A Guide to Selling a Property on your own.

First, thank you for taking the time to read this guide. When you want to sell your property by yourself, without taking services of a real estate agent, such a property sale is termed as a 'For Sale by Owner' or FSBO property. Though FSBO has advantages to it, the greatest being a saved commission and control, you should also be aware of the many drawbacks that it can entail. This is applicable for both the sellers and the buyers. This presentation is going to show both sides and let you the FSBO decide if choosing a real estate professional is right for you at this time or if selling your property on your own is.

Advantages as a Seller So what about the benefits of a For Sale by Owner listing? First of all, you make all the decisions, and you take in all the profits from the sale of your home. You also get to set the schedule for home viewings and negotiations. You personally meet and interview all potential buyers to determine if they’re qualified, serious candidates. When it comes time to negotiate, it will be between you and the buyer. No agent to agent banter while you sit out of the loop, wondering what will be accepted.

1. Potential to Save Money There is no Brokerage Fee (commission) to be paid. You receive all of the proceeds (less marketing costs). This is, of course, the biggest benefit of selling your own house. 2. Decisions You are in total control of the transaction. If mistakes are made, they are your own. There is no one else to make mistakes "for" you. 3. Flexibility You are always available at the home for showings, answering inquiries, etc. 4. Knowledge The seller can supply more information about the house and the neighborhood. Since the home owner has actually lived on the property, he or she has more intimate knowledge of the house and the surrounding community. The seller can offer detailed information regarding the benefits of the house for sale as well as any repairs or improvements that would need to be made. The home owner can also describe what the neighbors are like as well as the general character of the surrounding community

Advantages as a Buyer 1. Savings Saved commissions on brokerage fees are often passed over to the buyer. Most buyers expect this and it is one of the reasons they choose FSBO. 2. The buyer has more bargaining power. Many home owners may lack negotiating experience and expertise, and in their eagerness to unload themselves of their properties, they can settle on a bid that is significantly lower then a realtor would have allowed. For sale by owner properties typically receive initial offers of about 10% lower than the asking value. 3. The buyer has more bargaining flexibility. Without the involvement of a real estate agent a buyer has the freedom to get more creative with an offer. This includes any nonfiscal offers such as bartering (with services or supplies) and house swapping (a transaction where two parties exchange properties). 4. The seller is bound by law to disclose important information regarding the property. A buyer may be wary that a home owner would try to avoid mentioning any significant defects to the property. But the buyer should be aware that home owners are required by law to disclose any information that would affect either the buyer's decision to purchase the property or the property's value, such as needed repairs, a death in the house, all forms of pollution, and zoning.

Disadvantages as a Seller You face an uphill task to sell your property on your own. You need to work a lot to make it possible - research, pricing your home, placing ads, screening applicants (qualified buyers), conducting open houses, showing the property and so on. Provided is a list of some of the difficulties many FSBO face. 1. Negotiating the Sale Price: The first major disadvantage in the FSBO market, for a home seller, involves the negotiating of the sale price. Statistics reveal that real estate commonly sells for approximately 16 percent more when sold through a realtor. The home seller may not prove more profitable when selling as an FSBO. Using a realtor will require the home seller to pay a six percent realtor fee, but a 16 percent average sales price difference far outweighs the disadvantages of paying a 6% realtor fee. Many buyers believe that if you are selling on your own and not paying a commission, it is they (the buyers) who should get the saving--not you. 2. Emotional attachment: Most home owners have an emotional attachment with their property and value every small detail about it. This has perils of its own 1. Homeowners tend to over-price their property. Remember a properties value is determined by the market and not the memories. 2. Homeowners tend to describe every minute detail of a property which could possibly irritate prospective buyers. Homeowners often find it difficult to market their property as a product. This can be a weakness or disadvantage during showings and negotiations. If a buyer tells a Realtor that the paint (carpet, picture, smell, furniture) in the living room is awful it is not an insult to him as it may be to a FSBO. 3. Time consuming:

Buyers: Buyers can be time consuming. It may take months for a Realtor to match the right buyer with the right property. A Realtors advantage is that we have many buyers, contacts with other realtors, professionals in our field and industry specific technology. We also have experience and a team of professionals to back us up. We may not know how to answer every question, but we know how to find answers quickly (usually with one phone call.) When a seller chooses to be an FSBO they have to ask themselves some important questions. Here are few: Are you available for your buyers when they call or want a showing? Voicemail and answering machines don't work. In our fast paced society if a buyer doesn't get an immediate response he moves on to the next property. Is your buyer qualified or just a "tire kicker." An agent works with qualified buyers. Many buyers believe that the FSBO are willing to provide financing for them, are you prepared to hold a note? Have you had an open house? Did you market it or was it just a sign from Home Depot? Did you know Realtors have "Broker" open houses monthly that provide tours of all new properties to Realtors in an effort to market the listing? During these tours we conduct questioners and evaluations from other Realtors to help market a property. Research: A lot of information is available to you at the click of a button through the internet. Do you have the time to go through the huge web and also get utterly confused with the enormity of should I try this or will this help me sell my home? This research is work. The task of choosing where to place ads, how to place them, what to write and so on takes a lot of time. Investing that much time is difficult. A Realtor has done this hundreds of times and already knows what works. If you want to give maximum benefit to your efforts of selling your home, your free time will be somewhat or severely limited. 4. Limited exposure:

FSBO property is available for offer to a limited set of buyers unless you decide to list in the Multiple Listing Service which also has a fee attached to it. When you take the help of a professional, your property will benefit with more marketing exposure and technical inputs that a real estate agent brings to the table.

