For Sale By Owner - who's BTDT?

[1bassoon]

Any advice? Pitfalls? Positives? Negatives?

 

The whole thing scares the pants off of me (not a pretty sight :p), but financially we may need to try it.

 

So, hive - what say ye?

[jail warden]

we tried to sell our house. It didn't work out we had it priced too high. Then the following summer, we used a realtor we knew. Went great, we sold it the first person that walked through, but it made us wonder if she priced the house too low.:confused: That's our only experience.

 

I don't know if you like Dave Ramsey at all, but he recommends that you get a realtor because you often get more for the house and have more exposure to people. He also has ELPs he reccomends. I've never done this, but thought it might be a good idea to try.

[elegantlion]

We sold our first house that way. Sold in 21 days for good price. We did a lot of research with our local FSBO office. They helped us walk through all the required paperwork. We closed at an attorney's office. It was the least painful home sale we've made.

 

My dh has been in sales and was not afraid to enter a tough negotiation period. We were actually at a baseball game when we finalized the negotiation.

 

I staged the house, and we were in a well established neighborhood which we were confident would sell quickly.

 

That being said, we are going to be sellling our current home this year and we will list with a realtor. We are new to the state and unsure of all the laws and since we will be moving out of state we want to make sure we don't leave anything openended.

 

I'd suggest you find a reputable FSBO office and ask lots of questions. Do your or your dh feel confident entering into a face to face negotiation of your home? Are you willing to listen to people speak honestly about your homes faults? Are you willing to stay on top of the processing of paperwork, which could mean countless calls to title companies, appraisers, etc? Is your area FSBO friendly or will other agents not show your home?

 

HTH

[Tutor]

Have you looked into something like "Help U Sell"? They help you list it online, provide signs, get a listing in the paper, assist at closing, connect you to assessors and inspectors, etc, but they charge a flat fee of about $500. You still do a lot of the work... write up the ads, host the open houses, file paperwork, etc, but they help guide you.

 

I haven't tried it, but always thought it was worth looking into.

[Sandra in NC]

Our first house sold by word of mouth when we were "just thinking about" selling it.

 

We decided to sell our second home FSBO. We had a contract within a month BUT THEN one week before closing the buyers backed out and we had to start all over again. We could have sued for specific performance, but we didn't want to waste time and money. It took another month to find a buyer and 45 days to close. We advertised in For Sale By Owner magazine and the local paper.

 

Our third home was in a new subdivision with new construction all around. It was a tough sell. We tried to sell it ourselves for 2 months, then contracted with a realtor who put it in the MLS for us for $500. It sold in a month.

 

From what I've seen in our neighborhood, realtors are not diligent about marketing homes. They rely on the internet and MLS to do that. Often, the info boxes at the street are empty and rarely are there Open Houses. So, I think selling it yourself WITH the MLS listing through a realtor who is willing to do that for a flat fee is the easiest route. If I did decide to use a realtor, I'd find one who is new -- eager and motivated to build a business. (I'd get a comparative analysis from 3 old timers familiar with my neighborhood to check the pricing the new realtor comes up with).

[Quiver0f10]

I really think a lot of it depends on your area. In this market, unless you live in an area that gets alot of traffic/advertising, your house could sit for a while. When we sold in Maine we thought of FSBO, but we needed to move our house fast ( and as it was it took over a year) and we decided to go with a realtor. This is just my humble opinion :D

[Amy in NH]

We did a FSBO in a desirable neighborhood in FL about 7 years ago when the market was just heating up. We were in a financial disaster due to the failure of DH's business, and really had to sell. The house was in pretty good shape, but the yard needed a bunch of work. We priced it to sell, but still giving us enough of a profit to pay off the mortgage and a few other creditors. That meant that we sold it for what was probably quite a bit under market value, but we wanted it to go quickly. We stuck a sign in the front yard and had 3 competing offers within about 3 days. We used a RE attorney to go over the paperwork, which was really just a standard contract we got ?? (I used to work in a RE office typing these things before computers printed them, so I knew what I was looking at). The only tense part was the negotiation with the three interested buyers. The rest of the transaction went smoothly, and I'm quite sure we closed in less than 45 days.

 

I like the advice about paying a flat fee to list on the MLS. We spent a lot of time browsing the MLS from home when we were looking to buy a house last year. We did look in the local newspaper, but the MLS was/is a much more valuable tool.

