When you’re getting ready to sell your home you have a lot of choices to make. When to list and sell, where you want to move to, and how much money you hope to make. If you’re a “do-it-yourself” type, you might be considering another choice — selling your house without a Realtor®.
For most sellers, saving on real estate agent commission fees is the biggest appeal to selling by owner. But before you make the decision based on money alone, make sure you have a good grasp of the process and the amount of work involved.
If you are trying to sell your house in Harford County, MD and surrounding areas for sale by owner, or FSBO, you need to learn all the moving pieces that go into a move, which is why we’re going to break them down for you.
Your three main options to sell a house without a Realtor® include:
Sell to a cash buyer
Hire a real estate attorney to facilitate a sale to a known buyer
Handle the sale yourself via For Sale By Owner (FSBO)
We’re going to identify the pros and cons of each option, and give you some basic steps to follow if you decide to sell your house without a Realtor®.
Option 1: Sell your house to a cash buyer
If you need a fast sale, consider selling your house for cash. Cash buyers — including iBuyers and house buying companies — are individuals or entities that purchase your home outright, without the need for lender financing. Cash buyers offer sellers convenience and a quick sale, but often at the cost of a higher transaction fee and lower net profit.
Pros:
You can sometimes avoid home inspection delays
Inspection issues account for 16% of closing delays, according to the National Association of Realtors. If you sell your home “as is” to a cash buyer, they may not require you to complete any needed repairs the home inspection found. Some cash buyers could waive a home inspection entirely.
You don’t need to deal with the stress of an open house and home showings
Put away the cleaning supplies and don’t worry about tidying up. With a cash sale, nobody is coming for a showing at a moment’s notice. Imagine how much time you’ll save out of your already busy week if you don’t have to make your kids and pets disappear for an hour!
You can skip the home makeover
Again, because this is an as-is situation, you won’t need to climb up on the roof or repaint rooms or obtain estimates from contractors. You can also skip cosmetic upgrades normally needed to increase your home’s marketability and attract buyers. Forget about decluttering, staging, painting, and updating hardware and fixtures.
This might be a good option for some sellers.
Cons:
The sale price is often lower than you want
As hinted at earlier, convenience comes with a cost. Many cash buyers use a seller’s desire for convenience to leverage a lower price.
Because many cash buyers are flippers or investors, they don’t want to pay market prices. They prefer to take a “how low will you go” mentality when making an offer on your home. They plan on spending money on the house after they purchase it — fixing it up for a quick flip and as large a profit as possible. Plus, they know that some sellers are willing to sacrifice money in exchange for speed and convenience.
Sometimes cash buyer is the best route seller can choose though. Sell Your Home Without Repairs, Staging, or Showings Easy Outs Homes provides you a competitive all-cash offer to buy your home, on your timeline Request Offer
Not all cash buyers created equal
If you want to sell your house for cash, ensure you’re selling your home for the most money possible and getting easy sale with Easy Outs Homes. Fill out basic information about your home and location, and we’ll provide a cash offer to buy your home.
In addition, Easy Outs Homes provides you with a side-by-side comparison of what you might typically make selling your house on the open market with the help of a local top agent in Harford County, MD and surrounding areas.
Option 2: Sell your house to someone you know with the help of a real estate attorney
If you’re lucky enough to have a buyer waiting in the wings, consider selling your house without a Realtor®. Instead, hire a real estate attorney to help you close the sale.
Attorneys specialized in real estate transactions can help draft and interpret the endless stack of closing paperwork, including contracts and legal documents.
Pros:
A real estate attorney can craft an air-tight contract
Your attorney will draw up contracts that include deadlines for inspections and appraisals, any conditions, caveats and contingencies, and the details of the sale price and closing dates.
You have a legal advisor to resolve disputes
Having an attorney help you with the process can be valuable, especially if problems develop. They can step in to help resolve disputes or prevent them from even occurring.
Common disputes include failure to disclose property defects and the inability to agree on a moving date.
Cons:
An attorney won’t get you the best deal possible on your home sale
An attorney will help you close your home sale without running into legal issues, but they won’t help you sell your home for the best price possible. If you’re determined to work with one buyer, the attorney can’t really negotiate on price. For that, you need a top real estate agent.
Attorneys, unlike agents, will not showcase or advertise a seller’s house, which draws a large pool of potential buyers. Agents also may know the market and help sellers with determining a sales price.
Agents are experts in crafting effective pricing strategies and negotiating the best price possible for your home. If you go without an agent, you could undersell your home — especially if it’s to someone you know, where personal feelings are in the mix.
Option 3. Sell your home on the open market without a real estate agent (FSBO)
Sellers are often drawn to FSBO because they want to save on agent commission costs and control the entire process. However, with added control comes added responsibility. You’ll need to advertise and market the listing, price it accordingly, and host walk-throughs and open houses.
