Guide to Selling your Home on your Own

If you're reading this, you're probably like thousands of other homeowners who want to sell their house. Except, unlike most of them, you want to sell it yourself, without the use of a real estate agent. Why? Probably because you want to save the commission. I don't blame you one bit... the prospect of thousands of dollars in savings can be quite appealing.

I'm not like most real estate agents who will try to convince you that selling on your own is silly. In fact, if you're willing to learn the process and invest the time and money to do it, you absolutely can sell your home yourself and save thousands of dollars in commissions!

THIS SITE WILL SHOW YOU HOW, STEP-BY-STEP!!

Before we get started, I know what you may be thinking: "Why in the world would a Real Estate Agent want to show me how to sell my home myself?" It does seem a little odd, but there's a perfectly logical explanation.

The fact of the matter is, over 86% of homeowners who attempt to sell their home on their own eventually end up listing it with a real estate agent. I will do everything I can to assist you so that you can achieve your goal of selling your home yourself, and there is absolutely no obligation. All I ask is that if your situation changes and you decide to list with an agent, please allow me to show you the steps I take to market a home, and at least consider me for the job. Fair enough?

If you are successful in selling your home yourself (and chances are excellent that you will with the tips on this site), experience has shown me that you may remember the help I provided and give my name to others who might need my services. And, if your goal is to purchase another home, I would be pleased to help you with that here in Anchorage, or refer you to a qualified member of our referral network if you're moving outside. That being said, let's get started!

Preparing your Home for the Buyer's Eye

Consider the last time you sold a car. If you're like most people, you probably washed it; waxed it; Armor-All'd the tires; vacuumed the carpet; used a spot remover on the upholstery; cleaned out the glove compartment, the back seat, the trunk, the door pockets; got everything out of it that didn't belong there; fixed any dings or dents in the body; filled cracks in or replaced the windshield; and possibly even had the engine steam-cleaned.

Why not do the same for your home? This article tells you how:

De-personalize the House

The reason you want to "de-personalize" your home is because you want buyers to view it as their potential home. When a potential homebuyer sees your family photos hanging on the wall, it puts your own brand on the home and momentarily shatters their illusions about owning the house.

Therefore, put away family photos, sports trophies, collectible items, knick-knacks, and souvenirs. Put them in a box. Rent a storage area for a few months and put the box in the storage unit.

Do not just put the box in the attic, basement, garage or a closet. Part of preparing a house for sale is to remove "clutter," and that is the next step in preparing your house for sale.

Removing Clutter, Though You May Not Think of it as Clutter

This is the hardest thing for most people to do because they are emotionally attached to everything in the house. After years of living in the same home, clutter collects in such a way that may not be evident to the homeowner. However, it does affect the way buyers see the home, even if you do not realize it. Clutter collects on shelves, counter tops, drawers, closets, garages, attics, and basements.

Take a step back and pretend you are a buyer. Let a friend help point out areas of clutter, as long as you can accept their views without getting defensive.

Kitchen Clutter

The kitchen is a good place to start removing clutter, because it is an easy place to start. First, get everything off the counters. Everything. Even the toaster. Put the toaster in a cabinet and take it out when you use it. Find a place where you can store everything in cabinets and drawers. Of course, you may notice that you do not have cabinet space to put everything. Clean them out. The dishes, pots and pans that rarely get used? Put them in a box and put that box in storage, too.
You see, homebuyers will open all your cabinets and drawers, especially in the kitchen. They want to be sure there is enough room for their "stuff." If your kitchen cabinets, pantries, and drawers look jammed full, it sends a negative message to the buyer and does not promote an image of plentiful storage space. The best way to do that is to have as much "empty space" as possible.
For that reason, if you have a "junk drawer," get rid of the junk. If you have a rarely used crock pot, put it in storage. Do this with every cabinet and drawer. Create open space.

If you have a large amount of foodstuffs crammed into the shelves or pantry, begin using them – especially canned goods. Canned goods are heavy and you don’t want to be lugging them to a new house, anyway – or paying a mover to do so. Let what you have on the shelves determine your menus and use up as much as you can.

Beneath the sink is very critical, too. Make sure the area beneath the sink is as empty as possible, removing all extra cleaning supplies. You should scrub the area down as well, and determine if there are any tell-tale signs of water leaks that may cause a homebuyer to hesitate in buying your home.

