A question I am always asked is, Is selling your home on your own legal? The answer is YES! There are a lot of steps and if you want to save money on the real estate commission then this plan will help you. You are taking on the activities of the real estate broker so be prepared to set aside some money and time to execute the process and have a successful transaction.
ESTABLISH A PRICE
The first thing you need to do is establish a price. Gather the recently sold properties, with in the last 6 months, in the area, the features of your house and adjust up or down based on professionally accepted appraisal valuation techniques. For example, it is widely accepted the value of a bedroom in Massachusetts is 5k for the appraisal. Then you need to look at the Local Housing Market and determine the absorption rate which indicates if it is a “Buyers Market” or a “Sellers Market”. With this data you will be able to establish an asking price but at the end of the day the price reflects what the seller will accept and the buyer will pay.
GOOD PHOTOS AND VIDEO
A big part of selling your home is making sure it’s easy to discover by marketing it properly. One of the best ways to immediately put your listing above more basic listings is to have a set of good photos clearly showing the space and what it has to offer.
Lighting is key in great photos. If you are taking the photos yourself you need to play around with the light and the angles. The photos need to tell a story and you need to highlight the features of the house. To go one step beyond and make your listing even more unique, is to have a video tour. There are several types that you will need including but not limited to a walk-through video, a drone, and then what I call a “property tour”. These different mediums can be used in a variety of applications for marketing on-line. Additionally, for the video make sure you have footage in 30 seconds, 60 seconds and over 5 minutes to make the video favorable to each on-line platform. Photos will allow a potential buyer to see the basics of the rooms on offer but a 3-D tour will give them a better idea of the available space prior to them stopping by for a showing or open house.
HIGHLIGHT RENOVATIONS/UPGRADES/CARRYING COSTS
In your listing, make sure to sell the renovations and upgrades you’ve given your home. If you have installed new lighting, floors, or done a full kitchen or bathroom remodel, let that be out front and obvious. Your ideal buyers want to know the property they’re considering has been well cared for and provides greater value for them than your competition. A Home Notebook is a great way to communicate with the buyer. Every buyer wants to know if they can afford the house. Providing the carrying cost information allows for an easier negotiation process.
MARKETING/ADVERTISING ON SITE AND OFF SITE
The more people that know about your home being for sale, the better. One of the simpler things to do is get a For Sale Sign posted in front of your home. You will also want a brochure of the house. There are boxes you can have on-site that will hold your listing sheets so when buyers drive by they can grab a flyer. Sometimes friends are looking for other friends too and they will stop and jot down the address so you can see how a sign would attract a potential buyer. These signs help create awareness around your neighborhood and help spread word of mouth.
By having the brochures available it provides your ideal buyers with information right then and there. Never underestimate how effective simple solutions like a sign and brochures can be in selling your home.
SELL THE NEIGHBORHOOD, NOT JUST YOUR HOME
Most home sellers get caught up in what’s happening on their property and forget about what could be a great asset: the entire neighborhood. While you are directly selling your home, you need to leverage any positive things about your surrounding neighborhood.
Maybe you’re located close to a park, playground, or school. If so, this could be a huge draw for families or younger people looking to have a family in the next few years. Think beyond the boundaries of your property and find ways to play up your neighborhood and any access to convenient locations.
ON-LINE & SOCIAL MEDIA ADVERTISING
Online outlets are a great place to let a large number of people in your area know about a property listing. You can easily hit a lot of people in your area – or looking to move to your area – by putting out a message or two, over time, through groups on Facebook and Twitter. Realtors advertise through places like the MLS, Zillow and Realtor.com, and you can list your home for sale by owner on these sites too. Additionally, your own website for your house is helpful. You can buy the domain name and set up the site. Video is the #1 medium that buyers watch and share (One tip is that most websites do not host the video so, you will need to find a platform that will accomplish that marketing objective.)
