For Sale By Owner – A Comprehensive Guide to Selling Your Home Without a Realtor

Sell your home by owner

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The information provided below is our experience selling a home without a realtor. Your experience may vary based on market conditions.

My wife and I consider ourselves to be religious people. We feel that God is actively involved in our day-to-day lives. When we each felt the impression independently to sell one of our rental properties, without even speaking to each other first (and on the exact same day, mind you), we knew that divine intervention was involved.

The first thing we asked ourselves was, “Well, do we sell the home ourselves? Or do we use a realtor?” If you couldn’t already tell from other posts on SaneCents, I’m a numbers guy. I grabbed a calculator, punched some numbers, and found that if we sold the home ourselves, we would save 3-4% in agent commissions, netting an additional $7,000.

I don’t know about you, but $7,000 isn’t something I scoff at.

And this was just our situation. In markets with soaring house prices, you could be saving thousands by selling the home yourself. If your home has a list price of $350,000, for example, you could net an additional $21,000 selling without a realtor.

What we really needed to figure out was if saving $7,000 by not hiring a realtor was worth the hassle of doing all the work ourselves. We realized that we would be tasked with getting a market analysis completed, staging the house, photographing it, listing and marketing the home, dealing with realtors, scheduling multiple showings, keeping the house spotless during all the showings, negotiating offers, writing up counter offers, dealing with inspections and bank appraisals, filling out legal documents, working with title companies, and more.

If all this sounds intimidating, it is. If that sounds like too much, then selling your home FSBO (for sale by owner, pronounced: fiz-bo) may not be for you.

But here’s the thing — it’s really not that bad.

If I’ve kept your attention this long, it looks like you’re ready to go the FSBO route. Where do we start?

Fix Up the House

fix up the home

You know that long “honey-do” list that you’ve had for the last six months? Well, now is the time to complete all those tasks as quickly as possible. This, at least to me, was the most stressful part of the entire process. We were anxious to get the house on the market as soon as possible, but we realized that it needed to be in better shape to entice buyers.

This piece normally takes the longest of all the steps. It took us three weeks to really be confident enough with our home’s condition to be ready to list it. We spent almost every evening after work at the rental, and often entire days on the weekends. We replaced dented trim pieces, pulled weeds in the yard, touched up holes with putty and paint, and more.

They key here is to not go overboard fixing every little flaw and imperfection, but to specifically fix the immediate eye-sores that potential buyers will notice during a walk-through.

If you don’t feel that you can accurately gauge what a buyer will or won’t find appealing, ask a friend to come walk through your home as if they were a prospective buyer. Tell them to walk around with a notepad and write down everything they see as a negative. Tell them to be brutally honest. It may be hard to hear their responses, but we’re trying to sell a home, not coddle your feelings.

In most cases, you shouldn’t need to hire any professionals unless the house needs major repairs.

Comparable Market Analysis (CMA)

Once the house is in tip-top shape, you’ll want to acquire a Comparable Market Analysis (CMA). This will tell you what your house is worth based on other houses currently selling in your area. It’s a broad overview of the current housing market where you live, and it shows how your house ranks price-wise with other homes in the area.

All too often, I see FSBO sellers become too emotionally attached to their home and list their house for what they think the house is worth, and not its actual market value. They list their home much too high and then wonder why they get no interest.

Our goal is to sell the home, not have it sit on the market for weeks. The longer it sits on the market, the more money you lose in additional mortgage and utility payments.

Prospective home buyers will also begin avoiding the property as they wonder, “Why has this house been on the market so long? There must be something wrong with it.”

Selling the home by owner, we’re already at a disadvantage. By using a CMA, we’ll know that we’re priced accurately and competitively but also be assured that we’re not leaving any money on the table.

A CMA can be done by any real estate agent and costs nothing. (If someone tries to charge you, look elsewhere.)

You may be asking yourself, “I thought we weren’t using any realtors?” You’re right; we’re not. But realtors are still happy to give you this information for free in hopes that you’ll end up listing with them or work with them in the future. Realtors deal with changing market conditions on a daily basis, and they’re more knowledgeable on the housing landscape where you live. Let them do this piece for you. Do NOT try to price the house yourself.

