Selling your home by owner in Texas can be a great way to save money if you are up to the challenge. The road to doing so isn’t going to be easy. However, there is so much information online and people to talk to, you can find yourself being an expert on the topic in no time. With that said let’s get into how to sell a house by owner in Texas.
The average price of a home in Texas is $250,000. At a 6% realtor commission, you will pay $15,000 in fees not to mention closing costs and other fees too. That’s a lot of smacks you can save by selling by owner (FSBO).
Selling your home by owner has some risks you need to be aware of. Homes tend to sit on the market longer compared to listing with an agent. And you will still have to pay the buyer’s agent’s commission which is around 3%.
Also, FSBO homes are more likely to fall out of contract as well. Many homeowners aren’t quite sure what they’re doing and buyers tend to get impatient and would rather work with a realtor.
You will tend to find that many homeowners don’t put in the time and effort needed to sell their homes properly. Leading to frustrated buyers and agents.
Realtor commission is usually the largest cost you’ll face when selling your home. So it’s a no-brainer why FSBO has increased yearly.
Pros and Cons of Selling Your own Home in Texas
A house sale by owner is easier when the market favors sellers, but it is still not simple. As a home seller, you naturally want to make as much money as possible from your home’s sale.
Pros of selling FSBO
- If you love to be in control, FSBO is right up your alley
- You don’t have to pay a 3% listing agent fee
- You can make more money from the sale
- You don’t run the risk of using a bad real estate agent
- You already have the knowledge
- You are a skilled negotiator
Cons of selling FSBO
- You run the risk of losing money on the sale. The average FSBO sells for 6% less than an agent-listed home.
- Marketing the home will take a lot of time
- Target for bargain buyers and tire kickers
- Lack of insider knowledge and know-how
- Learning about all the documents needed
- Qualifying potential buyers
- Buyers agents may discourage potential buyers
- Slower sale
Paperwork for Selling a House Without a Realtor
Listed below are the documents you will need to sell your own home in Texas. You can get all the contracts needed at TREC.com
Real estate contract: This is the purchase agreement between the buyer and seller in a real estate transaction.
Sellers disclosure: In Texas, sellers are typically required to provide buyers of residential real estate (if the purchase is not for investment) a seller’s disclosures of the condition of the home. The terms of the contract will detail when the seller’s disclosure must be provided to the buyer.
Deed: This is the document that transfers the title from the owner to the buyer on the closing date.
Deed of Trust: This is an agreement between a buyer and lender at closing. It states that the buyer will repay the loan and the lender will hold the legal title until it has been paid in full.
Addendum for HOA: The seller discloses the existence of the HOA or POA through either an addendum or within the body of the real estate contract.
Third-Party Financing Addendum: This Addendum is used when any type of financing for all or part of the purchase price will be provided by a third party (not the Seller or Buyer)
Pricing Your Home
Pricing your home is a simple process. However, if your price is too high the home can sit on the market for a long time. Alternatively, if you price it too low you can lose money on the sale.
The best thing you can do is get a pre-sale appraisal from a professional to see what the value of your home is. This will take the guessing work out of looking at comparable sales data.
You are not a professional and getting the price right will set you up for success.
How to List Your Home for Sale in Texas (FSBO)
You have many free and paid options to list your Texas home for sale by owner. You can stick a sign in the yard or list it on the Mulitple Listing Service (MLS)
- Craigslist: Sign up for free and list your home for sale. Just keep in mind that you have a high chance of attracting scammers.
- FSBO websites: There are too many to list here, but a quick Google search will get you all the information you need.
- Word of mouth: This is not a physical place to list your home. But you should let everyone know that you have a home for sale.
- MLS: Typically only real estate agents have access to the MLS. However, you can find companies that will list your property for a flat fee.
How Real Estate Agent Commissions Work in Texas
There are two types of agents used when selling your home. You have the sellers and buyers’ agents.
- The seller’s agents list the property for the owner
- The buyer’s agent represents the interested buyer
Both agents’ commissions are paid by the seller when the transaction is complete. Typically, the agents split the 6% fee.
Related Article: Estate Agent Commission, is it Too High?