Sandi, Both Buyer and Seller in 97202

What does it mean when a FSBO lists one price..?

Asked by Sandi, 97202 Wed Sep 12, 2007

but then says he will raise the price once it is listed with an agent?

Aren't homes listed with real estate agents supposed to be listed at market value? If this is the case, then is a FSBO claiming they are actually selling below market value? Or do sellers of homes listed with agents get less than market value because of commissions?

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Answers

40
Jim Walker, Agent, Carmichael, CA
Thu Sep 13, 2007
I disagree with Jeannette about the FSBO sales tactic being shady. The seller is merely trying to induce a "fear of loss" in the prospect. It is a common tactic that sellers engage in all sorts of products. It is a "hard" sell tactic. Hard sell is not neccessarily shady, it is merely aggressive if there is actual truth to the future price increase that is threatened.

In this case, there is probably the truth in the threat. The FSBO wants to net the same wether it is listed or not.

I have been a prospect myself many a time when the car salesman or advertising space salesman explained that I could buy today at Price A but that if I waited to act, the price later would be A + B"

On the issue of whether FSBO's sell for less than listed properties. Statistically, they do, by as much as 17%. However those statistics include sellers who have sold "FSBO" to relatives, to employees, to neighbors and to friends. The statisics that support a below market price for FSBO's also include the victims of predatory investors who approach homeowners with clever schemes designed to enrich the "investor"

Most "FSBO's" who are actively marketing their homes price there homes at or above market price to begin with, then bring the prices down until they finally get a sale, or give up and turn the listing over to an agent. The particular FSBO you are dealing with could be at, below or above market price right now. If your Mr. FSBO does eventually list with a Realtor, he will have a hard time convincing a smart Realtor to list it 5 or 6% above market value for sake of covering the commission.
4 votes
Bryan, Home Seller, Clifton, NJ
Thu Oct 11, 2007
A smart FSBO seller will first do the research to determine what the market value is and then subtract a "commision allowance" so they can 1) offer it below what it would be thru a realtor to save the buyer $$ and, 2) still net more $$ than they would if it was sold by a realtor. Good FSBO practice is to assume that the sale will be via a buyers agent who will have to be compensated.
3 votes
Bob, , 02038
Thu Oct 11, 2007
It means the seller has a "bottom line" in mind about what he's willing to walk away from the closing table with. I think since most properties on the market are listed by agents the majority of them are overpriced
due to stubborn owners trying to get their bottom line AND pay the realtor at the same time. So if he lists with the realtor he'll ask them to raise the price so he still gets his bottom line with the assumption that the wider reach a realtor provides will eventually bring someone in that will buy at that higher price.

I do agree that a house listed FSBO at 300,000 will not show as well as the same house listed by agent at 300,000. The realtors have far more reach.

But if you are a "savy" owner (and there are some of us out there) you can easily determine within a few thousand $$ the price range what the market value of your house is unless it's a really unique property. For example a 6% commission on a 300K house is 18K. So you can to sell FSBO at 300K and compete with a bunch of realtors (bad), or drop the price up to 18K and still walk away from the closing table with the same or more money in your pocket. Now your house is priced lower than the price all of the realtor-listed homes (remember stubborn owners getting bottom line and paying commissions).

The point of the story: A FSBO can (if they are smart) sell at a lower price faster because he's competing against a bunch of Reatlor-listed properties where owners have their bottom line and if the Realtor wants the listing they must raise the price to cover that and their commission. So I think many Realtor listed properties can be listed too high, and a "do it yourself" FSBO owner can position themselves correctly to take advantage of that situation and price their house lower to move quicker.
3 votes
Louise, Both Buyer And Seller, Colorado
Thu Oct 11, 2007
FSBO is the ONLY way to go in today's market. I bought from the Owner and just sold witha real estate agent. The only protection I had was a book for a contract that protected the realtor. Not me. I lost money and so did the buyer.

