FSBO guide: 5 reasons you should sell your house yourself
When it comes time to sell your house, the thought of saving thousands on commission is very tempting – maybe a For Sale By Owner is something you have considered. We do know that it is possible to sell real estate without a licensed agent helping navigate the transaction- National Association of Realtors reports that 8% of all sales were homeowner assisted in 2015, so it is being done. Let’s dive into the details and see if FSBO is the right route for you!
1) You have access to current and past sales statistics. In today’s information age, it has becoming easier to obtain an abundance of knowledge at our fingertips. In real estate, this is a biggie, price point is everything. With sales averaging 98% of list, the old “Price it high and wait for an offer” thinking just doesn’t work. Buyers are looking at houses they can afford and if you put a commuter car in the same line up as a luxury vehicle, it just won’t sell. Agents are on the pulse of the market – with details on final closing prices, subsidies, and days on market as well as listings that will be coming soon and the temperature of buyer interest.
2) You are able to prepare your home for sale. Sounds easy enough – step one is to do a thorough cleaning – akin to getting a car detailed. But what to do after that? Perhaps you are in the staging and decorating world and know how to turn your family room into a photo spread for HGTV, this would help tremendously! Prepping a property for market is more than just one pretty room though – staging is NOT decorating. The goal is to create a homey, well cared for, neat, clean, and inviting atmosphere that ALL buyers could envision themselves living in – it has to not be taste specific without appearing sterile. Deferred maintenance is a big one too – sometimes as homeowners we live with a door that won’t lock or a sink we can’t use for so long we don’t even notice it anymore – unfortunately the buyers will. They will see it all – the dated brass chandelier covered in dust way up high in your foyer, the trim around the back door that the dog has worn away asking to get in, the odors from your favorite dinners – things that don’t hit your radar. Perhaps you will hire a stager and inspector to help you before hitting the market? That would be a smart solution if this isn’t your strong suit.
3) You are able to market your property effectively. This one is a little tougher. Where do buyer’s come from? Well 85% come from the internet or a real estate agent. And just how did the homes get on the internet? 92% of them were through an agent. Seems like the market is cornered – there are options though! You can reach this pool of buyers by paying a flat fee to put your home on the Multiple Listing Service – problem solved! Oh, wait, doing this cut into your profit some, as you will have to offer a commission in MLS to the buyer’s agent. On a $500,000 house, this tends to average between 2 and 3% – sometimes more, sometimes less. How to know what to offer? Then there are pictures, floor plans, surveys, disclosures required by law, timing, verbiage (did you know that listings which mention “light filled” sell for more on average??), and a myriad of other details in order to present your home as attractive and attainable to its future new owners.
4) You are comfortable with legal documents. Buying and selling a home is likely one of the biggest financial transactions of your life. There are reams of paper involved in each transaction, with disclosures, timelines, and inspections that all vary by property type, state, and community. How to know what you are legally required to disclose? What are you contractually obligated to do? What happens when timelines are missed? Which contract should you use? Will you hire an attorney to go over the documents? That will eat up more of those savings.
5) You have free time to devote during the sales process. The typical home is on the market for about a month, add to that the prep time before hand as well as the contract to close time during escrow, and this project will likely take you about 3-4 months. The tasks required vary throughout the transaction from keeping your house show ready, to hosting open houses, to allowing buyers access to preview, coordinating with other professionals (appraisers, inspectors, buyer agents, surveyors, etc), keeping marketing fresh and current, perusing legal documents, managing repairs, and more. It will likely eat up all of your free time and quite a bit of your vacation days from work too. If you have abundant down time, it is quite possible for you to manage a sale. What happens if it falls through and you start over, minus those vacations days?
What does this all boil down to? An average of 11% less for the sale of your house to save somewhere around 4% on fees. Now these are all averages, and each person’s situation is unique. I can tell you there are somethings I personally attempt to do in order to save some money. In different stages of my life I have tackled projects myself instead of hiring professionals – from the simple, lawn mowing to the complex, starting an LLC. Is one better than the other? It depends. On so many factors that a one page blog post couldn’t possibly answer. What I do know is that Real Estate Agents have the vendors, resources, and experience to walk you through the home sale process, ultimately saving you time and money on the road to settlement. I also know that the last time I did my own real estate sale (after decades of experience), I decided that next time I was going to hire an agent. Yep. In the end, even with my background and resources, I found the entire thing way too emotionally draining for me to remain objective and treat it objectively, even though I knew better.
If you are looking at your options to see what is best for you when it comes to selling your home please feel free to give us a call and we can walk you through the process. Call Ask Gina & Company at 703-574-3478 to let Team AGC help you with the decision process. After all, knowledge is power.