Call several agents in your area and ask for a Comparable Market Analysis. Be very clear that you are only interested in a CMA and are not looking to list with them under contract. If they ask you to sign anything, decline. They may say they want to keep your information private and need your signature to do so, but that is not the case. Anything needed for a CMA can be done by looking up your home on the MLS (Multiple Listing Service) or calling the county assessor’s office. Everything regarding your mortgage is public record.

Don’t rely on a single CMA to price your home. Before listing our home, we talked to a dozen different realtors. We used their estimates to get an accurate baseline for where we wanted to list the house. The first realtor we talked to did a poor job and actually under-estimated the value of our home by $15,000. Had we stopped after one CMA, we would have left a significant chunk of money on the table.

The housing market can change so quickly, even in a matter of days. Be sure to get your CMAs completed as close as possible to when you’re ready to list your home.

Staging your Home

staging your home

Touching on all aspects of staging a home in a single article would be impossible. In fact, there are infinitely better guides on the internet for staging your home than I could ever write. However, the idea behind staging is to prep your house so that it appeals to the largest number of buyers.

The biggest tip I can offer is to clear the clutter. Get rid of EVERYTHING on kitchen counters, or at least strip it down to the essentials. Move coffee pots, toasters, and Kitchen Aids into cabinets or even off-site temporarily. Remove toiletries such as tooth brushes, hair products, and perfumes from bathroom counters. The tops of all counters should be spotless. By removing clutter, you open up the space making it appear larger to prospective buyers.

Some people may argue, “But it’s my style!” Guess what? It may not be the style of those who are visiting your home.

Remove as many personalized decorations as possible. Family pictures or large signs displaying your last name must go. When people enter your home, they want to envision themselves living in this space. That’s hard to do with a large family photo displayed in the front room.

You may need to rearrange furniture to maximize space or to make the room feel more inviting, even if it isn’t the most practical set up for your family. The biggest deterrent is seeing the backs of chairs or couches as you enter a room. This leaves a buyer with the perception of a small, closed off space. As you walk into a room, movement shouldn’t be inhibited by furniture that you have to navigate around.

Choose neutral colors in common spaces such as the master bedroom. Men don’t want to walk into a wall of pink and purple in a room where they’re supposed to sleep. I realize that it’s easy to paint over a wall with a new color, but most people either 1) don’t have the technical know-how to do it, or 2) can’t envision what a new paint color would look like or don’t know what color would best suit them.

Use candle warmers or other scents to make the home smell pleasant, but use them sparingly. We want the house to smell “homey,” but don’t over-do it. It could raise a red flag to a prospective buyer that you may be attempting to mask odors such as animal smells.

Try to aim for a bright, light look. Brighter rooms appear larger while darker colors and lighting will make the room feel smaller. Be sure to open blinds and pull back those curtains when it comes time for a showing. If your lampshades are old or looking a little dingy, replace them, or maybe get new lighting altogether. You may not want to invest a bunch of money in lighting (which definitely isn’t necessary), but sprucing up a thing or two here and there won’t hurt. Plus, once you sell the house and move into your new one, you’ll have some great new décor!

You may be trying to sell a restored Victorian, but buyers may not want to see oil lamps and fainting couches in every single room. Remember – buyers are trying to envision themselves living there, and it’s our job to help them get there.

There are infinitely more tips and tricks to staging your house. It would be impossible to list them all here. The key here is to not go overboard but make your home appear to be in tip-top shape during the showing.

Photography

I cannot stress heavily enough that you MAY NOT, UNDER ANY CIRCUMSTANCE, USE YOUR CELL PHONE to take pictures of your house. I realize that we’re trying to save some money here, but photography is not the place to skimp.

Prospective buyers are going to be looking on Facebook, Zillow, Craigslist, and other listing sites to find your property. You have less than 10 seconds to make an impression on them. Do you really want to lose it by posting a dark, dingy photo of your home?

