When I came into the business I was not a licensed Realtor, and I did not want to use a Realtor to sell my property. Now, I am a Realtor and I do sell my properties and the properties of my investment companies and Joint Ventures. That said, as an owner, you can list your house as For Sale By Owner (FSBO). An FSBO allows you the ability to not have to pay commission and do the work yourself. Now whether that is a great idea or not is not why we are here. We are here to help guide you down the path of success if you do choose to list your own property. Here are 6 simple steps to make it happen.
- Plan Ahead
- While this seems like it is not a big deal it really is, and if you don’t put together a plan and just think people will show and be interested you will be rudely awakened. The first thing I recommend is you walk the home with a 3rd party, somewhat who has not poured their heart and soul into the process. Ask them their thoughts, and then ask them to be honest with you and really tell. Many times you will see that what you envisioned is not hitting just right with the the potential buyers, remember they do not know how bad the property was and what you have done. This means the compromises you made won’t be clouding their judgement and issues of the houses will show up to them, that won’t show up to you. This is a big part of growing in Real Estate and understanding that you can not fix every issue a home may have, but the ability to recognize, and minimize the devaluation is crucial in getting maximum dollar. A huge way to minimize this is in the next section
- Stage the Property
- Staging a property is the act of placing furniture and other items you might find in a home through out a house, here is an example from a property I have completed and staged. When you look at this photo you see that the home looks as if it is lived in. The staging company I worked with here set up the room to feel as if someone does or could live in the home. This goes all the way down to the knick knacks on the table, and in other rooms the art on the walls. Although there are many small items used to pull this together you will notice it does not look cluttered. A crucial portion of the staging is that it shows how a room can be used and that it does not make the space seemed confined. Additionally it must not be too personal, as the buyers need to be able to envision themselves in the property and that they could live there, not that it is someone else’s home. (Here is video on design and how I get conversations going at open houses.)
- Use a listing Service
- How are people going to figure out that your home is for sale? One way is by going through a listing service or website. There are several listing services out there that are free, Zillow, Redfin, Craigslist, etc. They are all great but the real name of the game is the local Multiple Listing Service (MLS) in your local area. What is the MLS you ask? The MLS is the service that Realtors use to show their listings to other Realtors, who in turn bring their buyers.There are a few ways to get your property on the MLS. 1. List with a Realtor, that said this article is about FSBO. 2. Get an “Entry Only” agent to list your house on the MLS. They will not represent you but they will list it so Agents see it online and can bring you buyers. You will have to pay a buyers agent fee to the agent that brings the buyers to you, and that is generally set around 2-3%. I recommend offering 2.5% to the agent, this is fairly common in the industry as of right now.
- Invite Fellow Investors
- The more people you invite to your open house the more activity you will have while you are throwing it. Thinking about any time you buy something, if you are concerned that it may not be there in the future you are more likely to act quickly to buy it. The same goes for the purchase of a home. If your potential buyers walk into a house with 10 people in it viewing the property they are more likely to place value on the home as being “Hot” and possibly not lasting long. This mindset will get them to move more quickly in making an offer. Additionally the more projects you can bring your local investors into the more opportunities you will get to mingle with people in your local Real Estate Investing market. This might mean getting to know another lender, or cheaper escrow or finding a possible joint venture of wholesale deals. The possibilities are endless when you actively go network in the community.
- Have Refreshments
- Many people forget to spice up the party when they are throwing an open house. I personally like to throw a large open house for each property when it comes on market. It is generally a party to network and show the house at the same time. We will serve little appetizers and drinks to everyone who comes through. It allows for group conversation and interaction that is unlike any other when it comes to selling.On top of that you get to show the property off to potential lender and JV partners. It also offers an exciting environment for a potential buyer to walk into and meet the developer first hand.
- Tell the Neighbors
- Who are the most interested parties in your home? Outside of the future owner it is the neighbors! The house you just rehabbed was likely a black eye to the neighborhood, now it is a gem. In many neighborhoods the neighbors know if their friends were wanting to get into the same neighborhood, and there is no way for you to know that unless you let them know that you are having an open house. In my book, Flipping Your Thoughts on Flipping (FREE COPY HERE), I discuss talking with the neighbors early on to let them know what you are doing. If you have done this you will have their contact number and can reach right out to them for the invite. Communicating with neighbors can be huge, I have sold a property before I listed it because the neighbor got their friend in before I completed work! Saving me time on holding costs, and making more money for us in the end.
Overall the most important part of an open house is making sure you are throwing them to showcase your product and that you are carrying pride through the process. It is your hard work, money and sweat that made the deal possible. If you put the same dedication into the open house and marketing you will reap the same result. Whether that result is positive or negative is up to you and your effort.
Andrew T Greer
CEO Better Tomorrow Group
Andrew is an active investor, speaker, Realtor, serial entrepreneur, and educator in all that is Residential Real Estate. If you would like a FREE copy of his book follow this LINK. If you would like to follow him on Social media you can find him on Instagram @beastmoderealestate and @bettertomorrowgroup on Twitter/Periscope @TheBTGRoup and Facebook at Better Tomorrow Group.