“For Sale by Owner” Considerations
“For Sale by Owner” Considerations
When it’s time to sell your home, it’s time to make the decision on whether you want to sell it yourself or whether you want to hire a Realtor. Of course, you know I’m a bit biased since I’m a Broker, but hear me out. Real estate contracts and negotiations can get complicated—that is what an agent’s job is—to solve the problems. Going FSBO may be the right choice for you, or hiring an agent may be the right choice for you. Consider this when making your decision:
- Devote the Time– Selling your home will take time out of your schedule and it will sometimes be inconvenient. Real Estate is 24/7, as they say. Buyers may want to look at the property with very short notice, or they can only view it at a certain day/time. You have to get them in to see the property, otherwise they won’t buy it. It is a commitment and to make it work, you must use your time to sell the house. You’ll need to answer and return phone calls, sort the buyers from the looky-loos, schedule appointments, meet vendors such as inspectors and appraisers, prepare the contract forms, liaise with the lender and title company, along with any other tasks related to selling the property. It all takes time and time is valuable—just make sure you have the time and patience to devote to it.
- Saving Money!—This is, of course, the biggest reason most folks decide to sell it without an agent. Yes, you will save the commission…but make sure you are putting that money in your pocket! Some buyers (and investors) view FSBOs as a “deal source” because they know they are saving a commission, and the price may be under market value, so they want in on the savings too. According to the 2017 National Association of REALTORS® Profile of Home Buyers and Sellers, the median sold price on a FSBO home was $190,000 compared to a median sales price of $250,000 for agent-assisted transactions. It may not be typical for every deal, but be hyper aware of your bottom line, because there is a lot on the line. If the numbers work, fantastic; but look at the big picture—don’t lose thousands just to save on a commission that may be less than what you’ve left on the table during negotiations anyway.
- The Price is Right–Setting the price of your property is, of course, of ultimate importance. Even a billion dollar marketing budget won’t sell an extremely overpriced home, so don’t set yourself up to fail with erroneous pricing. It literally pays to know the comparable sales and active competition so you are in prime positioning within the market. Pricing must be looked at objectively, as the house is no longer your home but is now a commodity with a price tag attached.
It’s not an easy job, no bones about it. When you go “For Sale by Owner,” you’re all on your own. You are the contact between yourself, the buyer, title company, bank and any other vendors involved. The regulations and laws are always changing and the laws still apply to you, even if you are not an agent. Familiarize yourself with the process and any required paperwork. For some, selling by owner is great choice, but for others it is not. It is important to do some research on everything required before you make the decision. If it is the best choice for you, go for it! Agents make it look easy, but selling real estate is a full time job and more—you won’t be paying a commission, but there is still a cost.
Lisa E. Priest loves real estate (no matter what kind of sign is in the yard) 😉 and is an East Texas Broker/REALTOR® in Palestine, Texas with Picket Fence Realty, Inc. You can reach her via phone or text at 903-948-3343 or read more at BuyPalestine.com.