How To Sell Your Home Without A Real Estate Agent
By Mark Nash
Considering the rapid rise in home prices over the past several
years, home sellers are taking a hard look at the commission
they have to pay to a real estate brokerage to market and sell
their home. Real estate commissions vary across the country;
they average in the four to seven percent range.
According to the 2004 National Association of Realtors®
(NAR) Profile of Home Buyers and Sellers fourteen percent of
homes were sold by-owner. The NAR study listed the two most
difficult tasks for for-sale-by-owner (FSBO) were preparing
and fixing up the home for sale and getting the pricing right.
Invite three full-time mid to high producing agents to your
home to give you an opinion of price. Understand that if the
three price opinions are not what you think the property is
worth, you should understand the danger of an over-priced property.
Homes that are over-priced have been studied by large national
real estate brokerages and over-priced homes take longer to
sell and sell at a lower price as a percentage of the original
Ask the agents to give you constructive feed back on what you
should do to make your home visually appeal to the majority
of buyers. Below are some staging tips to prepare your home
1) Research how to “stage” your home to maximize
its appeal to homebuyers by creating a spacious and pleasant
home environment for buyers.
·Start by removing the first thing that gets in your
·Take one or more major pieces of furniture out of every
room to make it more spacious.
·Keep matching furniture pieces together to build uniformity
in a room.
·Create seating areas where two or more people can talk.
2) Keep the eye moving when staging a room.
·Use furniture placement to direct the buyer’s
eye toward a room’s features.
·Move large pieces of furniture away from windows.
·Place large furniture at entry end of room to lighten
visual load at opposite end of room.
·Use area rugs to anchor seating arrangements.
·Have your dining table closed to its smallest size.
3) Use furniture placed on angles in a room to give it a quick
·Angle a bed in a corner of a bedroom to focus attention.
·Angle furniture in a V shape in living and family rooms.
·Angled furniture can help fill a room short on furniture
and lend a designer look.
4) Create vignettes in rooms to set mood.
·Breakfast tray with coffee cups, newspaper, flower
vase on bed.
·Set the dining room table with linen tablecloth, china,
·Set up game table for chess, bridge, or backgammon.
5) Effective model homes focus on creating the right environment.
·De-clutter so buyers can overlay their furnishings
·Clean, fresh, and new smell.
·Attention to detail. Clean rooms and landscaping trimmed.
·Subtle background music, classical, light jazz, or
·Interior décor and wall colors accent home’s
·Live plants or fresh flowers add finishing touches.
6) Understand decorating basics that can guide you to repositioning
·Color. A little goes a long way.
·Scale. Do furniture sizes complement or overwhelm a
·Pattern. Easy does it to avoid distracting from room
·Lighting. Use it to define dark corners. Helps to fill
out a room.
·Focal point. Fireplaces, views, art, find one in every
·Texture. Adds visual interest, warms cold spaces and
Understanding and completing the paperwork in a real estate
transaction was number three of the most difficult tasks according
to the NAR study. Once your home is priced right and ready for
market you should retain a real estate attorney to help you
review contracts, disclosure forms and to help you qualify potential
buyers of your home. An experienced real estate attorney can
help you avoid the common pitfalls in real estate negotiations
and will facilitate a smooth transaction.
Here are some cliff-notes on real estate contracts.
·Use an approved real estate contract by your state
real estate attorney association or local Board of Realtors®.
·Real estate contract. A binding agreement between buyer
and seller. It consists of an offer and an acceptance as well
as consideration (i.e. money).
·Acceptance. Agreement by the parties of the terms of
·Contract length. Research customary contract lengths,
the standard is 45 days from contract to closing.
·Have sold comparables properties on hand for prospective
·Comparable. Closed prices for similar homes in age,
condition, location and size.
·Price. Study average sold prices as a percentage of
lists in the last six months.
·Low-ball offers. Buyers should offer over 87% of list
if they are serious, otherwise you will should not responding
at all to low-ball offers.
·Counteroffer(s). The response to an offer or a bid
by the seller or buyer after the original offer or bid. Request
all counteroffers to be in writing.
·Require all buyers to present the highest level of
mortgage commitment with their contract.
·Mortgage Commitment. A document by a mortgage lender
that commits the lender to providing a loan at agreed terms
·Mortgage term, rate and amount. Look for strong down-payments
of thwenty-percent or more. Interest-only loans signal that
the buyers could be stretching to qualify for a loan.
·Cash offers in lieu of mortgage financing should be
confirmed with a letter from your financial institution stating
funds are on deposit to close the contract.
·Federal law requires Lead-Based Paint Hazard disclosures.
·Lead-Based Hazard. A disclosure of reports or knowledge
of Lead-Based Hazards. Buildings built after 1978 do not present
·Read Protect Your Family From Lead in Your Home by
the US EPA.
·Real property disclosures required by the federal or
your state Written statements by the seller(s) of a property
disclosing any known defects.
·Local disclosures. Local requirements of disclosure
that the seller provides and the buyer acknowledges, such as
certificates of occupancy.
·W-9 form. An IRS form requesting taxpayer identification
and certification numbers of buyers to receive interest on earnest
money from delivery to closing.
·Subject to appraisal. Most contracts as part of the
mortgage contingency require the subject property to appraise
at a minimum of contract price.
·Appraisal. An objective third parties opinion of value
by a licensed or certified appraiser.
·Earnest money deposit. Money given to the seller at
the time the offer is made as a sign of the buyer’s good
·Research customary earnest money deposits as they vary.
The larger the deposit, the increased motivation you buyers
show to perform the contract.
·Refund of earnest money deposits. Contracts should
provide for refund of the entire earnest money deposit within
agreed contingency periods. Seller’s attorney should hold
earnest money deposits.
·Attorney approval period. Your attorney reviews and
makes changes to the contract, typically 5-7 business days.
·Property inspection period. The right under a contract
for the buyer at their expense to discover the actual condition
of the property. This period typically runs 5-7 business days.
·Well and septic inspections. These are independent
of structural and mechanical inspections.
·Timelines for contingencies run concurrently.
·Contingency. A provision in a contract requiring certain
acts to be completed before the contract is binding.
·Closing/ escrow date. The date of the end of the transaction
process where the deed is delivered, documents are signed, and
funds are dispersed.
·Possession date. The date agreed by contract when the
buyer can occupy the property.
·Final walk-through. A property tour before closing
or escrow that permits the buyers one final verification of
condition, agreed repairs and personal property.
·Tax pro-rations. The amount of credit given to buyers
at closing for unpaid property taxes, when taxes are paid in
arrears. Pro rations should always be more than 100 %.
·Personal property. List and initial all personal property
included with the sale, such as air-conditioners, appliances,
and playground equipment.
·Home sale contingency. The contract is contingent on
the sales of the buyer’s property.
·Buyers show motivation when including a home sale contingency
by having their current property already on market.
·Home closing contingency. The contract is contingent
only on the successful closing of an existing real estate contract.
Marketing your home to prospective buyers should include these
methods. ·A professionally painted yard sign.
·Newspaper advertisements classified and photo.
·Public and broker open houses.
·Internet: virtual tour and at least eight photos.
Mark Nash is a real estate author of four books, his latest
“1001 Tips for Buying and Selling a Home” is available
in bookstores nationwide and on Amazon.com. Mr. Nash is a full-time
real estate agent in Chicago and has shared his residential
real estate tips with CBS The Early Show and Bloomberg TV.Real
estate journalists from around the country turn to him to help
their readers understand the real estate market.
Visit him online at http://www.1001realestatetips.com