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for sale by owner?

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Repeat the Line
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11:40p, 7/8/19
for those here that have sold their home without an agent, what tips can you recommend?
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TXTransplant
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6:41a, 7/9/19
I did it a few years ago in College Station. The neighborhood I was in worked in my favor, as there were still new builds, so there was a lot of drive-through traffic. I also had a very desirable house, in a desirable location, at a hot price point (there were buyers who were interested solely because of who built the house). Otherwise, not being on the MLS would have been an issue.

The things to know - every realtor in town is going to know your house is for sale (because they are going to send you notes, cards, and letters in the mail offering to list your house for you), but they are not going to bring buyers to see your house. I think I got one call from a realtor (and they called on their own behalf). All the other calls I got were from the buyers themselves (some of whom had agents).

You need to put in your listing that you are willing to pay the buyers agent's commission. We can go back and forth until the cows come home about this (and I have some pretty strong opinions), but the bottom line is, if you want a buyer, you need to be willing to pay the buyer's agent. If you luck up and have an agent-free transaction, great, but don't count on it. In the current system, I can't understand why a buyer wouldn't use a buyer's agent.

I listed my home with the maximum pictures I could post on every free site I could find, but Zillow was the one that generated the most interest (other than the sign in my yard). I also attached a box to the sign and put fliers in it.

I was in a very tight financial position, which is why I did FSBO. I was also purchasing (in another town) at the same time, and my buyer's agent for that transaction did help me a little with the FSBO.

However, under different circumstances, I would have hired a flat-fee listing agent, if for no other reason than to get the house on the MLS. This is particularly important if you are in a bigger market area with a good MLS (like the Houston area/HAR).

My final words of advice are to be patient. You're going to get a lot of calls from people who just want to "look" and from people who want to do owner financing, so be prepared to have responses for both.
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mazag08
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9:01a, 7/9/19
AG
Great post TxTransplant.

I would just say to know what your house is worth. It doesn't take much effort to look up similar size, location, and style homes on the market and at the very least what their asking price is.
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Red Pear Realty
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9:52a, 7/9/19
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AG
Know your true market value. Most FSBO's that I see don't know the true value of their home. They either over price it so it sits there forever (so the seller is losing money via ownership expenses and opportunity cost), or they under price it and lose a nickel while saving a penny (and I imagine they brag to friends and family about how easy it was and about how much money they saved).

Get professional photos if you are going to put it online.

I usually generate about 75% of my clicks via the MLS, 20% of my clicks via Zillow, and 5% through the various other sites. Zillow and some of the others are free to post. Offer 3% to buyer's agents and you'll get showings.

If you want to list it, we'd be happy to help you for a flat fee.
Sponsor Message: We Split Commissions. Full Service Agents in Austin, Bryan-College Station, Dallas-Fort Worth, Houston and San Antonio. Red Pear Realty
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HumpitPuryear
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10:19a, 7/9/19
AG
Definitely need to offer the buyers agent commission. I sold my house in Round Rock this way and the majority of my interest came from buyer's agents. If you aren't offering that commission they aren't going to call you.

Make sure you are pricing the house appropriately. Be honest with yourself about the value of the house and have some agents look at it and give you pointers on what you need to repair and how to price it.

I would also suggest getting a burner phone and using that in your ad. Agents will drive you nuts for the next 3 years calling about your house and have you sold it? Let us put our proven system to work for you yada yada. I was still getting phone calls from agents and real estate service companies 2-3 years after my house was sold and I deleted all of my ads. I'm not sure how this happens. I'm assuming some company scans all of the ads for FSBO and puts them into a database and sells that database as a lead source to agents. It's infuriating.
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SteveBott
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10:58a, 7/9/19
AG
Use flat fee listing agent. 700-1500 cost upfront
3% buyer agent commission

Now what really matters is your market conditions. If it's on fire buyers and agents are literally driving street to street. If a normal market above works. A buyers market? Not many around but if so full service is needed.
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DallasAggie0
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3:55p, 7/9/19
Would agents really balk at 2% as opposed to 3%?
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TXTransplant
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In reply to DallasAggie0 • 4:19p, 7/9/19
In my experience, yes. The buyers who ultimately purchased my home kept trying to lowball me. Their agent tried to tell me that I was "saving so much money by not having to pay a seller's agent", but she hadn't bothered to do her homework on what the house was worth. They thought I was desperate (I wasn't).

I laughed at the first lowball offer, and told her I wouldn't accept anything lower than $X (I was prepared to wait things out and had a couple of other prospective buyers who came along after the contract was signed). She came back with a second offer that was still less than my $X, which I also declined. But not before saying I'd be willing to accept the second offer if she'd reduce her commission. She gasped in horror at the suggestion and said "Oh, no, I can't do that!"

She called me back a couple of days later with an offer at the number I gave her after rejecting the first offer.

Obviously, it depends on the agent (and it helped that these buyers REALLY wanted my house), but in a buyer's market, I could see an agent steering the buyers in another direction of there is any doubt they will earn 3%.
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jja79
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5:05p, 7/9/19
AG
Steve might weigh in here but in my experience I seem to see a disproportionate number of appraisals higher than sales price when the seller is FSBO. I think sometimes FSBO sellers leave money on the table.
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SteveBott
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5:10p, 7/9/19
AG
I dont get very many anymore but yes there is risk of poor pricing. both ways if both sides are on their own.

