Slow Mid Summer Market - FSBO

you can list directly with streeteasy assuming you sign up on the site as a broker. just get a website for your property with some pics and contact streeteasy.

A few suggestions:

1. Post on NYT online (a few hundred bucks in advertising is clearly worthwhile).
2. Craigslist is more helpful than you think if you clearly indicate that it's a FSBO and tag it as such (there's a separate category of by owner sales on CL.
3. I think I've seen some FSBOs on streeteasy linked to NYT ads.

Good luck!

NY Times is the best way. there is also a site called fsbo.com or something like that.

I'm no expert (and perhaps other people can chime in) but I think the problem that you face is not necessarily the lack of advertising from a seller's broker. Yes - a seller's broker will do marketing for you but, I think, generally, by posting it yourself on NYT, Craigslist or Streeteasy, you will hit the same pool of people. The people who are saavy enough to look on Corcoran's or Halstead's website are saavy enough and will generally also look at the listings on NYT.

What I think you are missing is the pool of people who have a buyer's broker and aren't saavy enough (or don't have the time or inclination) to look at listings online on their own. The buyer's broker isn't going to show them your property if they're not going to get a commission on it. So, rather than go out and get a seller's broker (which will generally just market to the same group of people you can hit on your own by listing on NYT and Craigslist) you might want to consider giving a buyer's broker a commission if they procure a buyer.

No great revelation that you've discovered the market is "monopolozized" by brokers. Depending on which accounts you want to believe, Real Estate brokers account for somewhere between 85% and 95% of sales. And, depending on the market, perhaps as many as 80% of FSBO's eventually turn to a broker, though clearly an owner may be less inclined to go that route in a strong seller's market, such as we experienced through most of 2005.

Craigslist is "cluttered", but it is free. And you can certainly post multiple ads in slightly different formats. Yes, the NY Times will cost you, but it is THE source for online apartment searching. If there are Sunday Open Houses in your building of comparable apartments, you can try to "button-hole" prospects in the lobby as they're looking at other units. Yes, it's an effort and it is time-consuming, but it's one thing I've seen FSBO's do to help move their apartments.

I won't try to convince you of the value of using a broker, or what the service is (or isn't) worth. But it's certainly not a day or two process. I'm a broker who works only with buyers (typically for entry level Co-op's), and mine is an ongoing process which includes research, negotiation, dealing with the listing agent, attorneys, lender, appraiser, management firm, Co-op Board, etc. - and preparation of the buyer's Board package - in short, managing the transaction through an approximately 90 day process. Listing (seller's) agents have their own tasks to contend with - and their own costs (e.g., NY Times ads). And I can't tell you how many times I've seen the same agent at the same Sunday Open House for weeks at a time, watching over an apartment that isn't selling.

Exposure aside, the main reason FSBO's run into trouble is price. Many brokers have agreed that your apartment is properly priced - is that a FSBO price or a broker listed price - they're not the same. A broker price includes the fee to compensate the (usually) two firms and two agents for the work outlined above - a FSBO price doesn't. An informed buyer will be resistant to pay a seller's FSBO price unless he / she "shares" in the savings - "splits the difference" on the saved commission cost - otherwise they may just as well work with a buyer broker. After all (in the buyer's mind) - why should the seller get all the $$$ benefit of a broker-free transaction?

"A broker price includes the fee to compensate the (usually) two firms and two agents for the work outlined above - a FSBO price doesn't. An informed buyer will be resistant to pay a seller's FSBO price unless he / she "shares" in the savings - "splits the difference" on the saved commission cost - otherwise they may just as well work with a buyer broker."

Yes, and anyone with an opposable thumb can establish what that broker "piece" is and apply a portion of it to the FSBO price. Perhaps in the high(er) end market you guys are useful, but in the middle and low end, brokers are not worth the cost.

I sold my place without a broker. First thing I did was use Craigslist. A few people came but no one serious. Then I knocked on the doors of my neighbors to see if they were interested and put a sign up in the common area (laundry room is a good place). There are plenty of people in the building that may know someone who is looking for a place (mother, friend, etc) so word can spread. I ended up selling to my next door neighbor who was renting and her landlord wouldn't sell to her. If I didn't sell to my neighbor, I was going to put an ad in the NYT. If you price it right, then you should sell it.

