In the real estate world, when a homeowner is selling a home themselves, we refer to it as FSBO. If you are a homeowner and planning to sell your home on your own, you might want to consider a recent survey conducted by the National Association of Realtors.
A couple years back a survey revealed, the typical for sale by owner home sold for $46,000 less than homes sold with Realtor® assistance. Although the survey is slightly dated and includes the entire country, the percentages are valid! At the time the survey revealed, on average, FSBO homes sold for $184,000. During the same time period, homes sold by a Realtor® at a price of $230,000. That’s a pretty good chunk of change but well worth considering if planning to sell your own home here in greater Los Angeles areas.
Today we won’t be covering arguments for or against FSBO’s. At iRealty we can be more helpful by sharing some of the challenges homeowners are faced when selling their homes in the Los Angeles area, and all of Southern California.
Things Homeowners Should Consider Before Moving Forward With a FSBO
- Make sure you really have the time to devote to all aspects of the sale. Selling a home can be a daunting task and if it’s a FSBO, it’s even more time consuming.
- Setting the Right Price! This is critical and the homeowner must depersonalize their feelings and get the price right! Getting the price right at the start, can and will make or break the sale. When homes first come on the market they are interesting and attract attention. They are immediately scrutinized for market value, and if it’s discovered the price is too far above the mark, it will be avoided. Even if lowering the price later, the home has lost it’s new listing appeal and will be ignored. It will never be a new listing again, unless it’s taken off the market and brought back at a later date.
- If you don’t have a good understanding or a background in real estate, you’ll need to research the required paperwork and understand how to perform it. Even if you do have some real estate market experience, here in California there are always changes and it can be difficult to keep up.
- Preparing the home for sale. It’s important homeowners know of which home improvements pay off, and which don’t. Be sure to research your market before performing any home improvements. Certainly, you want to present your home in the best light possible, but be very careful not to throw your money away in the process.
- Helping Your Buyer Obtain Financing. Even if it’s a FSBO home sale, there are ways homeowners can help prospective home buyers obtain loan pre-approval and financing.
- Consider how to attract qualified buyers to view your home. Homeowner’s must plan on advertising, but this won’t help in making sure buyers are actually qualified. Put a solid plan in place and work out how to keep out the window shoppers.
- Marketing Plan and Execution. Perhaps, one of the toughest hurdles is how homeowners can attract buyers without the help of the local Multiple Listing Service.There are ways to have the home included, but it can be costly, and that’s exactly what a FSBO is trying to avoid.
- Time Frame! If there’s a selling deadline, homeowners must build their sales plan to to fit their schedule.
In summary, homeowners should plan to take the time needed obtain the knowledge before moving forward with their FSBO. Then, they’ll need to make themselves available and have the time needed to devote to the process, from start to finish. There will be expenses involved and FSBO’s attract plenty of annoying, unneeded attention. It’s never easy, so be prepared for a tough road ahead.