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THE FSBO FOLLY - TO DREAM THE IMPROBABLE DREAM
By Joe Klock, Sr., CRB, CRS
Whether it's piddling away money on the lottery or chasing rainbows in the latest revival of pyramid clubs, the American public seems ever-willing to pursue the something-for-almost-nothing dream.
Home sellers are no exception. A small, but noteworthy, number of them continue to opt for the "FSBO" (for sale by owner) route in marketing their homes.
Basic question: Can a home be sold without the help of a competent, full-service Realtor? Honest answer: Of course it can, but does it make economic sense to do it that way?
Seldom, indeed - and I saw no hard evidence to the contrary during more than 50 years in the residential brokerage field.
Before you dismiss my opinion as merely the self-serving view of an industry loyalist, please read on; if you're ever going to sell a home, you'll be glad you did.
I'm (safely) assuming that, as a seller, you will be interested in realizing the highest price obtainable. (If the proceeds don't matter, any old marketing plan will do, including an absolute auction or accepting the first cash offer of a speculator.)
Realizing that the highest obtainable price is possible only - repeat, only - if you can expose the property to the best market, in terms of size and quality, and if you have the proficiency to identify, satisfy and obtain a commitment from the best-qualified buyer.
Let's first examine quantity. Unless your home comes to the attention of the largest possible pool of potential buyers, you can't be even marginally sure that the best offer you received represents the best price obtainable.
Consider the facts: Although a Realtor may spend thousands of dollars each month on advertising and may have hundreds of yard signs dotting the landscape, only about 20 percent of actual buyers will be attracted by these media.
So much for doing it yourself: How many of that 20 percent will be attracted by your single yard sign and occasional ad?
So much, too, for the fringe marketers who will sell you a sign, help you write ads and tell you how to generate a few prospects.
If you want to realize that "best price obtainable," you must challenge the whole market, not just a small slice of it..
How to reach the other 80 percent? That's where the quality of the market comes in.
In a full-service real estate firm, about 30 percent of its buyers are brought to the table by cooperating brokers.
It is axiomatic that the best-qualified buyers are availing themselves of the (usually) free services offered by real estate professionals. Why should they track down ads and signs when a competent practitioner will sift through the available inventory and match their dreams with reality?
The professionals who attract those best buyers play for pay - and the good ones are worth every one of the six figures in their incomes.
The only motive, then, that could possibly lure buyers to a for-sale-by-owner home would be the hope of saving the same commission that the FSBO is trying to save - a bit of logic that seems to escape many do-it-yourselfers.
Thus, both the optimum quantity and quality of your potential pool of buyers will be available only through the help of competent professionals, who also supply the third necessary ingredient - proficiency.
It takes skill, experience and objectivity to find, qualify, service and sell a prospective home buyer in an arena where dozens, if not hundreds, of homes, sellers and agents are vying for the same prospects.
It is naive to hope that rank amateurs or cut-rate counselors could effectively compete with full-time experts whose economic lives depend on delivering satisfactory service to buyers and sellers on a daily basis.
There's no law against being your own doctor or lawyer, or hiring a partially qualified person in either profession, but it is foolish to do so.
A bargain, either in goods or services, is measured not so much by what you pay as what you get in return.
In real estate, if you pay less, you settle for inferior marketing. If you settle for inferior marketing, the cost in net proceeds will far exceed the commission dollars you thought you were saving.
Only exposing your home to the best market, in terms of quantity and quality, coupled with proficient marketing services, can put that highest obtainable price in your pocket or purse.
Bottom line: One way or another, when a home is sold, someone ALWAYS pays a commission!
Joe Klock, Sr., CRB, CRS is a syndicated columnist and freelance writer in Key Largo, Florida. For more "Klockwork," visit www.joeklock.com.
The KlockWorks, Inc., 606 Island Drive, Key Largo, FL 33037-4808
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