The truth please about FSBO

The prob w fsbo is that all the apparent benefit goes to the seller. As a buyer there is no incentive to play, unless your place is all that. Fsbo means sticky on price, negotiating with an owner who is emotionally attached, and cheap OH cookies. If you were in the market for a midtown condo would you be attracted to a fsbo over a brokered listing?

Well for starters, lol, my open houses held by a leading real estate firm didn't offer cookies or anything (maybe that was my brokers choice!) . But I'm not so sure I would have many frequent open houses anyway as they seem to produce alot of lookers and no real buyers....I think that the "by appt. only" tends to bring more serious people to look at the property.

I'm no longer emotionally attached to my apartment as I have been trying to upgrade for about a year.

If I was looking for a midtown condo and found my listing on street easy, trulia, ny times, etc, I would be willing to deal without a sellers broker knowing I would save money in the end. The 6% commission I would have to pay the broker as a seller is already factored in the price advertised by the brokerage house to begin with. And nowadays almost no one is willing to pay the listing price, it's almost a joke with using a listing price, and if you list too low, they will want to negotiate down from that. I think I can come up with a price that will beat the comps for a similar apartment in my building, and I won't have to pay the commission. I think that would be attractive to a buyer being offered a very fair price for starters.

This has just been my past experience, thats why I am thinking why not try the FSBO route? Is it as mysterious as people tend to make it.

Thanks for your comments spinnaker 1.

my thoughts.

I have sold places in Manhattan, both FSBO, and others with the help of excellent brokers.

FSBO, if well done, can be terrific. But that means you are willing to do the following:

1.) Seriously spend time researching comps in your area of the same size and quality to get as many data points as possible in order to make the most informed decision possible as to price.

2.) Have a professional photographer stage and photograph your home (I did this for about $1,000, and they took gorgeous well staged pics of my place with wide angle lenses and in one case 'fogged' one of the windows that didn't have such a terrific view - in the end, I used about six or eight photographs on the website).

3.) Write clear, descriptive prose about the unit (and please be sure to check grammar and spelling!). I suggest reading lots of other listings to see what YOU (if you were a purchaser) like about them and what to you don't.

4.) If you can't do it yourself, you need to have someone design a clean, handsome easy to navigate website (this person should also provide a clean, well designed floor plan with REAL TRUE square footage measurements for each room and area within your space). I suggest NO flash applications, and a simple front page with all the pertinent information in a few easy to digest and straight to the point paragraphs, with clickable pics and a floor plan that enlarge. I was unable to do this all myself, and so paid about $1,500 to have someone do it for me.

5.) I also suggest clearly stating (along with price, maintenance, cc, taxes, etc.) that buyers with brokers are welcome, but for brokers to please not contact you directly if they are seeking to represent you as the selling broker, so that your position is clear.

6.) I suggest picking one weekend day/time (like Sundays from noon to 3:00) and one weekday evening (like Wednesday from 5:00 - 7:00) for open houses.

7.) I would get a cheap cell phone (disposable?) and use that number as the contact number where people can call and leave messages. On that phone you can leave a message that thanks people for their interest, confirms and updates the open house dates, and also confirms AGAIN that buyers with brokers are welcome, but for brokers to please not contact you directly if they are seeking to represent you.

8.) I can't strenuously enough remind you that you'll really have to keep the place extra spotless and orderly. I went to the extent of even making sure that closets were super cleanly organized (everything hanging at exactly the same heights, even underwear drawers with everything folded and organized 'just so'), the kitchen drawers and cupboards super clean and also orderly (even the silverware drawer perfectly aligned - and REALLY CLEAN out and organize that awful area that most people have under their sink!), and bathrooms absolutely spotless. I know this sounds really OCD, but people do project themselves living in your space, and all these little things add up to assisting the potential buyer in imagining making your place theirs. I even made sure the kitchen cupboards were filled with attractive full boxes of gourmet foodstuffs, and that the fridge and freezer were not only spotless inside, but were also filled with delicious looking super fresh fruits, vegetables and gourmet prepared foods. Buyers, if they are smart, will open every drawer and closet (I know I do!).

I'm sure there are some things I've missed that others can add, but I hope that helps for a start, at least....

Oh yes - two more last things.

When you have the open house(s), the big question is always - "should you be present?" My answer is "definitely yes." But I do fell it is really important, however, that once you greet people as they enter, that you simply say "please feel free to look anywhere you wish and take all the time you need - if you have any questions, I'll be reading over here (in some out of the way spot)" And then do that. DON'T FOLLOW THE PEOPLE AROUND LIKE A PUPPY DOG. Don't try to "sell the place" - they'll either like it and come over to ask you questions (and then you can slide in a few low key observations about aspects you like about the place) - or they won't, and that's that.

Also (and I can't believe I forgot this one!) - before you do any of this! Make sure that you have an excellent real estate attorney already engaged on your side, and be sure they are aware you're doing an FSBO. They may have some good legal observations, and more importantly, that attorney will be the person who runs the deal for you - so you want them in place and on board with all systems "go" before anything else happens.

