‘For sale by owner’ is a property where the owner hopes to sell this property without employing the services of a real estate agent. The acronym used for such ownership is ‘FSBO Ownership’. FSBO ownership also has few advantages, but in general the disadvantages associated with FSBO ownership far outweigh the advantages. Various surveys suggest that only 6-7% of properties are sold through this mechanism.
Let’s look at the disadvantages associated with a FSBO property for the seller. This involves spending a lot of time and effort arranging for this sale. You have to go around organizing anything regarding the price of the house, making the property available for prospective buyers to inspect, running classified ads in magazines and newspapers. The marketing and advertising costs sometimes exceed the brokerage commission and thus it becomes a losing proposition. FSBO property is available for offer to a limited set of buyers, unless you choose to list it on the Multiple Listing Service, which also has a fee attached. When you take the help of a professional, your property would benefit from much more marketing exposure and technical input than a real estate agent brings to the table. Without complete technical details, it is very likely that the owner does not have a fair knowledge of the real price of this property and, in most cases, tends to overvalue his property. An overvalued property fails to attract buyers, and as time goes on, the value begins to decline. The other significant disadvantage of FSBO property is that the brokerage community is reluctant to work with FSBO property.
Let’s examine the set of activities required to run a FSBO property. Start by having your home professionally appraised to get the right price for your home. Quoting the correct price is the most important thing in the liquidation of your property. Visit all open days. Word of mouth works well in this industry. Make sure you do little things to make your home attractive. Make sure all the accessories work well. Try to do a fresh paint job if possible and remove all the clutter. Hire the professional services of a lawyer who can carry out all the paperwork and carry out the sales contract. Get ready to do all these activities by yourself.
FSBO ownership will require you to be good at each and every aspect of selling the property, whether it be negotiations, financial and legal knowledge, or housing law. Lack of knowledge in even one of these areas could ruin the opportunity to sell your property. Better to leave the work of an expert to an expert.
FSBO ownership was a huge waste of time and money. These could very well be handled by a professional real estate agent. Most of the time it becomes an exercise where you spend dollars to save a dime. FSBO is a challenging task and yet one is not sure as a seller if all the effort ultimately translates into any monetary benefit considering the expenses involved in doing everything yourself.
