Walter, reading your response comment, I have no doubt that you could handle your FSBO with some confidence.

Do you really need a listing agent... no, of course not. Full service agency isn't for everyone. Most people don't feel comfortable marketing their homes, dealing with the public, making appointments, pricing their homes, and handling negotiations and the aftermath all the way to closing. But for those that are comfortable with the plethora of typically unfamiliar duties... more power to you.

btw... if you do a little more research, I'm sure you can find a resource that will put you on your local MLS for waaaaaay less than $700.00

Good luck.

rockinblu:

I posted my comment BEFORE I saw yours - I opened up the dialogue box, started to answer, got interrupted and finished my answer a while later. I actually thought I was the first to respond - was surprised to see two comments before mine.

As for hardline NAR ... not so much.

Dunes and rockinblu.....As always, great common sense input.

Walter, I have no doubt you will make the right decision for you based upon your thorough research. Do keep us posted.

Best wishes,
April Tavares, GRI ASP
Realtor, DRE License #01742179

Hey Walt,

I just read your very articulate post. I have a feeling that if you say you know your market, you know your market. I am also positive that if you decide to go FSBO, the extent of your marketing will not be throwing a sign out front made out of a piece of cardboard attached to a tree branch stuck in the ground with 4 sale scibbled in crayon on it. I think you are intrigued by the challenge, and there isn't any doubt in my mind that you would put forth a great effort, providing you have the time. And to repeat myself from an earlier post, good luck on whatever you decide, and please keep us posted.

Walter, when you say you know the market, what do you mean? Do you mean you know listing prices? Selling prices? Length of time on the market? Have you been inside other homes so you can compare the amenities they have to yours? The size of their kitchens, baths, basement finished or not? If you have time and you want to try to sell it yourself, then good luck!

Whether a seller, or his agent for that matter, receives over asking has more to do with the asking or list price and the general market conditions than anything else.
Marketing a property under the expected market price is a useful strategy just as it is for rugs or cars. You will always generate more interest if it is offered below market.
Since you are an experience transactor go ahead and sell your property. You will want to offer to "cooperate" with agents that bring and represent the other side. If you don't, you will cut off much of the market. I'm sure you realize that not many are like you, they don't have the experience or knowledge that you do. I know it would be nice for you to find some sucker to eschew their agent to work privately with you and "everyone would save money" but chances are very good that you would take some advantage and then your chances of getting sued go up significantly.
If there is an agent working with the other party your chances of getting sued are reduced and although the agent will not represent you we have a duty to be honest in business dealings with every party to the transaction.
In the larger picture negotiation and liability protection are much more valuable and expensive than the few thousand dollars FSBO’s save. If Walter had ever worked with a good agent he’d know the value.
I negotiated in one transaction a $55,000 reduction in purchase price on a $1.5 m home. I was protecting my client saw an opening and leveraged it way beyond the real value. That is what an agent can do.

I sent you an email with the link to make sure you got it and also included a link to the complete Northwestern study...a little misrepresenting was ahappenin IMO

Sorry I didn't realize you wanted the complete thing sooner, I be just a little to spacy sometimes

Hope you enjoy...

Dunes,

You are genius. I've been looking for that off and on for a year. Did you have pay anything, or was our buddy Brian/Miranda just, lets say, misrepresenting the facts? I'll pay you in Shiner Bock if you did. Heck, regardless I owe you a few that.

Rockinblu

http://www-siepr.stanford.edu/papers/pdf/06-41.pdf

April,

In all honesty, I've had a difficult time finding the actual Stanford study myself, but you are correct in that the information in it did pertain to the campus according to what limited info I did find. An agent found it once, and accused me of just being too cheap to buy it. He said it cost 10 bucks. I would have to think about it. I could almost buy three Shiners at the Continental Club for that. :)

Walter

The simple truth is people do successfully sell their own homes and the simple truth is they do so in a variety of ways. The simple truth is some people are not successful at selling their own homes.

