Selling a home without the help of a real estate agent – also referred to as being a FSBO or “for sale by owner seller” – has often been perceived by those home sellers who prefer doing so as beneficial in many respects. Chief among those benefits has always been the amount that would have to be paid in the form of an agent’s commission, which the homeowner would not be required to pay out, thereby “saving” or keeping the money for personal and other uses.
In addition to the above there are other reasons, many which have been deemed beneficial, a home owner might decide to sell his/her home or investment property without a real estate agent. Among those reasons or benefits are:
• Reduced price for a faster sale
• Direct negotiations with buyer
• Pressure-free marketing & selling
• Higher percentage of asking price
Reduced price for a faster sale
Some home sellers realize – since they have once been buyers – that a home buyer’s goal is to make the best deal (paying the least amount of money) on a home they possibly can, the same way most home sellers expect the highest price for the home they are selling; and accordingly the price of a home with the real estate agent’s commission subtracted is in many cases more attractive than a price including the commission. Based on this understanding the home owner derives a benefit by offering the property for sale at the reduced commission-less price in order to get a faster sale.
Direct negotiations with buyer
Home sellers who prefer to enter into direct negotiations with their prospective buyers are in full control of whatever outcome(s) those negotiations produce, and they accept responsibility for that. However, the benefit(s) derived from direct negotiations is having the knowledge of each stage of the transaction involving their homes instead of waiting for status updates from an agent who is simultaneously dealing with several homes – and the buyers of those homes – involved with just as many transactions. A FSBO home seller is free to contact the buyer to inquire about anything pertinent to the transaction; and this can sometimes be significant in a variety of ways.
Pressure-free marketing & selling
Home sellers who have not committed to a real estate agent – verbally or in writing by way of an exclusive listing – is under no obligation to “show the property during reasonable hours” as many who have listed with agents have agreed to do, lest they leave themselves open to claims of “refusal to show,” “uncooperative,” or “taking the house of the market,” all of which are claims that can be worrisome, but were often used by eager and highly motivated real estate salespersons to convince a home seller to provide access to his/her property during a time the salesperson had, what s/he considered a well-qualified, interested buyer. The absence of this kind of pressure during the marketing and sale of a home is the condition under which fsbo sellers consider beneficial to them.
Higher percentage of asking price
In a March 2011 article titled, ‘How to Sell Your House Without an Agent’ and edited by Real Estate Career Hub, et al., it is stated that, “A 2008 Consumer Reports study found that nearly all homeowners in their survey who sold on their own got their asking price, while sellers using agents received an average of $5,000 below their asking price… ” and “… National Association of Realtors figures show the average sales price for by-owner sellers was 97.5 percent of their asking price – while sellers with agents got just 95 percent.”
This data can be supported by the price having been already lower than it otherwise might be had a real estate agent’s commission been included; but also the seller’s net price is often adjusted lower – in bare dollars and cents figures – than the dollar amount represented by the commission percentage, so that when negotiations to adjust the selling price downward is conducted by the agent, and the commission percentage remains in tact, the percentage of a seller’s asking price is affected more.
One circumstance that has arisen in recent years, due to the mortgage crises is, more home owners than ever found themselves “under water” (owing more that the home’s value). This is even more reason why getting the highest percentage of an asking price is so important to today’s home sellers.