The National Association of Realtors claims that over 6 million newly constructed and existing homes were sold in the year 2017. 7% of these were for sale by owner, abbreviated as FSBO. Sellers who worked without an agent only put their homes for two weeks on the market and found a buyer. For agent-assisted sales, the time on the market was three weeks. However, the median selling price for an FSBO home was around $190,000. For homes that were sold through a realtor, the median selling price was $250,000.
What insights do the stats provide? If you want to sell your home fast, FSBO is the way forward. Yes, there are certain challenges involved such as pricing your home correctly and dealing with the paperwork. But don’t worry, we’ll guide you through the entire process. Follow our for sale by owner checklist and tips, and you’ll be able to sell your home at an amazing price real soon!
FSBO Has Its Pros!
- Because it’s the fastest way to sell your home!
- Agent’s commission is usually around 6% of the selling price; when you opt for FSBO, you enjoy additional savings!
- Marketing your own home can be quite fun, especially if you have a creative spark! And even if you don’t want to spend too much time on brochures, flyers and social media promotions, you can use online tools that help you find potential buyers… some of whom even give all-cash offers!
How to Sell Your Home Without an Agent
Make It Sellable
How sellable is your house? The first step of selling your home is to turn it into a house that buyers would want to buy. Remove clutter from every single room. Thinking of remodeling the kitchen? Yes, it does improve value. But if your house isn’t too old, a thorough cleaning session should do the trick. Fix any pending repairs, though. And the same applies to your bathroom as well.
What about paint? Does every wall need a coat? Maybe you can skip the attic and basement. Choose any colors that you want, but make sure they are trendy. Deep clean the house, shampoo the carpets, polish the floors, remove all valuables and items of personal use until your house appears fresh and crisp.
And lastly – do stage your home. It can make all the difference!
Set a Price
This is the most challenging part, which will discuss later on in the article. But for right now, compare your house with similar homes, conduct an appraisal and then set a suitable price.
Find an Online, Flat Fee MLS
Multiple Listings for Sale (MLS) is the most comprehensive record of houses on sale in the United States. Find a flat fee MLS in your area and put your house up on sale. Provide as many details as you can, and always fill in the description field, mentioning the most attractive features of your house. Highlight all the pros and write in a way that entices buyers to come and check out your house.
Take High Quality Photos!
Photos are the most influential factor when prospective buyers decide houses which they must tour. Needless to say, the photos must be of superior quality. Take them after you’ve staged your house and take them in the best possible light with the most advanced equipment that you can get.
Take photos of the inside as well as the outside and of each room, highlighting fixtures and fittings.
Market Your Home
As comprehensive as an MLS may be, it shouldn’t be the only tool you use for selling your house. Spread the word through other means as well. Put ads on Facebook, Craigslist and other similar platforms. Prepare flyers, brochures and promotional material. This definitely incurs some costs, but hey, you aren’t paying the agent’s commission, remember?
And of course, you should even put up an FSBO sign out in the yard.
Organize an Open House
An open house is one of the most effective ways to advertise sales. Put up flyers and signs in the neighborhood and announce the scheduled date on Twitter.
On the day of the open house, maintain a warm and friendly environment inside. Also, arrange some light snacks for prospective buyers.
Understand the Selling Points
What are the main features of your house? Do include them in the brochures and listings along with key information such as location, lot size, asking price and numbers of bathrooms and bedrooms. Also, mention specific details like stainless steel appliances, granite countertops, oversized windows and hardwood floors.
Read other listings, and that should give you a fairly good idea.
Did some of the buyers show interest? Let’s negotiate a deal! Generally, prospective buyers submit an offer, which you can either accept or revise and send back to the buyer. The process continues until both parties reach a consensus and sign the final contract.
Generally, contracts are standardized. If you aren’t familiar with the law, it’s best to take legal help at this stage. Also, please note that if you don’t cancel or amend an offer from the buyer, it may turn into a contract when the attorney review period ends. Contracts are legally binding.
During negotiations, remember that price isn’t everything. Consider other terms as well. If there are too many contingencies, it can leave loopholes, causing the deal to fail. So avoid these wherever you can. Should the buyer insist on them, get a kick-out clause added, which would allow you to consider offers if you don’t get payment within a certain period. Also, evaluate the financial qualification of your buyer. Make sure they already have mortgage pre-approval.
While you can counter offer, do so for only a single offer! Should two buyers accept the counter offer, you’d be in major legal trouble.