Another thing to consider is exposure......not every buyer is looking in the Times or Street Easy. As a broker who frequently works with relocating buyers, it's up to me to find suitable property for my buyers to view in course of a short visit. If you're excluding brokers your also cutting out a pool of potential buyers. This may work well in a hotter market where the buyers outweigh sellers, but can be more difficult in these times where the reverse is true.

ioserin makes a very good point.

The last time I FSBO's was 2005, and even then, the NY Times real estate website listing page was a primary source for buyers looking to see what was available, so by simply taking out an ad there with pics and floor plan and a web address for more info, I probably got to 90%+ of potentially interested buyers. I don't know exactly where/how I'd advertise now.....

I was a FSBO long before I was a real estate licensee. Of course you can sell FSBO. It's not a hot topic with me.

If you don't want broker's solicitations, just add "no brokers" to your ads. Otherwise you will hear from lots of brokers. That's their job, after all, but it's easy to stop.

As an option, you can offer to pay a commission to a broker who brings you a successful buyer. If I were selling my own property now, I would do this. There is the occasional buyer who will not work directly with an owner, for a variety of reasons, and you might as well capture them. but if you don't want to, that's up to you. When I work with FSBOs in these situations, we have an agreement in writing.

Karla Harby
Rutenberg NYC
Kharby

matsonjones, you really have lots of money to throw at people.

$1K for a photographer? did they shoot your wedding for 5 hrs? It takes just about 1 hr to take quality pics of your apartment and there are plenty of photographers in the city who can do the job for $200.

$1,500 for a floorplan and a cookie cutter website? it seems the OP is selling a studio or a small 1 br. to create a floor plan will not take more then an hour and the website an additional hr. so, 3 hrs at $500 per hr, wow.

this is not 2000, a 12 year old can put together a floor plan, take decent pictures and do a nice website from the predefined styles already available for sale for about $50. the 12 yr old will only charge your $25 per hour and will charge you for 6 hrs saving you a small fortune. lol.

damier212,
if you want to sell by yourself and you have been on the market with the broker for a period of time already, as it sounds, you can do it. the only thing that will bring people out is the price adjustment. it seems that you know where to advertise (streeteasy, trulia, craigslist, zillow, nytimes in that order). when i was selling my apartments (2005,2008), i found the least knowledgeable people would call from the times. no dogs was marked, they called will 50 lbs dogs. 20% was marked, the called with barely 10% down. coop was clearly indicated, they called for condos.

do give a buyer's broker a reasonable commission, say 2-2.5%, to ensure that you don't miss those who cannot use a computer to do their own searches.

there was a times article in april time (http://www.nytimes.com/2010/04/11/realestate/11cov.html?_r=1&scp=9&sq=open+house+sale&st=nyt) that confirmed open house sales are less then 20% and most sales occur with appointment. sure you can do open houses every day of the week and on weekends, but why bother. do one every 2 weeks and don't waste your time.

best of luck to you on your journey.

if you list FSBO, and say no brokers please, does that mean if a sellers broker sees your place in a search they would not take their seller because they would not be getting a commission? thx

You could pay for an appraisal, in case you want to support your price point. People usually say that FSBO's aren't priced right, so this could help, if you don't have any good comps.

I think all MJ's suggestions are good ones ...but they're general. As I understand your particular circumstances, based on your other posts, your co-op is being threatened with a lawsuit. So you have to answer the particular question, how can I clear up that cloud in the mind of a potential buyer?

Answer that question, and you can sell your place.

ali r.
DG Neary Realty

front_porch, in his first post damien states "I am talking about a condominium apartment in midtown Manhattan."

where did the coop come from?

Im with MJ and Ali, as I usually find myself in agreeement with Ali here..I would like to add:

APPRAISAL for valuation purposes - Let me tell you something..I find what that appraisals prior to a signed deal to be a very 'rough' estimate of what your home is worth. Sellers tend to overestimate the ability of an appraiser to nail down the fair market value of any given property at any given point in time. Finding this fair market value range, is extremely difficult. The reason appraisals come in at the number after the deal is done, is because they have the contract price right there to review. They see the bid! Take that away, and your likely to get a number quite different than what the open market can bear. So use caution here. Ive seen appraisals pre-deal come in quite high, sometimes as high as 20% higher than where the bid ends up coming in. In short, these are situations where the asking price then goes lower than the appraisal and the broker says something like, 'hey, we are asking 1m and this place was just appraised at 1.1m'..well, I hate to say it, but a pre-deal appraisal is NOT what your place is worth! Your place is worth what someone is both willing and able to pay at a given point in time. Before that becomes clear, use caution, because its just a best guesstimate based on recent comps!

