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Started By
Message
Home real estate: FSBO vs. Realtor
Posted on 1/22/10 at 12:58 pm
Posted on 1/22/10 at 12:58 pm
Pros?
Cons?
Cons?
8
Posted on 1/22/10 at 1:09 pm to SloMeaux
Buying or Selling?
Posted on 1/22/10 at 1:11 pm to SloMeaux
How big a house are you selling? To me that has a lot to do with it. I'd say under $150-175, you can probably sell it yourself with some success, but over $175K, most people are going to have realtors.
Pros of FSBO- Save the 6%, You talk to the buyers directly and get a better feeling of the feedback, you can schedule your own showings
Cons of FSBO- Not as much exposure (although there are a lot of FSBO websites out there that are pretty popular), limited buyer pool (people that have agents do not look at FSBO on the recommendation from their agent), all the phone calls you get from agents wanting to list your house
Pros of Realtor- They make all the phone calls and do most of the negotiating for you. They have all the paperwork you'll need and they'll know most all of the special circumstances you might encounter. They have the tools to be able to give you all the information you need to sell your house (comps, upgrades, etc).
Cons of a Realtor- 6% (at least) commission. Some realtors can be pushy and try to talk you in to something you don't want to do.
Bottom line is, all realtors are going to tell you that you can't sell your house without them, when in reality, it's not that hard if you have a little knowledge about the basics of staging/marketing your house and you want to do a little research on what comparable houses are listed for in the area. I've sold a house with a realtor, and I've sold a house by owner, and I think I could have sold both by owner if we weren't both starting new careers at the time.
On the other hand, I'm almost finished taking the Real Estate licensing class, so I hope that there aren't too many people out there that want to sell by owner.
ETA: This is from a sellers prospective.
Pros of FSBO- Save the 6%, You talk to the buyers directly and get a better feeling of the feedback, you can schedule your own showings
Cons of FSBO- Not as much exposure (although there are a lot of FSBO websites out there that are pretty popular), limited buyer pool (people that have agents do not look at FSBO on the recommendation from their agent), all the phone calls you get from agents wanting to list your house
Pros of Realtor- They make all the phone calls and do most of the negotiating for you. They have all the paperwork you'll need and they'll know most all of the special circumstances you might encounter. They have the tools to be able to give you all the information you need to sell your house (comps, upgrades, etc).
Cons of a Realtor- 6% (at least) commission. Some realtors can be pushy and try to talk you in to something you don't want to do.
Bottom line is, all realtors are going to tell you that you can't sell your house without them, when in reality, it's not that hard if you have a little knowledge about the basics of staging/marketing your house and you want to do a little research on what comparable houses are listed for in the area. I've sold a house with a realtor, and I've sold a house by owner, and I think I could have sold both by owner if we weren't both starting new careers at the time.
On the other hand, I'm almost finished taking the Real Estate licensing class, so I hope that there aren't too many people out there that want to sell by owner.
ETA: This is from a sellers prospective.
This post was edited on 1/22/10 at 1:13 pm
Posted on 1/22/10 at 3:54 pm to LSUGUMBO
I sold my first house, asking below $150,000, the FSBOBR route and it sold in a week and a half.
I listed my 2nd house with FSBOBR, asking $270,000, and not many calls. Ended up selling with an agent, which also took a while.
I believe it depends on the asking price.
If you are not in a time cruch, you owe it to yourself (or whoever) to try FSBOBR because it's minimal cost.
If you are in a time crunch, I'd go the agent route.
No one knows exactly what will happen either way...
I listed my 2nd house with FSBOBR, asking $270,000, and not many calls. Ended up selling with an agent, which also took a while.
I believe it depends on the asking price.
If you are not in a time cruch, you owe it to yourself (or whoever) to try FSBOBR because it's minimal cost.
If you are in a time crunch, I'd go the agent route.
No one knows exactly what will happen either way...
Posted on 1/22/10 at 6:37 pm to SloMeaux
I am so glad we had a realtor with our recent home purchase. 
Let me know if you need recommendations.
So much easier to email, call, text her to do something than it is for me to stop what I'm doing. I was very involved in the searching and buying process. The fiance was as much as he could be. He found tons of listings online.
They are also great resources for rec lenders, title company, home warranties, inspectors, etc.
This is all from a buyers point of view. Never sold a home, but pretty sure I would go with a Realtor.
If it is for you, with your area you would probably be ok selling fsbo. fsbobr.com is a good site. there are others. zillow.com is good to see what homes sold for and are listed for in your area. I got pretty good at this. But a realtor can do a market comparision.
Let me know if you need recommendations. So much easier to email, call, text her to do something than it is for me to stop what I'm doing. I was very involved in the searching and buying process. The fiance was as much as he could be. He found tons of listings online.
