I'm considering offering my home FSBO and have a couple of questions to those with experience going that route.
Is it helpful to offer an additional fee to potential buyer's agents (say $500 or $1000) to induce them to show the property?
Also, would I, as a home owner, have any additional liability exposure for selling FSBO vs going through an sellers agent? (I live in Ohio.)
Thanks in advance!
Your best bet is likely spending that money to pay someone to list the property on MLS for you. You can find places who will list you on MLS for $500 or so, that will get you on the list of every agent in the area and make you more findable for buyers.
As a FSBO the buyer's agent would just be responsible for drawing up the contract (which they already do anyway) and the other things required.
Just know that selling as a FSBO will have your phone blowing up from agents who would like the opportunity to get the listing from you, so be ready for that.
Brandon M - thank you for your comments. In terms of how RE is traditionally done, I'm thinking that buyers agent does most of the "heavy" lifting and, really, they should probably get more of the deal than the sellers agent. The thing that I'm not certain about is whether I would be open to more liability as an FSBO seller than I would if I went the traditional route with a sellers agent??
I'd recommend hiring a real estate attorney to figure out the best way to structure the deal to limit your liabilities. I'd also have your attorney handle all of the paperwork.
Jennifer - thanks for the advice. I think there are some attorney's in the area who specialize in RE and I can check with them. Thanks again!
As a real estate investor and licensed agent who can't represent you in any way, and as someone who also worked for a real estate attorney who flips homes, I can't recommend hiring a listing agent enough. There's no doubt that the work involved to sell a home breaks down to an absurd hourly rate at 1-3% (you should be getting about 1.5% if you work with an agent regularly), but the cost/risk of not hiring an agent is far more expensive.
Firstly, that commission does pay for some work, and although it doesn't take the agents very long, it will take you way way way longer. Not only do you not have the experience and systems they have (the good ones), but you don't have access to the MLS, which is arguably worth more than all other marketing moves combined. You can put your home on Zillow and generate attention, but not necessarily the kind you want: listing agents, low ballers, buyer's agents who secretly just want your listing. That's why statistically you're likely to either eventually list your home with an agent or sell it 12ish% below market value.*
Secondly, even if you are saving yourself money, the number is super small, because now you have additional costs/risks. Not including your time, there's the legal risk of being self represented (such as accidentally not disclosing enough), and if that's what the attorney is for, a savvy buyer or buyer's agent would negotiate that you at least partially pay for a third party to close.
This is not to say you can't successfully go FSBO; real buyers exist off the MLS. But If you're looking to maximize your ROI, I recommend either finding an agent you can work with regularly who will give you a proper price or going to a discount brokerage that legally "represents" you and puts your home on the MLS.
You can still choose to give more to the buyer's agent, but it's probably not worth it, since only a minority of agents would sell their buyer on a house because of that kind of personal gain; it normally looks like "Hey, I'm going to list my house for more than your client should pay, but I'll cut you into my extra profit if you screw your client. It's no big deal, your buyer probably won't read the closing documents and remember how you recommended against the other place."
If you want more control the big things are good pictures, a good description, a good schedule,** and more than anything else, a good listing price. According to Zillow Talk (which was pretty good) and my experience, it's best to list a property just below what it is worth for a quick (and hopefully competitive) sale.
*NAR, which could have an incentive to make that calculation output a big number, but still, the number could be 2% and selling FSBO still could be a bad
**list Wed-Fri, open houses that weekend, highest and best on Monday, sign by Tuesday #perfectworld
http://pellego.com | WA Agent # 111271
I sold my last house fsbo. I also called every top realtor and offered a 3% commission if they sold my property. It's a small town by the way. I still ended up selling it myself without a buyers realtor. It was easy. We got a contract from the closing attorney and that was about it from my end other than letting the appraiser in and also getting a termite inspection. Simple process.
Originally posted by @Kyle Penland :
I sold my last house fsbo. I also called every top realtor and offered a 3% commission if they sold my property.
I am curious if others have had success with this strategy? We have tenants in the house until the middle of March. I was thinking of trying this strategy until listing with a discount agent when the tenants move out.
I use a flat-fee MLS service. A licensed agent is assigned to your listing for overseeing everything, and all necessary forms are provided (disclosure, AOS, addendums, etc.). The company I used offered a choice of a 6 or 12 month contract and you can select the amount you'd like to offer a buyer's agent, which would allow you to offer a little extra. There is no commission if you find the buyer.
You provide your own photos, description, warranties, or any other info you'd like to offer. I've done this for a couple of properties and it works out really well. In addition to being on the MLS, the listing is fed to other sites (Zillow, Trulia, Realtor.com, and plenty more).
Most companies offer a variety of packages - just look for a few in your area. Usually there are options to upgrade signage, display additional photos, add a virtual tour, lockboxes, etc.
Doing it completely on your own is possible too, but @Brandon M. is right - your phone will blow up with a FSBO.
@Kyle Penlamd - great to hear that you had success going that route. It's very encouraging to hear your success story :)
@Renee Gambacorta - I'm pretty certain that I'd need to get on the MLS so that my listings can be pushed out to the typical sites. I found my last home on one of the sites so, in my experience, it makes sense to get listed that way. Can I ask if your flat fee MLS service a local one or one that might be able to service me as well? (Also, I checked out your site and love that Brazilian hardwood.)
I also use a local flat fee MLS broker to get my properties on the MLS and attract buyers. I offer 3% to the buyers agent (local standard is 2.5-3% so I stay on the high side of that). My flat fee broker gives me two options, up front payment of $109 (6 photos) or $139 (30 photos) for 6 months of MLS listings or $39 up front and $256 when it closes for a 6 month listing. Longer listings are also available for slightly more. The second option allows for low up front costs in case you are listing the house for sale or rent and don't want to pay all the money up front for the sale listing. I have a lot of experience buying and selling houses and typically don't recommend this option to people who have limited experience. However, the buyers agent does most of the work. You just need to keep them on timeline per the contract and ensure everything is getting done.
Good luck with whatever you decide.
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