Dan and I purchased our first home, a For Sale by Owner townhouse in Chicago, without any realtors involved. We then sold two homes by owner because we wanted to save on the realtor’s commissions. If you want to do the same (either buying or selling a FSBO home), I’ll tell you what worked for us. Realtors, I have some tips for you as well on how to improve your chances of turning the For Sale By Owner seller into a client.
For Sale By Owner Sellers: How to Sell a House Without a Realtor
Whether or not you work with a realtor, as a homeseller you need to declutter, stage your house, and keep it clean for showings. Then, there are the things that the realtor typically handles: photography, pricing the home, showing the house, and negotiating the terms with potential buyers. You need to determine if it’s worth foregoing the realtor’s expertise to save the 2-3% commission. (To help you through this, please check out my 15 Tips for For Sale By Owner sellers).
As a quick evaluation, see if you agree or disagree with these statements.
- My friends would describe me as reliable and hard-working. (Y/N)
- I enjoy evaluating home prices in my area. (Y/N)
- I take feedback well and will not be offended if someone insults my home. (Y/N)
- Negotiations are fun. (Y/N).
- No one will do a better job selling my house than I will. (Y/N).
Yes, there’s more to selling a house by owner than this, but at least you’ll get a general idea if you’re up for the task. My main advice to FSBO sellers is to work harder than you’ve ever worked before to get your house in top shape, be realistic about your house price, and recognize that this is a business transaction. Stop thinking of it as your home and start thinking of it as a house you want to sell for the best price you can (Again, be realistic!).
For Sale By Owner Buyers: How to Buy a FSBO House
While my husband and I enjoyed selling our houses by owner because of the saved commission fees, buying a FSBO home was even more fun. One Saturday we visited a FSBO open house in Chicago. Later that evening we called the sellers and said we would like to make an offer.
They said, “Come over tomorrow morning. We’ll provide the coffee.”
“Great!” we told them. “We’ll provide the muffins.”
After a ten minute negotiation over coffee and homemade blueberry muffins, we bought our first home without any realtors involved. While this may seem rash, we had seen enough houses and done enough research to know the perfect house when we saw it. We knew our budget and stuck to our price throughout the negotiation.
If you are a buyer interested in purchasing a For Sale By Owner home, recognize that this is a more personal transaction than your typical home buying experience. Instead of two realtors talking through the details, you or your realtor will work directly with the seller. The home seller may be at the house when you do a walk-through, so be kind.
Imagine it’s your mom or best friend selling her house. Would you insult the outdated wallpaper or the view of the garbage cans? Hopefully not. Keep the criticism to yourself while you tour the house and share your thoughts with your realtor or partner after the showing. The typical seller wants the best price possible for her home. The FSBO seller wants the best price from someone that she likes.
Realtors: How to Get a For Sale By Owner Seller as a Client
When we sold our house by owner, realtors would show up to offer their services. We strongly preferred the more laid-back sales pitch.
Realtors, recognize who your potential client is: someone who believes she can do a better job selling her house than anyone else. Refrain from telling that type of person, “I can get you more money and a quicker sale.” Why? Because the FSBO seller doesn’t believe that or she would’ve hired a realtor in the first place. You want to be on her side, not against her.
Instead, try a different approach and compliment the seller on everything she’s doing right. Say something like, “Your MLS photos look amazing” or “Did you get a home stager? The place looks great.” Be genuine and let the seller know that you are available if she ever needs any assistance. You will stand out as someone who has confidence in the seller’s ability to sell on her own. If the place does sell by owner, follow-up and congratulate the seller. You will definitely be the only realtor to do that. Real estate is a relationship business and, even if you don’t get this sale, you may get her business in the future or she might recommend you to a friend.
Have you sold your home by owner or worked with a FSBO seller? I’d love to hear about it!