So, you’re thinking of putting out a For Sale By Owner sign. It’s understandable you want to save money and skip the brokerage fees. But are you doing yourself a disservice? Unless you have the expertise and time to devote to the process, FSBO’s can be counterproductive. That’s what I recently told friends when they asked whether I thought they were crazy to try on their own. Not crazy, I said, just not smart. Selling without representation by an experienced professional is a bad idea for many reasons. Most FSBO’s fail, waste time and bring in fewer dollars.
"I don’t think it's in your best interests to sell on your own,” I explained. “There are too many ways for deals to get derailed. The process may look simple, but it's not. There's much more to a broker's role than opening a door and charging a commission. There's analyzing the market, setting a target price, preparing the space, creating a buzz and online presence, qualifying buyers, negotiating, working with lenders and attorneys, preparing comps for appraisers, managing stress and expectations, not to mention the all-important preparation for co-op board review.”
Do-It-Yourselfers should consider the following:
Do you have the time to undertake the project from beginning to end? Do you have the temperament to answer inquiries immediately, schedule appointments promptly, host open houses regularly and follow up with everyone for honest feedback? Will visitors tell you why your home doesn’t meet their requirements? Will you be peeved with late arrivals, cancellations and no shows?
Can you to distance yourself from your home to look with the eyes of a stylist to declutter and depersonalize the space to prepare for showing? Will you know how to maximize curb appeal?
How will you price? In a buyer’s market, the only way to create urgency is to set a target number—on or very near the anticipated contract amount. If you overvalue your home, you’ll be ignored. But how do you determine the bull’s eye without the benefit of real time case studies? Experienced agents leverage their broker relationships to uncover nuances not found on sites like StreetEasy or Zillow.
Do you have the marketing know-how to reach qualified buyers and the network of agents who represent them? How savvy are you with social media?
How will you screen to ensure purchasers have sufficient cash for a down payment, and the income history and assets to qualify for a mortgage? You’ll want to see preapproval from a recognized lender and sufficient post closing liquidity. Interest rates have been inching up, and any delays can be costly.
You may think you’re a good negotiator, but ego often gets in the way when we trade for our own account. In my personal real estate transactions, I always ask an associate to act as spokesperson to serve as advocate and buffer, so I can save face if I ever offend with an inadequate counter or negative comment.
How will you oversee the intrusive board review process of complete strangers? If their letters are generic, will you worry about offending or have the wherewithal to ask for more detailed references? If financials are unclear and the back-up documentation doesn’t match, what will you do? If the board has questions about the presentation, negativism will begin to breed. Your board is not obligated to provide reasons for rejecting applicants.
Will you have the bandwidth to shepherd the deal to closing, paying attention to important dates, like when the buyer’s loan commitment will expire? Do you have resources on hand, like expeditors and architects, to handle unexpected issues that may arise?
If you fail to attract offers during the all-important first few weeks of marketing and mismanage the property’s introduction, you will have lost an important edge—something which is impossible to recapture.
My friends hired me, admitting there were steps they had underestimated or simply not considered. We attracted 20 buyers at the first Open House and a full price cash offer the next day. We’ll complete our round of second and even third showings before the end of the week to uncover the best possible candidate. We expect to go to contract at the target price or higher, and we’ll present the buyers in the best light possible as this board has an unfortunate history of multiple rejections. The agent’s role is to minimize stress, maximize price and get to the closing table in a timely manner with satisfied buyers and sellers. It’s just not smart to go it alone.