by Buz Wolfe
A 2014 study by the National Association of Realtors confirms that Agent-assisted home sales typically are 13% higher than For Sale by Owner sales (FSBOs). This is really impressive! Most folks choose the For Sale By Owner (FSBO) route to “save” the commission. While commissions are negotiable, they generally range in the 5-6% range. Obviously, the use of a Realtor MORE than covers the cost – – by a wide margin, actually.
There are other reasons why the FBSO route rarely works. Nationally, and historically, only 10%-20% of For Sale By Owners are actually successful. Why?
First, many buyers are inheritantly suspicious of a FSBO property. They suspect that there may be issues that persuaded the owner not to list with a Real Estate Broker.
Second, buyers are frequently suspicious of the manner by which the asking price was arrived. While many FSBO’s over price their properties, the statistic referenced above suggests that many actually end up selling their house for too little.
Third, buyers frequently are reluctantly to deal directly with the seller. They prefer to engage a qualified “middle man” to represent their interest in the transaction.
Fourth, most For Sale By Owner deals fall apart because neither the seller nor the buyer have any idea what to do after they agree on a sale price. Contract preparation and the maze of conditions that must be met to get to the settlement table is far above the reach of most private parties.
Fifth, with over 95% of prospective buyers now getting on internet sites before contacting a Realtor, it is almost impossible for a FSBO to gain the kind of exposure available through the multiple listing and websites dedicated to real estate properties.
I have always respected anyone’s right to try and sell their property privately. There is, however, a very good reason that less than 2 out of 10 are successful. Realtor assisted transactions benefit the seller in many, many ways.
And, remember. Not all Realtors are created equal. EXPERIENCE MATTERS!
*Ray L. “Buz” Wolfe, CRS has been Broker/Owner of his own firm since 1986. In 2014, he was again the Carlisle Area’s Top Producing Broker with $10,000,000 in settled transactions.
**All information believed to be accurate but not guaranteed.