When a homeowner lists their home for sale on their own, without the help of a real estate agent, the listing is referred to as an FSBO listing or For Sale By Owner listing. These listings eliminate the middleman or agent from the equation and are intended to allow the homeowner avoid the high commission fees that are typically required by a real estate agent. While this is definitely one of the perks that a homeowner can expect when he or she decides to list their home for sale on their own, FSBO isn't all as good as it may seem.
For a homeowner, choosing to list the property for sale without the help of a listing agent can have benefits, most notably the fact that there will be no costly listing fees or commissions due when the home sells. In a FSBO deal, you are your own listing agent which means that you will personally take in any profits that come from the sale of the home. Because you will personally meet with each potential buyer, you can be the judge as to whether they are serious candidates and whether they are qualified to purchase your home.
You, the homeowner, will be the negotiator when it comes time to haggle with a potential buyer over the sale price of your home. You can make the final call on whether to accept an offer, counter an offer or back away from the potential sale completely. Sometimes, when you work with a real estate agent you will have to sit on the sidelines and wait and see what your home's final selling price will be, but this is not the case if you are selling the home by owner.
You have the ability to set an attractive asking price for the home and do not have to raise your price by the typical 5-6% that you would otherwise pay in real estate commissions if you had listed your home with an agent. This can sometimes equate to your home selling more quickly and at the price that you originally asked for with all proceeds going to your wallet and not someone else's.
Selling your home will take time, commitment, experience, patience and hard work. Ask yourself this, "Are you ready to take on the full time job of a real estate agent to get the home sold?" When you list your home for sale by owner, you are responsible for:
If you have the time and the patience, listing your home for sale by owner could work for you but to get the most out of the sale you should at least be knowledgeable of the process and be ready to work to get the job done. Many prospective buyers along the way will be "tire kickers" not really ready to buy and really just shopping around. This could waste a lot of your time and quickly wear on your patience so it's very important that you come up with a way to screen potential buyers to eliminate wasted time with those who are simply not ready to buy.