Did you know the average commission rate in Tennessee is 5.2% to 6.0%? To put that into perspective, if you were to sell your house for $200,000, you would be looking at paying up to $12,000 in commissions, leaving you with fewer profits.
Selling for sale by owner is a great option if you’re looking to save some money. However, you’ll need to be prepared to put some time and effort into the process.
That’s not to say Listing For Sale By Owner (FSBO) doesn’t have its downsides too. Research has shown that selling by owner can affect the price, even selling for 6% less than those listed with a realtor. Furthermore, houses listed by owner take longer to sell and are more likely to fall out of contract after accepting an offer- that is, unless the owner is experienced and knowledgeable about the process.
In this article, we’ll share the complete checklist for selling FSBO, so that way you’re prepared to make a successful home sale by yourself.
Checklist To Sell Your House FSBO In Memphis, TN
What Is FSBO?
A good place to start is figuring out what is FSBO? FSBO stands for For Sale By Owner and means selling without a listing agent. When selling without a realtor, you’re in the driver’s seat and in charge of the entire listing process. By selling a house on your own in Memphis, you’ll be able to save potentially 2.5%-3.0% in commissions that would otherwise go to your listing agent.
But why not the full 5.2% to 6% mentioned above? If the prospective buyer uses an agent, half of the commission goes to their agent’s commission—something to keep in mind since you’ll be handling a majority of the selling process.
Although, selling by owner does have some key benefits include:
- Direct control over the sale of your home, including pricing strategy, showing schedule, and negotiating
- No listing commission, possibly saving you 3%
- If you were to find a buyer without an agent, you could save an additional 2.6%
Set FSBO Expectations for Selling
First, make sure to ask yourself, “is it the right time for me to sell in Memphis?’ You want to be emotionally ready to do this before proceeding. If the answer is yes, you’re prepared to do this; the next step will be to set realistic expectations for selling by owner. This will help you to prepare for market trends and learn more about the sales process in Tennessee.
Setting FSBO expectations around the sale process will help you decrease the time to close and hopefully result in more offers on your listing. What’s more, it can help you see if selling your house by yourself in Memphis is actually right for you.
The biggest thing you need to learn about is Tennessee state laws and regulations regarding selling by owner.
Below is an overview of Tennessee FSBO rules and regulations:
|Real Estate Attorney Required?||No|
|Required state disclosures?||Residential Property Condition DisclosureFlood Zone StatementLead-Based Paint DisclosureWaiver for Buyer to Forgo Their Right to Disclosures|
|FSBO yard sign allowed?||Yes|
|Competitive Buyer’s Agent Commission||2.4% to 2.8%|
Calculate Property Pricing
Once you know what’s required of you by the state to sell by owner, you’ll need to calculate your property’s value. This tends to be a challenge for most homeowners. Price too high, and you’ll end up sitting on the market for weeks or months, price too low, and be at risk of leaving money on the table.
So you’ll want to be honest about your list price; look at recent sales data in your area on real estate websites to find an accurate price point for homes of comparable size and condition to yours. Many real estate companies will also offer to do an analysis, for little to no charge; however, most do so with the expectation that you’ll list with them.
Thankfully the Memphis real estate market has been doing well, so you should get a decent price for your house.
→ Selling a mobile home in Memphis? Learn how to determine it’s value by clicking here.
Get Your House Ready for Showings
The next step of the FSBO process is to get your house ready to list. You’ll need to be prepared for house showings, so you’ll want the place to look clean, organized, and inviting. This is also when you should make minor repairs on your home including, touching up paint, replacing light bulbs, tightening loose door handles, and replacing anything that’s been cracked or broken.
If it’s been a while since the place was updated, you may want to consider redecorating your house. You don’t have to do anything major, but if you have any bright or bold wall colors, changing them to something more neutral usually helps. If you have any old carpet that’s red or blue and has seen better days, you might want to consider getting that replaced or at least professionally cleaned. Updating faucets and light fixtures isn’t overly expensive and will help the house look more up-to-date.
Cleaning, fixing minor repairs, and redecorating will help to show your home to potential buyers and will be great for listing photos.