Take a look at these photos. Performing a 30-second search on Zillow of “For Sale by Owner” properties provides me with this. One of these photos is a dead giveaway that it was not done by a professional.

bad real estate photos

When I click through the listing photos, I can’t help but think, “Neat. You own a chair.”

bad real estate photos

Or, “Cool. There are stairs in the house.”

bad real estate photos

I bet in real life, this room is actually quite large. If so, why are you using your cell phone to take a vertical photo of it?

bad real estate photos

This is also not the time to invite your friend over who says she “takes pictures” and has a “really nice camera.” We’re looking for top-notch professional work here. Reach out to someone in your area who specializes in real estate photography.

It wouldn’t be uncommon to spend $300-400 for a quality photographer. It’s the best money you will ever spend in this whole process.

Listing Your Home

Now comes the fun part: Time to list your house and officially place it on the market.

Because we’re listing our home by owner, it won’t be on the MLS, so we’re already at a disadvantage. That said, it’s important to get your listing out to as many websites as possible. Lucky for us, most listing websites don’t cost a thing.

Property Description

Craigslist and Zillow will be the first places to post to. Comb through Zillow and look at a couple different listings to gain a feel for what’s out there. Search through listing descriptions and see what they highlight. You’ll want to come up with something catchy that focuses on the unique features of your home. This, for example, was the description we used when selling our home:

FOR SALE BY OWNER. BUYERS AGENTS WELCOME.

Contact owner at 555-555-5555.

This gorgeous, fully-updated home is located in a quiet neighborhood north of Idaho Falls. The entire house has new paint, new stone countertops in the bathrooms, new tile, and new fixtures. Upon entry, take note of the open concept making it great for gatherings with friends and family. The living room has a large sliding-glass door that leaves the space feeling light and bright. The kitchen offers loads of counter and cabinet space, with a custom-built breakfast nook providing a unique and modern seating area. Down the hall is the master suite, featuring a fully-remodeled bathroom, and a humongous walk-in closet with tons of shelf space. Outside offers a beautiful stained deck, a large yard, and a fire pit perfect for those summertime barbecues. This home is your new escape!

I want to emphasize two main things about the description above. Notably the first two lines.

First, we want to specifically clarify in our listing that “Buyers agents are welcome.” “Whoa, there. I thought we weren’t using realtors?” You’re right. We aren’t. But 95% of buyers out there ARE. Buyer’s agents don’t cost the buyer anything. (Their commission comes from proceeds for the sale of the home). If we don’t offer some sort of commission, these agents aren’t going to actively show your home to buyers.

That’s right – realtors will shy away from showing your property to their buyers and steer them elsewhere. There won’t be any money in the deal for them.

You’ll get calls from realtors just clarifying, “I see that you’re offering a buyer commission, is that correct?” To these people, I would respond, “That’s right. We’re offering a 1.5% buyer’s commission.” All the agents I spoke to seemed happy enough with this. I wouldn’t recommend going any lower than 1.5% as there won’t be enough “skin in the game” for most realtors.

The second thing to note is your phone number. Obviously, we’ll want to have contact information for people wanting to get a hold of you, but this helps us in more ways than one.

Look at the screenshot below. In this example FSBO listing, these people forgot to list their phone number in the main description. By default, Zillow places your phone number as the very last contact number in the bottom-right corner.

contact info not listed

Let’s say someone is beginning their home-buying search, they’re looking on Zillow, and they come across your listing. Zillow makes it seem as if the realtors off to the right are the agents listing your home. Not quite. Realtors pay to have their contact information listed here in hopes that people without agents will call them up, so they get the sale. And guess what? It works.

By placing your number right in the description, you may be able to grab a buyer that doesn’t already have an agent, potentially saving you even more money. If for nothing else, it’s convenient not having to search for contact information.

Other Listing Sites

In addition to Craiglist and Zillow, think of any other places you might be able to list your home. Place a copy of your listing on your personal Facebook or Instagram accounts. You might be surprised how many people in your circle may be interested in buying your home or know someone who’s looking.

