For sale by owner

For Sale By Owner, or FSBO, is the process of selling real estate without representation by a real estate agent. There are many factors to weigh when considering selling FSBO v. hiring an agent. Will I price it right? Who will prepare the documents? Do I really have the time and patience for this? Will I get in legal hot water? One of the primary reasons owners choose to sell on their own is to avoid paying the real estate commission which can amount to a hefty sum. In the US the combined fees for the listing agent, his brokerage, the buyer's agent and his brokerage are, on average, 5 to 6% of the selling price of the property which for a $290,000 home is between $14,000 and $17,000. These facilitators are state-specific and are becoming more common as more owners choose to sell on their own.

There are many options open to the FSBO seller. Many companies both online and brick and mortar offer various levels of services and price points. These include:

The home sale transaction used to be simple. Now it involves a huge stack of documents and legal requirements which can make selling FSBO a challenge. For this reason, the FSBO Seller is wise to hire an attorney who specializes in FSBO transactions. While they will incur a fee for this, it will be far less than the amount saved by not paying a real estate commission. In most states, there are detailed legal requirements pertaining to sellers and disclosures they must make. In California alone, a stack of disclosure forms are required to be completed when the seller is offering a home for sale to the public. These forms that are within the bailiwick of the real estate agent is nearly impossible for a seller to come by. Real estate lawyers have all of the required forms, documents and expertise necessary.

Some interesting FSBO statistics can be found in the National Association of Realtors (NAR) 2015 Profile of Home Buyers and Sellers. The median age for FSBO sellers is 54 years. Seventy-seven percent of FSBO sales were by married couples that have a median income of $104,100. FSBO homes sold more quickly on the market than agent assisted homes. All FSBO homes typically sold in less than two weeks—often because homes are sold to someone the seller knows. Seventy percent of successful FSBO sellers were satisfied with the process of selling their home. Nine in 10 FSBO sellers who both knew and did not know the buyer were satisfied with the home selling process.

Since the market recovered following the 2007 real estate recession, there has been a steady increase in FSBO sales, up nearly 30%. According to a 2016 report by the National Association of Realtors (NAR) regarding home buyer and seller trends, Home Buyer and Seller Generational Trends Report 2016, 8% of surveyed real estate transactions between July 2014 and June 2015 were FSBO. The record percentage of 20% of US real estate transactions (since tracking started in 1981) took place in 1987.

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Wikipedia