real estate

Selling FSBO isn't simple

Steve McLindenQuestionDear Real Estate Adviser,
We live in southern Missouri and have an opportunity to buy a very nice property, but we need to sell our home first to do so. We would like to do that on our own. Are there resources where we could find information on selling by owners, plus forms and contracts, et cetera?
-- Donna O.

AnswerDear Donna,
Goodness yes! There are almost limitless Internet resources out there for prospective for-sale-by-owner, or FSBO, sellers, offering marketing tips, advertising packages, blank real estate contracts, yard signs, brochure-production and varied products and services. Among the throng of websites, in no particular order, are: ForSaleByOwner.com, FSBOSellBuy.com, HomesByOwner.com, Owners.com, ByOwner.com and sell-your-home-fsbo.com. Their costs start as low as $50, though you'll be paying quite a bit more if you want your home listed on the MLS, or multiple listing service, which is the prime go-to listing tool for agents, buyers and sellers.

Though the idea of a FSBO sale might sound simple, it can be a real beat down if you're not prudent. I've seen numerous FSBO deals come off without a hitch while others turn into nightmares or exercises in futility. Sellers and buyers juggle numerous obligations in a real estate deal, and there are tons of things that can go askew if one little deal-point or requirement falls apart.

Most FSBO sellers, to be frank, lack the market knowledge to accurately price a home. The first couple of weeks on the market are the most crucial because that's when buyer interest is keenest, so you can't afford to price your house too high from the get-go or you'll likely lose your edge. Research the list prices of other FSBO homes that are in and around your area and compare their list prices with their publically accessible appraisal (taxing) value to get an idea of how to price yours.

The more protections that are built into your sales contract, the better. That's why you could benefit from some help, be it a real estate attorney or an agent who can help walk you through the deal for a fee. For example, agents advertising, "For Sale By Owner -- Assist," will welcome your call.

But since you are buying land in the second part of your grand plan, I strongly suggest you bring in an expert to make sure the property you want has all the accommodations, utility access and infrastructure you expect to build and support the kind of home you envision.

A few other tips and tidbits: Make sure you take, or have someone take, crisp, clear photos that flatter the property. Declutter your house, box up most keepsakes and consider storing some of your furnishings if there's an excess. Buyers want to be able to envision themselves and their stuff in your space. If possible, ask a friend or associate to examine your home from an outsider's point of view and tell you what they see and what they'd like to see. But don't kill the messenger! Also, be flexible with showings -- it is the "Show-Me State," after all -- and solicit feedback from would-be buyers. When a serious buyer emerges, find out if he or she has been prequalified by a lender to make the purchase. That's key, because the inability to obtain a mortgage is among the most common cause of deals going south. Know that closing fees will amount to about 1 percent to 1.5 percent of the home's sale price.

Lastly, realize that a seller's market is the optimal time to sell FSBOs and this isn't one of those, at least in most places. But that doesn't mean you won't have success. Good luck!

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