Once you have decided to sell your Northern New Jersey home, one of your first action items is to recruit a top sales team. About 90% of sellers choose a licensed Realtor® to head up their effort—not just because it’s the popular thing to do, but because the alternatives are few. You could recruit a business person from some other discipline, but few do that. Most in the minority group decide to do it all themselves—to go the FSBO route: “For Sale By Owner.”
The reason for settling on this choice is usually a dollars and cents one: to eliminate the real estate commissions. Any home sale in Ringwood, Wanaque, Pompton Lakes and Wayne is a weighty transaction—so pocketing that percentage looks like a businesslike decision. It usually does have financial ramifications, but not necessarily the kind that the Ringwood, Wanaque, Pompton Lakes and Wayne FSBO seller was hoping for:
1.Sta
tistics tell us that fewer than 3% of home buyers hear about their ultimate purchase directly from the seller. Missing out on 97% of prospective buyers greatly diminishes the chance that more than one party will compete to buy the property.
2.The longer a property lingers on the market, the lower its ultimate selling price is likely to be. Interviews confirm that only 1 in 8 FSBO sellers succeed in selling within their planned length of time…
3.…and even fewer “get what they consider the right price.”
4.Advertising expenses have to be paid by the seller. There is $5.95 for a front yard FSBO sign, plus $2.35 for the wooden stake that holds the sign up. If no additional advertising expenses are incurred, it means there is no advertising—with likely outcomes described in 1, 2, and 3.
5.If the FSBO seller has regular job responsibilities, the time devoted to handling prospects and addressing the business and legal ramifications that accompany a residential real estate transaction can become costly distractions. High among the tasks past FSBO sellers rated most difficult was “understanding and performing the paperwork.”
6.The average price of a FSBO sale is 75% of one carried out by a professional.
7.Even if a sale is accomplished, the premium gain
ed may be less than anticipated. Since the buyer is likely to be represented by a buyer’s agent, the hoped-for savings are cut in half.
A financial result—the usual reason for most Northern New Jersey FSBOs—often comes to pass, but it’s the opposite of the one intended. You might say that the FSBO strategy should really only be attempted by those for whom money is no object. In effect, FSBOs are the champagne of real estate strategies…
I’m only half kidding about that last—but not kidding at all when I suggest that you give me a call when it’s time to sell your own Ringwood, Wanaque, Pompton Lakes and Wayne property!