The definition of a For Sale by Owner (FBSO) has dramatically changed over time. The simple and predominately accepted definition of a FSBO is a home owner selling his or her own house without using the services of a real estate brokerage. This definition of a FSBO has become somewhat blurred as it is now possible to hire a real estate brokerage to “post” your listing on the MLS^® System while still technically selling your house by yourself.

Before the Internet

The internet became well known with the launch of Windows 95 in 1995, but most people didn't get it in their homes until 1997 and 1998. In fact, the percent of households with internet access only reached 50 percent in 2000! 

Prior to the internet, FSBO’s were extremely limited in finding any useful and cost effective ways in which to advertise their property. It really just boiled down to a sign on the front lawn, word of mouth among friends and relatives or perhaps an ad in the local newspaper, although such ads were quite expensive at the time. Even REALTORS^® had much more difficulty getting exposure for the properties they had listed. However, REALTORS^® did have their own MLS^® System, which at the time was a weekly “phone book style” catalog stocked full of houses for sale that each REALTOR^® faithfully lugged around. So, home sellers that choose to use a REALTOR^® benefited largely over a FSBO as their property was being seen by all the local REALTORS^® who would show their home to prospective buyers.

The other problem FSBO’s had during this time was getting their hands on information that would enable them to price their homes accurately. As a consequence, many were over-priced and stood little chance of selling even if they did manage to attract a buyer. Or, they would under-price their property thereby negating the benefit of selling privately. Needless to say, being a FSBO prior to the internet was an uphill battle, one of which rarely resulted in success.

After the Internet

In the early 2000’s, the popularity of home computers and the internet exploded, and as a result, FSBO’s gained a valuable tool in their marketing efforts, the “FSBO Website”. At this time, many enterprising entrepreneurs recognized the opportunity to develop websites that, for a small fee, would allow private sellers to advertise their homes for sale. Some of these businesses would even send out professional looking sign packages to help the sellers in their efforts to sell privately. Many of these sites became quite popular and therefore provided a decent amount of exposure to the home sellers that advertised their properties on the site. Without question, the success ratio for FSBO’s was on the rise!

That said, even with the increased exposure that the FSBO Websites brought to private sellers, there remained one major hurdle that FSBO’s could not overcome. They could not get their homes onto the MLS^® System and, as importantly, it’s very popular public website MLS.ca (now REALTOR.ca). So why is it so important to get onto the MLS^® System and REALTOR.ca? In a word, buyers. You see REALTORS^® control the vast majority of home buyers, and generally speaking, REALTORS^® ignored FBSO Websites and the homes “listed” on them. So the problem of exposure was somewhat improved, but you were only appealing to a small group of unrepresented buyers.

Nevertheless, the internet and FSBO Websites were an important step in the evolution of a FSBO and certainly helped many private sellers avoid paying high real estate commissions. However, your chances of selling were still considerably less than a home listed on the MLS^® System as that was where all the REALTORS^®, and hence buyers, were operating.

Mere Postings

Without question, the single most important thing that has ever helped FSBO’s is the allowance of “mere posting” listings onto the MLS^® System. This was not a change that the real estate industry welcomed with open arms. In 2010, the Canadian Competition Bureau was successful in forcing the Canadian Real Estate Association (CREA) to change its rules that govern the MLS^® System and REALTORS^® across Canada. The result of these rule changes was that real estate boards across Canada now had to allow mere postings onto the MLS^® System.

A mere posting is a listing on the MLS^® System in which a private seller hires a real estate brokerage to “post” his or her home onto the MLS^® System (and REALTOR.ca), usually for a small flat fee, and then controls the sale without the listing brokerage being involved. Mere postings allow REALTORS^® to limit their involvement on a listing to a relatively short and definable time frame. A mere posting is essentially a FSBO that appears in the MLS^® System. Any cooperating buyer's agents would call the home owner directly, rather than the listing agent, if they wanted to show the property. Additionally, if a buyer's REALTOR^® wanted to submit an offer on behalf of his client, the offer is given directly to the seller, not the listing agent.

Mere postings served to get FSBO’s over that last hurdle needed, access to the large pool of qualified buyers. FSBO’s rejoiced and success ratios went through the roof. Mostly true, but a few things still needed to be addressed. What many FSBO’s found out is that they didn’t really have the time, and in many cases the expertise, necessary to sell on their own. They needed additional services, but not full service, from the REALTOR^® that provided the mere posting.

Adding Services

The other important outcome that resulted from the rule changes CREA was forced to enact in 2010, aside from the allowance of mere postings onto the MLS^® System, is that REALTORS^® are now allowed to sell individual services. Prior to the changes, all REALTORS^®, by virtue of their own rules, essentially had to offer "full service" when listing a property. Now, a REALTOR^® can sell you a mere posting and then also sell you additional individual services that you may require. For example, here at rhinorealty, a REALTOR^® Key Lockbox to help with showings and receive REALTOR^® feedback on your property. It really is the perfect scenario for a home owner that does not want to hire a REALTOR^® for full service, but would rather participate in the sale by doing the things they feel comfortable doing.

So as you can see, both technology and important rule changes to the MLS^® System have indeed blurred the line as to what constitutes a private sale, or a FSBO. While it’s still possible to sell your home as a true FSBO, without any involvement by a real estate brokerage, it’s not advisable in this day and age.

Our For Sale By Owner (FSBO) Package allows you to choose what level of service you require from a REALTOR^® and whether or not you want to add additional items and/or services to your package. You will save a significant amount of money as compared to paying traditional real estate commissions, as you should, by participating in your sale. Do the things you feel comfortable doing and hire us for the things we do best.