Selling your home yourself can sound very financially appealing. No 6% commission to a real estate agent, no surprise visits or last-minute showings that you have to clear out for. How hard can it be? The reality of it is For Sale By Owner (FSBO or “fizz-bow” for short) can be very difficult.
It means mounds of legal paperwork, marketing the house yourself, scheduling showings, all on top of your current responsibilities. If you’re prepared for the stressful and turbulent road ahead, we’ve prepared this short guide to help you get up and running with the FSBO process.
What’s your property worth in the current market?
Homeowners have a large tendency to overvalue the desirability of their home and the sentiment that they have attached to the property can lead to an inflated price that is greater than the actual value of their home. What you need to do is act like a home appraiser and research comparable properties and local trends online.
Outside of paying for an appraisal by a licensed home appraiser, there are two sources that you can use for researching your home value. These two are:
Starting with AVM, this is what you get from online evaluation tools available through Zillow or Realtor. These tend to be inaccurate whether you’ve improved your home or not, however, they can give you a rough estimate of what your house is currently valued at.
Next is CMA, or what is known in the industry as “running comps”, this is when a broker (or in this case, the homeowner) look at comparable properties to find an average value of what the home will sell for. Brokers sometimes investigate pretty thoroughly when running a CMA, from looking at tax records to seeing what the historical sales data on the property is, as well as looking at other properties that recently sold and their historical sales as well.
Are You Willing To Deal with Buyers’ Agents?
While you’ve decided that you’re going to sell your house on your own. Most buyers will still be choosing to work with an agent, and they’re expecting to get paid a commission for helping their clients buy a home. Expect to pay around 3% in commission to the buyer’s agent if the buyer brings one.
Do You Like Sales and Marketing?
While it may seem like a walk in the park to sell a home, there is a lot that goes into marketing a home. If you’re planning to go the FSBO route, be prepared to perform a lot of the legwork that is normally done by a seller’s agent. This includes:
- Taking good pictures and writing descriptions about your home’s best features
- Making sure signage is visible with your contact information
- Listing your property on the MLS
- Creating fliers to advertise your property
This is only a small piece of the marketing done by brokers when trying to sell your home.
Can You Deal With People?
When you are acting as your own seller agent, you’ll have to listen to buyers potentially badmouthing your home as part of a strategy to drive the price down. So, you’ll have to have a thick skin when dealing with buyers tromping through your house pointing out its faults. Otherwise, you could be letting your emotions cloud your judgment and negotiation ability. Additionally, you’ll have to make sure that you can answer your phone or respond to emails at different times including during meals, business hours, and after-hours as well.
Are You Willing To Screen Buyers?
Normally, an agent helps to supervise showings to make sure belongings don’t grow legs and they weed out people who can’t get financing. When selling the home yourself, you are your first and last line of defense for your home. Always check any potential buyers’ identification when they arrive and make a note of their names and addresses. Additionally, make sure to check that potential buyers are in the process of getting financing so that way they’re not wasting your time.
As you can see, going the FSBO route can be an arduous and stressful route. Taking on the workload of a full-time job on top of your other responsibilities can be quite the undertaking. If you find that this isn’t the route for you, and you don’t want to deal with the long timeline that a traditional sale can bring, reach out to us! Let us work with you to find a beneficial solution for your home!