Welcome to City-Data.com Forum!
U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Real Estate
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
 
Old 11-20-2010, 11:45 AM
 
42 posts, read 84,553 times
Reputation: 27

Advertisements

Wanted to get an opinion on pricing a FSBO, since I have heard conflicting views. Does a buyer seeing a FSBO automatically think there is room for negotiation or will a buyer see value if priced right and realize that it is priced right? I understand that both sides want to feel they got something out of the transaction, but I am worried about pricing too low and getting low balled on that number.
Reply With Quote Quick reply to this message

 
Old 11-20-2010, 12:44 PM
 
Location: Simmering in DFW
6,952 posts, read 22,628,025 times
Reputation: 7295
It is extremely helpful if you get comps on homes that have sold in your area to help you price the house. If you don't want to use an agent, get an appraisal. I think most buyers who don't use a RE agent expect to share in your commission savings, otherwise why wouldn't they use an agent? Almost all buyers these days are low balling...FSBO and represented properties are very much exposed to bargain hunters b/c of the buyers' market we have at this time.
Reply With Quote Quick reply to this message
 
Old 11-20-2010, 03:33 PM
 
Location: Salem, OR
15,513 posts, read 40,257,352 times
Reputation: 17383
Quote:
Originally Posted by edavid944 View Post
Wanted to get an opinion on pricing a FSBO, since I have heard conflicting views. Does a buyer seeing a FSBO automatically think there is room for negotiation or will a buyer see value if priced right and realize that it is priced right? I understand that both sides want to feel they got something out of the transaction, but I am worried about pricing too low and getting low balled on that number.

Yes they will see value if priced right. The key is to be priced right. Most often FSBO's aren't realistic about their home price. Don't pay attention to active listings. Pay attention to what they actually sold for.

I work with FSBO's all the time as a buyer agent and my clients have paid full price on some because the buyers knew that what the seller was asking for was a good price.
Reply With Quote Quick reply to this message
 
Old 11-20-2010, 06:29 PM
 
Location: NJ
17,574 posts, read 46,027,389 times
Reputation: 16271
I would think that buyers are going to expect at the least about 3% below whatever they consider market value.
Reply With Quote Quick reply to this message
 
Old 11-20-2010, 07:27 PM
 
Location: DFW
40,930 posts, read 48,945,506 times
Reputation: 54922
Most FSBO's I see overprice a home thinking they are going to get lowballed or catch some uninformed buyer. That IMO is a mistake.

Set a good reasonable price and stick with it. Also don't go under contract with a bad credit buyer.
Reply With Quote Quick reply to this message
 
Old 11-20-2010, 09:25 PM
 
1,174 posts, read 6,929,187 times
Reputation: 1104
As a buyer, my first impression about a FSBO is that it's going to be priced too high, but I also assume that with any listing. When I look at the comps, it usually turns out to be true. I'm sure that there will some some that aren't priced too high, but my experience has been different with FSBOs in general. In all cases, I expect to negotiate, since that's the name of the game, and offer a lower price than is listed for the house.

When I look at the history on a FSBO house, I often (not always) find something else, too. Often the house had been listed with a Realtor and it never sold by the time the listing expired. Sometimes they still have the same price on it and sometimes it's higher. In each case they're overpriced, that's why it didn't sell when it was on the MLS.

Ultimately I've never involved myself with a FSBO purchase. I didn't want to deal with fighting the seller's conception of the house value. However, if I did make an offer I would certianly do my due dilligence with the sold comps and the direction of the market before making an offer.

Let me give you an example of a FSBO near me. I was just chatting with the owner the other day. He had put up FSBO signs during the summer. I called at that time and he quoted the listing as $399,000. I felt the house might be overpriced at the amount, but I never followed through with any research because it really didn't meet my wants.

He has since taken the sign down and I have moved into another house I subsequently bought. During our chat, we were discussing the market and he told me about an appraisal he got earlier in the year. He didn't say anything about subsequently listing the hosue as a FSBO, but he said that his appraisal had come in at $340,000.

So, from his perspective he had a professional opinion of value set at 340K, but chose to FSBO it at 59K higher. I never told him that I had called about the house during the summer, but that's an example of what I've found with FSBOs.

I have another example, too. For some reason a neighbor came over to me within a few days of moving into the house we bought. For some reason it appeared that he thought I might want to purchase his house so he told me that he'd like to sell it and get out of it what he had paid for it in '06. Yeah, right! There's lots of people in this country who would like to do that.

