Fact Check Friday - For Sale By Owner Listings and Why You’re Probably Not Saving Money
Probably one of the most common misconceptions in today’s market is the notion that For Sale By Owner listings or FSBOs will provide the seller with a greater net return. On the surface, it seems rational. Today’s real estate market is the most favorable seller’s market sellers may ever see in their lifetime. However, despite all the favorable conditions (interest rates, low inventory, etc) the research from the National Association of Realtors 2020 Profile of Home Buyers and Sellers clearly demonstrates that utilizing the services of a Realtor® provides a far greater overall sales price.
Copyright ©2020 “Profile of Home Buyers and Sellers.”
NATIONAL ASSOCIATION OF REALTORS®.
All rights reserved. Reprinted with permission. June 21, 2021, https://www.nar.realtor/reports/highlights-from-the-profile-of-home-buyers-and-sellers.
According to these statistics, even in a best-case scenario (FSBO seller does not know buyer), the average sales price is $40,000 less than the average of agent-assisted sales. If an agent negotiates a full 3% for both the listing and selling agent (6% total) on a $295,000 sale, the seller would pay is $17,700. Even in cases where the FSBO does not know the buyer, the seller would still theoretically leave $22,300 on the table. Not to mention, they would have to work very hard as their own agent.
For more information on FSBO listings, check out the latest Level Up with GNO Realty Podcast! Some samples from Episode 5 are below.