$6.16 trillion of homeowner equity in '10 turned into $18.72 trillion in '19. Tapping that equity FSBO is not the way to go...

Homeowner equity in the United States reached $13.27 trillion in 2005. Homeowner equity in the United States dipped to about half of that level five years later - to $6.16 trillion - in 2010, as a result of the Financial Crisis. Homeowner equity bounced back to 2005-levels, reaching $13.24 trillion, in 2016. And homeowner equity reached a jaw-dropping $18.72 trillion in 2019. Furthermore, according to CoreLogic, homeowners gained over $1 trillion in equity in the third quarter of 2020 alone. It's 2021...which means, it's likely time for large numbers of eager homeowners in the United States to cash in on their home equity. And doing so for-sale-by-owner - i.e.: "FSBO'' - would not be the way to do it.

In 2018, for-sale-by-owner ("FSBO") home sales accounted for only 8% of the overall home sale market in the United States...with the average FSBO sale price of a home being $217,900. Arguably, the heyday for FSBO home sales came back in 1987. In 1987, about 20% of homes sold, sold as a FSBO. That was 34 years ago...

As per agent-assisted home sales in the year 2018? The average sale price for those home sale-types - i.e.: agent-assisted home sales - was $295,000. The $295,000 sale price average for agent-assisted home sales being much higher than the $217,900 FSBO sale price, right? To summarize, Realtor-assisted sales of homes have led to, and continue to lead to, more money going into the pockets of United States home sellers. By way of the higher home sale prices Realtors get for their home-selling Clients.

Ok, the $217,900 FSBO sale price versus the $295,000 sale price attained when the home seller uses a Realtor? So then, thinking this through, a home seller "paying commission" would not really be the focal point in a substantive FSBO home sale discussion with a FSBO home seller, right? More money going into the pocket of the FSBO home seller is the key conversation point with the FSBO home seller, and the #1 focal point, right? Yet initial conversations a Realtor could have with a FSBO home seller may oftentimes be, arguably, off-point...ineffectively anchored by the "paying commission" objection FSBO home sellers oftentimes do have. Which is, again, technically, an erroneous process-point for the FSBO home seller to focus on when their goal really is, More money through the sale of their home.

This all being said, how then could a Realtor effectively add perceived value first, and then actual value second, to the FSBO home sale process for a skeptical - albeit, maybe a not-fully-informed - FSBO home seller? The answer to that question? The answer to that question could be, The effective communication to the FSBO home seller of data, results, information, statistics, and, need we say, reality.

One mistake a Realtor might possibly make, when approaching a FSBO home seller, could be, that Realtor thinking they should try to get into a discussion with the FSBO home seller about converting that FSBO prospect into a traditional real estate listing...and doing so very early on in their relationship (often times, on the first call). One could argue, that may not be the best route to take...

If so, the Realtor's idea may be, the conversion of that FSBO home seller into a traditional real estate listing, right? Ok, but how? By simply - i.e.: instantly (??) - transforming the FSBO home seller's mindset - along with their perspective - away from a FSBO, thus putting the FSBO home seller's home onto the MLS? Through the Realtor? That very same procedure being, arguably, exactly what the FSBO home seller thinks they don't want to do in the first place...although that is what they indeed should do in order to sell their home for the most money.

What about having a conversation with the FSBO home seller which is at first centered upon marketing methods? Maybe "marketing" would be a better approach to take for a Realtor who is approaching a FSBO home seller, early on?

How about the proposed utilization of the multiple listing service - coupled to marketing - as integral steps to take for the FSBO home seller who would like to really attain the highest possible sale price when they are selling their home? Higher sale price...more money for the home seller, right?

Multiple listing services are utilized within the profession of real estate, and not only so, in the United States...

The use of multiple listing services started to be used in India in the year 2015. The use of multiple listing services began to be used in Vietnam in 2010. In Israel? The use of multiple listing services began in the year 1990 in Israel.

Multiple listing services are utilized by real estate professionals - worldwide - serving as a good facility for listing brokers to publish "unilateral offers of compensation" to other broker-participants in their multiple listing service. Participation among brokers. More prospective home buyers for home sellers. Agent-assisted home sales lead to higher home sale prices through this proven broker participation method. Leading to, higher home sale prices for home sellers...