They are also great resources for rec lenders, title company, home warranties, inspectors, etc.
This is all from a buyers point of view. Never sold a home, but pretty sure I would go with a Realtor.
If it is for you, with your area you would probably be ok selling fsbo. fsbobr.com is a good site. there are others. zillow.com is good to see what homes sold for and are listed for in your area. I got pretty good at this. But a realtor can do a market comparision.
This post was edited on 1/22/10 at 6:40 pm
Posted on 1/22/10 at 6:43 pm to LSUGUMBO
Gumbo - if you're planning on selling in Shreveport, let me know. We've got a KW office there and the training is awsome with our company plus a lot of other benefits that you should know about before you make a decision. All companies are defnitely not alike in R/E.
Posted on 1/22/10 at 6:53 pm to SloMeaux
By the way - I've done both also. As far as selling, it isn't so much the price, as the house, house location and your own personal circumstances. It can be just as hard to sell a $125,000 house as one that is $600,000. A realtor can certainly help you avoid some pitfulls if they are good. If your are buying or selling, get recommendations to find someone that will handle it best and watch out for your best interests. If you're in BR or Lafayette, let me know - I've sold in both places for the last 18 years. Good luck!
Posted on 1/23/10 at 6:49 am to SloMeaux
I would certainly go with FSBO. There was a very similar thread on the OT a few days back.
FSBO vs Realtor
In this day of instant communication and archived information - realtors are a big ripoff for the price that they command.
If I were to offer you 3% of your house sales price (you might have to give the other 3% to the buyer agent) and merely insisted that you learn
1. To fill out forms
2. Find a good Title company
3. Look through the yellow pages and find a good home inspector.
4. Ask a friend with some fashion sense or pay someone to help with staging.
5. Advertise your house on online sites (paid and free). In fact depending on where you are selling you can get an MLS listing anywhere between $200 and $400
You decide how much your time and effort is worth and then decide.
ETA: Before people say this is only for selling and not buying please consider this.
The agent who is showing you houses is not doing it out of the goodness of the heart and is depending on the commission at the end of the sale.
The seller is obviously going to include the 6% commission into his pricing because he has a certain profit in mind.
It might not be the entire 6% but it would certainly be higher than if the commission were not there.
So Realtors affect both sides of the issue. Sellers can sell for less and buyers can buy for less.
I would certainly pay for realtors if the cost were a constant for the services provided and not a percentage of the sale price.
why is selling a 500,000 house any different than a 550000 house and why do they get the extra $3000 for no extra work at all?
FSBO vs Realtor
In this day of instant communication and archived information - realtors are a big ripoff for the price that they command.
If I were to offer you 3% of your house sales price (you might have to give the other 3% to the buyer agent) and merely insisted that you learn
1. To fill out forms
2. Find a good Title company
3. Look through the yellow pages and find a good home inspector.
4. Ask a friend with some fashion sense or pay someone to help with staging.
5. Advertise your house on online sites (paid and free). In fact depending on where you are selling you can get an MLS listing anywhere between $200 and $400
You decide how much your time and effort is worth and then decide.
ETA: Before people say this is only for selling and not buying please consider this.
The agent who is showing you houses is not doing it out of the goodness of the heart and is depending on the commission at the end of the sale.
The seller is obviously going to include the 6% commission into his pricing because he has a certain profit in mind.
It might not be the entire 6% but it would certainly be higher than if the commission were not there.
So Realtors affect both sides of the issue. Sellers can sell for less and buyers can buy for less.
I would certainly pay for realtors if the cost were a constant for the services provided and not a percentage of the sale price.
why is selling a 500,000 house any different than a 550000 house and why do they get the extra $3000 for no extra work at all?
This post was edited on 1/23/10 at 6:54 am
Posted on 1/23/10 at 1:14 pm to CalTiger
FSBO is not that hard to do.
Posted on 1/23/10 at 2:06 pm to fatboydave
We did FSBO when we sold our first home and it worked out very well. We priced it right and was in no hurry to sell. After two months we got $2K less than our asking price.
Had a bad experience with a family friend as our agent when we purchased that first house, so the wife did alot of research and decided we would sell it ourselves.
There are good agents out there, but we had a good time making fun of some of the ones that would come into our house for a showing.
Had a bad experience with a family friend as our agent when we purchased that first house, so the wife did alot of research and decided we would sell it ourselves.
There are good agents out there, but we had a good time making fun of some of the ones that would come into our house for a showing.
Posted on 1/23/10 at 3:34 pm to lsubandmom
quote:
Gumbo - if you're planning on selling in Shreveport, let me know.
I will be selling here in Shreveport. I'm not sure who I'd like to be working with, but I'll definitely keep KW in mind when I'm looking. I hadn't thought about them until you said something. Thanks for the advice.
