Why Home Buyers Don't Buy from FSBOs
Every year many homeowners elect to sell their homes on their own
without hiring a real estate agent because they believe they can save
money via the cost of the real estate agent's commission. In reality;
however, a surprising number of homeowners discover this move actually
costs them money in the end rather than saving them money. The simple
truth of the matter is that a surprising number of home buyers are
reluctant to purchase homes being sold by the owners, or FSBOs. As a
matter of fact, FSBO homes frequently sell for as much as 15% less than
homes that are marketed by real estate agents.
Home buyers are increasingly reluctantly to consider homes for sale by
owners because these homes have earned a reputation for being
overpriced. Far too often homeowners are not prepared to accurately
price their homes. As a result their homes are often priced higher than
comparable properties in the immediate area. While some people get a
thrill out of haggling, this isn't true for everyone. Buyers who dislike
the idea of haggling over a price may avoid looking at a FSBO home all
together.
In many other cases buyers are concerned regarding the accuracy of the
seller's disclosure. When working with a real estate agent they feel the
agent is more likely to ensure the disclosure is accurate and up to
date. With no agent involved, they lose that reassurance.
Buyers are also reluctant to work with FSBOs because they are not sure
they can trust the home seller to handle all those little details
associated with the process of selling a home quickly and accurately.
They may feel they are in more of a vulnerable position and more likely
to be taken advantage of when working with a FSBO.
You should also buyers recognize the fact they won't receive complete
assistance from a FSBO as they would if they are buying a home sold by
an agent. First time home buyers are especially skittish of purchasing
FSBOS. They know real estate agents can help answer the myriad of
financial questions they may have as well as provide other important
information regarding appraisals, inspections and title insurance.
Besides the fact that you may find it difficult to sell your home if you
elect to do it on your own, you will also typically face other
difficulties as well. After handling a home sale on their own many
homeowners feel the amount of time they had to invest in the sale of
their home simply wasn't worth any money they may have saved in
commissions, if they saved any at all. Selling your home on your own can
require a lot of day to day detail and responsibility that many
homeowners find out after the fact they were not prepared for. Handling
the sale of your home on your own also requires a lot of attention to
legal matters. Unless you are absolutely sure you are prepared to handle
these matters, this could end up costing you more than any money you may
save in terms of real estate commissions.
You should also know that you are placing yourself in a vulnerable
position when making the decision to sell your home on your own. While
some buyers are turned off by the idea of negotiating others tend to
believe sellers are more open to negotiating simply because they are
selling their homes on their own. They may take the idea that you're
saving on the commission to mean you're open to low ball offers. This
can mean your home sits on the market for longer while you field those
offers or even that your home sells for less because buyers are simply
not willing to pony up the asking price.
In the end remember that while it is true selling your home on your own
can save you thousands of dollars in regards to the commission, you may
end up losing more money than this due to buyers' reluctance to work
with you. If you do elect to sell your home without using an agent, do
so wisely. Make sure you understand as much as possible regarding your
local real estate market, research comparable sales in your area to set
an accurate asking price and be sure you understand what will be
required of you in terms of disclosure laws, contracts and agreements.
Hire an attorney to guide you through these matters if you do not
understand them. It can be a small price to pay to avoid trouble down
the road. Finally, if your home does not sell within a reasonable amount
of time, call in reinforcements and list it with a professional agent.
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