If you’ve decided to sell your Florida property and you want to avoid the expense of using a local Realtor, the good news is that you’re not alone.
Many sellers choose the For Sale By Owner (“FSBO”) option each year. It’s far easier for a US resident who’s there all the time, of course, but UK owners have also been successful. First of all, though, what are the common mistakes to avoid?
- Getting the price wrong – over-pricing will frighten off the buyers; under-pricing will cost you money.
- Under-estimating the work involved – it’s not for the faint-hearted!
- Ignoring the possible pitfalls – understand the selling process so you can take action to keep the sale “on track” where necessary.
All of this will become clearer if we look at the For Sale By Owner process in more detail:
1. Prepare to sell your home: If you have a mortgage secured on the property, check if there are any early payoff penalties. Decide how you’re going to prepare the contract and handle the closing (e.g. Title Company or attorney). Read up on FIRPTA is you’re a non-US resident (Google can be your friend here, at least to begin with!).
2. Prepare your home for sale: Make it look as much like a new home model as possible (no clutter, new paint inside and out, clean carpet, etc.). Remember that neutral colors and furnishings give you the best chance of finding a buyer.
3. Decide on your selling price: Find out the asking price of homes currently for sale in your neighbourhood, and what prices recent sales achieved (preferably in the last 3 months). Be sure to compare appropriately i.e. approximately the same square footage, lot size, beds and baths, etc.
4. Market your home: Place a FSBO sign in the front garden with a contact phone number. Advertise in newspapers, FSBO and other web sites. Find real estate offices that offer fee-for-service menus with an option to list on the Realtor MLS system. Click here for more details on the MLS. Tell everyone you meet that you have a home for sale. Place ads at the local grocery stores and supermarkets, where allowed (US and UK!).
5. Show your property: If you’re an “absentee owner”, you’ll need a friendly local resident or acquaintance to let buyers look around. This may be the most difficult practical problem to solve.
6. Deal with the offers: Use a standard real estate contract that you fill in yourself (very, very risky) or preferably an attorney to help you through the offer/negotiation phase. Remember that an attorney’s help will use up at least some of the costs you saved by not using a Realtor.
7. Progress the sale: these steps include the home inspection, termite inspection, loan approval, appraisal and finally closing. Your home is not sold until each stage is completed.
8. Close the deal: Buyers and sellers each have their own sets of documents to sign/initial, but this part can be done remotely – by “mail away” if necessary. Your lawyer or title agent will prepare the documents and advise you where to sign. After all documents are signed and the buyer’s lender has transferred the balance of funds, you get your proceeds!
Finally, be sure to leave your home in clean condition deliver the keys at closing to the new buyer!
Then celebrate – you did it!