Closet Clutter

Closets are great for accumulating clutter, though you may not think of it as clutter. We are talking about extra clothes and shoes – things you rarely wear but cannot bear to be without. Do without these items for a couple of months by putting them in a box, because these items can make your closets look "crammed full." Sometimes there are shoeboxes full of "stuff" or other accumulated personal items, too.

Furniture Clutter

Many people have too much furniture in certain rooms – not too much for your own personal living needs – but too much to give the illusion of space that a homebuyer would like to see. You may want to tour some builders’ models to see how they place furniture in the model homes. Observe how they place furniture in the models so you get some ideas on what to remove and what to leave in your house.

Storage Area Clutter

Basements, garages, attics, and sheds accumulate not only clutter, but junk. These areas should be as empty as possible so that buyers can imagine what they would do with the space. Remove anything that is not essential and take it to the storage area.

Fixing Up the House Interior

Plumbing and Fixtures

All your sink fixtures should look shiny and new. If this cannot be accomplished by cleaning, buy new ones where needed. If you don’t buy something fancy, this can be accomplished inexpensively and they are fairly easy to install. Make sure all the hot and cold water knobs are easy to turn and that the faucets do not leak. If they do, replace the washers. It is not difficult at all.

Check to make sure you have good water pressure and that there are no stains on any of the porcelain. If you have a difficult stain to remove, one trick is to hire a cleaning crew to go through and clean your home on a one-time basis. They seem to be wonderful at making stains go away.

Ceilings, Walls and Painting

Check all the ceilings for water stains. Sometimes old leaks leave stains, even after you have repaired the leak. Of course, if you do have a leak, you will have to get it repaired, whether it is a plumbing problem or the roof leaks.

You should do the same for walls, looking for not only stains, but also areas where dirt has accumulated and you just may not have noticed. Plus, you may have an outdated color scheme.
Painting can be your best investment when selling your home. It is not a very expensive operation and often you can do it yourself. Do not choose colors based on your own preferences, but based on what would appeal to the widest possible number of buyers. You should almost always choose an off-white color because white helps your rooms appear bright and spacious.

Carpet and Flooring

Unless your carpet appears old and worn, or it is definitely an outdated style or color, you probably should do nothing more than hire a good carpet cleaner. If you do choose to replace it, do so with something inexpensive in a fairly neutral color.

Repair or replace broken floor tiles, but do not spend a lot of money on anything. Remember, you are not fixing up the place for yourself. You want to move. Your goal is simply to have as few negative impressions upon those who may want to purchase your property.

Windows and Doors

Check all of your windows to make sure they open and close easily. If not, a spray of WD40 often helps. Make sure there are no cracked or broken windowpanes. If there are, replace them before you begin showing your home.

Do the same things with the doors – make sure they open and close properly, without creaking. If they do, a shot of WD40 on the hinges usually makes the creak go away. Be sure the doorknobs turn easily, and that they are cleaned and polished to look sharp. As buyers go from room to room, someone opens each door and you want to do everything necessary to create a positive impression.

Odor Control

For those who smoke, you might want to minimize smoking indoors while trying to sell your home. You could also purchase an ozone spray that helps to remove odors without creating a masking odor.

Pets of all kinds create odors that you may have become used to, but are immediately noticeable to those with more finely tuned olfactory senses. For those with cats, be sure to empty kitty litter boxes daily. There are also products that you can sprinkle in a layer below the kitty litter that helps to control odor. For those with dogs, keep the dog outdoors as much as possible. You might also try sprinkling carpet freshener on the carpet on a periodic basis.

Costs of Repairs

Do not do anything expensive, such as remodeling. If possible, use savings to pay for any repairs and improvements – do not go charging up credit cards or obtaining new loans. Remember that part of selling a house is also preparing to buy your next home. You do not want to do anything that will affect your credit scores or hurt your ability to qualify for your next mortgage.

Fixing Up Outside the House

Most advice tells you to work on the outside of the house first, but unless there is a major project involved, we believe it is best to do it last. There are two main reasons for this. First, the first steps in preparing the interior of the house are easier. They also help develop the proper mind set required for selling - beginning to think of your "home" as a marketable commodity. Second, the exterior is the most important. A homebuyer’s first impression is based on his or her view of the house from the car.

