For Sale By Owner “WATCH OUT”

OK SO HERE IS THE DISCLAIMER, “I’M A REAL ESTATE AGENT AND THIS BLOG POST WILL BE EXTREMELY BIASED IN ORDER TO PROMOTE MYSELF AND MY BUSINESS”

Reading that, read at your own discretion:

The reason I’m writing out about FSBO’s is that recently I took a Real Estate law course. I have taken law classes before but this was truly overwhelming. The course should actually be a prerequisite to becoming a Real Estate agent in my opinion. So I was actually pretty pleased with myself with the results I received back. I must have soaked all the information in because I think I got scared to death at all the laws I should know. Usually when I hear you could lose this amount of money for saying this and that minor phrases when speaking to people I pay very close attention. So here I am in my course about law and we started to get to the part about knowing something about a house and not mentioning it or if a client knows something about a house and doesn’t mention it. Now most people say yeah I’m honest and I would never misrepresent anything. Its funny so knowing what I know now after taking this course I then began to ask a few questions to owner of houses I would see when I would take a client out to see some houses and a few commercial condos. So first off I don’t know why clients are showing me a real estate agent their house like its show and tell. Owners in my opinion shouldn’t even be there during a viewing but hey sometimes they can’t leave or find a room to stay in. So we arrive in a room and the owner starts to say that we cannot go into one room because they just had it cleaned or some excuse to that effect. I was ok with it since it was a small room and I’m sure if my clients liked the house they would have a good inspection. My clients loved the house and were considering putting an offer. As we are leaving the house I go outside and happen to see one of their neighbors waiving at me. It was such a coincidence that we went to high school together and played football on the same team. After we caught up and went to his house for a coffee, (this was our last house we were looking at)  I started to ask him a few questions about the house I just looked at. I asked him why didn’t they use an agent etc, did they have a lot of showings, open houses, what did he think of the price? All valid questions for an agent to ask what’s wrong with these people and why they are not using me to sell their house which has been on the market for 4 months. So he then proceeds to tell me that they had some work done in the basement and there was a leak and they had some foundation problems and they were basically just patching things up for now because the basement is finished and etc etc. There was a whole story he told me but basically he said that they had a friend temporarily fix the problem, the leak is behind a finished wall. Now I know what you’re thinking, an inspection can cover that. Sometimes unless you rip out the wall you cannot detect a small leak. Sometimes that whole foundation must be fixed and if there is a finished wall it might not be detectable. Anyway it could get very technical from this point on but I don’t want to go there. So going back to my law course these people were representing that the house was fine and were just going to sell it, with just patching up a wall and not fixing the foundation. I could not believe it. I’m sure people get away with this everyday. Maybe this is why they didn’t want to list with an agent. I don’t know but this could be a lengthy law suit. Something like that could be in the tens of thousands of dollars, especially if the people buying the house sue for extra damages. The best part is in 2010 you don’t need a lawyer to sue for this. The maximum allowed in Ontario courts is $25000. Anyway I hope you enjoyed my recent experience and just think how many FSBO’s will be getting sued this year because of misrepresentation.

Now just to further promote myself and my profession here are a list of potential problems with FSBO’s:

This article was written by Gloria Smith and was taken from http://ezinearticles.com/?expert=Gloria_Smith

Many home owners opt to sell their properties without the help of a real estate agent because they no longer want to be burdened with the additional costs involved when dealing with professional realtors. This method of putting up your home for sale is not bad and there are many books, articles, and magazines written on the subject matter and these do help. However, even if you are equipped with the know-how, sometimes, FSBO can also be difficult and taxing. Some of the issues involved in FSBO transactions include:

- Being unable to list homes in MLS (Multiple Listing Services) – FSBOs are not allowed to list their properties in MLS because some MLS publications or websites only permit their members (usually real estate brokers or agents) to make the listing. There are exceptions to the rule and finding the exception is not an easy feat.

- Homes not shown by Agents – Unless you agree to give the buyer’s agent a commission on a sale that he might be able to close, you may not find agents gladly showing their clients your property on their own accord. Even if you do give a commission, without a contract (listing agreement), agents would still hesitate to show your property off.

- Overpriced Homes – This is the common problem FSBOs face. As the owner of the property, you will naturally think that your home is worth more than what the market is commanding. An overpriced home will deter buyers and very few will make a slightly lower counter offer, which you may (or may not) consider.

- Buyers are Intimidated – Buyers tend to discuss the pros and cons of a unit amongst themselves. In homes where a realtor represents the owner, they would feel more at ease asking about what they see as problem areas and can freely talk about the property. If you’re the one showing the place off, even if you are out of earshot, buyers would feel uncomfortable talking about the place, more so ask you about its troubles.

- Legal Troubles – Unless you know your real estate laws, you may encounter some trouble with regards to the legal requirements involved when selling properties. There are several documents that you need to fill up and you may have to alert several offices of your decision to sell your home.

These are just some of the difficulties FSBOs face. However, these are not tasks that are impossible to complete. If you really want to sell your home by yourself, by all means, go ahead. Just make sure that you do your homework well and, in case you meet a bump in the road, don’t hesitate to approach the professionals. They are there to help

Many home owners opt to sell their properties without the help of a real estate agent because they no longer want to be burdened with the additional costs involved when dealing with professional realtors. This method of putting up your home for sale is not bad and there are many books, articles, and magazines written on the subject matter and these do help. However, even if you are equipped with the know-how, sometimes, FSBO can also be difficult and taxing. Some of the issues involved in FSBO transactions include:

- Being unable to list homes in MLS (Multiple Listing Services) – FSBOs are not allowed to list their properties in MLS because some MLS publications or websites only permit their members (usually real estate brokers or agents) to make the listing. There are exceptions to the rule and finding the exception is not an easy feat.

- Homes not shown by Agents – Unless you agree to give the buyer’s agent a commission on a sale that he might be able to close, you may not find agents gladly showing their clients your property on their own accord. Even if you do give a commission, without a contract (listing agreement), agents would still hesitate to show your property off.

- Overpriced Homes – This is the common problem FSBOs face. As the owner of the property, you will naturally think that your home is worth more than what the market is commanding. An overpriced home will deter buyers and very few will make a slightly lower counter offer, which you may (or may not) consider.

- Buyers are Intimidated – Buyers tend to discuss the pros and cons of a unit amongst themselves. In homes where a realtor represents the owner, they would feel more at ease asking about what they see as problem areas and can freely talk about the property. If you’re the one showing the place off, even if you are out of earshot, buyers would feel uncomfortable talking about the place, more so ask you about its troubles.

- Legal Troubles – Unless you know your real estate laws, you may encounter some trouble with regards to the legal requirements involved when selling properties. There are several documents that you need to fill up and you may have to alert several offices of your decision to sell your home.

These are just some of the difficulties FSBOs face. However, these are not tasks that are impossible to complete. If you really want to sell your home by yourself, by all means, go ahead. Just make sure that you do your homework well and, in case you meet a bump in the road, don’t hesitate to approach the professionals. They are there to help

Ernie Arrizza

Ernie Arrizza

Sales Representative
CENTURY 21 Kelleher Real Estate Inc., Brokerage*
Contact Me

Tags