When spring is in the air it means that not only is summer right around the corner but that the real estate market is about to pick up, and a serious amount of houses are going to be bought and sold over the next few months˳ The first question that is usually going to come up when someone starts to think about selling their home is if they should use a real estate agent or if they should try to sell the for sale by owner˳ In this article we will talk about what for sale by owner really is all about and if it is the right pick for your situation˳
What Does FSBO Mean?
A for sale by owner sale is any type of sale that the owner is going to be handling the process by themselves˳ The home is not being handled by any type of real estate professional during the sales process˳ In the US it is not required to have a real estate agent during the home sale process, however some states do require a real estate attorney to be involved to make sure that everything is done legally˳
The FSBO route can be done through a variety of methods˳ The majority of homeowners in the U˳S˳ use the traditional for sale by owner process in which they mimic the process of an agent but become the agent of their own home˳ However, that is not the only method˳ FSBO sellers can sell their home during a home sale auction, trade the home with another owner, or sell directly to an investor˳
The Advantages of FSBO
The most enticing advantage of FSBO is the savings of a real estate commission fee˳ When working with a real estate professional, they usually charge between 5 to 8 percent of the purchase of a home upon closing˳ This can be quite a significant amount for many homeowners˳ For example, if your home sold for $300,000 using a real estate agent, that would mean that you would forgo $15,000 to a real estate agent at the conservative percentage of 5 percent˳ That is thousands of dollars, even tens of thousands for many owners, that is taken out of the profit of selling a home that could be used for a vacation, college funds, and retirement savings˳ So why use a real estate agent if you don’t have to?
The Disadvantages of FSBO
The reasons that most people choose to sell through an agent is because the process of selling a home can be very complicated, time consuming, and tedious˳ If you are selling privately you are going to be responsible for listing, marketing, showings, negotiations, and the closing all by yourself˳ A buyer may ask you questions about the home or the home sale process that you are not sure of the answer˳
Those wanting to sell in this way must put in the time and effort to be well-versed in the real estate process themselves and willing to do what it takes to get their home sold˳ Sellers that are unable to commit the time may have a house that stays on the market for months before the owner breaks down and uses a real estate agent˳ Thus, if you have full time job or business, a huge family, or an otherwise full life or going through a large life change, it will be difficult to sell your home on your own–not impossible, just difficult˳
What FSBO Doesn’t Mean
Just because you are selling your home on your own does not mean that you have to do each step of the process on your own˳ There is more to the real estate world than just buyers, sellers, and agents˳ For a flat fee, a listing agent can help you list your home˳ A home appraiser can evaluate your home for the best selling price˳ A real estate attorney can walk you through the details of any offer right up until closing˳ Thus, you can still have professional help in parts of the sale that you are not comfortable handling˳
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