ALWAYS BUY FSBO
3 votes
Chris Tesch, Agent, College Station, TX
Thu Oct 11, 2007
Sandi, Very good question, and the answer, as in most cases is a qualifed, it depends. I've seen FSBO's sell and both parties come out of it quite well. I've also seen the exact opposite. Last year I was working with a buyer and they wanted to see a FSBO. The FSBO wasn't interested in working with an agent, but my buyer was willing to pay my commissions. My commissions ended up being $4,300. However, with the market information I was able to come up with we got the price reduced by almost $17,000. The property probably would have appraised for either number, but my buyer was quite happy with my work, they felt like I more than earned my commission. "Market price" can be a variable thing. It depends on who is in the market that day. In general, in my opinion, unrepresented buyers often end up paying too much. Statistics do show that unrepresented buyers make less, but that is tempered with the situations where they are selling to relatives or the seller is just unaware of market value.

I believe that buyers are much more likely to have a more positive outcome when working with an agent. They will see more properties and have a much better idea of what properties should sell for. They will be able to make an educated decsision about home inspections and negotiating for repairs as well.

Good luck with your situation!
3 votes
Deborah Madey, Agent, Brick, NJ
Thu Oct 11, 2007
After talking to hundreds and hundreds of buyers and sellers over a decade plus, I can tell you that sellers typically think they are selling too low, and buyers typically think they are paying too much. This pattern rings true in both seller and buyer markets. It simply results from the perspective of the shoes one is stanidng in at the moment.

I have also walked through a number of transactions that started friendly, have at times gotten tense, and ultimately closed with happy buyers and sellers.

Based on the laws of probability, it is rare that a buyer and seller can achieve a transaction at exactly market value, less commission and both completely believe they came out ahead. It is an emotional transaction and logic does not always prevail. Realtors spend much of their time delivering accurate messages to clients that the clients don't always want to hear. i.e. a seller's price is perceived too high by mulitple sellers and Realtors.

I often have to tell my clients what they don't want to hear, while concurrently assuring them that my advice is meant to assist them and that I am on their side.

So, your goal and desire may be admirable, but in my experience of dealing with hundreds of buyers and sellers, I can say it is easier to achieve in theory than reality.
3 votes
Dezzy, , 94103
Thu Oct 11, 2007
Full disclosure: I'm currently working with an agent, but I think going FSBO can work.

A friend of mine just bought his house from a couple that didn't use an agent. In his situation, neither party worked with an agent and both walked away from the situation feeling like they did better than they would have done otherwise.

I know this is anecdotal versus hard data, but he looked at the comps and came up with a "market price". Him and the seller then negotiated to determine the appropriate market price. Then both of them discounted what would've been otherwise paid to an agent and it went back into their pockets. Sounds pretty good to me.

I'm sure there are horror stories to counter this success story, and I'm not saying this is for everyone...but I just don't think it's always necessary to have an agent representing you.
3 votes
Yolanda Tann…, , 92584, 92585, 92562, 92563, 92564, 92596, 92592
Wed Sep 12, 2007
Sandi,
this is not uncommon for FSBO's. Usually they want to Net a certain amount and in order to maintain this "projected" Net they will raise the price of the home, to compensate for the Realtor fees/commissions and costs.

As far as "below market value" it is a claim that many make. But remember, theoretically, the lower a property is under market value the shorter time it will be on market and the more above market value the property is the longer it will be on market.

