HOW REALTORS CAN HELP A FSBO
10 Reasons Why YOU Should List Your Home With a Realtor VS Trying to Sell Your Home on Your Own by Way of a FSBO (For Sale By Owner)
As Realtors, we are always asked to explain to prospective clients why it’s smarter for them to list with a real estate agent, as opposed to attempting a for-sale-by-owner (FSBO) deal? With the invention of the Internet and easy access to listing information and Social Media many sellers think they can successfully sell their home without a real estate agent. However, the exact opposite is true. According to research from the National Association of Realtors’ latest Profile of Home Buyers and Sellers, FSBOs accounted for less than 10 percent of real estate sales, down from a high of 14 percent in 2004 at the height of the real estate market before the market crash. Of that, nearly half of the FSBO sales were “intrafamily” transfers or sales where the sellers already knew the buyers. Meaning when the real estate market was at its hottest in recent history, only 6 percent of sales were FSBO transactions in which the seller did not already know the buyer. (Source: NAR Profile of Home Buyers and Sales)
Here are 10 of the “key” reasons anyone wanting to sell their home should list it with a Realtor.
- Realtors are held to the highest of standards As the title of this blog indicates, it contains ten reasons why you should not attempt to sell your home by way of a FSBO but instead utilize a Realtor when selling your home. We wanted to provide you with the MOST important reason first. Consider this, all Realtors are held to a higher standard and are required to complete nearly a hundred hours of intense classroom instructor lead training and testing that include realtor principles and ethics training. Realtors are required to know and understand all state and federal real estate licensing laws and successful pass a 120-question state and federal licensing exam. The exam covers laws that encompass, real estate brokerage law, FHA, VA and conventional finance options, appraisal law, contract law, estate and tenancy law, the laws pertaining to encumbrances, ownership and transfer of title that allow Realtors to identify and help resolve title record issues. It covers, federal and state fair housing laws allowing sellers to avoid expensive criminal and punitive damages including jail time for any violations of the law that are far more expensive than any commissions you are trying to save by selling the home on your own. For buyers and sellers of property in the low country it is also important to know and understand all issues related to the coastal zone and management laws. All of this knowledge and protection is provided to you as a seller when you list your home with a Realtor rather than attempting to sell property on your own by way of a FSBO. If this is not enough to convince you of the value of utilizing a Realtor keep reading for information on nine other important reasons.
- Print advertising is no longer a major lead generator In the past, newspaper ads would produce a fair number of calls and traffic on FSBOs. Today, a three-line ad in the local newspaper has very little chance of competing with the wide array of information available online, including video, color photos, 360-degree virtual tours, and a wealth of community and lifestyle data that a Realtor can provide you when selling your home.
- Buyers seek rich content Buyers use a variety of free and easily accessible on-line products and solutions, Realtor.com, Trulia and Zillow all provide access to virtually all the listings in most market areas. Most buyers comb these major sites simply because it’s more efficient than searching for single properties. Using a Realtor can get a sellers home prominently featured on scores of these sites and dramatically increasing traffic to your home.
- Instant gratification A third problem for FSBOs is that people who surf the Web usually are seeking instant gratification. In fact, most visitors will only visit a website once and stay for 15-30 seconds. However, a Realtor is skilled at capturing potential lead’s and their contact information for immediate follow up. Even if the Web lead does contact a FSBO, unless the buyer gets back to the FSBO quickly, that lead has moved on.
- Buyers want the savings Even for those buyers who do search for FSBOs, they automatically deduct 6 percent from the sales price of the FSBO because they want the savings in their pockets, not in the wallet of the seller. The result is that many FSBOs end up selling for 20 percent less on average then properties listed with a Realtor who are held to strict standards and have fiduciary duties to their clients to look out for the clients best interest in order to get them the best deal.
- The needle-in-the-haystack effect A major challenge for FSBOs is the needle-in-the-haystack nature of the Web. There are millions of websites including the hundreds of thousands of company and agent sites. Without search engine optimization, meta tags and a host of other branding strategies available to Realtors that achieve high Web placement, the probability of the Web buyer finding your single FSBO listing online is very small.
- Limits to FSBO on-line advertising and resources Of course, the seller could post on sites such as ForSalebyOwner.com, ByOwnerMLS, or utilize the "Make Me Move" feature on Zillow. The challenge is that unless the buyer specifically wants to purchase a FSBO, it is much more efficient for potential buyers to search on the brokerage or MLS sites, which do not contain FSBOs. The FSBO could also put his home on Craigslist. There are two challenges, however. First, the FSBO has to repost the ad regularly for it to appear near the top where it can be found. Second, there have been so many rental scams and unsavory people using that site to identify targets for possible criminal activity that listing there could be a major safety issue.
- Web leads are reluctant to share contact information Another issue FSBOs must face is that most Web buyers are very reluctant to provide contact information to a stranger, especially during the search process. Instead, buyers identify homes they want to see and then normally contact a buyers agent who will then show them everything they want to see, not just a single FSBO home.
- Availability for showings Because FSBOs don’t have lockboxes, that means the FSBO will need to be present for every showing. There are numerous challenges with this situation, the most important of which is safety. Is the person who wants to see your house legitimate or not? Even if you accept an offer from a potential buyer, how do you know whether the person meets the income and credit requirements to close the deal?
- The proof is in the pudding If you think a FSBO is a smart move and the way to go to save money, consider this. The founder of ForSalebyOwner.com, which is one of the most popular and robust FSBO sites on the Web, listed their home with a Realtor and paid a full commission in order to get it sold for the most money in the shortest amount of time.
If you are considering selling your home, please E-mail Rick and Jim with R and J Properties at RickandJimProperties@Gmail.com and us get to work in order to get your property listed and sold for the most money in the shortest amount of time possible. We are here to serve you so contact us today!
Source of other material contained in this blog: Bernice Ross, national speaker trainer and author of the National Association of Realtors number 1 best-seller “Real Estate Dough: Your Recipe for Real Estate Success"