When meeting with prospective buyers, you’ll meet people who’ll challenge the value of hiring a real estate agent. You might be thinking of going through the FSBO route, which stands for For Sale By Owner. But is it a good idea?
A lot of real estate agents discourage property owners from considering FSBO and they have every reason to. It’s not only because they’re losing a job when owners do it, but because they know that it certainly won’t save them money or resources. If anything, it means more misery and responsibility on the property owner’s part. Here are more of its disadvantages:
1. You’re at a higher risk of getting scammed.
Scams happen every day, and they can be experienced by property buyers and sellers who hire an incompetent lawyer. Common scams include fraudulent documents, such as property inspections and loan papers, buyer’s foreign deposits, third-party transactions, and even personal information.
2. You can make a lot of mistakes.
When you sell a property, you must be aware of your liabilities. There’s no room for errors as a property seller. You can hire a lawyer to help you out but all they can do is sign a real estate contract for your house. They do not take insurance omissions and errors. For example, you mistakenly think that your flooring is wood but it’s veneer, then you’ll have to compensate for that mistake.
3. You do all the paperwork.
Understanding property sale paperwork is one of the toughest challenges you’ll encounter. It’s going to be daunting to prepare all the legal documents required. Depending on your state, a lot of legal forms may be required. Examples are real-estate registration, sales contract, home improvement records, and occupancy agreements. Even if you download all the forms online, it can difficult to fill them out accurately and according to the terms of the sale.
4. You may not sell at the right amount.
Statistics show that FSBOs are selling less than real estate broker-assisted properties. FSBO prices are 16% lower than the property’s actual market price. This is because the homeowners who want to sell their properties on their own don’t have the time to engage in the process. They don’t understand the market value, so they fail to sell their properties at the right price.
5. Your property will take a long longer to sell.
FSBO makes property selling a lot longer than usual. If you list your home with a real estate agent, you’ll find a buyer a lot quicker. Don’t sell your property on your own unless you know somebody who wants to buy your property.
6. No one really wants to deal directly with homeowners.
In truth, more property buyers would rather talk with real estate agents than directly with the property owner. They don’t’ want FSBO because there’s no one to turn to in case they encounter problems after the sale of the property. They’d rather want a trusted real estate agent to deal with all the wrinkles and uncertainties. Realtors serve as the professional who will look after their best interest.