There are always home owners who want to sell their own home without the use of a real estate agent. The thought is that Realtors make too much money and in a hot real estate market, why not go For Sale By Owner (FSBO)? While it is definitely a possibility, let’s look at 5 ways that For Sale By Owners actually lose money.
1. Bad Photos & Staging
This is a big one, a good Realtor is going to hire a professional photographer who will take photos that show the highlights of the property with really good lighting. They should also higher a stager to help declutter the home and make sure that it will capture the eye of the buyers.
Over 95% of all home searches begin online. Most buyers are making a decision on whether or not to see the property in person. If you do it right, the in person showing is actually the second showing for the buyer. If everything matches their expectations then they will be more likely put in an offer.
I’ve visited multiple homes that were For Sale By Owner and they were cluttered. Think about what you like to see in photos of the houses you are looking at. Chances are there is no mess and no clutter so why would you try to sell your home with those distractions?
2. Pricing Too High/Pricing to Low.
This is also a common problem. When selling a home you’ll want to get the opinions of Realtors for the right price. Often times, For Sale by Owners price too high because they have an emotional attachement to the home.
If you are priced too high, the house will sit on the market for too long and then you’ll start getting low ball offers. If you price too low, the market should create a bidding war to drive the price up but the problem with For Sale By Owners is that they don’t get enough eyes on the property to properly create bidding wars.
3. Improper Negotiations.
Not having a Realtor to handle the negotiation can be a big problem for For Sale By Owners. They are emotionally attached to the issue at hand yet they have no experience in negotiations. A good realtor should see the issues coming and should be able to pivot to get you the price and terms you are hoping for.
5. Lack of Marketing the Home
This is probably the single biggest reason that For Sale By Owners don’t make as much money on their own. Putting a sign in the yard isn’t going to do it. Placing a single ad on Craigslist or Zillow won’t do it either. Houses that sell for the highest dollar have a great marketing plan. A well thought out strategy can bring dozens of more showings which will definitely increase the fear of missiong out and will ultimately drive up the sales price.
I talk to For Sale By Owners all of the time who place their home on one website and after two weeks they’ve only had one showing. On the contrary, we’ve all heard of home going on the market and getting 100 showings in the first weekend. Marketing Matters. Don’t skimp here.
5. Not Leaving the House For Showings.
This is a really easy one but it does have an impact. In my experience, most For Sale By Owners want to show their own homes. They want to be home and show people around. This doesn’t give the buyer the freedom to explore the house and think about how they could truly make it their own. Buyers spend less time in the home because they feel like they are putting the seller out by being there. This will reduce the likelihood of getting an offer and will ultimately mean the seller will take less money for the house.
That is the conclusion of The 5 Ways that For Sale By Owners Lose Money. There is plenty of data out there showing that on average, For Sale By Owners net less money for their sale than if they had just paid a commission. Facts are facts but still there are going to be people who want to sell on their own. Please consider the 5 factors here to give yourself the best shot.
Give me a call to discuss getting the highest net return on your home sale. I’m a Realtor with 8z Real Estate in Windsor, CO. Call me (Andy Hawbaker) to discuss selling your Northern Colorado Home.