Why FSBOs Make Less Money
It shouldn’t make sense right? If you aren’t paying a commission to your agent and the buyer’s, why aren’t you putting more money in your pocket?
For Sale By Owner’s make on average, 27% more when working with an agent. Less than 10% of all FSBO’s actually wind up selling their house on their own. But why?
I have conversations with home owner’s looking to privately sell every week. And yes, this is because I call them looking for their business. I share the same stats I shared with you, and then I try to provide them value. The market is a bit different than it was 90 days ago, and it’s no longer a simple seller’s market.
Every home you see in Zillow is pulled from MLS. They have an additional section listed “For Sale By Owner”. The homes are viewable to everyone, but they aren’t showing your privately listed home as frequently as the others. Zillow is a business AND a broker. They’re looking to sell leads to other agents and if they aren’t sharing the listing agent’s information before a random “local” agent, do you think they’re showing your privately listed home to anyone? Spoiler. They’re not.
You know what else matters on Zillow? Days on market. If I had a dollar for every buyer that said “What’s wrong with this house? It’s been on the market for 11 days?” the past two years, you’d be sick to your stomach. Eleven days on the market is nothing compared to 197. People want to see the newest listings first, and every algorithm supports that.
Most buyers are represented by an agent and that will come at a price. Would you negotiate your lawyer’s fee? Your doctor’s? Probably not. If you want to be successful in selling your home, you need to be prepared to pay the buyer’s agent at least. Otherwise, why would they show their buyers your home? There’s now plenty of options on the MLS.
This leaves homeowners negotiating against a professional on their own. The buyer agent’s fiduciary duty is on behalf of the buyer. Homeowners aren’t prepared to negotiate on their own behalf when an appraisal comes in low. Or an inspector finds termite damage. Or the buyer decides they want to walk 3 days before closing. These are the moments that private sellers lose money.
The sale doesn’t end once you’re under contract. Each transaction is nuanced and having a professional on your side is imperative for making top-dollar on your home.