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‘For Sale By Owner’: What Does it Mean, and What Does it Entail?

Posted by Hughes Group Blog Team on Friday, April 21st, 2017 at 5:55pm.

 

The phrase “For Sale By Owner” is something most of us have heard but not a lot of us really understand. When it comes to houses on the market, what does it really mean to the buyer and seller for a house to be “For Sale By Owner” (also referred to as FSBO)? On the surface, the difference is simple: when a house is FSBO, there is no listing agent associated with the house and its selling process. That’s right—the seller is their own agent. This seems like it could be either really beneficial or really awful, right? Well, when done correctly, it can be an amazing path to take. However, it’s not the path for everyone.

If a person were to sell his or her house without a listing agent, he or she would need to be familiar with the housing market and the process of selling a house. This can get tricky. So, is it worth it to sell a house this way? The truth is, it can be. You just have to make sure it’s the right road for you.

To check if FSBO selling is right for you, go over the following checklist and think about your own knowledge of the industry. Do you have knowledge about:

*The housing market

*Marketing houses and business techniques

*How to accurately price a house

*The legal aspects that go into buying and selling (and protecting) a house and the parties involved

*How to process goes and what it necessitates

It can be alluring to try to sell your house without an agent to pay, but first you have to weigh the costs and benefits to make sure it’s truly the best option. Legal fees and processes that need to be redone can end up causing you more money, and that’s not even mentioning if you price your house too low or settle on a weak price for the market. If you honestly have no place to start, it would probably be best to hire someone who knows the ins and outs of the industry and of the process of buying and selling a house.

However, if you have been involved in this type of process before or know most of what needs to be done, it is possible the selling your house with the FSBO strategy could be best for you. If you are great at marketing and know exactly what price would be good for your house and know about the overall process of buying a house but maybe don’t know everything on the legal end, consider seeking the help of an agent. You don’t need to hire this agent, but paying an agent to talk with you about what you need help with could give you the knowledge you need without breaking your bank. The fee of an agent consultation is a small price to pay for the money you would be saving in the long run, so if there is any aspect you’d need help with in the house selling process, don’t be afraid to seek help. Agents are everywhere, so find a good one who offers consultation services, or would be willing to do so for a one-time fee.

Ready to get started? If you think you’re ready to be a FSBO seller, remember these important tips:

*The two most important aspects of selling your home without an agent are fixing it up before it gets shown and pricing it correctly. Doing this will get you ready and will make a world of difference. If a potential buyer walks into your house and there are dirty dishes in the sink and clothes crumpled in the corner, it will leave a bad taste in their mouth and give them a bad impression, regardless of how the house itself is built and how its structure looks. Tidy your house up and price it well, and you’ll do great.

*Legally, the most important thing for you to do is to draw up contracts and to draw them up the right way. Make sure you don’t miss anything and you don’t have invalid documents for the buyer to sign. Be sure you cover yourself and put things in writing. For instance, if you have a crack in the garage, be sure to mention that in the papers so the buyer can’t file a lawsuit against you and accuse you of fraudulent activity. Warn them of any problems with the house at all, and put it all in writing.

*Marketing is huge. Your house isn’t going to sell itself, and since you don’t have an agent when you’re selling your house the FSBO way, marketing is even more critical for you to take into account. Tell everyone you know about the house—family, friends, your neighbor’s dog—and make some great flyers. Get professional photos taken of your house and talk it up. Don’t falsely sell it by building it up to more than it is, but describe it in a way that really brings out its beauty. For instance, calling your living room a “grand entrance where loved ones can gather by the fireplace” is more sellable than just saying “includes one living room.” Get creative, and run ideas by people you trust. You don’t want to go overboard in the descriptions and language, so getting others’ opinions is a good idea.

Many people don’t realize they can take this route; they see a “For Sale By Owner” sign and think nothing of it. However, there’s more to this route than meets the eye. Once you know more about it, the more enticing it becomes. It is a great option for some, but not for others. So, if you are considering taking the “For Sale By Owner” road in the selling of your house, be sure to go over what you’d need to do and make sure the benefits outweigh the costs.

 

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