How to sell a house by owner

When you sell your home, it’s natural to want to get the highest return on your investment at the closing table. For that and other reasons, some intrepid homeowners prefer selling their house without a real estate agent or Realtor.

Known as a “for sale by owner” (or FSBO) listing, selling a house without a Realtor requires time, ambition and drive, says Sissy Lappin, a Houston-based real estate broker and author of “Simple And Sold,” a guide for FSBO sellers.

FSBO can lead to huge savings when you eliminate the typical 6 percent commission fee for real estate agents. On a $300,000 home, that could add up to $18,000 in savings, Lappin says. Keep in mind, though, that the seller typically pays the commission not just for their own agent but for the buyer’s agent as well. That means that a FSBO seller will save at least 3 percent by selling without an agent, but may still be on the hook for the other 3 percent if the buyer does have one.

Homeowners who are wondering how to sell a house by owner should understand that it’s a learning process. After all, selling a home isn’t something people do every day. Preparing for what’s ahead will help you net the most money at closing and keep your stress to a minimum.

Here’s a step-by-step guide on how to sell a house by owner.

1. Weigh pros and cons of selling without a Realtor

There are advantages and disadvantages to selling a house without a Realtor. Here are a few things to think about before you get started:

Pros

• Save on commission fees: You’ll keep more of your profits after closing because you won’t have to shell out money for a seller’s agent’s commission fee, which averages 3 percent of the home’s sale price.
• Maintain control: You have no middleman in your dealings with buyers and/or their agents, which can sometimes complicate things. You choose which offers to consider and how to market your home.
• Enjoy a more personal experience: According to the National Association of Realtors’ 2022 Profile of Home Buyers and Sellers, 50 percent of FSBO sellers sold to people they already knew.

Cons

• It’s a lot of work: Selling a home on your own can be overwhelming. You have to do it all — prepping the home for sale, analyzing comps to price it correctly, marketing it to buyers, setting up appointments and showings, fielding offers and negotiating. There’s plenty of paperwork involved, too.
• You could net less money: Selling a house without a Realtor typically leads to a lower sale price, according to NAR data. The median sale price of a FSBO home was $225,000 in 2022, a whopping $120,000 less than the median of $345,000 for agent-assisted sales.
• It means tackling obstacles without pro help: Some possible bumps in the road include non-permitted construction work, issues with the title, requests for repairs and financing issues. A Realtor regularly deals with these problems; going it alone can be a challenge.

2. Set a realistic price

If you price your home too high, you might turn off potential buyers from even taking a look at it, says Debreen Oliva of D.O. Organize in Saratoga Springs, New York. Pricing a home right from the get-go is probably the most important step in the sale process, regardless of whether you sell with or without an agent.

To get a sense of your home’s value, consider hiring a professional real estate appraiser. You’ll pay about $375 to $450 for an appraiser’s services, according to FixR.com, a home services listing website.

You’ll also want to take a look at comps. Essentially, that means looking for similar homes that have recently sold in your area. Find out what those homes sold for and what makes your home different.

You can also use property search websites to find information about recently sold properties. But be careful of relying too heavily on these sites’ estimates of your home’s value, though. The values can be inaccurate and might not take into consideration recently sold homes in your area that are similar in age, condition and size to your listing.

3. Get your home market-ready

When you sell a home by owner, you’ll need to get it in tip-top shape for listing photos and showings. Here are some tips for prepping your home for sale:

• Declutter: “We all have emotional attachment to our homes and the things in them,” Oliva says. “But once you decide to sell it, your house is no longer a home. It’s a product on the market. Spend the time and some money on staging so you make the best impression on potential buyers.” By getting rid of the clutter and junk, you can maximize your money and sell for the highest amount in the shortest amount of time.
• Make it sparkle: A little Windex here and a little Pledge there can bring in more money. If your budget allows, consider hiring a cleaning crew to do a deep clean, Lappin suggests.
• Add curb appeal: First impressions are everything, and your home’s exterior should be immaculate. Pull weeds, add fresh mulch and store toys or bikes out of sight. Add a few pots of colorful flowers on the entryway or porch. A fresh coat of paint to the front door and a new welcome mat are nice finishing touches.
• Hire a professional photographer: Displaying professional photos online is a must to draw buyers in, Lappin says. A real estate photographer can vary in price depending on your location and the size of your home, but expect to spend a few hundred dollars. Some photographers may also provide a virtual tour service to help market your home online.

4. Promote, promote, promote

Selling a house without a Realtor can be tricky when it comes to marketing. Once your photos are done and your price is set, post your home on Facebook, Instagram and other social media sites, Lappin says. More importantly, ask people to share the posts. “And don’t underestimate a great sign in your yard,” she adds. “People drive through neighborhoods they want to live in.”

Additionally, look into listing your home on your area’s local multiple listing service (MLS). The cost for flat-fee MLS listing services varies, but it can be well worth it to make your home visible to more potential buyers.

Finally, schedule an open house and private appointments with potential buyers. Hold the open house during a weekend afternoon. “People like to be under the radar and have no pressure,” Lappin says. An open house provides buyers with the perfect opportunity to see your home up close without the hard sales pitch. Consider printing out listing sheets showing the key details of your home so attendees have something to take with them and a way to get a hold of you to make an offer.

5. Confirm the buyer’s financials

When you receive an offer, you’ll need to confirm whether a buyer can really afford a home. Ask all buyers who make an offer to provide a mortgage preapproval letter, Lappin says. As a seller, you also have the right to call the lender, but Realtors do not, she adds.

Find out how much of a down payment the buyer is offering, what loan program they’re using and how much they’re qualified to borrow from a lender. If a buyer has conditional loan approval, find out what types of conditions they have to meet to secure final approval.

6. Consider using an attorney

You do not necessarily need to hire an attorney to sell a house on your own. However, doing so would be money well spent.

“If you’re going to attempt to sell your home without a Realtor, I would highly suggest engaging a real estate attorney to help you with a purchase and sale contract,” says Mark Cianciulli, an attorney and Realtor at the CREM Group in Los Angeles.

“A real estate attorney can prevent a seller from making mistakes and/or incurring liability,” he says. For example, an attorney can help you evaluate offers, draft closing documents, advise on disclosures and ensure the legal side of the sale runs smoothly.

“If I were selling by myself, I would definitely want an attorney representing me in the sale,” Cianciulli says.

It’s not too late to work with a Realtor

Reconsidering? Selling a house without a pro can be a bigger and more daunting undertaking than many home sellers anticipate. Some people just don’t have the time, patience or organizational skills to sell their own house, says Adam Upchurch, owner/Realtor at Marvel Real Estate in Wilmington, North Carolina.

Upchurch says many clients have come to him for help after trying to sell their house on their own and running into obstacles. “They have a life. They have jobs and kids, and they can’t approve every appointment or grab the dogs to get them out of the house for a showing,” he says.

If you do decide to hire a real estate agent, find someone who has several years of experience listing homes in your area, as well as solid referrals from past clients. Keep in mind that while real estate commissions are negotiable, a listing agent typically splits the commission fee down the middle with a buyer’s agent.