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The 5 Steps to Selling Your Home on Your Own
While it’s not always advisable, it’s definitely possible to sell your home on your own – in other words, without a Realtor. If you’re organized and follow the steps below, you can potentially save 2-3% in Realtor commissions. On an average home price, this means savings anywhere from $3000 – $4500!
Now please keep in mind: this will mean spending around $1,000 up front to really do everything correctly. You can simply look at this as an investment in saving money, however, once you actually sell the home.
Step 1 – Get your home professionally inspected.
Depending on the size of your home, this will cost anywhere from $200 to $400. Almost all buyers will get a home inspected, but I recommend you – the seller – do it yourself before putting the home on the market.
The reason for this is simple: you need to know more about the home than your buyer does when it comes time to negotiate price.
Normally the home goes under contract at a specific price, then the potential buyer gets the home inspected. This puts you, the seller, at a disadvantage. The reason being, it’s better for you to know any potential problems when you are pricing the home, rather then finding them out once you have a buyer.
Let me put it this way: do you know if your home is wired up to code? Unless you’re an electrician, you probably don’t. Now think about this: which would be better, for you to know that your home isn’t wired up to code and price it accordingly, or for you to find this out after a buyer has your home under contract?
In a home negotiation, knowledge is power! It’s worth $300 to get the edge in this department.
Also make sure you get a termite inspection if termites are an issue where you live. Termites can destroy your home quickly, and many times you won’t know this until it’s too late. The good news is most termite companies will inspect your home for free as a way to earn your business. You can even have more than one company do this inspection.
I recommend you do these inspections before you do anything else. The home inspection usually takes about 3 hours, and the termite inspection takes about 1 hour. Other than letting the inspectors inside, you don’t even have to be present in the home! Most inspectors can schedule their work to be completed within a week’s time.
Step 2 – Get three contractors’ bids on each major item that needs repair.
After the inspections, you will know what’s what. You then should consider repairing major items. These include: foundation, electric, plumbing, HVAC, framing, and roof work. If any of those things show up on the inspection report, get three different contractors to look at the issue and give you a bid. Make sure you get these bids in writing
Additionally, you’ll want to bring in contractors on any big cosmetic issues. If you have old carpets, holes in the wall, broken windows, etc, you will want to know what is costs to fix or redo them.
Now, none of this means that you need to actually fix anything. This depends on how the housing market is doing in your area. If homes are selling quickly, I recommend not making any repairs and just selling the home “As-Is,” with the cost of these repairs subtracted from the price.
If it’s a tougher market for sellers – or what’s often known as a “buyer’s market” – then you may need to look at getting the major items fixed or allowing for an additional “repair allowance.”
This will be a big help in your price negotiation. If your buyer brings up an issue, you will already have contractor bids in hand. You can simply adjust the price in a way that works better for you both. Plus, when you show that you’ve done your homework, a buyer is usually less likely to resist in whatever price adjustment you offer.
Step 3 – Find out what homes are selling for in your neighborhood.
I emphasize the word selling as it doesn’t matter 1) what a home is listing for or 2) what you think it’s worth. A home’s value is what a buyer is able and willing to pay for it.
You may need to consult with a Realtor to find out what other homes have sold for. Many will be happy to do a market analysis and let you know a good selling price for your home. This does NOT lock you into working with that Realtor, but make sure you let them know in advance that you are going to sell the home on your own. That same Realtor can always find you a buyer, so doing this number analysis can benefit both parties.
Pricing the home correctly is critical, so you need to also factor in the price of any repairs needed. My suggestion is to simply subtract their cost from your asking price and sell the home “As-is.”
Having the bids from contractors about the repair costs will help show your potential buyer (and the buyer Realtor involved) that you are serious and organized. It can speed up the selling process as sometimes the buyer won’t even require a new inspection, and this open transparency on your part is the key to getting a deal done fast.
Step 4 – Clean, de-junk, and stage your home
You want your home to be as clean and clutter free as possible. If this is easy for you, then by all means do it yourself. If not, I’d recommend “Got Junk” to get rid of any clutter and then a cleaning service.
You want as few of your own personal items in your home as possible. You might even consider renting out a storage place for a few months as well.
You want to stage your home which basically means removing personal items and arranging your furniture in a simple way.
The basic idea behind staging is that your potential buyer will start to “see” their own furniture in your house. Once this happens, they’ve started to buy your home already. It might sound strange, but homes that are staged sell 79 percent faster!
The other benefit of doing all of this is that it will make your move much easier. Let’s face it, you need to get rid of that junk sooner or later anyway. So why not do it before you move out and make a faster, more profitable home sale along the way!
Step 5 – List your home on MLS fee sites and all the other important online places
One of the best things that a Realtor can do for you is list your home on the MLS (Multiple Listing Service). There are Realtors out there that will do this for a small fee (usually around $200). They take no commission, just the upfront fee. This will expose your home to all the Realtors who have buyers.
The second thing I recommend is to put your home on Postlets. It’s a free site that will put your home on Zillow, Yahoo, and Craigslist. These sites have a huge number of potential buyers for your home.
The last thing you may want to do is put up a “For Sale By Owner” sign. Some people prefer not to do this for various reasons related to privacy and safety. I personally don’t think it’s too important to use a “For Sale By Owner” sign unless there are a lot of car and/or pedestrian traffic near your home.
The most important thing once you’ve done the previous 4 steps is to make sure as many qualified buyers as possible know about your home. By putting your home on the MLS and Zillow you are making serious homebuyers aware of it.
If you want to minimize tire kickers even further, you can opt to only show the home to buyers who can prove they are pre-approved by a lender or have enough cash to buy your home outright. Serious buyers will have no problem doing this, especially if it’s a competitive market.
Those are the five crucial steps I’ve used on every site built and mobile home that I’ve sold. The vast majority of the homes have gone under contract in less that 28 days, so it’s worked well for me – it should work for you as well!
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