Author Topic: Sell Your Own House (FSBO)  (Read 6774 times)

drewstees

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Sell Your Own House (FSBO)
« on: March 01, 2012, 08:45:15 AM »
Has anyone gone the "For Sale By Owner" route for their house?

We're preparing to move to a more Mustachian environment within 2-3 years, but we're willing to sell our house early if we can manage a decent selling price.  Since there's no rush to sell, I figured I'd look at FSBO.  Our house is a very one-off design, in a rural suburban area, so I figure the unique aspects of the house will help it stand out a bit on its own.  I'm concerned, though, that the FSBO "tag" will carry a negative connotation of sorts to potential buyers.

Have any tips or insight into FSBO?


arebelspy

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Re: Sell Your Own House (FSBO)
« Reply #1 on: March 01, 2012, 08:52:32 AM »
I haven't done it personally, however one thing I will add as a real estate investor, if you're willing to carry the note on it ("owner carry"), you can likely get a much better deal than today's prices.
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Mrs MM

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Re: Sell Your Own House (FSBO)
« Reply #2 on: March 01, 2012, 10:36:05 AM »
If you do a for sale by owner, just make sure your house appears in the MLS otherwise serious buyers won't find you.  I would also put it on craigslist.

There are services like zip realty, forsalebyowner.com, and "help you sell" that might put it in the MLS for you and they are much less expensive than a traditional realtor.

Personally (being a Realtor), I think anyone can sell their own home if they price the house right from the beginning (don't start high and then drop the price, if you can avoid it), if the house looks great inside (clean, no clutter, well staged), and if it shows up in the MLS so that buyers see it.  You may want to state that you will pay the buyer agent fee, so that agents don't discriminate against your home just because there is no listing agent.

You will also want to know how the paperwork and the whole buying/selling process works.  If you're working with another agent, they will likely help you out (but beware, as they will not have your best interest in mind).  If you get a buyer that is NOT affiliated with an agent, then you'll need to make sure you really know what you're doing.

Good luck!!

Midwest

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Re: Sell Your Own House (FSBO)
« Reply #3 on: March 01, 2012, 11:11:06 AM »
We have sold 2 houses FSBO.  Last one was in 2005.  We did not list on the MLS, but I would strongly consider it today because of the exposure it provides.

A few tips from my experience:

1. Before you list, do some research on contracts and disclosure and make sure you feel comfortable with those aspects.  I purchased some sample contracts and disclosures.  The state attorney generals website was also helpful.

2. Research comps and price the house accordingly.  We wanted a quick sale on the last one so we priced slightly below market.  Our assumption was that we could pay a buyer agent and still come out ahead with our pricing.  We actually got lucky and sold to a buyer who was not represented by an agent.

3. Add the phrase (or something similar) - buyer agents welcome.  Agents won't show your house to buyers unless they are getting paid.

4. Be prepared to spend money on advertising.

Selling without an agent isn't for everyone.  Agents provide a valuable service.  You'll need to weigh your time commitment/comfort level against the potential cost savings.

Midwest

drewstees

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Re: Sell Your Own House (FSBO)
« Reply #4 on: March 02, 2012, 06:38:40 AM »
Thanks for the various bits of feedback...all helpful.  I've got plenty of time to research and prepare, so we'll see how it goes, and at the least I'll come away with some more knowledge to add to the toolkit.

And thanks again to Mrs. MM for setting this forum up!

velocistar237

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Re: Sell Your Own House (FSBO)
« Reply #5 on: March 02, 2012, 09:02:13 AM »
As a hobby photographer, I've taken a few real estate photos for friends. One photo blog I frequent had a good post on how to stand out from the crowd:

http://strobist.blogspot.com/2009/04/use-free-blog-to-sell-your-house.html

It's more about marketing than about photos.

drewstees

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Re: Sell Your Own House (FSBO)
« Reply #6 on: March 02, 2012, 11:22:10 AM »
As a hobby photographer, I've taken a few real estate photos for friends. One photo blog I frequent had a good post on how to stand out from the crowd:

http://strobist.blogspot.com/2009/04/use-free-blog-to-sell-your-house.html

It's more about marketing than about photos.

Wow, I really like that blog idea...clean and simple.  I'll definitely use that as a template.  Thanks!

Mrs MM

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Re: Sell Your Own House (FSBO)
« Reply #7 on: March 05, 2012, 11:28:57 AM »
As a hobby photographer, I've taken a few real estate photos for friends. One photo blog I frequent had a good post on how to stand out from the crowd:

http://strobist.blogspot.com/2009/04/use-free-blog-to-sell-your-house.html

It's more about marketing than about photos.

Great advice.  When we sold our home, we got an offer in 1 day.  I think the web page we set up (with tons of pictures of every single room) pretty much sold the house before the buyers even got there.  There was still a lot of negotiation and annoyances after that, but it's nice for people to feel like they love the house before they even walk in the door.

Daley

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Re: Sell Your Own House (FSBO)
« Reply #8 on: March 05, 2012, 12:25:55 PM »
I can't say as I've ever done a FSBO on a property, but I have done an auction. Granted, timing is everything and I'm not sure how well the experiences would have translated post real-estate pop (we sold Summer of '07, closed escrow and signed paperwork on August 17th - day the panic reached a crescendo and finally popped - buyer's mortgage wasn't approved until *that* morning), but it was still enough of a positive experience that I'd be tempted to do it again if the opportunity arose.