BROKERS WELCOME - This is the biggest thing to consider. What you need to do is properly incentivize the buyer agent that may have a client out there. Your already saving the sell side half, so dont get greedy! In my opinion, this should NOT be lower than 2.5%! In fact, it might pay off to leave it at 3%. People think this covers those that do not have the capacity to search online for a showing. But TRUST ME, there are many highly qualified buyers out there that do in fact search on their own but are LOYAL TO THEIR AGENT! They want buy side representation - for many reasons. Just because some don't doesnt make it the case for the entire market. You want to welcome and incentivize that buyers broker while at the same time, make it clear to sell side broker vultures that as a FSBO, you have NO intentions of being pitched an exclusive marketing agreement. Big difference.

Good luck!

FWIW: Here's a few comments from a recent buyer who went to a few FSBOs. They generally turned me off. Here's why:
1) Price was same as comps that had brokers. Dealing directly with seller was not appealing--especially for no benefit to me.
2) Unprofessional conduct. Granted, plenty of brokers leave something to be desired, but the FSBOs I saw uniformly were weird people.. One guy in his 40s (e.g., he wasn't a kid) came to the door barefooted. It's a silly thing, but I couldn't picture myself living in the space with this guy spreading his athlete's foot all over it; he made me gag. There were several who followed me around so I couldn't talk freely to my partner. Listening to an owner extol the beauty of the hideous suburban kitchen they had installed was a huge turn off.
3) Dirty: smelling dirty diapers does not say "come live here." Cooking odors is gross. Clothes in washer/dryer is not appealing. Toilet that isn't sparkling or a shower that is still wet with the just-used towels hanging on the door is a turn-off. These are things many decent brokers would spot and take care of. Unfortunately, I found most FSBOs lacked an objective eye or were too lazy or indifferent to properly prepare their homes for viewing.
4) Unknowledgeable. I 1/2 expected many brokers to have to get back to me on various questions about building finances, assessments, capital projects. I was hugely turned off, though, by FSBOs who didn't know answers. It was their building! If they were so out of it as to not have a handle on issues concerning the building, I didn't want to suffer through a closing with them.
5) Convenience was compromised. As a buyer, I hated the prospect of dealing with a board package and the details of coordinating a closing. Brokers eventually took care of most of that for me. I gathered docs, needed guidance on some of them, and then delivered the pile to my broker to assemble, copy, deliver, whatever. The seller's broker provided guidance about the board. Both coordinated the closing with the attorneys, banks, etc. Most FSBOs however left me with the impression they were clueless or wouldn't not be assisting at all in a meaningful way that would contribute to an easy, successful transaction. Since I had nothing to gain whatsoever by purchasing from an FSBO, the value added by good brokers (please don't start--there are some) was essentially free to me and preferable to the owner fumbling through it all which could cause headaches, delays, or even a failed transaction.

Everyone of these issues is addressable. I don't get why the FSBOs I saw seemed to go out of their way to make the experience of seeing their places and meeting them so unappealing. If you go the FSBO route, I am sure you can do it well if, like in most endeavors in life, you really think it through and do it right.
--left me thinking, "why would I want to deal with this person directly for an expensive transaction of a type they are not an expert in?" I looked at coops and the idea of the FSBOs advising my on the board and putting the package together

sorry, ab, I meant condo. That must have been a psychological slip as I'm sure I know the building in question.

More discussion here: http://streeteasy.com/nyc/talk/discussion/24395-what-a-sellers-broker-should-know

ali r.
DG Neary Realty

Kyle, I am in complete agreement with regards to the yuck factor you mention. But I've seen a surprising number of broker-represented listings that were absolutely filthy (dirty dishes in sinks, clutter on every surface, junk covering the floors, even unflushed toilets in one case). A broker isn't necessarily a panacea for a messy space.

What kylewest said. E.g., I can yap endlessly about real estate and my building in particular, but know I'd be lost if I had to sell my place myself. I'd focus on the wrong things, etc. For one transaction it just wouldn't be worth the trouble, so I'll go with being a PITA client with control issues.

Look at brokers like corporate trustees and executors. They take their cut, but you're most likely better off leaving it to them rather than an amateur.

bramstar: you're absolutely right--a broker can make the exact same mistakes in presenting an apartment to prospective buyers. Sometimes is it because the broker is not doing her/his job well. Other times varying degrees of blame can be laid at the feet of an impossible owner who doesn't let the broker do his/her job. When an owner leaves the place a mess and lets the broker in just 5 minutes before an open house, it is hard to blame the broker if they've explained to the owner that this is a big problem. Regardless, I just found that the turn-offs in open houses occurred at a much higher rate in the FSBO units I looked at. The pitfalls can be avoided, but it takes some thought. Some FSBO's think brokers are worthless and do nothing and that units sell themselves--these same people tend to be lazy or unlikeable or dirty or incompetent during their showings. The smarter FSBO owner studies up on what good brokers bring to the table and then tries to emulate that as much as possible.

I think good brokers do a lot -- but one thing in particular is that a good broker "positions" an apartment -- i.e., if there are ten studios within half a mile for sale, is this the budget one? the one with the best view? the one that gets you started in the best building?

