Thinking of selling your house without a real estate agent? You aren’t alone. Last year, 7% of homes sold in the United States were FSBO – For Sale By Owner. So the good news is you can definitely do it and there are a number of resources out there that can help you. However, it’s important to be aware of the potential risks involved in selling your house yourself. If you want to know how to sell your house without an agent, follow these three simple steps.
Step One: Acknowledge the Risks of Selling Your House without a Real Estate Agent
Selling property without a real estate agent is extremely risky. There are a number of pitfalls that can torpedo even the most organized and intelligent homeowner. (We’ve written more at length about them). The most obvious detriment of selling your house without an agent is that you won’t have someone with experience guiding you through the process, for whatever unknowns you may encounter. Every mistake usually ends up costing you time and money. Without years of experience in the local market, you could end up pricing your home too low or too high. Not having an agent also means that you’ll be responsible for all of the marketing of your home to buyers, which can be expensive and eat up all your time. Finally, if there are any problems with the sale, you won’t have anyone to help negotiate on your behalf.
Before you proceed down the FSBO road, it’s imperative you acknowledge all those risks. Do some additional research, talk to someone else who has sold (or attempted to sell) property without an agent. These aren’t just horror stories; they’re very real possibilities you may face. Once you determine the likelihood of one of these happening to you, and the potential fallout from such, you can move to the next step.
Step Two: Calculate the Benefits of Selling Your House without an Agent
The extremely technical term for the next step is determining “if the juice is worth the squeeze.” Meaning, you should try to estimate exactly how much you stand to gain, then compare it to the previously identified risk. If the financial benefits greatly outweigh the potential for disaster, then FSBO may indeed be the best option for your home sale.
The single biggest benefit of selling your house without an agent is that you can save money on commissions. Usually the aggregate commission is around 5% of the purchase price, with that amount being split between the seller’s agent and the buyer’s agent. So a FSBO sale could save you 2.5% of the final price – clearly a significant amount of cash! Of course, this assumes you can source a buyer with an offer that is as high as what a listing agent could bring to the table; something most novices struggle to do. Another (potential) benefit is that you will have complete control over the sale of your home and can move at whatever speed you want, breakneck pace or methodically unhurried. Finally, selling your home without an agent gives you the opportunity to meet potential buyers and get their feedback directly so that you can adjust your marketing strategy accordingly.
Try to calculate exactly how much you can benefit from these differences, and turn it into a quantifiable number. That way you can (at least try to) make an apples to apples comparison with the risk potential. Remember, if you are foregoing the assistance of real estate agents, you may need to pay a real estate attorney to help you through the selling process. You will also need to navigate the closing costs on your own.
Step Three: Move Quickly with Tripwires in Place
Once you’ve completed your research and assessment, and decided FSBO is the right option, it’s time to execute. You must act swiftly and decisively.
When your home is on the market (even if it is not on the MLS: Multiple Listing Service), the clock is ticking. A home that has been stagnant for months is a major red flag to potential buyers. Same goes if you’ve had to reduce your listing price multiple times. That can absolutely undermine the final sale price of all real estate transactions. You must also be prepared to spend money to find suitable buyers. A robust marketing budget is always much higher than what amateur FSBO sellers suspect it must be. Additionally, proper research into which channels to promote your home is imperative. Of course, you should also have proficiency with title and escrow services, so you can protect a potential sale from falling through after agreeing terms.
None of these are small tasks, so the optimal strategy is to place some tripwires in your process to ensure the benefits of FSBO don’t evaporate without you even noticing. Give yourself deadlines and objective targets. You must find X number of offers above $Y amount within Z number of days. Establish these figures before you start your process, so you aren’t influenced by your emotional state in the thick of the journey. Should you fail to hit these predetermined targets, there’s no shame in pivoting the plan to hire a listing agent. We built TrueParity so homeowners can quickly find the best listing agent; it’s always smart to leverage technology and have a couple potential agents waiting in the wings, should you need. With any home sale, FSBO or not, you should always expect the unexpected.
Conclusion
Selling your house without an agent is certainly possible—but it’s not for everyone. Be sure to do plenty of research before making a decision; assess all the potential risks and calculate the expected benefits to see if it’s worth it for you. If you move forward with an FSBO sale, execute your plan quickly with some failsafes to keep you on track. Even if you’re going it alone, you should always utilize every resource at your disposal throughout the entire process to make sure you have a backup plan. Most real estate agents would be happy to quickly mobile to aid you in your home sale.
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