Are you on the fence, deciding whether you should list your property as a For Sale By Owner?
It's a tough call, especially for first-time FSBO sellers. The prospect of saving money and selling the house within your chosen time frame is worth heavily considering. Your rules, your asking price, your open house schedule—the process is yours to do with as you please.
Watch the short video below for a starting point, then read on for more tips!
1. Research comparable homes and your local real estate market.
You’ve likely watched the for sale signs in your neighborhood go up and down, diligently tuning in to see the initial asking price ultimately turn into the selling price. This is a good first step. Finding comparable homes near you offers valuable insight into current local market conditions.
Establishing baselines or trends could be problematic if home selling is slow or the market is moving quickly. Hire an appraiser for accurate calculations to stave off doubts about correctly pricing your home for the quickest turnaround and best price.
2. Budget for home selling fees.
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Budget for more time than you initially think. For everything. From gathering your list of professionals to weeding the lawn, time-consuming (and probably money-consuming) hiccups will pop up along the way.
Military homeowners typically try a FSBO because they’re interested in saving money. It's best to use a budget tool to manage expenses through the selling process. Home selling fees add up, and they aren’t cheap. Legal fees, fees attached to the buyer’s agent, and taxes on capital gains are critical concerns to factor into a FSBO budget.
Other possible fees include escrow company payments, mortgage, home appraisal, termite inspection, property transfer tax, home warranty transfer, and title insurance. Hiring qualified professionals could help save money and protect you from legal disasters.
Our free guide below, For Sale By Owner FAQs, will help you learn more about what to expect when preparing to sell your home.
3. Clean and repair the interior and exterior of the house.
Cleaning sounds like obvious advice. And it is, to a degree, but what owners think clean and repaired means (especially if you're trying to save money) doesn’t always sync with what buyers consider home sale-ready. Leaky faucets, loose stair railings, and other nuisances your family puts up with daily need repairs.
To satisfy buyers wanting immediate occupancy and who are willing to pay for convenience, the property must be virtually move-in ready. Most features benefit from an update or thorough cleaning. Don’t be surprised if one chore grows into a larger project that generates numerous related to-do lists.
Exterior Clean-Up Tips
Curb appeal is powerful. It draws online views and encourages buyers to exit their cars on open house day. Don’t be fooled by the idea that buyers can get past a little manual labor. Unkempt yards and dirty siding are solid predictors of drive-by viewings only.
However, some buyers might be willing to look past an ugly yard if there is an attractive price. As the homeowner, it's a gamble that you have to calculate. Also, first impressions are hard to change when showing a home. The interior might wow buyers, but they’ll never forget the work needed outside if it's unappealing.
This is a basic list of how to clean the exterior of your home.
- Power wash all surfaces that can stand the intense stream.
- If the house doesn’t need a complete paint redo, touch up the exterior color.
- Remove and replace dead plants.
- Manicure the yard.
- Replace a broken mailbox, gutters, or railings.
- Front doors and entries make or break sales.
- Trim trees and shrubs for a clear sight line to the house.
- Clean pet areas.
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Interior Cleaning
There are two significant offenders most buyers cannot look beyond, even for a lower price: cleanliness and odor.
Theoretically, both are easy to fix, but the added manual labor turns buyers away. It's up to you to do the fixing for the price you’re asking.
It's a good idea to leave the house for a couple of hours and remind yourself to take a couple of whiffs upon re-entering. Is there an odor? If you have a friend who will tell you the place smells like cat pee, that's even better. Pet odors are usually the worst offenders. Other turnoffs are food, “old house smell,” and dampness.
Clean isn’t relative. If there is dirt or grime, clean it. From light fixtures down to baseboards, it all has to go. A good scrub will also help with odor removal. Homeowners often forget closets and appliances, but buyers will investigate to inspect for wear and tear and how much life is left.
Depersonalization is important. This process requires you to check your emotions at the door. Remember that you’re attracting all buyers, not only those with your taste in furniture.
