Are you considering selling your home "for sale by owner" (FSBO) instead of hiring a traditional agent in order to save money? Here are a few owner tips to help you navigate the process.
Price Your Home Appropriately
Setting the right price for your home is crucial for attracting buyers and getting a quick sale. FSBO sellers need to invest considerable time researching comparable sales in the area to get a sense of what similar homes are selling for.
When you're selling your own home, it's easy to overestimate what prospective buyers will pay. It may be wise to consult with a few friendly real estate agents to get a couple quick valuations of your property. Even paying a small flat fee to an agent may be worth it, just to have them perform a comparative market analysis using recent sales data. You want to set the ideal listing price in order to achieve a successful home sale.
Prepare Your Home for Sale
Make any necessary repairs or updates to your home to increase its appeal to interested buyers. This may include cleaning, decluttering, and staging the home to make it look its best. You should absolutely consider hiring real estate photographers to capture your house at its very best. Don't try to hide any issues; it's better to address them earlier in the selling process than get caught in a pickle during escrow.
Market Your Home Effectively
Marketing your home effectively can help increase its exposure to potential buyers. This may include listing your home on FSBO websites, using social media, and creating a brochure or flyer with photos and details about your home.
This part is extremely tricky without the guidance of a top real estate agent. You won't have access to the MLS (multiple listing service) to post your home, nor will you have other finely sharpened tools to spread the word in the greater real estate market. You can host open houses, but usually it is advantageous not to be present at your own house when buyers tour it.
Perhaps the best tactic you can use to boost your marketing is to offer slightly higher buyer's agent commission than a standard 2.5% rate. As an FSBO seller you want to motivate buyer's agents to bring their clients to see your home. Of course, if the goal was to avoid paying real estate agents than this idea runs slightly counterintuitive but it is certainly an option.
Be Prepared for Legal Issues
Selling a home involves a number of legal issues, such as preparing and signing a contract, disclosing any defects in the property, and transferring ownership. Consider consulting with a real estate attorney to help you navigate these issues.
Here is where FSBO sellers must be extremely careful. There are a ton more nuances than just agreeing the selling price. Furthermore, most buyers will have a real estate agent acting on their behalf who understands all the paperwork of a legal transaction. You don't want to be outmatched. Have a real estate attorney take a quick look at your documents to make sure there aren't any red flags or ticking time bombs.
Negotiate Offers
When you receive an offer on your home, it is important to negotiate with the buyer to arrive at the best price. Be prepared to compromise and consider the terms of the offer, including the closing date and any contingencies. In a home sale by owner, it's usually understood that the owner-sellers don't have a ton of negotiating leverage -- they aren't professionals by trade!
Be firm but fair with the buyer's agent. Be prepared to justify your listing price using your previously compiled market analysis. Continue to negotiate with other buyers as that will give you more ammunition in each negotiation; the more bidders the better! If you work diligently, you can achieve the home sale you desire!
Conclusion
Selling your own home can be a challenging process, but with careful preparation and a little bit of luck, it is possible to sell your home without the help of a real estate agent. An FSBO seller must set the right listing price, perform necessary updates, creatively market the property to buyers, prepare for contractual issues, and negotiate competitive offers. If they can accomplish those things, home sellers can find success in the FSBO process.
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