In our years of real estate, the KMS Team at Compass has seen it all. We listen to, offer advice and respect our clients immensely - even when they opt to sell their home by owner. Those that come sheepishly back to ask us to list their home never hear an “I told you so”. Affirming what we already know — we work hard for our clients, they learn several things.
The process is time consuming: No matter who sells your home it still should be prepped properly. Cleaning, purging and sprucing up takes time and energy. Now, tackle the paperwork, advertising, photography and showings too. Professional realtors spend 40+ hours just getting a property listed. There is a learning curve! Most FSBO sellers greatly underestimate the time involved in the process.
Paperwork is overwhelming: Disclosures, inclusion/exclusion considerations, contracts, inspection reports. Knowing what is required is important. Reading, understanding and completing the paperwork is also time consuming, especially without the guidance of someone who uses the forms on a daily basis.
Property received less exposure: Because a FSBO home isn’t put on the MLS and brokerage websites, it gets less exposure and the potential buyer pool is reduced. While a seller can pay a fee to add their property to the MLS, realtors will not be circulating it via email or talking about the FSBO property in office meetings.
Buyer distrust: Many buyers shy away from FSBOs. Without an agent, many buyers think the seller is hiding something. If they do visit and like your home, they are more likely to submit a low offer.
Savings are not as great as expected: Offering to pay a buyer’s agent commission may become part of the negotiations, reducing the perceived savings of “going it alone”. Nearly 75% end up paying a buyer’s agent commission. Advertising, photography costs and MLS fees eat away at what was “saved” by not using a listing agent.
Longer selling process: Without experience FSBO sellers often accept an offer without considering the probability of the sale going through. Is the offer contingent on a mortgage or home sale? Can you access the buyer’s creditworthiness or likelihood that their home will sell in your time frame? Going back to square one is timely and costly. Also, being unfamiliar with the steps involved can add time to the process.
Negotiations: Unrepresented parties are more likely to let emotions cloud their judgment. Little things become big things and a stalemate is likely. Agents, on both sides of the table, help focus the discussion and smooth negotiations.
Money is left on the table: Unfamiliar with pricing strategies, many sellers realize they priced their home too high and then react to low activity by hastily dropping the price too low. Nationwide, according to NAR statistics, “FSBO homes sold at a median of $310,000 last year [2022], significantly lower than the median of agent-assisted homes at $405,000.
Things may work out in the end, but professional guidance can help maximize the value and minimize the stress surrounding your real estate sale.