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For sale by owner (FSBO)

The biggest motivation for homeowners who want to sell their own home is to avoid having to pay a sales commission. On average, the total commission a seller pays is around 6%. Usually 3% will go to the buyer’s agent and the other 3% will go to the seller’s agent.

When you list your own home you will not have to pay the listing agent’s 3% commission. However, you will still have to pay the buyer’s agent a commission if one of their clients buys your home.  Agents work on commission and if you offer too low a commission then they may not be too keen to bring potential buyers to see your home.

If you decide to go FSBO you will need to decide how much of the process you can complete by yourself. This includes adding your listing to the MLS, preparing professional-looking flyers, deciding on the listing price, dealing with the purchase and sale agreement and other paperwork, negotiating offers, holding open houses, etc.

An often quoted statistic (plus or minus a few percent) is that 85% of all FSBOs end up going with a real estate agent in the end because they were unable to sell their home by themselves.  According to a survey by the National Association of Realtors, in 2007, 12% of sellers went the FSBO route, down from a high of 18% in 1997. Some of this may be due to the increase in complexity of the overall process.

I attempted to find some independent third party statistics but was unable to find any. Websites dedicated to FSBOS tended to have glowing statistics in favor of selling your home whereas the opposite is true for real estate agent side. The real stats probably lie somewhere in between.