Saving money is a very good thing.
The reason most people want to sell their house without a real estate salesperson is to save money. And I think you are wise to consider selling your house yourself.
But, selling your house yourself isn’t easy and it isn’t for everyone. The proof of this is that upwards of 87% of all For Sale by Owner homes are eventually listed with a real estate salesperson.
You’re probably suspicious because I’m a Realtor® and I’m endorsing you to consider selling your home yourself.
And you should be. This blog isn’t a sneaky sales pitch about why you should list your house. This blog is about you selling your house and saving.
I make living selling houses. And I do it differently than most if not all other real estate salespersons. I have a Perfect Home Finder search program whereby I find pre-market and unlisted homes for buyers. So, I’m interested in your home as a prospect for my buyer clients. I do… wish you the utmost success in your sales effort.
So, it’s time to sell your house and you’d like to do so without a real estate salesperson.
The tips in this blog can provide a good blueprint for you. And at the end of the blog, you’ll be able to download a free guide, “Home Seller Tips and Doing It On Your Own“, that I’ve created that will help walk you through the process.
There are definite steps you’ll need to take to get good exposure for your home among all the competition out there.
You’ll need to do some things once you’ve got people responding to your marketing, especially once you go under contract.
And there are things you’ll need to be on the lookout for and guard against.
So, I’ll briefly touch on these three elements in this blog. The free guide “Home Seller Tips and Doing It On Your Own” that you can download goes into much more detail. Click on the link below.
Preparation
When I was a new Realtor® a home sold in my neighborhood in just a few days, at a time when the average number of days on the market was about 3 months. And it sold for a record cost per square foot. After it closed, I called the owner and asked how they had managed to sell so quickly for top dollar. Had they re-painted? Staged? What had they done special?
The owner replied that all he had done was power wash the drive and sidewalk. But after I probed a little more, I found out the daughter was an interior decorator and she had helped prepare the interior. And the son-in-law was a landscape architect and had re-done the landscaping and flower beds the year before. In other words, the appearance of the home was immaculate.
Before you put the sign in the yard, make sure your home is well prepared. Use a critical eye to view everything and fix anything that needs it.
Clean, clean, clean.
Your curb appeal is super important. If that’s lacking, it will be really hard to get people in the door to look at the house. You only get one chance to make that first impression. And this is it.
Watch a bit of HGTV to get ideas about staging and what’s currently trending.
The most important staging tip is to empty about ½ of your stuff into a storage locker.
Not looking cramped and crowded is important. And when you move, this much will already be boxed up already.
Professional photography is really essential. It will cost you a few $100 but I can’t stress enough how critical this is for all of your marketing. Most of your prospects are going to eliminate you based solely on your photographs.
Before you go live, you need to make sure that you have all the required documents on hand.
It’s safest to hire a real estate attorney to make sure that nothing gets overlooked. But if you choose to do it yourself, as a minimum you will want a Residential Purchase and Sale Agreement, a seller’s disclosure statement, and lead-based paint disclosure. You should be able to find these forms online or you can get them from an attorney. You also need to order a title report from a title company. An attorney can clarify any additional forms that you might need.
You’ll also want to familiarize yourself with the terms of the buyer’s sale agreement, contingency periods, and requirements. These will normally be in the areas of loan appraisal and a physical inspection. If something isn’t satisfied within the contingency period, the buyer will have the right to cancel the contract.
Another thing you might want to consider doing is getting a home inspection by a certified inspector before you put your home on the market. So that you can fix any issues ahead of time that could otherwise cause a stumbling block in your negotiations. This is probably going to cost around $450 or so.
Pricing
Pricing has elements of both art and science.
In order to determine the correct price, find three to six comparable properties within about half a mile of your home that sold within the last six months. They should be similar in size, amenities, and condition. Calculate your price based upon what they sold accounting for any differences in condition, size, or amenities.
The appraiser will use these sold comps when evaluating your house for the lender and in many instances create a cap on your house’s value. In a rising market, they provide a base to work from. In a falling market, the sold comps are less helpful.
