Hi!
We want to sell our house and build this summer. We've been doing all the prep - decluttering, painting etc. We have interviewed 3 different realators and were kinda impressed with 2 of them. Problem is, we don't want to give away that much money - they are talking 6%. I would rather do the leg work myself, sell the house for cheeper (which might make it sell quicker) and still clear the same money. We stuck a sign out in the yard last Sunday and have already had 2 calls - we live on a somewhat busy street in the neighborhood and our house is one of the biggest and definetly has the biggest yard at 1.33 acres where as the other houses are on lots and half lots. My question is for all of you that have done the FSBO, how has it worked for you? I know we can advertise on the FSBO website for a small fee and Craigslist for free. Who does the paperwork if a realtor is not involved - like the closing papers etc ?? Any insight from those with experience would be helpful. Any other creative ideas to advertise?
Thanks everyone so far - keep em coming! We do plan on having an inspection before we show the house. We already have a good idea on list price from the 3 realtors that we interviewed and comps etc. I was thinking that if we find a strong potential buyer on our own, then we could approach the realtor and negotiate the % to "seal the deal"??
Jen S. - so funny - that's what we do when we have garage sales. We have friends over and park cars by the road! Great idea!!
We bought a FSBO and it was relatively painless.
Get a good closing company and they can guide you through what you need to do.
Also (and they don't tell you this) but the % charged by a realtor IS negotiable. Some "won't" budge on the %, but newer agents will.
Don't do it. The part that you're doing - the marketing - is the easy part. Anyone with half a brain can spruce up, list, and show their own house. My husband and I did and we got lots of traffic and a couple of offers.
Where we fell down - and cost ourselves a ton of money in the long run - was in the negotiations. Our first serious buyer had some reservations about some things on the inspection that were fairly routine and that any realtor could have worked out. We simply didn't have the expertise, or the relationship with our buyer, to smooth those things over. They ended up walking away from the deal, so by that time the house was on the market for a few months and after that long, people start to wonder what's wrong with it. We had to drop the price $50K (17% off of our original price) and then still had to hire a realtor to get it sold. The buyer who did end up taking the house had the same concerns that the ones who walked away did, but the realtor was prepared for those and got those to be non-issues. Overall, we ended up netting 20% less than what we had hoped for. We should have just hired a realtor from the beginning.
If you do decide to go forward on your own, keep a couple of things in mind:
1) Have a thorough inspection done before you list so you aren't surprised by anything that the buyer's inspection might find. We had only owned our home three years when we sold it so we thought that we knew everything from our own inspection and the buyers' inspectors raised concerns that we either didn't know of at all or thought were minor.
2) Pay for an appraisal just as you would if you were buying your own home again. Your buyer will have their own done to go through the mortgage process and you have to make sure that you're not listing above what a lender says your house is worth. This will cost appx $300-$400 but it's better than getting and offer and having the appraisal come in too low for your P&S price.
3) You will need an attorney to review your offers, counter offers, purchase and sales agreement, etc. Your attorney will be involved all along the way and at the closing.
4) If you are FSBO you can't list for as much as you would with a Realtor and pocket the difference. Anyone buying a FSBO will calculate that you are not paying a realtor 6% and will knock that off of the list price. They will be looking at your property because they want a good deal. Use Zillow or another service (I think I used ZipRealty - don't know if that's still around) to track recent home sales and make sure that you price your house below those comps to get it to sell. Anyone buying a FSBO will be at least as savvy as you and has access to the same information regarding recent sales, comps, etc. so you can't do this and try to BS you buyer into the same price that you would get with a realtor. They are basically looking to get that 6% themselves via a lower price or maybe split it 50/50 with you so that you are both saving 3%.
We bought a FSBO, and it was a pain because the owners did not know anything about how to sell a house, and getting them to negotiate the contract, schedule appraisals, inspections, etc was a nightmare. If you do it, make sure you read about it and understand all the steps involved. Also, I believe the realtor percentage is negotiable.
We sold our house and purchased a house FSBO. It was so easy and we saved thousands of dollars.
We made an informatin sheet and put it out in front of the house with a sign, just like the agents do. I was quite capable of telling potential buyers that "this is the dining room", "the furnace is 10 years old", etc. Anyone who gave us a lowball offer was shown the door. It's okay to say no, or counter offer.
We ended up selling the house for $3K less than the asking price, and we were asking $45K more than we paid for it. I think that's pretty good, and with no agent to pay, we got to keep it all.
