Selling a Home For Sale By Owner: 11 Things All Home Sellers Should Know

Founder, Condoblackbook.com & Owner/Broker, HB Roswell Realty
Selling a Home For Sale By Owner: 11 Things All Home Sellers Should Know
Founder, Condoblackbook.com & Owner/Broker, HB Roswell Realty

Jan 14, 2019 January 14, 2019

When selling your home, it’s understandable that you’ll want to make as much money as possible from the sale, and you may be weighing the pros and cons of saving a little money by selling the home yourself without hiring a real estate agent. Real estate agents typically charge a 5-7% commission on the sale price of your home, so you could potentially save thousands of dollars by selling the home yourself, and this is the most common reason why home sellers make the decision to sell on their own. But is it a sound decision?

While saving money on commission sounds like it could be a benefit, there are actually several drawbacks to selling the home yourself unless you happen to be very well trained and experienced in the field of real estate, have lots of time on your hands, are a whiz at marketing, and have some legal know-how. According to The National Association of Realtors, more than 90% of all properties listed for sale by owner fail to sell, and sellers end up having to hire a real estate agent in the end anyway.

Below are some considerations that you must take into account if you are considering listing your home for sale by owner.

1. The most successful instances of sale by owner occur when the home is highly visible on a busy street.

The most successful instances of sale by owner occur when the home is highly visible on a busy street.

 

If your home is on a busy street and you’ve put up a highly visible sign, it’s possible that passers-by may inquire about it, and a sale may result from this. Other successful sales occur when the home is in a neighborhood where several other homes are listed for sale by real estate agents. In these instances a seller may be able to profit from the marketing strategies of a good realtor who is successfully drawing buyers into the neighborhood to view properties they have listed. This means that if you are selling a condominium unit located inside a building, you will probably require the services of a good real estate agent, as specific condo units for sale are not normally visible from the street (as most of the time the association does not allow signs) and it will be nearly impossible to get anyone to view your home.

2. You may not save as much as you imagine when selling your home for sale by owner.

You may not save as much as you imagine when selling your home for sale by owner.

While you may save money by bypassing the realtor’s commission fee, the likelihood of fetching the best possible price for your home decreases substantially when you go it alone. Buyers look at for sale by owners as targets to get better deals, so they already come in with the expectation of negotiating you down. Typically, these buyers are looking for a cheap deal that benefits them, and assume that you will be willing to sell for a lower price since you won’t be paying a real estate agent’s fee. And in fact, most homes listed for sale by owner that do end up selling actually end up selling for less than what a professional realtor could have garnered for the sale.

You’ll also have to invest heavily in marketing, and devote considerable time to the sale of your home, potentially detracting from other income-earning activities. So in the end, you may not end up netting more.

3. The biggest mistake owners make when selling their homes is setting the wrong asking price.

The biggest mistake owners make when selling their homes is setting the wrong asking price.

Unless you happen to be a real estate expert yourself, you’ll benefit from the guidance of a competent real estate agent or property appraiser to help you set the right price for your home, as this task is one of the most difficult when it comes to selling properties. Even if you don’t want to hire the realtor to carry out the full sale, you should at least consider paying for a consultation with a seasoned and successful professional in the field to help you set the right price for your home. Actually, even some experienced real estate agents manage to set incorrect sale prices every day, so be sure to look for an agent that has a successful track record of selling homes in your area at top market value.

4. Marketing a condominium property for sale requires an established network.

Marketing a condominium property for sale requires an established network.

It’s easy enough to list your home online and anybody can do it. But to actually attract buyers - the right kind of buyers for your home - will require much more than this. When a real estate agent lists a home online, they have access to a huge network of agents that are working to attract potential buyers in your area. Realtors benefit from the extensive reach of the Multiple Listing Service (MLS), as well as established sites such as Realtor.com where listings may be seen by hundreds of potential buyers. In addition, top real estate agents network with top real estate agents, and most of the sales happen within those agent-to-agent communications and networking. A good real estate agent is poised to reach a target market that your simple online listing could never aspire to, and most invest a sizable amount in expanding their reach through advanced marketing strategies. The best real estate agents operate through sophisticated websites that are magnets for prospects because they employ the services of top-quality, professional marketing consultants, as well as professionals who take care of such tasks as photographing and videoing properties, building the website, and writing the marketing copy.  

