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April 19th, 2007 by rosie · 4 Comments

We are moving soon and we’ll need to sell our home. Our plan is to do it DIY style: for sale by owner. Because we want all our equity and do NOT want to pay an agent’s commission, which usually is about 6%. If our home sells for $250K, that’s $15,000 out of our pocket to the agent(s) involved! There may be different options out there as far as how much commission real estate agents get, as some offices offer flat fee services or a service-based commission structure. But that’s not for us! We’ve sold our own home before, we’ll do it again, and we’ll tell you how.

You’ve probably seen ads for real estate agents and they make it sound very complicated and scary to sell you own home. After all, they are the licensed professionals who do this for a living. They know the laws. They know the current market. They have the resources for advertising and finding qualified buyers. They know how to read and write the necessary contracts. They can negotiate. They’re “the experts” and you should “leave it up to them”- at least that’s what they want you to think.

The truth is that selling your home yourself (and keeping your money in your pocket) is much simpler than they want you to think. I sold our first home in Fort Worth, Texas, and was surprised and relieved when it turned out to be much easier than the real estate industry implied.

Before we even thought about FSBO, we had an agent come in and tell us his plan. We called this particular agent because his name everywhere on “for sale” signs and we thought he must be really good. His game plan was for us to list at a very low price and he guaranteed a sale within a few weeks. While one of our main goals was a quick sale, we would not make any money after we paid his commission since we only had a little equity. So we decided to look into the FSBO alternative.

My husband worked full-time and went to school full-time, so I was in charge of it all. And I’m no salesman. I immediately began researching what FSBO entailed. I went to the library and checked out a few books. And I had access to all the information I needed via the internet. It was online that I found links to some local title companies; I contacted a few and told them what I was doing and asked for their services and rates. One company was extremely helpful, had very fair prices, and they even would come out to our house to close! We went with that company and I like to say they did all the work because whenever I had a question, I called them and they were happy to help me. We sold our house within 3 weeks of putting a sign in the yard, for a bit more than our asking price! We didn’t even put an ad in the paper. And it was much easier than you’d think.

Here’s what YOU need to sell your own home.

1. Know your market. You can easily know your market by searching your local MLS listings and seeing what comparable homes are selling for. You should go to open houses nearby and see what the competition looks like and check out asking prices.

2. Cover your legal bases. Find out what forms you need to fill out and get several copies of the documents. You can find what you need online after a little research, and your title company should be able to help you, too. Check and double check so you don’t miss any important documents.

3. Find a good title company. Call around and tell them what you are doing and get a list of services provided as well as prices. Finding a helpful, competent title company is extremely important. They can help walk you through the process if you have any questions. During this step, you should become aware of costs associated with selling your home, such as closing costs and other fees.

4. Prepare your home for showing. This is very important!!! Your home should be crisp, clean, and inviting. I won’t go into too much detail, as there are plenty of sources that will tell you just what to do. Some basics are putting 1/3 of your stuff in storage to de-clutter and open up space; paint in warm, neutral colors; clean, clean, clean; put away personal items and pets when showing; and make sure the house smells delicious during open house. These steps are crucial if you are to successfully sell your home.

5. Price your home appropriately. This part seems to be the hardest for most would-be FSBOs. Home owners have emotions associated with their home and that affects their asking price. Usually, the problem is over-pricing. Be objective in your pricing strategy. Price according to what the market says is a fair price. Remember, you want to be competitive. Don’t be greedy. But don’t under price your house, either. This is why it’s important to know the current market.

6. Advertise. The only advertising we had was a sign in our yard that had a canister where I put fliers with the relevant information. BUT, ours was an unusual case. Buy a sign for your yard. Make nice and informative fliers to post in local community centers, like the library. Advertise in your local paper. I suggest advertising on www.CraigsList.org. You can even get your home listed on the MLS for a flat fee, which can range anywhere from about $200- $600, depending on your market. Tell all your friends, family, neighbors, and co-workers because they all probably know someone who is in the market.

7. Show your home (to qualified buyers). Schedule open houses or make appointments with interested buyers, just like an agent would. Make sure the house is empty, excepting yourself, of course. Be friendly and helpful to those who come to see your home. I made sure all our potential prospects got a flier and I had a table full of relevant information: information on similar houses in the neighborhood that were also for sale, I had a Question & Answer sheet for those who might not know how to deal with a FSBO home, I had the blueprints to our home with all the measurements, etc. Brag about your home’s best aspects, but don’t be overly pushy. Allow the prospects to walk around a bit on their own so they feel free to inspect and discuss among themselves. It’s extremely important to screen your prospects to make sure they are qualified buyers, or you might be wasting your time. Ask if they are pre-approved for a loan and most will have a pre-approval letter.

8. Set yourself apart from your competition. You want your prospective buyers to remember your home favorably. If they are in the market for a home, chances are they have been looking and looking at many different homes and that’s why it’s important for you to set your home apart. There are many ways to do this: have fresh bakes cookies during open house; offer an incentive, such as a 1 year home warranty or a flat screen television; an allowance for some upgrades; offer to pay some closing costs; or $500 gift card to a home design store. Be creative with this part.

9. Be prepared for offers. If you have done all of the above steps, then you should start getting offers. Don’t be afraid to negotiate, either. You don’t want to jump at the first offer (unless it’s exactly what you want!), don’t be afraid to wait it out. When you do get an offer, make sure you respond in a timely manner. Maybe you need to discuss the offer with family, or a lawyer, but do reply as quickly as possible. Realize your main goals (fast sell, most money, etc.) and react accordingly. Don’t be surprised if you get an offer from an agent and know how you will respond. We had an agent make an offer for her clients, but decided to pass on that.

10. SOLD! You did it! You successfully sold your home and were able to keep thousands of dollars of commission in your own pockets! It required a little bit of work on your part, but it was so worth it! It was even a little fun and you know that you won’t ever need to pay those expensive commissions again.

[tags]sale-by-owner, real-estate, selling-home, fsbo, agent, commission, sell-your-own-home[/tags]

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    2007-07-04 00:46:39

    [...] Real estate commission. I am a very strong believer in doing it FSBO. Television commercials for realtor services make selling a home appear scary and overwhelming and [...]

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    2007-08-09 22:34:03

    [...] estate isn’t as hard or intimidating as it might seem. A few months ago, I wrote a post about us putting our house up for sale and doing it FSBO (for sale by owner). This is a follow-up post about some things we learned along the way and some important changes we [...]

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    Comment by Grants Pass Oregon Homes for Sale
    2008-10-25 16:17:40

    Everyone in the real estate business should respect those with an interest in selling their own home. Agents and Brokers should offer support to these brave people. The bottom line in any transaction is a very important thing….we can always hope for the best, but we must plan for the worst! That us ultimately what real estate professionals are for…helping sellers avoid the unforeseen! Check around in your new town looking for an Agent or Broker that offers limited service plans. Read the fine Print!!

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    Trackback by No Agent Property
    2011-10-15 21:54:22

    No Agent Property…

    [...]DIY- FSBO[...]…

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