I see anti-FSBO (For Sale By Owner) articles or blogs on a weekly basis. Generally, the article or blog is justifying why FSBO sellers' are foolish (or worse) not to use a traditional, commission compensated, real estate broker/agent to sell their home.
The following is a blog post by Keeping Current Matters (KCM), whose mission is, "to provide you (the real estate broker/agent) with the tools and information needed to guarantee success in any real estate market". I am a KCM member; they do a good job providing relevant information which helps me in my marketing endeavors. However, I find KCM falling into the same trap as many other real estate writers; they have an old fashioned, legacy driven approach to FSBO's. It is all about maintaining the status quo. At the end of 2016, they published a blog entitled "Top Five Reasons You Should Not For Sale By Owner".
My belief, FSBO sellers' do so to save the commission. It is about the money. Very simply, FSBO sellers' do not perceive the value of the commission payment for the services received.
As a KCM member, I can publish/reprint KCM blog postings and revise as I deem appropriate. Here is a rebuttal, point by point, to "Top Five Reasons You Should Not For Sale By Owner".
1. Exposure to Prospective Buyers (this is the same as “#2”)
Recent studies have shown that 94% of home buyers search online for a home. That is in comparison to only 17% looking at print newspaper ads. Most real estate agents have an internet strategy to promote the sale of your home. Do you?
Rebuttal – A Flat Fee Listing puts the property in the local RMLS. There is a small fee for the flat fee listing, plus you need to agree to pay a Buyer’s Agent Commission (BAC) if a real estate broker brings the buyer who closes on the property. Call me at (509) 540-1309 or (541) 402-1219 to find out more about Flat Fee Listings.
2. Results Come from the Internet (this is the same as “#1”)
Where did buyers find the home they actually purchased?
- 51% on the internet
- 34% from a Real Estate Agent
- 9% from a yard sign
- 1% from newspapers
The days of selling your house by just putting up a sign and putting it in the paper are long gone. Having a strong internet strategy is crucial.
Rebuttal – Options exist for a robust internet strategy. Listing with a real estate broker is not a requirement to implement a well planned and executed internet strategy. A Flat Fee Listing provides a local RMLS listings which all real estate brokers have access to. The listing is also syndicated to hundreds (thousands) of other web sites. Other options exist to generate a strong internet presence. Call me at (509) 540-1309 or (541) 402-1219 for assistance in developing a strong and robust internet strategy to sell your home.
3. There Are Too Many People to Negotiate With
Here is a list of some of the people with whom you must be prepared to negotiate if you decide to For Sale By Owner:
- The buyer who wants the best deal possible
- The buyer’s agent who solely represents the best interest of the buyer
- The buyer’s attorney (in some parts of the country)
- The home inspection companies, which work for the buyer and will almost always find some problems with the house
- The appraiser if there is a question of value
Rebuttal - Yes, there are people to deal with in any transaction, often more than the example shows. Many sellers have bought and sold multiple times, learning about the process each time. Sellers can also hire expertise if needed. Paying a high commission to a broker is not the only choice. Other options exist, such as hourly fee for services. Hire a real estate broker only for the services you need.
I have a Seller’s Real Estate Needs Analysis tool to help identify the services the seller needs and/or wants. Want a copy? Call me at (509) 540-1309 or (541) 402-1219.
4. FSBOing Has Become More And More Difficult
The paperwork involved in selling and buying a home has increased dramatically as industry disclosures and regulations have become mandatory. This is one of the reasons that the percentage of people FSBOing has dropped from 19% to 8% over the last 20+ years. The 8% share represents the lowest recorded figure since NAR began collecting data in 1981.
Rebuttal – Yes, it can be difficult. Buying a car can be difficult too. Research and learning about the process help you be prepared. Again, as mentioned above, Sellers can also hire expertise if needed. Paying a high commission to a broker is not the only choice. Other options exist, such as hourly fee for services. Hire a real estate broker only for the services you need while retaining more of your equity.
I have a Seller’s Real Estate Needs Analysis tool to help identify the services the seller needs and/or wants. Want a copy? Call me at (509) 540-1309 or (541) 402-1219.
5. You Net More Money When Using an Agent
Studies have shown that the typical house sold by the FSBO homeowner sells for $208,700, while the typical house sold by an agent sells for $235,000. This doesn’t mean that an agent can get $26,300 more for your home, as studies have shown that people are more likely to FSBO in markets with lower price points. However, it does show that selling on your own might not make sense.
Rebuttal – This “fact” is a fantasy. Why the real estate industry continues to promote this “fact” is beyond my understanding. On a national, macroeconomic level, I’m sure this a true. Note the bold type in the paragraph above. This is a misleading “fact” which is designed to confuse and mislead the homeowner.
An economic study, which controlled for the local market, Madison, WI, showed there was no difference between sold pricing for FSBO/agents. Certainly not what the NAR and the real estate sales industry wants to hear, let alone disclose.
FSBO sellers generally sell on their own to save their equity; they do not perceive the value of the typical real estate commission. It is about the money.
Bottom Line
Before you decide to take on the challenges of selling your house (with a real estate broker or on your own), let’s get together and discuss the options/choices available to you. I will share multiple choices to save you money (your equity) versus the typical high cost real estate commission.
Know your choices! There are more choices than high priced commissions or FSBO. I can help you identify choices which meet your needs, while saving your equity.
Call or email me to find alternative solutions to meet your real estate needs. My alternative solutions will help you retain more of your equity in your property when you do sell.