You might need temporary storage if your living spaces appear small (thanks to too many objects or a poor layout). Small decorating items like photos, artwork, and knick-knacks also belong stowed away until the property sells. The goal is to show buyers the home has the potential to showcase their belongings.
Don’t be surprised if your housing market requires professional staging. Home stagers are trained to enhance even the most difficult of properties. Their services range from an evaluation and advice to installing furniture to show off your home’s full potential. Stagers often prescribe a neutralization strategy involving neutral paint and wood or wood-like flooring.
4. Create a captivating home listing.
Don’t expect crowds of interested buyers if you skimp on your home’s advertising. Real estate shopping is predominantly online now with real-estate advertising sites like MilitaryByOwner and social media, whether homes for sale by owner or those listed by agents. If you’re late to the technology game, it's time to jump in.
Buyers are browsing on their phones at all times of the day and scheduling appointments beyond traditional Sunday open house hours.
Start with the tips in How to Create an Unforgettable Home Listing!
High-quality photos are an essential factor, possibly from a hired professional, and so is a thoughtful summary of your home’s amenities. Taking photos and writing a listing will take a few rounds of editing; the “one and done” technique isn’t effective. Instead, give yourself time to play with your camera’s features and write a description that does your home justice. A second set of eyes will catch grammar mistakes and bathroom pictures with the toilet seat up (*shudder*).
Did you know you can list your home on the MLS (Multiple Listing Service)? Yes, you can, but there is a fee, and if a buyer uses the MLS to buy your home, you’ll have to pay a commission. The MLS is just another option for your overall selling strategy.
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5. Decide your home showing style.
Instant gratification is changing the way buyers think of shopping for a home. Yes, they will attend open houses if they meet their schedule, but offering the option of different times of the week could snag a great offer. These days, Sundays aren’t just for church and open houses but for travel, soccer, baseball practice, and vacations.
A For Sale By Owner entitles the homeowner to design a show schedule that works for them and the buyers. Deciding how much time and energy you want to commit to keeping the home pristine and in show condition while keeping the kids and pets away is up to you.
Top 5 DON'TS for Your Open House will give you more detailed info on holding your open house.
Embrace feedback from your open house guests, either written or verbal, and seriously consider their opinions. Small changes could make a big difference, especially if an interested buyer walks away that day. If you make improvements, a quick phone call letting the buyer who got away know that you heard their concern and rectified the issue could change their mind on whether or not to submit an offer.
6. Prepare for closing.
After verbal negotiations (nothing is official until the paperwork is signed!), the buyer should present an Offer to Purchase. Here’s where the necessity for a carefully chosen closing agent comes in. You’ll trust them to handle multiple tasks as they see the closing process through.
Real estate professionals highly recommend working with buyers with a pre-approval letter in hand before getting in too deep, so your buyer should expect this requirement. You’ll avoid wasting time and energy if you request it at the beginning of the process.
Reading the offer and subsequent counteroffers requires businesslike contemplation. You don’t have to take the first offer made, but use your CEO’s point of view as you read each one. At first read, the buyer’s offer might include specifics you find somewhat offensive to your personal style, but if the request benefits your asking price, shake off the thin skin and get to signing!
After some back and forth in the negotiations, the contract is submitted to your closing agent. Your agent will ask for required documents such as appraisals, title searches, and termite inspection reports. After all the paperwork is in order, the official transfer of ownership is the last step of the closing process!
In closing, remember:
Due diligence prep work isn't glamorous or fun. But it's necessary for a successful For Sale By Owner.
A home sale is a legal transaction that requires in-depth documentation: property assessments and surveys, declarations, covenants, or deed restrictions are just the start. Pest and environmental inspection results, statements from property taxes and utilities, and receipts from home maintenance and upgrades are all typically surrendered to potential buyers.
Understand your legal requirements.
Many states require the services of real estate attorneys, but a closing agent and an experienced home appraiser are also usually well worth their fees.
Your first FSBO is bound to come with a learning curve and some missteps. However, arming yourself with a thorough selling education is a solid move in the right direction.
Read Avoid These 3 For Sale By Owner Mistakes for an even bigger advantage, then download our free guide below created for FSBO sellers.
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