For sale by owner is a method of selling a house without the involvement of the listing agent. In such a case, the seller takes on the responsibilities that would otherwise fall on their realtor, like pricing the home, scheduling showings, and negotiating.
In a sale that is led by an agent, the homeowner usually pays a commission of around 6% of the sale price, which is divided equally with the buyer’s agent. If a seller opts to sell home by owner, they can do away with the listing agent’s commission.
There are different options to sell home by owner and that too quite quickly. Let’s take a look.
Selling to a Wholesaler or Cash Buyer
Around 40% of all real estate deals that happen in the US involve cash. This means no banks are involved either and thus most traditional roadblocks of underwriting are eliminated.
Wholesalers act as a middleman for your property, though not for top dollar, you do get a decent sum. They have several cash buyers as their partners who tell them the type of houses, they are interested in.
You can sell house as is to these wholesalers who will then put it under contract and flip it to an investor. This is a very quick method to sell home by owner. Most cash buying companies buy distressed houses so if you have a property that is not in great condition and you don’t have the time or money to make the repairs, then you can sell house as is.
WeBuyUglyHouses, We Buy Houses and I Buy Houses are some of the companies that buy houses for cash.
However, it is noteworthy that your house will most likely go for a discounted price.
The iBuyer Option
This is a new online-based way of selling your home without an agent and has been increasingly growing over the past few years. These real estate companies use data and technology to arrive at an estimated value for your property and offer to buy it from you. Several websites like Opendoor, Offerpad, and Redfin are leading iBuyers.
They usually operate in the following way:
- You can sell house as is with these companies. If you directly sell to them then you can close the deal in a matter of days. The companies will take care of the needed repairs.
- If you list with the company, then the iBuyer will find you a buyer.
However, you should ensure that you know everything about the process, the costs involved, the limitations, and other possible caveats. The websites usually operate on a fee-based model, so sellers may save money but not as much as they would when handling everything on their own.
Also, iBuyers have a very stringent purchase criterion. Your home should be in pretty good shape to make the cut.
For Sale By Owner
Technically an FSBO transaction is the same as a traditional real estate deal, minus the service of a real estate agent. These transactions are relatively cheaper than selling with a broker because the homeowners save a lot on the listing agent’s commission.
Nonetheless, an FSBO sale still has some risks and is time consuming. This method will definitely cost you less but if you are going down this route, you will have to accurately price your property, market it, arrange showings and handle all the paperwork on your own.
There are several paid For Sale By Owner websites that let you list your home online, with plans that range from $100 to $400. Whatever site you go with, be mindful of going through the fine print. Some sites might charge hidden fees or take a percentage from the sale price.
You can also create FSBO listings for free on popular websites like Zillow, you would have to post site by site and the listing would not even get the right exposure.
Flat fee MLS companies
Some real estate companies like Houzeo, Flat Fee Group, Beycome, and Homecoin get your listings on the local MLS, which is the best place to be listed to get maximum exposure.
Flat fee MLS companies charge a fixed rate to list your home on the MLS. Typically, only brokers can access the MLS. But, they charge a heavy commission. A flat fee MLS firm is a cheaper alternative to using the services of a traditional full-service broker.
Check out the top Flat Fee MLS Companies in America!
Trade it in
If you are looking to sell your home and buy a new home, an option is to work with an entity that is ready to trade in your existing house in exchange for a new one. Some examples of such companies are Knock and Opendoor. These companies will purchase your existing house, sell it for you and use that sum to help you finance your new house.
However, this option is only available in select markets and with select builders. Also, you might not make as much money as on the open market.