If you are selling your home this year, you may be wondering if you should sell your home on your own. Each year, there are sellers who choose to do this. It is called For Sale By Owner or FSBO. According to the National Association of REALTORS®, 8% of sales last year were FSBO sales, down from 9% the previous three years. Of course, the advantage of selling your home yourself is saving commission – which sounds appealing. However, there are drawbacks to selling your home FSBO that are also worth considering if you are weighing your options.
In 2015, 37.5% of the FSBO sellers knew the buyer. Situations could be a parent selling to a child, a friend selling to another friend, or even a neighbor buying from a neighbor. Really only 5% of total sales last year were a result of a seller putting a For Sale By Owner sign in their front yard.
The median sales price of FSBOs in 2015 was $210,000 while the median for agent-assisted transactions was $249,000.
The most popular methods to market the home in instances where the seller did not know the buyer included posting a yard sign (58%), marketing to friends, relatives, or neighbors (28%), third party aggregator (31%), social networking website (19%), for-sale-by-owner website (22%), online classified ads (20%), and open houses (17%).
The most difficult tasks for sellers who did not know the buyer included selling within the length of time planned (8%), having to devote time to the sale (8%), and understanding the paperwork (15%).
In terms of overall satisfaction with the selling process, in instances where the seller did not know the buyer, 33% indicated they were only somewhat satisfied, somewhat dissatisfied, or very dissatisfied.
Here is some other math to consider: On the agent-assisted median sales price home, real estate agent commission may be around $15,000. Of course, saving $15,000 sounds good, but there are expenses that the seller could now incur which could include: sign, creating and printing the house flyer, creating and sending out just listed postcards to the neighbors, posting the listing on a website that supports FSBOs and creating a website for the home, open house advertising, professional photography, and the cost for an attorney to draw up paperwork.
In addition, there is a cost of not putting the home on the MLS where it is seen by the largest pool of buyers and agents looking for homes for their clients. It is also possible that a buyer who is already being represented by a real estate agent approach the seller in which case, the seller may have to pay the buyer side commission. Finally, without an experienced real estate agent providing pricing and negotiation expertise, thousands may be left on the table.
Although there are situations where it makes sense for the seller to sell their own home, there are many factors to consider as it is often not in the sellers’ best interest. If you would like to learn more and discuss your options, please contact me at 206-730-0962 or send an email to email@example.com.