5 Reasons You Should For Sale by Owner (FSBO)
More and more homeowners are taking advantage of the technology-based tools available to help them list, market and sell their own homes without enlisting a realtor. Why? That six percent commission is a big chunk of money to hand over to someone to do something that you can actually do yourself. Don’t be fooled by the naysayers – they’re the real estate professionals who want the commission in their pocket, not yours. You actually can do it yourself, FSBO style.
Think about it – if you’re selling your home for $300,000, your will get a six percent commission from the sale price of your home. That’s $18,000 that you’ll never see—it may be the equivalent of your home’s equity or even more. And for a majority of homesellers, we think there are several reasons it would be a bad idea to hand over thousands of dollars to an agent who has access to the same technology available to home sellers today.
Who says you can’t FSBO?
Keeping Current Matters (KCM), a real estate education firm in Ronkonkoma, New York, claims FSBO sellers shouldn’t try to go it alone for a number of reasons. For one thing, KCM believes that “there are too many people to negotiate with” for ordinary people to even attempt selling without an agent – because ordinary people don’t go through life negotiating with others, I suppose. Apparently negotiating, in the cloistered world of the American real estate industry, is not something homeowners are capable of managing on their own. But when you eliminate the middleman (the real estate agent), you have only two people to deal with!
In a blog written by “The KCM Crew”—apparently the firm’s ghost name for its blogger(s), homeowners should just forget about attempting a FSBO sale, hire an agent and the universe will continue to spin on its axis.
In their blog titled “5 Reasons You Shouldn’t FSBO,” the KCM Crew tells home sellers how it is in the real world of real estate, a world where ordinary people dare not tread. We’re supposed to believe this is rocket science. It’s not rocket science, it’’s not even Biology 101. Anyone can sell their own home.
The KCM Crew kicks off their blog with a warning for all the naïve FSBO home sellers who simply don’t know what they are getting themselves into. Next comes the Crew’s foreboding list of five reasons sellers should abandon the impending disaster that’s sure to come to anyone who attempts to go it alone. Remember, the KCM Crew’s actual words are bolded here to distinguish their deep, immortal wisdom on the subject. The first one is my favorite, and bears repeating:
1. KCM Crew claim: There Are Too Many People to Negotiate With
FSBO Facts: Yes, folks, the KCM Crew warns readers of just some of the people with whom ordinary home sellers must be prepared to negotiate if they attempt to sell their own home without the guidance of an agent. This is not for the faint of heart:
The buyer who wants the best deal possible.Naturally, such an extraordinary expectation would probably be too much for the FSBO seller’s delicate sensibilities. Who would even see that coming?
The buyer’s agent who solely represents the best interest of the buyer. The KCM Crew’s assumption here is that the FSBO seller will be entirely out of their league negotiating with the buyer’s agent. It can only be assumed that the buyer’s agent is the all-powerful Wizard of Oz. Try not to show weakness or fear.
The buyer’s attorney (in some parts of the country). I love it that the KCM Crew sneaked “in some parts of the country” in there parenthetically, hoping no one would recognize a disclaimer when they see one. Anyway, negotiating with a buyer’s attorney shouldn’t be intimidating. Generally, if the buyer’s attorney is negotiating with the seller, it’s to iron out some legal issues he or she anticipates. The seller can always hire an attorney as well if he or she feels at a disadvantage, usually for a nominal flat fee of between $200 and $400.
The home inspection companies, which work for the buyer, will almost always find some problems with the house. Well, if I didn’t know any better I’d think the KCM Crew is suggesting that most home inspection companies are on the take, on behalf of buyers. If a home inspector finds a problem with the house that the seller was unaware of, the seller can get their own home inspector in for a second opinion if he or she believes the home inspector is a nefarious character trying to benefit from an invented problem. Most likely, if the buyer’s inspector found something wrong, it’s legit. Once the homeowner is made aware of the problem, he or she is required by law to disclose that information to other potential home buyers. Of course, the seller may simply opt to fix the problem and call it a day, or work with the buyer to incorporate the cost of the fix into the home’s sale price. Home inspectors, generally, are just doing their jobs.
The appraiser, if there is a question of value.– Oh, come on, KCM Crew! Appraisers are working for the bank that’s lending the buyer the mortgage! The appraiser isn’t going to negotiate with the home seller if it means he or she would be appraising a home inaccurately, which for the record, would mean defrauding the lender—you know, the appraiser’s employer. Appraisers, like home inspectors, have a job to do. That job does not include waffling on a home’s market value. FSBO sellers have the same tools available to them as any real estate agent to establish their home’s fair market value, and most FSBO sellers have done enough homework to understand how it works. Those are the same tools the appraiser uses too. Level playing field. If the home seller has an emotional attachment to the house that leads them to believe their house is worth more than its market value, the appraiser has no choice but to offer a reality check. He or she can’t–and won’t–negotiate market value.
Your bank, in the case of a short sale. OK, granted, short sales can be a miserable experience for home sellers, but paying a real estate agent to negotiate on a home you’re selling at a loss to begin with is just absurd. If you’re in over your head, a real estate lawyer with an affordable flat fee can be a great ally. Unfortunately, with short sales, both the bank and the seller are going to take a financial hit. Contrary to what the KCM Crew says, though, to avoid negotiating the short sale with the lender is never in the seller’s best interest. Suck it up and do what you can. Negotiating with your lender over a short sale simply isn’t a good reason to run out and snap up an agent. It’s time to cut your losses, not pile more on.
