When you want to sell your property yourself, without engaging the services of a real estate agent, such a property sale is called a ‘For Sale By Owner’ or FSBO property.
Although FSBO has advantages, you should also be aware of the many drawbacks that it can bring with it and this is applicable for both sellers and buyers. Let’s take a look at the downside of both aspects.
as a salesman
As someone who opts for FSBO, here is a look at things that may be of concern here:
FSBO property selling property is quite cumbersome: while enjoying the freedom of working alone without the interference of a broker, you are faced with an uphill task to sell your property on your own. You have to put in a lot of work to make it happen: research work, pricing your house, posting ads, screening applicants, holding open houses, showing off the property, etc. This, at all times, seems like a heavy load on his shoulders.
emotional attachment: You have an emotional bond with your property and value every little detail of it. This has its own dangers –
1. You tend to overprice property
2. You tend to describe minute details of your home much to the irritation of the potential buyer when you show the buyer your property.
Also, you find it very difficult to market your house as a product, to speak in that “marketing language” that is required to satisfy buyers.
Lack of market, legal and financial knowledge: Being a property owner and not a real estate broker, you do not have the knowledge you need to have to facilitate the sale of a house. Not only are you unaware of market conditions, prevailing prices, the prices of similar homes in your locality, but also all the other legal and financial issues that go along with it.
Waste of time – There is a lot of information available to you at the click of a button through the Internet, but you do not have time to navigate the huge network and also completely confused by the enormity. All this research work, the task of choosing where to place ads, how to place them, what to write, etc. it takes a long time. Investing so much time is difficult.
limited exposure – If you use the services of a real estate broker, your property will be shown more and you will have a greater exposure than if you sell it yourself.
High prices – Even though you feel that by selling your house on your own, you can reduce the costs that the real estate broker would take for that purpose, you actually end up spending more! Advertising costs are enormous. Many real estate brokers include costs in their services; you get it as a package. Also, you incur costs for placing ads, opening bank accounts, doing research, etc. Above all, there is the cost of losing your peace of mind over the sale!
as a buyer
You are attracted to a FSBO since in this case you are not required to pay the real estate commission. Here’s a look at the issues you should be aware of:
I’m not sure about the property: As a potential FSBO buyer, you are unsure about ownership of the FSBO. The person who has listed the house for sale may only partially own the house and the other owner may not really be interested in selling it!
I’m not sure of the price: Since FSBO homes are typically overpriced and there is no agent involved, you don’t know the market and therefore don’t know the ideal price for the property to help you negotiate well.
Not realizing the flaws: Since the owner is putting his house up for sale and values every little bit of it, he won’t hold the prospective buyer short. This creates a difficulty since the latter is deprived of the right to know all aspects before deciding to buy.
Without knowing the technical details: The owner of a FSBO house does not know the exact measurements: the total area, the carpet area, the dimensions of each room, section, etc. Therefore, he/she will not be able to provide you with details about the same!
Devoid of expert advice and help – the job of a real estate owner is to make it easy to buy and sell homes! From time to time he offers his expert advice that a FSBO homeowner cannot provide! You can think about property in a neutral, non-judgmental way and therefore can value it. Also, a broker assists the buyer throughout the entire process, including interpreting the agreement, handling registration details, etc.
