Are you looking for a home to buy? Then you need to know about “for sale by owner” homes.
Even in 2022, there are a lot of great reasons to buy a home instead of renting one. However, something you may need to consider when looking for a home to buy is whether you should buy a house for sale by owner (FSBO) or one that is listed by a realtor.
Here are the differences you need to consider when buying a house for sale by owner vs. realtor.
An Owner Will Handle Everything
One of the things that’s different about buying an FSBO house is that the sellers will do a lot of the work that the seller’s agent normally would do.
This includes handling listing tasks and making changes to the property to ensure that it looks great, such as staging it. With an FSBO home, you’ll likely be communicating directly with the owner and they’ll probably be the person to show the home to you as well.
Problems May Be More Common
Houses for sale by owner might be a little bit more likely to have problems and there could be things that the seller is trying to hide from you. Scams are also possible as well.
You’ll want to be vigilant about checking out every detail of a home, even though the owner will be showing the home to you personally. You should also make sure to get an inspection to be sure that you know what you’re getting into.
Commission Fees Will Be Lower
Commissions for a home sale are generally around 6% and will be split between the buying and the selling agent. When the seller doesn’t use an agent, then about 3% of this will get cut out.
While it’s usually a good idea for you to use a buying agent anyway when buying an FSBO home, you can opt not to. This can save you an additional 3% or so on commissions and this can make the price of the home even smaller.
Hiring Outside Help is Still Wise
Remember that just because a home seller is opting not to use an agent, it doesn’t mean that you have to do the same. Hiring an agent can be helpful and they can help you with important parts of the home-buying process.
Additionally, it may also be necessary to hire a lawyer. Even if it’s not necessary to do so in your state, hiring a lawyer can be well worth it and can help you feel sure that you’re doing everything right when it comes to creating contracts and closing.
The Home May Not Be Priced Reasonably
Often when an owner lists a home themselves, they’ll price it too high. An owner may not do a good job of assessing the value of a home.
You’ll want to keep this in mind when looking for an FSBO home. Be sure to verify that the home has a fair price. Buyer’s real estate agents can help you ensure that you’re getting a fair price for the home.
Understanding the Differences Between Buying a House for Sale By Owner vs. Realtor Homes
While much of the home buying process will be the same, there are some differences between buying a house for sale by owner vs. realtor homes. No matter what type of home you buy, be sure to make your choice carefully and evaluate it before making a purchase.
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