The seller..YOU..does have options and the decisions are your responsibility, fail or succeed and to make those decisions wisely you do need to be completely honest with yourself about the time and committment you are willing to apply. Anything less than that suggests making an unwise decision...If you choose to go FSBO and advertise correctly, get the word out to Buyer Agents that you are paying a good commission to them, you definitely have a shot at selling in my opinion. (Assuming you figured the pricing ect. correctly)

The FSBO Data..mixed bag as you need to make yourself aware of how they arrived at their figures/% for this and that..Most are actually surveys and not studies or breakdowns based on actual homes sold & how

For example the Studies you mentioned were Surveys with (if you check) low % reply rates and they would also be effected by who was asked, where (local or national) ect...
Many of the numbers/percentages of this and that concerning FSBOs by Agents are as you mentioned based on the NAR numbers which mostly are taken from the 2008 NAR Home Buyer and Seller Survey..
http://www.realtor.org/press_room/news_releases/2008/11/home…

Some of the numbers ect. used in this forum are taken from even older Home Buyer & Seller surveys (You'll find them in the 2007, 2006 & 2005 surveys if you care to look)

Here's how NAR reached the numbers and conclusions they put in the 2008 NAR Home Buyer and Seller
Profile released to the press...
NAR mailed an eight-page questionnaire in August 2008 to a national sample of 133,000 home buyers and sellers who purchased their homes between July 2007 and June 2008, according to county records. It generated 10,053 usable responses; the adjusted response rate was 7.9 percent. All information is characteristic of the 12-month period ending in June 2008 with the exception of income data, which are for 2007. Because of rounding and omissions for space, percentage distributions for some findings may not add up to 100 percent.

You're the Seller so YOU decide the value of the info, same as you should for the other studies you mentioned
which in my opinion are just as flawed...

What I am saying is this, IMO it all boils down to making a Decision (an honest decision) of how well do YOU actually know your market area, how capable are YOU of Pricing right, how well can YOU market, How effective will YOU be in getting buyers agents to show your home? This is a huge Financial undertaking so it's about doing what's best...PERIOD. If that's you handling everything then Fine if it's not then get an Agent to help you.

Talk is worth nothing only action counts in something like this so while philosophically you may be correct make sure you know for a Fact you can do it as well as an Agent, if that's the conclusion you reach then get a goin and best of luck to you (I do mean that) but if you fail or it turns out you were not ready or capable (time/committment ect) then remember who made the Decision (No Complaints or blame) and move on.

The goal here is not to prove anything, it's to successfully sell your property, simple as that...

Best of luck, Dunes

Regarding your question pertaining to the Stanford Study, Consumer Reports Study and NAR Study, I do not know what the right answer is as I am sure all were based on real data. I will say that the Stanford Study focused on analyzing transactions on their campus. I am not sure that is a fair representation of the market as a whole. The area being watched is pretty sought after which I imagine would skew the results. I will have to get a copy of the Consumer Reports results.

Best of luck and continue to do your homework. Whichever option you choose, FSBO site or a brokerage who offers a menu of services, ask about errors and ommissions coverage and what protections will be provided to you.

Good Luck,
April Tavares, GRI, ASP
Realtor, DRE License #01742179

Thanks to the agents who took the time to reflect on the question. I asked the question because I am genuinely considering using FSBO. As Jed Lane surmised, I have been through real estate transactions before. Also, like a lot of professionals, my work is dealing in contracts. Contractual language doesn't scare me. No i'm not a realtor, i don't even play one on TV, but I know this particular market (selling and buying in the same area). I know the buying and selling process, know what to look for and look out for. So here's my quandry. I can pay FSBO $700 (approx) to be my internet clerk and my interface to MLS, where my listing will appear to local realtors or I can use a selling agent. I can pay a one time service fee or I can give up a % of the profit to a selling agent, precise amount TBD but more more than $700.

As to the debate over whether FSBO works as well as using a local realtor: the Natl Association of Realtors seems to be working from a different data set than what was used by Consumer Reports and by Stanford University in separate studies. Has anyone looked at the disparity between these two estimates to see which is closer to the truth? One set of studies is saying that FSBO sellers are getting on average more than their asking price while sales agents deliver on avg $5K less. but then the NAR is claiming just the opposite, that selling agents provide greater value in terms of sales price.