Do your research, check property tax websites and see what the value of the houses around you are. Go visit any open houses to see what the competition is and price your house accordingly. We knew we could get more for our house based on the improvements we have made, plus we were in a highly desirable area for starter homes.
When buying our new house, we specifically sought out FSBO houses. We made them a very fair, non-insulting offer and they counter offered. We took it. We all met at the Title Company for the closing and had lunch together afterwards. No agent was needed for this at all.
The key ingredient in our sale/purchase was the Title Company. They had everything ready for us, explained the financing, legalities, etc.
Good luck. It's a lot of work, but stay organized (get a notebook and keep the inspection, samples of utilities costs, details of upgrades, etc. and lots of file folders!) and do your homework and you will be successful!
Are prices going up in your area? If so great, but if prices are still dropping a realtor might be well worth the expense.
We are unintentionally selling our house FSBO. We were telling everyone we wanted to sell and some neighbors who are renting made us an offer. They need time to repair their credit, so we have decided to wait for them so we don't have to pay Realtor fees. We will be using an attorney for the sale.
Facebook is another advertising venue. We actually showed our house to two people who heard about it from friends that saw it on FB. Our neighbor is selling her house and she also posted on facebook and has gotten a little foot traffic from the deal.
I agree, research everything you can. A dear friend sold their house and bought a new one by themselves. He said the nightmare part was dealing with people that were uneducated on the process. They also had to deal with two people who were trying to scam them, thinking they were uneducated on the process. He said that was the nightmare scenario for them. GL!
We sold our condo "by owner" years ago. We put a sign in the window, an add in a couple of papers and made photo flyers to post around town and at both of our offices. There is very little "paperwork" involved that can't be done by your attorney- you will need one at closing anyway! Our attorney had a "real estate" fee that had all of the paperwork bundled into it. He gave us blank templates to use for writing/accepting an offer and walked us through the whole process. It was pretty painless. Make sure you have a complete list of the documents you will need to sell the house b/c it can take a while to get copies from the city or county if you need them.
I have had friends put listings on their FB accounts recently!
**You can negotiate realtor's fees and they realtor will try to convince you that other realtors won't show a house at 2.5%, but that's simply not true. The way the market is now... they will show houses if 2% if that is what is offered!**
Haven't read the other answers, but we are in the GR area and when we sold, we kinda did a FSBO. We paid a realtor $500, they put the house on the web with a MLS #, so the house was advertised to everyone on the internet. We did all the openhouses, which weren't many and showed the house when someone wanted to see it and did all the advertising. When someone wanted to make an offer on the house, they contacted the realtor and he did all the legal paperwork to make sure nothing was illegal and we didn't make any mistakes. Best $500 I ever spent!
We were going to do an FSBO years ago but never went through after the first buyer could not finance and the second tried to really low ball us. After talking to a realtor, we really could have screwed ourselves. Make sure you have the disclosure form. It indicates the chance for lead paint--any home built before 1970-something (sorry cannot think of the year), any flooding you know about, any issues at all that may have come up. If something happens later and you did not tell them about it on this form, you can be sued. Like suggested already, have a home inspection and appraisal done so there are no surprises.
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I bought my house straight from a seller. They had a friend that was a realtor and agreed to do the paperwork for 4%.
If you decide to list with realtor, I would try to negotiate a lower commission rate. Realtors are hungry for business right now since the market is so horrible, they might be willing to negotiate a smaller commission percentage.
We sold our house last year and got a much lower rate than you were quoted. I asked one realtor we interviewed for a lower rate, and the other two offered it up front. No harm in asking!
Although, I have to say, if we were to sell in a better real estate market, I would try FSBO. Good luck!
My husband and I sold ours for sale by owner. A great site to advertise on is Zillow.com (free). It no realtor is involved then you will need a lawyer with the paperwork. Not too expensive- I think we paid around $200-$500. FYI, at least in MD where we sold our house their realtor could do some of the paperwork but others had to be done on our end (separate representation due to buyer seller interest).
We did open houses with little traffic until our last onewhere we invited friends and neighbors over for a BBQ (we did tell them it was an open house as well). It made people stop in to see what all the fuss was about (we had at least 6 cars outside the house at all times due to the party). Our guests assisted by making a fuss over the home improvements we had made. Great sports! Of course we also offered anyone who came in food too. Made them feel at home. Good luck!
My advice is just have a lawyer so that he can do all the paperwork for you. There are companies that will list you on MLS for a fee. You can do it yourself. Just make sure you are covered. It's amazing all the laws and the things folks can get away with.