If a FSBO seller can emulate that, and know how his apartment stands in the marketplace, that's a good first step.

ali r.
DG Neary Realty

Thank you all for your postings and info. it it really helpful and ENCOURAGING NOT DISCOURAGING to try to do this FSBO on my own....I will answer some of your comments below individually.

matson jones- Great ideas, especially about a "dedicated" cell phone to this project and not tying up my personal one for this. I agree with one of the other posters however about pictures, website, drawings etc. They can be done much cheaper than you have stated, the market is flooded with people that do this type of work. Is it really necessary for me to do a website though dedicated to my apartment if all of the info. is on street easy, trulia, ny times, etc.?
(Is this because the pictures won't open large on street easy?).

My apartment has always been clean during the time I was having it shown thru my professional broker. I couldn't imagine anyone would do otherwise-I take that back- we live in NY with all sorts of odd people! I wouldn't expect my broker or any broker to pre-clean for me, instead he would make comments after the fact about the way I organized my magazines or furniture! That's fine, one always needs to be open to opinion when making what will be the 2nd biggest transaction of my life, after buying it was the first one.

Hi Ali (front porch)- You make an excellent point about the lawsuit going on in my building and trying to get around that. What my previous broker did was not address it or not claim to know (wrong or right), she left it up to the buyers attorney to find it out and unravel the info.

If I sell on my own I can't say I would be telling everything to a potential buyer if they make no inquiry but if asked I must give the truth. The reality is that many people can still pay cash in this market (lucky them, and an assesment of $ 25,000 - $ 40,000 depending on the way this suit is settled may not be a deal breaker). To those that are having a hard time with the downpayment, you better believe this amount will make a difference in whether or not they purchase.

Why people think a $ 600,000 studio is good as an investment property though is beyond me. You can make more money by putting your cash in a Treasury bond. Do people really think studios will hit the million dollar mark soon, I sure don't. I am a bit leery when I hear potential buyers want my place as an investment.....an investment to break even perhaps! I'm just sayin'..........

damier: I perfectly understand your agreement with ab_11218's (somewhat snarky) observation. In my case, I was FSBO-ing a place that was around $2.5MM, and I decided at the time to start by initially having no brokers welcome (sorry brokers!) on either my sell side or the buy side. Literally direct from seller to buyer. My plan was that if after a month I was having no luck, I would have then welcomed buy-side brokers to expand my possibilities. If after another month or so I had no luck, I would have then selected a broker to market the unit. In my case, it sold in ten days above ask in a bidding war.

Because I was saving 6% of $2.5MM, splashing out a bit to the tune of $2K or $3K total on really top notch professional photography and a gorgeously designed stand alone website seemed like a good investment, and in my case, I feel that both really helped put me 'over the top'. Of course, if you are selling a much less expensive unit, you should be more careful about 'dollars and cents' when it comes to the photography and website design.

But as to photography - I do find ab_11218's suggestion of $200 rather preposterous. I mean, one photographer with no assistant who travels to you with all their equipment, who brings and sets up their camera and lights, who spends a minimum of one to two hours shooting a number of photographs in different rooms from different positions, then packs up all their equipment and travels back to their studio, then goes through all the photos to choose the best ones, lightly edits and tweaks them, and then emails them to you - all for $200? I think not.

Same as to the website design. Setting up the website itself (and there's a modest cost just to do that through someone like network solutions), entering all the text and info, sliding in and optimizing all the photos, designing and sliding in the floor plan, and then tweaking everything to your specs takes more than three hours total. All in all, in took my gal about six hours, including the modest amount of changes and alterations I made after the initial design was complete. If you can find someone to do it for $1K, or $500, that's great.

I think a dedicated site shows again yet another level of professionalism and care in what you do, and I highly recommend it. But again, the math has to work.

With all the pboa over the last few days, going out on the posting limb, 407 PAS here we come.

Daimler -- 2 comments, 1 about going FSBO + 1 about that lawsuit...

You sound as though you have a handle on the practical issues in doing a sale by yourself, but the one thing I would caution a committed FSBO about is maintaining emotional distance not just from the apartment but from a negotiation. Sellers and buyers frequently say things to each other that piss off the other side; if said to/through agents, the impact can be ameliorated; if said directly, maybe you will feel insulted enough to blow up a deal, or maybe not. I have definitely had deals that my side wanted to walk away from, but were persuaded that what they *really* wanted was to do the deal and be done. They might not have stuck with it if they were representing themselves. (Just a warning; you might well not have this problem.)

About that lawsuit... if I were involved in a sale in your building I would tell any interested buyer that there is a complication they will learn about in Due Diligence *and* that the contingency is already priced into the asking price. (And then answer any factual questions you know answers to.) I would never want a buyer to be surprised by bad news, but to know about it before s/he bid. Otherwise, they do what your buyer did ... low ball and threaten to walk away. I'd worry about that if I were you (and no, there is no prohibition about you disclosing the existence of the lawsuit).

SMattingly- Very good advice. I know what you mean about the emotional side of the negotiation (any negotiation) and it's more personal as it's my home. But if I can save Thirty Thousand Dollars I can toughen up and take it!