[Kari C in SC]

We sold our first house FSBO and it went great. I have no idea how the market was at that time. This past year we tried to sell our house FSBO. I also paid $250 to have it listed on the MLS and on Realtor.com. We offered buyer's agents 3% at first and then upped it to 4%. We were still saving 2% on a typical realtor. I got a good many showings, mostly with realtors. We did start out with our price too high. After 6 months of no sale, I thought I must have been doing something wrong. We hired Assist To Sell. You know what? My showings went WAY DOWN! I really found the whole realtor thing to be useless - at least with our realtor. Her plan was to stick it on the MLS and Realtor.com with NO PHOTOS. Then wait. That didn't work. We ended up renting our house and will put it up for sale again in a year. My advice is if you do go FSBO, then see if you can put it on the MLS and offer a decent buyer's agent commission. This market is just bad, bad, bad for selling houses. I wish you the best of luck and pray you get a quick sale.

[8filltheheart]

Couple of thoughts.....

 

Unless your house stands out as unique in some perspective, I wouldn't do it today's market. The house we sold in Jan we bought from a FSBO. We bought it the 2nd weekend he had it in the paper and we sold it in under a week.

 

Secondly, if you do go that route, I would have the home appraised by a locally well known and respected appraiser. Have the appraisal available for perspective buyers. When we have looked at FSBOs, we automatically lower our offer by at least 6% b/c we know they aren't paying commission. With a good appraisal, you will probably receive better offers (definitely ones that exceed the $350 it will cost for the appraisal)

 

Thirdly, my biggest fear about FSBO is letting unknown people in my home. I would only allow showings after writing down the tag numbers on their car. I am paranoid!!

[StaceyinLA]

my sister sold 3 by owner, another sister sold hers by owner, and I think my brother sold at least 2 of his by owner, maybe all 4. I'm not sure about my other 2 siblings.

 

I think it's the way to go. Be sure and check the market, call a title company (they should have copies of FSBO purchase agreements that they can give you), get your house appraised in advance if you like so you'll have that to show those who look at it.

 

Our house sold within a week. My Mom's with the first showing. I do think we had hers priced a tad low, but it needed updating BADLY!!

 

The nice thing is, if you DON'T use a realtor, you have a LOT more flexibility with your pricing and I, personally, believe that is a big plus when selling. You can negotiate more because you don't have thousands in fees to pay. Or, you can be more firm in your price but offer to pay more closing costs (comes out of the proceeds anyway so you never actually have to pay anything out of pocket).

 

All in all, we (any everyone we know who has gone this route) have been very successful with this, and would hesitate to ever use a realtor unless it was absolutely necessary.

[StaceyinLA]

plan to show only when DH is home! This should eliminate any difficulties, and just make you feel more secure in general.

[Janna]

I agree with Quiver. I think it totally depends on your area (market) as well as your specific location.

 

We sold our last house FSBO. It sold in 12 days and we made $45,000 on it (which, for our area and the improvements we made over the only 2 years we owned it, was phenomenal). I do believe there is no way we would have walked away with that much had a Realtor been involved (commission and all).

 

However, our house was on a side street just off a major road. And we were only 2 houses in on that side street, so you could see our house from the major road. Excellent location was a necessity. Had we been tucked away in a neighborhood off the beaten path, I still think it would have sold FSBO, but it would have taken longer.

 

Does your market support a strong FSBO following? Our area did. In fact, one particular FSBO company (designed to take photos for you and house your selling info and photos on their website for a nominal fee) was a major competitor for the top Realty company in the area. We didn't even use the FSBO service because they had already established such a reliable FSBO market that people were comfortable seeing a FSBO sign, and again, we were off of a busy street (had we been tucked away more, we probably would have used the FSBO company just for their website).

 

However, I am in agreement with others that the housing market is so slow and volatile right now, that Realtors are having a hard time, let alone FSBO people. So it's kind of a tricky time.

 

Assess your area. Do your research. Do you know anyone who is a Realtor that would be able to give you some advice or maybe even suggest a starting selling price off the cuff, as a friend? DO you need to sell quickly?

 

Best wishes!

[Janna]

Thirdly, my biggest fear about FSBO is letting unknown people in my home. I would only allow showings after writing down the tag numbers on their car. I am paranoid!!

 

That's a good idea! I remember that being a fear of mine also. Thankfully, not too many people came in - we got more calls than people actually coming in. I didn't think about writing down the license plate number though. I definitely made sure dh was home at the time though. I think only twice did someone come to the door and ask to see it and I requested they come back later that day when I knew dh would be there. The rest of the people called to make appointments.

[Christy B]

Our first house sold by word of mouth when we were "just thinking about" selling it.

 

We decided to sell our second home FSBO. We had a contract within a month BUT THEN one week before closing the buyers backed out and we had to start all over again. We could have sued for specific performance, but we didn't want to waste time and money. It took another month to find a buyer and 45 days to close. We advertised in For Sale By Owner magazine and the local paper.

