Exploring FSBO: Is It the Right Path for Me?
Introduction
I am a licensed real estate agent in New York State. I’ve been selling residential real estate for over 20 years, and see a growing trend in for sale by owner (FSBO) sales. It’s becoming more and more attractive for people to set off on their own without the aid of a real estate agent to sell their homes for a viariety of reasons, the largest being saving the money spent on real estate commissions.
My conventional real estate business is strong, and I’ve been helping more and more people by sharing my experience and expertise.
I wrote this article to help you decide if going the FSBO route is right for you. Let’s find out together!
Key Takeaways:
This article helps homeowners decide if selling their home by owner (FSBO) is right for them by examining the FSBO process, both benefits, and challenges. It’s not for everyone, but if it’s a fit for you, you can save a tremendous amount of money.
- FSBO Process: The FSBO seller manages every aspect of the sale. This requires significant knowledge, effort and commitment.
- FSBO Pros and Cons: While FSBO can save commission fees, it can often lead to a lower sale price than if sold conventionally. However, you still keep more money in your pocket.
- FSBO Legal Requirements: Compliance with local, state, and federal laws is essential. Project FSBO guides you through this process.
- FSBO Marketing Strategies: Effective marketing is crucial for attracting potential buyers. Other articles cover this topic in depth.
- FSBO Emotional Challenges: Selling your home without an agent can be emotionally taxing.
For a detailed analysis and guidance on the FSBO process, continue reading the full article.
Is selling your home worth it?
Yes, it is worth it. Saving thousands of dollars in real estate commission is a powerful incentive to try and sell one’s own home without a real estate agent, but is it right for everyone? There are reasons why approximately 90% of residential sales in the United States involve an agent. This realistic analysis will help you decide if going “For Sale By Owner, ‘FSBO’”, is right for you.
Are people reluctant to try FSBO?
Many people are reluctant to take on selling their own home. I often speak with people who are reluctant to try selling their own home because they are very concerned that they don’t know enough about the process, and with the amount of money so large, they are fearful that the risk is too great to take it on themselves. They also doubt that they have the right personality to deal with being a salesperson.
What are the steps to selling your own home?
Selling your home on your own requires performing pricing research, investing your time in the process and the emotional fortitude to cope with the stress of the both the sales process and interacting with the people you are likely to encounter along the way. Real Estate agents have the tools and the experience gained from many other property sales to perform these tasks efficiently, accurately, and dispassionately. That service comes at a substantial cost to the seller in the form of real estate commission. You must honestly assess your situation and your personality against these criteria to determine if selling your own home is something you are willing to take on yourself.
Is Selling your Own Home as a FSBO Right for You?
The scenario is that you’re considering selling your home on your own without a real estate agent. Saving up to 6% of the sales price by not having to pay a real estate agent commission sounds great. But are you prepared to take over their role and manage every aspect of the process?
No real estate agent by your side
If you choose to go with the “for sale by owner” or “FSBO” option, you, the homeowner manages the entire selling process from beginning to end, without the help or expertise of a real agent. This responsibility and challenging nature of going FSBO may be the reason only 10% of sellers went that route in 2021, according to a report from the National Association of Realtors, or NAR.
Is it Legal for Me to Sell My Own Home Without a Real Estate Agent?
The answer is most likely “Yes, you do have the right to sell your own home without a real estate agent”.
However, you must be sure you comply with all local, state, and federal laws. Selling your home is likely to be the largest financial transaction of your life. With the stakes so high, this is not the time to “wing it” and hope for the best.
PROTIP: Consult a local real estate attorney to find out what the legal requirements of a residential real estate transaction are in your area.
I am a licensed Associate Real Estate Broker in the state of New York. As of this writing, I know exactly what’s required in New York State, but I cannot speak for the other 49 states or for the requirements in other countries.
Question: Do I really “need” an attorney to sell my house by owner?
Answer: Legally, it depends on your jurisdiction, but the answer is YES. YES, you do need to consult an attorney before anything else. This initial consultation is money well spent. You will know for sure what’s required, what you can, and cannot, do, and what your liability and exposure is.
Once you have verified that it’s legal to sell your home on your own without a Realtor, AND you understand the good, the bad, and the ugly about the legal aspect of the process, you’re ready to take the next steps.
Do You Have What it Takes to Sell your Own Home?
Buying and selling real estate can be stressful. One of the most important things that real estate agents bring to the process is emotional support and guidance that stems from having gone through the process hundreds of times and intimately understanding the emotional ups and downs of the process.
This support is not available when you go it alone, and you should be aware of it before beginning the process. But … on the bright side, that’s what Project FSBO is all about. We let you in behind the scenes to guide, educate and support you on your FSBO journey.
