When it comes to selling a home, you have two realistic options.
The first, and most popular, is to go down the normal route and hire a real estate agent or agency. The other, and lesser popular, is to go solo. This is called an FSBO. FSBO means For Sale By Owner, and it essentially removes the real estate agent or agency from the equation.
But why are people selling their homes FSBO-style? Well, that’s exactly what we’ll explain in this article by looking over the 4 benefits and drawbacks.
So with all that said, let’s start.
Benefit Number 1: You Are In the Driving Seat
When it comes to selling a home, a real estate agent can take care of the whole process. For many people this is a good thing, but not for the lone wolf.
FSBO allows you to pick a price and choose who can come in and see the house. You are in firm control and you are in charge of the whole process. If you don’t like selling to someone, you can very well do so. Bottom line is that you make the decisions as to how much the house will cost buyers.
Drawback Number 1: Emotional Interference
The whole purpose of hiring a real estate agent is to assist you and aid you throughout the selling process. They will recommend a price and they’ll be in charge of managing visitors, open houses, etc.
This disconnects you from the whole process. In addition, it removes any emotional connection you have with your home. It’s safe to say that many homeowners hold very fond memories of their properties. From birthdays to anniversaries, family breakfasts, etc, all of it can interfere with your objectivity.
And by doing an FSBO, there is a very strong chance that you will lose the objectivity needed to properly price your home.
Benefits Number 2: No Commission Fees
The number one reason why hundreds of thousands of Americans are selling their homes FSBO-style is because they don’t want to pay the commission fees imposed by real estate agents or agencies.
On average, a real estate agent charges 5 to 6 percent of the total sale. This can be upwards of $250,000 in some cases. That is a lot of money, but do remember that you’re paying for a very valuable service.
When you don’t go with a real estate agent, there is no commission fee and you get the money for yourself.
Drawback Number 2: Real Estate Agents Are Worth the Commission
Make no mistake about it; saving 5 to 6 percent might sound like much, but it is money well spent. What many people fail to recognize is that those 5 to 6 percents give you plenty in advance. It is a real estate agent’s job to do what you ask them to do, but it is also their job to advertise your home and sell it as fast as they can. They offer a service that can get you a higher price than what you initially thought.
Many sellers say that 5 to 6 percent is well worth what you get in return.
For many sellers looking to do go FSBO, there is an option that is fast, reliable and asks for no commission fee. Namely, there are services out there that will buy your house in its current state and do it in a very fast manner. For more information on that, make sure to visit www.cashquickbuyers.com.
Benefit Number 3: If You’re An Expert
It’s safe to say that many homeowners are experts in real estate and thus can afford to go down the FSBO route. This is perfectly fine if that’s the case. But expertise is an area where FSBO greatly puts homeowners at disadvantage.
If you have significant marketing, negotiating, and real estate skills, then you can call yourself an expert and go ahead with the process on your own.
Drawback Number 3: If You Lack the Expertise
If you have no prior experience in real estate, then going FSBO will require you to either learn along the way or do it beforehand. There are plenty of aspects that need to be taken into account. Things such as strategy, sales expertise, negotiating, and even understanding the legal forms required to go ahead with a sale of a home are all factors that need to be taken into account.
A real estate agent has all the expertise and experience needed to overcome these obstacles.
Benefit Number 4: There Are Plenty of FSBO Resources
We did mention that you’ll need to learn how to become an expert to go down the FSBO route. Luckily for you, there are plenty of resources out there that allow you to do just that. From YouTube videos to blog posts, like this one, and even Craigslist can be of great service. You can very well advertise your home on your social media profiles. This makes it free and very effective if you get your friends to join in and help you out by sharing your posts.
More so, statistics say that most FSBO sales are done in rural America. This means you might have to learn a thing or two about it as chances are a real estate agent will not be an option.
Drawback Number 4: It’s A Slow Process
And lastly, we come to one of the most annoying issues related to FSBO sales; the slow process.
Regardless of how much you read and learn about it, you are still not an expert. Agents are trained to be fast as it works for both of you. The faster an agent finds a seller and makes a closing, the faster they get their commission fee. More so, you also get done with it much faster and can plan your next move.
By going solo, it can be difficult to find the right buyer, go through the negotiating process, and do all the paperwork. Another issue is the fact that you will need to schedule certain types of inspections before you can close the deal.