For Sale By Owner Challenges

While home owners may initially attempt to sell their home without benefit of the representation of a broker or agent, some 90% of these For Sale By Owner or FSBOs ultimately end up signing with a realtor.  Why? The process of selling a home these days is much more complex than many homeowners realize. And, while the prospect of saving on a realtor’s commission may sound enticing, data shows that an agent can typically net a higher price and profits.  Here are some of the common challenges facing FSBOs:

Getting an Optimal Sale Price

Ironically, the reason home owners typically attempt to sell their home themselves is to save on commissions, yet data from the NAB shows that a typical FSBO home sells for $65K less than the price the homeowner would have netted from using an agent. Research suggests that the discrepancy stems from lack of market analysis that leads to underpricing the property.  Agents can rely on their experience as well as a plethora of tools to determine market price and value to arrive at the most accurate number.

Selling the Home Within Your timeframe

If you’re in a hurry to sell your home, the best way to do that is through professional representation. Yard signs and a personal network can’t compare to the tools a realtor has at his/her disposal including professional photography, copywriting, social media, digital outreach as well as the listing service that opens up the property to other agents, creating demand and expanding exposure to your home. Moreover, most FSBO sellers have jobs and other time commitments, especially if they’re getting ready to move to another location and/or take on a new job.  Selling a house is a full-time occupation best left to those agents that do it every day.


These days, most home sales end up with more than a standard sales contract.  Disclosures, contingencies, and last-minute repairs can all require additional paperwork and even legal review and can slow or even completely derail a sale.  Not properly disclosing something about your property can lead to additional costs down the line — homeowners don’t have the Errors and Omission insurance (E&O) realtors do so aren’t protected in the event a problem arises.

Investing in the Right Upgrades

Home owners don’t always know the current trends and what buyers are looking for in terms of designs and finishes.  Accordingly, FSBO sellers spend money on home improvements and customizations for which they can’t get a good return.  For example, while FSBOs may enjoy their pools, they rarely are able to recoup their original investment the way they might in upgrading a bathroom.

Overall Efficiency

Most FSBO sellers aren’t prepared for the time and cycles it can take in preparing a home for market, including coordinating the staging and showings as well as all of the paperwork and back and forth required to formally close the transaction.  Keeping the house “buyer ready” and finding a place to go when you want to hold showings are just a few of the challenges that a realtor can make easier for you.

Selling a home is a complicated and frequently emotional process to navigate. The belief that a FSBO sale can help save money, coupled with a lack of marketing and poor market analysis, can waste a lot of time and money leading to frustration and higher carrying costs in the end.