Sell Your House Without an Agent

Although many sellers choose to sell their homes with the help of real estate agents, the use of a third party is not required in most U.S. states. For a motivated and dedicated homeowner it is possible to save on commissions by selling your home without an agent. If you decide to "self-list," learn the following simple but very important steps to help you with your sale.

Steps

Researching and Timing Your Sale

1. Hire an attorney. If you're going to sell your home without an agent, it's advisable to have a real estate attorney standing by to help if needed. See below for instances where you might need an attorney. You would have to pay only for legal services actually rendered, as opposed to paying a commission to an agent.
2. Consult with one or more agents. Prior to deciding to self-list, speak with at least one real estate agent. Get a sense of what they can do by asking about their years of experience, average time to find a buyer, how their services would relieve you of liability, suggested pricing, and why they think you should sign up with an agent rather than selling on your own. Naturally they will favor hiring an agent, but at least consider what they have to say. They do offer value for what you pay them.
   • The average self listing often achieves the asking price while avoiding the agent's commission of 6% or more. A 2008 Consumer Reports study found that nearly all homeowners in their survey who sold on their own got their asking price, while sellers using agents received an average of $5,000 below their asking price. Similarly, National Association of Realtors figures show the average sales price in by-owner listings was 97.5 percent of the asking price — while sellers with agents got just 95 percent.
   • Not all agents are equal. Not every one has the same experience, expertise and dedication toward maximizing their clients' selling price. Before you decide whether to sell on your own, ask a prospective agent questions that concern you. Ask for references, too.
3. Determine a good time to list your home. There are certain times of the year more likely to yield a profitable sale. Generally you want to sell when the weather is good, before school begins and not near the December holidays.
   • In the U.S. some suggest that the week after the Super Bowl is the best time to list your home (meaning February). While studies show that this time is ideal and has the most buyers, it also tends to be the time of year with the most Find Motivated Sellers when Looking to Buy Real Estate. Some find that the spring is the best time to list.
   • It will be more difficult to sell a family-sized home at an advantageous price once school has started. After all, it can be tough for families with children to change schools mid-semester.
4. Consider the weather. Sooner is generally better if you want to "beat other homes onto the market," but think about the weather. Depending on your location, you may have excessive cold and/or snow to deal with. How does your yard look with two feet of snow? Would your home look better in the spring when your yard and landscaping are at their most appealing?
   • Weather-related websites or newspaper offices can provide you with historical data regarding the best time of year to sell in your area. Keep in mind that job relocations will occur throughout the year.

Preparing the House for Buyers

1. Price your home appropriately. One way to do this is to hire a professional real estate appraiser. This person will objectively seek out properties similar to yours and research the prices of recent sales. You can do this research yourself, because there are several websites that provide recent home sales data by geographic location.
   • You can price the house on the high side for awhile, and if you aren't seeing any interest, you can lower the price. Buyers will be expecting a lower price since they know you are selling without an agent. You do not want your home to become "stale" from sitting too long on the market because you priced it too high.
2. De-clutter the house as much as possible. When packing things for your eventual move, be sure to leave essentials. Remember you may still need to sleep, eat, and live in this home in the short-term, but now is the time to remove anything which is not essential. If you are not taking something with you, give it away, sell it, or trash it.
   • Extra furniture and items of clutter make homes look smaller and give the impression that there is less room than there is. Children should choose a limited number of toys, then pack the rest. If necessary, the toys can be rotated.
   • Store it! Lots of companies specialize in storage, from off-site storage units to companies that pick up and drop off storage units at your door. This way you can get rid of all non-essential furniture, silverware, books, etc.
   • Sell or donate. Although some of your things may not be coming with you, it may be difficult to part with items you feel are valuable. Give yourself a budget and a time line, and try to sell these items until either the budget or the time have expired. In the end your life and your upcoming move are more important.
3. De-personalize the house. Try to make your home "neutral." The idea is to let the buyers imagine themselves in the home without any overlays of your own preferences, beliefs, styles, etc.
   • Remove religious items and most, if not all, family photos.
   • Remove unique decorations, and paint in neutral colors. Colors which have universal appeal are typically tan, beige, and gray.
   • Clean and organize the house, including floors, carpets, closets, and windows.
   • Many sellers hire a professional stager to advise them about what to store and what needs to be painted, as well as how to furnish a room to make it look attractive to buyers.
   • If possible, make arrangements for pets, children, and other family members to be out of the house when it's being shown. Distractions may interfere with a buyer's ability to concentrate on the home. First impressions are formed quickly. Don't let your prospective buyer waste time looking at your photos or your pet.
4. Consider curb appeal. Do whatever repairs and clean-up required to make that first impression positive. It is particularly important to have the front entrance looking good.
   • In the winter make sure walkways and steps are shoveled and safe to walk on. Think about access to the backyard and detached garage, too.
   • In the spring and summer consider refreshing the home with paint, and plant flowerbeds or pots to make the home more inviting.
5. Put away all valuables. As buyers will be wandering throughout your home, keep all valuables safely and securely locked up. Since you don't want to feel like you need to tail buyers while they look, cash and jewelry should be in a safe or simply well hidden.
6. Create professional-looking flyers and postcards. Various sites offer templates where you can customize the text and upload digital photos. Then put out a flyer box next to your "for sale" sign so potential buyers can read all about your property.
   • If you decide to list with an agent, he or she will prepare your flyers, videos and postcards.