As for 2% vs 3% again I point to market conditions. In a real hot or cold market you could see some flexibility. Hot they dont have inventory to sell and may just get what they can
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Bob_Ag
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In reply to Repeat the Line • 6:09p, 7/9/19
AG
Adorable Mason Reeves said:
for those here that have sold their home without an agent, what tips can you recommend?
What's your market? I do appraisals all over Austin and sale to list price ratio is always between 98-100% for specified regions.

It's not that difficult to figure out without sold comps if you have a good amount of volume to go off of.

Get on Realtor.com or Zillow and look at the list prices for homes that are on the market less than 90 days. Price yourself somewhere around there. Since you are saving 3%, you have some flexibility in the pricing. Around here, anything selling over 90 days (aside from new construction) is either priced too high or has something else going on.

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SteveBott
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6:19p, 7/9/19
AG
I know I'm a broken record but it's all about market conditions as to what your option are. I live in Round Rock and two years ago I could just put a sign in the yard. Now I'd at least start with a flat fee listing and pay 3% buyer agent fee.

We have slowed down considerably since then,
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Diggity
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In reply to SteveBott • 11:27p, 7/9/19
AG
My market areas have gotten very slow as well.
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Lone Stranger
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1:53p, 7/13/19
I've done FSBO in hot sellers markets and been happy and used a realtor in buyers markets and been happy. All good advice here. Something nobody has mentioned; go to one of your local title companies and get the "packet" of instructions and document listings that will help you understand all the paperwork and details you will have to handle if you FSBO. I've seen people look at it and decide their time if more valuable elsewhere and get a realtor and others that said "that's all there is too it...full speed ahead".

There are great realtors and there are absolute idiots so just like everything buyer beware and do your homework. When I moved to BCS 35 years ago we called a local realtor shop with a national affiliation to ask about some general community and market info. The letter I got back from them was absolutely the worst typed out, poor grammar, incoherent piece of trash I've ever received in a business setting. I still keep it in my file of jokes, comedy and WTF's just to get a laugh sometimes.

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dubi
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In reply to SteveBott • 8:09a, 7/18/19
AG
College Station is slow too.

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dallasiteinsa02
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In reply to TXTransplant • 8:35a, 7/18/19
TXTransplant said:
Their agent tried to tell me that I was "saving so much money by not having to pay a seller's agent"

I am a realtor and have bought tons of properties for myself. This is a favorite line that I get as well. I shouldn't have to pay 3% higher for a property because I am representing myself.
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TXTransplant
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In reply to dallasiteinsa02 • 10:24a, 7/18/19
dallasiteinsa02 said:
TXTransplant said:
Their agent tried to tell me that I was "saving so much money by not having to pay a seller's agent"

I am a realtor and have bought tons of properties for myself. This is a favorite line that I get as well. I shouldn't have to pay 3% higher for a property because I am representing myself.


Here is my issue - appraisals and comps don't take into account realtor fees because those are rolled into the final price of the house.

If comps and/or an appraisal indicate a house is worth $250k, and the owner elects to sell FSBO for $250k, then I don't think any buyer should expect a "discount".

A smart FSBO seller knows what the home is worth and is opting to pocket (or not lose, if the house hasn't appreciated much) the 3% (or 6%, if the seller is refusing to pay a buyers' agent - which FTR, is not a smart idea).

The next closest scenario to this is the "flat fee" listing. Buyers/buyers' agents shouldn't be presenting offers with the statement "I see you're listed with a flat fee agent and we know you aren't paying them 3%, so we expect to get the house for 3% less."

If you want to offer lower than asking, fine. Just don't try to justify it with the statement "We know you're saving on realtor fees, so you should be willing to accept a lowball offer."

The idea behind FSBO and flat-fee listings is to maximize how much the seller earns (or minimize how much he loses) on the sale - not for the buyer to get a "discount" on the price of the home relative to recently sold comps. Of course, this is all assuming the house is priced in-line with comps and/or the appraisal.
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Bob_Ag
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In reply to TXTransplant • 12:26p, 7/18/19
AG
Quote:
If comps and/or an appraisal indicate a house is worth $250k, and the owner elects to sell FSBO for $250k, then I don't think any buyer should expect a "discount".
Exactly. Market value is market value and its illogical to expect someone to price their home below it just because they forego agency.
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DallasAggie0
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12:48p, 7/18/19
They should expect a discount unless the seller is not offering any BAC.

Seller offers 3%, buyer has no representation meaning no commission seller would have to pay so there should be a discount there. And I am talking about final sales price not list price.
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TXTransplant
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In reply to DallasAggie0 • 1:11p, 7/18/19
DallasAggie0 said:
They should expect a discount unless the seller is not offering any BAC.

Seller offers 3%, buyer has no representation meaning no commission seller would have to pay so there should be a discount there. And I am talking about final sales price not list price.


Yes, if the buyer is also not represented and the seller was planning to pay the buyer's agent, then a reduction in price would make sense.

But, assuming the seller plans to pay the buyer's agent, the buyer shouldn't also be expecting a discount to account for the fact that there is no seller's agent. Or, if they are, the buyer's agent shouldn't actually tell the sellers that.
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DallasAggie0
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1:30p, 7/18/19
I can see the argument, as the market currently has 6% baked in. But yea I agree with you, seller can do what they want on their side.

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francine
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12:34a, 7/22/19
If you are selling without an agent, then prepare your home well for more showings. Focus on curb appeal, conduct a home inspection, repair all the damages. Thereafter, list your home. For the advertisement, you can take help of different websites. These tips will help you with a faster sale.





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