So take a walk across the street and take a good look at your house. Look at nearby houses, too, and see how yours compares.

Landscaping

Is your landscaping at least average for the neighborhood? If it is not, buy a few bushes and plant them. Do not put in trees. Mature trees are expensive, and you will not get back your investment. Also, immature trees do not really add much to the appearance value of the home.

If you have an area for flowers, buy mature colorful flowers and plant them. They add a splash of vibrancy and color, creating a favorable first impression. Do not buy bulbs or seeds and plant them. They will not mature fast enough to create the desired effect and you certainly don’t want a patch of brown earth for homebuyers to view.

Your lawn should be evenly cut, freshly edged, well watered, and free of brown spots. If there are problems with your lawn, you should probably take care of them before working on the inside of your home. This is because certain areas may need re-sodding, and you want to give it a chance to grow so that re-sod areas are not immediately apparent. Plus, you might want to give fertilizer enough time to be effective.

Always rake up loose leaves and grass cuttings.

House Exterior

The big decision is whether to paint or not to paint. When you look at your house from across the street, does it look tired and faded? If so, a paint job may be in order. It is often a very good investment and really spruces up the appearance of a house, adding dollars to offers from potential homebuyers.

When choosing a color, it should not be something garish and unusual, but a color that fits well in your neighborhood. Of course, the color also depends on the style of your house, too. For some reason, different shades of yellow seem to illicit the best response in homebuyers, whether it is in the trim or the basic color of the house.

As for the roof, if you know your house has an old leaky roof, replace it. If you do not replace a leaky roof, you are going to have to disclose it and the buyer will want a new roof, anyway. Otherwise, wait and see what the home inspector says. Why spend money unnecessarily?

The Back Yard

The back yard should be tidy. If you have a pool or spa, keep it freshly maintained and constantly cleaned. For those that have dogs, be sure to constantly keep the area clear of "debris." If you have swing sets or anything elaborate for your kids, it probably makes more sense to remove them than to leave them in place. They take up room, and you want your back yard to appear as spacious as possible, especially in newer homes where the yards are not as large.

The Front Door & Entryway

The front door should be especially sharp, since it is the entryway into the house. Polish the door fixture so it gleams. If the door needs refinishing or repainting, make sure to get that done.
If you have a cute little plaque or shingle with your family name on it, remove it. Even if it is just on the mailbox. You can always put it up again once you move. Get a new plush door mat, too. This is something else you can take with you once you move.

Your Home should now Look as Good as New and Ready for the Buyer's Eye!!

Understanding Market Conditions & Pricing your Home

To effectively determine what the current market conditions are and set a marketable price for your home, you'll need to take a look at three important pieces of information: 1. Comparable homes that are currently offered for sale in your area; 2. Comparable homes that are under contract in your area but have not yet closed; and 3. Comparable homes in your area that have recently closed.

Homes for sale will tell you a lot about what options Buyers presently have in the marketplace. They are not a strong indication of value, since Sellers are able to ask whatever they want to for their home. If there are many comparable homes available in your area, you may want to consider more aggressive pricing to give yourself a slight edge over your competition. If Buyers have few choices in the marketplace, and especially if your home has more upgrades and amenities than the other homes, you may want to price at the market or slightly above it to ensure that you get top dollar for your home. Take a drive around the area to look at the other homes available. How do they compare to your home? If there are open houses in your area, go ahead and stop in to look at the interior. Be upfront with the agent or owner and let them know you're thinking about selling and just want to look around. You may use my name with other agents, and tell them you're working with me if you'd like to avoid a heavy sales pitch.

Homes that are under contract in your area will give you an idea of what asking prices are encouraging Buyers to make offers. Other factors, such as days on the market and listed amenities will also give you a good indication of market conditions.

Comparable homes in your area that have recently closed is the one true way to determine the accurate value of your home. This is the only data that appraisers give significant weight to when they evaluate a home for a lender. Our market here in Anchorage has leveled out in the past few months, so a good rule of thumb is that your home is worth about what the most recent sale of the most comparable home went for.

How do you get all this information? Why, me of course. It's part of the FSBO Support Package. Click here and I'll send you a current printout from our Multiple Listing Service showing everything you'll need. As always, there's no obligation. Just please remember the service you've received.