I was selling a studio though in Tudor City. The combining unit idea with your neighbors usually works with studios better.

And the advice would be: include a line in your advertising about you working with buyer's brokers and compensating them for bringing you a buyer. It would widen your pool of potential buyers.

elena
(broker)

If you agree to work with buyer's brokers on an FSBO, memorialize any agreed upon fee in writing. Do not simply "trust" them or leave it to an oral understanding.

johnrealestate-

Thanks for you comment. You've haven't told me anything I don't already know, though. The statistics you've provided are irrelevant because they are developed by brokers in a system built by and for brokers. I would expect nothing less than 95% sales attributed to brokers. Under a different (more open) system that statistic would change drastically.

I have in fact piggy backed on other open houses in the building, and the broker practically covered my sign in the lobby and tried to confuse visitors that his was only one open house in the building.

Thanks for the try, but you did in fact attempt to convince me of the value of broker services. I am totally aware of what you do, and believe you should be reasonably compensated. However, please see this link (http://www.streeteasy.com/nyc/talk/discussion/1699-for-sale-by-owner-co-broke ) for what think about the industry and adequate compensation, if you are interested.

As far as the price : I believe that people are hesitant to deal with FSBO's and cannot review or confirm an offer with a broker because of the way the system is set up. Anybody can walk into a car showroom and offer something low, without feeling like they have insulted the salesman, and walk away. My price is set within negotiating parameters. And...I expect both the buyer and the seller to benefit from the lack of broker commission built into the price. But if nobody is willing to work with a FSBO, then who cares what the price is. Traffic is key. The more people see it, the more I can find that one person who is the right fit for the property.

Anyway, I wondered if there was a way to get brokers to bring more buyers. And, I am hesitant over open listings. Don't really know what the motivation is since all other brokers want the exclusive. My guess is that the market is slow and they will take all they can get. I need the traffic that the big three can give me, not some small neighborhood shop.

This is a good piont clear_vision. I am looking online at a FSBO apt. in Concord Village and I am reticient to deal directly with the owner for fear of insulting him. Why is this?

babsie02

Look, they want offers. If it isn't right, they'll say so. If they want to entertain you, they should counter offer. You don't like it? Walk away. End of story. Period.

It's not like they will remember you the next time your waiting in line at the local coffee shop. And even if they do, Who cares? Business is business. If you were in real estate for a living dealing with commercial clients, then I can see you might develop a reputation. But seriously, in this market? Buying your own home?

how can the nytimes be costly , if brokers charge 6%.... nytimes is a deal....have a open house every sunday and you will sell your apt............i sold fsbo and i sold in 1month. brokers in the city are useless for the amount they charge........6% is a joke

clear-vision, the NYT online only worked perfectly for me. I had 4 open houses until the valid offer popped up and closed within 5 weeks. The brokers behave as if they were indispensable, like doctors or lawyers, and I believe everyone should do their best to eliminate them as profession (they are not — it's occupation). The brokers should go back to where they started, i.e. being a service provider, not kingmaker. NYT online ad is about $150, renewable and editable.
Brokers do the same thing: place an ad in NYT and have open houses for you. You can do it yourself. Do not allow yourself being bullies and intimidated into paying a middleman for nothing. The mentality has to change. We as society allowed the middlemen rule our lives on every turn. Enough.

babsie02

That advice is given with the assumption that you will make a reasonable offer. Anything more than 10% is not worth the effort- in my opinion anyway. Besides, if you've done your homework, you'll fall within at least that. Ask others here if that makes sense.

babsie02 - I agree with clear_vision about submitting an offer. ANY apartment is only worth what it's worth to you - there's no such thing as a "fair" price. Assuming that the apartment is "rationally" priced, and your offer is "in the ballpark" (say, 90% or more of ask), you should get their attention, and expect a counter-offer. If they're overly sensitive, no harm done - just walk away.

FYI - in the Co-op world, it's not all about the price. A lower offer from a more qualified buyer may carry the day over a "marginal" buyer.

clear_vision - interesting discussion. Please understand that since we're on a discussion board, I'm trying to tailor the conversation to all participants; you may be more informed than most and I may not be telling you anything new.