In any case FSBO isn't going away. It's another option for sellers. I remember using a car salesman at the dealership to buy a car. Except for the high end car market, that sale's job is now obsolete. People research, price and buy cars on the Internet now. Similarly, it seems that selling your own home is just a normal evolution of the real estate market. I don't mean to take anything away from the value of a knowledgeable hard working realtor. Most sellers are still going to use local realtors as their selling agents for some time. But there are easy to use, secure internet tools and so much secure access to detailed information, esp for the do-it-yourself.

Hi Walter

Well...asking a bunch of Realtors whether you should use a Realtor to sell your home, is like asking a bunch of attorneys if you should try to handle your own lawsuit!! What do you think we are going to say? :)

Here is how I see it. If you want to try and sell on your own - go ahead and try.
Worst case scenario, you can always list it.
I wouldn't keep trying on your own for long , though, as your home will become stale if you should decide to eventually list it. I would also make sure to price it aggressively to sell. Most FSBOS I see are not priced correctly, as they are often reaching for the stars. This can also be the case for listed properties, as well.

The FSBOs in my area generally are looking to "save" the entire commission, and don't often cooperate at all with agents.
In my opinion, if someone is willing to pay half (or more) of a usual commission to a buyer's broker, in the hope of saving that extra, small precentage, is it really worth it to go to all the trouble of trying to sell on your own? I don't know that it is worth it. So, why not just go ahead and list it, and leave the work and know how to the person who does this for a living? Just my opinion.

As far as you "knowing your market"....how many homes have you previewed (inside) that are currently listed or recently sold? Knowing your market is more than just looking up homes on the internet or gettign estimates from Zillow.
I have been in real estate for almost 25 years, and sometimes in this unpredictible market I wonder if I know my market !!!

You, Walter, may be the exception..You may really know what you are doing, and do a great job of successfully marketing your home.........it's an expensive lesson to learn you don't know, however.
The choice is up to you....good luck with whatever you decide.

Best wishes
Debbie Rose
Prudential NJ Properties

Walter,

If you represented yourself on a transaction and I was representing clients on the other side I will have an advantage because I deal with these issues everyday and can negotiate circles around many people. If on the other hand you have been through many real estate transactions and know, from experience, as much or almost as much as me then you are on an equal footing.

Remember it is my job to take advantage, as long as it is legal and ethical, of the other party in the transaction. And I'm good at my job.

Realize also that when negotiating it is typical to send in agents. The President doesn't negotaite for himself he sends in others. This gives you the opportunity to discuss stratagy, present certain positions and then have an opportunity to walk away to get decisions after calm discussion.

Walter
I don't know what you do for a living, but you obviously have a profession.

Do you think that based on the number of transactions you have had in real estate that you would hire me if I had your record?

Some food for thought: In a typical market, approximately 20-25% of properties sell within the first month and sell at the closest to sale price ratio. In my MLS that means that homes sell that sell within 30 days sell at 101.7% asking price. Homes that sell at 120 days on market sell at 96.5% of asking price.

What does this mean to you?
1. 75-80% of homes sold me Realtors are over-priced. Nationwide only 35% of Realtors are full time, so 65% are part-time. So if this is how they work with training, knowledge, experience, what does that say about people selling without any experience?
2. Only 20-25% of listings are price and marketed correctly. What are the odds that you know the market if only 20% of active Realtors get the pricing right?
3. 90% of buyers employ a buyer's agent. Do you think that the buyer's agents know the local market, trends, and values? Would you agree that they know the market better than you do?
4. How are you going to know how to price your home? What will happen if you use an MLS Entry Only broker, list your home in the MLS, and you get no offers?

I cannot tell you how many posts we see 'Help, my home is in the MLS for six months, and no offers. What can I do?"

That could be you asking that question. Asking professionals, Realtors, who do not know your home, your personal situation, your property, etc. And they want us to advise them with no knowledge? Sort f like asking an online doctor for a diagnosis.

My advice is to interview three Realtors. Compare their proposals. Try to sell it yourself. If you need to list (which happens 85% of the time according to a survey of sellers who tried to sell without professional representation), then you'll have your plan B all set.

Good luck.

