Selling your house is perhaps one of the most significant financial decisions you have to make. It is by no means easy and requires extensive research to get your home on the market, prepare it for sale, and carefully negotiate with potential buying parties to get a good deal.
Selling your house yourself, also known as for sale by owner (FSBO), is a bit more challenging than selling your home via a realtor but not impossible and saves you from paying real estate commissions.
Below is a guide that can help you sell your house yourself and to maximize profits.
Know Your House’s Worth
When you go to a realtor, they determine your home’s value using a comparative market analysis (CMA). It’s pretty easy to do a CMA as it only requires comparing your house to similar ones sold in the nearby area.
Say you own a property with a certain square footage, bedrooms, and features like a garage or fireplace. You log on to real estate websites and find similar homes sold within the past 6 months or year. These houses won’t always have the exact same features as yours, but they can give you an estimate of the price per square foot, the value of a room, and the features you have. Get at least three estimates to have a good idea of your home’s value so you can list your place at the correct price, leaving room for negotiations with buyers.
Prepare Your House for Sale
You’ll be advertising your house for sale, where many buyers will come in and have a look at it. Potential buyers can use any defects in your home, such as paintwork, yard work, and minor repairs, to put pressure on you to reduce your asking price.
In this case, it’s best to take a proactive approach to prevent any lowball offers from potential buyers. If you can afford the minor repairs, it’s best to take care of them early on. If you can’t, make sure to get estimates from home renovators or other relevant professionals for these costs. It may even highlight any imperfections that you may have missed out on, giving you a better position to bargain with potential buyers if they highlight any defects in your home such that it won’t be a deal-breaker for them. You can show them these estimates and adjust the asking price accordingly.
Get professional photographs taken so that you can attract as many buyers as possible but make sure your house is clean and decluttered. Use the furniture and space to your advantage. Take many pictures from different angles to showcase how potential buyers can have an ideal living space with the features it boasts.
Listing Your House for Sale
Licensed real estate agents have the advantage of access to the Multiple Listing Service (MLS), a database that contains information on more than 80% of homes for sale in the US. Additionally, the MLS feeds information to other listing websites like Zillow, Realtor.com, and Trulia for more exposure.
Listing your property on the MLS would be the best way to reach a broad audience. You can contact a broker for entry only/ flat fee MLS packages where they only provide you with a listing and give out your contact information to interested buying parties for a small fee. Similarly, some websites also provide FSBO and MLS packages where they list your home for a specific period however they may only offer a few websites and their platforms for your listing and limit the number of pictures you can upload.
MLS and real estate are not the only ways to advertise your house to potential buyers. You can even take advantage of social media platforms, such as Facebook groups and Instagram pages, to promote your house. Even websites like craigslist might come in handy, but be wary of online trolls making sure you vet any buyer to gauge their seriousness.
You can also use traditional methods like flyers, word of mouth, for sale signs, and brochures to advertise your home to potential buyers in the nearby area. Who knows, perhaps a neighbor or coworker might be on the hunt for a home. Whatever mode of advertisement you choose, make sure to provide necessary details about your house and mention how potential buyers or their agents can contact you if interested.
Staging your House and Negotiating
An open house is one of the best ways to showcase your house to many people at a time. When advertising, make sure to tell people about this information so they can come and see your house but make sure that it’s clean and prepared for people to view. Do not accept any offers from potential buyers on the spot. Wait for all of them to place a bid, and then you can start negotiating.
Some buyers will give you a bid, and some may not be interested in what your home has to offer. Of the requests you receive, many of them will be way below your asking price. Make sure to weed them out and see if any buyers are willing to negotiate or not, and don’t go below the value your home has based on the CMA.
As mentioned before, your asking price should be higher than your home’s value to compensate for negotiations. Buyers will bid even lower prices than they can afford, so they too can leave room for negotiation. Having a higher asking price will get you your home’s market value in the worst case and will leave you with additional money in the best case.
Handling Paperwork
Before selling your house, you have to ensure that all your paperwork is in order, like mortgage information, deeds and titles, and tax information. Consult a real estate attorney if necessary. They can help you devise a contract and compile the documents for you so that the sale of your home goes smoothly.
You will also receive paperwork compiled by the buyer or anyone representing the buyer. Make sure you vet the information provided by having your attorney take a look at it. If all goes smoothly and the deal closes, the buyer or escrow agent will transfer money from the sale to you.