Buying a “for sale by owner” or FSBO can save you around 6% of the cost of the house. However, there are a few things buyers should know about buying a for sale by owner.
What do you save on commission?
As a buyer, you don’t pay for either the listing or selling agents commission, the seller pays for both. Does that mean that commission fees don’t affect the buyer? Well, commission fees are sometimes factored into the price of a home, by the sellers.
No access to the Multiple Listing Service
Without an agent, you won’t have access to the Multiple Listing Service (or MLS), which is a tool only agents can use to find homes for sale. The MLS also helps to sell homes faster.
You’re losing an advocate
Things like a home inspection, appraisal, title to the home, getting the best mortgage rates will pop-up during this process. Having an agent to help you through this process may be worth the fees. Realtors have knowledge about fair market home prices, and many contracts are voided when a buyer and seller are negotiating because they cannot come to an agreement.
FSBO homes could be overpriced
A buyer's agent will confirm the property’s value and help you come to the best negotiating price. A for sale by owner us most likely trying to avoid seller’s commission and so tries to sell on their own, being so focused on money, they are often overpriced.
If you are a good negotiator and can form a good relationship with the seller, than a FSBO home will be a whole lot easier for you.