Selling your own home can be a daunting task. While there are some upsides to FSBO (For Sale By Owner) there are also lots of mistakes and pitfalls that can easily befall a new seller. Learn the top 5 mistakes from FSBO homeowners.
1) Pricing Your Home Too High, Selling Your Home for Too Low
This sounds counterintuitive but it’s true: studies show that the #1 reason why for sale by owner homes sit on the market is because of the wrong asking price. Because we attach emotional value to our home, it’s often difficult to be realistic about its worth. A realtor spends their career studying the housing market in a specific area, so it’s understandable why it would take a FSBO a bit of time to catch up. When FSBO homes do sell, statistics show that it’s an average of 15% less than comparable homes represented by a realtor. This makes sense when you consider the most common pitfall of FSBO: pricing a home too high, watching it sit on the market for months, then adjusting expectations too low and selling the home for below its worth.
2) Not Understanding Financial and Legal Liability
The second most common mistake in homes for sale by owner has to do with paperwork (and there’s a ton of it!). There are many factors when getting a home ready to sell, and its very important to have all the financial and legal paperwork in order and done properly. Before you begin showings you’ll need a survey that shows property boundaries, your latest property tax bill, and copies of the homeowners’ association covenants (to name a few). If any of these documents isn’t done properly, it could delay, stall or even forfeit a sale. Check out For Sale By Owner’s complete list of the paperwork you’ll need before showings and for the final contract.
3) Not Putting in the Time
It’s important for FSBO homeowners to understand the amount of time that realtors put in to sell a home. Realtors often work upwards of 50-60 hours per week to update listings, stage homes and respond to potential buyers. You must be ready to be available at all times to call back interested buyers, host open houses, and manage online listings. Check out our 7 Tips For Selling Fast for tips and tricks for using your time productively.
4) Not Making The Home Look Good
Another common mistake in FSBO is not making the home prepared for showings. Not only is staging important (check out 7 Things to Consider When Staging Your Home) but so is having professional-quality photographs to display online. This is one case where just running a vacuum and using your iPhone camera isn’t going to cut it. You’ll be competing in the marketplace with professionally decorated, cleaned, lit, and photographed homes.
5) Getting Taken Advantage Of
The final mistake often made by FSBOs is through no fault of their own. Sellers are often the targets of scammers who hope to take advantage of their lack of experience in the marketplace. Home inspections can be problematic, and sometimes an inspector will cite issues with the home that may not be the legal responsibility of the homeowner. A good realtor knows the laws in your area and will be able to protect you from this. Another common issue is not making sure buyers are qualified before pulling the home off the market. It’s very important to make sure your buyers have a pre-qualification letter and are able to actually move forward with purchasing your home.
While selling your home yourself does have some advantages, it also has some downsides. A good real estate agent can make sure your home is priced properly, looks great, and will sell fast. More than that, they’ll save you the headache of heaps of legal paperwork and hours of showings.