How to Sell a Home on Your Own in Texas: FSBO Guide

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How to Sell a Home on Your Own in Texas: FSBO Guide

Do you really need a realtor to sell your home in Texas? It’s tempting to bypass a real estate agent and sell a home on your own, especially in a hot housing market. If all goes according to plan, sellers could save thousands in agent fees. As is most everything, though, it’s not that straightforward. To successfully close the sale of your own house, Texas homeowners need to prepare for the stressful and turbulent road ahead and this step-by-step guide gives homeowners considering FSBO - For Sale By Owner - the knowledge necessary to do it like a pro.

What’s in it for you

  1. Overview of how selling FSBO works in Texas
  2. Reasons for and against selling a house on your own
  3. Advantages and disadvantages of selling your house by owner
  4. How to sell a home in Texas without a realtor

What is the meaning of for sale by owner (FSBO)?

Selling a house on your own in Texas by going FSBO (pronounced “fizz-bo”) means that homeowners serve as a de facto real estate agent. They list, market, and hopefully sell their home themselves, without the assistance of a licensed realtor. Common reasons that homeowners in the Lone Star State decide to sell a house FSBO include:

  • Maximize gains. By cutting out the middleman, FSBOs don’t pay realtor commissions which average 6% of a home’s sale price. 
  • Maintain control. FSBO sellers in Texas choose which offers to consider, how to market their home, and are in direct contact with the buyer and/or their agent.
  • More control. Selling a house FSBO gives you direct control over your home’s pricing strategy, showing schedule, and negotiating process.

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Reasons Texas homeowners should & should not sell a house on their own

Texas sellers who choose the house For Sale By Owner route typically fall into 1 of 2 categories:

FSBOs sell to a buyer they know. If you want to sell to a family member or friend, you might find it easier to sell a Texas house without a real estate agent. It’s assumed that many FSBO transactions fall under this scenario because, as a National Association of Realtors (NAR) survey noted, 46% of FSBO sellers did not actively market their home, which indicates that buyers and sellers knew each other.

FSBOs hate fees. In typical central Texas home selling situations, the seller alone is responsible for paying realtor commissions to both their agent and the buyer’s agent. The cost of realtor fees varies and can be negotiated down (we don’t recommend doing so) but average 6% of a home’s sale price. For example, if a home sells for $300,000, sellers must pay $18,000 in commissions which is split evenly between the buyer’s and seller’s agents.

Buyers use realtors. One notable reason people should think twice about selling their own home is the fact that most homebuyers buy properties through a realtor. As a result, FSBOs typically still end up paying the fee that they hoped to avoid – a 3% commission to the Texas buyer’s agent.

DOM vs. list price. Homeowners in Texas who consider selling their own home but ultimately do not sell FSBO understand the strong correlation between a home’s number of days on market (DOM) and its list-to-sale-price ratio (i.e., the price a home was first listed for compared to the price it finally sold for). Studies have proven that the longer a home sits on the market, the lower its final sale price. Which leads to the primary reason Texas sellers should reconsider FSBO: its astonishingly low closing rate. According to this Zillow study, only 11% of houses listed For Sale By Owner get to the closing table and another 10% of FSBOs eventually turn to a realtor. This means that people who opt to sell a house without a realtor experience long DOM and as shown below, listings which last longer than 2 weeks experience a sharp decline in final sale price.

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The pros and cons of selling your home FSBO

Before deciding to sell your house by owner in Texas, weigh all its pros and cons to make the best, most profitable choice for your home selling situation.

Benefits of selling a Texas home yourself

Reduced or no realtor fees. Not having to pay agent commissions can help sellers walk away with the most profit possible and is the primary reason homeowners try to sell a house in Texas without an agent.

Control of the FSBO process. Seller’s control asking price and description, marketing strategy, showings, negotiations, and more. Though, this benefit of selling a home FSBO could be considered a drawback depending on your availability, experience, and knowledge.

You’re the expert. Even the savviest and most experienced realtors don’t know your home as well as you. And, if you have a keen eye for home staging, this could give you an edge at showcasing the best parts of your Texas home For Sale By Owner.

Motivation and trust. You have the most to gain from selling a house FSBO and no one knows your home quite like you do, and no one will negotiate as hard on your behalf or take care of your home quite as good as you.

Fast sale potential. The National Association of Realtors reported that 77% of houses listed For Sale By Owner were sold in two weeks or less. The report also found, however, that a fast FSBO home sale was usually because the seller knew the buyer.

Cons of selling a home For Sale By Owner

Lower sale price. Homeowners who try to list a home themselves typically don't have the knowledge, experience, or resources to accurately price a home, which results in lower offers, extended days on market, or both. The 2020 median sales price of homes sold by their owners was $217,900, nearly $25,000 less than the median sales price of $242,300 for traditional home sales.

Impartiality gone. Unlike a real estate agent, a con for people who have homes For Sale By Owner are emotionally and physically tied to their house which can negatively affect their decisions on key factors like pricing and negotiating.

Less attention. Another drawback of homeowners selling FSBO is that they must rely on word-of-mouth, yard signs, and ineffective For Sale By Owner websites. Because home buyers most often buy real estate through licensed agents, listings for Texas homes sold by their owner get only a small fraction of traffic compared to properties listed on the MLS.