 

Our third home was in a new subdivision with new construction all around. It was a tough sell. We tried to sell it ourselves for 2 months, then contracted with a realtor who put it in the MLS for us for $500. It sold in a month.

 

From what I've seen in our neighborhood, realtors are not diligent about marketing homes. They rely on the internet and MLS to do that. Often, the info boxes at the street are empty and rarely are there Open Houses. So, I think selling it yourself WITH the MLS listing through a realtor who is willing to do that for a flat fee is the easiest route. If I did decide to use a realtor, I'd find one who is new -- eager and motivated to build a business. (I'd get a comparative analysis from 3 old timers familiar with my neighborhood to check the pricing the new realtor comes up with).

 

We are also in NC; we did one house FSBO -- sold it in less than 60 days for roughly $15,000 MORE than what the realtor suggested we LIST it for. Everything went off without a hitch. The second time we tried it, we got within two weeks of closing, and an unscrupulous inspector falsified all sorts of stuff and the buyers backed out. If we had listed with a realtor that time 1) the realtor would NEVER have let the inspector through the door (turns out she had quite the rep as a "deal-breaker") and 2) we would have at the very least been able to keep the good faith deposit. (Turned out we took the house off the market and are very, very glad we did, so clearly that was God protecting us from our own bad decision to sell.)

 

I would do FSBO again. The only thing I would do differently is have a home inspection done before we listed it -- to catch and correct any potential problems before they become an issue, AND to prevent an inspector from taking advantage.

 

There was a great package that we used when we did our FSBO -- I don't remember the exact info, but google "audrey book for sale by owner" and I bet you'll find it.

 

Oh, and I totally agree with the comments on paying the fee to have your house listed in the MLS. Well worth it.

 

Aside from that, check out some books on home staging, print up some really attractive flyers, declutter ruthlessly, scrub the house spotless, and above all make sure the place smells good.

 

Best wishes to you!

[sassenach]

This depends GREATLY on your area. The market is so tricky right now. We just sold our home in Florida with a realtor. It would not have sold by owner. There is just way too many homes on the market. I think you should really interview some realtors and get a feel for your market before making that decision. Even if you are in a healthy market, the mortgage situation is making things very tricky right now. With our sale, I am absolutely convinced that we would not have been able to handle selling it on our own. That's even just with the issues we've had since we got the contract. It has been very stressful and I'm glad we had our realtor there. If you do sell it yourself, remember to give room in your price for at least 3% commission for the buyer's realtor.

 

Edited to add- in tight markets, realtors will not bring their buyer to see FSBOs. Realtors support realtors. Just another thought. Not to be a total downer! The Florida market has thoroughly kicked our butts, so I'm a little weary at the moment. Good luck!

[elegantlion]

Another thing we did was have a visitors log. Anyone who toured the house had to fill out name, address, and phone. We also showed the house with both of us home, never alone.

[lynn]

We purchased our first home fsbo. We did not have any problems. We even assumed their mortgage. It was a lot of paperwork back then but we managed to get it all complete in 30 days.

[K-FL]

Remember the buyer's mortgage co. sets all the time tables & inspections due once you have a contract--so that part's easy. As to the selling part, check w/some Realtors to see if they'll do a 1-2% to handle the MLS & paperwork for you. When I was an agent (17yrs ago) our broker suggested this as a way to get FSBO's to do some type of listing w/the office. As to strangers walking through-in this day of lock boxes, not all listing-agents go on every showing & some on the buyer's side are slack too. If you do list that's something I'd make a point of in the contract.

[Kari C in SC]

The Florida market has thoroughly kicked our butts, so I'm a little weary at the moment. Good luck!

 

Boy, can I relate to that! After 9 months trying to sell our house... I was just plain tired and worn out! I am so glad we just decided to move to our SC house and rent it. I just couldn't deal with the whole real estate market for a moment longer.

[Suzanne in ABQ]

We sold one of our houses FSBO. We had a plan: we'd advertise it FSBO for two weeks, then we'd list it on the MLS (by a realtor who would do it for a flat price -- $250 at the time). If it didn't sell it in another two weeks, we'd list with a realtor. We had been talking to a realtor who did a free market analysis for us. We priced about $4ooo below the market price, about half a realtor's commission. The realtor was supportive of our efforts (I don't think he thought we'd succeed. He was hoping to sign on later)

 

We found a buyer a day before we were going to put it on the MLS. We went through a local FSBO attorney, who did all the paperwork. He would have provided flyers and a sign, but we didn't know that. Everything went through without a hitch. The buyers were happy to get it below the market value. We were happy not to have to pay a realtor.