Also, market value is not what the owner thinks their property is worth, nor is it what the highest price a home on the same block sold for two years ago. Market values are dictated by Buyer's and is simply what Buyer's are willing to pay for a property in "today's" market.
Web Reference:  http://www.951homes4sale.com
3 votes
Sandy & Kirs…, , Winston-Salem, Triad Area
Thu Oct 11, 2007
Thanks for your question. It is often understood that the Seller is trying to earn the commission instead of paying the agent if the home is at market value already. In the event the Seller wishes to raise the price once he/she lists with an agent, makes me wonder whether or not he/she has an actual market analysis or an appraisal to determine value. The property must appraise, once sold, so raising the price just to cover commission could be precarious. Here's hoping that helps.
2 votes
Javier Varon, Agent, Carlsbad, CA
Thu Oct 11, 2007
Don't worry about it. FSBOs generally have no real concept on price. Just offer what it's worth to you. If you don't HAVE to have the house, just wait until it's listed and then offer the same price you offered before. It'll sell for what it's worth not for what the FSBO or Agent think it's worth.
2 votes
RN, , Miami, FL
Thu Oct 11, 2007
First of all, the stats are indisputable: the average FSBO sale is 16-18% less than the average brokered sale, which you have probably already read in my colleagues' answers.
Real Estate agents should be listing a home at a competitive market value price, one that will attract attention and sell. Those agents who take a listing with the scenario you described (and we've all heard it before) are simply looking to have the seller's yard as their personal billboard. They know the house is overpriced and won't sell; they are just looking for buyer prospects.
Buyers who target FSBOs know the seller isn't paying a commission and will more often try to lowball the figure.
To worsen the problem for FSBOS, this is the WRONG market to be trying to sell a house without some serious marketing and networking energy behind the effort. You are in a sea of competitors, and you are an amateur with about 90% or more of your competition as professional brokers. That is why about 80% of all FSBOs end up listing with a broker, but not before they have lost valuable time on the market, hence decreasing their asking price.
Want another reason not to go FSBO? Mortgage fraud rings are targeting FSBOs more than any other group, because they know a Realtor isn't involved and won't stop the process.
Furthermore, with the lending industry's tightening of the approval process, your chances of coming across a truly qualified buyer are less-and how will you get them qualified, unless you are working side by side with someone in the lending business?
Whatever you do, my friend...LIST with a reputable, energetic, POSITIVE Realtor who will guide you through an ever-deepening jungle of selling obstacles.
2 votes
ian cockburn, Agent, New Orleans, LA
Thu Sep 13, 2007
Remember, at the end of the day, the house will most probably sell for what the market drives the price to...it may get a higher price with the right marketing, but yes, the FSBO if they know what the selling prices are may be selling at a discount
Web Reference:  http://www.iansellsnola.com
2 votes
Gloria Matth…, Agent, Vancouver, WA
Thu Sep 13, 2007
Smart Sellers use realtors, and Smart FSBO sellers are willing to pay "a courtesy to broker". Meaning they will pay YOUR realtor for their guidance and professional services, from contract to close.

If the fsbo is priced too high, your agent can advise you of the true current market value.

Real estate transactions continue to become more complex, disclosures, inspections, saleable title, etc.
I recently ran into a MLS listing that was with a limited agency firm, and when I checked ownership. The person offering the home for sale, was not even the owner of record.

If you like this house, Hire proper representation, whether the seller pays it, (which he will if he wants it sold), or pay it yourself and ask for "closing costs".

good luck
2 votes
Deborah Madey, Agent, Brick, NJ
Wed Sep 12, 2007
Sellers determine the price whether it is listed w/ a Realtor or offered FSBO. Realtors advise sellers about pricing based upon the comps in the neighborhood. It is common for seller to want to place a higher listing price on a property than a Realtor recommends. It is common for a seller to think they can 'start higher and come down later.' Unfortunately, overpricing leads to a lower sales price, not a higher one.

When a seller wants to price higher than the Realtor recommends, the Realtor needs to decide if he or she will walk away and not list the property, or work with the seller and advise the seller to be prepared to make price adjustments if the market does not produce a buyer. Sometimes, a Realtor will simply walk away and tell the property owner that he/she cannot represent the seller.

So, when you see a price on a property whether it is FSBO or listed with a Realtor, that price tag came fromt he seller. The seller may have heeded professional advice in structuring the offer, or may have ignored it. In both FSBO offerings and listed offerings, evaluate the comps and determine the value according to that data. Structure your offers based on the value to you as supported by the facts of recently sold properties, inventory, trends, and competing active properties.
2 votes
Carrie Crowe…, Agent, Southaven, MS
Wed Sep 12, 2007
FSBO's sell their own homes because they feel like they can save money by cutting out the real estate agents commissions. If they have to pay a commission of any type they will often increase the home price. They feel like they can offer the home to the consumer at a lower price for the consumer, getting a quicker sale and netting more money. The truth is most FSBO's would make more money if they used a Realtor. Not all, but statistics show that most would. Interesting concept. Not a bad one if it saves money for the buyer!
2 votes
Mr.P, , Arizona
Wed Sep 12, 2007
Hey Sandi
The FSBO is trying to tell you that you can save money by not using a Realtor
If you do not use a Realtor he will sell it for let say $300,000
However if you do use a Realtor or he has to list with a Realtor he will offer the house at $315,000
He is telling you that he has to pay 5% the Realtor.

