The housing boom that won't quit is likely to keep cruising. And if houses are selling easily in your neighborhood, that's a strong argument for trying to sell without the pricey help of a real estate broker.
If you're nervous about hanging out a "For Sale By Owner" sign -- known as a FSBO or "fizzbo," for short -- remember that going this route is not irrevocable, notes Robert Irwin, author of the newly revised The For Sale by Owner Kit (Dearborn Trade Publishing, $17.95). "I always recommend trying a fizzbo before listing with an agent," he says. "Hang a sign out front for 30 days and see what happens. The guy next door may want it."
You could save a bundle -- say, $15,000 on a $250,000 home, assuming a typical broker's commission of 6% of the sale price. The key to success is sharing your savings with the buyer. "You've got to sell at least a little below market value," Irwin says. "A fizzbo is always selling at a disadvantage because buyers prefer dealing with agents. You have to give people a reason to come to you." Irwin, who spent 20 years as a real estate broker, offers these other tips:
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Price the house competitively. Your first hurdle is figuring out what your house is worth. "Take a couple of weeks and become a pretend buyer," advises Irwin. "See what else is out there." This will help you become as keenly attuned to price as real buyers are. Ask an agent for a price estimate. Pros know that most fizzbos eventually list with an agent, and they may be willing to give you a hand so that they're first on your list if that day comes.
Make it fetching. Visiting other houses on the market will help you recognize the cosmetic flaws in your own. Take care of all the little things: Tidy up the landscaping, repaint or replace the front door, clean up the clutter inside and out.
Market it. Get a good-looking for-sale sign made for the front yard, and fliers that display a color photo of your house and list its high points. Buy a small ad in the local newspaper, and note that it's a "FSBO." "The word fizzbo is magic," says Irwin. "Buyers think 'bargain' right away." Set up your answering machine to greet prospective buyers, or forward calls to your cell phone, so you can greet them personally.
Keep your cool. The biggest stumbling block is negotiating with a buyer, Irwin says. "People get excited and pushy when a buyer comes by, and that scares a lot of people off." That could drive a buyer into the arms of a buyer's agent, costing a 3% commission.
Welcome agents. With so many buyers working with agents these days, you may have to agree to pay half a commission fee, anyway. Note on your advertising that you're willing to cooperate with buyers' agents. You really have little choice.
Know your limits. Pay a professional to handle the paperwork. "Make arrangements with an agent or a lawyer in advance," Irwin says. "You want to have somebody who knows what they're doing draw up the paperwork." Expect to pay between $500 and $1,500.
Set a deadline. If you're serious about selling, set a firm deadline for your fizzbo effort, so you don't waste time while your property grows stale. "Whether it's one month, two months or three months, if you haven't sold it in that length of time, go ahead and list with an agent," says Irwin.
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