FSBO Advice

April 12, 2017 10:26 AM

Have you purchased property that was sold FSBO? What do you wish you knew before you did so? What would you do differently next time? What advice would you offer someone who was going through the process? I'm in the Boston area, should your advice be location-dependent.
posted by NotMyselfRightNow to Home & Garden (6 answers total)

I sold an apartment FSBO, in Boston, a few years back. It was remarkably straightforward. Buyer and I agreed on a price, after some protracted haggling. We both then got real estate lawyers involved to generate / review the necessary paperwork. I paid mine a flat fee of $1000 (up from the usual $600 he charges due to the slightly larger amount of legwork required of him without the facilitating presence of a real estate agent).

Advice-wise, I guess I'd suggest that you have an attorney lined up and ready to go, and involve them early in the process. Really though, there wasn't much to it. I was surprised how little value a real estate agent would have added in exchange for their 6%.

Also, remember that you and the seller will need to collaboratively arrange whatever inspections and walkthroughs are needed for the place to change hands. In Boston, that will usually include a fire safety inspection and your inspector's walkthrough, as I recall. Your attorneys will be able to suggest how to get those steps accomplished.
posted by killdevil at 12:30 PM on April 12, 2017

I bought unimproved land FSBO, and the only thing I'd do differently is avoid all face to face interactions with the seller(s). Sitting across the table from six people with a bunch of family drama going on, some of whom decided closing day was a good time to attempt to change the deal was not fun.
posted by bradf at 4:54 PM on April 12, 2017

I'm an Oregon Real Estate broker though not active at all, but was taught the advantages of working with a FSBO. If you work with a broker (agent) to buy, your broker has a lot of knowledge of current market values and prices that FSBO owners don't have, ie. the MLS. If you work with a broker, they do all the negotiation for you. FSBOs can be tricky because you have to have those FTF meetings with the seller to settle on the price but a broker can do all that work for you.

Working with a broker/agent doesn't cost you anything - the seller pays - and with the demand in today's market, your seller's profit will probably be enough that the the 6-or so % isn't a big deal.

I was trained to go to FSBOs and say, "Your buyers are going to have a professional arguing against you, do you really want to sell your home yourself?" As a buyer of a FSBO you can be at a distinct advantage.

Again, I'm legally a broker but not your broker and left the business in October 2016.

All the best, memail if I can answer any questions.
posted by bendy at 10:30 PM on April 12, 2017

Also, I sold a condo in Springfield, MA in 1996 by sending a letter to the other owners in the complex asking them if they were interested in buying it and sold it for their asking price.

In retrospect, especially in terms of my new knowledge, me (or an agent) could probably have raised the price a bit higher.
posted by bendy at 10:34 PM on April 12, 2017

I bought a house FSBO (not in Massachusetts). It was my second home purchase, so I already knew pretty much what I'd need to do, and that's what you'll need if you don't have a realtor holding your hand—you'll need to know what advance work needs doing, and then coordinate it: home inspection, title search, appraisal, survey, that sort of thing. The exact list of advance work will depend on local law and possibly your lender.

We lined up a title agent, who met us and the buyer at the house we were buying to handle the closing. Then we cracked open a bottle of champagne. It was nice.
posted by adamrice at 7:35 AM on April 13, 2017

Disclaimer: have looked at but never purchased FSBO properties. In the heady days of the real estate boom, I used to see flippers or developers putting property up at "ok for the boom" prices, FSBO, to increase their profits. Nowadays, I see a lot more FSBO because the sellers want or need more from the property than the market will bear. (Of course, this is survivors bias... I wouldn't necessarily see property sold quickly through neighborhood or personal relationships, or property priced so aggressively it gets snatched up immediately! Discount this advice if either of these fits your situation!) Look carefully at the price history on the property. Has it been on and off the market a number of times? Or up for sale a long time with few price decreases? That may mean a few agents have quit because the sellers don't want to face reality about the price. Did someone buy it cheaply in the last ten years then raise the price by a massive amount? Do your due diligence with any kind of a flipper, in case they're trying to recover after overspending in proportion to the value of the house or they are charging full market value for a fixer upper with cheap cosmetic repairs/"upgrades."
posted by Gable Oak at 5:50 PM on April 13, 2017 [1 favorite]