Is going For Sale By Owner the right way?
I have heard this many times from relatives, friends and the general public. It is usually the inexperienced who try to sell their property on their own. If you are in a good market and get the right exposure then and only then may it be the right time to go it alone.
I dug up some information from the National Association of Realtors (NAR). I took a look at the 2006 home sellers who threw caution to the wind to “go it alone”. In 2006, just 12% of sellers chose the FSBO (“For Sale By Owner”) route, down from 13% the previous year, according to NAR’s 2006 Profile of Home Buyers and Sellers. In reality only 7% of the market was open market FSBO sales. 40% of all FSBOs sold their homes to someone they knew never becoming a true for sale by owner. 60% are just unrepresented, unprepared and unprotected.
Here is what I mean by unrepresented. FSBOs have no one watching out for their interests. They cannot attract the industry because they chose to go-it alone. In most cases they have no one to step in to fill the gap in the inconvenient moments. What about misunderstanding between the buyer and seller. These problems do arise.
What about being unprepared? FSBOs should really consider the following.
- Safety is really a concern. How do you know who you are letting in your home. I personally interview every potential buyer in my office before I take them to view any properties.
- Contracts and legal concerns. The biggest thing I watch out for on behalf of my clients are the potential "Gotchas". I try to address all the concerns in the contracts to avoid in legal issues.
- Inspections - Is there potentially something in your home that would cause a buyer to back out of the purchase? Where do you turn to find these answers?
- Staging and curb appeal- How do you prepare your house to capture the essence of the home?
- Pricing - If you price the home to high you don't get to the buyers. If you are too low your are losing equity.
Finally FSBOs are unprotected - From safety, to client representation and legal issues most for sale by owner sellers cannot take it all into consideration. This leaves the door open for several problems including law suits.
Here are a few more stats. Of all FSBOs 18% indicated that preparing the home was the most difficult task. 16% had concerns of paperwork, 15% were most troubled by selling schedule.
What about the net income from the sale. In 2006 homes sold by Realtors sold on average for 32% more.
I have not seen all the numbers but I am certain they don't really vary for Huntsville Alabama Real Estate. If you need to speak with a Huntsville real estate consultant give me a call (256) 513-1801.