Why It’s a Bad Idea to Be a For Sale By Owner — FSBO — in Sacramento
Although I have done it myself in the past — back when I was young and foolish with not nearly as many wrinkles as I have today — I still don’t advise it. I’m not saying this because I am a Sacramento real estate agent. I’m promoting this because I’ve been in the business long enough to know how many small things that can mushroom into big things can go wrong in a real estate transaction and, for that reason alone, you need a real estate agent. It’s just not a good idea to try to sell your home yourself as a FSBO (for sale by owner).
A seller in the Elk Grove area called me yesterday. He asked if I recalled our meeting in my midtown office 3 weeks ago. He had been interviewing Elk Grove agents to sell his home in the Elk Grove area. I sell a lot of homes in Elk Grove and Laguna, primarily because that’s where many homes are for sale and these neighborhoods are in high demand right now.
I did remember meeting him. In fact, before our meeting, I had emailed him a CMA for his home. We spent a good hour at my office going over the plat map, the county records, discussing how he needed to bring some technical aspects up-to-date, pouring over the comparable sales, explaining how to adjust the comps by adding / subtracting for improvements and variations. I also gave him a range of price in which I felt his home would sell, but cautioned that it may sell for more than our asking price in this seller’s market. It’s hard to predict exactly what a desperate buyer might do.
The reason that he called was to tell me out of all the agents he interviewed, he felt I was best suited for him and the most professional. However, and yes, there was that little BUT in his voice, he has decided to sell to his tenant and he is selling the home himself as a for sale by owner. I had done such a great job presenting what I would do and how I would do it, that I made it look too easy. This guy somehow believes he could do it himself.
He probably can sell it himself, but will it close at the sales price? Did he get the highest sales price he could possibly get in this market? Was his home exposed to the largest pool of buyers to get him the highest price? What will he do if the underwriter throws out the buyer’s loan at the 11th hour? How will he handle technical title issues that affect his land? What comparable sales will he give to the appraiser to assist the appraiser in determining value should the present comps fail to support him? How will he handle the home inspection? Will he fill out the disclosures correctly, and does he have a list of every disclosure the seller needs to provide?
He thinks he will walk out of this transaction with a big chunk of change. Money that he would like me to help him to invest in fixers. Although, he has no experience buying fixers to flip, and there are very few opportunities in Sacramento at the moment. He doesn’t strike me as a flipper. But he also didn’t strike me as a person who would try to sell his home by himself. The main reason to try to do that is to try to save commission, but in his case, he is probably losing more money than the commission would have cost him.
He asked me about the FIRPTA. How should he fill it out?
Really? He’ s got to ask himself that question, not a person who does not represent him. If he wants to be his own real estate agent and represent himself, he’s got to pull himself up by his bootstraps and get with the program.