How to Sell Your Own House

Selling your own home can save you tens of thousands of dollars in real estate commissions. The problem is, how do you do it?

Steps

  1. As soon as you decide to sell your home, start thinking of it and referring to it as “that old house I have to get rid of so I can move into my real home”: This will helpkeep emotions out of the sale. Many FSBO attempts fail because the seller is still too emotionally invested in the house to be objective about it.
  2. Value your property: You need to know just how much your property is worth on the open market. You can easily get this information about real estate prices in your area by entering your zip code information in an online database, or you can choose to hire a property appraiser. Know that a real estate agent is likely to try to change your mind. A little bit of research can really make this easy. Also realize that often Real Estate Appraisers may value a house under its true market value, due to established formulas and practices. Remember, your home is worth exactly what someone is willing to pay for it. You want to find the person willing to pay the most.
  3. Timing: Location is not the only key to successful real estate dealings. Obviously some home sales are forced forward due to circumstances that need immediate action for example a change of job or a divorce. But if you can choose when you go on the market then you are going to want to start the selling process when the demand for homes in your area is high. That will assure you a better price on your home. You also want to strike when economy is booming because people will pay more for the home than in a bad economy.
  4. Preparing your home: Presentation is everything in real estate sales. Home buyers are attracted to clean, spacious, and attractive houses. You are going to want to brighten-up the house and remove all of the clutter from counter tops, tables, and rooms. Scrub-down your house from top to bottom before you even consider letting someone inside of it for a tour. Would you buy a dirty house? You’ll also need to be sure you have the appropriate property disclosure forms required in your state. Remember, selling on your own does not mean you are not subject to all disclosure laws and you may be subject to legal action if you have not disclosed properly.
  5. Marketing your home: You can list your home for free on various websites to provide you with Internet exposure. Let’s face it; selling your home would be almost impossible if no one knew that it was on the market. You should also place some ads in classifieds and penny savers in your areas as well. Advertise with pictures as much as possible. Post signs on nearby busy intersections – but be sure to check local sign ordinances first. Fines from the city or county certainly won’t save you any money. Tell everyone you meet that your home is for sale. Ask the bank teller, the supermarket clerk, the dry cleaner, the barber, the person handing out bulletins at your church: “Do you know of anyone who’s looking for a home? I have one that’s for sale by owner. It would be a great deal for someone.” If you have a good school nearby, talk to the principal there. He or she may know of a family that’s been renting and looking for a house to buy in that school district. Since most buyers do use a Realtor to find a home, be sure to include that you are willing to pay a commission to buyers agents who bring a buyer to your home, otherwise you are alienating the majority of potential buyers. Also be sure to secure any valuables in your home. You are opening up your home to complete strangers – be sure you are prepared for any potential problems. You will also need to be available to show your home throughout the day. Buyers are very fickle, if your home is not available to be seen when they want to see it, well, there are plenty of other homes they can see right now.
  6. Utilize all your resources: Partner with a bank, title company, or mortgage broker who can provide a 24 hour hotline for your home, or one that has a website. Most buyers of FSBO homes don’t start out “looking to buy”. They think they are “just looking” but the price, floorplan, or timing make the deal look too attractive to pass up. A FSBO hotline or web site will feed leads to whomever provided you with the hotline. In return, you won’t have to answer the phone during dinner, won’t ever forget a “selling feature” of the home, won’t ever miss a call, and should receive an email with each inquiry so you can follow up whenever it is convenient for you. The recording encourages “looky loos” to inquire without wasting your time. Selling a home is a numbers game, so the more people that know all the great qualities of your home, the better chance of them telling a friend or family member that your home is for sale and is a great buy. Make certain that you can get a list of all the callers in case you want to adjust the price or add a new feature.
  7. Home inspections: Many standard real estate contracts are going to give the home buyer the right to inspect your property so you are going to need to be ready for this, including pest inspections. Have your home inspected before you advertise. Under a general inspection you might be obligated to make major repairs to appliances, plumbing, septic, electrical and heating systems etc. You can expect your home’s roof and foundations etc. to be inspected too. Any recommendations that are made, do them all! Additional inspections requested by the buyer are customarily at their expense.
  8. Financing: Most sellers assume that the buyer has been through the process and know the stages of buying a home. The fact is, that this is one of the many valuable services that a Realtor would normally provide, but now it is left to You, the seller, to walk them through choosing a mortgage broker to getting to the closing table. By aligning yourself with a local mortgage company first, you are giving the loan officer leads in return for assisting you with the transaction, a virtual win-win. Mortgage brokers often have clients that are approved but have yet to find a home; this is a great way to tap into their client list to find a qualified buyer. The broker should also estimate the closing costs for your home and give you strategic financing tips for marketing (Zero Down, 2-1 Buydown options, Interest only options or community funding & grants available). Financing can sell a home just as quickly as good staging.
  9. Know who you are marketing to.
  10. Take an honest assessment of your home and determine who is most likely to be your buyer. Is it an investor, first-time homeowner, executive, or empty-nester? Once you have pinned down the buyer, market to them heavily.
  11. Closing: When it is time to close on an offer that a buyer had made, take the offer to yourlawyer and have a deal made. If you don’t like the buyer’s offer, don’t just say no. Alwaysmake a counter offer. If you can’t come down in price at all, offer to leave all the area rugs or the washer/dryer. What have you got to lose? And you might just make a sale! It’s better to buy a new washer/dryer than pay 2 or 4 or 6 more months of mortgage payments on a house you don’t want to live in anymore.

