For Sale By Owner. Think Its Easy?

February 6th, 2013

house for sale

There is a certain section of society that thinks they can do everything themselves. I am all for a do-it-yourself project. But I find that usually it pays to have someone else do it for me. I find that professionals can do it better. And quite frankly, after saving me time to allow me to stay productive in my work and earn more money, they can do it less expensively. For those of you that think you can sell your home on your own, known as a For Sale By Owner (FSBO), good luck with that! I know there is a perception of big savings.

Let’s apply some logic to this.

Think about all that goes into selling a home and the hours required to do it all. I will outline it below. Then think about the hours and labor it takes to do the below. And to do it well, legally, and efficiently! How will people have time for all of this?

For Sale By Owner To-Do List

  1. Analyze the market and properly price your home for sale. Most FSBO’s price too high, and their home sits on the market, wasting what? Time! And time is what? Time is money! Or, they may price too low, and give away money.
  2. Purchase a “For Sale” sign.
  3. Put up the “For Sale” sign.
  4. Write up the description of the home.
  5. List the home for sale in the local MLS.
  6. List the home for sale on numerous other websites.
  7. Think of marketing material.
  8. Order and pay for marketing material.
  9. Distribute marketing material (by mail, fax, email, word of mouth, etc).
  10. Hold open houses.
  11. Answer the numerous questions from potentially interested parties.
  12. Know real estate contract law or hire someone to advise you.
  13. Obtain a copy of a sales contract or hire someone to draft one. Will it have all the necessary clauses to protect all parties? Will it be current? Will someone be left legally liable for an omission?
  14. Negotiate, field, and sign off on the offers.
  15. Analyze a buyer’s finances and ensure they are qualified. (For more on why lenders sometimes cannot even tell if a buyer is qualified, click here).
  16. Suggest, monitor, and interact with lenders, home inspectors, title companies, termite inspectors, movers and much more.

I am sure I missed some steps, but I am tired of writing.

Does your time matter?

It takes an enormous amount of hours to pull all of this off and it is quite expensive. Marketing is not cheap. Your time and labor are not cheap. Lawyers to write contracts are not cheap. To see how realtors are justified in their commission, click here.

Buyers want some money back for lacking representation

There is one important thing to realize is sellers rarely expect, but almost always happens. Buyers want your commission savings anyway! I cannot tell you how many buyers in the past have come to me and said that they have found a home that is FSBO. They explain they plan to lowball their offer price up to 6%, accounting for the fact that the seller is selling without a realtor and hence saving the commission. Buyers are not stupid. They know that FSBOs are saving as much as 6% without a realtor. They have no intention of giving you that money if there is no representation involved on their side, nor yours. So the money that you think you will be saving on a FSBO is likely going to be taken from you anyway.

Even if the seller chooses to sell on their own, the buyer will likely have a realtor

Also, a potential For Sale By Owner needs to realize that a buyer will likely have a realtor that has been representing them. Buyers usually have realtors helping them look for a home, and that they have possibly signed a commitment with. So the buyer’s realtor will want their 3%. Think about the math. A FSBO pays the buyer’s realtor 3%. Then factors in all the time spent marketing and selling the place. There is also the potential for lost revenue because it was mis-priced. And a buyer is likely going to want to reduce the price since a FSBO has no realtor to pay. So why would you sell as a FSBO, and if you do what have you really saved?


I wouldn’t hunt my own food, fix my own car, renovate my own kitchen, pull my own wisdom tooth, represent myself in a court of law, and perform my own surgeries on myself. So why would I try to sell my own home? I love life too much. I pay the pros to do what the pros do, so that I can enjoy my life.

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Brian Martucci is a loan officer for Capital Bank Home Loans, a division of Capital Bank, N.A. He has been in the mortgage industry since 1986 and has served in a number of roles, including loan processor, loan officer, mortgage broker, branch manager, and vice president. Brian Martucci – NMLS# 185421. His opinions do not necessarily reflect the opinions and beliefs of Capital Bank Home Loans or Capital Bank. Capital Bank, N.A.- NMLS# 401599. Click here for the Capital Bank, N.A. “Privacy Policy”.

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