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 ...
“Agents are under a microscope from the NAR as well as their state and local governing authority.”
That is laughable. No, they are not under a microscope. They can lie, cheat, and steal and never lose their license.
Which is why my offers were contingent on the home inspection and appraisal.
The previous home I bought the seller and I negotiated over the phone, agreed on a price and went forward. It was nice to deal with an honest man. Yes there were some issues but we both easily worked it out.
They only get paid when you write the check.
When I bought my current home the commission was $18,000, or $9k to my agent. The only reason I used her was I couldn’t bargain for a listed home without an agent. I was already approved for financing, had insurance, and picked the home. The agent got $9K just because I had to use her.
One thing that really pissed me off is that her offer contract included an additional $500 to the seller agent. WTF?
I have bought sold and had built many homes. One home I bought and sold 10 times. I think I know the process.
” but it should be “time and materials” like most any other contract, not a percentage of the sale price.”
+1 The percentage is a total rip-off which is what FSBO on the internet is doing so well getting around the MLS monopoly.
Which does not always stop them. They can look the other way and claim they were unaware of problems which are as plain as daylight. You had better know what you are doing when you buy a house under any circumstances.
Caveat Emptor.
Also realtors care much more about speed of sale than realizing the ultimate price if it takes longer. A bump of 20k in your final sales price will only net them an extra 600 bucks at 3%.
But to the seller, 20k extra in their pocket might be preferred.
The book Freakonomics detailed how realtors take several weeks longer to sell their personal houses than the ones they list.
On the last house I sold myself the inspector found a cracked main beam, wow what an issue. Luckily my new neighbors set me up with their cuz that did that work, he fixed in the less than a month and the house sold. Plus I got the insurance to pay for most of it.
The unawareness is hard to prove. How do you prove the realtor’s home inspection report simply missed something or there was a deliberate attempt to hide what was wrong?
I listed my house at $230K that I bought at $200K 18 months before. A realtor told me he could get $250K if I listed with him. I got $225K 2 months after I put as FSBO and was very satisfied with the deal. Don’t let greed get in the way.
Home inspectors work with real estate agents. If home inspectors start killing sales the real estate agents will make sure they are not used much.
You don't.
You just lost in this episode of the house-buying game. Think of it as expensive tuition and do not make the same mistake the next time. There is always a next time.
Once you have learned what you are doing and who you should be doing it with, these problems do not come up very often.
Realtors are on a normal curve.
The top 10% are worth every penny they are paid—and do an outstanding job.
The bottom 10% are a menace—and are to be avoided at all costs.
Most are in the middle—ok but can make mistakes or have oversights from time to time.
The trick for the consumer is finding one of the top 10%.
Word of mouth in the local area is probably the best way.
That is tough for out-of-towners who lack local contacts.
My buddy told me a about his friend that contracted to list his home and as his agent was pounding in the for sale sign a neighbor came over and bought the house.
Whether true or not does not matter, putting up a FSBO sign for a weeks may be a really smart thing.
But another realtor buddy told me had agents have to work hard to get buyer loan qualified.
IMHO: 1. If you don’t have time to show your home you need an agent.
2. If you have no experience in buying a home and have credit issues, you might need an agent.
There's the reason the apartment isn't selling.
A seller can get on the county property tax web site and find comparable properties to their own house along with appraised values. Of course, what the seller, an appraiser and a lender think may be different things.
Hire a good real estate attorney for advice and forms, you don’t need someone to drive you around, hammer a sign in the ground or introduce your buyer to a mortgage broker—for only 7% of the sales price. Cut the Realtor® out. Useless.
“I fired her on the spot.’
Back in the 90’s I was looking at $300 - 500K lake front homes, and set up viewings with a buyer agent. When we got to the home she couldn’t open the lock box because it was in a different county. I fired her afterwards. I didn’t need incompetence in the transaction.
“Their only interest is to close the deal. It’s how they get paid.
Never go with the top agent, their motivation is close the deal, not do what is best for the customer.
As an aside, never go with the #1 doctor that invented the procedure as they are selling themselves and don’t have quality patient time. Look for the 3rd best.
” I’ll wager FSBO sellers are sued a lot more frequently.”
Which is why the seller puts “as is” in the contract.
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