In a 2006 National Association of Realtors survey, only 7% of sellers sell their homes without a licensed broker. Homeowners trying to sell their own homes, also known as FSBOs (For Sale by Owners), will have many tasks to perform that they may not be familiar with. The property valuation is just the beginning; time, marketing, home preparation, negotiations and many other things are obstacles that the owner must investigate and overcome in order to be successful.

Benefits

First of all, when an owner sells the house, the real estate commissions are non-existent. These charges can add up to 6% of the home’s sales price; this equates to $12,000 on a $200,000 home. Another benefit is the personal interest that the owner has in the sale of the house. Real estate agents often work to secure a quick sale without worrying as much about the price or the terms of the contract. The owner can set their own hours for viewings and can openly negotiate with a potential buyer without the hassle of sending documents back and forth.

Multiple listing service

The Multiple Listing Service (MLS) is a national marketing tool that all licensed agents use to share listings and find buyers. Previously, sellers who did not use an agent did not have access to the MLS. FSBOs can now list their home on the MLS using one of the many websites that offer this service for a fee.

Advertising

There are many new real estate services online that are specifically tailored to the FSBO market. For a reasonable fee, the property is posted online with photos and virtual tours. Zillow.com, ForSalebyOwner.com, and homesbyowner.com are just a few of these sites. Along with this, open houses, full-color brochures, newspaper ads and real estate circulars, and personal networks are advertising tools that can lead to a home sale.

challenges

The homeowner hoping to sell a home without the help of a broker will be faced with more work than he thinks. To price the home correctly, the homeowner must research recent sales and home prices in the area. The landlord must also be aware of state laws and regulations on fair housing, housing disclosure, sales contracts, and sales negotiations. Financing can also be a confusing category, so a homeowner needs to know how to approach this topic with a buyer.

warnings

Buyers’ agents are often reluctant to work with homeowners trying to sell their own homes, even if the home is listed on the MLS. Also, buyers tend to bid lower on FSBO homes because they know the owner is saving money on sales commissions. The National Association of Realtors reports that most homeowners trying to sell their own home eventually hire a realtor, mainly because buyers often use agents.