Homes For Sale By Owner – Top 10 Secrets To Selling Your Home On Your Own

Homes For Sale By Owner – Top 10 Secrets To Selling Your Home On Your Own

So, you’ve decided to sell your home yourself! You can save many thousands of dollars if you succeed. I wrote this guide to help you. I have seen many FSBOs have unrealistic expectations and make mistakes along the way that ultimately prevent them from being successful. Did you know that 80% of FSBOs end up listing their home with a realtor? I hope these ideas help you put in the other 20%.

Am I trying to go out of business? No. Do I think everyone has the right to sell their home as they see fit? yes If your circumstances change and you decide you want a professional to sell your home for you, please call Gold Valley Realty. We are a full service brokerage firm with a flexible commission structure that is hard to beat.

Tip 1 * Plan your strategy

First, by when does your home need to sell? Is it good after nine months? Or won’t you be able to close on your new home if your current home doesn’t sell in nine weeks? What are the consequences and financial impacts if your deadline is missed? Time is FSBO’s friend.

As of October 2008, the average marketing time for a median priced home listed by a realtor on the Tucson MLS (Multiple Listing Service) was 78 days. This time varies greatly by location and price range. Ask Gold Valley Realty what the average is for your neighborhood. As a general rule of thumb, it usually takes a FSBO about twice as long to sell a home as a realtor with MLS access. In both cases, add to this the normal 30-day period from the negotiation and acceptance of the contract to the final closing of the transaction.

The name of the game when selling a home is to get as many qualified buyers through the door as possible. Who is a qualified buyer? A person who can afford your home! A person who can be verified has either the cash or the financing to buy your home. Realtors quickly learn to qualify their buyers before spending much time working for them. You should too.

Speaking of brokers, will you “collaborate” with them? That is, if they bring in the buyer who ends up buying your home, are you willing to pay them? If so, how much? The majority of homes listed on the MLS offer compensation of three percent of the sale price to the buyer’s agent. In my experience, about 90% of FSBOs offer compensation to buyer’s agents.

How do you plan to get qualified buyers through YOUR front door? The various methods are discussed in detail below.

What is your marketing budget? When and what will you spend it on?

Who will negotiate and draft the contract for the sale of your home? Who will monitor escrow to quickly identify and resolve any potential deal breakers?

Tip 2 * Price your home right.

This obvious step will have the biggest impact on the success or failure of your temporary FSBO (For Sale By Owner) career. Yet for most FSBOs, it can also be one of the most challenging actions.

The market value of your home is what a ready, willing and able buyer is willing to pay you for it.

How much a buyer is willing to pay for your home depends on their personal circumstances and motivation; competing properties available in your area; and the prices of recently sold comparable homes in your neighborhood. Information on competing properties and recently sold “computers” is available from several sources. We highly recommend getting a professional appraisal of your home. This will cost you around $300. Having an objective appraisal has several advantages, not the least of which is the ability to provide your buyer with a solidly defensible price determined by an independent expert.

There are situations where it may be more important for you to sell your home quickly than to get every last dollar out of your home. In this case, you may want to appraise your home a few percent below the appraised value. Your best bet, however, if time is a serious consideration for you, is to list your home with a realtor. One of the added benefits of listing with Gold Valley Realty is that we reimburse you for the closing appraisal! Even if you did the evaluation while you were a FSBO.

Tip 3 * Marketing materials

The single most effective marketing tool to date is the yard sign! Make your look professional. Look for a sign company in your city. Buy one of the information tubes that hang under your yard sign and stuff it with flyers.

Your flyer should include at least one color photo and highlight facts about your home, especially asking price, number of bedrooms, square footage, special features and schools.

Ask if you can post your flyers at nearby grocery stores, churches, schools, apartments, health clubs, country clubs, golf courses, travel agencies, insurance agencies, beauty salons, title companies, mortgage companies! Give some to your friends and neighbors too.

Post your home information on the world wide web. An increasing number of home buyers are using the Internet as a valuable source of information.

Newspaper ads can be somewhat useful, even more so if used in conjunction with open days.

Tip 4 * Get your home in order for showing

As the old saying goes, you only get one chance to make a first impression! Make sure it’s good. Make sure your front yard looks good. Is your front door handle showing its age? Replace it. Make sure your home is clean and tidy. Open all curtains, blinds and shades. Turn on every light in the house, day or night. A sparsely furnished room looks better than a messy room. If you’ve accumulated a lot of extra stuff over the years, put it in storage! You’ll be moving soon anyway. Does your home pass the sniff test? If you have pets or are a smoker, this may not be the case. In that case, either replace or have your carpets professionally deodorized. If you have an open day, bake some bread or cookies to make your home smell great.

