iBuyer Versus Realtor Versus For Sale By Owner (FSBO): Which Of The Three Comes Out On Top?
October 26, 2019
iBuyer Versus Realtor Versus For Sale By Owner (FSBO): Which Of The Three Comes Out On Top?

iBuyer Versus Realtor Versus For Sale By Owner (FSBO): Which Of The Three Comes Out On Top?

Homeowners entering the real estate market as sellers are generally unprepared. They have pre-conceptions that quickly dissolve when confronted by the flurry of moving parts that create new stresses unimagined.

The first big decision is, “Who’s going to sell my biggest asset for me?” This exposure article is designed to give you a succinct overview of the best solutions to this pivotal question.

When selling a home today, there are multiple choices:

  1. You can go the traditional or realtor route (the most prolifically used in the residential markets today.)
  2. Or you can contact an iBuyer for a fast cash deal.
  3. You can elect to continue as “For Sale By Owner (FSBO)” – essentially becoming your own realtor.

The expansion of choices is in one part due to digital technologies that help us to communicate faster, with more accuracy, and traverse vast distances almost instantaneously.

Virtual messaging systems and social media, in combination, have connected the home seller to new possibilities and marketing models unthinkable as being practical a few years back.

In another part, selling a home has transcended to more sophisticated levels. The real estate environment can provide innovative options that are verifiable and shown to work well for targeted needs.

In some cases, negative connotations weighed heavily on home seller decisions. Still, access to reliable data has dispelled them to a great extent. For example, people perceive iBuyers as entities set on low-balling every offer to “steal” your home away. How that has changed:

  • Many sellers lock onto the iBuyer option expecting to receive offers close to fair value.
  • Yes, there are still iBuyer operators trolling the desperate-buyer ranks, hoping for ignorance to rule the day. However, there are more and more sincere entrepreneurs entering the arena to close in on deals that make all parties happy.

Here’s a summary table to start that ranks the three models on pivotal features. We derived it from a variety of reliable real estate information sources on the Internet. After that, let’s look at each one specifically to expand on details.

Traditional Marketing

  • You are selling your home through a realtor, requiring you to pay both the buyer’s and seller’s commission (around 6% of closing value). It’s negotiable and differs state from state.
  • There’s a lengthy process (maybe up to four weeks) when it comes to selecting the right realtor for your needs. There are hundreds, perhaps thousands in a confined urban region.
  • Once that’s done, the home should be professionally photographed by and possibly videoed for virtual 3D viewing. Promotion through the MLS calls for cutting edge digital exposure to make a market impression. Some realtors offer this free of charge, others charge it out as an extra.
  • Sellers are generally encouraged to improve curb appeal, declutter, and implement at least minor repairs.
  • Often they/re pushed to renovate what realtors consider to be negative features (like, for example, outdated kitchens in a neighborhood where a lot of upgraded homes are for sale).
  • Staging of the home is often recommended to put one’s best foot forward. It means your old furniture goes out to make place for decorator-grade rentals – on your dime.
  • Presale expenses like storage, renovation, kenneling of animals to keep walkthroughs pet-free invariably enter the equation.
  • You should expect a long selling process of average sixty-five days, but in reality, it’s frequently a lot longer. So many homes fall out of the selling process and are not counted in. If they were, the overview would look a lot bleaker.
  • The seller must accommodate multiple walkthroughs and possibly show days. In other words, accept considerable inconvenience that disrupts one’s regular schedules.
  • Once the offer closes, there are disruptive contingencies to address.
  • Most buyers insist on a home inspection to possibly discover defects of a more severe nature. It can range from mold detection to uncovering foundation and HVAC issues.
  • Home assessment where buyer mortgage applications are in the mix. If the home fails to assess at the offer price, and the buyer cannot or is unwilling to fill in the difference, the deal can implode.
  • Buyers frequently throw Mortgage contingency into an offer. It means that if the buyer doesn’t get the required mortgage on a valid application for any reason, it creates an exit opportunity. 
  • Here’s one that no realtor worth his or her salt will allow: the offer only goes through if the offerees can sell their home. It’s a condition that can hold things up indefinitely and is all in the buyer’s favor.
  • Be ready to deal with the stress of renegotiating the offer as contingency factors surface – that’s if indeed you are truly interested in closing.
  • Finally, when you intend to close, it can lead to more disagreement when seller and buyer are not on the same page. Some buyers are inflexible.
  • It’s not the end of the cost-buildup. Be prepared for moving costs, closing costs dictated by state taxes, title requirements, and lawyers.
  • Total expenses related to traditional marketing can end up around 10% or even 12% of the original offer price.

