With a robust real estate industry, we often assume that the only way to sell a house is by utilizing the services of a Realtor. But do you need a realtor or can you list as “for sale by owner” instead? At upwards of 6% on a $300k home, that’s quite a chunk out of your profit when you hire a realtor to sell your home. As most of us in the military only live in one area for a short period of time, you may not have that in equity when the time to sell does come. If this isn’t your first rodeo, or if you don’t have enough equity in the house to pay realtor’s fees, you might be ready to consider selling your home on your own as a For Sale by Owner or FSBO.

7 Tips when Considering to Sell For Sale by Owner

Is “For Sale by Owner” for us?

Be honest about your time. It’s a lot of work to get it ready, market it, manage showings, and make sure all the legal paperwork is finished at the right time. If that’s too much, hire a Realtor. Also, make sure you have the time for it to sit on the market. Most homes FSBO take much longer to sell because of pricing issues, marketing issues, or simply because Realtor’s aren’t willing to show it to their clients. If you have 3 months or more to sell it and homes are going relatively quickly, an extra month wont put you behind. If you need to find a buyer ASAP, let a Realtor handle it so you can focus on other things and get max visibility.

7 Tips To Help You List Your Home As For Sale By Owner

Getting the House Ready When You Sell For Sale By Owner

The largest portion of the market is looking for something that is move-in ready. This means the paint is neutral, floors are usable, and there are no major projects that need to be completed before move-in. If you want to get top dollar for your home, finish the above before you take pictures and before you list it. If you’re ok selling a “fixer-upper”, list it at a price that accounts for those repairs, but also know that people will try to negotiate you down significantly anyways. 

RELATED: All of Your VA Loan Questions Answered

You will also need to hire a professional real estate photographer to come and photograph your home. Your camera phone and point and shoot camera are not going to cut it. Your friend who photographs babies is also likely not going to be able to do your house justice. A real estate photographer will give you guidance about decluttering, the best time of day, and good placement of belongings to best showcase your home. 

Also, check to see what documents you need to deliver to a potential buyer. Most states have a disclosure statement, HOA statement, Oil and Mineral rights disclosure, or various other documents. These are documents that will protect you as well as inform a buyer. If you choose NOT to deliver these documents, a buyer may have the right to cancel the sale at any time or even sue you later if a problem arises you may have known about and chose not to disclose. A quick google search for “(state)  real estate disclosure forms” will yield you a good place to start.

Pricing You Home as For Sale By Owner

You’ve fixed all the problems, made the paint neutral, had professional pictures taken, and now you’re ready to settle on a list price and get it out there. Some people choose to get an appraisal to help with the price. Others choose to look at what is currently available and go off of that. However, you pick a price, make sure you can justify it. If it’s abnormally high, people will assume you aren’t willing to negotiate and won’t even call you. Also, know what your bottom price is after taking closing costs into consideration. Just because someone offers you $300,000 doesn’t mean you get to keep all of that. It seems like everyone has their hands in the pot at closing and it eats away at your profit. Know what your break-even or no less than number is after accounting for all the extra costs.

7 Tips To Help You List Your Home As For Sale By Owner

Marketing Your Home as For Sale By Owner

One of the most useful services a Realtor provides is marketing. If no one sees your house, no one will buy it. That being said, the MLS is not exclusively available to people with full-service agents. There are numerous listing services where you can pay a small fee to a Realtor to list it on the MLS for you. This is dramatically less than a standard commission, but you also don’t get any help writing it and you may have restrictions about listing with an agent if you can’t sell it yourself. 

You can also list it yourself on places like Zillow.com, Trulia.com, MilitaryByOwner.com, AHRN.com, and numerous others. Some charge fees, others do not. Either way, you want your house to show well. Look at listings by successful Realtors and see what they choose to feature. Once you list it, email it to anyone and everyone you can. Some sellers are willing to offer a buyer’s agent commission and/or a bonus to that agent. If that’s you, definitely put it in the listing! The first question you’ll get when an agent calls is “are you willing to work with a buyer’s agent?” This will help you get visibility, but it will cost you some money. You will also have a buyer with professional representation when you yourself do not. Be very careful about proceeding this way as not all professionals are honest. It’s very easy to be taken advantage of if you don’t know what you’re looking at when they send you the paperwork. 

RELATED: 8 House Hunting Websites to Use a Military Family

Negotiating Your Home when You’re Selling For Sale by Owner

Whether you get an offer on an official offer sheet or an informal email, read it CAREFULLY. They may offer you a reasonable price and then slip in a ten thousand dollar concession in the fine print that you pay them at closing. Most people are comfortable with negotiations going a certain way. They offer less than you want, you come back and decrease your asking price, they come up a little in their offer, and you eventually meet roughly in the middle. Most aren’t comfortable going back numerous times, so know what your bottom price is and let them know when you won’t go any lower so everyone can move on once you get there. 

Also, keep in mind that you can negotiate other parts of the contract that don’t cost you much money. You can offer a home inspection for around $600 in lieu of fixing every item on the inspection list. More earnest money from them means a deal is more likely to go through since they will not get that money back if they breach the contract. You may be willing to accept a lower offer on the higher chance the sale will go through.

Inspection and Appraisal Process as For Sale By Owner

Once you have an accepted offer, inspection and appraisal should happen. These are on the buyer and the buyer’s lender to schedule, so you’ll just need to allow the professionals access to the house at some point. 

The inspection will look at every corner of the house to find potential cosmetic, electrical, structural, or operational problems. Every inspection (even on brand new construction) comes back with some number of items that could be fixed. Some of these are cosmetic, but some may be significant. Whether the buyer will continue with the purchase after the inspection completely depends on their comfort level with repairs. Many people just want to move in and do no work. If that’s your buyer, they may ask you to fix a bunch of stuff before closing. Don’t be offended by this. Some items must be fixed before the home can legally be sold (check your state for specifics). Other items will cost them money out of pocket which they may not have after a down payment, whereas you can pay it at closing out of your proceeds. 

The appraisal (ordered by the buyer’s lender) is to check and see if the house is worth the price they offered. If the appraisal comes back lower than what they offered, the lender will likely NOT give them a loan for the full amount. At this point, you can re-negotiate, or they can choose to pay out of pocket. Most buyers will walk if they have to pay a large amount out of pocket in addition to a down payment. Another note: appraisals for VA loans stick with the house for 6 months. If the appraisal comes back low, you’re stuck with that price until a later date. 

7 Tips To Help You List Your Home As For Sale By Owner

Closing a Home as For Sale By Owner

Closing is the part most first time sellers and buyers are least familiar with, but it is honestly the easiest. All you need is a real estate attorney. If your buyer has an agent, the agent will likely schedule a closing with their closing attorney. If neither of you has an agent, call a real estate attorney and they will take care of all the documentation on both sides. You don’t have to prepare legal paperwork or even show up to the actual closing as the seller. You sign your documents at some point the week before closing and the buyer comes in on an actual day to finish it off. After that, the attorney will distribute all the money. They will pay off your loan, pay any contractors, pay any liens from HOAs or banks, and will wire transfer or send a check to you for the rest. 


If you’ve made it through all of this and still think you have the time and energy for an FSBO, go forth and sell! Be patient as it may take time and you may have to adjust your strategy. But if you close the sale, it will be worth it in the end. 

WANT TO READ MORE?
Check out Should You Use a Realtor or Sell Your Own House: Pros and Cons of Both

7 Tips To Help You List Your Home As For Sale By Owner

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