I like what you had to say about the lawsuit and disclosure. I wish all brokers were as honest and upfront......mine (being a friend) had a conversation with one of her bosses about it who advised her NOT to bring it up and worry about it later! (and this is from one of the top 5 R.E. brokerage houses in NYC). All about closing the deal, never mind the facts, the waste of time, the money I would spend and the buyer to engage our lawyers, etc.............doesn't that sound a little dishonest and perhaps for lack of better words, sleazy??? Everyone come take your piece of the 6%, the clients who we care so much about, oops, did we really say we cared about them, lol lol ! Sorry, but true.

Where do I sign up to be the buyer of THIS apartment?

$23 million lawsuit in the building with $750K already spent on legal with no settlement.
FSBO seller thinking he saves all of the money instead of a win-win also benefitting the buyer.
To top it all off, the seller hopes the buyer doesn't hire a lawyer who would naturally learn about the lawsuit, so isn't inclined to disclose the lawsuit to the prospective buyer unless specifically asked.

Sign me up for the open house! I'm coming WITHOUT a broker. Or a brain.

huntersburg- There are several apts. for sale in my bldg, from $ 575,000 to nearly 3 million dollars.

I never said I hope the buyer doesn't hire a lawyer who would learn about the lawsuit, if there lawyer finds out , it's their business and what they are paid to do. My LEADING BROKERS BOSS TOLD HIM to tell nothing to any potential clients interested in my apartment. The brokerage house is one of the top 5 in Manhattan! So, you tell me how you would handle this................I 'm not looking for smart ass remarks, I'm looking for intelligent conversation to help me in this difficult situation and if you can contribute to that, it is greatly appreciated.

Huntersburg your interpretation is way off base and any other readers who have followed this thread should understand the complexity of the situation . I am in living in a great building (a very upscale building), that has a very big problem we are dealing with in the coming months.

>I'm looking for intelligent conversation to help me in this difficult situation

But you previously said you wouldn't disclose the material lawsuit in your building to a prospective buyer. So basically you want "intelligent conversation" that validates your lack of ethics in business dealings. And your defense is that your former broker's boss said that it was ok.

The issue with FSBO, is not getting enough traffic to see said unit. Craiglist and FSBO sites will become a joke very quickly. The back door to MLS is through FlatFeeListing.com. Cost is about $350-$500 on your side to get your listing poste to 50+ websites. If you want to work with buyers broker that will see your MLS listing, pay 2%, that solves your 6% commission issue (which I agree with) and drives lots of traffic which you'll need. My two cents.

huntersburg- I didn't say I wouldn't disclose the information about the lawsuit if asked! That would be totally unethical. But do you expect me or any broker to volunteer that info. as part of a sales pitch??? of course not. If asked the questions I will answer. Do you think if I have neighbors that smoke marijuana every night (which I don't), I would volunteer that to a potential buyer because they would smell the smoke? At some point the buyer does his job, the seller does his job, the broker does his job (if you use one), and the lawyer does his job. All of that became very apparent to me after all of my postings and answers.............You seem to want to "bait" me to the readers which is fairly obvious. I have total ethics in business dealing, most of the brokers could learn a thing or two about ethtics from me. I am not defending my former brokers boss, I am pointing out what one of the top 5 brokerage houses, VP's told my broker how to handle the question about the lawsuit in my building. I NEVER SAID I AGREED WITH IT....... Please be a little more careful in your accusations before lashing out, you are way out of line here and totally incorrect.

Tallisman- great idea. I didn'tknow of Flatfeelisting.com but will certainly check it out.

Geez damier...Sorry, but I think you should tell any serious potential buyer that there is an issue about the lawsuit and you should say that prices in the building already reflect that risk (which is what I interpreted mattingly to be saying). I wouldn't feel right selling an apartment with that kind of potential liability and not disclosing it prior to agreeing on the sales price. Other issues like view or noise are a lot more subjective than a lawsuit. Of course, the buyer would hopefully find out on their own through a broker or lawyer but nevertheless I think selling it without being honest on this is sleazy. I'm sure some people will say buyer beware but this is just basic ethics I think.

buyerbuyer........i hear what your saying and in the context which you put it, I don't have a problem talking about it. Should it be said the moment someone comes to see the apartment? no, but when someone gets serious about it, I don't see why not to discuss it and like you say, you simply tell them that the price is reflected in the risk. (good idea).

Folks, I'm feeling my way thru this before I am even doing a listing, so am taking your comments as advice as will use some of them and some I will not about a myriad of ideas. That's why this forum is great. It's a great leap for me to have a "divorce" from a broker, and the general consensus is telling me to jump in and try to sell without a broker, it's not rocket science! (No offense brokers, you do serve a purpose for many, but it may not be the necessity people think it is for everyone).

But why do you think the so called "ethical brokers" that have discussed the situation in my building DO NOT want to bring it up? What is your response to that? That can't be condoned if a FSBO says something but a broker doesn't?

