There has been an emerging trend in the housing market where homeowners are taking it upon themselves to sell their properties without the enlisting the help of a licensed real estate agent – a trend called “for sale by owner” or FSBO (pronounced fizz-bow).
At first glance, selling your home on your own seems like a great way to have more control on the process and save thousands of dollars by eliminating agent’s fees. However, successfully managing a complex and often emotionally charged transaction such as selling your property entails a certain level of expertise and composure.
Previously, we delved into the benefits and drawbacks of buying a FSBO home. This time, we will explore to see if selling your home without the help of an agent is the right strategy for you.
How do you sell your home without a real estate agent?
Selling a home involves several important steps that need to be handled properly to get the property off the market fast. If you are planning to take the FSBO approach, then the successful execution of these tasks rests solely on your shoulders. Here is a list of the things you need to do if you are planning to sell your home yourself.
1. Present your property in the best light possible.
When selling your home, creating a positive first impression is one of the most crucial keys to success. A well-kept home emanates warmth and is attractive to potential buyers looking for a place to call their own. To pique buyer interest and present your home in a positive light, make sure that necessary repairs are done before putting your home on the market.
Another way to make your property stand out is through home-staging. Styling highlights your home’s strengths while minimising its weaknesses. Home-staging also does not always have to be an expensive endeavour. While it is true that hiring a professional stylist can set you back several hundreds to even thousands of dollars, there are many ways to stage your home without the need to break the bank.
2. Set a realistic price.
Setting an unrealistic price is the most common mistake homeowners make when selling their property, according to many experts. Setting the price too high can limit the number of interested buyers and may cause your home to sit in the market for an extended period. This can hurt your chances of making a sale because if your house is in the market for too long, buyers may begin to think something is wrong with your property.
To come up with a realistic asking price, experts advise that you do research on comparable homes in your area to give you an idea on how much properties there are actually worth. It is also advisable to get a professional property valuation, so you can have an accurate estimate of your home’s value. Having an idea of how much your home is worth will enable you to market your property correctly and puts you in a good position when it is time to negotiate.
3. Market your home.
The first thing most prospective buyers do when they are searching for a home is to view online listings. Fortunately, there are several FSBO websites available where you can advertise your home for a few hundred dollars or even for free.
This is where good marketing comes into play. If you can afford it, hire a real estate photographer to capture your property’s best features. Professional photos often stand out online and can help drive enquiries. When coming up with write-up, make sure to provide an accurate description of the property, including the number of rooms, size of the home, and specific features. Do not leave out critical attractive points such as recent renovations. You can also include what amenities are nearby, including public transport, schools, hospitals, and shops.
4. Organise home inspections.
Conducting an inspection is one of the most crucial steps when buying a home, so you will need to organise times for interested buyers to come and view your home. If you have a day job, you may need to schedule inspection times after work or even take time off work to accommodate a potential buyer.
During the inspection, be sure to be ready to answer any questions buyers have about the house. This where being the owner/seller reaps benefits as no one knows more about the property – and perhaps the neighbourhood – than you.
5. Negotiating with homebuyers.
One of the biggest advantages of taking the FSBO route is that you can communicate directly with the buyer. This can give you more room to negotiate the sales price. Meeting the buyer face-to-face also humanises the transaction and may allow both parties to build a connection. This can result in a win-win situation for you and the buyer – the key is to keep an open-mind and be reasonable.
6. Finalising contracts.
Once you and your buyer have settled on price, it is time to finalise the contracts. There are two ways to go about this task – you can either do it on your own or enlist the help of a licensed conveyancer or solicitor. Both options have their share of pros and cons, and your choice should boil down to whether you have the time and capability to deal with issues that may possibly arise.
What are the rewards and risks of selling your home on your own?
Selling your home on your own has its share of rewards, but there are also risks involved. Let’s look at some of them:
Reward: You can save money on agent’s commissions.
Among the primary reasons why sellers go the FSBO approach is the potential savings that come from taking the real estate agent out of the picture. Let’s face it, enlisting the services of a real estate agent often comes at a steep price. On average, agents are paid between 2% and 3% of the final sales price of the property. So, if your home sells for $600,000, you will have to set aside about $12,000 to $18,000 on commissions for your agent. By selling the property yourself, you can eliminate this cost.
Risk: Your emotions can cloud your judgement.
Your home is place where a lot of memories have been created and selling it can be an emotionally charged process. If you cannot keep your objectivity throughout the transaction, then it will be difficult for you to find a buyer. The key here is too be flexible and to take any feedback constructively.
Maybe your heart is set on a specific price for your home, but if the market is indicating something lower, it pays to be adaptable. Keeping an open mind when examining offers can facilitate the sales process.
Reward: You have more control on the transaction.
Selling your home on your own provides you with more transparency and control over the transaction. It allows you to know exactly how many enquiries your home has received or the number of attendees at your open house. You can also receive buyer feedback firsthand and manage the expenses yourself. Additionally, taking over the process can sometimes lead to a faster sale since you are focused on selling your property only. In contrast, real estate agents handle several listings simultaneously.
Risk: You may not have the expertise to do the job properly.
Selling your property is a complex transaction that entails sufficient understanding of the housing market and the processes involved in the sale. If you do not possess ample knowledge about the industry and the selling process, then you are exposing yourself to costly risks by taking the FSBO approach. Remember, a lot of experience is needed for the seamless completion of paperwork and other legal requirements in the sale of your home. If you are ill-prepared to handle these, it may long delays and costly legal errors.