Taking an FSBO (For Sale By Owner) approach to selling your home can be tempting, considering that you will be saving thousands of dollars in agent fees and commissions. While taking this route can certainly save you money, FSBO is far more demanding and complex than most homeowners realize.
However, this does not mean that you cannot sell your house by yourself - all you need to do is look out for a few mistakes and make sure to avoid them. Fortunately for you, we have compiled some of the most common errors that FSBO owners make so that you can get a better understanding about how to sell your house by owner.
Error 1 - Using an inferior FSBO sign:
It might sound like a good idea to buy a flimsy ‘for sale by owner' sign and plant it in your front yard. However, doing so can significantly lower your chances of attracting serious buyers or good prices. You should seek out professional services for the yard sign designing and preparation; this way, you will be ensuring that the sign is striking and sturdy.
Error 2 - Overvaluing your house:
Your house likely has sentimental value for you - as it should. However, fondness puts you at a disadvantage when you are trying to sell your house, as you end up putting a higher-than-normal price on the property. Remember that the supply and demand factors will ultimately determine the price you get for your house, and that interested buyers need to see the full value of their potential purchase. When setting a price, understand that there is high competition, and setting an unusually high price will just deter potential buyers.
Error 3 - Undervaluing your house:
The other side of setting an unrealistically high price is a price that is too low. Some owners believe that setting a price on the lower side will attract hordes of buyers and result in a swift sale. However, remember that once you lowball your residence, get an offer, and sign a contract, there is no turning back - even if you later discover that you could have easily gotten an additional $40,000.
Error 4 - Ignoring housekeeping:
Agents help houseowners sell their houses in the best possible condition and appearance, and even bring in a staging professional who can help you arrange your interior in a way that modern buyers find attractive. Many FSBO owners underestimate the importance of a tidy house. A lack of curb appeal, for instance, will compel potential buyers to drive right past your house and not give it a second glance. Inside the house, you might have become accustomed to the clutter and the smudged windows, but to a house-hunter, such conditions can prove to be a real turnoff.
Error 5 - Slow response time:
With online house selling, buyers can easily contact multiple houseowners at a time. So, if you delay responding to a potential buyer by even a few days, that lapse might be enough for them to sign a contract with another party. It is crucial that you provide a timely response to every call and email. One way to ensure that is to set a special ringtone for a potential buyer that you are in contact with, or turn on the email notifications on your phone.
Error 6 - Poor negotiation:
A potential buyer is likely to open negotiations with a lowball offer, hence, you should be confident enough to counter with a higher price. Also, price is not the only thing that is negotiable. Factors such as earnest money (the amount that the buyer hands over when making an offer), the closing date (the day on which the deal is finalized and the keys are handed over to the new owner), and things like if the furniture will remain in the house, can all be negotiated. So, without topnotch negotiation skills, you might end up losing out to savvy buyers.
Error 7 - Not disclosing defects:
The Seller's Disclosure is a document that outlines and explains any problems or issues with the house. Not providing this crucial information might end up jeopardizing the contract and even leave you open to a lawsuit. Common disclosure form can be taken from a banker or even downloaded online.
Error 8 - Exaggerating:
When listing your house online or in a newspaper, it is vital to be painstakingly factual. Claiming that your house has a space of 2,500 square feet - while in reality, the space is only 2,300 square feet - can, once again, threaten the entire deal and make you the target of a misrepresentation lawsuit. If you are looking to go FSBO, we recommend hiring a certified appraiser for your house and going with the figures provided by the appraiser.
Error 9 - Not researching the buyer:
To successfully conduct an FSBO sale, you need to think like an agent. This means researching a prospective buyer's income, credit rating, and budget. Additionally, you also need to ensure that the buyer has been preapproved by their lender. Without such meticulous research, you might end up giving a house tour to someone who cannot get their mortgage approved.
Error 10 - Posting subpar photos:
If your photography skills are below average, it is highly recommended that you hire a professional photographer to click your house pictures that you will be posting online. Remember that visuals are the first thing that catches a buyer's eye, and unprofessional pictures will just make them scroll down and turn their attention to more tempting pictures.
Error 11 -Saying more than is needed:
Smart buyers are always watching out for ways they can gain the upper hand in negotiations. So, for example, if you tell a potential buyer that you are in a rush to sell this house or that you have been unsuccessfully trying to sell this house for several months, you are setting yourself up to receive a lowball offer. If a buyer asks you why you are selling this house, give them an answer that goes like, "We love this house and we are going to miss it terribly, but we decided that it is time for a bit of change."
To conclude, it might be challenging to pull off an FSBO sale, but there is no reason that you should not be able to do it. We hope that this guide will prove to be a valuable resource in helping you avoid the various slippery slopes associated with FSBO selling. How To Sell Your House By Owner