"$1K for a photographer? did they shoot your wedding for 5 hrs? It takes just about 1 hr to take quality pics of your apartment and there are plenty of photographers in the city who can do the job for $200."

And my niece can do it with her iPhone for $50.

You get what you pay for.

And Kylewest nailed it: FSBOs are almost uniformly weird people. Selling your own home, while in theory sounds like a good idea, is usually done by people who just off their rocker enough to think their way is better than the norm.

Like people who home school their kids and only flush after a #2.

damier, bottom line, you are not forthright and ethical in your business dealings.

And you justify it twofold:

1 - you won't volunteer material information, but you'll answer a question if asked.
2 - a broker you worked with had similarly questionable ethics, so you are not alone.

Good luck.

huntersburg- Corocoran vps told their selling brokers not to say anything about the financials in my bldg unless asked, I am sure the other "leading" brokers would do the same, they all just want to cut a deal. Very few brokers care about how the money is coming to them, as long as they get it.

I said it once and will say it again, I would tell a prospective buyer about it if asked OR if they are serious about it. Get real, you don't tell every proespective buyer about everything you think is great or flawed the moment they walk in the door, you would be out of your mind and never make a sale.
I have nothing to hide, it's about the time to do it.

NYCMatt- Your comments are crude and absurd above. YOU MUST BE A BROKER.

I'm not responding to any more postings on this topic, it has gone from intelligent to inane. I got my answers early on. Any more nasty crude remarks will be sent to my pals at Street Easy who can suspend your account.

Thanks to all that have been of intelligent help.
Don't question my ethics, you don't even know me except for postings on an anonymous board and I won't question of how much a moron I think you are either. Fair enough?

In a technical sense, daimier, you are likely correct that you need not disclose anything you aren't specifically asked but upon being asked you must answer truthfully, although even then only a directly responsive answer is required--no discourse is necessary.

That said, play it out. You get a bid the you accept, and the due diligence process begins. Prospective buyer's attorney finds out about law suit (I haven't followed all your posts so I don't know what that law suit is) and tells buyer of risks. Buyer refuses to sign contract. You end up back at square one and have wasted a couple weeks dithering with a deal that was predictably going south from the beginning. If the buyer's lawyer somehow misses this giant red flag, it'll turn up later when the bank/appraiser/etc do their jobs; then the buyer will go berserk and possibly sue the lawyer, you, any broker involved until everyone says take your deposit and go home because the cost of litigation and time delay isn't worth it. Either way, you lose. Don't do business this way. Be up front. It's coming out one way or the other. [Now I'm dying to know what this law suit is...]

you already know that no one can get a mortgage in your condo. by putting in Cash Only will bring the right buyers to view your apartment.

NYCMatt, my friends are free lance photogs who shoot manhattan weddings with an assistant for $650 for 6-7 hrs. just because the firms that hire them charge $4K, does not mean that that's what goes the photographer. most of those photogs also do school shoots just to make a little more money. they get paid $3-400 to spend the whole day with the kids. your niece would be paid about 50 cents and if you show up, make sure you come with $100 in your pocket as idiots that are on boards in Washington Heights are never welcome.

I sold 2 studios without a broker. I had no problem. Maybe I am a weirdo according to a few on this thread. They weren't multimillion dollar apartments and they weren't staged - then again this was 2000 and the 1990s. It wasn't difficult at all. I had brokers as well but no exclusives. What is most important, imho, is a great RE attorney. Lucky for me my best friend is one. So I was set. I was also lucky the second them because my neighbors really wanted it for a combo. They didn't want to pay my price which at the time was 35% more than any studio had ever sold for before. They saw a few people come and view the apartment and gave me my price ASAp. Lucky me. Anyway it can be done.

cc harley- Great positive advice. You have to consider the source of those who write demeaning nasty unwarranted comments on a board such as this, I pay those fools no mind and the readership knows better. You have given me more hope in trying to do this, I have a GREAT apt. , the brokers brought constant traffic, but trying to sell in a recession along with a pending lawsuit has it's own set of issues.

ah_11218- You have a good point. It is not impossible to get a mortgage here now , just difficult. The leading banks will not give a mortgage here because of the problems. I am told thru smaller mortgage companies (perhaps with a higher rate it is possible). I am also living in what is considered an "upscale/lusury" building, so I am sure many of the owners were able to pay in cash. Lucky them. I suppose in my ad I can make some sort of reference to Cash as you are correct, they will bring the right buyers, and if they are bluffing, I will do credit checks on each one anyway and will know fairly soon if they really have the capital to pull it off. Good point!

if you think that some banks would give mortgages, contacting them (GFI, etc) would be great. you will then know what the rate difference is and what down payment requirement is.

it will assist you in selling by saying 30% down required or 50% down rather then having to say all cash.

in terms of checking if the cash buyer has the cash, this gets a little tricky. when i was selling my place, i required a review of financials as it was a coop. some people were against it. i suggested that they can send the info to my attorney with a pre-approval letter (not a pre-qual, as it's worthless). they should feel more secure that the data is going to a professional.

