Boulder FSBO – No guidance, No representation, No BUYERS?
This weekend I met with some For Sale By Owners. Last year they had their home for sale with an agent. That meant they were willing to pay her to put the house on the MLS, market it and give them advice on pricing, negotiation etc. They were also willing to pay a Buyer’s Agent commission.
Their house is a fixer-upper. It is really well located and the lot has AMAZING potential. But when I say fixer… I mean the best idea might be to scrape the original house and rebuild further up the lot to capture the spectacular views and get the most value out of the location.
The house obviously didnt sell last year and the Sellers now believe they will do a better job of “spreading the word” between friends to find a buyer qualfied to pay $1.5M or so, than using the MLS, internet and Realtor-to-Realtor network. They are not offering to pay a Buyer’s Agent either, anymore.
Essentially they are looking for a buyer who is unrepresented to work with them (also unrepresented) in the matter of buying a $1.5M property that will possibly have a huge inspection report, benefit from a survey, have a very specific and probably more complicated loan process … And they are older, with English as a second language.
Apparently they took a liking to me last year because they called me over for a meeting and were so pleased to tell me that if I brought them a buyer, they would pay me 1% commission.
Let’s put aside the fact that I’m worth more than 1%. 🙂
1. Since anything on the MLS comes with a built in agreement to compensate the Buyers Agent, and is already represented by a Listing Agent who will guide the Sellers and work on their behalf, I’m definitely better off if my clients choose a property that is listed on the MLS… And I believe my clients are too.
2. If I have a Buyer Agent Agreement with my Buyers to compensate me my normal commission, I will have to ask the Buyers to pay commission directly – vs part of the purchase price and via the Seller at closing. All this does is tell my Buyers to offer less because the price doesn’t include the commission, unlike all the comps we are using to determine the offer price. The net to the Seller will be the same with or without the Buyer Agent fee built in.
3. If the Buyer Agent or the Buyers are less comfortable with the commission structure of a FSBO, they will simply bypass this house and put an offer on something else. The Sellers are, in fact, driving buyers AWAY from their listing!
4. Buyers are unlikely to ever hear about this listing. It’s not going to be directly fed to their inbox… or found while perusing Craigslist or Realtor.com or Zillow. They need pure luck to come upon it! Luck is NOT a good way to find the best buyer, the best price or the right terms for your property!
With all this in mind, if you are the Buyer looking for a South Boulder location, a project, wanting to custom build and for whom VIEWS are just the ticket, then I have a Boulder FSBO to show you! You’ll need to bring good walking shoes so I can demonstrate the potential, a great imagination and the willingness to enter into a contract that will not be run-of-the-mill. I believe the reward could be worth it though and honestly, if my budget accommodated this, I’d be all over it!