Who says it`s worth $300,000 to begin?
Be careful
Good Luck
2 votes
Julio Ferrei…, , Dallas, TX
Thu Oct 11, 2007
This seller seems to be either very ignorant or thinks he's too savy. As an investor I always put my houses on the market with Realtors because it multiplies greatly my exposure and chances to sell. I've got a deal with my Realtor that if I find a buyer myself, I don't have to pay a comission, which makes him/her work harder to beat me! If he's selling under market value, will it be only 6%? Be weary about FSBOS w/ that mentality...
1 vote
J R, , New York, NY
Thu Oct 11, 2007
Deborah wrote:
After talking to hundreds and hundreds of buyers and sellers over a decade plus, I can tell you that sellers typically think they are selling too low, and buyers typically think they are paying too much.
~~~~~~~~~~~~~~
Amen, Deborah. And both think the other is nickel and diming them to death.
See that Louise? You were on both ends of the equation and fit both descriptions. :)
1 vote
J R, , New York, NY
Thu Oct 11, 2007
Louise wrote:
FSBO is the ONLY way to go in today's market. I bought from the Owner and just sold witha real estate agent. The only protection I had was a book for a contract that protected the realtor. Not me. I lost money and so did the buyer.
~~~~~~~~~~~~~~~~~~
Can you elaborate, or will you be another drive-by poster?
1 vote
Chris Shouse, Agent, California City, CA
Thu Oct 11, 2007
From some of the FSBO's I have dealt with or talked with it seems 90% have had a bad experience with a real estate agent. He may raise his price if he lists with an agent but only if the market will support whatever price. Bottom line the house still has to appraise and unless you are paying cash an appraisal will be done. They will look at the last three months comps. (a little more if there are none) but the market is changing so fast comps change weekly.
1 vote
Robert L. Sc…, , 44077
Thu Oct 11, 2007
No, when Realtors price a home they compare it with the price of others that are currently on the market and similar homes in the area that have recently sold. Their commission is not figured into the equation. When a person prices his own home forsale he usually prices it in accordance with what others in the neighborhood have sold for, just as a Realtor does.
1 vote
David & Lisa…, Agent, Millersville, MD
Thu Oct 11, 2007
Homes listed with Realtors may or may not be at market "value". In many areas, prices are dropping so determining market value is tricky for even experienced agents. The seller ultimately determines the sales price as it is their home; a Realtor is merely the "agent" of the seller, assisting them in selling their house. Many times FSBOs will say that their price is "less than market value" and you're getting a deal because they are cutting out agents, but this is not always the case. Many sellers actually net more money when they list with an agent because they are are getting exposure and advertising that they can't afford, the Realtor pays for it, brings in pre-qualified buyers, and the house sells quicker and for more money. Most FSBOs overprice their houses and then tack on the agent commission if they decide to list, but a good Realtor will educate them on market price and encourage them to be realistic if they want their house to sell. Beware when you purchase without an agent. I spoke with an investor who was selling his rental property when he asked me about values in the neighborhood. I told him with his house remodeled, he might be able to get $300K if he is lucky. He said he should get $350K because of the money he put into it. We all know that what you put into a house has no bearing on the market value; market value is simply what a ready, willing, and able buyer will pay. He ended up selling FSBO to a young couple who were not represented and they paid $309K for this 30 year old interior unit townhome which at MAX should have sold for $300K - several are listed below that now and are not selling. Was that really market value? Yes, because they did pay it. Should they have? No, they paid too much. Sometimes a buyer might think they're getting a good deal by cutting out agents but if you don't know the values well, you may overpay. The recommendation of having your own buyers agent is a good one and most sellers, even FSBOs, will pay your buyers agent - have your agent contact them first and let them know that you are interested, but you wish to be represented and have your buyers agent negotiate with them to pay your buyers agent commission so it doesn't come out of your pocket. GOOD LUCK!
Web Reference:  http://www.webberteam.com
1 vote
J Lo, Home Buyer, California Glory, Brentwood, CA
Fri Sep 14, 2007
Sorry Jim:
Shady was the best term I could come up with because I really like things on the up and up. Inducing anything through a hard sell tactic can come back to bite if you say one thing and do another. The reality is that credibility is crucial.

I could write a whole dissertation on why I don't believe in this tactic - but it just muddies the water. I do respect your point of view and will take it under consideration - but for now I stand firm - I find it shady to the umpteenth degree.
1 vote
J Lo, Home Buyer, California Glory, Brentwood, CA
Thu Sep 13, 2007
Hi Sandi:
I am making a few assumptions here that you spoke directly to a FSBO seller who is giving you his/her schpiel about the deal you are getting.....