- if no one can get a mortgage in this building doesn't that mean there will be a very large discount to comps in the area?

- if this inability to get a mortgage is recent, then doesn't that mean the value of apts have dropped quite a bit more than the average man. apartment (more than the 20% or so in manhattan in general)?

- if the inanability to get a mortgage is temporary (is it because of the lawsuit only?...or what)...then doesn't that make this a foolish time to sell (and good time to buy)?...

I'm with Sandy and Kylewest -- if there's an impairment, you disclose *as early* as possible. I'm astounded (OK, I'm not) that Corcoran brokers aren't doing this.

Here's the reasoning: Buyers who are scared off by your immediate disclosure wouldn't have the stomach to get all the way to closing anyway.

More experienced buyers will trust you a little more, and it will ease the rest of the process.

ali r.
DG Neary Realty

to buyerbuyer- It is possible to get mortgages for this building but thru smaller mortgage brokers. The big banks are saying "no". Comps in this area are not lower, if anything they are higher! I am in a rather costly area of midtown real estate, the average per square foot is $ 1000- $ 1200.00 .

The value of the apts have dropped about 10% in the last year I believe due to the recession. The interesting thing is although the lawsuit has been going on for 3 years, now it's being taken my seriously as a court date is approaching. Like many things in life, you can say, "that's next years problem". Well, now it is staring us in the face so to speak.

Yes, we all believe this could be a temporary thing about the mortgages once the lawsuit is settled. It is a great time to buy (prices are lower in the bldg, and I am sure some owners have had to come down a bit for a "worst" case scenario with the lawsuite. For a seller, it's how you view it, for some sellers the idea of having to fork over an addl $ 25 - 40 G if we lose the suit is not a big deal at all if you are selling a 2 million dollar apartment. That is not so in my case. I am just anxious to upgrade my apartment either within or outside of the building. Who knows what prices may be like in a year from now.......I think it's a bit of guess work.

Ali,- (front porch)- You have given me some very good food for thought with your comments above, thank you.
I'm afraid many brokers would not take the high road the way you have, but if I sell as a FSBO I need to be prepared to talk about it, as it is the right thing to do.

Being prepared to talk about it is a few shades different from voluntary upfront disclosure.

The truth about doing a traditional FSBO is you can't get full buyer exposure. Because it's not in NYC's equivalent of the MLS which is RLS (REBNY Listing System), you won't get the attention of the three quarters of buyers who are running around with buyers' agents. Have you considered an agent managed FSBO yet to get around this issue?

Inman broke the story recently on how FSBO sellers are getting around this issue without paying 6%:
http://www.inman.com/2016/07/25/the-underground-for-sale-by-owner-movement-in-nyc/

I started RealDirect to give sellers the flexibility to get the cost savings of a FSBO, but the expertise and distribution of a licensed broker. We launched in 2010 and have sold hundreds of homes. The NYTimes reported on it in 2011 http://www.nytimes.com/2011/01/30/realestate/30cov.html . While using our Owner Managed service is not for everyone, if you have the time and the ability to sell, we can assist you so that you get the highest possible net proceeds from your sale by reaching every possible buyer - direct as well as agent represented, and guide you all the way from photos to closing. Here is some more on the topic: https://www.realdirect.com/blog/buying-selling/how-to-fsbo-in-nyc/ .

I can't speak to a condo in Manhattan, but I can tell you that in our market (northeast Ohio), sellers consistently net more money (even after commission) listing with a great realtor. Most realtors aren't great, and you'll likely do better as FSBO than you would listing with a no-value discount broker. But if you take your time and find a great realtor, you will do less work and walk away with more at closing. You can see our listings here, many of whom were form FSBOs: https://www.expertrealestate.pro/orange-village-homes-for-sale and https://www.expertrealestate.pro/boston-heights-homes-for-sale

Not sure if anyone is still reading this thread. If so, here are a few more examples of our former FSBO listings. You can see how much more cash these sellers are netting by listing with us than by trying to do it on their own. I'm happy to provide specific case study examples if you'd like to see what the real seller net sheets look like on these:

https://www.expertrealestate.pro/Richfield-homes-for-sale
https://www.expertrealestate.pro/Mogadore-homes-for-sale
https://www.expertrealestate.pro/Peninsula-homes-for-sale

What is the current FSBO market like in NYC? Are sellers trying to sell themselves, or do they see the value in working with a strong agent?

We had a frustrating experience is a FSBO seller today. We met him and the appointment went well, then when we were about to sign the paperwork, he told us he was only willing to pay 1% to the listing agent. smh. very frustrating. Compared to a fb marketplace ad and a crooked red FSBO sign, we give really great exposure - see a couple of examples of the real estate marketing we do below.

https://www.expertrealestate.pro/Streetsboro-homes-for-sale
https://www.expertrealestate.pro/Aurora-homes-for-sale

What is the typical listing commission in NYC in 2023? Do agents offer any discount if they are working with someone who tried to sell FSBO?