Then there needs to be a paid on-line advertising campaign on on the platforms such as, Google Ad Words, Facebook and Instagram. As of now platforms like Realtor.com, Zillow and homes.com do not sell advertising space to homeowner, only to real estate brokers/agents.
Don’t discount paid print media! Oftentimes buyers are looking at the local paper, ie. Boston Globe when they are coming to a town and exploring. You can also send out postcards to your ideal customer.
SCREENING THE BUYERS
Many FSBOs (For Sale By Owner) mention the buyers that come through the door come to look at the house but that is it. So, it may be helpful to realize the types of buyers that contact FBSOs. Oftentimes it is investors that are looking for a discounted property so they can take the house , improve it, and sell the property for a profit. Obviously in this situation they are not looking to offer you the highest price. Then there are buyers that are out looking that have not gotten pre-approved so, it might be a good idea to ask them for their pre-approval letter. It sounds tedious and of course you don’t’ want to turn away a buyer but, at the same time it is a lot of work and time consuming to get the house ready for a showing. If you also have to leave work to show the house then, you need to consider that component as well. And finally a typical group of buyers that frequent For Sale By Owner homes are thoses that are not qualified and will ask if you could lease to own. Then you need to decide if you need then money to buy another house and if you want to become a landlord.
You will need to be present for all the showings and coordinate the buyer’s schedule with yours and if there is a buyer agent, that schedule as well. You don’t wan to put a lock box on your house and just give the buyers the code to let them in for a number of safety reasons with respect to your personal items but also if something happens at the house and there is damage or someone trips and gets hurt. Unfortunately, every year the Real Estate Industry Is put on alert about an agent being attacked or worse, killed. When you show your home, make sure there are at least two people at the house for your safety and never let the house be show when you have children in the house. Your personal and property safety is paramount.
You will need to negotiate the price, terms and condition of the sale and process the paperwork. Hopefully you will have multiple offers from which to choose! Massachusetts is an attorney state and therefore the Purchase and Sale Contract is written by an attorney. Additionally the Deed for the sale needs to be drawn up by an attorney and filed appropriately with the Registry of Deeds. You can call the Registry and see if there is a DYI way to execute the Deed. Don’t forget to have the mortgage released and it needs to be paid off as well when the house is sold. Every transaction requires a Smoke Inspection and the local Fire Department will come and inspect the house. Fire Departments usually only inspect on certain days and it can be done a maximum of 60 days prior to the Closing. Check the local town website for the specific apparatus needed (every town is different). You will need to have paid all your bills for the property in full, water and taxes, and if you are on a septic you will need the Title V Report, as well, in order to pass papers.
At the beginning of the process you will need to decide if you will cooperate and pay the buyer agent fee as 89% of home buyers use a real estate agent. While many of my friends say the fees for the Realtors seem high the truth is the industry has done a poor job of explaining what all the components are of the transaction and what agent does. Even though agents are affiliated with a franchise and there are some boutiques, as mine is, all agents run their own business and the reality is most agents don’t’ track the number of hours they spend working with clients. It just depends on the client and as a rule of thumb it is service before ourselves. In my experience, as I have tracked these hours and the hard costs (marketing, gas, insurance, license fees, subscription fees) the ROI is pretty low ( One time is was .25 per hour but my buyer is in the dream home and has made a fabulous investment!) Most agent don’t speak about this because at the end of the day this process is about the client as it should be. If you are successful in selling your home on your own you will save on the listing agent commission minus the hard costs to run the project and typically, the buyer agent commission. The rest of the closing fees will be part of the transaction regardless if an agent is involved or not.
I hope this information has been helpful and remember to be methodical and stay calm. Usually transactions fall apart because tempers flare. Remember too as a seller once you sing the Purchase and Sale you are locked into selling the house but, in Massachusetts the buyer can walk away all the way up to the day of closing.
If you would like more information on or have other questions, please reach out I am happy to help and serve my community. Here at Hottel Real estate we buy and sell every home as our own! Make it a great day!