For Sale by owner (FSBO) listings are kind of unorthodox, and chances are, you haven’t done it before.  Because this process is likely new to you, if you don’t get a lot of traffic right away, it’s easy to get frustrated, give up, and go hire real estate broker.  Resist that urge and stay the course.

You can think of your For Sale By Owner (FSBO) listing as a marketing campaign.   You’re promoting your property, the same that a broker would do if you hired one.   And with any marketing campaign, there’s a lot of value in persistence.   You’ve got to give it enough time to work for you.

Let me give you an example of a client who gave up too quickly on her FSBO listing and it ended up costing her dearly, because I don’t want the same thing to happen to you.

The client, who was selling a condo on the North Side of Chicago, did everything right initially except for her list price, which was too high.   Her presentation was terrific, and she put her listing on the MLS and all the right sites.

Our client really wanted to sell quickly.  But because her list price was overly ambitious, after a couple weeks, she just wan’t getting any traffic, and became frustrated.  So without consulting with us, she signed up with a conventional listing broker, a 6 month, standard Exclusive Right to Sell Listing Agreement, 6% commission.

What she didn’t realize, and it wasn’t explained to her, is that these Agreements grant the broker a commission regardless of whether the seller finds the buyer or the broker finds the buyer.   That’s why it’s called an Exclusive Right to Sell.  Terribly unfair to sellers, but used in just about every conventional sale.   After she signed the agreement, if our client found a friend to buy the property, she would still owe her broker.

Well, you’ve probably guessed where I’m headed with this.  Before her conventional broker had even activated the new listing, our client learned that a friend was interested in buying the property. The friend submitted an offer at asking price, which our client accepted.

The broker had done nothing except list the property.   No showings, not even a phone call.  She only saw the place once.  Despite that, she had a right to collect a full 6% commission from our client.   A very costly mistake by our client to sign exclusively with this broker, and I really felt terrible for her.  How costly was it?  The broker’s 6% commission was $8,940.   If our client had stuck with her for sale by owner listing for one more day, she would have only paid 2.5% to the buyer’s broker, $3,425.   So our client lost $5,515.

Staying the course for one more day with her for sale by owner listing, and our client would have avoided this mistake.  But also, if she had just spoken with us before she signed with her conventional broker, we could have put a stop to that process by, at the minimum, modifying the language of the Exclusive Right to Sell Agreement.

So, trust your for sale by owner listing.  Give it some time to work for you.  If you don’t have good traffic initially, it’s probably the price.  Think about a price decrease.   But also, get us involved.  Never sign up with a broker without having the listing agreement reviewed by an attorney.  Don’t be afraid to ask us questions and run you thoughts by us.  That’s why you’ve got us in your corner.   We always want to help and see you get the best deal possible for your property.

-Peter L Berk, for SaleByOwnerLaw.com  and O’Keefe, Rivera & Berk, LLC