Now, what were the benefits we encountered with auctioning? First off, we only had a 3% commission taken off the top by the auction company instead of the traditional 6% by the real estate agents. The agents we'd had walk through and assess selling value were figuring we'd only get around $160-165k on the regular market selling traditionally, but we decided on a lark to try auctioning instead. As such, since we were permitted to set a minimum value for the property to auction at, we set the low end of the appraised selling value. We also had the option of stipulating escrow terms in the winning bid contract of 30 days, and the winning bidder had to lay down a non-refundable if escrow terms were broken 10% deposit, with 70% of that going to us if it was. The auction was an intense and nerve-wracking 15 minutes after a 90 minute open house, but when the dust settled? The house sold for $195k. $30,000 more than the traditional agents were figuring the place would sell for. The best part? We only had to clean the house up once for display and knew with relative certainty the date we would move out so long as nothing went sideways, and if it did, we got money to cover that for breach of contract.

Think about it, though. Auctioning is the ultimate form of high-pressure sales. You have a captive buying audience already serious about purchase with money in hand, they're on site at the property where it's a tangible purchase immediately after a walkthrough and no time to think things through or sleep on the decision or re-visit the property, no bargaining back and forth opportunity for days with offers and counteroffers, and you have buyers directly competing against one another for ownership.

YMMV of course, others may have had bad experiences, it might be a regional success thing, we may have lucked out with the tail end of the housing bubble, etc. etc., but it's still something worth at least looking into as an option because when it works? Boy howdy does it work!

drewstees

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Re: Sell Your Own House (FSBO)
« Reply #9 on: March 06, 2012, 01:53:13 PM »
I can't say as I've ever done a FSBO on a property, but I have done an auction. [...]

Interesting.  I hadn't even considered that.  I've only been involved with house auctions that result from the death of an owner, but I definitely see your points towards the advantages.  I'll have to look around for some more personal accounts from others who have done that.

YMMV of course, others may have had bad experiences, it might be a regional success thing [...]
Where or what type of region was your auction in?  Was it a common thing in the area?  How did you come up with the idea to go the auction route?


Daley

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Re: Sell Your Own House (FSBO)
« Reply #10 on: March 07, 2012, 10:21:58 AM »
YMMV of course, others may have had bad experiences, it might be a regional success thing [...]
Where or what type of region was your auction in?  Was it a common thing in the area?  How did you come up with the idea to go the auction route?

Middle Tennessee, suburban sprawl. I wouldn't say it was a common thing in the area, but we did see auction signs for real estate posted once every 4-6 months in the area for a couple years prior. We'd decided to give it a try partly because we were made aware through the occasional other auction signs that it was a possibility and when we heard we'd only lose 3% of the sale price versus 6% going traditionally, we were sold. Next thing we knew...

A couple more things to mention that I failed to the first time, though. 1) And this is a good thing, but the sale was also as is, so there was no last minute demands of things being fixed up in order to push through the sale. Saved us a lot of grief. 2) The major downside of auction is if the first buyer somehow falls through or the auction doesn't meet your minimum expected sale price, subsequent auction attempts and traditional market sales will be hurt as the "free market" has officially set a current fair market value to your property, and the odds of getting any better than that first round within the next 12 months or without major renovations is kinda slim. We had been told that if it didn't sell the first time around and it went back up on auction that the bidding usually doesn't exceed the top bid of the first auction, and is frequently lower (10% or more if memory serves). If you're serious about auction, talk with the auction company about the major downsides and negatives if it doesn't sell the first go-around.

Spartan

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Re: Sell Your Own House (FSBO)
« Reply #11 on: March 15, 2012, 10:12:56 PM »
I have sold two homes by owner.  We placed a sign with "take one" flyers that had details and led them to a website so that they could see a lot of pictures of the home in a staged condition.  Another time we gave this a shot and only had a few tire kickers.  Ultimately we listed with a "flat fee" realtor service.  They listed our home on MLS for about $300 and we only had to pay that plus 3% to the realtor on the other side of the transaction.  If you don't have any luck with FSBO after a couple of weeks, I would recommend the flat fee route.  It's a middle of the road approach and may save you thousands of dollars.

adam

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Re: Sell Your Own House (FSBO)
« Reply #12 on: March 16, 2012, 07:01:02 AM »
I never thought about an auction.  I need to do more research into that.  Our contract with our realtor expires in April.  We haven't had one showing or offer.  I don't think we're going to stay with her after this and we really would like to sell instead of rent.

Welmoed

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Re: Sell Your Own House (FSBO)
« Reply #13 on: March 16, 2012, 08:06:36 AM »
Consider getting a pre-listing home inspection before you put your house on the market. Any buyer is going to bring their own inspector in, and having your own inspection done beforehand can alert you to minor (or major) issues that will be called out during the buyer's inspection. Small things like loose toilets, dirty furnaces and stuck windows WILL be called out by an inspector, so you might as well address them beforehand.
Find a good inspector by checking out the American Society of Home Inspectors website (www.ashi.org). Don't rely on referrals from realtors.
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HeidiO

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Re: Sell Your Own House (FSBO)
« Reply #14 on: March 16, 2012, 01:49:39 PM »
I sold a house about 10 years ago.  I used the NOLO book on FSBO and it had the contracts I used - it made it easy.
Heidi