If you ask anyone who has ever tried to sell their home themselves, they’ll probably tell you that from the day the “For Sale by Owner” sign went up, the phone began to ring. However, they will likely then tell you that many of those calls came not from prospective buyers, but from real estate agents requesting to handle the listing.
The idea of not having to pay a commission to a real estate agent is attractive enough to any home seller to convince them to try to go it alone. However, many then find that due to all the complicated issues involved in the process, selling a home on one’s own can be a daunting challenge.
The key is to be adequately prepared. If you don’t take the time to prepare yourself and your home, your house could sit on the market far longer than you’d like. You’ll attract unqualified buyers who will do nothing but waste your time.
Soon, many unprepared homeowners become frustrated and consider giving up their dream of selling their home themselves. However, there are plenty of homeowners who manage to accomplish the lofty goal of selling their own homes. Keep reading to find ten tips on how you can be one of them.
1. Price it Right
Correctly setting the asking price is possibly the most crucial point. Setting your price too high can be just as dangerous as setting it too low. Home prices are determined by fluctuations in the marketplace, and not by the sentimental value of your home. To identify and set a realistic price for your home, objectively compare the price, features and condition of similar homes in both your neighborhood and in adjacent communities that have recently been sold. Also, take the time to familiarize yourself with the terms of each recent sale. Conditions of sale are often as important as price in today’s market.
Carefully budget your selling costs and prepare a net proceeds sheet to calculate an estimate of what you will walk away with once your house is sold. Not only will this motivate you but having this information on hand may come in handy if prospective buyers request an analysis of total buying costs.
2. Prepare Your Home for Sale
First impressions are critical not just for people. Make sure your home makes an excellent first impression by carefully inspecting your home. Try to view it through the objective eyes of a buyer and attend to details in obvious need of repair or touch-up.
3. Prepare Your Legal Documentation
Not surprisingly, there are many contracts and documents which you must assemble, complete and understand. Below is just a partial checklist of forms that you’ll need from prospective buyers, and for your own legal documentation:
- Seller Disclosure
- Mortgage Payoff
- Deposit Receipt
- Buyer’s Cost Sheet
- Personal Property
- Purchase Contract
- Property Profile Fact Sheet
- Closing & Settlement
- Exclusion List
- Sellers Statement of Representation
- Loan Application
- Property Survey / Plot Plan
4. Market Your Home Effectively
In addition to the “for sale” sign that will go on your front lawn, you will need to spread the word about your home. You have many options, from newspaper ads to targeted ads online; the important thing is to be service-minded in your pursuit of interested and qualified buyers.
Make it easy for pre-qualified buyers to learn about your home. Be willing to offer viewings of your home, and make sure someone is always available to respond to phone calls and emails.
5. Remain Objective While Showing Your Home
It may be difficult to do so, but it’s important to keep emotion out of the sale of your home. One useful tactic to resist the temptation to defend flaws or criticisms from potential buyers is to remain in the background as they explore. Give potential buyers the time and space to imagine themselves in your home, and let their own emotions take over.
6. Pre-Qualify Your Prospects
Don’t waste time with interested buyers who cannot afford your home. Research their financial stability before you work with any prospective buyers. Serious buyers will not be offended by your request for this kind of information, so don’t hesitate to qualify them before proceeding.
7. Negotiate Effectively
Many details go in to successfully resolving a home sale – make sure that you can explain any and all aspects, implications and responsibilities in your contract to your buyer.
Enlist your real estate attorney to help you get up to speed and consult with them before agreeing to any amendments to your agreement.
8. Know Your Buyer
Your primary objective during negotiations should be to control the pace and duration. Try to infer your buyer’s motivation. Do they need to move quickly? Do they have access to enough money to pay your asking price? Knowing this information gives you an advantage during negotiations because you will know up front what you will need to do to get what you want.
9. Don’t Move Before You Sell
Selling a vacant home is difficult. Empty houses look forlorn, forgotten, maybe even foreboding. It could also cost you money by implying to potential buyers that you are desperate to sell, which could result in low-ball offers.
10. Know Why You’re Selling… and Then Keep it to Yourself
The flip side of “understand your buyer” is to “understand yourself”. Your reasons for selling will come into play at every stage of the selling process.
Different goals will dictate different strategies; as someone who wants to save money by avoiding paying a commission to an agent, it is likely that money is one of your primary considerations; whatever your reasons, keep them to yourself.
Your buyers do not need to know why you want to sell, and telling them may put you at a disadvantage at the negotiation table. When asked, you may just say that your housing needs have changed.
How to Assess Your Net Gain
Before you begin taking steps to sell your home on your own, consider the fact that most buyers choose to hire a real estate agent because it doesn’t cost them anything for this service, as the seller pays the agent’s fee.
Be wary of buyers, investors, and speculators who seek out For Sale by Owner listings, as they are typically in search of a bargain and will work diligently to pay as little as possible. Low-ball offers from buyers like these often net you a much smaller profit in the long run. Keep the following in mind:
- 1. Consider what it will cost you to market your home, from beginning to end.
- 2. Determine what price you may expect as a For Sale by Owner seller. Is this amount higher than the rate an experienced agent could be expected to net for you, minus their commission?
If the task of selling your home yourself becomes more daunting than you anticipated and the time and energy involved in marketing and showing the house is not worth the money you are saving then it is time to enlist the help of a professional, which in many cases, you will find they pay for themselves by saving you time, frustration and advertising dollars.