Is it Difficult to Sell a Home By Owner, (FSBO)?
It is not easy to sell your own home. It can be difficult, but it can also be very rewarding. You take control of the entire process, and no one knows your home and your requirements better than you do.
What is certain is that selling your own home is a commitment of time and energy. In many ways it can be like taking on a part-time job. If that doesn’t sound appealing to you, consider this. If your house is worth $500,000 and you save 6% commission, that’s $30,000. If you invest only one work-week (40 hours), into the process, that’s $750/hour! Not bad.
What’s Required of Me When Selling my Own Home?
Here are some of the commitments that are required when you become a FSBO. Consider them carefully to see if this process is for you. Don’t be too intimidated, Project FSBO has the resources to help guide you with the entire process.
- Time commitment, potential physical labor
- Time commitment, availability
- Research commitment, learning the market and proper pricing
- Marketing commitment, putting your property out there
- Technical and administrative processes
- Emotional commitment, this is YOUR home
Time Commitment and Potential Physical Labor Required to Sell Your Own Home
If everything is in working order in your home, congratulations, you don’t need to do a thing!
If not, it will serve you well if you bring your house and yard up to the best standards reasonably possible. While you can always sell anything in any condition, time and effort put forth to increase “curb appeal” will pay high dividends in a higher sales price.
Case study
Homes in great shape sell for more money. This should be obvious, but the best way to understand this is to put yourself in the shoes of a buyer looking at other homes. Let’s say you open the front door of a house and the doorknob comes off in your hand. Are you buying that home? Everything else could seem perfect, but if a doorknob comes off, what other problems are there?
Houses in great shape typically sell for at least 10% higher than those in average or below average condition. It’s not so much about the actual cost of repairs, but of the perception of risk that the problems you see are only the tip of the iceberg.
Time Commitment: Availability Requirements to Show Your Home
Are you available at a moment’s notice for a last-minute showing request? How about evening showing requests? In my real estate market Sunday is the “big real estate day”. That’s when there are the most open houses. Are you prepared to commit to the preparation and time required to host your own open houses?
Clearly if you don’t show your home, you won’t sell your home. However, as the seller you are in control of the scheduling. You want to be accommodating to buyers, but if you can’t show your home on a Tuesday afternoon at 2:00 PM, then the potential buyer will have to adjust their schedule to a time that suits you. Just because you are responsible to perform the showings yourself doesn’t mean that you’re at the mercy of buyer’s whims.
INSIDER PRO SECRET: Never mentioned is the fusillade of telephone calls, text messages, and emails that you are likely to receive at all hours of the day and night. If your full-time job lets you go home at 5:00 PM and forget about the job entirely until the next morning, this is the opposite of that. It’s more like having a newborn – they set the schedule, not you. Of course, you can turn off your phone, but you want to maximize your availability to potential buyers.
Research Commitment, The Importance of Properly Pricing your Home
One of the most important aspects of selling a property is to price it properly. It isn’t easy to come up with the right number. Real estate agents have the experience and professional tools necessary to do this effectively.
You don’t have access to professional tools, nor do you likely have any experience pricing a home. The good news is that we can help you with this. Project FSBO has extensive articles and resources to help you with this aspect of the FSBO process.
If research is intimidating to you, you can always simply hire a professional appraiser.to give you a starting point.
Marketing Commitment, Marketing your FSBO Property for Maximum Effect
Many people are unclear about the difference between Sales and Marketing.
Sales are made when the prospect is physically in your home. Marketing is what gets them through your front door in the first place.
This means promoting and advertising your property. You may not have any idea of how to do this, but Project FSBO offers help ranging from writing effective sales copy to how to put it on the Internet.
Useful skills are the ability to manipulate images and generate compelling sales copy for your advertisements and brochures. If this is not your strong point, don’t worry, the goal is not to reinvent the wheel, but to produce assets that are of a similar look and feel to what’s out there already.
Technical and Administrative Processes
This encompasses such topics as qualifying the financial strength of a buyer and being sure necessary paperwork is processed. You are not likely to be familiar with these steps, but for most people it shouldn’t be intimidating. These are skills that can be easily learned and applied.
Like all the topics here, this is just an overview. Project FSBO has the resources you need to dive deep into these tasks.
Emotional Commitment Required to Sell your own Home
This is perhaps the most compelling reason NOT to go FSBO. In my over 20 years of experience selling real estate one thing is common: People’s emotions get turned up to “eleven” during the process.
There is often a lot of stress and pressure, especially when a buyer is critical of your home and when it comes to tough negotiations.