Facebook Marketplace is a new area that has recently popped up. Post your home there as well as in any other “For Sale” groups in your area that feature homes for sale.

There may be some local businesses or public boards where you can share your home as well. The key here is to simply get it out to as many places as possible for maximum exposure.

Flat-fee MLS Listing Service

Let’s face it: The MLS (multiple listing service) is where you’ll get the most exposure for your house. Typically, though, this is a service provided by a realtor when you sign a contract with them.

There are, however, MLS flat-fee brokers that will list your property for a fee. Simply Google “Flat fee MLS <your city>” to find a service. These services do nothing but list your home on the MLS, period. They don’t offer any advice as far as price, description, etc.

From my experience, these range anywhere from $250 – $1000, offering various services. Be careful to read the fine print. Some of the services will list your home for cheap, but then expect a 0.5 – 1.0% of the sale proceeds when it sells. That can add up to a LOT of money, so make sure you know what you’re signing up for.

When we sold our house, we toyed with this idea but ultimately decided against it. We figured we would take a stab at selling the home without the MLS, but if it didn’t have enough interest, we would re-visit the idea later. Our house sold in 3 weeks, and we never needed to use this.

If your home has been on the market a while, but you’re having a hard time generating enough interest, this might be something to look into.

Dealing with Realtors

Within two or three days (or possibly even less), you’ll begin getting calls from multiple realtors. They may not be the kind of calls you’re hoping for, however. These will be realtors calling to ask if you want to list your home with them.

We received at least half a dozen calls from various agencies touting all sorts of facts about how “listing with an agent will sell your home faster.” Some used scare tactics, such as, “You do realize that 164% of real estate law suits come from ‘Sale By Owner’ transactions, right?” (Okay, that might be a slight exaggeration.) These agents just want a commission. Thank them, but politely dismiss them and let them know you’re confident that you can sell your house yourself. Stick to your guns, and don’t let them persuade you otherwise.

Eventually, you’ll start to get REAL calls trickling in from realtors who actually want to show your home to clients. This part is easy. Most realtors I’ve worked with are very kind and willing to work around your schedule. Set a time with them where the buyers can come walk through your home. Try to schedule the showing no farther than 36-48 hours in the future, but 24-hours or less would be better. You want buyers to come walk through your house as soon as possible, so they don’t move onto other listings.

When showing your home, it’s common practice for the homeowner to NOT be there. Having the seller there “hovering” makes the buyer feel nervous and rushed. You want them to be able to take their time and openly speak their mind as they walk through the home.

To make this process easier, place a lockbox on the front door (you can buy these at Lowe’s or Home Depot for reasonably cheap), and give the code to the realtor so they can let themselves in at the allotted time. Our rental had a keypad on the garage, so we skipped the lockbox piece and just gave out the code to the various realtors.

In our experience, the people walking through our home were very respectful. We didn’t worry about them stealing anything, but it might be a good idea to put valuables out-of-sight just in case.

Offers

Once you have a buyer come back to look at the house a second or third time, that’s a good indication that an offer is on its way. Often times, you’ll get a call directly from the real estate agent telling you that they’ve written up an offer and would like to e-mail it to you.

Looking over the offer is pretty straightforward, generally. They’ll give you an offered sales price, as well as any other concessions the buyer may have (such as appliances or decorations they’d like to include in the sale of the house).

At this point, you can either choose to accept the offer right then and there (and usually this is done through some sort of online document signing software, such as DocuSign), or you can choose to counter the offer with a higher sales price, or change some of the concessions or other terms.

Real estate markets tend to fluctuate often and will lean one way in favor of buyers or sellers. At the time of this writing, where we live in Idaho, it is a seller’s market. That usually happens when there are fewer houses on the market than there are buyers, meaning higher competition. Sellers can therefore ask for high sales prices.

During the housing market crash of 2008 and all the way through 2013 or so, it was very much a buyer’s market. There was an excess of inventory on the market, meaning the prospective buyers could name their price and get much lower sales prices because people were so desperate to sell their property.

