FSBO Matrix - How to Sell a Home by Yourself

By Brandon Cornett, Editor
© 2014 All rights reserved

If you want to know how to sell your home by yourself, you've come to the right place. In this article, you'll learn how to conduct a successful FSBO campaign to sell your own home.

Selling your house by yourself is not as complicated as you might think. It just requires a lot of preparation and planning. By the time you're done reading this lesson, you'll know how to FSBO your home successfully.

Sell Your Home Yourself - By the Numbers

If you're comfortable with the FSBO steps listed above, then you can sell your home by yourself -- and save a lot of money in the process. We will talk about your potential savings later on. But first, let's discuss each of the items in the FSBO matrix:

Step 1 - Determine the asking price.

Real estate agents want you to think that home pricing is difficult. After all, if you feel intimidated by the process, you're more likely to hire an agent. Here's the truth of the matter. Coming up with an asking price is fairly straightforward. You would start by finding out what comparable homes are selling for in your area. Next, you would adjust your price up or down, based on any extra features you have, or features that you lack. A house is worth whatever people are willing to pay for it. Period. It doesn't get any more complicated than that. You need to find out what people have been paying in your area.

Here's the big "secret" of real estate pricing. Buyer agents will use this same data to justify their clients' offers. They will look at comparable sales in the area (or comps), to determine whether or not your asking price is realistic. If you've based your price on the same market data, you'll be in line with their expectations. Make sense, right? Keep this concept in mind when you conduct your FSBO campaign, and you'll be off to a great start. 

If you want to know how to sell your home by yourself, you must understand the three P's of success. Preparation, pricing and promoting. You must prepare your house for the market, with home staging and repairs. Then you must price it well using recent market data. Finally, you need to promote it to the largest possible audience. But of all the three P's, pricing is the most important. If you want to have a successful FSBO experience, you need to price it right. Nothing else will matter if you ask too much money, because buyers won't even visit.

You can find the price of recently sold homes in your neighborhood on websites like Zillow.com and Trulia.com.

In addition to doing your own research, you can also have the home professionally appraised. This can be a wise investment when you're selling the home by yourself. You can expect to pay anywhere from $300 - $500 for an appraisal. A licensed home appraiser will perform much of the research we discussed earlier. He will also come and visit your home inside and out, to help determine what it's worth. When it's all said and done, you'll have an appraisal report that you can use to establish your asking price.

If you want to sell your home by yourself, I highly recommend having it appraised first. At the very least, you should get a pricing report from an FSBO service. Several of the big FSBO websites offer pricing tools to help you set your asking price.

Related articles for this section:

• Pricing your home for the market

Let's move on to talk about another step in the process that you can do for yourself. Let's talk about listing photos.

Step 2 - Stage the home and take pictures.

Do you own a digital camera, or know someone who does? If so, you can take your own photos to put on the Multiple Listing Service (MLS) and Realtor.com. Here's an FSBO seller's guide to listing photos:

The first thing you need to do is de-clutter your home. Clear the shelves and mantles of any "knickknacks" that might be there, leaving only one or two decorative items. Remove any excess furniture that might be overcrowding the rooms. Tidy up the lawn, if you have one. Follow the advice in our staging guide. Turn all of the lights on, and open the curtains or blinds. Now you're ready to take pictures!

If you want to see what good staging looks like, check on this case study on how to sell a house fast. Actually, the entire article is worth a read. It's a real-world example of home-selling success.

Let's move on to discuss another important topic for FSBO sellers. Let's talk about marketing the property.

Step 3 - List the home on the MLS and Realtor.com.

Thus far, our lesson on how to sell your home by yourself has focused on pricing and preparation. Now you're ready to move forward. You're ready to show your house to the world -- a world of potential buyers, at least. There are dozens of ways to market a home that's for sale. The key is to put the house in front of as many buyers as possible, in the last amount of time. There are two ways to do this. You need to list it on the Multiple Listing Service (MLS) and Realtor.com. We will talk about the MLS first.

Even as an FSBO, you can have your home listed on the MLS. You don't need an agent to do this. I'll repeat that, because it's a common misconception. You can list your house on the Multiple Listing Service without using a real estate agent. There are several For Sale by Owner websites that allow you to do this.

If you want to sell your home by yourself, you need to market it to two audiences -- home buyers and their agents. Getting your house on the MLS will put it in front of every agent in the town, practically overnight.

You can also gain a lot of visibility by marketing the home on Realtor.com. This website has the largest audience of home buyers, so it's definitely worth using. Many of the big FSBO websites will help you list on Realtor.com as well, in addition to the MLS.

Step 4 - Put a sign in your yard.

There's much to say about this topic, but it does need to be included. Putting a "for sale" sign in the yard helps people find the home. That much is obvious. But it also helps you capitalize on drive-by shoppers weren't necessarily looking for your house. In other words, it allows people to "stumble across" your listing.

Putting a sign in the yard will also alert the neighbors to your pending move. One of your neighbors might know somebody who wants to buy in your neighborhood. All of these things can help you sell your home by yourself.

Step 5 - Create a marketing flyer or "one sheet."

This is an optional step, but I recommend doing it. The point here is to tell people about everything that makes your house special. Don't assume that they'll see these things for themselves. Tell them!

