From the get-go, understand that For Sale By Owner transactions are complicated, involved, and sometimes tedious work. Such transactions are possible, but most people aren’t up for the challenge. In fact, FSBO transactions only account for 9% of the housing market.
Yes, it will save you money. Commissions can run as high as 6% of the sales price. To put this in context, selling by owner could save you $12,000 on the sale of a $200,000 home. However, many people don’t want that responsibility and consider the fee worth hiring a professional to handle the transaction.
If you’re determined to go the FSBO route, take a deep breath and get organized. The preparations are on you, and there will be some upfront costs. Be prepared for such sales to take considerable time and work. Brush up on your negotiating skills.
Real estate agents typically handle a property’s paperwork, communication, and showings. You’ll need to do your research, keep detailed records, be prompt to follow up, and keep your schedule open so you don’t miss a potential buyer.
Also, you’ll need to keep the house clean and yard maintained. You might consider hiring a cleaning service and landscaper to help you with these tasks. It’s also typical to elicit the help of other professionals such as lawyers, title companies, appraisers, and home inspectors.
Steps to For Sale By Owner Success
Check public records to ensure there aren’t any outstanding liens on the home. You might consider hiring a title company or attorney to do some research and provide an abstract of title and title commitment.
Get a professional home inspection. Even if you don’t make the repairs, you’re still required by law to disclose them to the buyer.
Hire a professional appraiser for an accurate, up-to-date property analysis and estimated value.
Make repairs or update light fixtures and hardware. Repaint the walls in pleasant neutrals.
Do your research! Read newspapers and real estate blogs to understand the local market and recent sales activity. Check local real estate groups on Facebook. Visit homes in your area to get an idea of the features or improvements common to your neighborhood.
Price Your Home
It’s important to get this part right, and it requires several steps. Strive for the Goldilocks principle when pricing your home – not too high and not too low. Most sellers make the mistake of listing their property price too high.
Use online calculators to help find a ballpark price range. Check your neighborhood’s comps, and track local listings and their sales prices. Make a note of the features of houses in your neighborhood. For your home to sell successfully, you’ll need to match the improvements in your area.
Consider reaching out to a real estate agent for a Comparable Market Analysis, or going straight for a professional appraiser. The more data you can collect, the more accurately you’ll be able to price your home.
Clean the Home & Landscape the Property
Deep clean the house from top to bottom. Don’t forget the small things, like cleaning blinds, baseboards, vents and light fixtures. Hire a professional carpet cleaner and keep the kitchen, bathrooms, and bedrooms spotless. When selling your home, it has to remain photo perfect at all times.
You want buyers to imagine your home as their own. This means you’ll need to remove items that personalize the space. Pack up personal effects like knick-knacks, photographs, family memorabilia, and toys.
Don’t dismiss curb appeal! The exterior of your home can have significant impact on a buyer’s decision to walk through or not. Water the lawn, keep the grass cut and edged, trim trees or hedges, and plant flowers.
Create a Marketing Plan
Once you’ve picked your price and have the house in top-notch shape, it’s time to plan your marketing strategy!
Evaluate local demographics.
First, determine who your buyers are. Examine the composition of your neighborhood. Is it made up of families? Older couples? Younger people focused on their careers? What are their hobbies? What kind of vehicles do they drive? Visit the Census Bureau website and click on “State and Quick County Facts” to view local demographic information. Understanding your buyers will allow you to custom tailor your marketing efforts.
Invest in professional photos.
Homes listed with high-quality images double your chances of exposure!
Create a website for your home!
WordPress and Wix.com both offer free website builders that make getting your home online a snap.
List your home online.
Read through comparable listings to get an idea of what features to highlight and how to write compelling descriptions. There are reputable websites where you can list your home on the MLS for a flat fee. Several also sell marketing tools like flyers, brochures, and yard signs to compliment your listing.
Get the word out!
Advertise on social media and in print publications. Facebook, Instagram, Twitter, and Snapchat are free options to get the word out to people you know. Craigslist is another great place to list your for sale by owner home. Newspaper ads aren’t very costly, and many offer online advertisements in tandem with the printed version.
Also include traditional methods like flyers, yard signs, and brochures. These types of advertising endure because they’re effective. Hosting open houses can also be a useful way to get traffic through your home. Remember to set out light refreshments and sales brochures by the door.
Be Available and Follow Up
When you use a real estate agent, you’re purchasing the flexibility in their schedule to show your home whenever potential buyers are available. If you go the for sale by owner route, you’ll need to do everything in your power to be there for every showing.
When showing your home, always use the buddy system for safety. Set up a lock box for buyers agents to show your property when you’re away and always follow up with the buyer or buyer’s agent promptly.
Hire The Right People
Even if you go FSBO, you’ll still need to enlist certain professionals to help your transaction run smoothly.
Attorneys are indispensable, and some states require them in real estate transactions. A lawyer will prepare documents, execute contracts, arrange closings, and help you vet potential buyers.
Appraisers and home inspectors will help you determine market value and find any problems with your home that could reduce the selling price. If the inspection reveals any faults, hiring a contractor will ensure the issue is corrected professionally and promptly.
Title companies serve as a disinterested third party to assist with your transaction, hold documents and earnest money, and offer a location to conduct the closing.
Negotiate Offers (or Lower the Price)
Request proof of a mortgage pre-approval before starting negotiations. Pre-approved buyers are more likely to carry through on a sale because they’ve already got a lender lined up to provide the money.
Be aware you might end up working with a buyer’s agent. It’s customary to offer the agent the typical commission – around 3 percent of the selling price. Don’t skimp on this one.
Leave your emotions at the door. Taking criticism of your home at face value can be difficult. When you invest time and memories into a living space, you become attached and protective of it.
Once you’ve assembled all the necessary paperwork, be sure you’ve got everything in writing, dated and signed. Find the documents you’ll need on the Texas Real Estate Commission website. Have your lawyer looks everything over to ensure you’re in compliance with state and local laws.
If it’s been sixty days and you’re still having trouble selling, consider reevaluating your marketing strategies and lowering your asking price.
If you’re ready to sell but don’t want to spend the money on a real estate agent, we have a solution!
Whitestone Acquisitions buys houses as-is, for cash! We can usually complete your sale in as little as ten business days, depending on the title search.
If you want to sell to experienced buyers AND pay no commissions, please call us before you put in too much work!
This is a great option for sellers who don’t want to spend money on expensive repairs or keep their home picture perfect at all times.
Click here to learn more about our process!