Are you ready to sell your home? Considering selling your home yourself? As real estate consultants we are here to guide you through every process. Consider working with an agent or firm when it comes to selling! Here are 9 Reasons Why For Sale by Owner Listings are a Really Bad Idea.
When dealing with a FSBO (For Sale by Owner), things can get a little sideways. Unfortunately, scams do happen. Common scams include loss of earnest money when sellers change their mind, incorrect papers, false purchases through a third party, and identity theft when asked for personal information.
Liability is on the seller.
Real estate transactions can be complex and include a lot of different moving pieces. People make mistakes, and if something happens, it’s on you or the seller. If a seller claims the flooring is hardwood, but in reality, it’s actually luxury vinyl, the buyer is going to have to accept that. In this case, an agent would have caught the mistake or covered it with insurance.
There’s a lot of paperwork. A lot.
Understand all the paperwork involved with real estate transactions is pretty tough if you don’t deal with it on a regular, consistent basis. In some cases, legal forms are needed. There are contract templates that can be downloaded, but is it really worth making a mistake?
Bad deals happen.
Homeowners who are selling their home don’t have the time to truly understand the process. They also don’t know the market value or understand market reports. At the end of the day, you could be paying a lot more than the home is actually worth. Also, after signing the contract, you may realize an error has been made. In that case, you would be stuck in a bad deal.
You could be there for a while.
Unless the seller knows someone willing to buy the home, FSBOs tend to remain on the market longer. This happens because agents are constantly marketing their listings. Leave it up to agents when it comes to getting the word out. Relying on a sign in the yard isn’t enough and agents are less likely to bring potential buyers when there is no incentive.
No representation for FSBOs.
If something goes wrong, there’s no one to call. If you have questions about the process, your resources are limited. Agents are there to walk you through the process and explain the industry.
Inspections are tricky.
Sellers can get stuck with unnecessary and expensive repairs. For example, say you are selling your 15-year-old home after the inspection. You’re told the railing needs to be changed because code has changed. Other code changes and violations were listed and now the buyer demands the changes be made before closing the deal. Unfortunately, the inspector didn’t know the items were to code standard when the house was built and therefore, the seller isn’t responsible.
If you are listing your home as a FSBO, you’re probably just trying to save money. That’s great. Keep in mind, you’ll be paying for a lot of extras though. Those costs you didn’t really think of include signs, flyers, photography, the MLS listing itself, attorney fees, warranty, home inspection, pest inspection, contracts, credit report for buyers…the list goes on and on.
Time is money.
Agents have plenty of resources at hand. That’s why using a real estate agent can speed things up. As a homeowner listing a FSBO, it will take a lot longer. Chances are you’re unsure of the process itself and will spend hours researching the market and contracts. Just leave it to the pros.