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Standard Legal's For Sale By Owner Home Sale software allows anyone to quickly and easily create the legal documents necessary to sell a home and close the deal. Save thousands of dollars in agent commissions! Plus, marketing and sales strategies for selling your home are included. More »
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How big is the FSBO market?
The number of by-owner home sales (FSBO) in
recent years has reached nearly 25 percent. With one in four homes now
being sold privately each year, FSBO (pronounced "FIZZ-boh") is
moving beyond statistics, it's becoming a new real estate culture. (Read this article for details).
Real Estate Commission Trends
This graph is based on latest numbers
compiled from the market research done by Pacific Webcard since 2004.
The faded orange zone represents the commission values common to both
groups. If you have different numbers or comments about this trend,
and would like to contribute to this page, please send them to us.
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The FSBO Market Impact
While the first FSBO operations have made their
presence in the early '90s, they didn't really have a noticeable
impact on the [real estate] market until around 2003 - a point up to
which almost all real estate agencies were charging consistently (and
comfortably) a 7% commission for their services. Since then, however,
the FSBO services have been making a bigger dent in the real estate
market share every year while continuing to drive the realtors' fees
on a decline curve.
The market research we started in late 2004 now indicates that the
majority of affiliated realtors dropped their commissions* to around
5.5%, while a growing number of independent realtors now charge commissions
as low as 1% and 3.2%. FSBO operations charge a flat fee for their services.
The number of FSBO services that charge a commission is below 1%.
(*) In both Canada and the United States. |
REAL ESTATE TRENDS
Canadian FSBO operations are getting together. In
the fall of 2006, two Ottawa-based online FSBO
establishments, ByOwnerListings.ca
(BOL) and OttawaRealty.ca,
have begun a Canada-wide effort to unite as many as possible of this country's
FSBO operations... Yes, us at Pacific Webcard/Private-Listings.com, are part of this
collective effort. So, keep an eye on us; we're coming soon in your neighborhood...
Realtors are using (side) fsbo "programs". Our research also found
that, in addition to their regular schedules, some licensed realtors are
now crossing the line into the FSBO territory by offering parallel "programs"
which actually serve the by-owner market. While their new services are also
based on a flat fee format, their prices still exceed by far the fees charged
by FSBOs.
How do you deal with realtors' solicitations?
Understanding the size and
impact of the by-owner real estate market, will also help you
understand why by putting a house on the market will automatically
create a steady flow of calls from realtors. You have to appreciate
their position. After all, right now you are their toughest competitor;
their commission is in your pocket, and it looks like it's going to stay there. Or, is it?
There isn't anything spectacular that a realtor can do for you that you
cannot. You are the best seller for your house and realtors will do the
best they can to discourage you from keeping their commission. When you
engage in a dialog with them, they will make their case by presenting you
with over-complicated facts or scenarios; you will invariably hear about
the possible risks you are taking by selling privately and without
the proper guidance. Actually, things are quite different...
You are NOT alone in this! You got help!
Even though you are selling
your house by yourself, you are not in this by yourself.
In order to sell your house, you need to deal with a number of legal forms
and procedures. Most lawyers and notary public offices have in-house real
estate experts who, not only can provide you with the proper FSBO and
other legal forms for your state or province, but they can also assist you
in locating other related resources specific to your area.
They will guide you through the process and protect your interests throughout
the entire transaction. They can also help you to negotiate the best price
and advise you about the things, about your property, that the law requires
you to disclose to buyers. Whatever you pay them, it is not even remotely
close to the amount of money you could be paying a realtor.
Besides, since you are the one who separates the buyers from their money,
it is very unlikely that any buyer will sign any papers with you, without
ensuring that all is clear and both of you are in agreement. Don't forget
that, the buyers themselves are a great resource of information. Plus,
they too, will likely use the guidance of a lawyer.
Lastly, chances are that you, or a friend of yours, know someone who sold
their house without employing the services of an agent. While each FSBO
experience is unique, by talking with people who had already sold their
house privately, you will find enough common grounds that will prove to
be an invaluable, sometimes even crucial, piece of information for your own case.
For Sale By Owner software and legal forms from Standard Legal.
With a few key internet "home for sale" listings, the judicious use of local newspaper classified ads, and some well executed yard-signs, marketing a home on your own has never been easier than it is today.
And the tens of thousands of dollars saved in realtor commissions makes the effort worthwhile!
But the tricky part of a FSBO Home Sale -- For Sale by Owner -- has always been the "legal" side of the deal: putting together the proper paperwork, handling the necessary disclosures, finalizing the purchase agreements, changing over the deed, etc.
Standard Legal has eliminated the problematic "legal side" of a For Sale by Owner home sale by creating this comprehensive legal forms software! The software contains all of the easy-to-use legal forms necessary to sell your home on your own, along with complete instructions and a series of "bonus helps" related to selling your property.
Standard Legal software is downloadable and available for immediate use after purchase;
it is legal and valid in all states. Sell your home "FSBO" QUICKLY, EASILY, AFFORDABLY
with Standard Legal software! Learn more...
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Compiling FSBO Numbers
Currently, there is no central outpost that compiles numbers of private
sales of real estate in North America. For this reason, the FSBO market
numbers are not exactly something easy to compile, or readily available
- at least for the time being. The reported numbers of people who are
selling their homes privately each year varies by location, demographics,
reporting source and their methodology.
However, what is known as a fact that since the early 90's, the North
American real estate industry has been losing every year hundreds of
millions of dollars in agent commissions - and that, at an increasing
rate each year.
Since 1996, one single FSBO listing
service in Canada has managed to separate realtors from commissions
which (combined) amount close to 320 million dollars. That is money
saved by the home owners who decided to use private listing services.
Today, in one of Canada's biggest city, the fsbo listings now account
for more than 30% of the total real estate listings!
One other thing that we can tell you
for certain is that, due to the online FSBO operations, in the past
two years the realtors' commissions across North America dropped from
an almost consistent figure of 7% to an average of 5.5%. In fact, our
own research found real estate agencies that now are charging only
between 3.22% to 4.5% commission for their services.
We are always researching, looking at, and verifying numbers and sources
specialized on compiling FSBO figures and statistics in both Canada and
the United States. And, when we feel comfortable with any findings, we
make them available here. So, please return to this page for updates.
With all these being said, we know that we can continue to support our
claim that the current FSBO market activity goes well beyond numbers
- it's becoming the new real estate culture. A culture we invite you to
be part of.
Thank you for stopping by. If you are planning to sell your
property, click
here to learn about our listing packages »
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