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FSBO is an acronym for "For Sale By Owner", which means selling your real estate property WITHOUT the benefit of a Real Estate Agent representing you and negotiating on your behalf.
Annual studies by the National Association of Realtors ® show that sellers receive 5% – 8% higher purchase prices when selling through a Realtor ® ! Why would a seller receive a HIGHER sales price when they pay a commission to a Realtor ® ?
FSBO sellers find it difficult to get qualified buyers because:
1. Buyers who respond to FSBO ads usually have not been qualified to buy (the qualified buyers retain real estate agents to help them find a house).
2. Real Estate agents do not show FSBO homes (they show homes listed by other agents).
3. Buyers who view FSBO homes are often bargain hunters – they know you are not paying a commission and so they expect you to lower your price.
4. Many buyers who buy FSBO homes are savvy investors who negotiate low prices.
FSBO sellers can not negotiate the best sales deal because:
1. Sellers are emotionally attached to their house and often think the value is higher than it really is.
2. Sellers are not familiar with the "big picture" of the real estate market and its values.
3. Sellers are not attune to buyers and do not know their wants or needs.
4. FSBO sellers must negotiate personally with the buyers, getting involved on an emotional level, rather than as a business transaction.
5. Sellers are inexperienced in mortgage lending procedures and solving complex requirements.
6. Sellers are not experienced with solving glitches, such as low appraisals.
7. Sellers who personally accept deposits may spend the funds (rather than securing with a neutral party).
8. FSBO sellers are at high risk of lawsuits – they are not familiar with legal forms, real estate laws, and requirements.
What does that mean for a seller? They should hire a Realtor® to sell it Right!
A Realtor ® is worth her commission – in marketing, negotiating, and closing on your behalf! Remember that old adage, "You get what you pay for." In this case, it pays to have a professional representative you. So if you think you can not afford to pay a commission – you can not afford NOT to! And in case you're wondering what a commission will cost you – there is no set price, they are negotiable.
Save time, save money, save effort. Do what you do best and allow your Realtor ® to do what she does best – get you the highest price for your house with the best terms available to you!