Home sellers get a helping hand from Israeli start-up
Putting a house up for sale without a real estate agent is a challenge, but Fisbo seeks to make it easier
Among the biggest challenges of selling a house is contending with the many interested third parties who hope to make a few dollars off one of the biggest deals of in the life of a homeowner – among them the real estate agents who, at the end of the day, represent not buyers or sellers, but themselves. Although most do what they are supposed to do, there are enough unscrupulous agents that make the idea of selling a home without the assistance of one very palatable.
Home-sellers who prefer not to utilize the services of a real estate agent often go the FSBO – For Sale By Owner – route. A sign on the lawn was the traditional way to sell a FSBO home, but in the Internet age, there are a plethora of other methods, from community email lists to real estate sites like Zillow.
Unfortunately, said Rinat Sherzer, a founder of new start-up sales site Fisbo.co, existing sites aren’t really geared to the needs of FSBO sellers.
“One of the biggest problems in FSBO sales is a lack of information, with buyers unable to ascertain in advance information about the house, its condition, prices, etc. The agents have that information, which is the main reason why people go with agents, even though there are significant conflicts of interest in working with one – the agent, after all, is interested in getting a commission for himself, not necessarily in getting you the highest price,” said Sherzer.
“Fisbo.co has a database of verified FSBO homes, complete with details about its repair history, floor plan, neighborhood schools, transportation, and anything else a buyer would need to know. All that information is available up front to buyers on our site. Thus, we have removed the main obstacle for homeowners to be in charge of their own sales effort,” she added.
Currently operating in a pilot program in Israel – in just two months, said Sherzer, the site has garnered interest from thousands of sellers and buyers – the company opened an office this week in New York, in order to export its gospel of FSBO efficiency to the US.
FSBO sellers were always considered outliers in the real estate world; most industry professionals recommend against self-selling, mostly because of concerns that a FSBO seller will miss some important details in the contract, taxes, closing costs, or other issues that could end up costing them big money. But there are strong arguments for FSBO too, mostly surrounding the compromise on price sellers often have to make when dealing with agents, who usually get 6% of the sale as their commission – requiring the owner to either raise their price or take home less money.
Then there are the manipulations agents often use to sell the houses in their portfolio – not necessarily yours. “Often agents will use one house in a neighborhood as a comparison to another one where they stand to make a better commission, with your house positioned as the less-desirable one,” said Sherzer. “If you have a contract with an agent, it’s in their interest to sell your house – unless it’s in their interest to sell another one.”
Fisbo supplies tools to foster an unhindered connection between sellers and buyers without interference from agents. While anyone is free to browse the listings, phone numbers or specific addresses are supplied by the seller to buyers who contact them through Fisbo’s chat or messaging applications.
“We experimented with one house, listing the phone number with the other relevant information on the site,” said Sherzer. “The owner of that house got 40 phone calls in 24 hours – all from agents who were seeking to represent the house.”
As a further sign of the seriousness with which Fisbo takes the home selling and buying process, the site vets every single one of its listings, sending out a photographer before listing it. “With Fisbo, buyers are guaranteed that they are getting a bona fide FSBO listing without a surprise demand for commission later on in the process from an agent, and sellers know that they are reaching real bona fide buyers, not agents.”
Among Fisbo’s innovations, said Sherzer, is an algorithm that checks identification information, phone numbers, and other data in order to determine whether a site registrant is a home-seller or a real estate agent.
“Honestly, we have nothing against agents, but they just don’t belong in a site designed for FSBO sales,” Sherzer said. “Unlike with agents, we do not require that sellers use Fisbo exclusively, and they are free to sell their homes through any other channel they can, so if an agent brings them a buyer, they can feel free to sell it through that channel.”
In that case, the price of the home is likely to go up to cover the agent’s commission.
“There is no charge to use the site,” said Sherzer. “Our revenue will come from added services, such as the creation of a 3D map of a home for sellers, and advertising related to the real estate, home improvement, and associated industries. In real estate, there’s no end to the partnerships and advertising opportunities. The only thing we don’t want to make money from is fostering communication and sharing data between homeowners and homebuyers – to make the FSBO process easier for everyone.”