Calculating your Bottom Line

Your first step in calculating what you'll net from your sale is to set a realistic price for your home. Please know that the amount you want to get from your home has absolutely no bearing on your home's value. Reverse-engineering your asking price based upon what you want to net will bring you nothing but heartache.

In a sale with conventional financing in Anchorage, Eagle River, the MatSu Valley, or Girdwood, the Seller is traditionally responsible for the following costs:

- Real Estate Commission (6%-8% of the selling price)

- 1/2 of the Recording Fee (about $50 each side)

- 1/2 of the Escrow Closing Fee (about $0.50 for every $1,000 of the sales price over $50,000, plus $100)

- The Owners Title Insurance Policy (about $3 for every $1,000 of the sales price over $100,000, plus $582)

- The Tax Registration Fee (about $76)

- Appraisal ($400 - $600)

- Document Prep Fee ($200)

- As-Built Survey ($125)

If we look at a $225,000 sale and cut out the real estate commission, it looks like this:

Sales Price $225,000

Recording Fee $50

Escrow Closing Fee $187.50

Owners Title Policy $957

Tax Registration Fee $76

Appraisal $500

Document Prep Fee $200

As-Built Survey $125

Leaving you with about $222,904.50 before paying off your loan(s). Call your lender(s) for exact details of how to pay off your loan(s) and how much it will be. Subtract that from your selling price net of closing costs, and that's your bottom line!

Marketing and Showing your Home

This is the step that many For Sale By Owners find the most difficult and challenging. Since real estate agents are in the business of networking and marketing homes, their systems are already in place for such techniques as newspaper ads, web sites, flyer distribution, signage, and many other methods of marketing a home. Often, the cost of putting these systems in place for the purpose of marketing a single home can be prohibitive. Let's take a look at a few of the things you should do:

Marketing Suggestions

Online Marketing

As I mentioned at the beginning, I would be happy to Display your Home Information for FREE on my web site, which currently gets about 40 new visitors a day. If you haven't already done so at the beginning, Click Here to enter your property information. There are also many other places online where you can display your home, most of them at a cost. Go to www.Google.com (best search engine on the web!) and type in "FSBO advertising" to get a list of links where this type of marketing is available.

Newspapers

Traditionally the most common way owners market their homes. The Anchorage Daily News allows you to Place your Ad Online and have it run in the print section. If your home is located near Elmendorf AFB, the Sourdough Sentinel (907-561-4772) may be a good place for you to advertise. Many military personnel are looking for off-base housing and often have wonderful purchase incentives available to them. The Frontiersman in Palmer / Wasilla (www.frontiersman.com), the Alaska Star in Eagle River (www.alaskastar.com) and The Local News in Girdwood (907-754-1234) are semi-productive places to advertise your home.

When writing your ad, keep it brief but enthusiastic to catch the reader's attention. Don't be afraid to copy the outlines of other ads that have caught your eye... chances are if it attracted you it will attract others as well. Consistency is the key to newspaper advertising. In order to be sure of reaching the right target audience, your ad will have to be run often.

Signage

Before you run down to the local drug store, keep in mind that a cheap, flimsy looking sign does not convey the quality image that you want. Since most FSBO's who achieve a successful sale find the buyer as a result of them driving by the house, invest some money in a nice looking quality sign that will last longer than the first rain storm. Give careful consideration to the positioning of your sign as well. It should be highly visible from a good distance away in order to encourage potential buyers to drive by.

Brochures / Flyers

With personal computers, desktop publishing is easier than ever before. Put together a professional looking brochure that communicates all the features and benefits of your home. Include a nice picture of your home and touch on items such as proximity to schools, shopping, transportation routes, major employers and recreation areas. Also cover neighborhood amenities, age, appearance, condition, bedrooms, bathrooms, type & style, landscaping, garage, kitchen, family room, laundry, basement, etc.

Don't forget financial information such as price, down payment, projected monthly payments, utility costs, property taxes, and what types of programs you are willing to sell under. A representative from a local mortgage company should be willing to provide you with all the information you'll need about loan programs, interest rates, and how to calculate monthly payments.

Once you have your brochures printed, you need to have a weather-proof information box to attach to your yard sign. Monitor the box and be sure to keep it full. Also pass out copies of the brochures to all your friends, neighbors, area businesses, large employers in the area, and bulletin boards.