Get the Home Inspected
Real estate contracts allow buyers to conduct a home inspection under which you are obliged to make repairs and fix faults if any are identified. If you don’t do this, the buyer has the right to cancel the offer.
Comply with Real Estate Laws
Comply with local and universal real estate laws. For instance, the Fair Housing Act states that sellers cannot discriminate buyers on the basis or religion, race or sex.
Close the Deal
The day is here! Buyers will conduct a walkthrough of your home to ensure that everything is in order and the house is in topnotch condition. If any problems are identified, you can still proceed ahead with the closing, but funds will be withheld in escrow. Generally, the process takes a month or so after the contract has been signed. During this stage, existing loans are paid off, deeds are transferred, and a new insurance is issued. When the legalities have been taken care of, you receive the proceeds.
Price Your Home Appropriately
Pricing your home can be daunting, but we’ll try to simplify it as much as we can. Remember that your first price should be the best price that you come up with because it’s only in the first 30 days that listings are reviewed the most.
Perform a comparative market analysis, considering at least 15 similar homes in your area. Get your home professionally appraised. Deduct around 5% to 10% of this figure for negative, unchangeable aspects like a small yard or busy street. Factor in the total home selling costs, and there, you should arrive at an appropriate price now.
The For Sale by Owner Checklist
Our For Sale By Owner checklist contains only the most essential steps and can come in quite handy.
Being armed with information helps you address challenges and potential issues that may arise.
- Find out as much information as you can on how to sell your home without a realtor.
Setting the right price is probably the trickiest part. Set it high, and you won’t find any buyers, and if you set it too low, you won’t make enough money.
- Evaluate comparable homes in your neighborhood.
- Visit open houses so that you know how to stage your home.
- Determine the total costs of selling your home.
- Set a price such that you earn your required returns. But of course, the price must not be too high compared to similar houses or you’d ward off potential buyers.
Simple Home Improvements
Even the simplest home improvements can improve value and attract buyers.
- Mow the low.
- Tidy the yard and remove the weeds.
- Decorate the exterior with colorful plants – don’t worry, these are inexpensive!
- Replace or remove worn-out furniture on the deck and patio.
- Wash the windows and paint the walls.
- De-clutter! This is the single, most effective way to attract buyers.
- Clean closets, cabinets and appliances.
- If you have carpeted floors, get them dry-cleaned! And if it’s too shaggy, you should completely remove the carpet.
- Mop the floors, and if you have wooden floors, you may want to polish as well!
- Clean the bathrooms.
- Fix all repairs – all means ALL. Leaving even one of these would drop the price.
- Paint on the inside as well. Choose bright, warm and friendly hues to make an impression.
- Toss some cushions here and there. Dim down the lights. Spray fragrance into the air – cozy and comfortable homes are always desirable.
Conduct an advertising campaign so that buyers know your house is on sale. Luckily, the internet has made this quite simple!
- Put your home up on the local MLS.
- Design flyers, emphasizing unique features of your property.
- Take photos, and they should be of ah-mazing quality – no compromise here!
- Develop a story that beautifies your home; homes associated with tales sell faster.
- Plan and conduct an open house.
- Set up an FSBO sign.
Open House and Home Tours
Yay! Buyers are here now; time to spark it up!
- Clean – yes, again!
- Bake cookies.
- Play some soothing music.
- Ask buyers to fill up a sign-in sheet containing various fields like names, addresses, and contact numbers.
- Prepare an offer form.
- Don’t follow buyers around the house. Let them tour alone, but do ask questions and make them feel comfortable.
- Find out if buyers are pre-qualified.
- Smile and de-stress!
Your efforts have paid off, and you finally have an offer!
- Assess the buyer’s qualification and contingency; they must have some financial means to buy your house.
- You can always counter offer, and yes, it doesn’t always have to be on price.
- Schedule inspections and decide settlement dates.
- Order contract forms and begin the paperwork.
Protecting yourself is mandatory. Seek legal assistance if required.
- Resolve issues that were found out during the home inspection.
- Choose a title company which will administer the closing process.
- Complete negotiated repairs if there are any.
- Pay all bills.
- Appoint movers so that they pack and move your belongings to your new home.
- Get your address changed at the post office, banks and mailed subscriptions.
- Bring identification on the closing date.
- Hand over the keys, and you’re done!
Whew! You’ve successfully sold your home without a real estate agent.
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