What is FSBO and Why are People Using it to Sell their Property?

What is FSBO and Why are People Using it to Sell their Property?

If you are planning to sell your own home, chances are the first thing you will do is to find a licensed real estate agent. Truth be told, hiring a real estate agent is the safest thing you can do to sell property.

After all, they are certified professionals with the experience and know- how to have your home sold in the market without inconvenience to you.

But does safest mean the same as smartest?

There is a growing trend of property owners who are ditching the real estate agent when selling their own home. This approach is called FSBO or “For Sale By Owner”.

FSBO removes the real estate agent from the sales equation. The property owner does everything the real agent would do in a standard real estate sales transaction:

  • Market and Promote the Property
  • Create Marketing Collateral
  • Update all Content in Social Media
  • Take Incoming Inquiries
  • Schedule Home Visits and Inspections
  • Price the Property
  • Negotiate with Prospective Buyers
  • Prepare the Contract of Sale

If FSBO seems daunting, it is not. With a bit of planning and organization, you can pull off selling your own property and generate higher returns.

When you remove the real estate agent from the sales process, you automatically save between 2% to 3% in commission payouts. In addition, you have better control and management of your money.

The sum total of the other services provided by the real estate agent as summarized above can easily increase your total expenses to 6% to 8%.

What does a 6% cost savings look like? If your property’s final negotiated price is $500,000 by going FSBO, you improve your net return by $30,000!

In addition, going For Sale By Owner increases your chances of selling your home on time.

What does “on time” mean in a real estate transaction?

If your property isn’t sold within 4 months, its perceived market value will drop exponentially. You will be leaving thousands of dollars on the table if you cannot sell your home right away.

But doesn’t a real estate agent have all the connections and a large network of prospective buyers?

Yes, but he or she also has a lot of clients.

When you ask a real estate agent to sell your home, you will be required to agree and sign an Exclusivity Agreement. This means only the agent has the authority to sell your property.

It may seem all well and good. You might think the agent has your best interests at heart and you’re probably right. But this is also the agent’s livelihood and source of income.

If your property is located in an area of sluggish demand and stagnant prices, the agent will place more attention on selling homes in fast- moving locations such as Sydney and Melbourne.

So doesn’t the Exclusivity Agreement seem onerous?

By going the FSBO route, you can devote 100% more time and effort in selling your own home. If you have a full- time job, a family and the list of tasks are overwhelming, why not hire a Virtual Assistant?

A Virtual Assistant is a professional who can manage administrative jobs and carry out support services.

You can delegate the following tasks to a Virtual Assistant:

  • Set up an account for your home at a reputable FSBO company; these are online sites dedicated for property owners who want to sell their own home. Hundreds of followers can view your property and submit offers.
  • Promote your property in social media and link these accounts to your FSBO page.
  • Take in all calls and inquiries.
  • Schedule home visits.
  • Prepare and review contracts.

Hiring a Virtual Assistant will not cost you much and will get a lot of things done for you.

So if you are planning to sell your own home, consider going FSBO. It will save you both time and money.

 

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