Sell My House by Owner: How to Make Money Selling Your Home?

Sell My House Fast Without a Real Estate Agent

Welcome again to the second blog of this website. I’m so excited to share more with you. We’re entering a different segment in the real estate industry. We have information and resources available at our fingertips. Buyers are online, and sellers are online. What’s left?

The connection or the matchmaking process. So, you can either hire an agent or sell yourself. Both are complex options. In this blog, we’ll focus on FSBO.

How do I sell my house by owner while saving money? This question appears a lot in the real estate industry. I will try to provide a comprehensive answer to this question. We’ll cover details like:

How can I sell my home by myself?
Is selling your home by owner a good idea?
How easy is it to sell a house by owner?
Marketing tips to sell your house fast
Pitfalls to avoid when selling home by owner

How Easy Is It to Sell My House by Owner?

It’s as easy as convincing the buyer!

Please don’t get me wrong. Selling a home by owner is easier than you’re thinking. You just need to shift your perspective. Right now, you’re feeling like a seller: how do I sell my house fast? How can I present my house in better condition? How much will I get for my property?

You need to think like a buyer.

How can I buy a house with poor credit?
How can I get pre-approved for my mortgage?
How can I find a home that doesn’t require too many repairs?
How can I find a suitable location?
How can I find a friendly seller who has taken care of the property?

Asking these questions will put you in a better position. Now, you know what your potential buyer is thinking. You need to address those concerns to sell your house fast for the price you want.

Sell My House by Owner: How Can I Save Money?

The whole point of trying FSBO is to save money. I have made a detailed comparison in this article. Here, you can find out how much money you can expect to save if you sell without an agent. Most people think that they will save 6% of the sales price. However, our calculations showed that the actual saving is around 2.5%.

In this article, we’ll expand the discussion. We want to save more money. We want to make more money by selling our home in our local market. We’re not talking about overpricing a property. However, we want a fair/genuine price. You can receive a reasonable price in multiple ways. We’ll speak of cost-effective marketing and other strategies.

Create a Website with a Homepage that Sells

A good start is creating a website that features a home page that sells your home. You must ensure that your home page has a clear call to action (CTA) that tells visitors exactly what they need to do next.

Build Your Real Estate Home Website

This might surprise you, but this strategy works. So let’s step back into the buyer’s shoes and see what your potential buyer is doing.

Location always comes first. Your buyer is not searching for your property. The prospective owner is searching for a good location. Let’s say the buyer is searching for a 3-bed house in Florida (Jacksonville, 32244). That’s your house.

Now, what will be the search term? I am talking about the keywords. Your buyer will search online using keywords like:

Homes for sale in Jacksonville, 32244
Houses for sale in Jacksonville, 32244
Homes for sale in Jacksonville, FL

Now let me show you what you can do here.

You go to a domain name provider like Godaddy or some other platform. You reserve your domain name: homesforsalejacksonville32244.com.

Yes, your domain name will have the entire keyword plus the zip code of your city/neighborhood. The cost of this domain name will be around $10 for a year. We won’t need it any longer after the sale.

Next, you’ll use the same domain name provider to host your name. Then, you can use the free hosting plan to host your newly created website. There is no need to use a separate host. I don’t want you to spend more money on this website—just the $10 for your real estate domain name registration.

Most domain name providers will give you a free 1-page website hosting plan. You can use that page to create your real estate property listing. Create your real estate listing. Talk all about your property. You’re not restricted by space or word count. Add your professional photos and click publish.

Your real estate website is ready! I hope it doesn’t sound complex. If you have any questions, let me know, and I will try my best to answer.

There is one thing left. We need to ask uncle Google to index this website so we can rank on the first page for our keyword. This website might help.

You must log in to your Google account and fetch your website as Google. This link will take you to the right page, where you can ask Google to bring the website. Afterward, it will be shortly indexed and will start ranking in 2–3 days. Of course, that’s not the fastest way to advertise your home. However, it’s a unique way to rank on Google and precedes all online searches related to your zip code.

