainmaker
1,737,467
Lottie Kendall
Compass - San Francisco, CA
Helping make your real estate dreams a reality

You did a great job of explaining the pitfalls of FSBOs

May 21, 2014 12:19 AM #31
Rainmaker
1,509,298
Marte Cliff
Marte Cliff Copywriting - Priest River, ID
Your real estate writer

I do think potential buyers see "bargain" when they see FSBO. The sellers are saving all that money and should be willing to share.

May 21, 2014 12:43 AM #32
Rainmaker
624,323
Mike McCann - Nebraska Farm Land Broker
Mike McCann - Broker, Mach1 Realty Farmland Broker-Auctioneer Serving Rural Nebraska - Kearney, NE
Farm Land For Sale 308-627-3700 or 800-241-3940

I definitely believe in the free market system.

I show FSBO's if so requested by my client.  I will even point them out to my client.

I find that paperwork is less tedious when only one agent is involved.  I also find that there is less ego involved and less time wasted on minor issues.

FSBO definitely is not for everyone...but if they want to try...and understand the pros and cons...then have at it. 

When I was doing exclusively houses, I eventually listed many of those FSBO's who wanted to try.

I even see it a little in the farm land market and can't say I blame them.

Are there pitfalls?  For some yes...just as there is when listed with some unqualified but licensed agent or some high volume listing agent who tries to squeeze just one more listing under their belt.

May 21, 2014 01:59 AM #33
Rainmaker
1,431,110
Gene Riemenschneider
Home Point Real Estate - Brentwood, CA
Turning Houses into Homes

This is a great post.  FSBO!  Would you do your own Brain Surgery to save money?  Why would you not use an expert to handle the most important transaction you may ever make.

May 21, 2014 02:58 AM #34
Rainmaker
222,932
Liane Thomas -Top Listing Agent
BROKER Allison James Estates & Homes BRE 01885684 - Corona, CA
Bringing you Home!

I had an elderly FSBO robbed when a nice family stopped to view his home. The husband distracted him while the wife took the wallet and the money. He hired me the next day.

May 21, 2014 06:33 AM #35
Rainmaker
327,672
Dana Basiliere
Rossi & Riina Real Estate - Williston, VT
Making deals "Happen"

Jeff,

Well said! We all have some good stories about FSBO failures and worse. There is still a contingent out there who think they know more than the Realtors; and there always will be. The other side of the coin is when a fast talking big smiling FSBO seller talks an unsuspecting FSBO buyer into paying too much. 

That's a whole other post subject; FSBO buyers being duped. A few years later when they go to sell they are in trouble because they over paid.

May 21, 2014 09:52 AM #36
Rainer
82,764
Jim Miner
Miner Noh & Associates - Phoenix, AZ
Loan Modfication & Short Sale Specialist

And then the kicker to all is NAR did a study that showed the average selling price of a home is 16.9% higher when a realtor does the deal vs. a FISBO.

May 21, 2014 10:29 AM #37
Rainer
82,764
Jim Miner
Miner Noh & Associates - Phoenix, AZ
Loan Modfication & Short Sale Specialist

Oh, and another tidbit, the founder of the FISBO website had to end up hiring an agent to sell his home.

May 21, 2014 10:30 AM #38
Rainmaker
368,638
Travis "the SOLD man" Parker; Associate Broker
Team Linda Simmons, Enterprise, AL 36330 - Enterprise, AL
email: Travis@theSOLDman.me / cell: 334-494-7846

EXCELLENT article!! I've bookmarked it for ideas when talking to FSBO's.

THANK YOU!!

May 21, 2014 11:55 AM #39
Rainmaker
797,159
Troy Erickson AZ Realtor (602) 295-6807
Good Company Real Estate www.ChandlerRealEstate.weebly.com - Chandler, AZ
Your Chandler, Ahwatukee, and East Valley Realtor

Great explaination on the difference between selling a home FSBO and working with an agent. I think that most people don't realize all the features and benefits of working with an agent, and feel like in a sellers market, "How hard could it be to sell my home on my own." Like your post says, only 11% end up selling on their own, and the other 89% eventually find a realtor.

May 22, 2014 03:22 AM #40
Rainer
96,912
Jeff Fritzson: Frisco Real Estate Pro
Jeff Fritzson Real Estate, Ebby Halliday Realtors - Frisco, TX
Your Success is My Focus!

Hello -

I have read each and every one of your comments and am grateful for the response. Taking the time to not only read but comment on a blog is time consuming and I want to thank you for taking the time to respond to my post.

There are some great comments and I thought I would some up some:

1. Bottom line is most people are trying to save some money to sell on their own but the major majority of the time that is not what happens.

2. Negotiations are always tougher when trying to negotiate with a buyer directly or negotiating with an agent representing a buyer.

3. FSBO buyers are looking to save the same money the seller is trying to save.

4. The number of people that are attracted to FSBOs are far less for many reasons. WHen you reduce your market, you reduce the number of people who might possibly make an offer.

5. Fewer offers typically mean lower offers.

 

Thanks again to everyone who contributed.

May 22, 2014 04:02 AM #41
Rainmaker
1,505,944
Gary L. Waters Broker Associate, Bucci Realty
Bucci Realty, Inc. - Melbourne, FL
Fifteen Years Experience in Brevard County

Buyers I have spoken with in the past view "FSBO" as really discounted or way over the top. Never had one say they bought one and it was just right...like the three bears.

May 22, 2014 09:41 PM #42
Rainmaker
496,265
Mary Hutchison, SRES, ABR
Better Homes and Gardens Real Estate-Kansas City Homes - Kansas City, MO
Experienced Agent in Kansas City Metro area

Some FSBOs are successful..most are not.  It depends on the seller.  I do think most of them eventually realize that selling a home can be a lot more complicated than they thought

May 23, 2014 06:40 AM #43
Rainer
144,447
Gordon Wood
Canyon Ridge Realty LLC - Scottsdale, AZ
480.226.2842

Great job Jeff well written and to the point.  Thanks for the information. Cheers

May 24, 2014 12:48 AM #44
Rainmaker
650,891
John Juarez
The Medford Real Estate Team - Fremont, CA
ePRO, SRES, GRI, PMN

Great post, Jeff. 

We know that there are those home sellers who can be successful selling without professional help. That has always been true and always will be. They are a very small percentage of the market.

May 24, 2014 11:08 AM #45
Rainmaker
725,330
Pete Xavier
Investments to Luxury - Pacific Palisades, CA
Outstanding Agent Referrals-Nationwide

Simply put, don't be penny wise and pound foolish!

It's easy to fall into that trap without realizing the full benefits of professional representation.

Dec 31, 2014 12:38 PM #46
Ambassador
4,298,246
Praful Thakkar
LAER Realty Partners - Andover, MA
Andover, MA: Andover Luxury Homes For Sale

Jeff Fritzson: Frisco Real Estate Pro isn't it a no-brainer? However, different people think differently and hence, we have valid points to prove!

Dec 31, 2014 03:18 PM #47
Rainmaker
279,502
Mike Reyman
Berkshire Hathaway HomeServices Fox & Roach Realtors - Media, PA
Delaware County Real Estate

What a help!  Just battling with a stubborn (that's polite!) seller and I pulled up this and a few other articles about FSBO Failure and won him over.  Not sure I will survive (LOL) but I certainly appreciate the blog post to get me in the door!

Feb 28, 2015 06:05 AM #48
Post a Comment
Spam prevention
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainer
96,912

Jeff Fritzson: Frisco Real Estate Pro

Your Success is My Focus!
Your success is all that matters. Contact me.
*
*
*
*
Spam prevention

Additional Information