9 For-Sale-By-Owner Mistakes

By Michele Lerner | December 14, 2010 AAA
9 For-Sale-By-Owner Mistakes

If your goal is to sell your home in spring 2011, you should be prepared for a busy winter, whether or not you choose to sell on your own as a for sale by owner (FSBO) listing. Homeowners need to prepare themselves for a home sale in three ways: physically, emotionally and financially. During the months and weeks leading to your home sale, you will need to work on all three of those areas in order to have a successful closing. Avoiding some of the following mistakes can go a long way toward having a smoother and more rewarding transaction. (For more,see our For Sale By Owner Video.)

IN PICTURES: 6 Tips On Selling Your Home In A Down Market

  1. Failing to Prep Your Home for Sale
    Whether you are selling on your own or with an agent, in order to attract buyers your house must be completely clean, empty of clutter and in the best possible condition. Beware of spending too much to fix up your home, since you may not get all the money back when it sells. Instead, focus on inexpensive improvements such as fresh paint, a weed-free yard, polished door handles and faucets, and clean baseboards and walls. (For more, check out The 5 Biggest Mistakes Home Sellers Make.)

  2. Setting the Price Too High
    Sellers who choose not to work with a real estate agent need to do their own research on what comparable homes in their area are selling for. Look at the most recent sales you can find and also check out the listing prices for other homes on the market that are similar to yours in size, location and condition in order to set a price for your home. Remember, your house will sit on the market longer, costing you time and money, if you set your price too high. The longer it stays on the market, the fewer potential buyers will look at it, since they will assume a "stale" listing will have something wrong with it.

IN PICTURES: Home Renovations That Don't Pay

  1. Skipping a Pre-Sale Home Inspection
    Savvy buyers will have your home inspected and may find issues that require repair. Sellers who have a home inspection before putting their home on the market can get their property ready before a buyer inspection, which saves time and makes your home stand out on the market as ready for move-in. (Learn more in Do You Need A Home Inspection?)

  2. Setting an Appropriate Commission for the Buyer's Real Estate Agent
    Selling your home without an agent doesn't get you completely off the hook for real estate agent commissions unless your buyer is also opting to work without an agent. If you want to attract the attention of buyers who are working with a real estate agent, be sure to offer a typical buyer's agent commission for your area – generally about 2.5-3% of the sales price.

  3. Not Putting Enough Photos on the Internet
    Since nearly all buyers start their home search online, they are used to checking out photos as a preview to actually choosing which properties to see in person. Make sure you have multiple photos with your listings and that the photos showcase your home at its best.

  4. Not Listing Your Home on the MLS
    Plenty of companies work with FSBO sellers and will put your home in the local real estate listing service for a flat fee. For a few hundred dollars (small change when it comes to the value of your home), you can market your property to thousands of buyers. (For more, check out 7 Things To Consider Before Selling Your Own Home.)

  5. Not Making Your Home Available for Visitors
    Selling your home is always a hassle, and FSBO sellers have it even worse, since they don't have a real estate agent to show their home when they are not around. Make sure you are as available as possible to show your home to potential buyers and to real estate agents who are previewing homes for their customers.

  6. Not Being Responsive to Potential Buyers
    FSBO sellers should be sure to respond as quickly as possible to emails and phone calls, since any of them could be from a potential buyer. Remember that buyers are likely to be calling and visiting multiple properties, so if you wait a few days they may have found another home to buy.

  7. Not Making Sure Your Buyers Are Qualified
    Don't take your home off the market until you get proof (a pre-qualification letter) from potential buyers. You lose the momentum of marketing your home and run the risk of a failed closing. (Learn more in Pre-Qualified Vs. Pre-Approved - What's The Difference?)

The Bottom Line
The main goal for most FSBO sellers is to save the commission money that real estate agents earn. Carefully avoiding seller errors can go a long way toward ensuring that a home sells quickly and for a reasonable price while allowing the sellers to keep that commission fee for themselves. (For more, see Cut Commissions With "For Sale By Owner" Sales.)

Find out what happened in financial news this week. Read Water Cooler Finance: Barack Obama Vs. The World.

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