If over 30% of all homes sold are by owner, then why is it your “friendly real estate agent” says he is the only way to get the job done? I really don’t believe real estate agents anyways as I have witnessed many retired brokers with for sale by owner signs on their lawns. The main thing a FSBO needs is time on their side. If you do NOT need to sell your home in a month and can afford a 4-6 month time frame, this would be an ideal situation. Here are the other factors you will need to consider if you are going to sell your own home.
Price is king. Don’t shoot yourself in the foot, make sure you price your home realistically. Nobody really cares if you have a new fence and it cost you $10,000. What matters most is what your home is worth in today’s market based on comparable sales. As a for sale by owner you want to price your home slightly less than what a comparable home is listed for with XYZ realty. It is a mistake to try and earn the commission rather than save it. The best way to set the price is to get an independent
appraisal. An appraisal is based on comparable sales and is usually a more reliable source without all the fanfare of a real estate firm. You can show this to buyers and deal from a strong position.
Get a home inspection done by a licensed independent professional. Not from your brother in law who has a pickup truck and a hammer. Take care of any repairs that turn up from the inspection. This way a buyer can’t nickel and dime you from your asking price. Same goes for a survey. If you can get your hands on one this will take away any of the guess work as to your properties dimensions.
You would be shocked at how people present their homes when selling privately. Take care of the obvious things like, cut the grass, new coat of paint, clean the carpets, wash the stinky dog and remove all clutter from your closets and the garage. People like bright and open living areas. So if you need to move out some of your extra furniture to storage or a friends house this will pay dividends. Also open all the drapes and window coverings.
If your home is priced right then a moderate marketing campaign is all you need, your buyers will find you, especially if a real estate agent has a comparable home listed in your neighborhood. An ad in the newspaper, some brochures, a for sale by owner sign are the basics. If you have the ability you could make a small web site about your home. Also, each city has a FSBO related company which will give you a paper listing, web site exposure and some of the forms. Of course you can hold open houses but be a little careful. Always have at least 2 adults available, do not let too many people in at once and hide your valuables.
Real estate agents will argue that private home sellers are at a disadvantage because of the complex nature of real estate transactions. They are right! Easiest way to solve this is when a buyer wants to make you an offer have a lawyer or notary look at it beforehand, to make sure you are on the right track. A LOT cheaper than a real estate broker! Agents will say you need to strike when the iron is hot but I think it’s not out of the question for a buyer to wait 24 hours so your lawyer can look at the deal.
Don’t take 72 hours clauses. This simply means that a buyer wants your house but must sell their home first. It is a waste of time, money and energy. Buyers will want to tie up your home and a 72 hour clause gives them the first right of refusal. I always say come to me when you have your money unemcumbered and lets make a deal at that time.
Qualify your buyers. This is not an easy task but many people are professional time wasters. If you get calls on your advertisement or at your open house, you need to ask questions like: Do you currently own or rent? Have you looked at many homes? What kind of work do you do? Do you need to sell a home before you can purchase? You can ask these tactfully and judge the responses. Really, if they do not want to answer them likely they were just out to waste your time.
These are the most important things you can do when selling your own home. Everything listed above is geared to give you an advantage and deal with your buyers from a position of strength, hopefully you can save a few dollars. After all you own the home, you pay the taxes, you pay the mortgage, why should you not get the highest net dollars in your pocket!