Disadvantages of ‘For Sale By Owner’
For Sale by Owner’ or FSBO property is one in which the property owner does not take the help of a real estate agency to complete the sales. Instead the sale is conducted by the owner himself.
Drawbacks for the Seller
If you are someone considering an FSBO property sale for your property or you want to buy property that has been advertised as an FSBO sale, you should be aware of the drawback concerned with this form of property sale. Let’s take a look at what these are from both the seller point of view.
1. Cumbersome Selling Process: The process of buying property through an FSBO Sale is cumbersome. You may enjoy the benefit of not having to incur real estate broke expenses, still you have to do everything needed to sell the property. You need to do the research work in fixing the right price, conducting open houses, screening applicants, showing property to interested people. This is a considerable loan of work.
2. Sentimental Feeling Come in the Way: Your emotional attachments to the property can make you do mistake like over pricing the property, or description of even minute property details, which can irritate the prospective buyer. You may not show the kind of professional marketing touch that buyers like to see when they come to check a property on sale.
3. Lack of knowledge: As an owner, you will not have the kind of knowledge about the real estate market, legal matters and finances, as a real estate agent has and this can be a disadvantage for you when you decide to sell you house. Not knowing about legal and financial issues associated with the property purchase can cause problem during time of sale.
4. Need to spend time: When you decide to sell your home by yourself, you have to spend time top place ads, get you property ready for an open house, get the sales agreement ready, and look into necessary paperwork and so on.
5. More Costs: Unless you know quite a bit about the real estate market and all the things required completing a real estate transaction, if you are not careful you could land up spending more than you intended to do. This goes against the very idea of having an FBSO, which is to cut down expenses to the real estate agent.
Drawbacks for the Buyer
Most people opt to buy property through FSBO because they don’t have to pay real estate agent services in such a purchase. Let’s take a look at the drawbacks in buying property through this form of a sale:
Unsure of the ownership: Though the property has been put out as an FSBO, you are not sure of the true ownership of the property. This is because you are going to believe what is stated in the ad, at face value. If you don’t do your own research into the people putting property for sale, you might come across someone who is a partial hose owner and trying to sell property, while the other owner is really not interested in the same.
Unsure of the price: Since there is no agent involved, you can find FSBO properties to be over-priced as well. If you do not find out about real estate market prices in that area in general, you can land yourself in a deal where you pay more than necessary for the property.
Unaware of the faults: You will not get to know about the real condition of the property. The owner is obviously not gong to tell you and if you won’t get a home inspection done, you can move in and fin a lot needing in terms of repairs and modification, which will increase your expenses.
No expert advice: When you hire a real estate agent, you can be sure of getting expert advice. You can have the owner’s background and property background check through them, but you don’t have such privileges here. Lots of paperwork is also done by then, which once again you have to do by yourself here.
