5 Reasons Why For-Sale-By-Owner is a Bad Idea

For-sale-by-owner, or FSBO for short, is when a person sells their home without the assistance of a licensed real estate agent. Most commonly, people decide to go it alone to avoid paying an agent’s commission, thereby saving money. While it’s certainly your right to sell your home on your own, there are several good reasons why FSBO is a bad idea. Below, we’ll explore these reasons and let you know how an agent can help. 

You May Not Know How to Properly Screen Potential Buyers

Because you’re not trained in real estate dealings, you may not know how to properly screen potential buyers to ensure the right people are viewing your home. First, many homeowners don’t think to find out if a buyer is pre-approved for a loan or not, which lets them know of a buyers’ ability to purchase the home. 

When you have an agent helping you sell, she will screen potential buyers to ensure your home is what they are looking for, as well as whether they are pre-approved or not. 

You May Not Have Time to Deal with Inquiries

When you go FSBO, you are the only person capable of handling buyer inquiries. Returning phone calls, scheduling showings, answering questions – buyers and their agents expect you to take care of these things as quickly as possible. 

With an agent, you don’t have to worry about such things as it’s her job to deal with questions and scheduling on your behalf. Furthermore, since she will handle the viewings, potential buyers will feel more comfortable asking questions without you – the seller – hovering nearby. 

You May Not Know How to Properly Price Your Home

This is probably the biggest reason FSBOs fail. Most homeowners who decide to go the FSBO route price their homes too high, causing the property to sit unsold on the market for longer than it would have had they taken the advice of a real estate agent. 

A real estate agent knows how to price homes correctly and will help you determine the correct asking price based on a comparative market analysis (CMA). 

Marketing is Limited with an FSBO

Homeowners don’t have access to the multiple listing service (MLS). Only licensed real estate agents can post homes for sale there. The MLS sees the most buyer and seller traffic of all methods of marketing, so without that service, your marketing methods are very limited. Most FSBO sellers simply place a sign in their yard and hope for the best. 

With the help of an agent, your home will receive more exposure on the MLS, increasing your chances of selling your home quickly. 

The Average Homeowner Doesn’t Understand the Paperwork

When you decide to sell your home on your own, you become responsible for understanding the complicated paperwork involved in the process. Much of this paperwork is time-sensitive as well, making it even more confusing and overwhelming. Unless you’ve been sufficiently trained, you’ll likely not understand all the real estate jargon used in these documents. 

A real estate agent has been trained in the terminology and the paperwork involved in buying and selling property. She will make sure everything is completed on time and help you understand anything you find confusing.