With the current Florida housing market remaining strong, driven in part by prolonged low interest rates, some homeowners may forego the help of a realtor and put their home on the market as For Sale By Owner, or FSBO.
According to a recent housing market report, closed sales on Florida single-family homes rose 8.8% compared to 2019, with the median price for single-family homes up 10.1% and for condo-townhouses up 14.5% from the previous year. The sales of single-family homes from $600,000 to $1 million are up 72%, and those of single-family homes over $1 million, a whopping 82%.
Pros and cons of FSBO
The chief reasons a homeowner might be tempted to put his home on the market as FSBO are to avoid the realtor commissions, to name his own price, and, where homes are selling like hotcakes, to take advantage of the trends in his area. A seller who has a trusted buyer will also have a good reason to sell as FSBO. If the seller understands the market trends in his area and is prepared to devote some time to advertising, or if he has experience with selling as FSBO, this can be a good option.
There are risks to selling a home without help from a realtor, however. Realtors know the market and can help with marketing on a multiple list serve (MLS), know the Florida purchase agreements and can deal with title companies. They will look for encumbrances on a home, set up inspections, do stagings and negotiate with the other side.
But then there is the commission. Where the standard realtor’s commission is 6%, a home that sells for $300,000 will cost the seller $15,000. That’s a lot of money for many people.
Deciding whether or not to do FSBO
There is no requirement in Florida for a realtor or attorney to be part of a real estate closing. However, whether it is title work, loan modifications or the drafting of real estate documents, your best bet may be to get help to make sure you haven’t missed something.
Whether or not you decide to list as FSBO, it is helpful to have an experienced legal professional to help you through the complexities of closing.