Add Photos and Videos

If you’re selling a house, you’ll probably want to add some photos and videos to your site. These will help potential buyers visualize themselves living in your home.

Include a Map

A Google Map is one of the easiest ways to show off your property’s location. It also makes it easier for people to find directions to your house.

What’s the next way to save money if you want to sell your home by owner?

Work with Buyers With a Poor Credit Score

The approximate cost of selling a home in the US is around 20%. Here is a breakdown of the cost:

5%–10% price negotiation
5% repairs
2% closing costs
6% realtor commissions

You can set a selling price, but you need room for negotiations. You can expect to reduce the listing price unless you’re in a hot seller’s market. Repairs are also part of the journey. You might have to make repairs before listing your home or before closing. The same goes for commissions and closing costs. Now, when you sell by owner, all these costs remain the same except the commissions. Your commission will be 3%.

However, you can save a lot of money if you offer owner-financing. That’s not necessarily the easiest road, but it works.

How does Owner Financing Work for Me?

Owner financing deals are for individuals with a low credit score. Life happens; sometimes, unfortunate circumstances lead to a low credit score. Now banks won’t lend you money if your credit score is below 600. In the ideal scenario, your perfect score should be 800. Now, how will you buy a house without a mortgage?

You will search for owner-financed deals. You’ll find a seller who is willing to work with you. However, there won’t be price reductions because the seller is accepting a risk.

Here is the structure of an owner-financed deal:

Down payment: 15%-20%
Interest Rate: Fixed
Repayment Term: 5 Years

Suppose your home’s value is $200,000. The buyer is willing to make a down payment of 15%. That’s $30k. So, you’ll lend $170k at a fixed-interest rate of 8%. The buyer will make monthly mortgage payments, but a balloon payment will be due in the next five years. During that time, the buyer must improve their credit score to qualify for a traditional mortgage.

The sale happens through a “deed transfer.” You will retain the title of the property. In the event of non-payment, you can foreclose the property.

You do need to meet certain conditions if you want to offer owner financing:

Your home needs to be clear & free. Most mortgage companies will object to owner financing.
You need to be familiar with local foreclosure laws and have an attorney review the documents.
You must have time because you won’t recover your investment until the next five years. However, you’ll be earning an interest rate over the years.
There can be tax implications. A slight chance exists that the buyer might damage the property.

Rent-to-own is a more popular option than owner financing. However, the terms are similar. So now, what are the pros of owner financing? We’re discussing owner financing to see how much we can save if we sell by owner.

So if you sell your home by owner and offer owner financing:

You don’t have to lower the price of your home. Instead, you’re offering a unique opportunity to buyers with a low credit score.
You don’t have to pay any commissions. The deal is between you and the buyer.
You might (should) have to hire an attorney for proper legal documentation.
You earn an interest rate.
You don’t have to make expensive repairs. In many cases, you can sell your home as-is.

Now, let’s count the savings. First, you don’t have to negotiate the price. (5%–10% savings compared to traditional sales). Second, you don’t pay a commission. (6% saving). Third, you can avoid repairs (almost 5%). That’s a 15%–20% savings plus the interest rate. Given the amount, owner financing might be worth the risk.

How to Pre-Qualify Buyers for Your Sale?

You’re going to sell your home without a realtor. So we need to screen potential buyers. It doesn’t matter if you’re using owner-financing or not.

Here is how you go about it:

You need to invite people to your open house event. Then, people can visit your home and come to their conclusions, so you don’t have to share every bit of information upfront.

Let’s say a buyer calls you. You talk about the number of bedrooms, location, and some features. Don’t reveal more than that. Invite them to the open house and build curiosity. You need to take the lead here, and the easiest way is to ask questions.