Tip 5 * Security and display of your home

You can show your home either by appointment or by holding an open house. Making appointments can be difficult if you’re not usually available to answer the phone number on your ads and flyers. You might consider using voicemail or a live answering service (starting at about $35 per month) to send your sales calls instead of using your home phone. This also offers some security benefits.

It is unlikely, though unfortunately not impossible, that criminals will use this opportunity to steal your belongings or harm your family. A little preparation can go a long way in minimizing this possibility.

Consider renting a safe deposit box to store your valuable jewelry, coins, weapons, stamps, and memorabilia. Make a list and videotape the contents of your home and keep it in your safe or at work. You should also hide cash and prescription drugs in an inconspicuous place before showing your home.

Have your spouse, friend, or neighbor with you when you show your home. If the “buyer” makes you nervous or suspicious, ask them to leave.

Tip 6 * Cooperate with buyer’s agents

Virtually all homes listed for sale on the Tucson Multiple Listing Service (MLS) have a standing cooperative offer for a three percent (3.0%) or more commission to the agent who ultimately hires the buyer. You may want to make the same offer to any broker who contacts you. Why?

Most home buyers are either already working with a real estate agent or soon after starting their home search. Why? They can get professional representation for FREE because the buyer’s agent’s commission is paid by the seller of the home. This means that the buyer can have an agent inspect homes for them, make appointments, accompany them to appointments, advise them on the home’s market value, write the offer, negotiate with the seller (or the seller’s agent), set up escrow, be there for inspections, handle any issues that arise, coordinate with the other businesses involved (mortgage company, home inspectors, escrow, title insurance), review final contract compliance documents and be there at closing, all of it FREE. So why would a buyer buy a home without a realtor working for them?

Tip 7 * Pre-qualify potential buyers

A buyer’s failure to qualify for a loan is the single most common reason a FSBO deal falls apart.

Brokers get their buyers pre-qualified with a lender before spending a lot of time and effort on their behalf. I personally will meet with a buyer for an initial consultation whether they are pre-qualified or not, but I won’t go beyond that until I know they can either get financing or pay cash. I definitely recommend not entering into a contract with a buyer until you have independent confirmation of their ability to obtain financing or pay cash. Ask for the name and phone number of their loan officer. Call the loan officer and explain the situation; ask him or her if the buyers can qualify for a mortgage sufficient to buy your home.

Tip 8 * Use professional contracts

The contract, which is used by brokers across the country, has evolved over time to cover almost all contingencies and disputes that have arisen in the past. I highly recommend that you use this contract and not a generic do-it-yourself real estate contract. Arizona has unique laws and customs regarding the sale of real estate. A contract that is useful in another state will not be optimized for use in Arizona. If you’ve found a buyer and want to write a contract, contact a local real estate agent and see if you can get a copy of a blank contract.

Tip 9 * Monitor escrow closely

You’re almost there! You’ve found a buyer, negotiated and signed a contract, and opened escrow with a reputable title company. There is actually a lot more to do before you sign the deed at the title company and get your money.

The buyer is generally entitled to carry out any inspections he wishes within the first 10 days after acceptance of the contract. If he finds problems with the house, roof, appliances, heating, cooling, plumbing, etc., he can either void the contract or require you to repair or replace the defects. This can be an unpleasant situation. You as the seller may feel that the buyer is asking for too much. This is something that can be negotiated, but should be done diplomatically. Try to keep your pride and emotions from interfering with your ultimate goal of selling the house.

Get a written conditional loan approval (CLA) from the mortgage company within the first 10 days of accepting the contract. This is much stronger than a verbal “pre-qualification” and means your deal is more likely to close. Contact the mortgage company about 5 business days before your scheduled closing; make sure their documents will be available to the escrow company at least one day before you sign the closing documents.

Tip 10 * Close Escrow

A final note about closing. The closing of a home sale in Arizona is defined as the documents being recorded with the County Clerk. After the buyer and seller sign, the loan package must be returned to the mortgage company for a final inspection. The mortgage company will then actually transfer funds to the escrow company. Only then can the escrow company send a runner to the County Clerk and record the sale. The bottom line is to sign the papers the day before the actual closing.


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