Know Before You FSBO
Faced with the prospect of forking over a hefty sales commission, you may find the FSBO route pretty tempting. Still, selling by owner isn’t as easy as sticking a sign in your yard and waiting for the offers to roll in -- according to the National Association of Realtors, fewer than 10 percent of home sales are open-market FSBOs. Even so, it is possible to sell your house on your own. Before you decide to ditch the agent, learn how to steer clear of the most common snags.
Don’t skimp on advertising.
When you’re watching your bottom line, you may be reluctant to pony up for advertising. But the more visibility your home has, the more potential buyers you’ll attract -- and that can translate into a faster sale or even a bidding war. Add directional signs around your neighborhood to lure in buyers who are visiting the competition, and design a flyer with your price, a few color photos and any standout amenities. You might even consider listing with a flat-fee MLS service, which will put your home into the local listing database for a fraction of what you’d pay a Realtor.
Do your prep work.
Getting buyers to your door is only the first step -- once they’re inside, they need to fall in love. A few simple changes can get your home into market-ready condition.
- Clean up as much clutter as you can; a messy house sends the message that you don’t have enough storage space.
- If you have time, repaint any brightly-colored rooms in a more neutral shade.
- Open curtains, put out fresh flowers and keep the toilet seats down.
- Take down family photos and clear off the front of the fridge. Personal mementos prevent potential buyers from envisioning the house as their own.
- On the day of a showing or open house, turn on all the lights to make your home bright and cheerful.
Safeguard your stuff.
Realtors only earn commission if they sell a house, so they’re not likely to waste time on showings unless their clients are serious about buying. But when your house is for sale by owner, you may attract more nosy neighbors and sketchy snoopers. When someone calls to request a showing, note their number on your Caller ID so you have a log of visitors. Before they arrive, stash prescription medicine and valuables in a safe place. And after a showing, check the windows and patio doors to make sure none have been left unlocked.
Play by the rules.
Even without a Realtor pulling the strings, it helps to keep your sale on the up-and-up. After all, knowing your real estate etiquette can help you avoid a few headaches down the road. Here’s how to make your FSBO sale as foolproof as possible.
- Make sure your listing complies with the Fair Housing Act, which prohibits discrimination against any potential buyer. (Even describing your home as a “bachelor pad” or “family home” treads in murky waters.)
- If title insurance and escrow aren’t in your vocab, a real estate attorney may be a good investment. The retainer isn’t cheap, but if problems arise, their help can be priceless.
- Consider offering a 2-3 percent commission if a buyer’s agent sells your home. If agents know they won’t make a penny by showing your house, you can safely assume they’ll avoid it like the plague.
- If the topsy-turvy economy has you worried about a buyer’s ability to close the deal, ask for a mortgage pre-approval before accepting a bid.
Selling by owner isn’t always the easiest option -- impatient sellers may ultimately wind up listing with a Realtor. But if you’re willing to invest the extra time, money and energy, a FSBO sale could leave you with a little more padding in your pocket.