Ask if the buyer needs help with financing. (Very important if you’re offering owner-financing.)
Ask when you need to move out
Where do they live, and what’s their current mortgage payment?
Ask about the downpayment
Maybe tell that you’re concerned about the credit score. But, you want to work with good people.

You want to sell your house fast. You know what timeline works for you. When you ask about the moving date, you’ll get an idea of the buyer’s timeline.

Asking about the current mortgage payment, property tax, and downpayment gives you an idea of the financial capabilities. Can the buyer afford your house? You need a sounding yes for this question. If not, keep searching for more buyers.

Find Out What’s Selling In Your Area

If you’re looking to sell your house fast, you’ll want to find out what homes are currently listed for sale in your neighborhood. This will help you determine whether your home is worth listing at its current price or whether you should lower the asking price.

How Much is My House Worth?

Let’s do a CMA (Competitive Market Analysis). Here is what you’ll need:

Recent sales data in your area/neighborhood
Comparable houses (similar number of bedrooms, covered area, lot size, and construction times). Take note if these homes were updated within the last 2 years.
Market trends: Are local sales going up or down?
Special features of your property

You can find recent sales information on websites like Zillow. Please ignore homes that are currently listed for sale. Here are some ways to understand the value of your home.

Home Appraisal:

A home appraisal costs $300–$600. You can hire a professional appraiser to look at your property and give you an estimated price. You can also post this appraisal price so that people know you’re selling for a reasonable price.

Investor Cash Offer:

Want to know how much your home is worth? Get a cash offer from a “we buy houses” company in your area. You might have seen “sell your house fast” signboards in your neighborhood.

I am not asking you to work with an investor. Instead, we’ll do some calculations with the cash offer to understand how much your home is worth. You might want to check this article: should I sell my house to an investor?

Let’s say you receive a cash offer worth $140,000 from a real estate investor in your area. Real estate investors don’t offer more than 70% of the final sales price. So, in that case, you can sell your home for $185k–$200k after making repairs and updates. You can find more calculations here.

Repairs, Home Staging, and Professional Photos

I will not vote for a DIY approach here. However, if you want to sell your house fast, you need an adequately updated & cleaned property. In addition, you need the best photos for online marketing.

Choose a professional marketing company that can help with this task. It will cost you a few hundred dollars, but it will give a professional touch to your listing.

Craigslist & FSBO Websites:

You want to sell your home by owner, but we can’t ignore the popularity of MLS. Therefore, we will need to list our property on the local MLS. Fortunately, FSBO websites give you access to this platform.

You have the photos and the website. Now you can publish your listing.

Another popular platform is Craigslist. It pays to post your listing on Craigslist. However, it’s a crowded platform. So you will have to pre-qualify buyers.

Sell Your Home Without a Realtor

We’re reaching the end of this post, but I want to share two more tips with you:

First of all, you can choose to hire an agent for a discounted price if you need help at any stage. You can also hire an attorney to review the documents and help with negotiations.

Second, you can offer a competitive buyer’s agent commission. Now that seems counterintuitive. Most people will avoid paying a higher commission. However, that’s an important marketing strategy. You don’t want your property to sit on the market. You want to sell your house fast for a good price. Now, let’s answer the question:

Why should a buyer’s agent work with you? Because:

They are searching for a suitable property for their client.
They want to earn a commission.

Let’s give them an incentive to sell your home. Even a 0.1% increase in buyer’s agent commission will make your post stand out.

I hope this post was helpful. Any questions or comments? Please let me know and I will be happy to help you. Selling your home by owner is a learning journey. You are learning about market conditions, prospective buyers, negotiations, paperwork, and marketing. You get to sell your home yourself and you have more control over the process. Stay optimistic, maintain a professional tone and communicate with buyers. Some buyers (and their agents) are hesitant about working with homeowners. You can eliminate their worries by welcoming their agent and maintaining top communication. And please don’t worry: A few weeks down the road, you’ll look at this journey with surprise. You’ll sell your home successfully and will also gain from this experience.