Posted on 08/21/2024 3:12:08 PM PDT by where's_the_Outrage?
No matter if the market is hot or cold, they still pop up: For Sale by Owner listings, otherwise known to Realtors as "FSBOs." These are houses put up for sale by the people who own them - without the help of a real estate agent.
Homeowners who eschew professional assistance can start the home-selling adventure on their own, but are often unaware of the DIY pitfalls. Here are the pros, cons, and everything else you need to know about these kinds of properties.
What to Know About FSBO Listings As a Realtor, I'm very aware of those DIY pitfalls. Take, for example, my neighbor, who has his home back on the market as a FSBO. Third time's a charm, right?
Jeff and Linda Brandt of The Brandt Group in La Quinta, California, have tried to help the guy with pricing and listing advice over the years to no avail. "Jeff told him a realistic price he didn't like," Linda explains. Now, the house is languishing on the market with a high price tag.
My neighbor has ignored the cardinal rule of home selling: realistic pricing.......
My neighbor did advertise on the big Z (Zillow, of course), but did not put a sign in the yard for drive-by prospects. His amateur room photos were dark and blurry, underscoring the marketing importance of compelling images. He then cemented his doom by warning agents off from bringing a buyer by - he insisted on representing both sides of the transaction. Unfortunately, most people won't be comfortable with that setup......
There are some sobering statistics to consider before planting the red-and-white "Home for Sale" sign in the front lawn yourself. Not only do agents avoid FSBOs
(Excerpt) Read more at msn.com ...
I am saying try it and see what happens.
Every state and locality is different.
Naturally, I regretted not knowing about or buying his place instead. I have no idea where he advertised it and hadn't been aware it was for sale. But the price I paid was actually comparable to what other places were going in that neighborhood and what they went for in the building over the coming years. And I sold my place years later for a nice profit.
This guy, on the other hand, got ripped off. He saved his 3% on the agent but lost maybe 50% of the price he could have gotten because he went it alone. I felt very bad for him.
Never “trust” anyone. Its earned, after all. And even then, trust, yet verify.
Nope, no conflict-of-interest there.
Agree. Would you pay this level of commission when selling stocks through your broker?
One of the primary things I’d be looking at a closing on a FSBO sale is “does the seller off title insurance for the purchaser? And how does the FSBO seller handle setting up escrow for taxes, and PMI?
Interesting, I didn't know that. It makes sense, though, since the realtor is burning time and money while the house remains on the market. Of course, a seller can have an interest in a quick sale, too, especially if he needs to close on a new house wherever he's moving to.
Name a time that law has actually been applied. All Sates have such a law, yet, no one is held to it.
No report to relator boards ever results in punishments for relators lying. For one thing, agent/brokers simply claim their clients fills out the disclosure forms so the agent/broker is not the liar.
“3 hours with a real estate attorney for the contract”
No need for an attorney. Agents/Broker use standard forms, so you, too, can use those.
“There are penalties depending on the state, the defect, and if known to the seller.”
Define ‘defect’.
Sales are “AS-IS”, buyer beware. It is why inspections are highly recommended.
“Realtors have legal obligations to not hide anything from you that you want to know about the home.”
Unenforced obligations and lots of ways to play dumb.
“They ARE required on a Disclosure Document to indicate any of over a 100 particular, listed defects and “anything else that could materially affect the value” of the home.”
Those lists are useless since a person’s opinion about their home may not match your opinion, and a buyer is responsible for inspecting the condition of the home, not the seller.
“The idea of a suicide in that house scared you off?”
Except the person did not die in the house unless, in extremely rare instances, a doctor was present to call the death. The dead is transported to the hospital where they are pronounced dead and the property owner does not need to ever say someone died in the house.
A good seller’s agent is worth the money. Our latest agent was worth the cost, but in many transactions they are not. With several homes I have sold both agents were next to useless and one was an absolute hindrance. A standard 6% agents cut is driving property prices too high and is far too much money for many quick or easy sales.
“So—we hired an inspector from fifty miles away—way out of market.”
Smart move. Agents use ‘inspectors’ that support and not torpedo sales. Never use an agent’s recommendation. Never.
Inspectors, too, are never held accountable. They have contracts that simply stipulate “I find what I can, but buyer beware of anything else.”
Besides, a home inspector’s license is not much more than a Saturday afternoon affair. They are not experts in home construction in any way. My dumb little sister got her inspector’s license and she knows nothing of home construction.
“And if the agent was in cahoots, they could loose their license.”
Good luck proving collusion.
The Texas disclosure form is no different than in any other State: Useless.
Define ‘defect’. Any form that simply asks ‘yes/no/unknown’ to ‘any defects or malfunctions’ is open to owner interpretations. The owner simply doesn’t see a defect or malfunction or simply never looked can say, ‘no’ or ‘unknown’. That leaky dishwasher? Never knew. The attic insulation full of vermin poop, never looked. That sliding glass door that leaks, never noticed. That drain that is clogged, didn’t see that as a problem. The fridge that doesn’t keep thing cold, it is cold enough. Electrical problems, never knew, seller isn’t an electrician.
“So you are saying that a buyer without an agent could have made an offer without an agent?”
Yes. Happens every day. There is no law that requires a buyer’s agent. None, not in any State.
“This guy, on the other hand, got ripped off. He saved his 3% on the agent but lost maybe 50% of the price he could have gotten because he went it alone. I felt very bad for him.”
Are you sure he got ripped off. Anyone can see prices in a condo complex, so I am sure he knew the going rates. Maybe he just wanted a quick sale and got it.
FSBO is for the house, the other stuff you mention are on the buyer. Here in Michigan the Title Company basically does the closing and provides the paperwork. The buyer can ask for the seller to pay for Title insurance.
FSBO does not mean the seller will do financing, in most cases they won’t. So taxes, insurance, PMI would be part of the Buyer’s mortgage.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.