A 6% solution that realtors love to hate

But it grew on them. The cousins contacted for-sale-by-owner sellers in the local newspaper, about 25 of them, and offered a free listing on a Web site. Miller's husband paid $50 for a used power saw at a garage sale to make yard signs. They checked out library books on making a Web site. With eight listings, including Murphy's, FsboMadison went live Feb. 28, 1998.

A young couple found the site and bought Murphy's house. "We sat there and had a glass of wine," Murphy recalled. "And they said, 'Hey, there's that crack in the basement wall.' And we said, 'No problem. We'll take care of it.' " Dealing directly with each other seemed so civilized. "I keep coming back to that," she said.

With the yard signs, some newspaper advertising and people finding it on the Web, the site took off: 333 listings in 1998; 777 in 1999; about 2,000 each of the last three years.

Briefly stay-at-home moms after their daughters were born, the cousins became busy home-based entrepreneurs. Among the first words spoken by Miller's daughter, Tatum, "was fsbo, and we were so proud of her," Miller said.

To real estate agents, for-sale-by-owner conjures up some cranky tightwad trying to sell an overpriced, ramshackle house. Agents utter fsbo as if there was something foul stuck to the bottom of their shoe. "It's a commission-avoidance scheme," said Sheridan Glen, manager of the downtown Madison office for Wisconsin's biggest real estate broker, the First Weber Group.

Glen ticks off the many tasks that real estate agents handle: using market savvy to help price a house; advertising and showing it; negotiating an offer; organizing the paperwork for closing. "We do a good job," he said. "We deserve 6 or 7 percent."

Agents take comfort by reminding themselves that for-sale-by-owner and other alternative sales methods blossom in an up market and tend to wither in market downturns. The market is slowing now. And they note that for-sale-by-owner, which has been around as long as property rights, has always accounted for something less than 20 percent of home sales.

Kevin King, executive vice president of the local Realtors association, runs the multiple listing service but says he pays no attention to FsboMadison. "It's not important; I don't follow it," he said. "I don't even know the people."

But times have changed. Most consumers are now accustomed to executing large transactions, including airline tickets and investments, over the Internet with little or no assistance. Buyers and sellers are far more comfortable dealing with each other through Web sites like eBay. And it is far easier to find the for-sale-by-owner crowd, which makes up some 20 percent of all sellers, on a single Web site with photographs and property descriptions, not unlike the official multiple listing service. Do-it-yourselfers were hard to find among the classified ads and makeshift yard signs.

The presence of a robust for-sale-by-owner operation has also helped open up the Madison market for other alternatives to real estate agents. Jason A. Greller, a lawyer, charges a flat fee of $600 to help a buyer or seller on a house transaction and handles about 200 a year. Many of his clients find a house on FsboMadison and also see his advertisement on the site.

"Isn't 6 percent just a little too much?" Greller said. "Fifteen, 30 grand!" Even a lawyer charging $400 an hour is cheaper than a real estate agent, he said. "I do more than fill in forms for people. I teach them how to sell their house."