Tips

  • Selling Under Pressure: Occasionally, selling your home quickly is not an option. It is now when you need the right techniques that you can use to sell your home, without looking desperate and making yourself a target for buyers who are looking for cheaper prices. You should know all that there is to know about the market before you start listing and work with the right real estate professional. Just don’t settle for the first offer.
  • Make Home Improvements: In some parts of the country you can add considerable value to your home by making certain improvements like building a gazebo, adding to your deck or porch, or even making a pond in your yard. Things like this may add value to a home depending on where you live. Ask around before you improve, though. The three most valued returns on your money to price of the home are in the kitchen, bathrooms and windows. Other, more cosmetic improvements are not to be ignored, but try to make a calculations as to whether and investment of X dollar will yield an X+Y dollar return. If it does not, these improvements may only speed the time it takes you to sell the house.
  • Never lie about Property Flaws: Property disclosure laws may mandate that sellers list any flaws in the home that are required by your state. If you are unaware of flaws or make an effort to cover them up, you can risk losing the sale and finding yourself in court. Simple rule of thumb, just don’t lie.
  • Some Realtors will offer to help you through the process in the hope that, should you not be successful, you will work with them.
  • If you need to sell a house quickly try a company like Expert Home Offers. They (and other companies like them) connect you with local real estate investors who buy many houses each month. They will typically not be able to offer you top dollar for your home but they will purchase it fast. This service is probably best for people who are going into foreclosure, need to move quickly because of a job transfer or something like that.

Warnings

  • Many mortgage brokers will tell you what you want to hear to get you to commit to working with them. Many of them probably read resources like wikiHow. There are many really great mortgage brokers out there. The best way to find a good one is through a referral from someone in the real estate business. Be careful there though too, that person, as previously referenced above, may want to talk you out of selling your home on your own.
  • According to NAR, the National Association of Realtors, the majority of properties offered for sale by their owners end up being listed and sold by Real Estate Brokers. The most common reasons for most FSBO (For Sale By Owner) failures are overpricing the property and since most buyers work with real estate agents, potential clients may not see your property.
  • Most buyers know you are not paying commission to a Realtor and will offer you a price that has been reduced by the commission it would have cost to use an agent – effectively eliminating any cost savings.
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This entry was posted on Friday, November 25th, 2011 at 5:38 pm and is filed under Real Estate. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.