Hi Walter,

Good luck with the sale of your property. I am a licensed realtor and I just have one other thought for you to consider. You mentioned that selling your home yourself would allow you to offer a higher % to the buyer's agent.

As a Realtor, I have committed and agreed to adhere to a code of ethics which states that I will always put my clients' fiduciary interests first. I primarily work with buyers and my first objective is to find them a home which meets their unique needs. A home offering a higher than typical commission payout would not put your home any higher on my list of homes to show a client. If your home doesn't meet my clients needs, I am not going to suggest or try to get them to compromise their wants so that I can get a larger commission. I am being hired by my client to streamline the process of searching for their home, assisting them and protecting their interest through the negotiation and contract process and any assistance I can provide after the sale.

Just another point for you to consider.

Best of Luck,
April Tavares, GRI, ASP
Realtor, DRE License #01742179

Walt,

You can market your home on Trulia with a Trulia Pro banner ad. Call 888-568-6487 for details. You can also probably create an ad in the blog section complete with a youtube video, photos, and links. The trick is to place a comment on it from time to time so it won't get buried. The lockbox issue is addressed in my blog. Check out owners.com ( http://www.owners.com/For-Sale-By-Owner/Sell-House.aspx?src=… ) regarding your possibility on getting on Realtor .com as well as other sites. Keep in mind a local agent might offer the same sites and charge a little more, but sometimes staying local is a good idea, providing the agent that does it isn't despised by the other Realtors. lol

It also goes without saying that statistical conclusions coming from an organization with an agenda and a checkered history should be taken with a grain of salt. In separate studies by Northwestern University and Stanford University, “by owner” sellers were found to be as effective as agents in maximizing the sales price of their homes. After commissions are factored into the equation, the studies reported, sellers who sell “by owner” actually save more money, and retain more equity, than sellers who sell through agents. The September 08 issue of Consumer Reports magazine also reported that FSBO sellers are more likely to get their asking price while agents deliver, on average, a sales price that is $5,000 less than the original asking price.

Again, please do not misinterpret this post as an encouragement to do a FSBO. It's just that I have a concern about posters sometimes being browbeaten into submission by members of this almost totally biased site. For some posters, stumbling onto this site has reminded me of someone opening a wrong door at a zoo. ROAR!!!

I am glad you are wise enough to ask the question before jumping in over your head. I totally believe that you should always use a REALTOR to sell your home. The liability is too high because of lack of knowledge of the paperwork involved, the process to closing, the timelines for inspections and proof of credit worthiness, etc. I have been a REALTOR for over seven years. A year ago my family was going to be relocated to another state. Since I am not licensed in the state I live in (I work and am licensed in a different state 25 miles south), I fully intended to find a selling agent that could handle everything for me. In the end we didn't move. The point is, using a REALTOR to market and handle the paperwork, inspections, closing, etc. is something you don't want to skimp on. Knowing the market to price your house right is difficult to pinpoint without the tools REALTORS have (like MLS computer, County Records, etc). Besides all the other things, it is hard to remain objectionable about your own house and keep the emotions out of it. It is also hard to be available 24 hours a day to answer calls and show your property. Buyers often will not be frank with you about what things are turn-offs about your property. REALTORS are well worth their commissions. Be sure to check out who you use and see what credentials they have, their track record and recommendations from past clients. USE A REALTOR.

You certainly do! If it's money you're talking about, statistically, its been proven buyers figure they can save a commission by working directly with a seller and that's just for starters. As far as the seller is concerned he, or she, will end up with all the paper work. Consider the fact athe seller hasn't had the exposure the seller needs to bring in more offers and the highest price. Realtors have prospects in hand and are looking for properties that will match up with their buyers. needs.To take it steps further, are sellers familiar with all the disclosures that are necessary and required by law to protect themselves, not only state required but local requirements? Do sellers have access to reputable vendors that are dependable and competitively priced? Do sellers have Errors and Omission Insurance? Do sellers have the ability to advertise where most effective? Have they the ability to preapprove buyers? Do they have negotiating skills? Are they familiar with forms on line and on line signatures? Are they bound by a Code of Ethics? And this is just for starters! In today's world I can't imagine a seller taking on the giantic task of trying to sell a property. There is too much at stake, and the best part is after working with a reputable Realtor you may end up making a friend for life.

