I hate acronyms: IOUs
make me nervous, "yuppies" drive up the
price of Chardonnay, and ASAP is my editor's way of
telling me I missed a deadline. But the acronym I
dislike most is FSBO. Pronounced "fizzbo,"
it's real estate jargon meaning "For Sale by
Owner." Each year, some 850,000 or 15%-of the 5.6
million homeowners who put houses on the market try to
save the 6% or so broker's commission by handling the
sale themselves, according to the National Association
of Realtors.
If you're like most sell-it-yourselfers, listen
up: Don't waste your time. A good agent can bring more
potential buyers to your door, not only because 85% of
buyers still shop through a broker, but also because
there's a real skill to pricing and selling a home.
Trust me on this. When I dropped out of law school
(don't ask), I spent two grueling weeks studying for a
real estate license, a process far more complicated
than my best friend's aunt's sister-in-law led me to
believe when she sold me on the idea. Yes, I passed.
And one of the many things I learned was that agents
handle lots of the grunge work (lawyers, insurance,
loan searches) that are part and parcel of a real
estate transaction. That's reason enough to hire one.
More important, your fizzbo may leave you with
less dough than if you had used a broker. Why the
shortchange? Some fizzbo sellers price their homes too
low, missing out on big profits. But far more
homeowners overestimate their home's value, and that
keeps bidders away. The longer a home goes unsold, the
more would-be buyers wonder why and back off. If
there's little competition for your home, you're
likely to get lukewarm offers. "A real estate pro
knows how to price your house to move it
quickly," says United Homeowners Association
president Jordan Clark. One last point: Buyers know
you're aiming to save a buck when you try a fizzbo. So
they'll expect you to share your "savings"
by accepting a little less than your asking price.
from: Family Money
November/December 2000
by:
Gary Belsky, coauthor of Why Smart People Make Big
Money Mistakes-And How To Correct Them (Fireside;
$12).
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