8 For Sale by Owner Tips to sell house quickly & profitably
Do you know you have to pay about 6% of the final selling price of your house as commission to the real estate agents? The option of ‘For Sale by Owner’ seems to be a better option. But in reality, less than 10% of the houses in the US get sold by owner. It is because real estate agents do a lot of work on your behalf. However, here you will get to know some For Sale by Owner tips that would help you to sell your house quickly and profitably.
1. Is the Pain really worth the Gain?
All you get to save after taking all the trouble is about 3% of the selling cost. 3% commission to the buyers’ agent is still to be paid by owner. If the buyer has no agent, which is very less likely to happen, another 3% can be saved by owner. Thus, a maximum of around 6% can be saved by not using the services of a real estate agent. The commissions vary in different areas and you should check the same accordingly for your house. This amount can prove to be a difference between profit and loss in the sale by owner.
But, you have to spend a few hundred dollars to get the property listed on the Multiple Listing Service (MLS). The MLS helps you to market your house to other real estate agents who may help to get the buyers for it. If you are looking to hire a Real Estate lawyer for helping out in framing the terms of the transaction and handling the closing, you have to pay his fees too. Other miscellaneous expenses such as that of photography may also arise. Moreover, you have to invest your time and energy to sell the house yourself. Now you should calculate the total gain you would make in the whole transaction. You can decide whether the For Sale by Owner option is worth your sweating or not.
2. The first work is research
After you decide to go with the sale by owner, it’s the time to do some research. Search for similar homes in the neighborhood. Get to know about the prices prevailing in the local areas. Pull housing records at the computer. You can create a spreadsheet and fill it with the details about the houses in the neighborhood which were sold recently. Note the special features of those houses. Check the ongoing trend in the market.
3. Set the Price which is right
Sometimes houses are over-priced by owners. As a result, the buyers lose interest in the deal. So, the research becomes useful when you have to set the price. You can calculate the average cost per square foot of your house by comparing to the house selling prices in your area. Depending on the extra amenities available in the houses, higher prices may be charged by owners. You can also ask a friend for help. He can walk into the house and tell you about the price he would pay for such a house. These all things would provide you an idea about your For Sale by Owner deal. Price the house 5-10% higher than what you expect to get so that you can negotiate well.
4. Make the house look great so that buyers just can’t wait
The buyers get attracted to clean and spacious houses. Begin decluttering. Trimming trees, planting flowers, landscaping, replacing broken tiles, repainting faded walls and other such steps by the owner can increase the appeal of the house. Also, the house should smell good. Don’t spend too much money on repairs. It may become tough to recover the cost spent on them. Make improvements in the small things that would otherwise drive the buyers away.
5. A picture taken well helps to sell
It is said that a picture is worth a thousand words. When a picture of the house is taken by the owner, it represents a large portion of the stuff involved in the sale. It gives the first impression to the prospective buyers. Avoid unwanted things in the picture. The photos should not be dark. They should enable the prospective buyers to envision themselves living in your house. You can use the pictures as an effective tool on social media. They also prove useful while using traditional FSBO listing websites.
6. Consult a lawyer before accepting an offer
Consult your lawyer after the buyer makes an offer. Carefully read the offered terms and conditions. The attorney would help you to deal with the loopholes and the contingencies in favor of the buyer. He would guide to introduce new terms in the contract by the owner.
7. Preparation for inspection
The buyer may make a general inspection of the house so that he can have a good overview of the property. Some states require proof by the owner that house is termite free. You should make proper arrangements in the house before the inspection. You are also obligated to make repairs as specified by the buyer at the time of inspection. Remember that the buyer would do a ‘walk through’ of the property at the time of closing and determine whether the agreed repairs are completed or not.
8. Don’t be sensitive, remain positive
Some buyers visiting the house may make some nasty comments about it. Some people may do this intentionally so that they may not appear over-interested in buying the house. All these things should be taken lightly by owner. You shouldn’t turn rude or defensive in such situations. Also, selling a house requires time and patience. You should remain positive about selling your house.