I like going out on a limb - so I am going to say that it's a pretty shady marketing ploy. Not to mention the fact that there is probably very little "fact" in the numbers.

If you are genuinely interested in this property - and you want to make an offer - get your agent to do the work and see what the whole deal is really worth (aka market value).

And to answer your direct question: Sellers listed with agents are able to obtain the highest "possible" selling price. In our industry we call it "what the market will bear". The market is the buyer - and the buyer determines the value by the offers they make & then ultimately what the seller accepts.

And YES: Homes listed with agents are generally "market value" because the numbers are derived from what the comparable homes are selling for & used in helping the seller determine his/her selling price.

The problem with some FSBO's is that they are trying to utilize numbers that historically worked in the past. Right now the numbers and rules are changing so rapidly - which only magnifies the need for a professional to be monitoring you product.

Change and adaptability are what help you to keep up with the market. Not off the cuff statements by someone trying to make a case for their pricing.
1 vote
Keith Sorem, Agent, Glendale, CA
Wed Sep 12, 2007
Sandi
Anyone can list a home at any price they wish.
When an owner sells without representation they estimate their list price, then inform prospective buyers that they are taking into account the broker's commission.
Unfortunately a couple of things can happen:
1. Buyers usually still want to buy for less (they subtract the commission anyway).
2. Because of the limited pool of buyers (most buyers, over 90%, have a Realtor represent them in the purdchase), in most cases the property will not receive the proper exposure and may sell for under market price.
3. Conversely, I have seen buyers pay too much for properties. It's a free country. You can do as you wish.

Caveat Emptor! Let the buyer beware!
1 vote
The Hagley G…, Agent, Pleasanton, CA
Wed Sep 12, 2007
This sounds ike an exceptionally bad marketing ploy. (A good Realtor will not take a listing over market value, by the way.)

Studies show that FSBOs generally sell 11% under market value. If thiws seller used a Realtor, he'd still be ahead of the game. Afterall, you get what you pay for!
Web Reference:  http://www.cindihagley.com
1 vote
Carolyn Gala…, Agent, Chatham, NJ
Wed Sep 12, 2007
The seller wants to add the agents commission in to his current price. I know, it is confusing. If this helps, most FSBOS ask too much for their house, so the price they are showing it at is not a " bargain price.".
1 vote
Salt Lake Ag…, , Salt Lake City, UT
Mon Oct 22, 2007
There is no such thing as below market value. Market value is whatever a buyer and seller agree to. However it is possible that the home is belwo recent solds. If that is the case then it may mean the market is going backwards.

If they are over priced they won't sell. The market won't allow it. So if the seller thinks they can add a commission on top of value they are mistaken.

Sounds like a seller using a tactic for a sale.
0 votes
Jim Mccallum…, , Pueblo West, CO
Mon Oct 22, 2007
This might be good for the seller, if he can generate any buyers from his sign. But, who is there to inform the buyer of his rights and opportunities to get out of the contract if things go south? I recommend that, if you do like a house that is a FSBO, don't contact the owner. Contact a reputable Realtor and ask him to contact the seller to get a commission agreement to be paid by the seller to your agent, just for this showing, and have him arrange a showing for you. Sign a one-day agreement with the agent for this showing. This way you will have a no cost representative in your dealings with the seller. Many times the seller will agree to this, because now he only has to pay partial commission, and is also somewhat protected, in that someone is keeping up on the dates for performance of both parties in the process.
0 votes
Mona Beuthel, Agent, Greenwood Village, CO
Thu Oct 18, 2007
Sandi,

Lets think for moment about why a home owner would want to sell their home themselves. They want the Realtors commission in their pocket and want control over the asking price. You are not the winner here. They don't want a Real Estate Professional trying to market their home for less than what 'THEY' feel their home is worth.
Traditionally there is no advantage ,to a buyer, to purchase a FSBO property. Statistically you pay more for the property and are subject to the Sellers ego inflated purchase price.The Seller is not subject to Real Estate Laws as agent is and can set their own rules and standards for you.
My recommendation to you is, to work with an agent and to be FULLY represented, and let your agent negotiate with the Seller. Then the 'Buyer Beware' rule is diminished in 'Your' best interests.