Hi Walter,

The most important thing is being able to market your property especially on the internet (ie: trulia, Realtor.com and many other sites, 85% of buyers find properties they purchase 1st through the internet) and through the local MLS. If you have any questions about our current market in Truckee, don't hesitate to call me anytime. My cell number is (530) 448-9830.

Good Luck,

Greg Poulsen
Dickson Realty
11500 Donner Pass Road
Truckee, CA 96161
CA DRE#: 01426653
Office #: (530) 550-5026
Fax #: (866) 528-7861
Cell #: (530) 448-9830
E- Mail: Greg@TahoeHomeHunter.com
Web Site: http://www.TahoeHomeHunter.com

Walter:

The beauty of this country is the permission to do just about anything you want. The problem bred by that is the mindset that you can do anything WELL. Yes you can list your own home. If you can get on the local MLS, have at it.

Here are a few problems you might want to consider:

(1) Many buyers don’t want to deal with home owners selling their own homes. They believe they are not objective and/or qualified to do an effective job.

(2) Many buyer’s agents don’t want to cooperate with “for-sale-by-owner” properties because, legally, it puts them into a dual-agency relationship with the home owner and their buyers. In addition, because you more than likely will not have all the applicable forms, disclosures, or even know all the intricacies of the local real estate related laws (particularly related to disclosure), the buyer’s agent will typically have to provide much of this for you. This adds increased liability to the buyer’s agent and increases the work they do.

(3) You will not have access to much of the internet based advertising that is so critical in today’s market. Virtual Tours, custom property websites, Realtor.com featured listings, Trulia Pro Listings … the list is endless.

(4) Since you will more than likely not have a digital lockbox from the local MLS, you will need to use a less secure lock box with a combination code for prospective buyers and their agents to access your home while you are not there. This will not provide the additional security you really should have. And if you are thinking of showing by “Appointment Only” or only during specific times, you will be seriously sabotaging the marketability of your home. You need to be able to provide access to buyers when it is convenient for THEM, not you. A lock box is the only effective means.

(5) Most homeowners really have no clue about how to effectively market their homes. Seriously. You might do this once every few years. Seasoned full-time pros do this … every day. We know what works and what doesn’t.

(6) The National Association of Realtors website has statistics that affirm that for-sale-by-owner homes typically sell for quite a bit less than those being sold by full service Realtors. This has been a consistently demonstrated fact throughout the last number of years and different types of markets. You may not like the data, but it’s real.

Sure you can do it yourself. Question is, why would you want to? I’m not just speaking as a Realtor, I’m speaking as someone who managed to sell my own home as a FISBO long before I became a Realtor. I know both sides of the fence – and, knowing what I know NOW - there are MANY reasons you want to go with a Realtor.

Hi Walt,

I'm normally not comfortable recommending one way or the other. Remember this is a Realtor dominated site, so it will be hard to get an unbiased opinion. BTW, nice piece of FUD by Bonnie. Below are two links. The first is to a blog on doing a FSBO, and the second is on one choosing an agent. Good luck on whatever you decide.

http://www.trulia.com/blog/rockinblu/2008/08/thinking_about_…

http://www.trulia.com/blog/rockinblu/2008/12/i_ve_got_my_fin…

Knowing your market can the first step in getting your home listed for sale. The intricacies of listing a home for sale - excellent marketing and exposure are also important factors in selling your home. Not being a member of any MLS limits your potential for this exposure.

However, have you considered the potential ramifications of not having an agent? How do you know those people calling to view your home are legitimate buyers? How do you verify that people who make an offer on your home actually can afford your home? How to you work out contractual situations? How do you negotiate with a buyer if you recieve a very low offer? Do you have an attorney that can advise you during the process and if so, is this attorney a real estate savvy attorney? How can you be certain you are fully protected from potential lawsuits should you not understand the disclosure process? Realtors spend hours in continuing education on how to protect both buyers and sellers each year - laws change continuously and if you are not fully educated and informed a simple mistake could cost you thousands of dollars!