For Sale by Owner (FSBO) is a method by in which a property is sold without the use of a real estate agent. There are several sites that cater to owners who prefer to market and sell their homes on their own. It can be a very cost-effective practice or you can land yourself in hot water but all-in-all (if you do your research) it can be an extremely profitable venture. Before anyone decides to go the FSBO route over hiring a real estate agent, we highly recommend reading the below pros and cons associated to selling a house or property privately using this method.
BENEFITS OF SELLING THE FOR SALE BY OWNER WAY…
FSBO can save you thousands of dollars on commission. How does it happen? A real estate agent is paid by commission, usually 1 to 3 percent of the overall sale amount. If your house sells at, lets say $500,000, you owe the real estate agent at least $5000. With FSBO listing websites, you may only have to spend about a fifth of that to list and sell your property, saving you a minimum of $4000. When your house sells, you get to keep the commission in your own pocket rather than sending a cheque to your real estate agent. Below are just some of the “disadvantages” of selling your own home privately.
DISADVANTAGES OF SELLING PRIVATELY
Selling privately will require you to investment some time and effort. If you are a busy person, or if your job entails working long hours and travelling here and there, then taking on another project may not sound like a good idea. But what makes selling privately really challenging?
Your home may have appreciated more than you thought it did and real estate agents will typically create a valuation of your property for free. Before set your price, you will need to learn about the current real estate trends in your area and visit home value sites to create your own valuation. You will have to compare your property with other similar properties in your area to make sure that you are not overpricing, or the opposite.
Inspections & Negotiations
FSBO sites should make it easy for you to market your home but this is the easy part of the process. You still need to conduct open for inspections and negotiate the sale. If you are one of those people who are busy or constantly short on time, inspections can be a real headache. In regards to negotiations, if you are a bit of a shy person, introvert or just someone that has a limited understanding of negotiation, then this method may not be for you.
Paperwork & Documentation
There are a lot of documents that you will need to create or obtain before you can sell the house. Once the deal is done, there is a mountain of paperwork that will need to be drafted and signed by the opposite party. Real Estate agents typically provide these documents for you but if you decide to sell your home yourself, you will need to see a lawyer or conveyancer for these, which will cost you.
TIPS FOR HIRING A REAL ESTATE AGENT
If you think that it may be a little difficult to handle the sales process on your own, you should hire a real estate agent. But not all estate agents have the traits you need for the job. The tips below should help you find the best realtor for you:
Conduct An Interview
Know everything you have to know about the agents you plan to hire. Ask about the methods they will use to promote your property, and how they can keep you informed about the status of the sale.
Ask For References
To know for sure if they are telling the truth, or if they have what it takes to do the job right, ask for references. You can also ask around, and see if any of your friends or relatives has dealt with the agent in the past.
Review The Contract
This is one important thing that you should do before signing. Make sure that everything that you have agreed upon is included in the contract. You should also ask the agent to clarify if there are any areas of the contract or agreement that you do not understand. Ask to revise the contract where necessary.
If you want to know more about how to sell a house yourself, visit the resources section of our website. If you want to find out more about our service, go ahead and check out our FAQ page and finally, if you would like to sell a residential property or commercial real estate, visit their respective pages via the navigation menu of our website.