The KCM Crew’s blog continues with more reasons not to FSBO, and here they just make word salad to confuse the reader by attempting to make their argument sound like a real thing:
2. KCM Crew Claim: Exposure to Prospective Purchasers. Recent studies have shown that 92 percent of buyers search online for a home. That is in comparison to only 28 percent looking at print newspaper ads. Most real estate agents have an internet strategy to promote the sale of your home. Do you?
FSBO Fact: First of all, rule number one of any type of journalism is “cite your sources.” It’s all about credibility. However, I do agree that 92 percent of buyers search for homes online, and 100 percent of sellers are searching online to see what 92 percent of sellers are looking at. FSBO sellers are using the same sophisticated technology to list and market their homes as the buyers use to find homes. In fact, FSBO sites like ListingDoor.com offer sellers all the savvy internet tools they need to market their homes like a pro. I think the KCM Crew is insinuating that FSBO sellers still think print newspaper ads are the way to go. Hey, KCM Crew, stop besmirching the intelligence of home sellers! They’re smart enough to keep your commission in their own pocket, after all. And their internet marketing strategies are awesome—and usually more awesome than a Realtor’s®.
3. KCM Crew Claim:Results Come from the Internet. Where do buyers find the home they actually purchased?
43 perent on the internet
9 percent from a yard sign
1 percent from newspapers
The days of selling your house by just putting up a sign and putting it in the paper are long gone. Having a strong internet strategy is crucial.
FSBO Fact: Again with the condescending (and unverified) assumptions, KCM Crew? FSBO sellers have adopted dynamic internet strategies! Have you seen Zillow? Trulia? ListingDoor.com? FSBO sellers are not depending on newspaper ads and lawn signs as you claim. Instead, they’re listing their properties online, and they are leaving you in their high-tech, internet strategy dust!
4. KCM Crew Claim: FSBO’ing has only become MORE difficult.
The paperwork involved in selling and buying a home has increased dramatically as industry disclosures and regulations have become mandatory. This is one of the reasons that the percentage of people FSBOing has dropped from 19 percent to 9 percent over the last 20+ years.
FSBO Fact: Your figures are patently false, KCM Crew. FSBO sales have been steadily on the rise over the past 10 years. Your figures come from a National Association of Realtors (NAR) report that was swiftly and effortlessly proven to contain doctored numbers and omit chunks of pertinent facts so that the report reflected what the NAR wanted people to believe. Now, aren’t you ashamed of yourself for quoting inaccurate figures from a distorted report, custom crafted by the NAR? I’m embarrassed for you.
As for the paperwork, which isnot too overwhelming for the ordinary home seller to handle, if the home seller would like help with it an attorney can handle the paperwork for about $300. Get over yourselves.
5. KCM Crew Claim: You net more money when using an Agent.
Many homeowners believe that they will save the real estate commission by selling on their own. Realize that the main reason buyers look at FSBOs is because they also believe they can save the real commission. The seller and buyer can’t both save the commission. Studies have shown that the typical house sold by the homeowner sells for $184,000 while the typical house sold by an agent sells for $230,000. This doesn’t mean that an agent can get $46,000 more for your home as studies have shown that people are more likely to FSBO in markets with lower price points. However, it does show that selling on your own might not make sense.
FSBO Fact: KCM Crew, what would you say if I told you the entire content of your point #5 is preposterous? First of all, your claim that people are more likely to FSBO in markets with lower price points is just plain false. Homes in the FSBO market come in all markets and price points, including those priced at more than $1 million! Imagine the commission savings those sellers enjoy! In addition, it makes no sense that a Realtor®—any Realtor®—could really out-profit FSBO sellers to the degree you “professionals” claim, especially when you claim that’s including commission. In fact, Economist John Wake wrote a fascinating blog that exposes the NAR’s manipulation of facts and figures to try and convince their fast-shrinking client pool that realtors do it much better, when in fact, they don’t. Here’s a link to Mr. Wake’s revealing exposé inReal Estate Decodedof the NAR’s sleight-of-hand shell game with facts and figures.
FSBO home sellers are standing up to the NAR, who have spent decades brainwashing homeowners into believing they’re not capable of selling their own home. Anyone can sell a home, whether you’ve done it before or not. Online tools and strategies, and sites like ListingDoor.com provide all the tools a home seller needs to be successful. Search engines are packed with carefully crafted press releases and blogs just like this one from the KCM Crew – a NAR-fueled marketing strategy to saturate all media with their anti-FSBO scare tactics.
The truth is, no one needs to hand over thousands, even tens of thousands of dollars to an agent when the tools are available to them to sell their own homes. If you’re juggling work, a family and constant travel, or if you need to move next week and you just found out last week, then sure, a Realtor® might be what you need. But if you have the time and the focus to learn how to do it yourself, and the commitment to save thousands of dollars on an agent’s commission, skip the agent and enjoy the adventure.ListingDoor.comwill help you every step of the way.