Professional real estate agents have the tremendous benefit of experiencing many transactions, but just as importantly …
It is not their home!
They can be objective. The fact that the potential buyer finds your decorating hideous and wants to demolish your baby’s nursery and make it into a media room doesn’t emotionally impact them. They can keep their focus on the end goal, and not get angry or upset.
Furthermore, as a FSBO seller, buyers tend to push harder since they know that:
- You’re inexperienced.
- You’re not paying a commission.
Buyers want to spend as little money as possible. Your inexperience as a FSBO seller can be seen as a sign of weakness, and buyers will think they can take advantage of this. Everything from price to terms of the deal are negotiable, and if you’re not on top of things, it can hurt your net result.
One of the most common reasons why buyers are attracted to FSBO opportunities is because they know that the seller isn’t paying a real estate commission. From their perspective this savings doesn’t belong just to the seller, but to them as well. They will want a discount in price at the expense of the money you’re saving by not paying commission!
How do you deal with these emotional pressures in FSBO?
The answer is knowledge. Being forewarned about all the likely tactics you are likely to face, and how to counter them is power. Project FSBO provides you with these answers and much more. HEREXXX
Nevertheless, if you are an especially sensitive person who finds it difficult or almost impossible to face conflict, you must seriously consider if going FSBO is right for you. While it rarely gets hostile, you will almost certainly have to negotiate and compromise in order to work with a potential buyer and the fact that this is your own home only makes it more difficult.
Conclusion
Project FSBO has all the tools necessary to enable a homeowner to successfully sell their own home without a real estate agent. But there is a significant time and emotional component to the process, and you must have the fortitude to not let criticism of your home and some potentially hard negotiating stand in the way of your success.
If you don’t feel like you can do this after learning more from Project FSBO, then you should seriously consider listing your property with a real estate broker. However, the good news here is that even if you try to sell it on your own and don’t succeed, you can still relist it with a real estate agent. If you followed all the tips and tricks here at Project FSBO in improving the curb appeal of your home, they alone should make the whole process worth it in ensuring that you will receive the highest price possible for your property, and simultaneously net you the largest possible proceeds from the sale.
What’s Next?
o you want to find out more about if FSBO is right for you? Circle back to the main article for this topic: Expert FSBO Guidance and Education for an Anxiety-Free Home Sale.
You can return to the previous article in the series “Is FSBO right for you?” HERE.
Or jump ahead to the next article in the series: Analyzing FSBO Statistics: Is FSBO A Good Option?.
Frequently Asked Questions (FAQs)
What are the advantages of selling my home by owner?
Selling your home by owner, also known as For Sale By Owner (FSBO), allows you to potentially save a significant amount of money on real estate commission fees. You have complete control over the process, including pricing, scheduling viewings, and negotiating.
What are the challenges of selling my home by owner?
Selling your home by owner can be a challenging task. You will be responsible for all the aspects of selling, including setting the right price, marketing the property, handling paperwork, and navigating legal processes. It may also take longer to sell the property without the network and resources of a real estate agent.
Do I need an attorney to sell my house by owner?
While the legal requirements can vary by location, it’s always advisable to consult an attorney when selling your home by owner to ensure all legal paperwork and transactions are correctly handled.
What are the financial implications of selling my home by myself?
Selling your home by yourself means you avoid paying a commission to a real estate agent, potentially saving you thousands of dollars. However, you may have to spend money on advertising, legal fees, and other expenses related to the sale.
How do I determine the right price for my home?
Conduct thorough research on the real estate market in your area, compare prices of similar properties, and consider getting your home professionally appraised to determine a fair and competitive price.
Will it take longer to sell my home if I do it myself?
It may take longer to sell your home by owner because you may not have access to the same resources and networks as a real estate agent. Effective marketing and correct pricing can help mitigate this.
Is selling my home by owner the right choice for everyone?
No, selling a home by owner is not suitable for everyone. Consider your knowledge of the real estate market, your comfort level with negotiations, and your willingness to handle all aspects of the sale before deciding.
About Me
I am a Licensed Associate Real Estate Broker in the State of New York.
Since 2004, being a real estate broker is my profession and primary source of income. I have successfully completed hundreds of transactions with sellers, buyers, landlords, tenants, and investors totaling over $400,000,000 in sales so far.
My real estate business is strong, and with nearly 90% of sellers opting to use a real estate agent, I am not losing any business by sharing my successful home selling blueprint, strategies, tips, and even advanced negotiation techniques with you. Selling one’s home on their own is not for everyone, but if the prospect of saving thousands of dollars in real estate commission appeals to you, please feel free to explore Project FSBO now and see if it’s helpful to you.