I also have a condo question - only a small number of our sales are condos. Occasionally we run into a situation where the condo is non-warrantable (either because the association reserve fund is too low, or there are fewer than 50% of owner-occupants in a building). in these cases, the buyer won't qualify for a conventional loan. with so many apartments and condos, I'm sure this is much more common in NYC. What types of options do buyers have? Are there local or regional lenders that specialize in these? around here, there are very few options, but I'm hoping someone can recommend a regional or national lender that offers these products. Here are some examples of the types of properties i'm talking about:
https://www.expertrealestate.pro/Hudson-homes-for-sale
https://www.expertrealestate.pro/Chagrin-Falls-homes-for-sale
if anyone has any recommendations on this, please let me know. thanks.

I live in an unwarrantable building, the sponsor owns more than 10% of the units and over 50% of the units are rented out. Nevertheless buyers can still access Fannie Mae loans in my building. And that is because every two years the Condominium applies to Fannie Mae for what is called a PERS approval. And of course the renewal should be applied for before the existing one expires.
Many condominiums, co-ops too are not aware of this process. The first step is to get a prospective buyer pre approved, but not for the standard pre approval, but for an underwriting pre approval. As a mortgage broker I do these types of pre approvals for the borrower, however the PERS approval has to be done through a lender as the go between for the condo or co-op and Fannie Mae. It is well worth it for an unwarrantable building if eligible to apply for the PERS Approval as it makes the building and the units more valuable.
Ellen Silverman
Mortgage Bkr,
NMLS#60631

Hi somervdc!

1) we can't discuss commission broker-to-broker; that's an antitrust violation. Perhaps one of the nonbrokers will discuss it with you.
2) About half the sales in my market are all cash, so something being nonwarrantable isn't that big a deal.
3) There are lenders who will make loans that they don't sell to FNMA or similar. The lenders instead keep the loans in their portfolios -- so we call them "portfolio lenders." Rates vary.
4) Market here is pretty lousy. People FSBO for all sorts of reasons, but they tend to FSBO when the market is stronger ("hey places are selling themselves, why should I pay a broker?")
It might be a smart play to FSBO and cut the listing price by the amount of brokerage commission, but first, FSBOs don't tend to think that way and second, apartments are so expensive that a cut of that size is actually rather nominal.

ali r.
{upstairs realty}

Agree with @front_porch @huntersburg @buyerbuyer that it would be unethical to be upfront about the legal issue. To say Corcoran is advising brokers not to mention it is whataboutism. You're a person before you're a seller or a buyer and the old 'do unto others' still applies. Maybe I'd find out about this eventually through due dilly but it would amount to a waste of someone else's time and money.

unethical _not_ to be upfront about the legal issue

If a building is unwarrantable regardless if one is paying cash for the unit, being unwarrantable is a big deal; cash buyers by and large want to make good investments. And the board of an unwarrantable building should be addressing this problem. Buyers or their attorneys should beware. Portfolio lenders not only charge higher rates, but the loan itself could have unfavorable terms.
Many cash buyers after closing do apply for a loan to get their cash back; it’s called delayed financing.
As a real estate broker I advise my clients about these issues.

Just saw this article:

https://cooperatornews.com/article/is-your-condo-on-fannie-maes-blacklist?utm_source=newsletter776&utm_medium=email&utm_campaign=newsletter&npe=n776-1236514

@streetsmart, so there's a secret list of Blacklisted condominiums which Fannie Mae has created but they say doesn't exist?

Okay, a bit "conspiracy theory," but for purposes of this post, let's roll with it...

But then this law firm (which, btw, is not a NYS law firm) won't release it, but will tell you, if you write them and they capture your personal information as you ask, if your building is on it?

This feels really really fishy to me, even by expanding "how attorneys advertise" standards.

ali r.

@front_porch
I quoted the link to the cooperator as an afterthought. Nevertheless the Cooperator serves the condo and co-op community for a wealth of pertinent information. But let’s not pivot. Being an unwarrantable building is a big deal as I mentioned contrary to your assertion, not just for people getting loans from Fannie Mae. When borrowers apply for jumbo loans, lenders including Wells Fargo require the jumbo loan to conform to Fannie Mae standards in order to be sold on the secondary market. This matters even to all cash buyers.
Why not contact the Cooperator about you musings.

@streetsmart, they're not "musings." They're observations on the way the Manhattan and Brooklyn markets work, based on decades of living and working here. I am tired of the constant hype on one side -- the market is terrible right now and I'm sick of reading through dozens of broker emails pretending otherwise -- and the "sky-is-falling" on the other. Many people in New York live in unwarrantable buildings -- you yourself have said that you live in one.

What consumers want is information, honest information. If the market is terrible, say so. If a building is unwarrantable, let them know that. It's really not that hard.

@front_porch
My building has a PERS approval as mentioned which means that Fannie Mae does finance in my building. I would not live here if this wasn’t so. Many buildings can get a PERS approval, but they do not do their research.