Open Houses

A well-staged open house can do a lot to help get your home exposed to the market. Get some directional open house signs, and place them at corners leading to your home from major streets. Make sure you have enough signs... you don't want to bring people in from a major intersection only to lose them because they can't find your house. Make sure the house is bright and cheery for the open. Turn on all the lights and go over your "Preparing your Home for the Buyer's Eye" checklist one more time.

Be security conscious. Remove all valuables and irreplaceable or breakable items from the house prior to your open. Check all door and window locks afterward to ensure that they have not been tampered with. Keep a record of the people who have passed through your home. Unfortunately, a little paranoia is probably prudent in this day and age.

Working with Agents

You will greatly increase your chances of a sale if you offer a 3% commission to agents who sell your home to one of their buyers. The added benefit is that the selling agent in a FSBO transaction usually ends up doing all the work with contracts, ordering inspections, and closing. You'll also be sure to have all the necessary disclosures to protect yourself after closing. If you do decide to work with agents, drop a stack of your brochures off at each of the large real estate offices with the words "Courtesy to agents" or "Agents welcome" on them.

Showing your Home

Once your marketing efforts have attracted an interested buyer, it's time to show your home.

Qualifying

Before you set an appointment, make sure the buyer is looking for what you have. Since you only have one home to sell, it's easy to determine what a buyer's needs are and compare that to what you have to offer. If they need five bedrooms and you only have three, they probably won't be serious about purchasing your home. Also, politely inquire into the buyer's ability to qualify financially... what price range are they looking in and why, do they presently own a home, have they spoken with a lender, do they have a 90% letter, etc. You don't want to waste time showing your home to prospects who can't afford to buy it.

Setting the Appointment

Typically, you are at the buyer's mercy in terms of timing for your appointment, especially if it is a well qualified buyer who has been looking for a while. Be as flexible as possible, but collect the prospect's contact information, including full name and day and evening phone numbers before completing the call. Make a confirmation call a little before the appointment time to remind them and ensure they are going to show up. Ask them if they have seen one of your brochures, and offer to fax one over if they haven't. Again, be security conscious. It is probably not wise for a woman to show a home to strangers without someone else present. That's not intended to be sexist, just cautious. You decide for yourself.

Showtime!

Just as you would for an open house, turn on all the lights and make sure the home is putting its best foot forward. Open the drapes and blinds, turn off the TV, put some soft music on at a low volume, and set the thermostat so it is not too hot or too cold. If you have children, send them to a friend's if possible, or put them on their best behavior. If you have pets, make sure they are out of the house and freshen the air. Make sure all the beds are made, and do a quick pickup throughout.
When the buyers arrive, your home should sell itself. Be friendly and cheerful, and try to make them feel comfortable. Hand them your brochure, and take them on a tour of the property. Show the most appealing parts of your home first. Casually point out the features and benefits, but don't oversell or say inane things like "this is the kitchen". Avoid long complicated explanations of how upgrades were chosen or installed. When finished with the tour, offer to step outside or out of the way so your buyers can discuss what they've just seen.

If they are not interested, they'll probably politely thank you and head for the door. Don't take it personally, the layout or something else about the house probably just doesn't fit their personal needs. If they are interested, you'll know it. They'll stay longer and ask lots of questions. Watch for buying signals and questions like "how much would we need to put down?" or "when would we need to close by?" to give you an indication of their interest. If they do seem interested, don't forget to suggest they buy it! A low pressure question like "Should we sit down and see if we can come to an agreement?" should do the trick.

Negotiation and Contract

Once you have a qualified buyer who is interested in moving forward on your house, it's time to set the terms and conditions for the sale. The process is really quite easy if you have done a good job setting a realistic asking price. If your price is inflated, you've got some tough work ahead of you.

Chances are you'll start out your negotiations in one of two ways; either the potential buyer will present you with an offer, or you'll hear the words "what do we do if we want to buy it?". Whichever way it happens, you can follow the same basic process. Contracts for the sale of real property must be in writing, so be sure you have plenty of forms on hand. Call me or e-mail me if you need some. Here are the "deal points" that most negotiations cover.

