In another article I made the statement that most people who go FSBO become frustrated [and eventually list with an agent] because they aren't prepared for the challenges and hard work that's involved (Five Steps to FSBO Success). That frustration is feed and intensified by many of the most common FSBO mistakes listed below, most of which are the result of that lack of preparation and hard work.
1. Over pricing. You have to know the fair market value of your home, and that's rarely what you think it's worth! Remember this rule: your home is only worth what a willing buyer will pay for it and no more. What have similar homes in your community sold for? How do the size and amenities of those homes compare to yours? What's your competition doing? How much competition is out there? What are the market trends? It'll take some hard work on your part to find out this information on your own, but you have to know it if you are going to price your home correctly. If you're not comfortable doing this, then pay for a professional appraisal. It'll be well worth the money.
2. Letting emotions run high. You must make the mental transition from thinking "our home" to talking "their house." Your emotional attachment will not only lead you to over price your home, it will make negotiations difficult. Most people will discount their offer because they know you're saving money as a FSBO. Don't become insulted by an offer lower than anticipated. Expect it and use it as a springboard to negotiation.
3. Not being prepared. Due diligence is required if you're going to be successful as a FSBO. Have a good marketing plan. Know how to write a contract. Learn the process from beginning to end so you can anticipate and resolve problems before they occur. Understand the whys and wherefores of home staging and holding an effective open house. Know what's expected of you, the seller. It's a whole lot more than you think.
4. Refusing to make repairs. My advice to all sellers, FSBO or otherwise, is to pay for a professional home inspection and then make whatever repairs are needed to get the home in top condition -- before putting it on the market. If you take an "as is" attitude in marketing and negotiation, you're simply not going to get what your home is really worth. Most buyers will, however, pay top dollar for a house that is "move in ready."
5. Refusing to work with real estate agents. If you don't "protect" agents who bring you a buyer, they're not going to bring you a buyer! That's your choice, but you need to know that over 85% of homes are sold by them. If you really want to sell your home quickly, offer buyers agents a 3% commission. Chances are that a non-represented buyer is going to knock that much or more off what he would be willing to pay anyway.
6. Not knowing the law. There is a FSBO myth that says those selling their own homes don't have to follow the same legal obligations as real estate agents. Be careful! Contract laws, home owner disclosure laws, lead based paint laws and laws that protect a buyer's right for various inspections all apply, no matter who sells the home. For those not using a licensed real estate agent, I always recommended that they consult a real estate attorney before putting their home on the market.
7. Inflexibility of viewing times. Other people work, too. They have a family. Many times they have to rearrange their eating times in order to shop for a house. Yes, there are frequent interruptions, often at some very inconvenient times. But that's part of the job you signed up for when choosing to go FSBO. If you're not flexible in arranging viewings, you'll have a difficult time selling your home.
For more information about how to be successful as a FSBO, read my article Five Steps to FSBO Success.
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