Real Estate Practices
By Owner
For Sale By Owner (FSBO)
The vast majority of home sellers in today's market rely on the expertise of a real estate professional to assist them when they sell their home, and there's been a declining trend in the percentage of people selling on their own.
Sellers make more money when they use a real estate professional.
The median FSBO (for-sale-by-owner) selling price in 2003 was 20 percent less than the median agent-assisted transaction price. Although the agent-assisted price is skewed a little high because it includes a greater mix of more expensive properties, the data demonstrates that sellers make more money by using a professional.
The level of home owners selling without a real estate agent has declined.
In 1997, 18 percent of owners sold their home without a real estate professional, according to The 2003 NATIONAL ASSOCIATION OF REALTORS® Profile of Homebuyers and Sellers. In the first quarter 2003, it was only 14 percent. The trend is clear.
Many people who bought directly from sellers knew them in advance of the transaction. Only 5 percent of buyers in 2003 purchased directly from owners they didn't know in advance of the transaction, down from 11 percent in 2001.
Several factors appear to account for the decline in for-sale-by-owners: the increasing complexity of the transaction process, with more disclosures and legal requirement than ever before; the amount of time required to market and show a property; and security concerns about the motivation of strangers dealing directly with owners and walking through their homes.
Since FSBOs don't use a real estate professional, they have to do their own marketing to attract potential buyers.
Real estate professionals are experts in marketing who can sell a home for more money in less time.
The biggest problem areas for FSBOs are in understanding and completing paperwork, preparing a home for sale, getting the right price, and time for all aspects of the sales process.
Real estate professionals assist both sellers and buyers with a variety of the details surrounding a real estate transaction. Real estate pros can help a home seller set a realistic price for the property and ensure the proper paperwork and various inspections are handled correctly.
In addition, real estate professionals are experts in marketing properties to attract qualified buyers. A broker or sales associate also can show a home more objectively than can a seller who is emotionally attached to the home and who might become unnerved by prospective buyers' critical comments.
The real estate pro also checks the financial capability and bona fides of buyers before allowing them onto a seller's property.
Source: National Association of REALTORS®Field Guide to Working With FSBOs
On this page you'll find dozens of articles, books, videos, studies, statistics and Web sites to help you find out who For Sale By Owners are and how to work with them.
Why Use a REALTOR®?
Not every agent or broker is a REALTOR®!
Here are the advantages of working with a REALTOR® when buying or selling your home or property.
The decision to buy or sell a home or property is one of the most important ones you can make. A REALTOR® has the interest, resources, and dedication to guide you through the process.
A member of the National Association of REALTORS® (NAR), the Illinois Association of REALTORS® (IAR), and his or her local REALTOR® Association, a REALTOR® abides by the NAR Code of Ethics -- a standard of professional behavior that exceeds requirements for state licensing.
Only a REALTOR® can display the REALTOR® logo which is a federally registered mark licensed exclusively to the members of the National Association of REALTORS®. This mark represents a high standard of professional conduct in serving the interests of clients and customers.
Purchasing a Home or Property
When purchasing a home or property, a REALTOR® can help you determine what you can afford and shows you only those properties that meet your criteria. A REALTOR® can explain alternative mortgage financing programs. In addition to knowing the local money market, a REALTOR® can tell you what personal and financial data to bring with you when applying for a loan. Already familiar with current real estate values, real estate taxes, utility costs, municipal services and facilities, a REALTOR® may also be able to respond to your questions about local zoning changes that could affect your decision to buy.
A REALTOR® can research your housing needs in advance through a Multiple Listing Service even if you are locating to another city.
A REALTOR® can provide you with a checklist to serve as a reminder of some things you should look for in order to make a wise buying decision.
Selling a Home or Property
A REALTOR® can free a seller from the time, effort and details involving the sale of the property. They can establish the fair market value and can advise when seller financing might be in your best interest. With an interest in bringing both buyer and seller together, a REALTOR® can help negotiate a satisfactory agreement between the parties. Before the first showing and beyond the final sale, you'll get the expertise and service you look for in a real estate professional who knows how to sell your home or property.
A REALTOR® does a lot of homework in order to sell your home or property. The property is listed, ads are placed, inquiries are handled and appointments for showing are arranged with your convenience and best interest in mind. With the aid of a Multiple Listing Service a REALTOR® can list a home or property and work with other REALTORS® to assure a wider range of prospective buyers.
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Illinois Association of REALTORS®