He went on to explain that he'd order an appraisal on the house and it came in at 650,000, but he thought it was too low. He shopped around and got a second appraisal at 690,000. Then he told me he was going to try to FSBO the house in the Spring for 740,000. He's into the house for 700K. I guess he doesn't believe his "professional" appraisals and hasn't been reading the paper about the local markets.

Those are just a couple examples of what many people find about FSBOs in general. It affects some buyer's initial opinions about what they will find because there are far more that are overpriced than those that are fairly priced or aggressively priced. It makes it hard on the FSBOs that aren't overpriced and aren't factoring in non-issues like daddy's garden, mama's tree or the loving family memories in the house.

If you're going to FSBO, I would say do your homework, identify sold comps, determine the direction of your market and then price your house appropriately. Keep those comps so you can show them to any potential buyers or use them in negotiations. If someone lowballs you, don't be afraid of them doing so. You can always say no or couteroffer with something higher. If they walk away, you didn't lose anything. They wern't serious for anything other than a distressed sale.

Last edited by garth; 11-20-2010 at 09:36 PM..
Reply With Quote Quick reply to this message
 
Old 11-21-2010, 12:33 PM
 
Location: Pomona
1,955 posts, read 10,957,231 times
Reputation: 1562
Quote:
Originally Posted by manderly6 View Post
I would think that buyers are going to expect at the least about 3% below whatever they consider market value.
Exactly. Folks do a FSBO in attempts to gain the most return, but the buyer also knows that since it's a FSBO, you're not paying an agency 4-6% either. And so the bargaining begins ...
Reply With Quote Quick reply to this message
 
Old 01-06-2011, 09:10 AM
 
2 posts, read 2,344 times
Reputation: 10
If you have your home priced right, the Buyer shouldn't expect to get away with a lowball offer. If you do research on other homes that compare to yours and price yours accordingly, perhaps a little below what they sold for, you should have a pretty fair price. If you kept that information on hand you could show it to the Buyers as well, so they see how reasonable your price really is. If you're trying to sell your house FSBO, I'd recommend this site Homes for Sale by Owners (http://freerealtyonline.com/homes-for-sale-by-owners/index.html - broken link) - you can list your home for sale on it totally free. The vast majority of buyers look for their home online, so it'd be a good place to start. Plus they have free real estate forms (like Offer to Purchase, Counter Offer Forms, etc) that you can print. They also have a blog with helpful information for owners putting their homes up for sale without an agent. It's www.freerealtyonline.blogspot.com. Hopefully that helps you!
Reply With Quote Quick reply to this message
 
Old 01-06-2011, 09:44 AM
 
1,216 posts, read 1,078,033 times
Reputation: 1351
It seems that it is still a buyers market, price it according to comps/condition, then negotiate your bottom dollar.
Reply With Quote Quick reply to this message
 
Old 01-06-2011, 09:57 AM
 
11,113 posts, read 19,452,306 times
Reputation: 10174
Quote:
Originally Posted by edavid944 View Post
Wanted to get an opinion on pricing a FSBO, since I have heard conflicting views. Does a buyer seeing a FSBO automatically think there is room for negotiation or will a buyer see value if priced right and realize that it is priced right? I understand that both sides want to feel they got something out of the transaction, but I am worried about pricing too low and getting low balled on that number.
It can work if you price it right of course. You obviously don't want to pay a commission for one reason or another, and that is fine if you can do it yourself. Get accurate comps of what has SOLD in your area, go to the town hall and look them up if you have to. Try not to rely on Trulia or Zillow or websites as such. I have given comps over the years to FSBO's and have ultimately ended up with the listing after advising the seller not to wait too long, the best buyers looking for that type of home in a particular area will surface within a month or so. After that, you are at a total disadvantage. In most average markets, 85% of homes are sold within the MLS system through Realtors. Most sellers do not have the proper exposure and advertising experience. Remember also, that buyers have no incentive to purchase from an owner directly; unless they are savvy and have done it before.

I say go for it for awhile, then review your options once you get some feedback. It's all about price in this market, and every buyer is looking for a deal, and they are making low offers. (But that does not mean you price it $10K higher to generate a low offer.) If anything ... price it BELOW your competition.
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:


Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Real Estate
Similar Threads

All times are GMT -6.

© 2005-2024, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Contact Us - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37 - Top