5. Selling a home requires a lot of time.

Selling a home requires a lot of time.

Real estate agents exist because selling a property is a full-time job that requires a diverse professional team, and most sellers are individuals or couples who are busy working at other careers. To sell your home successfully, you will need to devote a considerable amount of time to the task, as you will need to develop a whole new set of skills, all of which are time-consuming. Your home will require a home inspection, and you’ll need to make any repairs necessary for legal compliance, as well as any repairs that may boost the sale of the property (again, a seasoned seller’s agent can help you assess what to fix and what not to fix). In addition to this, you must photograph, video, list, advertise, and show the property. Once an interested buyer shows up, you must be available to spend time on the phone answering their questions, as well as showing the home whenever they are available, and negotiate the correct asking price for the sale. All of this requires oodles of time (and skills) that you may not have if you are already a busy professional in a different line of business.

6. You may become a target for crime while selling your home.

You may become a target for crime while selling your home.

It goes without saying that inviting strangers into your home is a risky prospect, just as listing personal information online for the world to see surely puts your privacy at risk. For this reason, professional real estate agents have developed tried and true methods of marketing and showing properties that protect a seller’s safety and privacy. If you go it alone, you will have to deal directly with the public, so you’ll need to be especially careful with what kind of information you include in your listing, as well as highly alert when showing your home to strangers. Never show the home when you are there alone. Always request that visitors sign a guest book and present a valid ID. Remove any valuable items such as fine art or expensive electronics from view before letting anyone enter your home, and take extra precautions if you plan on staging an “open house.” Frankly, open houses are not actually all that effective at scoring sales in all cases, and they may attract thieves and scam-artists to your home. A good real estate agent may be able to advise you as to whether hosting an open house is actually a good idea in your particular situation.

7. For sale by owner sites don’t actually produce many sales.

For sale by owner sites don’t actually produce many sales.

In today’s market, the vast majority of property sales begin online, but where your home is listed online can make all the difference in the world. Unfortunately, listing your home on the most popular for sale by owner sites isn’t going to result in great success, as these sites statistically attract only a small fraction of the traffic that you may attract by listing your sale on a professional real estate site.

8. You must ensure that you are complying with all legal requirements when selling your home.

You must ensure that you are complying with all legal requirements when selling your home.
Photo credit: ccPixs.com

Laws and regulations related to home sales vary from region to region. You will have to do some due diligence and find out exactly what you have to do to comply as a seller with local regulations, and then you must prepare all required paperwork in accordance with the law. If you are unfamiliar with this process, bear in mind that it will take some time to get yourself acquainted with local regulations and really understand the way to do these things correctly. Not complying properly with legal requirements can ultimately cost you far more than a real estate agent’s fee, as failing to comply legally may open up a Pandora’s box of obstacles and headaches down the road.  For this reason, the best real estate agents have the customary do’s and don’ts down pact, and when there are questions about legal nitty gritty, they know the right professionals to call to make sure all legally copacetic.

9. You will need to make sure the buyer is qualified to buy your home.

You will need to make sure the buyer is qualified to buy your home.

In addition to all of the aforementioned tasks, an important service that a qualified and experienced real estate agent provides is the vetting of any potential buyer to make sure they are qualified to purchase your home. If you’re fortunate enough to find a buyer on your own, you will have to assume this tricky task and again, this requires some experience, skill, and insight. While you may think that this is a simple matter and a mortgage letter will suffice to vet the buyer, it’s not actually that simple. A buyer that is pre-qualified for a mortgage is not the same as one that is fully approved or even properly pre-qualified, and an inexperienced seller may lose out on a good sale due to not understanding the distinction between these classifications. In many cases, a pre-qualification may actually be worthless. Again, the expertise of an experienced real estate agent may be well worth the commission fee.