The housing market is similar to the stock market in that it doesn’t matter what Tesla stock sold for last year or last month. It only matters what a buyer is willing to pay for it today.
You can, and should look, at homes that are currently on the market to get an idea of what your competition is like. But you can’t actually use the listed prices in your price calculation.
They are useful to know as your upper limit. Because if a comparable and nicer house is priced below your house’s price, your house is not going to sell at its higher price.
You will probably err on the side of overpricing. But don’t feel alone, many more homes priced by real estate professionals have price reductions than price increases. We are all a little too optimistic when it comes to pricing.
Determining the market value of your home is very difficult. The housing market is fluid and changes daily because it is ruled by the Law of Supply and Demand.
The good news is once your house is on the market, it isn’t hard at all to tell if you are priced correctly. If you’re not getting any lookers, you are either overpriced a lot or your marketing is terrible. Or both. If you’re getting traffic but no offers, you’re probably priced a little too high.
If you’re getting offers, you’re priced right. Now you can negotiate.
Homes sold by real estate salespersons have historically sold for about 18% more than homes sold by owners. This is directly tied to the Demand side of the equation. Real estate salespersons typically do a better job of marketing a property thus increasing demand which is rewarded by higher sales prices.
The content of this blog is evergreen. So, you may be reading this blog long after 2022 when I wrote it. In hot markets like 2020 & 2021, FSBOs didn’t have to do much marketing other than stick a sign in the yard.
As time progresses and the market shifts back to a more balanced market, For Sale By Owners are going to have to up their marketing game to compete with the other homes for sale.
Getting the price right, to begin with, is very important. The longer a home sits on the market, the less interest it gathers. And after a while, buyers begin to wonder if there is something wrong with the house because it is still for sale.
Once upon a time, people overpriced their homes to leave room for negotiations. That doesn’t work anymore and hasn’t for a while. Buyers are typically much smarter consumers today. They have greater access to home values on the internet and are much more inclined to walk away than spend time making and negotiating an offer below the asking price.
You might want to get a professional appraisal done ahead of time to make sure that you’re in line with what the market will bear.
Watch Out For
Now. What to look out for?
You shouldn’t be surprised that you will get a lot more calls from real estate salespersons than buyers. After all, they want listings and you gave them your telephone number.
Some will tell you that they have a buyer and they want to come by and see your house.
Most of them are actually just trying to get a foot in the door so that they can get you to hire them. If the promised buyer sounds too good, you might ask them to actually send you a copy of the pre-approval from their buyers’ lender.
Watch out for wholesalers, flippers, and investors. You’ll always get lowballed because they’re looking to get the best deal possible for themselves.
Also, watch out for seller financing requests. These buyers are not usually financially qualified and are not able to get a loan from a lender.
Be wary of anyone who is unwilling or unable to give you an escrow deposit.
Open houses sound okay. But open houses can be dangerous to the safety of your person and possessions.
Before you decide to do one. Please understand why many real estate salespeople hold houses open.
You probably think it’s to sell houses. And if you think that, you are only partially correct. An extremely small percentage of houses do sell as the direct result of an open house. So, if they don’t expect to sell a house as a result of an open house, why do salespeople hold houses open?
Sometimes the owner wants to have an open house. Sometimes it’s because the owner isn’t getting any lookers and it is considered evidence that the listing agent is “doing their job”.
But consider this. Salespeople are always looking for new customers. And open houses are an extremely cost-effective way to meet prospective buyers. You don’t need to meet buyers to sell them future houses. Why should you hold your house open? Is it worth the risk?
If you receive an offer, before you accept it, have it reviewed by your attorney to make sure that it’s all on the up and up.
At some point, you want to think about whether you are willing to pay a real estate salesperson to bring you a buyer. You will likely need to pay a 2-½ to 3% commission to them.
And just be aware, that they are representing the buyers’ best interests, not yours.
Wrap Up
That’s it in a nutshell.
Click on the link to access my free guide. “Home Seller Tips and Doing It on Your Own“. It provides you with many more in-detail tips for selling your home.