Preparing Forms and Background Information

1. Prepare a list of all improvements and upgrades for prospective buyers. This should include the approximate dates the improvements were made, especially for the roof and furnace. You might also make a list of all items to be excluded from the sale such as light fixtures. Include anything you would consider selling under separate negotiations.
2. Prepare information about commuting, schools, and your town or community. Prospective buyers will probably not be familiar with roads, schools or local transportation. Be prepared to answer questions about why you are selling.
3. Be clear about any disclosures you need to make. Some disclosures are not mandatory in the case of a "For Sale By Owner" (FSBO), but having such a document available can answer many buyer questions about your home. Appropriate disclosures include information on previous fires, floods, or violent death. (The latter is the subject of some controversy. A legal or real estate professional can help you sort that out.)
   • Lead paint disclosure is mandatory even with a FSBO, so make sure you have a form for your home, particularly if it was built before 1978. This form can be obtained online at hud.gov.
   • Disclosure forms are generally available online for your particular area (search "Disclosure form, Michigan" for example) and at your local office-supply store.
   • Most real estate offices can provide you with all necessary disclosure forms.

Offering an Hold an Open House

1. Get good exposure. Selling a home is about exposure, so anything that will expose your home to more people is beneficial. Consider the cost of local newspaper advertising, flyers, writing and printing property-information sheets, and taking the time to tell your neighbors and friends. Costs can add up quickly, so keep in mind what you are willing to spend.
   • Put a sign in your yard with your contact information. Place other signs around town, too, with your address and Open House hours. Choose busy locations for your signs.
2. Consider listing your home on Internet sites. Choose your sites carefully, as many of them are designed mostly to promote themselves. If their home listings have not been recently updated, there may be several homes listed that are already sold. Buyers may get frustrated and never even notice your listing.
   • Popular For Sale by Owner websites include Zillow, Owner.com, Hotpads and Trulia. Each of these sites can send your listing to Realtor.com. They should also list you on your area's multiple listing service (MLS). Advertise your home on Craigslist, and update the content whenever appropriate. Advertise on your Facebook page and LinkedIn. Email photos and information about your listing to everyone you work with (assuming this is permitted), and ask them to pass the information along to others.
3. Play it safe. If you live alone, be smart. You probably shouldn't be the only one home when your house is open for viewing. Not everyone may be coming just to buy or look.

