Disappointed in FSBO advice
Letter to the EditorBy Inman News, Wednesday, July 6, 2011.
Re: 'What to know when buying FSBO' (June 30)
I am very disappointed in the advice that you provide to readers in the piece titled "What to know when buying FSBO."
As an attorney and real estate agent, I realize that (the writer, Tara-Nicholle Nelson, has) additional insight. However, I find your article may be influenced by the fact that (she has worked as a) real estate agent.
First, if the for-sale-by-owner home is priced outside the market or (the owner is) unwilling to negotiate, then don't make an offer.
Second, the buyer is the party that submits the offer and the terms of the offer (usually on a preprinted contract form approved by the state board of Realtors). Therefore, requesting the seller pay the buyer's attorney fees is likely to make a seller reject the offer because the buyer is the party setting the terms of the contract.
Third, you do make a good point about the seller providing accurate disclosures, but that can be resolved by having the FSBO seller perform a home inspection before placing the home on the market, and following the golden rule of selling a home: DISCLOSE EVERYTHING.
A buyer of a FSBO should request a copy of the home inspection the seller performed within 48 hours of an accepted offer to determine if the sale should go forward. The buyer should pay to have (another) inspection performed.
Lastly, one positive that you did not mention in a FSBO transaction is that there is one less person involved in the relaying of messages, which can speed up a transaction and decrease the muffling of messages.
This piece seems skewed to make the reader think they should never consider doing a real estate transaction without an agent.
The writer states that a buyer should ask for a discount on fair market value if the seller isn't using a Realtor. I'm sorry, but fair market value is fair market value, regardless of who is listing the house.
Commissions are built into the listing price or selling price negotiated by a Realtor, which inflates market values. But, the FSBO seller can't be expected to adjust pricing based on this model. If I'm going to do my own work, why shouldn't I reap the benefits of the Realtor-commission-adjusted "market value"?
To say that the involvement of the Realtor somehow makes the transaction more valuable is nonsense. However, I do concede I may be willing and more able to sell below the commission-adjusted "market value."
Furthermore, most for-sale-by-owner sellers will hire attorneys and title companies to handle the contracts and paperwork (both of which would also be utilized by a Realtor), which is the bulk of the complexity involved in selling a home.
Realtors have no special access to any tools, forms or resources needed to complete a real estate transaction outside of that to which a homeowner has access.
Using a Realtor, in my opinion, is a convenience -- not a necessity. Most private owners are more than capable of selling a home themselves provided they're willing to do the legwork and research involved.
It seems this is an article written from the point of view of someone in "the industry" who thinks there is only one right way to complete a real estate transaction. At no time in the article does she mention, without using negative language, any of the pros (as asked in the reader's question) of selling a home yourself or buying from an owner.
Selling a home yourself or buying a FSBO home without agents involved can save both parties a great deal of money, period. Consider a home that sells for $100,000. There can be $7,500 worth of commissions combined on the sale. If you add in closing costs to the transaction, the $100,000 sale can cost both parties as much as $10,000 to $12,000 combined.
Selling your home yourself and buying without an agent can easily cut these costs in half or more.
I liken this to doing your own home improvements: a bit of elbow grease goes a long way. But, as with do-it-yourself projects, if you are not comfortable with or unwilling to learn the process, then by all means hire a professional.
Mayfield Heights, Ohio
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