MICHAEL GONICK REALTOR- Coldwell Banker Residential Real Estate.

Often I get the inspiration to write from conversations with my clients.  Currently I have listed this beautiful 2/1 on 2111 Forest Circle , and the owner Bob is apparently impressed enough with what I have done so far to share my name with a friend of his who is considering putting his home up for sale.  Thank you Bob!
Anyway, I haven't had an opportunity to speak with this friend of Bob's (which I would welcome), but it looks like he is going the "For Sale By Owner" (FSBO) route. I think this is a big mistake particularly in a buyer's market like we have now.

2111 Forest Circle Orlando 32803
I can think of only a couple of legitimate reasons why someone might choose to "go it alone"their to sell their house.  One would be  and would be if the property was being donated as charity and the other would be a transfer of a home from one member of a family to another who are on friendly terms with each other!  Other than that, I cannot for the life of me think of any other reason why someone would  choose not to use a full time real estate professional- particularly one who doesn't get paid a cent until the property is sold.  

Here are the top rationals  I have heard from FSBO sellers through the years, and my thoughts on each one.

The Living Room- Forest Circle. 
  •   "I can get more money for my home by selling without a Realtor involved". 
This is simply not so. The typical FSBO home sold for $153,000, the typical salesperson-assisted sold for $211,000 (NAR report, 2010). The difference on average will more than pay for commissions paid to agents used for the sale.  Enough said.

  • "Really all I want to do is put a sign in my yard and throw a high number out there to see if I can get it"
 Well it is a whole new world out there.  In the old days, if a seller and buyer both agreed to a price on a property then the banks had a better track record of loan approval regardless of the cost of the home. (part of the reason we are in the mess we are in today).  Even if a FSBO convinces a buyer to put an offer in at a higher price than the house is worth, if the sale is contingent upon loan approval- the house will not appraise and chances are there will be no sale.  A knowledgeable  Realtor has a better chance than a seller of convincing an appraiser of the value of a home based on the "facts".  Also, if an appraisal comes in short, a Realtor will have a better chance of negotiating the shortfall between buyer and seller to try to make the sale move forward.
Besides, buyers are getting wiser.  They are not going to spend money out of their pockets on home inspections, loan applications etc. without knowing that the price of the home was well thought out.  A Realtor can demonstrate to a potential buyer or buyer's agent that the listing price was not pulled out of thin air.

  •  "With "discount" fee based brokers I can get my home on the MLS....I don't need a full service real estate company."
 Well this may be true, but getting it on the MLS is no longer the "end all".  For one thing, there are a multitude of websites in which buyers are searching the internet on their own.... places that have nothing to do with the MLS such as Trulia.com, Realtor.com, Zillow.com etc.  Here in our Coldwell Banker office we have a list of hundreds of "web partners" in which a home that I list gets automatically uploaded to many of these sites.....many with "enhanced" listings which would cost an extra fee for a FSBO.   Will a For Sale By Owner spend their time and money to advertise prominently on these websites? Doubtful.  Thus, the pool of potential buyers for their property is greatly diminished. Many fee based brokers get paid up front.  If I list your home, nothing gets paid to my broker until the home sells.


  •  "Are you kidding me!  My home is worth WAY MORE than you are telling me! You just want a quick sale."
Like most homeowners,  FSBOs honestly believe their own home is worth more than comparable homes in the same neighborhood. This is based on emotion and usually, they're wrong. When I suggest a listing price on a home it is based on fact-  providing an update on market conditions, an assessment of the likely selling price of the home and tips for improving the home's buyer appeal. Overpricing a for-sale home is a sure way to deter potential buyers. As for the pricing the home low to get a quick sale--- a Realtor would be shooting himself in the foot to employ this tactic.  A good Realtor will hope for a good sale at a good price to show off and attract other people who are considering to list their home.  Listing agents who sell homes on the "cheap" don't last long in this business.

  •  "I don't need a buffer between the buyer and myself....the buyer would prefer to deal directly with me without having real estate agents involved on both sides."
Wrong.  Potential buyers will spend less time in a for-sale home if the owner is present during the showing, and they'll be shy about discussing its pluses and minuses with their own agent if the owner is within earshot. Buyers will also be less inclined to make an offer if they know they'll be negotiating directly with the seller. Having an agent on each side creates an effective emotional buffer between the seller and buyer.


I could go on and on but as a whole, agents, given a choice will show homes that are listed as opposed to FSBO because they know that they will get paid by bringing a qualified buyer to the table (as they should be). That means the pool of potential buyers for FSBO homes is limited primarily to unrepresented and probably unqualified prospects. Dealing with a FSBO means "gray areas and murky situations" for the agent and the client.  Also FSBO's are more likely to run into legal trouble.  Real estate transactions are fraught with potential liability for unwary sellers, particularly in states that have extensive disclosure requirements.. A FSBO who overlooks even one required form or legally mandated disclosure could face a protracted and expensive buyer lawsuit after the transaction closes.  


Besides:
I do this full time.  This is not a hobby for me.
I can negotiate and handle buyers concerns objectively where FSBOs cannot.
I have a pool of resources which can aid in getting the home "show ready" and others that can help a potential buyer with financing, home inspections etc.
I have experience with appraisers and how to get them to understand why your home is as valuable as it is.

In a nutshell, I believe a For Sale For Owner would not want to pay a listing agent who is isn't doing anything to sell their home but stick a sign in their yard. That makes sense!  This is why any potential seller should ask for a full marketing presentation and time line from a Realtor that they might be considering.  A good Realtor should be very comfortable answering "Why are you worth your listing commission?".  Good question.....and a seller shouldn't hesitate in asking it.

So thank you Bob for giving me the inspiration to put into words why For Sale By Owners should at least look at the option of using a Realtor to sell their home.  Granted, maybe sometime in the past a FSBO had a bad experience with an agent.  But we are not all created equal!.  Find an Agent (or 2) that come highly  recommended, get proposals and make a decision.  It certainly cannot hurt.

Do you know someone who is thinking about putting his home up for sale by owner?   Perhaps you might want to put them in touch with me, or share this article with them.  Also if you would like to take a look in person at 2111 Forest Circle please give me a call.  Questions, comments- please do hesitate get in touch.










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