FSBO

By Erik Hare

In Part 1 of “Confessions of a FSBO”, I told the story of how Cristy and I found ourselves in the position of selling a property before it had appreciated significantly in value.  We considered the possibility of selling it FSBO, and found that through a local minimal-service REALTOR this seemed to be a viable option, if not technically a FSBO.  So how did it turn out?

To start with, this is a difficult market for a small townhome.  As attractive as this house is, it’s still small and rather unusual.  Teresa has reported here how it is indeed a buyer’s market, especially for condos and townhomes, so we had our work cut out for us.  On July 17, it went up live.

The MLS listing that comes with   Buy Self Realty was, without a doubt, the most important source of interest, which we kept track of by counting showings.  In the first two months, there were 2 open houses and 22 showings, of which 12 came from REALTORs.  The minimal fee REALTOR was absolutely essential, as far as I am concerned.  There were an additional 5 showings that came from the Craig’s List offering, and another 5 that came from people who walked by and saw the sign.

That’s quite a lot of interest, especially in a tough market.  But it is an unusual property, and we had our share of the curious.  Sadly, though, it has not sold in the 3 months it has been listed, even with all of these showings. 

The Craig’s List offering had the most interesting side effect, however.  Even while it was listed as “for sale”, inquiries about short-term rental dominated the contacts we had.  The people who called or wrote were generally listed in short-term (6 months) or very-short-term (week by week) rentals, and were willing to pay reasonable prices for it.  Apparently, few apartments are available for less than a one year lease, which can be quite a burden for people.  In addition to that, business people on temporary assignments or couples waiting for their home to be built can find very little in the way of week-by-week housing. 

Once Labor Day came, we made a decision to take some of these renters up on the proposal.  And the house has now been occupied ever since, excepting one week, at a rate that just covers the mortgage and utilities.  The property is essentially “parked” until after winter, although it’s still listed and the sign is still up. 

Have we gone to Teresa on hands and knees, begging her for help?  Well, let’s just say that we’ve had a long conversation with her, and leave it at that. 

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By Erik Hare

Since this blog is read by REALTORs, and the general public,  I thought it might be enlightening to tell you a little bit about why someone might not want to have a professional representing them.  More importantly, I think that the conditions of the market might make this a bit more common in the coming years.   No matter what, I think professional should have a window into how people make the decision to go the hard road of being a FSBO.

In Part 1 of this two-part story, you’ll see why a person chooses to be a FSBO.

My partner in life, Cristy, recently moved in with me.  In a situation like this, one of us had to sell the real estate they have.   For us, the choice was Cristy’s smaller townhouse in Highland.  It’s a beautiful property, with a fireplace and hardwood floors.  But it is a bit small at 690 sq ft and just one bedroom.  In short, it’s a unique property that isn’t all that easy to market.

The only problem is the simple fact that Cristy didn’t intend to sell it after just two years of ownership.  That isn’t long enough to have an appreciable gain in equity, especially in this market.  The commission that a REALTOR would charge would put the whole sale at just a bit of a loss – something that just about anyone would like to avoid.

We all know that Teresa made it clear that you should not buy a property if you do not intend to hold it more than a few years for just this reason.  However, many people have been doing just that as a lot of amateurs went against this blog’s sage advice.  The problem that Cristy and I found ourselves in, unwittingly, is one that I think more and more people will be in over the next few years.

So what can you do?  Well, the best advice on how to be a FSBO comes from the Attorney General’s office, in their “Home Seller’s Handbook”.  There is a lot of advice as to what it takes to sell a home yourself, and is required reading for any potential FSBO.  For us, it came down to this advice on Page 5:

If you’re not under any time constraints, you might want to give selling your own home a shot. If you fail, you can always hire a real estate agent later.

Cristy had a natural bias against hiring a REALTOR, as her last home sale did not go quite as well as she had hoped.  The REALTOR she hired was not as aggressive as Cristy would have liked, and didn’t seem to really earn the commission she eventually got.  In addition to that, Cristy is the kind of person who takes out her frustration by learning more about the situation, and wound up very well versed in what happens in a real estate transaction.

The final straw, to her, was learning that a FSBO can get six month’s of access to MLS for as low as $399 through a licensed broker that provides a minimal service.   This also includes a nice sign for the yard – and requires you to return calls within 2 hours, 9-5 Mon-Sat!    In addition, a lot of property is listed in Craig’s List for free, which seemed like a reasonable addition to our own marketing. 

Personally, I still thought it was pretty unreasonable to sell it ourselves, but the proviso that we could always turn to Teresa later and beg for help convinced me to go along.  We were making our first compromises as a new couple!  So how did it turn out?

Check back on Wednesday, November 8, to find out what happened in Part 2.

More pictures and information on the townhouse