The very first Boards of Realtors in the United States were established as what had then been known as "real estate exchanges''. These "exchanges" were established in the late nineteenth century. So, let's dial our date back to the 1880's, and to the 1890's too. When we do that, we will learn that the way these "exchanges'' worked - in late-nineteenth century America - was, on specified days, Members of a Board of Realtors would meet at their local Board offices. To exchange information among themselves about their real estate listings. So then, the exchanges functioned as an auction, of sorts. Members of the exchanges agreed to compensate other exchange Members who helped to sell Members' properties. In fact, Members often came to Board offices prepared to submit an Offer for their Client - i.e.: for their home buyer - to purchase one of the homes being discussed at the exchanges by other exchange Members.

In conversations with FSBO home sellers about actually getting their FSBO home sold - at the highest price - and using time-tested home sale processes to do so, by converting the home seller's FSBO into real dollars for the home seller, it's really "marketing", not "commission", in terms of substantive topics to discuss. Right?

Conversely, as a FSBO, limited marketing, #1, multiple listing services not being used most effectively by FSBO home sellers, #2, and the as-noted lower FSBO home sale prices versus the higher agent-assisted home sale prices, #3. 1, 2, and 3...

So why would anyone - home seller, or Realtor - focus their FSBO conversation primarily on "commission?" More prospective home buyers for home sellers is the goal. And agent-assisted home sales lead to higher home sale prices through this aforementioned broker participation methodology. Cooperation. 

So let's look at this "FSBO market space" a little bit more closely...

Let's first go back in history once again. The year being 1907. 1907 would be the year the term "multiple listing" was first used by real estate boards in the United States. 1907...yet it took another 15 years or so for the term "multiple listing" to be widely accepted among real estate boards in the United States. With this slow historical progression for the "multiple listing", then certainly - looking at FSBO home seller perceptions - it can reasonably be appreciated that the term "multiple listing", and the benefits for FSBO home sellers of utilizing multiple listing services, has not yet been widely-accepted by FSBO home sellers, right?

So while utilization of multiple listing services would be the correct process - for Boards, for Realtors, and for FSBO home sellers - it took Boards about 15 years or so to use the term "multiple listing" in an expansive manner. Those were real estate boards. So why would a FSBO home seller in 2021 - at first glance, right off the bat - commit to adopt the need for them to utilize a multiple listing service early on in their relationship with a Realtor? Just because it is smart for the FSBO home seller to do so? They may not come to that viewpoint...early on. And we know that 46% of homes sold as FSBO's in 2018 - nearly half of all FSBO homes sold - sold with the home seller not even marketing their homes as a FSBO at all. No marketing...

As of 2020, there were 580 multiple listing services in the United States. Bright MLS is the largest MLS among them, with over 95,000 Members. The Heartland Multiple Listing Service in Kansas City has over 7,000 Members. The California-Regional Multiple Listing Service has over 81,000 Members. Interestingly, in the largest borough of the largest city in the United States - Manhattan - the multiple listing service format has never taken hold. In fact, in Manhattan, real estate listings are managed by the Real Estate Board of New York. The Real Estate Board of New York is a non-Realtor entity which left the National Association of Realtors in 1994. In Manhattan, the Real Estate Board of New York operates a database, the REBNY Listing Service.

One value-add for our Team With Heart FSBO home sellers is our Team's use of video. Such as, 24/7 access to open houses. Aerial images, since homes marketed for sale with the use of aerial images sell at a pace which is 68% faster than homes marketed for sale without the use of aerial images. Ok, so why then would an emphasis be placed upon the use of video to sell a home at the right price?

According to The Wall Street Journal, home buyers spend 60% of their time looking at photos of homes...and only 20% of their time reading the listing description for that home they are looking at. Virtual reality tours. 3-D interactive tours. Virtual staging...and remember, 95% of homes sell in 11 days or fewer when the homes are staged. 3-D walk-throughs.... It's visual. It's the Internet. It's the experience, online, for prospective home buyers.

So, let's go back once again to those FSBO home sellers. 46% of whom do not even market their homes in the first place. No marketing. But let's say, for argument's sake, that those FSBO home sellers actually do market their FSBO homes. OK, then what?

Well, only 6% of FSBO homes which do sell, sold through multiple listing service utilization. Pretty low...6%. And the use of multiple listing services for home sellers is key. So let's then look at some additional FSBO home sale statistics...

