We all know what happens when it’s time to sell your house — you tidy things up then hire a realtor to take care of the rest. But not everyone is convinced of the benefits of using a realtor, and some choose to sell their homes themselves.
Selling a home for sale by owner (FSBO) can have some serious advantages. It can save you money that you otherwise would have spent on the realtor, it gives you greater control over the entire process and it can help you streamline everything from beginning to end.
But it’s difficult to know where to start. We help break down everything you need to know about selling your house without a realtor, from the pros and cons to the steps you’ll need to take to complete the process. Keep reading to learn more.
The main con of selling a home without a realtor is that you miss out on the professional expertise real estate agents can provide to get you the best value on your home. But if you do it right, there can be so many benefits to FSBO home sales.
You don’t have to do it alone. At Bungalo®, we’re completely transforming the way people buy and sell homes. Our online home marketplace makes the home-selling process simpler and more straightforward, making it easier than ever before to sell your home without a real estate professional.
Put simply, if you don’t have to pay for a real estate agent, you’ll save money on your home sale. This is one of the top reasons homeowners choose to sell their homes without an agent, and it can really pay off if you do it right. According to Bankrate, real estate commission typically ranges from 5-6% of the final sales price of the home, and that can really add up if your home sells for a lot.
If you sell a home for $200,000 using a real estate agent that charges 5% commission, you will end up paying the realtor $10,000. That’s a hefty chunk of cash!
Another great benefit to selling your home FSBO is that you’re in complete control of the entire process. That means you get to market it how you want at the price you want, and you’re in charge of negotiating with potential buyers. For those who know their stuff, that can be a real advantage. There won’t be any conflicting opinions between different stakeholders, and you ultimately get the comfort of knowing that the sale was completely yours.
One of the great benefits of FSBO home sales is that the entire process tends to be much faster than going through a realtor. That’s partly because real estate agents usually have a large portfolio consisting of numerous buyers and sellers, so their attention is split across different individuals. When you do it yourself, you can devote as much time as you want to the process, meaning it’s all streamlined, and you can get in front of buyers much faster. Data from the National Association of Realtors showed that 58% of FSBO homes sold in under 2 weeks in 2019.
Another reason that the process is so much more efficient is that homesellers tend to rely on people they already know. They don’t have to spend time building trust and rapport with potential buyers as one would when selling to someone they don’t know, and that can shave off several weeks from the whole process.
If you’re ready to sell your home, and you’re convinced FSBO is the way to go, it’s tempting to start taking pictures and posting them to your favorite listing site. But before you do that, you need to have a few key documents together before you can formally sell the property. Others, you’ll need to show potential buyers before you even make the sale.
Here are some of the most common:
Of course, these are far from the only ones you’ll need. Others include:
When dealing with potential buyers, the biggest headaches are going to come from negotiating the sale price of your home. Prepare to hold your own, but also be ready to be flexible — it’s a tough balance to strike, but we trust you! These are some of the things you should know when dealing with potential buyers:
You might think that the most important factor when it comes to selling (and pricing) your property is how lovely your home looks inside and out. While that’s certainly a key part of it, there are several others, too.
Of course! You can sell your home for whatever price you and your buyer agree to, and that could be more or less than its market value. It might sound ridiculous, but sometimes selling your home for less than market value is the right move. Maybe you’re looking to make a quick move and are willing to fork over a few extra thousand to get out faster. A lower price will attract more buyers, especially those looking to get the most bang for their buck.
Sometimes you have no choice. Maybe the housing market’s really bad, and you just know you’re never going to get anyone to pay what you initially paid for it. The best strategy here is to wait a few years and put your home back on the market when housing prices are back up. If you can’t wait, then it might make more sense to sell it now and stomach the losses.
Whatever your reason, it’s important to keep in mind that you still owe your mortgage provider any liens still attached to the house. A lien is the amount of interest a mortgage provider has in your home, which is determined by the amount you still owe on the original loan. Selling your home below its market value can make it harder for you to cover any liens (and might force you to look elsewhere for finances), so make sure this is definitely the right move for you first.
OK, you’ve weighed the pros and cons and decided that an FSBO home sale is the move for you. Great. Now what? Follow these steps to know exactly what you need to do once you’re ready to put your house on the real estate market.
It can seem like you don’t have the skills or the knowledge it takes to sell your home FSBO. That stuff’s for realtors. But with the right preparation and planning, you can reap all the benefits that come with selling your home without a real estate agent. Just know what documents you need to have on hand, understand what factors affect your home’s selling price, and get a feel for the sales process, and you’ll be selling your home like a pro in no time.
Bungalo can be by your side in all this. We help make the process hassle-free by letting you sell your house without the repairs, tours, and showings that usually come with selling a home. Check out our blog for our latest home-selling insights, and take a look at our website to get started.
This article is meant for informational purposes only and is not intended to be construed as financial, tax, legal, real estate, insurance, or investment advice. Bungalo always encourages you to reach out to an advisor regarding your own situation.
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