In the busier Roseburg real estate market with limited listing inventory and rising home prices, homeowners might think they’ll save the commission and go For Sale By Owner (FSBO).
I totally get that, and am all for saving money any way I can too. However, there are some valid reasons you might want to rethink that strategy. In fact, for a great majority of Roseburg sellers, it just doesn’t pay off to go for sale by owner.
Here are 5 good reasons it doesn’t pay to go for sale by owner:
1. Most Inquiries Come Online
Did you know that most of the home buyer leads come from the internet, and that a vast majority of the buyers I work with found the home they purchase online? It’s true, check this out:
How buyers found the home they purchased:
- 51% from the internet.
- 34% from a real estate broker.
- 8% from a yard sign.
- 4% from a friend or neighbor.
- 2% Home builder or their agent.
- 1% Directly from the seller or knew seller.
- 1% from a local newspaper.
The truth is, most homeowners just don’t have access to the online sources that professional real estate brokers do, and end up trying their luck at a sign and ad in the News Review.
Bottom line, the days of pounding a sign, placing an ad, and waiting for the phone to ring are long gone. Sadly, many real estate brokers today still rely on these two techniques as their main marketing push. A strong internet strategy is essential in today’s online world.
2. Marketing Reach And Buyer Exposure
The second point you should consider before going for sale by owner is how you’ll expose your home to prospective home buyers.
I read recently that almost 95% of our home buyers start their search for a home online. Does that surprise you? If not, maybe this will…
Only 17% of today’s home buyers claim to looking at print advertising and newspaper ads for homes for sale. Honestly, that number even surprised me a little.
Not all real estate brokers are listing brokers, and not all have a solid internet marketing strategy to market your home and expose it to the largest number of buyers. The internet is not an option when selling a home. What’s your plan?
3. Negotiating With Multiple Parties Is Necessary
When I get called out by homeowners who tried it on their own for a while, they usually admit that they were not prepared to negotiate with as many parties as is required. It can be overwhelming if you’re not prepared.
Here are some of the parties you should be ready to negotiate with.
- The buyer. Surprise, the buyer is negotiating to get the best possible price.
- The buyer’s broker. Most of the time, buyers feel more comfortable working with a broker, if for no other reason than representation.
- Attorney. Sometimes real estate attorney (s) are involved in FSBO and listed properties.
- Title and escrow officers.
- Home inspectors.
- Buyer/buyer’s broker (again). There is often times more negotiation required after the buyer receives the inspection report.
- Appraiser. The appraiser usually discusses comparable sales with the brokers involved to help arrive at market value. What’s your plan if your property doesn’t appraise for the agreed upon price?
4. For Sale By Owner Is Harder Than It Used To Be
Selling real estate in general is just harder than it used to be. In fact, when I first started (in 1994), there wasn’t half the required paperwork that we now have.
Did you know that there are new mandatory regulations and disclosures in Oregon for FSBO-ers and listed homeowners?
According to the same recent NAR study, the most difficult tasks for FSBO sellers was:
- Getting the right price: 18%
- Preparing/fixing up home for sale: 13%
- Understanding and performing paperwork: 12%
- Selling within the planned length of time: 3%
- Having enough time to devote to all aspects of the sale: 3%
Over the past 20 years or so, we have seen a sharp drop in the number of people who go for sale by owner, mainly due to the difficulty. As a matter of fact, only about 8% of the homeowners go FSBO today vs. about 19% 20 years ago.
5. Sellers Net More Money When Working With A Broker
The main reason homeowners choose to go for sale by owner in Roseburg is to save the real estate commission. That makes sense right? It would seem, but the national statistics tell a different story?
The buyer usually comes to the table thinking they will save the commission too. That puts you at odds with the buyer on day 1. Bottom line, you can’t both save the commission.
According to a recent study by the NAR, FSBOs accounted for 8% of home sales in 2015. The typical FSBO home sold for $185,000 compared to $240,000 for agent-assisted home sales.
So, on average, FSBO sellers sell for $55,000 less than listed properties. No that doesn’t mean I can sell your house for $55,000 more than you are currently asking, but maybe…
Now, I’m not mathematician, but I don’t think it’s good math or good business to step over thousands of dollars of potential net profit just to save the 5 or 6% commission.
Check It Out
Before listing or going for sale by owner in Roseburg, it pays to be informed. If you are considering selling your home, and you need help or just have questions, I’m here to help.
Troy Schuyler – Principal Broker at CENTURY 21 The Neil Company Real Estate in Roseburg OR. 541-643-1131