I'll differ with you on the fact that the vast majority of sales being broker sales is irrelevant. It may not have much relevance to you, but it is a fact that most sellers use brokers. I have to believe that for MOST people, their belief is that they'll net more $$$ and / or avoid the hassle of selling on their own, not that there is a vast broker conspiracy locking out people who want to sell on their own. The fact that some people, as attested to on this board, have successfully / easily / profitably done that, shows that it can be done.

I understand that there is a bias against brokers on this web site - got it. I know that some posters think brokers are way overpaid for the work they do - got that, too. Where I'm having trouble is correlating the disdain for brokers with the fact that they're not bringing buyer clients to FSBO's.

When you say "nobody is willing to work with a FSBO", and I assume you mean brokers, that's just not true. Craigslist is full of FSBO ads that offer to work with buyer agents, at either a posted commission rate or something you can discuss over the phone. And many agents will be interested, if the apartment (and the price) is compelling. Don't quite get your hesitancy over open listings - which is really the same thing. You won't get the same traffic as you would with an exclusive - but you'll get some. You're right - many agents that contact you are looking for an exclusive - but many will just be looking for a good apartment for their client.

I sold my apartment FSBO. I posted an ad on-line in the NYTimes as well as posting a flyer in the mailroom of our building. I had great pictures and great materials that I developed myself. I also entertained buyer's brokers and was willing to pay them a commision. In the end, I ended up selling the apartment to a couple who's best friend's lived in the building. They saw the ad in the loby and liked the fact that they were going to share on the savings of the brokers fee. I would highly recommend going without a broker. The NYTimes is great for visibility. If you have a good apartment and you price it right, it will sell. The nice thing about not using a broker, it gives you a lot more flexibility in negotiating the price.

Unfortunately, a lot of FSBO properties are priced same/higher than comparables. The FSBO is trying to save the commission to put it in his pocket. Combine that with little or no marketing, it makes it a tough sell. If you want to sell fast as a FSBO, price it 7-10% under comps and you would have better luck selling the property and in the end you would probably come out ahead than if you used a broker.

johnrealestate.

I understand your position, but lets go through the numbers. Lets assume for the sake of the discussion that there are 10,000 brokers in the city. Take away half because they are either incompetent or deal only with commercial properties. That leaves 5,000 of which I will remove half because they are currently dealing with 2 BR or larger. If each that is left over has maybe 5 clients looking for studios or 1 BR, that makes a possible 25,000 prospective buyers. Now I understand that the math may not be totally accurate but even if it is remotely close, explain to me why I've only had 2 brokers come with buyers, and one was a walk by. The numbers just don't add up. Every broker I spoke with with the exception of one out of hundreds could not come up with an answer. The one that did outlined the three reasons I listed earlier in the other linked thread.

As a short and informal survey, all posters in three threads here that sold as owners, most have not sold through a buyer brought by a broker. It may have happened, but even as you say, it's only the remaining 5%. Most sellers use brokers because it's the only game in town, and don't have any choice. Those that do, usually have bad experiences with brokers and are stubborn and non conformists that believe the whole system is, well, fixed to create a business that is not necessary -let me be clear -for sellers that want to do it themselves. If I don't want to deal with it, great. I'll hire someone and accept the terms and conditions. Just don't get in the way of others, which is exactly what the NAR and the broker system does.

This was my biggest mistake, and if I were to give advice to others, I would suggest not to expect brokers to bring buyers, and if they do, they are bringing their drinking buddies to prove to you that they have a good client base.

I did not sell my apartment to a buyer with a broker. I also networked in my building and sold it to someone already living there. If you think of all the people in the building who have friends and family they would like to live close to them, you have a wealth of opportunity right there!

clear_vision,

I tried a FSBO last year for a condo I owned. I gave myself 2 months at the beginning of the spring season to find a buyer. I did nytimes (set up a dedicated email address as you will get lots of unsolicited emails from brokers), and I also did some mass mailings to residents of buildings in the area. I got quite a few calls, but no serious offers. I then gave the listing to a broker friend who had us in contract in a month, at a price higher than I thought we'd get.

In hindsight, I am glad that I did give the listing to a broker, b/c the buyer was a foreigner - and I don't think I would have been able to reach this buyer through the means I used.

I think it depends on your particular apartment and where you think the likely buyer will come from. It can't hurt to give it all you have got, but maybe give yourself a timeframe and then give it to a good broker (assuming you know one?). I would definitely go with one of the biggies - corcoran or elliman as their websites get a lot of traffic.

