Thread: Pros and Cons of FSBO need help

Going FSBO is especially hard in this market. In fact, the vast majority of FSBOs finally give up and list with an agent. The market is just too tight right now to try to go FSBO IMHO.

Thanks Mike!!!!!

Is there something unique or special about your house other than you may just think it's special? When I sold my first house FSBO it was because it was one of the less expensive houses in town. In a place where most houses were selling for over $250K, mine was $115K. All I had to do was put out signs and ads in the local newspaper. When I sell my current house in a few years, I will go with an agent because this house is just normal.

If your house can't sell itself in this market, then an agent might be the best way. Of course, you can try selling it yourself for a couple months and see what happens. Just make sure you understand the process, have a couple offer forms available, and know who will handle the closing.

There are many pros and cons of going FSBO. Instead of focusing on the cons and telling you that you cannot do it, I think it is more honest and realistic to say it is possible.

Every good agent could go on and on with many many different reasons not to go FSBO. I could cite reason after reason to use an agent. But it always depends on many factors such as the example clemy gave. It is possible, but in todays market, why would you?

I suggest talking to coworkers, friends, relatives and get their recommendations. Then interview all of them & look at their marketing plan. Do not decide on one over another because they suggested the highest price. Decide on the most honest, professional and realistic agent who shows you the most recent comps, both sold and active, to decide on a suggested listing price.

One of the other items to consider is how much time do you have to market and sell your house? FSBO Owners need to know up front how much time and effort it's going to take to sell your house.

Mario Jannatpour

Originally Posted by jpmull78

Hello,

I live in the NASA Houston area and I am wanting to sell my home that I have been in for 5 years. I have about 55k in equity and do not want to lose any of it to fees. I have to get my kids up the road into a better ISD, and just a few thousand dollars can make a real difference in the quality of home you get down here. I am considering FSBO. Can anyone give me the rundown on pros and cons and the level of difficulty that you think I may experience. I thank you!

I am a real estate agent in the Houston, Texas area. My office is located in Pearland but we service out your way. When you say that you live in the NASA area I am going to assume that you mean Clear Lake. Having been in your home for 5 years and having around 55K in equity I am going to assume that you own a home that is at least at the median home sale value of $160,000. If you are very close to NASA and not just in Pasedena then I would say it is feasible for you to sell your own home if you have the right personality and a very flexible schedule.

When discussing the Pros of selling ones home themselves there is really only two.

1. Save on Commission
2. You feel in control of the situation and do not have to trust anyone else to sell your home.

Now both of those are very strong motivators and push thousands of sellers across the country to make a run at it every year. And I personally despite being an agent can understand and respect when someone wants to save the commission.

The list of Cons is much larger than the list of Pros, but most in and of themselves are not nearly as big a demotivator as are the Pros motivators.

1. Finding yourself in a law suit because you do not provide a property disclosure or improperly filled the disclosure forms out. (This is probably the biggest deterent but also the easiest to avoid)
2. The extremly large amount of time it will consume out of your day to show the house to possible 50-60 people that do not end up buying.
3. The inconvienence of being on the buyers time line and not yours. If you want to sell you must be able to show the property at the time the buyer wants to see it or they will move on with the amount of inventory we have.
4. Having to deal with people making rude comments about your home. Sometimes ones that make no sense because it is strickley personal taste.
5. Using up your time showing the home to someone that is not actually qualified to purchase your home. (You can curb this issue by working with a loan officer that will do the prequalification for you. To arrange this you would have to make it mandatory for the buyer to get prequalified by the loan officer before viewing the house. That will reduce the number of individuals that will even look at your home and some of the ones that will not view the home will be qualified to purchase your home. So, in a slower market that may not be a good idea)
6. You will have to deal with the fact that some of the people that call to view the home may just be casing the home for a potential theft or they could try to injure you as ome people are just nuts. (Attacks on agents and home owners showing houses have been recorded but are realitively rare)
7. Most buyers that will look to buy a home from a FSBO will be trying to save the agent commission as well. And many of them will be professional low ballers. You have to be prepaired to deal with these types without getting discouraged. (This is one of those spots where your personality plays a big roll)
8. You will have to spend money marketing the home without any guarantee that you will get the home sold. (Please do not make the mistake of thinking that you will be able to save the full 6% commission without spending anything on advertising. The stories you hear on this are when the real estate boom was happening and people were driving their cars everywhere trying to hunt down a home for sale in the area they wanted to be in. Right now that is not happening. Trust me it was nice for us agents as well as those selling the homes themselves. Expect that you will put out at least $2,000 in advertising costs. Just be realistic if you are going to go it alone so that you do not end up costing yourself more money in the long run)
9. It will without a doubt take you substantially longer to sell your home yourself than it will for a good agent to get it sold. (This was noted in the most favorable academic study for success of FSBOs. The most favorable study was done by a Economics group at Stanford University. The study was between faculty members that sold their homes themselves and other faculty members that used an agent. The study was during the hot seller's market and all the properties where close to the Stanford Campus which is a very sought after area in California. The out come of the study was that there was no statistically significant difference in the prices but differences in time on market were very large. There was a difference of almost five months between the subject groups. Another thing to note is that these were faculty members who have access to other new faculty moving in and they have very flexible schedules and tend to be very savy people when compared to the general public.)
10. In every study done other than the Stanford study the results showed that home owners that sold FSBO recieved less on average for their home than did those people who listed with an agent. The percentage ranged from as little as 3% less to as much as 11% less. The study that came in at 11% less was done by the National Association of Realtors(NAR) and I believe it to be suspect. I have major doubts about anything that NAR says and I believe that consumers should as well.


Now I do not want to give you the impression that you cannot sell on your own because the reality of it all shows that you can its just that it is not easy. And so you should be prepaired. Make a very detailed plan on how you will market the home just like a good agent would, make sure that you have the time you need to give to the process, and make sure you have a minimium of $2000 allocated to marketing the property. And make sure the numbers make it worth it to you. As only you and your family matter in this decision and no one else.


If you would like a detailed set of directions on how to go about selling your home yourself let me know and I will provide them to you. Oh, and I don't charge for the directions. I am always more than happy to help people out as I enjoy doing so and find that in a round about way I get rewarded for doing so. I have helped many people try FSBO and some of them are able to get their home sold themselves others are not. Most of them set time lines on how long they want to try to sell on their own.

FBSO is only sensible if you are going to heavily market the property yourself. This means more than a yard sign! Keep in mind that the commission a Realtor receives also includes all the money they have spent advertising your property in paper ads, on their website, print outs, showings, etc etc. If you're dead set on going FSBO, you better get a good appraisal first to make sure you are going to be able to get what you are asking. Furthermore, if you get a buyer that agrees on a price higher than the mortgage company's appraiser comes up with, you're in big trouble on the financing site! And lastly, be prepared to spend a good deal of your own time and money marketing the property.