Create and Plan Your Marketing Strategies
Next up, creating and planning your marketing strategy. Figuring out a marketing plan is one thing, but executing it may prove to be a challenge.
Firstly, you’ll need to figure out a listing description that speaks to local buyers. You’ll want to understand their priorities to help you figure out what features of your home to highlight in your listing and to help attract more interest.
You’ll then want to hire a professional photographer so that your great listing description has incredible photos to go with it. These two things are ever important to have when selling by owner in Memphis because most buyers start their home buying search, you guessed it, online.
So not only do you want to have great info and photos for people to see but also be able to see it on multiple sites—the more eyes on your listing, the better and the higher the chances of getting an offer. So make sure to advertise your home online on FSBO sites, Facebook, Craigslist, Instagram, and with a Flat-Fee MLS company. Don’t forget to get a nice For Sale By Owner yard sign, too, so that anyone driving through your neighborhood can give you a call about your listing.
Open House Preparation
Hosting open houses is a great way for people shopping for a home to come by and take a look at your place. You’ll want to block off a Saturday or Sunday afternoon to open your home to visitors and do some open house preparation before. Similar to showings, you’ll want to have the house clean and tidy.
Besides cleaning your entire house and bathrooms, you’ll want to dust, sweep, mop and vacuum. Don’t forget to clean windows, mirrors, and any high contact places since you’re selling during COVID-19. Make sure to mow the lawn, weed flower beds, and trim any hedges if you haven’t already.
You’ll also want to have the backyard free of toys or bikes and straighten up the garage or carport. Right before the open house, make sure to open all the blinds or shades and turn all the lights on in the house. Adding some potted plants by the front door and a vase of fresh flowers inside is a nice touch. Even baking some chocolate chip cookies is a great way to make the house smell amazing and to have a little treat for people walking through the place.
Price Negotiation with Home Buyers
Hopefully, once you get to this point, you’ve received an offer and need to go to the negotiation table. Negotiating with home buyers is all about offers and counter-offers because it is rare that a homeowner and a buyer agree on a price in the beginning.
Make sure to ask the potential buyer for their pre-approval status to verify they are qualified to buy your home.
Using the market info you researched earlier to determine your listing price, you’ll know the high and low range to accept a fair offer on your house or provide a counter-offer. Making a counter-offer doesn’t jeopardize the sale but gives you a chance to advocate for the value of your home. If your property is priced competitively according to your research, then it will be easy to see the value in your counter-offer.
After you negotiate and accept an offer, inspections will be completed. This may lead to renegotiating the price to account for a leaky roof, a foundation issue, or termite damage. These details will need to be worked out to complete the closing of a house sale.
Closing the house sale will require planning to avoid costly delays and precious time. The biggest step is to make sure that the property is inspected and repairs are completed. Also, you’ll want to add to the closing FSBO checklist: finding a tile company, opening escrow, depositing earnest money, and cleaning up. Typically the closing process can take 30-60-days.
By now, you’ve likely figured out that selling by owner will not be easy, especially if you’re not an experienced home seller. You’ll just have to be prepared and able to dedicate a lot of time and effort to make the sale a success. Ultimately, if you’re saying, “I need to sell my house fast in Memphis”, you’ll want to look for a We Buy Houses company to purchase your home. They’ll be able to quickly buy your house without you having to deal with the hassle of listing FSBO.
Selling to a local cash home buyer like Fair Cash Deal will also save you money. If selling by owner appeals to you because of the savings- Fair Cash Deal doesn’t charge real estate commissions (listing agents or buyer’s agent) and will even help pay closing costs. This will save you thousands of dollars and the trouble of listing by owner.
Finally, Fair Cash Deal buys houses in as-is condition, so not only will you be able to sell directly to them without listing your home, you will be able to avoid expensive repairs, and the time it will take to complete them. Their easy home buying process also includes a cash offer within 24-hours and the ability to close within 7-days or longer if needed.
However, you end up selling your home, you now have a general idea of what selling your FSBO in Memphis looks like and what it will take to make a successful home sale. Hopefully, this FSBO Checklist will help you along the way!