Without full technical details it is very likely that the owner does not have a fair knowledge of the true market value of their property and more often than not, tends to over price his property. An overpriced property fails to attract the buyers and as time passes the value starts diminishing. If you avail the services of a real estate broker, your property gets more showings and a greater exposure than if you sell it by yourself. Research indicates that only 2% of FSBO sell. 5. Higher costs: FSBO feel that by selling their property on their own they can cut down on the costs the real estate broker would take and save money. Actually many end up spending more. Advertisement costs are huge and free advertisements get so cluttered no one reads them anymore. Many real estate brokers include the costs in their services; you get it as a package. Don't forget the costs you incur running around for placing ads, opening bank accounts, dealing with wasted time on spam, doing research and so on. Above all, is the cost of losing your peace of mind over the sale. All marketing and advertising costs are your own, which can be an expensive, stressful and a time consuming proposition. 6. Legal Disclosures: Wading through the muck of legalese in the deeds and contracts, and getting the right technical specifications requires a great deal of training, networking and practice in order to get right. Novices pretending to know all these aspects could either find themselves on the short end of the stick or having some serious troubles with fraud and legal loopholes. Not disclosing necessary information or not using the correct form could leave you open to legal action from a buyer. Be aware of equal housing laws. 7. Competition: The competition in the real estate market is tough. This is why it is difficult to sell a property today. There are a lot of sellers in the market while the number of buyers is very limited. In order to compete in the market, sellers are lowering their prices. Those who do not know how to present their property and market it well, end up in losses. Moreover, if you are competing with experienced real estate agents, your chances are very slim. Everyone loves to compete, but when your competition has too much of an advantage it becomes frustrating. 8. Buyers have an advantage working with a Realtor:

Buyers choose Realtors for many reasons: home searching, scheduling inspections, appraisals and closings, negotiation for lowest price, handling mortgage questions and concerns, pointing out market concerns and benefits for the specific area, consult on "future salability" to achieve desired goal and many other services. Buyer's receive a Realtor's service for "FREE." 9. No Agent Showings The obvious fact that should not be overlooked, is that the quickest way to the sale of your property is to have lots of showings. When you list with a real estate broker that has a lot of "action" in its office, you can flat out count on more showings. By action, we mean a brokerage that carries lots of listed properties in inventory, and a large advertising budget directed towards the exposure of its listings. An effective real estate broker promotes showings of its listings through internal promotion and motivation of its agents.

Disadvantages as a Buyer You are attracted to an FSBO as in this case you are not required to pay the real estate's commission. Here is a look at problem issues that you need to be aware of: 1. Unsure of the ownership: As a potential FSBO buyer, you are not sure about the ownership of the property. The person who has put up the house for sale might only partially own the house and the other owner might not actually be interested in selling it. 2. Unsure of the price: As FSBO houses are generally over-priced and there is no agent involved, you don't know the market (buyer) and hence you are unaware of the ideal price of the property to help you bargain well.

3. Unaware of the faults: As the owner is putting his house for sale and values every little bit of it, he/she will not come out with the faults to the prospective buyer. This creates a difficulty as the latter is deprived of the right to know all the aspects before deciding to buy. 4. Unaware of technical details: The owner of an FSBO home isn't always aware of the exact measurements - the total area, the carpet area, dimensions of each room, section etc. Hence, he/she will not be able to provide you with details on the same. 5. Advice and help: A real estate owner's job is facilitating the buying and selling of homes. He comes up with his expert advice from time to time which an FSBO home owner cannot provide. He can think about the property neutrally, without any bias and hence you can value the same. Also, a broker helps the buyer throughout the entire process including interpreting the agreement, handling registration details etc.

Conclusion: Once again thanks for taking the time to read this presentation. As a business owner on the Wildwood Boardwalk for 16 years I understand that certain situations call for me to take action and not hire a professional. I have benefited from this as well as made things worse. Most of these situations, without going into detail, involved me trying to save money, which once again, sometimes works and sometimes does not. I have done my best at presenting both sides of the argument and the decision has always been yours. I only ask that if you do decide to go with a real estate professional please take the time to read through

the Weichert Coastal Sellers Guide or watch the 12 minute DVD that I have prepared that overviews the selling process. If you wish to have a meeting and have me present any of this information please feel free to call me or email me at any time with the contact information below. Thank You and Good Luck with your ventures! Christopher Pohle.

Representing Your Best Interests in Real Estate.....

Christopher Pohle Sales Associate Cell:609.231.0303 [email protected] downtheshorerealtor.com Facebook: Down the shore realtor, Lime Ricky and Lime Ricky World