Wayne Curtis, REALTOR®
If you’re thinking of selling a house for the first time, and even if you have sold a property before, a question might have crossed your mind: could I sell my property myself? Particularly in a sellers’ market, how hard can a ‘For Sale by Owner’ (FSBO) be?
For many, the home sale process can be difficult to navigate without help. Before you decide to go it alone, take the following into consideration:
Do you know your local market conditions?
One of the first steps to selling a home is determining what it is worth. This will require you to research recent property sales in your neighborhood and distinguish between properties that compare favorably to your home and ones that do not. In addition, you will need to judge current market conditions, such as available inventory, interest rates, and buyer sentiment. All of these play a role in setting a fair price for your home – one that maximizes your sales price while preventing your listing from lingering on the market.
Do you know about real estate contracts and required disclosures?
Selling a home in Maryland requires a property owner to reveal certain characteristics about a home and the land that it sits upon. These disclosures may change every year due to new laws being passed at the state and local levels.
The average purchase contract has increased in size over the years from about 20-25 pages to a minimum of 50 today. Really complicated deals can pile on addenda and disclosures and add significantly to that number. These documents have, in many cases, come about because of prior legal disputes and are necessary to protect both parties. To avoid being caught in litigation yourself, make sure you know exactly what is required of you as a home seller, and what requests a buyer is making of you in their contract offer.
Can you be objective?
Your home is your castle. It is not only a place to live and the source of many of your family’s most cherished memories, but also the main source of your net worth and potential generational wealth. Of course, you think it should sell for top dollar and buyers will be thrilled to purchase it.
That can make it hard to be objective about your home price and condition. You will need to take a step back and look at your home as a potential buyer would. Things you’ve learned to live with might stand out like a sore thumb to a buyer seeing it for the first time. Those issues could lower their offering price, or even cause them to move on to the next property without making an offer.
The same goes for the back and forth of contract negotiations. Are you in them to “win,” or will you be able to focus on what both parties want from the deal – a successful home sale?
Do you know what to do when complications arise?
There are many, many reasons a deal can fall through before it reaches the settlement table. It could fall apart because of issues with the property itself — some of which you might know about, some of which may be a total surprise. It’s not uncommon for a professional home inspector to flag potential issues that might then be the subject of a more detailed examination by a licensed tradesman on things like a septic system, private well, or chimney. Those findings could result in a buyer asking for repairs or financial considerations – or even looking to exit the contract altogether.
You could also have issues outside the walls of the property itself. Buyers can have financing complications, the title search may uncover a lien or other defect, or the property may not appraise for the purchase price. In those instances, you as the seller will have to determine how best to resolve those issues so that the sale can move forward.
How do you deal with stressful situations?
Yes, home sales are stressful. Each contract clause and contingency can involve hundreds, possibly thousands, of dollars hanging in the balance. And disputes usually arise at a point in the transaction where stress on both sides is high, patience is thin, and people want to retreat into their fortified bunkers and battle it out instead of reaching a compromise.
Most sellers underestimate the amount of stress that they will experience through the six weeks of the average real estate transaction. If you aren’t careful, that stress level can cause people to hold on to positions and make decisions that — from a calmer perspective — might be self-defeating. In the heat of the moment, you don’t want to make a snap decision that can cause the entire transaction to fail.
Do you have the time?
They say selling a house can be a full-time job. Between marketing your property, answering inquiries from real estate agents and potential buyers, scheduling showings at the buyer’s convenience, or meeting with inspectors, appraisers, and contractors on short notice, it’s easy to see why. How much time away from your current employment can you afford? How many days off or very long lunch hours will your supervisors allow before they start giving you the dreaded side-eye?
Selling a home For Sale by Owner is a real commitment and should be treated as one. Before embarking on this task, make sure you are up for the journey.