Posted on 1/23/10 at 4:04 pm to LSUGUMBO
Contact me at vcates@kw.com. I'd be happy to talk wth you about what you can expect.
Posted on 1/23/10 at 8:11 pm to lsubandmom
This is simple
Realtors have access to real time sold info while the general public does not. You may think that the public does but many of the internet sites that make such claims are inaccurate and/or out OF DATE.
Realtors have the buyers for the most part as the Seller pays for their representation. Most buyers are aware of this.
FSBO are often not priced right but even if they are and you do happen to receive a contract, would you know the rules and regs in order to avoid liability. Most lawsuits in real estate transactions involve FSBO. More important is the contract to close than just securing a buyer. A common mis conception is that the real estate atty will handle it. While they can conduct the act of passing the sale they usually dont represent either buyer or seller. Therefore they have no liability in that dept.
Most people do between 3 to 6 real estate transactions in a life time. Therefore using licensed pros that carry E&O insurance would be a prudent decision on your part.
Its only fair that I tell you I am a licensed LA Contractor, Home Inspector and Realtor.
Realtors have access to real time sold info while the general public does not. You may think that the public does but many of the internet sites that make such claims are inaccurate and/or out OF DATE.
Realtors have the buyers for the most part as the Seller pays for their representation. Most buyers are aware of this.
FSBO are often not priced right but even if they are and you do happen to receive a contract, would you know the rules and regs in order to avoid liability. Most lawsuits in real estate transactions involve FSBO. More important is the contract to close than just securing a buyer. A common mis conception is that the real estate atty will handle it. While they can conduct the act of passing the sale they usually dont represent either buyer or seller. Therefore they have no liability in that dept.
Most people do between 3 to 6 real estate transactions in a life time. Therefore using licensed pros that carry E&O insurance would be a prudent decision on your part.
Its only fair that I tell you I am a licensed LA Contractor, Home Inspector and Realtor.
Posted on 1/23/10 at 8:21 pm to MoreOrLes
quote:
Its only fair that I tell you I am a licensed LA Contractor, Home Inspector and Realtor
I would have never guessed.
Posted on 1/23/10 at 8:37 pm to CalTiger
quote:
The agent who is showing you houses is not doing it out of the goodness of the heart and is depending on the commission at the end of the sale.
True as this is what they do for a living.
quote:
The seller is obviously going to include the 6% commission into his pricing because he has a certain profit in mind.
False using any fixed commission rate is a violation of anti trust laws. Each listing is negotiated on its own merits between you and the listing agent. Secondly, the Sellers certain profit in mind is secondary to what the current market is yielding. You wont really know that without an experienced agent. Even if you did, this is the very sentiment that may prevent your sale.
quote:
It might not be the entire 6% but it would certainly be higher than if the commission were not there.
False again for the same reasons above.
quote:
So Realtors affect both sides of the issue. Sellers can sell for less and buyers can buy for less.
False As the FSBO sign will send the message that the seller is avoiding Broker commission in addition to trying to save it for themselves. Again impeding the sale of the property which is the ultimate goal.
quote:
I would certainly pay for realtors if the cost were a constant for the services provided and not a percentage of the sale price
You have no idea how much work is actually involved on the part of the Realtors. If it's that easy and lucrative why dont you give it a shot.
quote:
why is selling a 500,000 house any different than a 550000 house and why do they get the extra $3000 for no extra work at all?
LIABILITY is larger for one...but the challenges present to sell one home are most often totally different from another. Comparing commissions totals on just sales prices is totally ridiculous.
BTW the laws pertaining to Real Estate in CA are completely different than Louisiana. Just because you may have bought and/or sold a home in both states does not make you an expert as Realtors are in such matters.
Posted on 1/23/10 at 8:42 pm to notiger1997
quote:
Had a bad experience with a family friend as our agent
This is a common tale. Using a friend in a business transaction is usually not a good idea.
And, your are correct there are some really good agents that are full time and sell a lot of real estate in any given year and there are also some who should not be in any business.
Posted on 1/23/10 at 10:18 pm to MoreOrLes
quote:
True as this is what they do for a living.
Doing something for a living doesn't always mean that it is something that is worthy of paying a huge sum. It always come down to how much it is worth to me as a buyer or seller.
quote:
False using any fixed commission rate is a violation of anti trust laws. Each listing is negotiated on its own merits between you and the listing agent.
An agent commands a percentage of the sale as his commmission - I am the seller this means that I have to shell out a certain amount and therefore I keep this in mind when I decide on the final price of the house - Like I said before I don't have to add it completely but it certainly will increase it.
quote:
Secondly, the Sellers certain profit in mind is secondary to what the current market is yielding. You wont really know that without an experienced agent. Even if you did, this is the very sentiment that may prevent your sale.