Labor intensive. Selling a house on your own can be a complicated, labor-intensive process. FSBO sellers in Texas often underestimate the time and energy involved, which can lead to lackluster effort and an unwanted outcome. Worse, most homebuyers “shop” at night and on the weekends so if you have a traditional schedule, expect to work nonstop until your house listed FSBO sells. 

Increased liability. Selling a house in Texas For Sale By Owner involves lots of paperwork, disclosures, and legal documentation. If you're not well-versed in contracts and tax procedures, sellers could inadvertently overlook an important detail that may lead to an audit or lawsuit after closing your FSBO home sale. 

Lackluster savings. While successful FSBOs avoid paying seller agent fees, chances are they will still have to fork over a 3% commission to the buyer's agent. Homeowners must also pay to market and advertise their central Texas For Sale By Owner listing. In other words, the 3% saved on the seller’s agent commission will likely end up being spent elsewhere.

 

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Alternatives to selling my home by owner

If saving money is the primary reason for considering selling your home by owner, there are alternatives that may be better suited for your unique situation. Each alternative to selling FSBO in Texas have their benefits and drawbacks but could result in an equal amount of savings.

Selling a house FSBO vs. with a realtor

Numerous studies exist to measure the cost benefit of selling a home through an agent compared to selling your own home for sale by owner. While many of these studies suggest that agents bring higher offers than FSBO-listed homes, most studies are inconclusive or at odds with one another. The decision for Texans to sell FSBO versus through a realtor therefore comes down to the “soft cost savings” (value that is difficult to measure but inherently exists). Does it make sense to invest your valuable time coordinating showings, marketing the property, negotiating the deal, opening and clearing title, etc.

Discount real estate listing services in Texas

Discount real estate companies can help Texas homeowners sell a house for less than selling a home through a real estate agent. The cost of these discount home listing services varies but Texans considering selling FSBO will still need to pay a reasonable commission fee to the buyer’s agent.

MLS listing for a flat fee

For a low, upfront fee, a flat fee MLS service will post your FSBO listing to a local Texas MLS market. The average fee for these flat fee listing services will cost FSBOs between $300 and $900.

Selling a home FSBO vs. to an investor

Real estate investors like Good Vibes Homebuyers will buy your home direct from you. People thinking about a For Sale By Owner home sale in central Texas will avoid agent fees, the hassle and stress of the FSBO home selling process, and don’t have to worry about bank approvals, appraisals, and surveys. Closing your FSBO sale with a Texas home investor is faster and can be done on your timeline. In many situations, Good Vibes Homebuyers can even pay more than market value. Instead of listing a house For Sale By Owner, learn how much our Texas investors can offer to pay you!

The guide for Texans on how to sell a house by owner

After looking at the benefits and drawbacks of selling your own home without the help of a realtor, should you decide selling FSBO is the right move, there are things you can do to better position yourself for success. Texans can follow these steps to increase their chances of selling a home on their own.

Things to do before listing your home for sale by owner

No matter if you sell by owner or through a realtor, first impressions often make or break a deal. Here are 3 steps to take before listing your home to help Texas FSBOs attract more and higher offers. 

Make repairs and improvements. Investing in low-cost, high-impact repairs and improvements like repainting your home's exterior and interior, replacing carpets, and installing hardwood flooring, landscaping, fixing visible damages, etc. can do wonders and pay dividends towards helping FSBOs get acceptable offers within a reasonable timeframe.

Complete disclosure forms: Texas requires that sellers disclose known material facts and the physical condition of a property to buyers. The Texas Real Estate Commission created the Seller’s Disclosure Notice, which allows sellers to report all conditions that Texas law requires to be disclosed.

The form asks for information about the condition of all physical aspects of a house, such as windows, the roof, walls, the foundation, and the electrical system. It also asks sellers to disclose environmental information about location within a groundwater conservation district, past flooding, a home’s location in a flood zone, and whether the owner presently has flood insurance.

Appliances are also covered by the form, as are questions about smoke detectors. This is a snapshot of some of the questions sellers need to answer. You may consider engaging the expertise of a real estate attorney to assist in this step in the process to reduce potential legal risk. A good time to fill out your Texas property disclosure is prior to listing your home so that you know it’s taken care of.

Clean and declutter: Texas buyers are trying to visualize themselves living in your home and that's difficult to do when it's a mess. You need to wow home buyers by showing them how much space there is for stuff – not how much stuff there is in a space.

Stage your home to sell: The average sold price of staged homes is 17% more than non-staged homes. Before Texans list their house For Sale By Owner, FSBOs should:

  • Stage the backyard with patio furniture to showcase it for outdoor entertaining
  • Stage spaces that can be used as flex areas like a home office, gym, or playroom
  • If you have a walk-in pantry, add storage bins
  • Remove and store unused items so that you can showcase how much room there is for stuff
  • Open or remove curtains to bring natural light into as many spaces as possible

Set a competitive FSBO home price

Setting the ideal FSBO listing price is key to successfully closing your deal, yet we see too many Texans get it wrong. A FSBO home priced too high will discourage offers while pricing it too low could mean homeowners are leaving money on the table.