10. You probably don’t have all the skills you’ll need to sell your home and may have to pay for them.

You probably don’t have all the skills you’ll need to sell your home and may have to pay for them.

Even if you are fortunate to have plenty of free time available to attend to the sale of your home, few people actually possess the full set of skills that you’ll need to sell a home successfully in today’s market. Unless you are highly experienced in the sale of property, there will be a number of new things for you to learn through the process, and you typically won’t get the benefit of doing it over and over again in order to improve your ability at it. Many skills are required to produce a successful sale, such as setting the right asking price, making the right marketing choices to reach the right kind of buyers, determining which repairs to make, staging the home properly for presentation, qualifying a buyer, attending home inspections, and negotiating repair requests.  Additionally, you’ll need to become skilled at some of the many other services that go into the marketing and sale of a home and that real estate agents typically hire professionals to do on their behalf, such as photographing and videotaping properties, web design, writing SEO marketing copy, and maximizing your site’s exposure online. Otherwise, be prepared to shell out cash to pay for these skills and services yourself. Again, it may just be more cost-effective to hire a realtor.

11. You will very likely have to pay a buyer’s agent to help sell your home.

You will very likely have to pay a buyer’s agent to help sell your home.

In the likely event that a buyer’s agent procures a buyer who is interested in purchasing your property and qualified to buy it, as opposed to a buyer coming directly to you, you will have to pay the buyer’s agent a fee. While it may not be as high as the traditional seller’s agent fee, it will still be another expense that you will have to take into consideration when adding up the amount you can reasonably save by listing your home for sale by owner.


This information for those seeking to sell a home is provided by Sepehr Niakan, a top performing real estate agent working in the South Florida real estate market, including Midtown, Edgewater, Design District, Downtown Miami, Brickell, Coconut Grove, Upper East Side, Miami Beach, Miami Shores and other areas in the greater Miami area.

