Selling a house is exciting. Some sellers love getting hands-on. It’s one thing to DIY the living room paint job and another to attempt a sale by owner (FSBO). Like any property deal, there are FSBO pros and cons to consider.
So, is it worth it to take on an FSBO sale on your property? Let’s take a closer look at the option.
What is FSBO?
As the name suggests, an FSBO is a home sale by the owner of the home—no real estate agent or broker. Sometimes you’ll see a “For Sale by Owner” sign on a property yard. This means the seller is marketing and selling their property on their own.
Selling a home is an attractive prospect for your clients, as there’s no commission for a third party and no scheduling viewings around a realtor’s schedule. What home sellers don’t always see is the amount of work that goes into marketing and selling a property.
FSBO Pros and Cons
Homeowners should do their research.
Understanding the pros and cons involved presents a clear picture of the FSBO value. Here are some FSBO pros and cons to consider:
CON: Less Money for Your Sale
On average, homeowners who sell without realtors sell properties for less. When you consider you could be missing tens of thousands on a sale without a realtor, it makes up for that commission check.
PRO: You Call the Shots
Selling your own house means you choose whether to stage the property. You also choose which photos to use and which days are convenient for showings. You design your own property marketing strategies. No working around anybody else’s schedule.
CON: Legal Requirements Could Be Missed
Real estate contracts are full of fine print and easy-to-miss details. Working with a professional ensures you don’t cross any lines that could result in real estate litigation later. A breach of contract is a big deal in real estate. Failing to abide by fair housing requirements could result in thousands of dollars of punitive damages.
PRO: You Choose the Buyer
Whether you’re sentimental about the property or you already have a buyer lined up, FSBO lets you choose the buyer. You get to do this in some regards with a realtor as well, but there’s no pressure from an outside party to make your choice.
CON: Standard Procedures Could Be Misinterpreted
You may not understand what is standard procedure in a real estate transaction and may seek to terminate the contract over issues that are commonplace (such as timing and extension on mortgage commitments.
PRO: Standard Procedures May Proceed More Quickly
Because the parties can talk to each other rather than through a broker, the buyer and seller may negotiate terms that professionals might shy away from.
FSBO Property Marketing Strategies
If you choose to sell your property on your own, there are a few ways to streamline the process.
1. Get a great real estate lawyer on your side
2. Price your home based on its current market value (but be competitive)
3. Don’t forget to stage
4. Don’t take the first offer (negotiate)
5. Take care of the legal side as it happens (don’t leave paperwork to the last minute)
Working with a realtor offers the best chance at the best price for your home. If you choose to go with the FSBO sales model, but finding a top real estate lawyer to back you up can keep you out of trouble, help you understand standard procedures and help you get the transaction closed.