Sit down and think about your home, from top to bottom. What features do you like most? What have you done to the house since you bought it? What about the neighborhood and surrounding area? Are there a lot of amenities close by, such as parks and restaurants? Put it on the list. Include the price / value of the upgrades, whenever possible. This kind of information can help you sell your home faster, whether you're selling it by yourself or with an agent.

You should be able to squeeze it all onto a single page. Don't sweat the design. It can be a simple list on paper. You don't need anything fancy, as long as it's readable and neat. You can create a nice flyer or "one sheet" using Microsoft Word.

Here's an example (PDF file) of a flyer I made, when I sold my last home. Buyers might not have noticed many of the items on this list. So I directed their attention where I wanted it most. That's the whole point of providing one. I had a stack of these on a small table by the front door. That way, they could scan the information upon arrival, and see the actual items as they walked through the house. Every FSBO strategy should include a one sheet.

Step 6 - Review the buyer's offer.

When the buyers makes an offer to purchase your home, they will use a standardized form that's required for your state (and possibly your county). You should be able to find sample forms for your state by doing a Google search. Most state licensing and regulatory boards will offer these forms for download. For example, when I lived in Texas I found everything I needed on the Texas Real Estate Commission website.

How does this help you sell your home by yourself? In a word -- familiarity. If you get familiar with the standard purchase agreement forms that are used in your area, you'll have a much easier time deciphering the buyer's offer.

Most offers come with a good deal of "boilerplate" information. This information is the same from one contract to the next. You're most concerned with the unique items that are filled in by the buyer. These include:

• The purchase price
• The amount of earnest money
• The escrow period
• Contingencies, such as home inspection and financing

When you review the buyer's offer, consider their financial picture as well. You want to make sure they've been pre-approved by a lender, first and foremost.

Next, consider the amount they are offering. Are they offering the full asking price, or below? The buyer's offer will largely be driven by the market. In a buyer's market, they'll probably aim lower than your asking price. In a seller's market, they may offer the full asking price or more. So your job, as an FSBO seller, is to understand the kind of market you're in. If you're showing the house frequently and you have multiple offers coming in, you can be more comfortable in your leverage ability. If you've only had one offer in a month or more, you have less leverage. It's all about the market!

When you try to sell your home by yourself, you need to put your emotions aside. This can be hard to do. As the homeowner, you're inclined to take a low offer as an insult. But it's not an insult. It's just a home buyer trying to get a good value for their money. It's all business. So don't be insulted by a lower offer, especially if it's the only offer you have. Consider it carefully.  

The decision to accept or reject an offer is yours and yours alone. The best you can do is price the home well from the start, and research your local real estate trends. This kind of research will allow you to make smarter decisions.

Step 7 - Negotiate with buyers.

As a general rule, you should almost always counter an offer that's unacceptable to you. Why? Because you have nothing to lose by making a counteroffer. Countering could bring you one step closer to an acceptable offer.

For example, let's say I've listed my home for $275,000. I'm selling my home by myself, so I do plenty of market and pricing research. I've determined that 275K is a reasonable and realistic price. Eventually, a buyer offers to purchase the home for $255,000. I've been showing the house two or three times a day, and getting some positive feedback. So I am certainly not desperate at this point. I'm comfortable in my negotiating leverage. I counter with an offer of $270,000. If the buyers agree to this, I've got an offer for 98% of my asking price -- and that's pretty darn good. If the buyers refuse, then I'll keep showing the property.

Of course, if I can't get anyone to pay $275,000 after several more offers, I should probably consider lowering the price. Or maybe I'll improve my curb appeal and home staging first, to see if that brings in a better offer.

The point is that you need to be flexible and willing to work with buyers. If you're willing to bend a little, your FSBO process will be much easier. This is the key to success when you sell your home by yourself, especially in a slow market.

Step 8 - Accept the best offer.

We discussed the offer and negotiation process above. Accepting an offer is a straightforward part of the FSBO process. You will simply sign and initial the purchase agreement in several places. The buyer's agent will present this document to you. The agent might bring it by in person, or send you an electronic version of the document. It varies from state to state. The important thing here is to review all of the key items carefully (price, contingencies, etc.), to make sure you agree to them.  

Step 9 - Prepare for closing.

When you sell your house by yourself, you'll have to stay in touch with the title / escrow company. These are the people who prepare all of the documents for the closing process. They will probably contact you to request certain items from you. If you were selling with the help of an agent, the title would contact your agent ... and he or she would then contact you. So the only difference when you sell the home FSBO style is that the title company contacts you directly. All you have to do is provide whatever documents they need, and find out when and where the closing will take place. That's about all there is to it.

FSBO Websites

FSBO websites have come a long way over the years. Today, there are several websites that offer an impressive array of products and services. They can help you price the home, put it on the MLS, list it on Realtor.com and more. Some FSBO websites / services even provide consultations by phone and email. Of course, you have to choose an upgraded FSBO package to get this kind of one-on-one help. But it's still a lot cheaper than using an agent.

Here are some FSBO websites you might want to look into:

• ForSaleByOwner.com
• Owners.com
• FSBO.com
• HomesByOwner.com

This concludes our lesson on how to sell your home by yourself, FSBO style. I hope you found this lesson helpful, and I wish you all the best in your future sale.last