For Sale By Owner ????

By
Real Estate Broker/Owner with Utah Realty 5451933-PB00

FOR SALE BY OWNER??  Why some homeowners try to sell their home on their own. So is this a good idea? Many past For Sale By Owners say  “ this wasn’t such a  good idea”.

Top reasons that sabotage a For Sale by Owner.

1. So many people to keep track of and  Negotiate With people that you must be prepared to negotiate if sale yourself. The savvy buyer wants the best deal possible. The buyer’s agent solely represents the best interest of the buyer (90% of all buyers are represented by a Realtor®). DEAL KILLERS! Home inspection companies. Their job is to find problems with your home! A savvy buyer will then usually ask for a substantial price reduction!  The appraiser, who is blindly selected by the buyers lender often times, will question value.

2. Exposure to home buyers. New studies have shown that up to 91% of buyers search online for a home.  And some experts say that the large sites such a Zwillow and Trueila are notorious for posting old data. And only a tiny percentage is actually there for home shopping. The large sites are mostly just used by people for entertainment.  Most Realtors® have multiple internet strategies to promote the sale of your home. Do you?

3. Results Come from the interweb. Where do buyers find the home they actually purchased? 43% on the internet, 9% from a yard sign, 1% from newspaper. The days of selling your house is not about  just putting a sign in the yard an ad in the paper. It is critical to have a successful internet strategy.

4. For sale by owner selling has become more and more difficult! The paperwork involved in selling and buying a home has increased dramatically as industry disclosures and regulations have become mandatory. This is one of the reasons that the percentage of people selling their own home has dropped from about 20% to less that 10% over the last two decades.

 

5. Netting more money when using Realtor® is actually a true statement.

Save the commission and sale yourself?  Unfortunately the main reason buyers look at for sale by owners is for the same reason, they can save the commission! A sad fact the seller and buyer can’t both save the commission. The buyer just reduces the price what he or she thinks the commission is.

Expert say thought various studies that the typical house sold by the homeowner sells for $208,000 while the typical house sold by an agent sells for $235,000. This doesn’t mean that an agent can get $27,000 more for your home as studies have shown that people are more likely to FSBO in markets with lower price points. However, it does show that selling on your own might not make sense.

In Conclusion

 

You might want to sit down with a Realtor® before you decide to take on the challenge. 

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Lise Howe 11/15/2015 11:06 AM
Topic:
Just for Fun
Location:
Utah
Tags:
utah
salt lake city
by owner
south jordan
utah for sale by owner

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Rainmaker
1,543,305
Sandy Padula and Norm Padula, JD, GRI
HomeSmart Realty West & Geneva Financial, Llc. - Carlsbad, CA
Presence, Persistence & Perseverance

Marty & Laurie Gale All totally concise points you have made in your blog post. Of course there are so many more, but still, many FSBOs will insist they know better. I blame that on the limited knowledge they have gained while surfing the Internet. Too bad for them!

Feb 10, 2015 11:33 PM #1
Rainmaker
804,383
Mel Ahrens, MBA, Kelly Right Real Estate
Kelly Right Real Estate - Hood River, OR
Customized Choices for your Real Estate Needs

Your source, Keeping Current Matters, continues to put this information out every few months.  

Sellers go FSBO because they do not perceive the value of the commission being charged.  It is about the money. The industry needs to be open to providing alternative solutions to meet their needs.  Flat Fee Listings, Hourly Fee For Services, and Real Estate Consulting offer the seller additional choices to meet those needs while saving their equity.  All of the issues mentioned can be addressed by a real estate broker/agent who is open to alternatives beyond the legacy commission compensation system.

As to the last item, Sellers Net More Using a Real Estate Agent/Broker, this is repeated often but is not supported by reality.  Will a real estate broker really generate $27k more on a single house?  No.  Quoting from above, "This doesn’t mean that an agent can get $27,000 more for your home, as studies have shown that people are more likely to FSBO in markets with lower price points.".  Large macroeconomic data (the United States FSBO sales data) does not support the local market; this is a logical fallacy being used to mislead and confuse sellers.

An economic study, which controlled for the local market, specific to Madison, WI, showed there was no difference between sold pricing for FSBO/agents. Certainly not what the NAR and real estate sales industry want to hear, let alone disclose.  Note, the study also has some caveats to the conclusions. 

 

An anecdotal example, actual sales activity: Two similar homes on the same street sold within weeks (33 days) of each other; one FSBO, one agent represented.  House 1 FSBO, 1,140 sq ft, 2 bed 2 baths sold for $224,000, sold June 1.  House 2 Agent, 2 bed, 2 baths, 1,190 sq ft, sold for $224,000, sold April 28.  We will even assume the FSBO buyer had representation, so the only commission savings is on the listing side.  For example sake only, assume 2.5% listing commission.  FSBO property netted $5,600 more.  Certainly not $60,000 more.  And this is not the exception to the rule. I have seen many situations experience similar equity savings.

Jul 11, 2017 01:01 AM #2
Rainmaker
525,554
Dave Halpern
Keller Williams Realty Louisville East (502) 664-7827 - Louisville, KY
Louisville Short Sale Expert

Most FSBO sellers and buyers eventually realize there is a lot more to selling and buying a house than sticking a sign in the yard and going to closing to pick up a check. 

Sep 12, 2017 05:54 PM #3
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Rainmaker
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Marty and Laurie Gale

Utah Realty | 801-205-3500 | UtahRealtyPlace.com
10 Secrets to a Quick Sale!
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