Be safe, Be happy,

Mona
0 votes
Amber Carson…, Agent, Clearwater Beach, FL
Mon Oct 15, 2007
There are two ways to think about this question.

One, many times a seller doesn't really understand the value of his home and may underprice it, or conversely he may overprice it because he is proud of the home and work he has put into it.

Two, working with a Realtor has the advantage for the buyer that defects will be disclosed before you purchase and all of the legalities will be in order such as clear title and transfer of any warranties available and a solid contract that keeps everything honest, no last minute surprises.

Realtors often get more for a home seller simply by offering greater exposure to the market place as well as pricing properly. Most home owners have enough equity in their homes to work with a Realtor without increasing the sale price to the buyer.

As a buyer you have the ultimate power of negotiation in this market. If you are interested in a home make an offer, now is a great time to buy!

Don't forget a buyer doesn't pay an agent to represent them in purchasing a home, the commission is paid from the sellers proceeds. Get an agent to work with and you'll see more and spend less time and gas looking.
Web Reference:  http://www.callamber.com
0 votes
Darin J. Dug…, , Saint Petersburg, FL
Sun Oct 14, 2007
Sandi,
This is a good question. You can see people or signs market their home stating they are below market value or below appraised value and think that will make the home sell. They will also disclose that if the home is sold using a realtor the price of the home will be increased. This increased price will cover the costs of a professional commissions. As a seller this can backfire and would encourage you to market your home at the best value that would include professional fees, just like when you go to the doctor.

There is a bigger questions that you have asked which is market value. Market value is determined by what a buyer will pay for something and what is the best price a seller can get for what they are selling. This is the exact same concept that is used with the stock market. At this time we are in a buyers market and buyers are determining much of the prices. This is also cyclical as it will swing back to a sellers market in the future... and again back to a buyers market over time.

Many real estate professionals will not take on the responsibility of listing a home if they believe it is above market value or over priced. There are some agents that will take on a listing based on what the homeowner dictates regardless of their knowledge of the area. In these cases this increases the inventory of homes in the area as well as the amount of time a home will remain for sale. In our experience homes will sell if priced right and marketed correctly.

When buying and selling a home it is an emotional decision and recommend you reach out to a professional that can and will help. They can help provide guidance as to a price range that your home may sell. And when buying they can provide you assistance with what the homes in the area of your search or being offered at, ameneties and sold. If you decide to do it on your own know your market, know your competition and be realistic.

Know before you buy or sell... and you will be able to get the best value for your home on either side of the closing table.

Best of fortune with your experiences. If you have any questions please let me know.
Darin
Web Reference:  http://www.DTeamHomes.com
0 votes
Don Bush Team, , Columbus, OH
Fri Oct 12, 2007
Most sell at market value. FSBOs don't believe it, so they sit a long ime, then reach for a Realtor in desperation. Buyers save money b7y using a Realtor.
0 votes
Bob J Bowman, , 18322
Thu Oct 11, 2007
Realtors give the seller a range of market value that reflects the current what the market will bare this includes the commission because it's based on homes listed with the MLS that all include the commission. FSBOS will likely take that number and add 6% that puts them over priced. Buyers of FSBOS will tipically bid lower then take off 6% I Belive your always better off with professional third party to negotiate. Find more about the reasons to use a Realtor at http://www.realtyworldrealtor.com
0 votes
Ulises Romo, , Phoenix, AZ
Thu Oct 11, 2007
I do not believe that homes sold by agents receive or are marketed for less. The perception is that owners believe they know what their home is worth since they know what they paid for it. However time has changed along with the market and homes can actually be depreciating not appreciating in value.

In addition, I believe their was a statistic I read where on average you make more money by using an agent vs. selling on your own. I believe the number was 16% higher than FSBO's. For Example, a $250,000 home will get you about $40,000 dollars more than if someone sells on their own. Is that worth using a REALTOR®?

In comparison, on the same price home your commission pay out would be $15,000. And this gets split two ways between a buyers agent and the listing agent.

Finally, an agent has access to more homes that are for sale. With an inventory that has an abundance of homes, your likely to find a good deal.

