When it comes to how to sell your house, there are two options. You can either ask a real estate agent to sell on your behalf or learn how to sell your home on your own. When a home is put up for sale without involving a real estate agent, it is referred to as ‘For Sale By Owner’ (FSBO).
3 Benefits of FSBO
Selling your own house offers several benefits:
- Higher earnings – Real estate agents usually charge a fee which is a percentage of the sales price. If you decide to sell the home yourself as the investment property owner, you can avoid paying these commissions and thus make more money from the sale.
- Total control over the sale – For Sale By Owner gives you complete control over the home sale. You don’t have to be concerned with other people’s opinions about how you will price your home, market it, prepare it for sale or negotiate with potential buyers.
- Commitment to the sale – Real estate agents often work with multiple clients at the same time. This means that the agent might not give full attention to the sale of your property. However, if you choose to sell it yourself, you can commit all your available energy and time to the sale. You can market the property extensively, talk to potential buyers anytime they contact you and show your home for sale by owner at any time of the day.
However, selling a home is hard work for any homeowner. Research by the National Association of Realtors revealed that more than 90% of FSBOs fail. That’s why it’s crucial to learn beforehand how it all works and the necessary steps to take.
How Does For Sale By Owner Work? 7 Steps
Here are some guidelines for selling a house without a realtor:
1. Prepare Your Home
Before listing your for sale by owner homes, you need to prepare them. Carry out a thorough home inspection to find out what is working and what isn’t. Anything that is broken or outdated should be repaired or replaced before showing your home in order to increase the property value. Preparing your home also involves getting rid of clutter that you don’t need. You can give things away or store them in an off-site storage unit. Don’t forget to clean your house thoroughly to make it appealing to potential buyers. A fresh coat of paint can also make a huge difference.
While preparing your home and working on repairs, pay attention to the property’s exterior. Working on things such as your landscaping, driveway, and lighting can help improve your curb appeal significantly.
Related: How to Sell Your House Fast: 11 Tips
2. Set Your Price
Setting a price for your property is one of the most important tips for selling a house. If you price the real estate for sale by owner too high, finding a buyer could be a problem. On the other hand, pricing too low could mean losing potential earnings.
So, how much is your house worth? One of the best ways of setting a price is by conducting a comparative market analysis (CMA) and looking at recent sales of similar homes in your neighborhood. Check sale prices for properties with comparable bathroom and bedroom count, square footage, and lot size. Proper pricing will allow you to start receiving offers immediately.
You can find real estate comps and perform a complete CMA with Mashvisor.
3. Create Your FSBO Listing
Many people ask ‘Where can I list my house for sale by owner for free?’ The MLS, FSBO.com, Zillow, Trulia, eBay, and the Mashvisor Marketplace are some of the places where you can list a house for sale by owner.
Your listing should contain the following details:
- Home data – This includes details such as lot size, interior square footage, year built, bathroom and bedroom count, and parking arrangements.
- Photos – The photos of your property are a crucial element of your FSBO listing. Take multiple clear photos of every room in your home, as well as the hallways, and the exterior. You can use editing software to improve the quality of the photos.
- Description – The description should highlight your home’s unique selling points. This will grab the potential buyers’ attention and enhance the chances of making a sale. If you don’t know what to write, read the listing descriptions of comparable homes.
4. Advertise Your Home
Getting your property listed and placing a for sale by owner sign in your front yard is not enough. You need to carry out a real estate marketing campaign in order to attract buyers. One option worth considering is placing paid ads on heavily trafficked sites such as Nextdoor and Craigslist. Social media sites such as Facebook, Twitter, and Instagram can also be very effective for marketing your property for sale. Alternatively, you could create a dedicated website for selling your home if you’re a real estate investor.
5. Hold an Open House
Once your home gets listed, consider holding an open house. To get an idea of how it works, visit several open houses in your neighborhood and take notes. You can schedule your open house for a weekend early afternoon or late morning. Though such events usually run for two to three hours, you can go longer if you wish. You can create awareness about your open house by posting on social media, sending out emails, distributing flyers around the neighborhood or using paid ads online.
Related: What Is an Open House? A First-Time Seller’s Guide
Staging a home is very important before holding an open house. Make sure your house is decluttered, cleaned, and properly staged. This includes moving furniture around, using lighting and mirrors to make rooms appear bigger, and using plants or art to make the home more appealing. Home staging creates a strong first impression.
6. Be Prepared to Negotiate Offers
Going for the FSBO option means that you will be acting as your own real estate agent. You should, therefore, be ready to field and negotiate offers with potential buyers. Take time to learn tactics that will give you an upper hand in the negotiation. For example, things such as your body language and even silence can work in your favor. Be ready to walk away if the potential buyer refuses to make an offer that is reasonable.
Related: 10 Best Real Estate Negotiation Tips for Sellers
7. Complete the Paperwork and Close the Sale
When it comes to closing the sale, you will need the help of a real estate professional. For example, you will need a real estate attorney or title company representative to ensure that all your paperwork is in order. Such professionals will ensure that your sale adheres to federal laws such as the Fair Housing Act. The closing costs are usually paid by the buyer.
Related: The Ultimate Checklist for Selling a House
The Bottom Line
FSBO has its advantages and with this guide, you can sell your own home confidently. However, if you feel your home is lingering on the market too long or you feel lost in the process at any time, don’t forget that there are local real estate agents waiting to help you.