Quite a list. The bottom line is that traditional realtor-selling is a complex process, with an avalanche of variables that require your urgent attention. If you need cash fast, this isn’t an optimal route.

For Sale By Owner

  • Everything you see above, except paying for your a buyer’s realtor.
  • 88% of the buyers are realtor represented. It means you’re unlikely to dodge the 3% commission due to them.
  • A question: is bypassing 3% inside a total of 10% – 12% of offer cost worth it? Here are the disadvantages:
  • No professional realtor advice through the process.
  • No guidance on misrepresenting your home that may lead to later liability. You may need a lawyer to help you – with a fee of course.
  • No subsidy from willing realtors on photography & videos. No MLS advertising without a fee paid to a realtor (which somehow defeats the purpose).
  • An amateurish promotional effort, with yard signs and word-of-mouth as your best bet (i.e., antiquated by modern standards).
  • There’s no escaping all the realtor-related issues, except that there’s nobody to guide you in dealing with contingencies, perusing the offer, and the myriad considerations that impact a successful closing.

It’s no wonder that FSBO succeeds in around only 6% of all closings and generally at an average of 31% lower than the typical closing price compared to employing the services of a realtor. Also, it takes much more time.


 iBuyers are active in states like Florida, California, and New York – they’re everywhere in the USA actually. To make sense of the comparison, we focused on a reputable iBuyer (i.e., DealHouse) in Long Island that has a good customer reputation for consistently meeting performance expectations.

In other words, an alternative model that’s working well in comparison to traditional selling methods. They share the following general characteristics:

  • There are no realtors involved. Therefore the 6% commission disappears.
  • No decluttering, curb appeal improvement, or cosmetic renovations required. DealHouse does not penalize the absence of these items in the submitted offer. They believe buyers alter things to suit their taste, thus wasting any expenses involved in these items.
  • The two-month plus realtor time cycle cuts down to days. You get an offer within 24 hours of contact most of the time.
  • The offer relates to comparisons in the neighborhood with similar locations. DealHouse goes the extra mile to be competitive.
  • Contingencies like mortgage applications and home assessments don’t enter the picture because the offer is a cash-only contract.
  • Even the home inspection can’t upset it, because this event initiates before NOTE: The home inspection (HI) looks like the only thing in common with the other two models. They all do it the same, more or less. The standout differential is that with FSBO and realtors, it impacts after the offer is in. In contrast, here it’s in the offering statement, before you are induced to set your expectations on an unrealistic number.
  • DealHouse reviews are excellent. On speaking to some clients, they confirmed that working backward from the DealHouse bottom line, adding back all traditional expenses, the offer made ultimate sense to them. The avoidance of aggravation, getting cash quickly, and moving smoothly through the process was impressive. 

Alternative Real Estate Marketing has some compelling benefits.

The analysis above indicates that sellers, especially those looking for fast cash without compromising value, have an excellent resource with iBuyers. The negatives, if you can call them that, is that they are regional in nature.

DealHouse, for example, operates only in Long Island in Suffolk and Nassau counties. Their big focus is on cities like Bellmore, Medford, Holbrook, East Islip, Levittown, and anyone on the list below:

There isn’t the same state or federally regulated rules that governs traditional real estate representation. You have to rely much more on your self-directed due diligence. If you can get past this, the DealHouse option makes ultimate sense. 

Still not convinced that iBuyers are a mainstream alternative? Take a look at the Google searches coming through over the last month.

  •   sell houses as is      
  •   sell house as is  
  •   buy my house as is  
  •   sell your house fast for the right price  
  •   selling house fast in  
  •   cash buyer for houses    
  •   selling my home fast  
  •   sell a house for cash  
  •   we buy junk houses  
  •   selling my house as is  
  •   selling house quick  
  •   house buying company  
  •   we buy home  
  •   we buy house cash    
  •   home buying companies  
  •   selling property online  
  •   want to sell my house quickly  
  •   the best way to sell your house quickly   

The DealHouse benefits are creating a stir that’s undeniable. Our transparency is clear to all relevant parties, and every frequently asked question is addressed with the highest regard. Again, go no further than our client reviews for ultimate peace of mind. 

Contact us, and we’ll be there within hours to make an onsite inspection. You’ll be impressed with a fair and transparent market valuation that’s in line with comps in your neighborhood. 

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