FSBO - For Sale by Owner
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Homeowners may employ the services of marketing or online listing companies, such as 4SBO.TV or market their own property but do not pay a commission and represent themselves with the help of a lawyer throughout the sale.
Interaction with Real Estate Agents
One of the most popular reasons why homeowners choose to sell their house without the assistance of an agent is to avoid paying an agent's commission. In the US the agent's fee typically makes up 6% of the selling price of the property.
When a homeowner decides to sell their home without a real estate agent and a buyer who is not working with an agent wants to buy the home, the seller pays no commission because no real estate agents are involved.
If a buyer who is represented by an agent is interested in a FSBO home, that buyer's agent may request the owner pay him or her a commission, or finder's fee, for bringing the buyer. The seller may choose to either pay the fee or refuse. The seller is not legally obligated to pay any commission. If the seller refuses to pay, it becomes the responsibility of the buyer to pay any real estate agent associated costs.
Canada
The Canadian Real Estate Association says 75-80 percent of homes in Canada are sold through brokers each year; the remaining 150,000 homes are sold without brokers.
A 2009 report by CTV Consumer Reports suggests that a quarter of all homes in Canada are now sold privately.
UK
In the UK, the average commission rate is significantly lower than in Canada or the US. Properties for sales by owner are less common.
USA
FSBO Madison based in Madison, Wisconsin claims to be the largest FSBO in the United States with a reported 25% share of Madison home sales.
According to a press release by the National Association of Realtors (NAR) regarding their 2005 annual survey of real estate consumers, 2005 Profile of Home Buyers and Sellers:
12% of 2006 US real estate transactions were FSBO. 13% of 2005 US real estate transactions took place via FSBO (down from 14% in 2004). The record percentage of 20% of US real estate transactions (since tracking started in 1981) took place in 1987.
The National Association of Realtors report's suggestion, that FSBO transactions are declining, has been described as misleading by Steve Udelson, CEO of Owners.com. who points out that NAR has also reported that flat-fee MLS now makes up 10% of transactions, and flat-fee MLS sellers are in substance FSBO sellers.
Unlike traditional real estate agent clients, flat-fee sellers are not committed to paying a commission and still advertise their homes as being for sale by owner. He suggests that the true size of the FSBO market is closer to 22%.
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If you are looking for a good FSBO, For Sale by Owner program, give 4SBO.TV a try.
FSBO: For Sale by Owner
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