Recent Posts

Condo Living Etiquette: How to Be a Better Neighbor
Opinions and Advice Condo Living Etiquette: How to Be a Better Neighbor
Condo living is a blend of living in your own private world while coexisting with neighbors who share the comfort, convenience, and perks that the condo community provides. In order to show respect and consideration for your neighbors and keep the community energy flowing harmoniously, observing some neighborly etiquette can make life easier for everyone. We’ve put together a list to help you be a better neighbor. Say HelloIt takes only a second to say hello when you run into your neighbors in the lobby or elevator. Don’t earn yourself a reputation as being a stick-in-the-mud. Be nice. It costs nothing and goes a long way toward friendly community living. Keep the Noise DownNoise is a primary complaint among neighbors living in close quarters. Observe the rules in your building regarding noise levels after certain hours, and always show consideration for your neighbors who may maintain unusual work schedules. Don’t stomp your feet, hammer nails, or drag heavy furniture around...
Miami’s New and Pre-Construction Condo Update: June 2019
Real Estate News Miami’s New and Pre-Construction Condo Update: June 2019
The market is abuzz with condo pre-construction updates this July. We have the late Zaha Hadid-designed One Thousand Museum finally moving ahead with closings. Natiivo (Powered by Airbnb) launched sales. And, the Related Group has a new condo proposal for Terminal Island. Read on for details on these and more updates below: Foundation Pour Aston Martin Residences – Downtown 300 Biscayne Boulevard Way, Miami, Florida, 33131 This first-ever residential undertaking by Aston Martin witnessed the largest concrete foundation pour to date in Miami. After all, it is designed to rise 66 stories and become the tallest residential development South of New York City. This unique windsail-design building features the only deep-water superyacht marina in Downtown Miami, along with signature Aston Martin touches throughout its common spaces. Other amenities include an infinity pool, sky lounge, two cinemas, kids’ rooms, an art gallery, spa and barber station, optional personal butler service...
Island Gardens Mega-Yacht Marina and Resort Project Moving Forward on Watson Island
Real Estate News Island Gardens Mega-Yacht Marina and Resort Project Moving Forward on Watson Island
On Watson Island, now known as Jungle Island, the Flagstone Island Gardens development firm has been litigating with the City of Miami and winning. The firm is expecting a settlement exceeding $100M from the City so they can proceed with their $1 billion luxury Island Gardens marina and resort project.   After a Miami-Dade Circuit Court judge ruled in 2016 that the City violated a lease and illegally derailed the project for years, another ruled in March of this year that the City owes Flagstone more than the $1.5 million security deposit they paid on the project, due to "injury Flagstone suffered directly from the city’s years of delay." Flagstone is seeking a sum of about $122 million they claim to have invested in the project, which has been on the table for almost 15 years. The Island Gardens project consists of a luxury resort hotel, with high-end retail and dining, and a waterside deck set in a tropical garden, all designed with 360° views of the Miami city skyline and...
Short Term Rental Property Investment?: AirBnB Pre-construction Condo Opportunities in Miami
Real Estate News Short Term Rental Property Investment?: AirBnB Pre-construction Condo Opportunities in Miami
It’s no secret that there’s money to be made in short term vacation rental investments, particularly in a year-round sunny location with great beaches, awesome nightlife, and legendary shopping, such as Miami. In fact Airbnb rental hosts in South Florida welcomed some 1.47 million guests in 2018, earning about $315 million in the process. And business is booming as more and more tourists visit South Florida yearly. Miami a Top Pick for Airbnb Investment Ironically, while Miami is an ideal location for Airbnb investment property, Airbnb did not exactly encounter a welcome committee in Miami, and particularly in Miami Beach, where the local hotel industry wields lots of power and influence. In fact, the city of Miami Beach and Airbnb have been in litigation for a couple of years now. Property owners have been fined as much as $20,000 for listing their properties on short term rental sites such as Airbnb.com, booking.com, and others. New Airbnb-approved Condo Projects Have City’s...
New Hotel Proposed to replace Bentley Edgewater Condo Hotel
Real Estate News New Hotel Proposed to replace Bentley Edgewater Condo Hotel
A new eight-story boutique hotel has been proposed in Edgewater to replace the 36-story Bentley Edgewater condo hotel project that was recently scrapped. Developer Amaury Martinez is proposing to build The Edgewater Hotel, a 207-key hotel that will encompass nearly 159,000-square-feet of area and is earmarked for construction at 410 Northeast 35th Terrace.   While the developers have hinted that the new construction would be a Holiday Inn branded hotel, this has not been confirmed.   The eight-story construction in Edgewater is proposed to include a parking garage accommodating 139 parking spaces with valet-only access, as well as a pool and deck on the third floor, along with the usual array of resort amenities such as a spa and fitness center. The proposed hotel will house 207 rooms and is set to be designed by Kobi Karp Architecture & Interior Design.The property will also include some 2,850 square feet of ground level commercial space to accommodate retail, small...
Luxury Condo Project Moving Forward on McArthur Causeway’s Terminal Island
Real Estate News Luxury Condo Project Moving Forward on McArthur Causeway’s Terminal Island
Terminal Island is a small, triangular island off the MacArthur Causeway that up until now has not been developed for residential use. The island has been used primarily to house the fleet maintenance of vehicles such as police cars, and sanitation buildings for the City of Miami Beach, as well as a gas station for city vehicles, an electric plant, and the Fisher Island ferry terminal. There’s also an active Coast Guard station on a nearby neighboring island.   At the moment, a new condo project proposed by Related Group will start moving forward with plans to build a 35-story luxury condo tower housing some 90 residential units on Terminal island. To convince the City of Miami Beach to grant the required permit to build a 400-foot residential tower in an industrial zone, Related Group has proposed to build the city a new fleet maintenance building, providing a badly needed upgrade to the current structure. While city officials are tempted by the developer’s offer, the U.S. Coast...