The Process of Selling your House For Sale by Owner
The home selling process can be hectic either it’s a for sale by owner or by hiring a listing agent.
Selling a house for sale by owner can save you thousands of dollars but it can be an incredibly difficult road to navigate. Sometimes, it isn’t even worth the money a homeowner could save on agent commission fees.
Regardless of whether you want to sell your own home to walk away with more money or retain more control over the sales process, you need to do it the right way. We’ll cover the basics of what it means to sell a house by owner, including when it might actually make sense to do so.
So, here are the steps involved to get you to get started for selling your house as a for sale by owner.
1. Prepare your Home
Everyone freaks when they think about selling their home. Think small!
Many of the things that you can do are DIY friendly. Decluttering is one of the easiest and fastest ways to increase the desirability of your home – the best part is, it won’t cost you a dime.
Another high-value low dollar trick is to hire a stager. A two-hour consultation can literally eliminate the stress of deciding what stays and what goes.
A stager can also rearrange some of your existing furniture to enhance the flow and overall appeal of your home.
2.No Major Renovations
Forget about the big-ticket items. Renovating the kitchen and baths will definitely help to sell the home faster but they’re not going to necessarily get all your money back from that renovation.
Buyers just want to feel good about your home, they want to feel that it’s been well-maintained and cared for. They want to feel that they’re loving this home and they want to buy it.
So, fix those little things that can really go a long way to making the buyer feel good about your house.
3. Come up with your asking price
Now, this is more of an art than it is a science. When we’re pricing your listings, we’re basing it on our experience in the real estate industry, market research, and, most importantly, market timing. You need to figure out what your home is worth based on the current market value.
Your price depends on your timeline. If it’s one month, you’ll have to be more aggressive with your asking price, but if it’s a year, pump it up a little bit.
If you say, the guy down the street sold his house for 320 last year, a lot has changed since last year. So, you need to ensure you come up with a realistic asking price.
4.Break out the Rolodex
According to a 2015 National Association of Realtors Profile of home buyers and sellers, the report showed that eight percent of all home sold were sold without an agent and of the eight percent more than a third sold to someone they knew.
So, call or email your neighbors, colleagues, relatives, friends. Let everybody know that you’ve got a home for sale, it’s priced to sell, and you’ll be surprised at how many people could be interested in your home.
5. Go for Professional Photography
Your iPhone can work but it’s not ideal. Poor quality photos will never capture a buyer’s attention.
Since nearly every home search begins online, your photos should really pop out. Having ones that are just overexposed and the angles are funny can be detrimental and hurt the interest in your house.
You’re gonna have to shell out some money for professional photography if you really want to grab the attention of potential buyers.
6. Make Videos
You’ll probably need to make a video as well. Buyers love videos! They wanna see a virtual tour – a walk-through of the interior of your house.
If you just take a picture of the living room, the buyers will not be able to assess the layout of your house. They’ll be left wondering things like where is the kitchen in relation to the living room? Is the master bedroom off of the living room? They kind of want to see the entire floor plan.
Buyers these days are doing all of their initial research online. So, give them as much as you possibly can to help them feel like them really understand what the house looks like.
So, you need to consider having a video as well.
7. Disclose and disclose some more
This is the number one document that if not completed properly can literally wipe out all of your profits.
An omission is a LIE. Full disclosure is required both federally and by state law. If you’re not sure, just err on the side of disclosure and consult a professional.
Disclose all those things that you feel should be out in the open, like if you’ve ever had a leak or if you require flood insurance.
So, for example, if you know that every time it rains the window in the living room leaks because the seal around the window is not so great and you fail to disclose that when the buyers move in and there’s a first time there’s heavy rain and it starts leaking and the guy comes to fix it and says, “this has been going on for a long time.”, you’re gonna find yourself in a lawsuit most likely.
So you do not want to fail to disclose any material defects within the house that will later come back to bite you.
8. Get the Property in Multiple Listing Service
The Multiple Listing Service is the Realtor’s secret weapon. You have to get your property listed in the MLS.
Getting your property on the MLS is going to get you a lot of exposure. Spend 500 and get the syndicated package. It’ll go out to Zillow, Trulia, Realtor.com, etc. Falaya allows you to gain access to the MLS for a low flat fee.
9. Advertise your Property
Marketing is all on you. You’re gonna need more than a for sale sign in your front yard.
Make a leave-behind brochure that lists some of the features or benefits of the home or some of the upgrades. Include the MLS number in the brochure as well.
There are a couple of good resources out there that provide pre-formatted templates.
Consider advertising in the newspaper, running ads on Facebook, LinkedIn, and all the other social media platforms.
Needless to say, you are going to have to advertise your property if you want to get people to come to see the house.
The Cons of Selling your House For Sale by Owner
1. Bargain Shoppers target FSBOs
If you’re selling your house for sale by owner, the types of buyers that are going to come to see your house typically fall into the following categories.
- They are investors looking to buy your house for pennies on the dollar. They’re either gonna buy it and fix it all up and flip it or they’re going to keep it as a rental property but they need to get it cheaply in order to make it profitable for them.
- You will also get a lot of buyers who are not very creditworthy. They can’t get a loan, so they will try to negotiate their way out of having to pay the full amount. They will try to do a lease with an option to purchase. by renting the house from you and paying their monthly rental and when they fix up their credit score, then they’ll apply for a loan and buy it from you. This doesn’t help you if you need to sell your house in order to buy your next house as you need the down payment from the sale of this house to buy your next house.
2. Be available 24/7
You’re also going to have to be available to do all of the showings. So, if they want to come to see the house at 11 a.m, and you’re at work, you’re gonna have to figure out to either leave your work and come show the house or try to do it later in the evening. If you try the latter, it could be possible that they lose interest in your property and decide not to show up.
For sale by owner makes it a little difficult to coordinate the showings. You will have to be present for all of your showings. It is certainly not advisable to put a lockbox on your front door and give your code to whoever wants to see your house. You might come home and find yourself wiped out.
3. Pricing a home is challenging without the right tools
Real estate agents have various research tools to help them determine a list price that isn’t too low or too high.
Pricing your home too low can lead to a complete loss of funds, and pricing your home too high may lead your home to sit on the market for an extended period of time, leading to eventual disinterest from buyers.
At the end of the day, it’s completely up to you to decide whether for sale by owner makes sense for your market, your aim, and most importantly, your home. That decision may depend on a simple dollars-and-cents calculation or something more complex and subjective, such as your eagerness to take the time to market your property or endure the ups and downs of direct interactions with potential buyers.