Property Rounds: ‘FSBO’ troughs in Connecticut and beyond
Situated on opposite sides of Fairfield County, the Ridgefield and Stratford homes represent extremes on another element of the residential real estate market, with a $6.9 million gap between their listing prices.
One thing in common besides the pretty vistas from their respective hillside locales? Neither owner retained a real estate agent to assist in the sale process — a scenario that hit an all-time low nationally this year, according to the industry’s major trade group.
As 2018 came to a close, just over 100 Fairfield County homes were listed for sale on Zillow by their owners without the assistance of a real estate agent, of nearly 5,500 properties currently on the market.
For-sale-by-owner listings range from a 730-square-foot Stratford ranch built in 1940 — offered “as-is” at $80,000 as an accompanying blurb takes pains to explain — to a Country Club Road mansion in Ridgefield with 10 bedrooms and bathrooms and 22,000 square feet of space, priced at $6.9 million.
According to a National Association of Realtors survey this year, for-sale-by-owner listings fell this year to their lowest level on record, with NAR attributing the decline to the results it says its members deliver to home sellers.
For-sale-by-owner transactions accounted for 7 percent of total U.S. sales this year, down from a peak of 15 percent in 1981.
Visitors, expected and not
Of those transactions, nearly half involved sales where a buyer materialized with no marketing effort — whether sales between neighbors or those in which a buyer made a spur-of-the-moment offer (Zillow offers property owners a “Make Me Move” widget that allows them to post the price at which they would take an offer, without actually listing the property formally for sale).
In 36 percent of cases, however, sellers did not want to pay sales commissions to brokers, who typically charge 5 or 6 percent of the purchase price, while picking up many of the costs of marketing a property. Many of the remaining transactions involved newly constructed houses sold directly by their developer with no intervention by a listing agent.
With no agent in the mix and little experience in today’s real estate markets, homeowners struggle the most with fixing the right price and by extension adding time to the sale process, according to NAR. It is an art that many agency-represented properties have been known to flunk, as testified by any number of homes languishing on the market a year or more in southwestern Connecticut.
High up on the list as well is understanding the intricacies of legal paperwork required to sell a home. And NAR peppers its website frequently with articles on other tasks and headaches that await those looking to sell their own properties, to include being on hand when curb shoppers show up at the front door; and getting swamped with low-ball offers from real estate investors looking to flip houses.
It is not unusual for homeowners going it alone to eventually hire an agent after failing to find a buyer at the terms they want. But the reverse can happen as well, in cases when property owners get fed up with an agent being unable to effect a sale.
And in rarer cases both scenarios can occur. That was the case this month for a Redding home on Cross Highway that was listed last spring by William Pitt Sotheby’s International Realty; switched to homeowner representation for the summer and fall months; with the Ridgefield office of Keller Williams Realty then getting the listing with weeks to go in the calendar year.
Alex.Soule@scni.com; 203-842-2545; @casoulman