What’s a FSBO?

FSBO (pronounced fiz-bo) stands for For Sale by Owner. It is the process of SELLING REAL ESTATE without the assistance or representation of a licensed real estate agent or broker. Homeowners generally use marketing and listing services such as forsalebyowner.com, fsbo.com, militarybyowner.com, owners.com, zillow.com, postlets.com, and craigslist.org among many others to market their property, but do not “list” their homes, nor do they pay the full real estate commission once the home is sold.

For sale by owner sign

For sale by owner

Why Go FSBO?

The obvious reason to sell your home by owner is to save on the commission. The average listing fee is 5-6% of the final sales price. By selling your home without a real estate agent, you are saving thousands, if not tens of thousands of dollars.

When you sell your home by owner, and the buyer is not represented by a real estate agent, you pay no commission.

When you sell your home by owner, and the buyer IS represented by a real estate agent, you will likely be asked to sign a one time “Seller’s Permission to Show” agreement. This document says that if this particular buyer chooses to purchase your home, you agree to pay the broker or agent a fee (usually 3%). You can accept this agreement, or decline the offer. If you decline to sign the Permission to Show agreement, and the buyer goes on to purchase your home, they are obligated to pay the real estate agent’s commission in addition to the sales price of your home.

I am of the opinion that if a real estate agent brings the buyer, it is best practice to work with them as if you were also an agent. This means that you agree to co-op with the buyer’s agent and share half of the commission. This creates a win-win scenario, and you are still saving half of the fee!

Selling Your Home by Owner Can Be Hard!

I’m not going to lie, selling your home both traditionally or FOR SALE BY OWNER can be hard. There is a reason why roughly 90% of all FOR SALE BY OWNERS give up within the first two months, and list their homes with a real estate agent. The #1 reason most FSBOs throw in the towel, and hire an agent is that they don’t have a real marketing plan. A FSBO will typically get a lot of traffic within the first few weeks of bringing their homes on the market. When the phone stops ringing after the first month, they become frustrated, and aren’t sure what to do next.  To many sellers, the next logical step is to bring in an agent to take over the process. The first question I ask is, if a typical real estate agent’s listing agreement lasts six months, why are you quitting after just two?

There must first be a change in MINDSET… This means you must also be willing to invest your time and money just as an agent would into the success of selling your home.

The new FOR SALE BY OWNER understands the criteria required for successfully selling their homes without an agent, and the process to take their property from JUST LISTED to CLOSED. The six categories you’ll need to become proficient in are:

  • Price the property competitively in your market.
  • Stage your home to make the best first impression on your buyers, and create a great showing experience.
  • Advertise and market your home across as many avenues as possible.
  • Learn to work with buyers, show your home, and obtain feedback from each visitor.
  • Negotiate the contract and close the sale.
  • Understand, and schedule everything needed from contract to closing.

If you are ready to get serious about FOR SALE BY OWNER MARKETING, feel free to use any of the resources and study material from fsbomethod.com.

To understand exactly what you need to do to successfully SELL YOUR HOME BY OWNER, please click here.

Good luck!