Accepting an Offer

1. Know how to accept an offer. Accept written offers only. If your buyer is serious, s/he will write up an offer and include a deposit. You need a contract for the buyer to use. You can find one online, or ask a real estate attorney for one.
   • Remember that the buyer knows you won't be paying an agent's commission. As a result, s/he may try to negotiate a lower price than you'd like. Be prepared to defend your asking price with evidence of other recent prices in your area.
2. Draw up a contract. Contract forms are available online or through an attorney. Consider the completed contract carefully before you sign it. Do so only if it has been reviewed and approved by a real estate attorney. The contract should be accompanied by a mortgage pre-approval from a qualified lender as well as the initial deposit check or money order.
   • If the buyer has an agent, remember that s/he is looking out for the buyer's interests, not yours. The seller should never be expected to pay the buyer's agent's commission (unless the seller is quite desperate for a sale).
   • If you accept a "contingency offer," typically that means you would have to wait until the buyer sells his/her own home before they can buy yours. That leaves you in limbo until the other party's home sells. You have no alternative but to start over if the buyer backs out of the deal once they experience difficulty in selling their own place. Another typical contingency allows the buyer to back out if s/he does not like the results of the home inspection.
3. Require a non-refundable deposit with the signing of the contract. You will want the buyer to put up a non-refundable deposit. Otherwise, the buyer could renounce the contract at any time, leaving you with no recourse but a lawsuit. It is common, however, to include a written stipulation that there are certain situations in which the deposit could be returned to the buyer, such as a bad inspection or the discovery of information that should have been disclosed to the buyer but was not.
4. Make the acceptance of any offer contingent upon attorney approval. Have the contract and closing paperwork checked by your attorney immediately. Be sure that the mortgage papers and the deed are prepared properly for your protection. You will be signing over your rights to the other party, including the deed, so it has to be done correctly.
5. Require your buyer to purchase a buyer's title insurance policy. If there are any title problems found after the closing, title insurance will be responsible for fixing them. The buyer's agent will arrange for title insurance.
6. Deal with the inspection. The buyer's agent may not have the knowledge to explain minor defects vs. major ones in a home. During inspection, anything the inspector points out is of concern (especially to a first-time buyer).
   • Be prepared to respond to the buyer's concerns. Inspection issues are a common reason contracts are rescinded. Without an agent to advise you on what is a reasonable issue and what is customary, you will need to discuss these things with an attorney. Ultimately, it always comes down to how badly you want to sell your home and how badly the buyer wants to purchase it. You may have to drop your price or offer to pay for repairs.
   • Obtain a "Certificate of Occupancy" or "Fire and Safety Inspection." Check with your town clerk and find out which regulations you need to comply with. If you need a Certificate of Occupancy, find out what the inspector will be looking for. If you need only the fire and safety inspection, find out the requirements for the smoke detector, fire extinguisher and carbon monoxide detector so that when the inspector comes there will be no issues, and you will get the certificate you need for closing. Another test often required is for radon gas in basements. Do-it-yourself kits are available for this.
7. Expect a bank appraisal. The bank making the loan to the buyer will want to appraise your property. Banks are not usually generous with appraisals. Without an agent to help you evaluate an appraisal, you will have to trust the appraiser to pick the right comparable properties.
   • Be aware that if your buyer is taking out a conventional loan and putting down 20 percent or less, they cannot get a loan if the home does not appraise for at least as much as you were offered. If they are going with a Federal Housing Administration (FHA) loan, you will not be allowed to seek another appraisal for six months, even if there is a different buyer.
   • If your home does not appraise as expected, discuss your options with your attorney and ask him or her to talk to the buyer's attorney. If you really need to sell, you may have to lower your price to the bank appraisal, even if that is below the contract price.
8. Be prepared for other problems. Additional reasons may arise for not going through with the deal. The buyer may not be able to get their Shop for a Home Loan. Bank regulations keep changing, and it's getting harder to qualify. Buyers who use a non-bank or large, well-known reputable lender may be held up for days, weeks or months even when there are no real issues with their qualifying for the loan.
   • Sometimes circumstances change, and the buyers no longer qualify and can’t get the loan.
   • Inspection issues and the bank appraisal are contract contingencies. If you and the buyer cannot come to an agreement, the contract is canceled, and the buyer will probably get their deposit back. This can be costly to you, as not only is your home now “older inventory,” but another buyer may be concerned that there are inspection issues that they cannot see. In a declining market, the price you need to set when you go back on the market may be lower than your original price.

Leaving the Sold House

1. Arrange for a final water reading a few days before closing. This information needs to be sent directly to the attorneys who are preparing the closing. They must ensure that payment is made for the outstanding water bill out of the proceeds of the sale.
2. Pack and get ready to move. If everything goes well and all contingencies are met, prepare to move. You are responsible for keeping the house in the same condition as when the buyers inspected it except for repairs or replacements you agreed to make. Buyers will go through the house again before closing, so make sure you plan to be moved out at least the night before.
3. Leave the home in broom-clean condition. Floors should be swept or vacuumed and the inside of cabinets and the refrigerator wiped down. If you have leftover paint that matches the current paint on the walls, leave it in the basement, garage or closet.

Things You'll Need

• Appropriate forms

Related Articles

• Apply for a Short Sale
• Hold an Open House
• Present the Outside of Your House for a Quick House Sale
• Prepare Your House for Online Sale
• Sell Your House Fast

Sources and Citations

See also

• Pay Less Real Estate Commission
• Buy and Sell a Home at the Same Time
• Sell Your House Fast
• Hold an Estate Sale
• Prepare for a Closing
• Sell Your House Using a Lease Option
• List for Sale by Owner Using MLS Listing
• Sell a Mobile Home
• Do Your Own Real Estate Closing
• Get Your House Appraised

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