Few homeowners are willing to take on these tasks and risk selling their homes for less. In 2020, the National Association of Realtors shared that FSBO sales accounted for only 7% of home sales. But if you’re savvy at marketing, home design, networking, and negotiating, you may just pull it off.
Pros:
You save on real estate agent commission fees
If you sell your home yourself, you keep the 3% commission fee that normally goes to the listing agent. However, note that you may still need to cover your buyer’s agent commission fees, typically 3% of the home sale.
You can still list your home on the MLS
You can advertise your home listing in Facebook groups, Nextdoor, other online neighborhood sites, or on your personal Facebook page. But to reach the widest homebuying audience possible, you’ll want to list your home on the real estate industry’s multiple listing service (MLS), where 9 in 10 sellers listed their homes.
FSBO homes can sell faster
Because it’s not an arm’s-length transaction, sometimes FSBO homes can sell and close faster than a sale in the open market. In 2020, 77% of FSBO homes sold in under 2 weeks. These sales closed quickly because the sellers often sold their homes to individuals they already knew, according to the National Association of Realtors.
Cons:
Statistically, you’re likely to sell your house for less money than if you hired a Realtor®
Real estate agents sell homes for 6% more than FSBO sellers do, according to Collateral Analytics. And according to the National Association of Realtors, the typical FSBO home sold for $260,000 compared to the $318,000 that agent-assisted homes sold for in 2020.
There are many reasons why FSBO homes usually sell for less:
Buyer’s agents out-negotiate FSBO sellers.
FSBO sellers often miss the mark in setting a competitive listing price. When they price their homes too low, they lose money. When they price their homes too high, their home sits on the market, leading to a lower final selling price.
A home inspection report could reveal issues that the seller struggles to address efficiently. They may agree to have too many repairs done and lose money in their home sale. Or they may push back too hard and the buyer leaves the deal.
FSBO is time consuming: You’re in charge of marketing and communications
If you’re planning to act as your own agent, it will feel like a part-time job. The seller must market their home with social media, flyers, and open houses.
As a seller without an agent, you also must be available days, nights, and weekends to promptly respond to inquiries. If you fail to return an email or phone call quickly, you could lose the buyer who finds another home in the meantime.
Photos and staging are your responsibility
You’ll need to hire a professional photographer to take shots of your home’s interior and exterior. The average cost ranges between $110 and $300, and plan on spending several hours ahead of time picking up. Professional photos won’t compensate for a home that’s cluttered or poorly staged.
Your personal safety may be at risk
You might not know what kind of people going through your house. An agent will not only host walk-throughs but also vet potential buyers to keep you and your home safe, verifying that they’re legitimate, pre-approved buyers.
Realtor® is licensed, has a code of ethics, uses a lockbox, the showing is pre-scheduled and stays with clients during the showing. If you decide to sell FSBO, you’re opening the door of your house to strangers.
You could be scammed
FSBO sellers also need to watch out for wire fraud and online-phishing scams.
Wire fraud is when sellers receive an email from a title company that looks legitimate, but contains fake wiring instructions that actually sends the money to a scammer’s account. Once it’s gone, you typically can’t get it back.
Some scammers will claim that they want to buy your house but can’t come see it in person. They’ll offer to send a money order as a deposit. A few days later, they’ll ask for their money back. After you send the refund, your bank discovers the money order was fraudulent and, again, you typically can’t get your money back.
You have to handle negotiations yourself
Agents are skilled negotiators focused on getting the best deal for their clients. The buyer’s agent isn’t looking out for your interests — and could try to take advantage of your inexperience during negotiations. They could ask for non-standard contingencies or timelines.
Are you comfortable pushing back on requests, and do you know what’s normal in the market? Can you handle the back and forth of negotiations and remain calm, keeping the deal intact but still getting what you need? Before you decide to sell by owner, be honest with yourself about your strengths as a negotiator because it’s a key part of the deal.
What is the top mistake FSBO sellers make?
Not putting the price on the listing! Believe it or not, some FSBO sellers think that failing to disclose the list price in private advertisements will increase interest. The reverse is true — most buyers feel uncomfortable calling and asking directly, and may worry that you’ll overprice the home. Being upfront increases their confidence in you and the transaction.
Bottom line — Weigh the benefits and understand the trade-offs
If you decide to sell without a Realtor® you’ll be wearing many hats — scheduler, marketer, legal expert, and more. It is a full-time job, which is why most real estate agents do it full time.
If you decide to sell with a Realtor®, go here to find the best agent to sell your home.
If you decide you want an easy sale - sell to a cash buyer.