How about FSBO homes sold by way of the use of print ads or newspapers? That would be, only 1%. How about FSBO homes sold through open houses? Only 11%. How about social media, such as Facebook, or Twitter...? Only 14%. How about FSBO homes sold to friends, relatives, or neighbors of the home seller? Only 22%. So, let's assess here. 36% of FSBO homes which actually do sell, sell by way of the FSBO home seller either knowing someone who may want to buy their home, or through social media. Yet, on average, the FSBO homes still sold at sale prices which were only 73% of the average sale price of homes sold with agent assistance. i.e.: home sellers get far less money when they sell their home FSBO

So what is one pressing challenge facing FSBO home sellers who think they want to sell their home FSBO in the first place? A most vocal objection (at first anyway) for a FSBO home seller is "paying commission." And their (perceived) lack of interest in doing so. Right? That is why the home is being sold by the home seller, FSBO...

So let's then revisit the benefits of virtual staging. 95% of homes sell in 11 days or less when they are properly staged. For FSBO home sellers, the largest barrier for this group is really preparing and fixing up their home, to get offers from buyers. i.e.: getting their home show-ready, for prospective home buyers. So, when the objective is getting the most money through the home sale for the FSBO home seller, it's not really about "paying commission" at all, is it?

If a home being marketed for sale is not truly appealing to prospective home buyers, then homes sellers are really wasting their time. And wasting buyers' time too. Not effective. Removing clutter. Painting. Decorating. Repairs. Professional cleaning - show-ready. Recommended steps to take, and arguably necessary steps to take, for the FSBO home seller.

Let's go further along in the home sale process....

How about handling buyer inquiries? How about following up with buyer inquiries? Returning buyers' emails, calls, and texts... Presenting the FSBO home to the right buyer prospects. Getting the FSBO home in front of a good pool of prospective home buyers, who are willing, and who are able, to pay the right price to the home seller for their home.

One approach we have at Team With Hearts is, our focus on New York buyers. According to a Reuters December 15, 2020 article, "About 3.57 million people left New York City this year between Jan. 1 and Dec. 7, according to Unacast." Our Real Estate Team is in Monmouth County, New Jersey. So, it's a smart approach for us to take - New York buyers.

Yet, that's just an approach, albeit a good one, yet not a "magic elixir." No market approach can replace clutter removal, home updates, professional cleaning, handling buyer inquiries, and getting a home truly show-ready for prospective home buyers. And the Realtor team that works this space very effectively is far more well-suited to handle this process than is the individual home seller who is trying to sell...just one home, by themselves, part-time.

Home inspections, appraisals, negotiating through the home inspection report. Keeping the buyer's lender tuned in and on top of the home buyer's pre-approval, the underwriting process, and the closing process too. Detail-laden, and complicated too. Several steps to take, to sell a home. Yes, a FSBO home may very well sell. For less money, and with more stress for the home seller. Who in turn, gets less money.

In the year 2021 - with nearly $19 trillion in homeowner equity - time-tested, vetted, and effective "tools'' - such as virtual reality tours, 3-D interactive tours, and virtual staging - coupled to the implementation of good marketing - i.e.: a Marketing Plan - by a real estate professional is very powerful. It works. It's working for us. And for FSBO home sellers, statistics do indicate that an overreliance placed upon the Internet - and selling their home FSBO - could be a misadventure, so-to-speak. As well as an unreliable foray into an outcome spelled out to be a lower sale price when they sell their home, FSBO.

For Realtors, wise integration and proper utilization of the Internet, and of video - i.e.: "tools" - would be a very good way to convey a good message to a FSBO home seller. The message being, getting the most money for their family when they sell their home.

Conversely, if a Realtor does not integrate tools effectively, then a causal overreliance by FSBO home sellers on the Internet - or on print media, or on yard signs, or on maybe knowing a home buyer themselves... - would likely continue to lead to lower sale prices for FSBO home sellers...the same home sellers would like to attain the highest price when they sell their home.

The onus is on the professional - i.e.: on the Realtor - to honestly and to effectively communicate reality to FSBO home sellers. Failing to do so, could likely lead to less real estate listings for the Realtor...and to lower sale prices for FSBO home sellers. Less equity realized, for home sellers, in the year 2021. Neither of these being an opportune outcome in real estate, in the year 2021.