At the time of your sale, you need to take into consideration whether it is currently a seller’s market or buyer’s market. That will determine how much negotiation leverage you will have with your sale. If you’re unsure what the market looks like, call and talk to any real estate agent. They’ll happily give you advice.

Counter Offer

I would say that you should almost always counter, no matter what. Initial offers are generally a good starting point, but it will take a few counter offers back and forth to really nail it down to where you’re at.

Be kind and thoughtful, but be sure to get what your home is worth. On the flip side, be sure to put yourself in the shoes of the buyer and imagine how they feel. Do your best to remove emotion from the sale. In the end, this is just a business deal. It isn’t meant to be an emotional experience.

It’s typical for buyers to ask for closing costs to be covered by the sellers, especially if they’re first-time home buyers. Let’s say you’re listing your home for $200,000 (to make numbers easy). If the buyers come in with an offer for $195,000, but are asking for $3,000 in closing cost assistance, that essentially means they’re asking you to sell your home for $192,000. In a situation such as this, I would counter with $198,000, but continue to cover their closing costs. This ensures they’re getting their costs covered, but you’re getting a higher sales price.

As far as physically writing up a counter offer, there are document templates you can find online if you want to make things official. However, I wouldn’t deal with the hassle. I’d call up the buyer’s realtor and verbally give them your counter offer. They will write up the offer for you, have you sign it (again, generally using some sort of e-signing software), and then present it to the buyer.

Remember that you’re still paying their realtor a 1.5% commission on the sale of your home. Make sure they work for it.

If you’re dealing with buyers without an agent, you may have to write up a counter offer yourself. Even still, this probably isn’t necessary. Instead, give them a call and hash out the details until you’re both satisfied with the deal.

Signed Offer

Eventually, you and the buyer will hash out the details, and come to an agreement. The buyer’s agent will write up a final Purchase and Sale agreement for both parties to sign. Once completed, it mostly comes down to waiting for their bank to finish up the appraisal and get all the details ready to close. Typically, this is a 30-day process.

Again, even if you don’t have an agent, make the buyer’s agent do the majority of the legwork for you. Remember that you’re paying them a commission, and they need to earn their keep.

What do you do for paperwork, if neither you nor the buyer are represented by an agent? Make sure they talk to their bank to get the financing portion started, and then both you and they will agree on a title company.

Inspection and Appraisal

In most cases, the buyer has the option to order an inspection (paid by them) within the first 7 – 10 business days after the signing of the final offer. This is just to ensure that they’re not going to run into any unexpected issues with the house that they weren’t aware of. It’s very likely that the inspection will turn up a couple things (generally nothing major) that the buyers will ask you to fix.

You have the option to either accept or reject their inspection contingencies. It’s usually in your best interest to fix what they’re requesting unless they’re being ridiculous. I’ve rarely run into this as most agents are good at grounding buyer’s inflated expectations.

A week or two after the inspection, unless the buyers are paying with all cash, their bank will order an appraisal. This provides a safety-net for the bank, ensuring that the money they’re lending to the buyer is actually worth the asset (your house). The appraisal cost is covered by the bank, but they will want to coordinate with you and your schedule.

Title Company

When it comes down to it, the title company is really the entity that does the majority of the transaction. They facilitate the exchange of funds, make sure all the deeds are signed, and get everything recorded at the county offices.

Usually the buyers will choose a title company that they want to go through. If they don’t have a preference, you may be able to choose one you like. In most cases, they all perform the same function and where you go doesn’t matter too much.

Most title companies provide a “For Sale By Owner” packet, as well. If both you and the buyers aren’t represented by an agent, you can call up the title company and tell them you’re selling your home without an agent and would like a FSBO packet. They’ll e-mail you a PDF generally, that both you and the buyers will need to fill out. Send it back to them, and they’ll get to work.

Closing

On the day of closing, both you and the buyer will go to the title company, sign a million pieces of paper, and leave with carpal tunnel. You’ll hand over keys; they’ll hand you a check. Done!

Bonus tip: Don’t forget to take a picture in front of your house one last time!

house sell
My wife and I in front of our rental property, the day before closing

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