Ready to sell your home By Owner? This is the blog post for you. I’ll cover three tips in this post, plus even more in my podcast here: Fox Valley Property – Podcast – 5 Tips to Sell By Owner
Maximum Knowledge For Maximum Results!
Home owners can definitely sell their own home, it is just a matter of time, effort, sanity, marketing, and sheer will power. Leveraging what is already in place is best, but owners that love to DIY, here’s what you need: a home, lots of time, and more knowledge. Pretty simple, right? The biggest reason why By Owners fail to sell, is lack of knowledge, followed by time commitment.
#1-Your time is valuable.
Home selling is a time suck, and let’s face it, most home owners also work regular jobs. But working a 9-5 day job, M-F shifts, or late nights, or are traveling for work, reduces the available time to show the home. And not having the home immediately available means the buyers may move on to the next one they can get inside to see. This can cost you a valuable buyer. It does eat in to your personal time, but scheduling home showings is absolutely vital to finding a buyer quickly.
If you are unable to show frequently, be sure to add extra market time to your expected sale date because if it takes you a week to do one showing, that can really slow down offers. You need showings to generate offers.
Realtor Tip: My rule of thumb is 7. After 7 days of showings with no offers, something is off and you should check your property price, condition and neighborhood market.
Another way to look at your time being valuable is this: If you’re at work being paid $50/hr, then you know exactly what your work is worth for 1 hour. Of course, the hours you put in to sell your home are Unpaid. Your time is still worth a lot, but now you are dipping into your personal time, nights, weekends to market, show, clean and/or negotiate your home sale.
I add it up like paid sick time. Lots of folks earn sick days, maybe 5 days a year. Who really wants to meet an unqualified buyer at the cost of a sick day? Or worse, dig down even deeper and give up a vacation day? That is about as much fun as taking a vacation day for a root canal.
# 2 Know your property is only as valuable as the appraisal.
NOTE: Market values are consumer-driven and appraised values are driven by experts.
Your property is valuable, but the buyers determine it’s market value. And that does not always match the appraised value. Market value is what the buyer in today’s market will offer for your property, so it is consumer driven. The Appraised value is driven by experts, as those hired by a mortgage lender to appraisal a property before approving a mortgage on it. It is unlikely a bank will approve a mortgage above the appraisal price.
Realtor Tip: Get a current report on the home sales in your area.
So let’s say you picked the perfect number. What if it still doesn’t get an offer? Notice I said “offer”. Receiving an offer does not mean it is sold. Offers are a good thing, because they mean you’re on the right track to get a deal done. No offers, means no deals.
Think about it: if you get a lot of showings, that’s great. Having folks come through to see your home is a necessary requirement to getting it sold. Let’s say you get 3 people the first week, 3 the second week. But then in the third week, you get 1 person, and in the fourth week 4, you get zero.
What the heck happened? Excellent question. It could be you forgot to run your ad, you didn’t do an open house, or your price is not enticing enough. The shine has rubbed off your FSBO sign as most of the investors in the area have likely already called you.
Realtor Tip: if you’re in a seller’s market, and you have showings but no offers, means you’re priced too high. If you’re getting showings and some offers, you’re in the sweet spot. If you get full price offers before the sign is in the ground, you’re priced too low.
By the way, you can test this with a private listing. Ask me how.
#3 Knowledge is power
Pre-screening is vital for buyers to avoid wasting your time. Knowing your bottom line with a Seller Net Sheet will help you negotiate a deal better. But unless you pre-screen the buyers, you could waste a lot of time with looky loos. Never take an offer from a person who is not pre-approved by a mortgage lender or has no proof of cash. A serious buyer won’t hesitate to show you money.
Now that you’ve come this far, it’s time to level up your strengths and get into the nitty gritty of negotiation. If you’ve done your research and are confident in your value, it is time to use your leverage wisely.
My favorite tip: the agents who call you to say they have a ready buyer, can they come look at your house? And you should say “Absolutely, yes!”, and set up a weekend visit for all agents to bring their buyers through. Make it a one shot deal and have all the agents visit at the same time.
Why? They’ll either bounce fast or try to convert you to a listing. Tell them you will offer them a full commission of 2.5% if any of them bring you a buyer.
Home owners armed with the proper information can most certainly sell their homes by owner. It is up to the individual to decide if the time and effort is worth it, much like any home project.
Ready for even more tips how to sell your home like a pro, including how to leverage auctions? Don’t forget to check out my Podcast with more tips on Selling By Owner!
Jennifer Kinzle, SFR Broker Fox Valley Homes
Charles Rutenberg Realty
3135 Book Rd
Naperville, IL 60563