Step 5: Market the Home
The National Association of Realtors reports that more than 93% of all home buyers use online tools to search for a new home. As such, the vast majority of a real estate agent’s time spent marketing a home for sale is spent on Internet advertising. Given that the Internet is a fast and cost-effective way to reach the majority of prospective buyers, the importance of online advertising cannot be overstated.
The Multiple Listing Service and Realtor.com
Many sellers who are unfamiliar with the “For Sale By Owner” (FSBO) sales process share the mistaken belief that agents are able to market the sale of a home through services that are unavailable to FSBO sellers. In reality, most of an agent’s work in this regard merely consists of listing a home in the Multiple Listing Service (MLS).
The MLS is a database that automatically lists a home in Realtor.com, the premier website that prospective buyers and real estate agents use in their home searches. Once a home is listed in Realtor.com, the listing automatically is sent to thousands of other popular real estate websites around the country, including Trulia and Redfin.
Only a real estate agent can list a home in the MLS and Realtor.com; however, there are many services in which sellers can hire an agent for the sole purpose of listing a home on the MLS. These services, known as flat-fee MLS services, charge a low flat fee (rather than a percentage of the sales price of the home) to handle one or more activities from an à la carte menu of services performed by traditional real estate agents. For FSBO sellers who only need to have a home listed in the MLS, for example, a flat-fee MLS service typically charges between $100 and $200. Flat-fee MLS services thus afford FSBO sellers the opportunity to save tens of thousands of dollars on the sale of their homes by advertising a home in the same fashion as an agent while avoiding high sales commissions. There are many flat-fee MLS services available online, including:
When FSBO sellers list a home on the MLS using a flat-fee MLS service, they should be prepared to provide information on all aspects of the home. Specifically, sellers should list all basic information about the home (sales price, number of bedrooms, number of bathrooms, other prominent rooms, lot size, location, style of home, etc.) as well as those improvements, upgrades, and other factors that allow a home to stand out from others (granite counter tops, stainless steel appliances, over-sized windows, fireplaces, pools, etc.). FSBO sellers also should prioritize featuring photographs of each special feature of the home in the MLS listing, as well as staging a virtual tour of the home.
Other Methods of Advertising
The availability of internet advertising has trivialized the importance of hiring a real estate agent to maximize the exposure of a home. In addition to the exposure provided by the flat-fee MLS services discussed above, sellers should consider all of the following approaches:
- Craigslist. The real estate section of Craigslist allows FSBO sellers to advertise their homes for free, complete with photos, descriptions, maps, and customizable designs.
- Real estate ads in your local newspaper. One of the most effective ways of advertising a home in many communities is to advertise the FSBO property in print publications.
- “For sale signs. “For sale” signs and brochure boxes are useful in helping to capture neighborhood interest and signify the location of the home during showings.
All sellers are required by law to disclose all problems associated with their home prior to sale. Disclosures vary by state, some of which require sellers to disclose more information than others. States typically require sellers to disclose information, however minor (including disclosures made by previous owners), on the following areas of the home:
- The existence of any encumbrances, liens, or other title matters.
- The existence of any special assessments on the home.
- Structural conditions of the home, including information on the roof, fireplace, chimney, basement, walls, floors, insulation, and windows.
- Operational conditions of the home, including the heating system, air conditioning system, plumbing system, and electrical system.
- Potentially defective appliances, including the range/oven, dishwasher, refrigerator, range hood/fan, microwave oven, garbage disposal, sump pump, trash compactor, television antenna, central vacuum, ceiling fan, attic fan, sauna, hot tub, pool heater and equipment, security system, garage door opener, lawn sprinkler system, carbon monoxide detectors, and smoke detectors.
- The presence of exterior or environmental issues, including exterior drainage, damage to the surrounding property, termites or wood-destroying insects or rodents, asbestos, radon gas, lead-based paints and other lead-based hazards, underground storage tanks, formaldehyde, contaminated soil, zoning violations, nonconforming uses of the home, violation of building restrictions or setback requirements, recorded or unrecorded easements, and historic property designations.
FSBO sellers should disclose any damage to the home (and when any such damage occurred) to the extent possible and document all efforts to make repairs. FSBO sellers that do not have records of specific home repairs should consider obtaining a report from Buildfax, which provides detailed information on repairs that were made by licensed contractors, the date of the repairs, and the contractor in charge. A Buildfax report typically costs $40 for a single report or $90 for three months of access.
Disclosure forms are available online at USLegalForms.com and typically sold at local office supply stores. Flat-fee MLS services also will walk sellers through the disclosure process. Once the home is listed for sale, FSBO sellers should have ready access to the disclosure forms to share with prospective buyers upon request.
Step 5 Premium Content
• Proven and Effective Marketing Strategies
• The Contents of MLS Listing Agreements
• Marketing with Social Media and Craigslist
• The “For Sale” Sign and Brochure Box
• How to Design an Effective Sales Flyer
• Creative Marketing Ideas
• State Disclosure Requirements