Price: Explain to the buyer how you arrived at your asking price. Show them the same data that you looked at to convince yourself, including a recent appraisal if available, MLS printouts showing recent sales and current listings, market activity reports, a list of upgrades to your house, and any other factors you feel may have a positive influence on your price.

Earnest Money: The amount of the deposit that the buyers put up and forfeit if they cancel the contract for reasons not set forth in the contingencies. For existing homes, traditional earnest money is paid by personal check and is usually $1,000.

Timing: Discuss the buyer's objectives - how quickly do they need to move into their new home? Explain what your time frames are and attempt to find middle ground that you can both live with.

Contingencies: Financing is almost always a contingency of the purchase, so make sure your buyers are committed to taking the necessary steps to get theirs in place. In the greater Anchorage metro area, lenders use what is known as a 90% letter. It typically states that based on the information provided by the buyers (i.e. credit report, W-2's, employment, pay stubs, etc.), they are qualified for the purchase price stated in the letter. Final approval is typically subject to the verification of all the information provided, any conditions set forth in the letter, and an appraisal on the property for the contracted price. If your potential buyer does not have this letter, set quick time frames for obtaining it -- 3 days should normally be sufficient. You also need to set a time frame for the buyer to make formal application for their loan. If the buyer does not have a lender, recommend one. If you don't have one to recommend, use mine: GMAC Mortgage. Ask for Brenda Miernyk at 907-273-8307 or 907-441-4222 and mention my name. If the buyer fails to obtain loan approval within a certain time frame (ask the lender what their backlog looks like), most contracts call for the contract to be cancelled, and the buyer's Earnest Money deposit to be refunded in full.

In addition to financing, your potential buyer may be getting the down payment and closing costs for your house by selling another house that they own. In that case, contracts are normally constructed around a 72 hour right of first refusal. That typically means you continue to market the property for sale, and if you receive a better offer your original buyers have 72 hours from your notification to remove the sale contingency.

Repairs: It's an old saying that problems don't kill real estate deals; surprises do. Urge the buyers to perform an independent inspection of the property (done at their cost). If you are aware of defects in the home, you are required by law to disclose those to the buyers via a Property Transfer Disclosure. I highly recommend doing a pre-inspection with your own professional inspector before a buyer even appears on the scene. That way, you'll know what to expect. My Partners section of this site has suggestions for inspection services.

Personal Property: Make sure you make it clear what is included in the sale and what is not. Appliances, special lighting fixtures, window coverings, etc. are often the cause of big misunderstandings.

Costs: Make it clear who is paying for what. If the buyer is asking you to pay some of their traditional closing costs, be exact about what you will pay and what the limits are.

Closing / Possession: Typically in Anchorage, we sign paperwork on our closing day and record the deed the following business day. Possession of the home by the new buyer is typically at recording of the deed. For a plethora of reasons, I advise against allowing the buyers to occupy the home prior to closing. Call me if you want to hear the horror stories.

Conducting thorough negotiations and creating a tight contract will save you from a great deal of problems. If you get stuck or if you have a question, pick up the phone immediately and call me on my cell at 907-727-7653.

Closing and Moving

Closing

Now that you have a written contract, don't drop the ball. You need to stay on top of the transaction on a daily basis to make sure that deadlines are met, title policies are ordered, appropriate inspections and surveys are conducted, deposit checks clear, tests are ordered (well & septic), your loan payoff is ordered, and all other terms and conditions of the contract are being adhered to. Don't make the mistake of becoming complacent... there are a hundred things that can go wrong in every transaction.

Closings in this area are typically conducted by title company escrow officers. Don't forget to set your appointment well in advance (at least a week), especially if you are closing toward the end of a month. At your closing, your escrow officer will have all your documentation prepared for your signature, and will act as your notary wherever necessary. Allow approximately 1/2 to 1 hour for your closing.

Moving

Make sure you get everything out of your old house and that it's thoroughly clean before turning it over to the new buyers. Nothing will sap the joy out of their new purchase faster than walking into a dirty house. Also, be sure to leave all informational booklets on appliances, HVAC systems, etc. where the buyers can easily find them. Don't forget keys (mailbox key too, if applicable), garage door remotes, and any other items the new owners will need. Transfer your utilities, and fill out a change of address form. My site contains a complete Built-In Moving Guide that is an excellent resource for a smooth transition... feel free to browse through all the articles and helpful links!