For Sale By Owner Homes / Mortgage Blog

The ABC's of For Sale by Owner

By Mark Camphaug


Congratulations - you have made a decision that will likely represent the largest and most significant savings of your life. If your home is worth $278,000 (national average sale price of existing home) it’s a decision that can potentially save you over $16,000.

Here is a Step by Step “For Sale by Owner” Guide.


Step 1 – Prepare your FSBO home for sale:

• The simple fact of the matter is that the better your home looks and the general state of repair it is in is going to have a tremendous impact on the overall value and salability of your home. There are literally thousands of articles on the internet that will walk you through various “tried and true” methods to squeeze the most out of your home sale.


Step 2 – FSBO Appraisal

• Get a professional appraisal. You can pay for one ($40 - $100) or you can usually get a local realtor to perform an appraisal in the hope of listing your property after you give up trying to sell it yourself. Either way you obtain a realist price based on comparables. One of the most common mistakes by For Sale by Owner’s is pricing their home too high or too low – either way you lose. A professional appraisal can be a valuable sales tool to have it on hand when prospective buyers visit your For Sale by Owner property.


Step 3 – List Your FSBO

• Online Listings - First step is to get your home “listed” – there are several online venues that offer an opportunity to create an FSBO “online” listing. Prices range from “FREE” to $999 – depending on package. The internet has leveled the playing field significantly for FSBO’s – over 70% of all homebuyers see the property they buy online first!

• Flat Rate MLS – There are real estate agents that will provide what is referred to as a “Flat Rate MLS” fee. These agents simply charge a flat fee – usually in the $499 range to expose your property to the Realtor’s greatest sales and marketing tool. You agree to pay a pre-arranged commission (usually 2.5 – 3%) to a “selling agent” but maintain the right to find your own buyer and sell your own home without paying a commission fee. This route provides has a higher success rate then a “pure” FSBO sale and the homeowner still saves 3% on the sale of their home.


Step 4 – Market your FSBO

• There are many marketing steps and opportunities, but there are primary items associated with a successful FSBO sale. Number one is professional signage (18% of all home sales are initiated by a real estate lawn sign). Once you have your sign up you want to get as much exposure as possible. As previously stated there are several venues to list your home – some are free  - the most prominent free listing sites are Craigslist and FreeFSBO.com. The next step is traditional advertising, it’s unrealistic to think you can sell your own home and not incur some marketing costs. Once you have your sign and FSBO reference # you can start with some low cost classified advertisements that direct prospective home buyers to your online FSBO listing. You may also want to consider Open Houses although I am not totally sold on their direct value to the homeowner. I know Realtor’s use them as lead generation events – visitors may not be interested in your home but they are interested in “a” home. Since you are only concerned with one home the value of an Open House should be strongly scrutinized. Word of Mouth is another marketing tool – tell people you are selling your home – you would be amazed how many people buy homes from people they know. They may also know someone looking to move into the area. Print some flyers and get them up on local bulletin boards (grocery stores, video outlets etc).


Step 5 – Show your FSBO home

• So now you have a prospective buyer. Set up an appointment and make sure house is as neat as a pin (see Step 1: Prepare your home for sale). Escort the prospective buyer walk through your home at their pace. Answer questions, if prompted, don’t give long winded whimsical narrations in each room - once you walked through the home you can ask them if they would like to go through the home again by themselves while you make coffee or tea. Don’t be too chatty or pushy. They are their to see your home not to become your new best friend. Remember, they are typically with a Realtor that has little or no knowledge of your home – try to act professional and helpful throughout the showing.


Step 6 – Sell your FSBO Home

• Make sure you have a “sign in” book to capture name and phone number of potential buyer. Follow up the day after showing. Just a simple – “Hi, I’m just following up to see if you had any questions regarding the home” If they ask questions I would answer a few but tell them you will get back to them with some answers. This gives you a reason to stay in contact. Try to encourage “written” offers. There are great state specific “Home Sales Kits” that provide all the documentation required to facilitate the legal sale of your home - US Legal Forms is a great source (the state forms are in the $40 range).


Step 7 – Close your FSBO home sale

• Spotting “Buyer Signals” is easier then it sounds. Once you have a prospective buyer that has shown strong interest you have to ask for the sale. Here are some great “trial” close lines - “what would it take to put something to paper” or “you sound very interested, are you ready to write an offer?” or you can take the lighter, direct approach – clap your hands together and say “while - let’s write it up”. Remember to be yourself. Bottomline is most people will drag their feet unless there is urgency. I don’t think you should create false interest but if there are other scheduled showings let the prospective buyer know.

So, now you are ready to sell your own home? No - but you are certainly better prepared. The internet is a glorious tool that is full of helpful hints on how to sell your own home – leverage that resource. As you know the savings associated with a successful FSBO sale is tremendous. Any advantage or edge you can gain will save you thousands of dollars – it is definitely worth the effort.