People think that buying a foreclosure home or a FSBO home or what ever the case may be is a great deal, however you do not have the protection and choices available from using a REALTOR®. My opinion is to talk to a few agents to see what they think, and how they may be able to help you.
0 votes
barbara mcma…, Agent, Everett, WA
Thu Oct 11, 2007
The answer depends on the seller. NAR stats indicate that a good agent can get about 16% more for a home than a FSBO. In my experience, a FSBO will list at market price (the price of comparable properties including the listing/selling commission) in an attempt to "save money". Often, a seller will pay 3% sales commission to an agent that brings in a buyer. To me, this is a dangerous business. Depending on "agency" in the state, that may mean that the seller is left unrepresented by an agent. The market value of a home is what a ready, willing and able buyer will pay in an arm's length transaction.
0 votes
Ron and Kat,…, , 60002,60046,60081,60030,60073,60020,60041,60031
Thu Oct 11, 2007
The recent entries here sound like they come from the discount FSBO companies themselves. We have spoken to soooooooo many homeowners in the last year that have fallen prey to those companies (ForSaleByOwner, HelpUSell, BuyOwner and the like). Those companies (many of them) charge $5000 upfront and what happens to those homeowners when their house does not sell? Yes, they are out that money and then have to list with a realtor anyway. Not only does the seller lose the $5000, they have to pay their monthly mortgage payment, interest on the loan, property taxes, and insurance for every month their house sits on the market. That is quite a chunk of change.....month after month, after month. This IS the worse market we have seen in 25 years. Why would a seller take the chance on a discount broker (you get what you pay for) when sellers don't know where to market, how to market, how to stage their home, how to price their home, and so much more. Realtors perform over 200 duties for their clients and it's what they do for a living. What homeowner has the time to perform all those duties and still earn a living?. Selling homes IS what realtors do for a living. They are EXPERTS in the field. There are bad apples in every profession. (Take a look around your own office). Most realtors are hard working, honest people who have their clients' best interests at heart. If they don't, they just don't get paid. A Realtor also has a Code of Ethics that they must live by in order to keep their license. It is very true that a realtor can net the homeowner mosts times 18% over the fly by night discount broker. FSBOs are trying to save themselves 5-6% by not using a realtor. Let's do the math......18% minus 5%? Still nets the homeowner 13% more than some online discounter. The answer is simple...........hands down........don't fall for the glamour! We can't stress this enough. The only one who wins by selling FSBO is the discount broker when they walk away with your $5000 dollars.
0 votes
FT, , Parsippany, NJ
Thu Oct 11, 2007
Don't Try This at Home - from NAR.
Sellers who use a real estate professional make 16 percent more on the sale of their home than do sellers who go it alone. Unrepresented sellers often do not understand the complexity, range and timing of tasks they will have to perform if they don’t use a professional.

REALTORS® are real estate professionals who are experts in marketing and negotiation. REALTORS® can help a seller set a realistic price and ensure the proper paperwork and various disclosures and inspections are handled correctly. REALTORS® know best how to prepare a home and maximize value, provide broader exposure to the market and are more likely to generate multiple bids than a seller on their own.

In addition, REALTORS® are experts in attracting qualified buyers. A professional can show a home more objectively than can a seller who may be emotionally attached to the home, and who might become unnerved by prospective buyers’ critical comments. The real estate pro also checks the financial capability and bona fides of buyers before allowing them onto a seller’s property.

Use these materials to convince would-be for-sale-by-owners (FSBOs) of the value of hiring a REALTOR®.
0 votes
Thomas Ierac…, , 31632
Thu Oct 11, 2007
Very good question. How do you know what the market price may be for a home? Who will do the research? I am a Broker for a large office and when an agen calls me to ask a question about a particular transaction the first question I will ask the Agent is "Who do you represent? The Buyer or Seller? " A Buyers Agent can answer all of the above questions for a Buyer. Typically we all know why a Seller is selling For Sale By Owner ---- to save the commission, because the Seller usually pays the Real Estate Commission. The Market Price for a Property is the Market Price and the commission has no bearing on the Market Price.
Using a Realtor provides many services and protection for either side of a transaction.
0 votes
Pam Winterba…, Agent, Danville, VA
Wed Sep 12, 2007
The FSBO is trying to communicate a savings to the buyer by reducing the price. If they list with a Realtor they want more. Ultimately the seller sets the price irrespective of market value. One of the ideas of FSBO is the save money for both parties.
0 votes
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