I definitely would recommend doing mass postcard mailings. It really did not cost that much, and I did get a lot of calls from interested parties.

Thanks surdy. I think at least I would be able to engage in some sort of negotiations or back and forth. I think people are looking for a deal, and expect more than 10% reduction.

Love how people expect FSBO to be easy.

Clear_vision

I should have made it clear- The asking price should be 7-10% below comps to catch the attention of buyers and then it's up to the market and your negotiating skills to finalize on what the selling price will be.

ootin =REA/B

Well, it can't be any tougher than a broker trying to sell it. It's not like brain surgery where one has to study for it. Six months of mumbo-jumbo does not make a professional.

You need to snag the first buyer looking to buy your type of property as waiting for a second one in this market could be long and futile.

For pricing- you need to be aggressive and ahead of the curve and not merely playing catch up to future price drops that for sure might be coming to a place near you.

clear_vision - numbers it is.

The number of additional buyers brokers will bring is large, but smaller than you suggest. Some are holding their license for convenience / keeping their options open, some are part-timers, some are slackers, most specialize by price / buyer type (mine is first-time buyer, co-op's, high 200K's to mid 400K's), most specialize by neighborhood, some only want to work with sellers, many opt to do only rentals. So the only buyer brokers who could bring you buyers are those who work in your price range, in your neighborhood, and currently happen to be working with buyers that COULD be a good match for your apartment. If a Co-op, the buyer's financial profile also has to be a good fit for your building. Brokers are understandably more comfortable working with other brokers - that shouldn't come as a surprise - than trying to drum up business from a FSBO. And working with another broker can (practically) eliminate the possibility of nasty surprises.

I've heard the argument that sellers avoid brokers because they've had a bad experience or they're non-conformists - but it's usually about the $$$. Everyone enjoys a bargain - I certainly do. And for those with the time, energy, and inclination - and a bit of luck - going FSBO can be an attractive option.

I'd be interested in how you've conveyed to brokers that you'd be interested in working with them (meaning, of course, that you'll pay them a fee (typically 2% - 3%) to bring you a buyer. Most brokers avoid FSBO's, since they assume, usually correctly, that they're not welcome. I understand in the go-go days, brokers pursued FSBO's, because the broker inventory was flying off the shelves. That's no longer the case - my broker database may have info on 20 or so listings that are good matches for one of my buyer clients. Since I can only comfortably schedule two or three appointments at a time, why would I want to bother contacting a FSBO, who most likely doesn't want to hear from me? Bottom line - MOST brokers won't spend time soliciting FSBO's - if a FSBO wants to work with buyer brokers, the burden is on the seller (through CL or similar) to reach out to the brokers.

johnrealestate-

You summed it up with one sentence.

"Brokers are understandably more comfortable working with other brokers - that shouldn't come as a surprise - than trying to drum up business from a FSBO"

I understand you have to make a living, but you need to act in the best interests of the buyers and the sellers, not your business. That is the biggest problem. Brokers will ignore a good fit because it might be bad for his business or because it isn't easy.

clear_vision - A FSBO, by definition, wants to sell his / her apartment WITHOUT the assistance (and the expense) of a broker. If a seller wants to invite the participation of a buyer broker to assist in the sale, he /she has to reach out the broker community (CL, etc) with that offer.

Brokers share listings, with the intent of matching up buyers and sellers. If a broker has a listings database with dozens of listings that could be a good fit for a buyer client, do you honestly think a broker would decide to look through 1000's of CL listings for additional possibilities, in the hopes of finding a wonderful FSBO apartment that just HAPPENS to say "brokers welcome", instead of "no brokers, please"? For better or for worse, FSBO usually means BROKERS STAY AWAY. For me, it's a logical disconnect to state you want to sell on your own, but then be angry and surprised that brokers aren't somehow beating a path to your door.

I've received hundreds of calls, multiple mailers from brokers. My listing was viewed by every brokerage house in the city, and was even listed in multiple FSBO databases compiled by brokers and made available to brokers. They didn't even see the original listing. The large ones like Corcoran and DougElim even have it in their internal system, some of which asked me if I wanted to update it with new information. On every call I agreed to show the property to qualified buyers and discuss compensation. I always left open the possibility to co-broke a deal with who ever brought buyers.

