The Pitfalls of FSBO or "Fizzbo"
 (pronounced: "Fizz-Bow"). 

In today's Hendersonville NC Real Estate market, it seems like more and more sellers are starting the process of selling their home on their own without the use or expense of a professional REALTOR® or other licensed real estate agent. This type of seller is referred to as a ‘For Sale By Owner' as their Home Depot signs proudly proclaim. For short, the real estate industry refers to these sellers and their properties by the slang pronunciation of their FSBO initials, or ‘fizzbo'

Although it is impossible to put an exact number on the FSBO count in Hemet or any other real estate market at any given time, we can certainly project that approximately 10% of all homes being offered in the resale market are FSBO's. Of these a good portion will actually be sold to friends and family members of the seller, negating the need for professional representation.

There are those independent self help individuals who believe they have what it takes to go this route on their own. Often they weigh the advantages against the disadvantages and decide they can do it themselves and save a lot of money.

I would like to share some of the possible pitfalls with the prospective FSBO seller so that if they are contemplating such an activity that they have the opportunity to weigh in on all of the potential pitfalls. This article in no way is meant to suggest that every FSBO listing will encounter every one of these negative experiences or that this is anal conclusive list of every possible negative experience that the FSBO should be prepared to expect. Like so many of my articles, I am only attempting to stimulate the readers thought process so they can make the best decision for them considering as many factors as possible.

DETERMINE THE CORRECT ASKING PRICE

It really is difficult to know the current market conditions for each neighborhood in a community without actively participating in the industry and monitoring the many factors that determine what price a home should be listed for.

For this reason, the FSBO should solicit the expert opinion of at least 3 qualified REALTORS® who do business in the FSBO's neighborhood. Do yourself a favor and DO NOT look for a REALTOR® from outside of your market area. Remember, all Real Estate is local and your agent should be too. 

If the FSBO seller is straight with the agents, they should not have a problem offering you their opinion, because they know that most FSBO sellers end up frustrated with the process and will ultimately hire a REALTOR® to do the job they started and they are expecting you to choose one of the agents you have already interviewed.

Each REALTOR® should prepare a "Comparative Market Analysis", or CMA. Here they will analyze other properties and compare them to the FSBO property. The properties looked at will be the most like the FSBO property. If at all possible, they will be a model match from the same block - obviously this is in a perfect world. So adjustments will be made for square footage, lot size, room count/use, amenities, condition, location and anything else that may be relevant.

The CMA will look at and compare the FSBO property against homes that are currently on the market, or ACTIVE listings. These are the properties that the FSBO will be competing directly with.

Many of the ACTIVE prices are inflated - I will often refer to them as the sellers ‘fantasy' price. The CMA will also look very hard at the homes that have recently SOLD, that are the most similar to the FSBO. The sold comps will allow the FSBO seller to see what the market will bear. Realize though that a real ‘trend' takes a solid 6 months to reveal it self.

A thorough CMA will also look at listings that have recently EXPIRED from the market as well as those that are currently in escrow - these are known as PENDING. The EXPIRED listings expired for one reason and one reason only - price. Every property has a price it will sell or today and the expired sellers were not willing to sell at that price.

The reason a FSBO seller should interview 3 agents is to determine the actual value of the FSBO home for sale in Hemet, California is because agents may use the CMA process to further their own agenda.

MARKET YOUR HOME FOR SALE

With home computers, inexpensive desk-top publishing software and the Internet available to the FSBO seller today, marketing may seem like a simple task. 

Certainly many of the tools are readily available today.

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