For Sale By Owner (FSBO) Tips & Advice

FSBO’s and the expired listing

Did you ever notice the phenomenon where a house was listed with a real estate company and sat unsold for months, re-listed with another, then magickally sold? Often there are various reasons behind this but the main premise is that the listing became stale and it took the re-listing of it to gain peoples interest. If you had a lazy real estate agent and your listing expired then you can create this regained interest and sell your home for sale by owner. The best thing to do is to take it off the market for a few weeks, maybe even a month, make some minor price changes, gear up your advertising and bring it back on the market as a new listing. There is no reason if your home is priced competitively that you can’t sell it within a reasonable amount of time without the use of a real estate agent.

Negotiating FSBO Deals

When selling for sale by owner you never really know who your buyer is and what they are up to. Most people that look at your home will be ordinary people just looking for a house. But, some will have a great deal of real estate knowledge and will try to tie you up with some crazy deal with terms or other devious methods. They may seem meek but really are a wolf in sheeps clothing. This is where you can really get into trouble. The best way to deal with such situations is to NOT sign anything until you have a chance to have your lawyer or notary look at the deal. This way your interests will be covered and can move forward with some peace of mind. The sharks out there will try to pressure you and want you to commit to a deal immediately, don’t do it! No real estate deal is that important that it can’t wait 24 hours until you have a chance to check it out.

FSBO Selling - Avoid Lowball Offers

When you are selling your home by owner some buyers feel you are prime for a lowball offer. The best way to avoid this pitfall is to get a independent home inspection and an appraisal done before you put your home on the market. This will put you in the drivers seat.

A home inspection done by a licensed professional will reveal any imperfections which you can get fixed pre-sell. Also, this shows that you are not trying to hide anything and all facts are out in the open. Many buyers will try to get their own inspection done and when items are discovered will try to attach a price to each and attempt to reduce the sale price accordingly.

An appraisal will handle any questions regarding price. Home appraisals are based on comparative sales and usually are quite accurate. I take more stock in an appraisal done by an independent company rather than a real estate firm. Home appraisers don’t have a stake in the deal so generally their opinion is believable.

Make sure when you are dealing with purchasers that you make the inspection and appraisal available and then you both will be dealing with concrete facts which can then be negotiated.

FSBO Tips

As a for sale by owner the best weapon you have is time on your side. If you are not in a hurry to sell and have a few months, there is no reason you can’t sell you own home if it’s priced well. However, FSBO’s might consider using a realtor when you are going to buy a house in a different city. This is one of those situations where you will be at a disadvantage about the market conditions, amenities etc. Certainly with the internet you can educate yourself so when you arrive for your house tour you will have some idea what’s going on. You must realize that stepping into a new market “cold” should be treated with caution. Not all brokers will have your best interest at heart, it’s just a commission for them and a house for you. The best agent you can use is one that keeps the lines of communication open, often! A good broker will do a lot of listening and will find houses for you based on your unique situation. Make sure you are not doing all the work and they are only available to open doors.

What about the fsbo sign?

Next time you are out with your real estate agent and see a home for sale by owner ask him, “what about the fsbo sign”. Then, watch him sweat. He will say, for sale by owners do not represent good value, if you go fsbo you will not get my expert advice - blah blah blah. Bottom line is if you buy a home from a for sale by owner, he will not get paid. But what if this house is the right one for you? Does your realtor have your best interests at heart or is he just a commission whore?

Ask your realtor?

Real estate agents say their “system” of exposure and expertise is the basis of why you should list with them instead of selling privately. But I would ask this question to any broker or homeowner. If 2 houses were in the same neighborhood and comparable in everyway and one was listed with ABC realty at $300,000 and the other at $287,000 for sale by owner, which one would you buy? The only difference is the price, one with the commission and the other privately. I think for any reasonable person the answer is clear, why should you pay more if you do not have to. If you are a FSBO and a real estate agent is bothering you, explain this scenario and ask him, which one would you buy? If he would buy the for sale by owners house, then he does not really believe all the “hype” about him and his real estate company. Really, it comes down to price.

No Obligation Market Evaluation?

The no obligation market evaluation is the oldest and most unoriginal term you will see advertised by real estate agents. Do they think people are stupid? The real definition should be, “yes I will come over to your home, tell you what it’s worth, then I will bug the hell out of you until you list it with me. In the meantime they will send you some “awesome” fridge magnets, calendars and pencils just so you don’t forget them. The no obligation market evaluation or CMA is the biggest come on for listings that ever was. Usually reserved for the unexperienced and non successful real estate agents that have nothing better to do. I had this guy bugging me to do a market evaluation for my home which I was selling by owner. So I said sure, but do a VERY comprehensive job and be at my house by 7.00. This guy showed up with charts, graphs, a wireless laptop and lots of other nifty equipment. He went on for an hour or so about him, his company and what my list price should be. Bottom line, he confirmed that my price was bang on, I already had an appraisal and knew this anyways. Now the pitch, do you want to list with me? I said no I’m selling by owner. I told him, “you contacted me and said you would give me a no obligation market evaluation, notice the word no obligation”. The guy left, obviously pissed but that is too bad. My advice to him would be, don’t lie and try to be sneaky and you might last a few years in this business.

If I could, would you?

Here is something you will get from real estate agents if you are selling your home by owner. If I could, _______, would you________. They teach them this useless tactic to use on private sellers. Usually it goes something like this, if I could, bring you a full price offer in a short period of time would you pay me a commission? And endless variations keyed to get you to commit at least verbally to some kind of proposition. The most important point to remember is, this is just a tactic on some hypothetical situation to see how far they can push you. My answer would be, “if i put my foot up your ass, would you leave me alone”.

Should you sell your own home?

Take away the real estate agents circular logic & semantics it comes down to a few simple things.

Do you want to extend the effort to sell your own home, time, money, phone calls, dealing with buyers etc.

And what is your timeframe? Do you need to sell in a month because of an emergency, bought another home or perhaps you were transferred? If this is the case you might consider using a real estate broker as you do not have the one thing a FSBO needs and that’s time on your side. If you are in a pinch and need a realtor, employ a successful one. One that is a specialist in your area with the most experience, a support staff, and a proven step by step plan. If you put your faith in an unexperienced, lazy or tricky broker then you will just add more stress. In this case you want to make sure you are bang on with your price, you are not in a position to gamble.

On the other hand if you have time on your side and can price your home realistically there is no reason why you can’t sell your own home within a reasonable amount of time. Perhaps at least save the commission or earn “a little of it”.

Certainly market conditions will also dictate how long it will take you to sell. Everytyhing seems so easy in a hot market but when things tighten up this can influence many factors. So it is wise to clearly evaluate your situation and market conditions before you list it for sale.