I call BS on this - as a seller I might be delayed by not more than a few weeks to get the information that I need regarding the existing market, sales figures and expectations on the price of the house.
If I am willing to put in the time and effort to understand the number of sales in my area, the number of days houses have been in the market and the amount they sold for - it is not difficult to come up with the number.
Is it work - YES : is it rocket science involving 10 years of concentrated study - NO.
quote:
It might not be the entire 6% but it would certainly be higher than if the commission were not there.
False again for the same reasons above.
Again I say that when I sell, as a seller , I know that I have to give money to someone else and take that into account when I put up the price because it cuts into my profit. Sometimes it becomes higher than what the market would pay for the property and hence I have to lose out on my profit by agreeing to a lower price because of the commission.
quote:
False As the FSBO sign will send the message that the seller is avoiding Broker commission in addition to trying to save it for themselves. Again impeding the sale of the property which is the ultimate goal.
I didn't go into detail in this thread and had pointed out the relevant points in the other link but here goes.
1. You can make it very clear to brokers that you are willing to give the 3%. BTW your usage of avoiding commission seems like a distinct negative connotation as though someone is being deceptive-I am saving money by not giving it to someone who, I think, should be doing it for much less.
2. If the buyers do come with an agent and given the economy the agent is not going to say No to his/her part of the commission merely because it is FSBO.
3. There are plenty of educated buyers ( minority still but growing) who will be able to do the same things as the seller does with regards to reading the documents or hiring a lawyer or any other pro to do it for them at even the seller's cost - because he knows that would be cheaper than the commission.
4. If these things are done - the sale would in fact be hastened because of the lower price.
quote:
You have no idea how much work is actually involved on the part of the Realtors. If it's that easy and lucrative why dont you give it a shot.
Dude I listed out the points that needed to be covered. Apart from those please point out what needs to be done.
Please don't pull out the naive - "if you think it is that easy - you do my job" card in the middle of a discussion.
Not everyone has the predisposition to do or like certain careers- doesn't mean they cannot do it. Doctors , lawyers make money - I like computers and engineering, so didn't want to take the others up regardless of the end result.
quote:
quote:
why is selling a 500,000 house any different than a 550000 house and why do they get the extra $3000 for no extra work at all?
LIABILITY is larger for one...but the challenges present to sell one home are most often totally different from another. Comparing commissions totals on just sales prices is totally ridiculous.
The challenges are totally different in selling a house that is marked at 500 and 550? I call BS on that. Often in a street there are houses that differ by as much as 15% based on not just the additions done to the house by adding a bigger room but on the location of the house (not being on the main road/curbside appeal/structures around and in the house/ garden/culdesac/next to the ramshackle house) as well. There is no less work done in either of the cases.
What if the market were good and you expected 500 and got 550? You did squat for the extra 50 and are raking it in for no other reason except that you were lucky to be the agent there.
quote:
BTW the laws pertaining to Real Estate in CA are completely different than Louisiana. Just because you may have bought and/or sold a home in both states does not make you an expert as Realtors are in such matters.
I know that the laws are different but in either case or for that matter in any state it is not that difficult to follow up on the stuff that I mentioned and to learn them if the alternative is to for out a percentage of the house.
Let me iterate - I would willingly let an agent do all this work for me Just like I hire a lawyer, plumber, tiler etc... but at a FIXED PRICE
- we can negotiate on the fixed price based on various factors like the cost/time of staging, areas of exposure of the sale, legal areas covered, follow up on the repairs done to the house (if necessary)
- but sure as hell I am going to pay based on time and effort and not on percentages of the total sale.
Posted on 1/24/10 at 8:49 am to LSUGUMBO
quote:
I'd say under $150-175, you can probably sell it yourself with some success, but over $175K, most people are going to have realtors.
Sold mine FSBO two years ago at over twice that. Market was a bit better. Bear in mind that a good realtor can help in a down market, though I think the <$200K houses are still moving in BR.
When a realtor brings you a customer when you are FSBO, you will have to negotiate a fee. We paid 1% as a "finders fee", although they weren't happy (wanted 2%). Knew the people really needed a house, and wanted ours, so we had some leverage.
Posted on 1/24/10 at 9:46 am to SloMeaux
I put my up for sale with a realtor, I think it was a 6 month contract. After 6 months we had lots of lookers but no buyers. When the 6 months was up I reduced the price the exact amount of the realtor's fee. It sold in 1 day.
Posted on 1/24/10 at 2:13 pm to Zach
There is a huge difference between a "realtor" and someone that can "sell" real estate. I am not a realtor, and have tried it both ways. In an up market it is easy, but when things are very competitive you need some one that can convience a potential buyer they can't live without your house, walk them through getting financing and close the deal.
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