Each year a small army of home sellers throw caution to the wind and “go it alone” — without the assistance of a licensed real estate professional.
This ever-decreasing band of risk-takers in Reston Virginia, ventures into the land of pricing, marketing, screening, scheduling, showing and paperwork, with the goal of saving some money. It’s often an experience they find less than rewarding.
The numbers (if not the sellers) tell the story.
In 2006, just 12 percent of sellers chose the FSBO (“For Sale By Owner”) route, down from 13 percent the previous year, according to NAR’s 2006 Profile of Home Buyers and Sellers. This is down from about 20 percent in 1987.
But more telling than the decline in FSBOs is the fact that 40 percent of all FSBOs sold their homes to someone they knew prior to the transaction (See The Earl of Real Estate Teams – Flexible Fee approach to this issue). This means that only 7 percent of all home sales are open market FSBO transactions. The rest are simply unrepresented sellers in private transactions.
From NAR’s 2006 Profile of Home Buyers and Sellers
Eighteen percent of FSBO sellers indicated that preparing the home for sale was the most difficult task when selling without the assistance of an agent, followed closely by understanding and performing paperwork (16 percent) and selling within their desired time frame (15 percent).
As for profit — after all is said and done, FSBOs don’t always come out with fatter wallets. Again, the numbers tell the truth.
Homes sold with the help of a real estate professional in 2006 sold on average for 32 percent more than FSBO sales. The median FSBO selling price in 2006 was $187,200, compared with $247,000 for agent-assisted transactions.
- 84% of FSBO’s eventually hire a Realtor® (realtor.org)
- According to a 2006 study by NAR® , only 12% of homes were successfully sold by the owner (realtor.org)
- In 2006, only 5% of buyers purchased directly from owners they didn’t know (realtor.org).
- The vast majority of FSBO sales were to friends or relatives (and if you’re selling to a friend or relative, it’s almost guaranteed that you aren’t getting full market value for your home).
- 91% of buyers are represented by a Realtor® (car.org)
- According to the NAR® 2006 Profile of Buyers and Sellers Report, the median sales price of sold FSBO homes was 17% LOWER than the median sales price of homes sold through Realtors®
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