Many people believe that in order to get the best price for their home they need to sell it themselves. Why pay thousands of dollars to a broker, for a job you can do yourself? Even though close to 25 percent of the homes sold last year were sales by owner, at least half said they would hire a professional the next time around.

You can absolutely complete a successful sale without a professional, but a homeowner needs to understand the risks, be organized, and just as knowledgeable about the sales process as an agent. In some cases, in order to achieve RealSuccess, you have to be willing to accept assistance from an expert in the field who can guide you in the right direction.

Here are some of the main points to consider before you make your decision to fly solo.

Property Value

Realistic pricing of your home is crucial to the successful sale of your property. If priced too low, you could potentially lose money. If priced too high, you may lose money after accumulated costs of the home remaining on the market for an extended length of time. Two years ago, when I sold my last home, there was a for sale by owner advertisement in the same neighborhood. The property was priced much higher than it was worth, and currently still for sale. Homeowners often price the home based on emotion and not actual numbers supported by surrounding home sales. Determining the value of your home involves an in-depth understanding of your market area. You can begin by doing comparative studies of similar properties that are for sale or that have sold recently in your area. It’s probably a good idea to hire an appraiser to give you accurate market value. 

Marketing

A good realtor will advertise your home on their company website, the MLS website, newsletters, and word of mouth. Realtors often have colleagues who have colleagues that are also in real estate who they can market your property to in order to sell faster. Electing to sell by owner means you have to compete with this strategy in order to effectively promote your property. Your marketing strategy needs to stand out amongst other realtor listings on the market.  The longer it remains for sale, the more it will cost you in advertising fees.  When marketing yourself, a good place to start is with online sale by owner sites that offer reasonable advertising packages. You may also want to offer a cash incentive for a sale initiated by a realtor; otherwise, you may experience scarce open houses. Utilizing a realtor’s contacts will bring more traffic to your open houses that will, in the end, get it sold faster than attempting to market on your own. 

Commitment

One of the key contributors to a home remaining on the market longer than necessary results from the owner’s lack of commitment to show the home regularly.  This includes organizing and promoting open houses. Allocate a specific amount of time on a daily basis for selling your home. 

Dealing With the Customers

Realtors have a way of effectively filtering out the serious buyers from the window shoppers or low-ballers. Independent representation means you will have to learn how to deal with customers and not fall for an offer that you’ll regret down the road.

Providing useful information to potential buyers will lend to your credibility. A realtor is always available in the wings for questions on financing options, costs of home repairs related to the purchase, recommendations for house inspectors, lawyers, etc. 

Meet the Professionals 

Get familiar with the inspectors, lawyers, or title representatives involved in your sale. You don’t want a delay in the process because you’ve chosen the wrong people to handle your sale. 

Knowledge of the Legal Process

Many deals have fallen apart due to inaccurate or incomplete paperwork. Have the necessary legal documents ready and know the process inside out. All financial incentives or inclusions need to be documented, signed, and dated; verbal agreements don’t count.

If this sounds like a lot to think about, it is. Don’t worry, many successful sales by owner transactions are completed every year.  These are homeowners who took the time to educate themselves on the process and details of an effective property sale.

Misconceptions

With the rising popularity of homes sold by homeowners, it has sparked some misconceptions that should be straightened out to clarify the process. The first thing we will look at is how financing works in the FSBO (For Sale By Owner) world. What occurs more often than it should is buyers thinking  “for sale by owner” means the owner is also offering to finance. Most of the time this is not the case. This misunderstanding is often identified among individuals with little or damaged credit. Some feel it’s in their best interest to avoid mortgage brokers and realtors. This is a huge mistake, mortgage brokers are experienced and trained to deal with individuals to help them repair their credit and obtain a favorable loan. 

It’s a good idea to seek out a mortgage company that is experienced, even specializes in the financing of FSBO sales. These companies differ from most mortgage companies in that their services are more comprehensive than most. They have expanded their services to include many things not usually covered by traditional mortgage companies such as closing contracts, title issues, and inspections. The closing of a home contract is one of the more confusing aspects of the purchase process and should be handled by a trained professional. Also, take into account that most mortgage companies rely on realtors to bring them the bulk of their business, therefore they are ill-equipped to provide educated FSBO financing.  It’s good to find an FSBO specialist mortgage company when dealing with someone who is selling their home themselves. 

Another misconception deals with the fact that the buyer is saving money by dealing with an FSBO situation. The truth is that usually, the seller is the one trying to save money on agent commissions. If they have subtracted the price of the agent from their asking price, it is possible to save some cash. This is hardly ever the case. Most FSBO sellers are listing their homes at market value as if an agent was selling the home. Then they attempt to do everything themselves and pocket the cash that would normally go to the agent.