For sale by owner, or FSBO, involves homeowners selling their properties without the help of real estate agents. This strategy has the potential to save home sellers money on real estate commissions, which can significantly reduce their final sale price.

But for those considering a FSBO, there is more to consider than just the cost savings. Selling a property yourself is a major undertaking that requires careful planning and execution. It is also fraught with potential pitfalls that can actually result in less profit at the end of the day.

For Sale by Owner: Pros and Cons of Selling Without an Agent

Traditionally, FSBO home sales involved a seller posting a sign on the lawn, advertising in local newspapers and real estate circulars, hosting an open house and relying on word of mouth to sell the property. And since the FSBO model did not include listing the property on the Multiple Listing Service (MLS), which allows real estate brokers to share listings with each other, the FSBO seller was at a significant marketing disadvantage.

There are now a number of websites that offer home sellers the opportunity to list their homes on the MLS for a fee. Some are full-service, offering both home listing and selling services, while others are flat fee, providing only the MLS listing.

Regardless of which website is used, home buyers should always use a licensed real estate agent to assist with the home buying process. Home buyers will need to work with title companies, appraisers and mortgage brokers to close the transaction, and a knowledgeable real estate professional can be invaluable throughout the process.