For Sale by Owner, also known as FSBO, is the procedure by which a homeowner sells the home directly without the help of an agent. Homeowners often choose for sale by owner because they want to be in charge of the whole process.
However, as much as it seems like an easy process, it is not a walk in the park. Realtor Spencer Hsu says that buying and selling in the most expensive market in the United States needs to be done strategically and not on pure emotion.
Selling a house involves a lot of activities and responsibilities that one needs to familiarize with. Before committing to sell your home without an agent’s help, you might need to go through the pros and cons as discussed herein.
Benefits of Selling Your House by Your Own
However, as much as selling your house on your own is an uphill task, it has several benefits such as:
Lower Commission Fees
When selling a house with an agent, you are bound to pay commission both to the listing and the buyer’s agents. On average, a real estate agent’s commission is 5% to 6% on the sales price of the home. The wonderful thing about selling your house on your own is it partially saves you the cost of commission paid to the listing agent. You will only pay the buyer’s agent commission which is a significant cut-off on the price.
You Have More Control Over the Sale
Real estate agents significantly influence the selling process, however little it may feel. Sometimes they may push you to settle for deals you are not fully content with. On the other hand, FSBO gives you complete control over the process, a say on the listing price, any adjustment, and the buyer.
If you prefer being in control, for sale by the owner may be the appropriate path for you.
It Saves You the Work of Dealing with a Problematic Agent
As much as real estate agents offer the help, dealing with the wrong one can spoil your entire house selling process. House selling on your own will spare you the hassle of dealing with a selling partner with preferences, negotiation skills, and personalities that differ from yours.
You Can Fully Devote Yourself to Selling Your Home
As you know, real estate agents work with multiple clients at a go. They, therefore, have divided attention when it comes to selling your home. As for selling on your own, you will not have to worry about the attention and time accorded to sell your house. You can dedicate all your time and strength to the sale.
Setbacks of Selling Your House by Your Own
According to a report by the National Bureau of Realtors, FSBOs accounted for 8% of home sales in 2020, which indicated the impact of some challenges they face, such as:
The Risk for Your Safety
Selling homes involves some risky steps like putting personal information on the internet, contacting strangers, and inviting them to your home. Being an FSBO seller, you might omit the steps taken by real estate agents to ensure their safety and, in the end, put yourself in trouble with the law.
You Probably Don’t Have Local Market Expertise
Real estate agents have worked long enough to have established networks and familiarize themselves with the local real estate market more than an owner selling his house. An FSBO seller may therefore have trouble establishing a market as compared to an agent.
You Could Miss Out on Details on Qualifying the Buyer
If you successfully get a buyer, it is equally vital that you ensure they are qualified buyers. Sellers selling their own houses find this challenging since they lack the skills to determine a qualified buyer. Most do not notice the difference between a pre-qualification and pre-approval. This mistake may lead to the seller being banned from the real estate market.
High Probability of Selling on Low prices
Pricing is often top on the challenges FSBO faces. It is never easy to put pricing on the house without a clear guideline on how to go about it. Therefore, most for sale by owner sellers sell their homes at a lower price than the real estate market rates.
Selling your home on your own has both advantages and disadvantages that will help you evaluate whether for sale by owner is the right process for you.