Blaming the seller because they want to minimize the commission in a fixed game is arrogant.

"(mine is first-time buyer, co-op's, high 200K's to mid 400K's)"

where exactly is this market?

Typically, an UES Co-op in a non-doorman building.

Two recent examples:

- A second floor studio in a walk-up, but very nice building, on 89th between Second and Third. Asking was $275K - we got it for $260K.

- A fifth floor Junior-1 in an elevator building on 87th between Second and Third. Initial ask was $344,000, was reduced to $334,500. We got it for $327,000.

do you cover the east village too?

Are there really buyers out there who rely completely on brokers to find listings for them? I don't know anyone who has purchased in the last 5- 6 years who didn't obsessively comb the internet for listings. Sounds like a pricing issue to me.

totally - As a buyer broker, I'm less "territorial" than listing brokers. Though some buyer brokers are (or claim to be) experts in a particular neighborhood, I've chosen to work with buyers throughout Manhattan. I'm a "value" advocate, and the principles are the same regardless of the neighborhood. You can always contact me offline at johnrealestate1@optonline.net.

A little off-topic, but don't you all think the problems with these seller brokers is their sheer number and the competition betwen them? As things continue to cool, what percentage of them do we think will be frozen out and get out of the business?

looking - not very many. Sometimes, my buyer clients will bring listing information to my attention before I see it. Some clients have better things to do than spend hours on the web looking for apartment prospects - others love being a part of the "hunt". As previously mentioned, for those that choose to work with a buyer broker, the value extends far beyond finding and emailing listings. A good buyer broker will:

- Educate first timers on Co-op's vs Condo's, Co-op qualification parameters, etc.

- Research new listings, track price changes on apartments of interest

- Attend Open Houses, schedule appointments

- Research comparable sales of apartments in buildings of interest

- Prepare purchase offer (including letter of introduction and buyer financial statement)

- Negotiate for the buyer

- Prepare the buyer's Board package

- Work with ALL the players (listing agent, attorneys, lender, appraiser, management firm, Co-op Board, etc) throughout the process

- In general, manage the transaction to a successful conclusion

Not all buyers need (or want) this level of hand-holding. But most do.

Re your comment on it being primarily a pricing issue, you are correct.

Also, consider a buyer who "combs" the internet for listings. The vast, vast majority of those will be broker listings - no surprise. And those broker listings will usually have all those bells and whistles that online buyers want - professionally shot photos, floorplans, virtual tours, etc. Most FSBO ads (understandably) don't have anywhere near the same level of professional quality as the broker ads - and that's what online buyers have come to expect.

Combined with my earlier comment that FSBO (usually) means BROKERS NOT WELCOME, and it's no surprise that FSBO's often play to near empty Open Houses, particularly in a weak market. FSBO is a fine option for those with time, energy, and no REAL urgency to sell. It can also be a therapeutic avenue for those that just hate brokers.

"Most FSBO ads (understandably) don't have anywhere near the same level of professional quality as the broker ads - and that's what online buyers have come to expect."

Point of Order. I think that those trick cameras which enlarge cramped spaces don't fool anyone. Saavy buyers know to expect to be lied to as it relates to square footage, morevoer, saavy buyers know all the broker-speak words of puffery are meaningless. I think provided the FSBO is discounted to at least cover some of what would otherwise have gone to the brokers, and assuming the seller has a modicum of staging and salesmanship ability, its fine. of course, most FSBOs do not have any of these abilities and usually price the broker costs into their price anyway because they're greedy.

ta - the main point clear_vision was addressing in this thread was how to get more exposure / generate Open House traffic, not so much the issue of pricing.

If you're looking for an apartment on the NY times site (or a girlfriend on Craigslist), you'll naturally be drawn to those ads that have the best pictures and the most information. While I have seen some cheesy (and distorted) broker photos, there's no arguing that professionally shot photos will show an apartment at it's best, and garner the most attention. Ditto a floorplan. Ditto the gimicky but effective virtual tour.

When the market is tight and listings are few, buyers will often take the time to weed through listings that are light on info. When there are hundreds of listings to cull through - call it what you will, "flash", "sizzle", "puffery", or "professionalism" - you only have a couple of seconds to make your presentation, so you had best do a good job.