10 Things For Sale by Owner Companies Don't Want You to Know!
1. They charge upfront...Agents don’t.
When it comes down to it, listing with an agent shouldn’t cost you a cent. I know you probably read that a few times. Agents don’t charge upfront, we only chargewhen results are provided. This gives you an advantage in more than one way. On the other hand I have heard of individuals paying upwards of $2,000 upfront just for a sign and a spot on a website, as well as some personal advertising, only to end up having their house listed and sold by an agent.
2. You'll save thousands in commissions.
This isn't necessarily true. A professionally marketed MLS listing will often bring up to 5% more in sales price than a For Sale by Owner. The simple reason is serious buyers work with agents and view the homes on MLS. For Sale by Owners attract bargain hunters who quite often will lowball their price to get a "deal."
Even if you are selling on your own, nearly 90% of For Sale by Owner listings sell with a Realtor bringing the buyer.
You'll most likely pay that agent 2% for helping you sell your home. Now imagine if you've already spent an additional $2000 on personal advertising, and don't forget the time, hassle, awkwardness of negative comments and potential security risks...what does that add up to for you? In the end you WILL make more money in your pocket, with less hassles by using a professional.
3. They aren’t held to any code of ethics.
Real estate agents across Canada are held to a strict code of ethics by CREA. They take the liability if something goes wrong. They are also held to higher standards in advertising and they have duties to you as a client.
4. Just because you’re a real estate professional does not mean you’re rich or overpaid.
This has been the fuel for many slanderous ad campaigns released by popular for sale by owner websites over the years. The truth of the matter is, if it was that easy and they got paid a “small fortune” to sell a house, everyone would get into the business. Selling homes is hard work. Agents often find themselves working for free and hoping to receive a commission. Consider this situation: A buyer has his agent show him 30 houses over the course a month. The agent spends hours of his time to assist the buyer. The buyer decides not to buy. The agent has worked for free and lost money on expenses. This is a common situation.
5. They can’t put your home on the MLS system.
This system was built by Realtors for Realtors. No one is allowed to list a property on it unless they have a license to trade in real estate. These websites will just refer you to an agent (how ironic), often one from the other side of the country, to put your home on the MLS and nothing else. In most cases the listing won’t even be on your local MLS board, making it sometimes hard to find.
6. They actually petition agents to sell their houses.
After years of bashing the profession, certain for sale by owner websites are now calling on agents to come to their rescue, so they can take credit for selling homes. Tell me another business model where you ask your competition to do the work for you. This is really an admission of one thing – serious buyers go to an agent. Why? Because it will cost you nothing to buy through an agent.
7. They don’t have a real estate license.
This is something a lot of people do not realize. These so called “private sale” websites are just that. They are not licensed to trade in real estate or to give you real estate advice. They can’t even advise you on how to price your property because doing this would fall under an agency relationship and would be considered trading in real estate. That requires a license. These parameters are set in place to protect you, the consumer.
8. You pay them so you can do all the work.
Since these companies are not licensed to trade in real estate they are not permitted to represent you in a real estate transaction. This means they can’t answer buyer inquiries for you, show your home, host open houses, handle paper work, mediate negotiations, advise you on market conditions…and the list goes on and on.
9. Privates sales carry a stigma and uncertainties that make buyers uncomfortable.
Ever gone to view a private sale as a buyer? Then you know it can be extremely uncomfortable and limiting to view someone’s house with them in it.
It can be even more uncomfortable to negotiate with them. On top of all this, private sales beg the question, why didn’t they use an agent? Is there something wrong with the house? If they are trying to cut costs now, did they cut costs/corners with repairs?
10. Agents don’t hate for sale by owners.
These companies would have you believe that agents think FSBOs are ignorant. This isn’t the case. We get why you would want to go this route. It can be done, but just because you can do something doesn’t mean you should. Like many DIY projects you are putting yourself at risk. In this case you are taking a risk with the biggest investment of your life.
It will not be an easy process. In the end, in today’s buyers’ markets you need an agent who will work tirelessly for you to get your home noticed above the thousands of others on the market. Just remember that limited service will always equal limited results and if it seems too good to be true, it is more times than not.
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