When thinking about putting your home on the market, selling it as a “For Sale by Owner” or FSBO, one of the first things you need to do is determine the value of your home so you can price it accordingly. Typically, when you hire a real estate agent, he or she would conduct a market assessment for this reason but with a FSBO, you would do it yourself.
Keep in mind that conducting a market assessment does not have to be a long, difficult process. The goal is to determine the value of similar homes in your vicinity. For instance, let us say you have a three bedroom, two-bath home with a two car attached garage. You purchase the home five years ago for $125,000 but now, you need a larger home so you have decided to sell.
The question however is, what price should be placed on the home. For starters, you want to make sure the home is in the best possible condition. Replace any leaky faucets, any torn screen doors, or windows, any damaged carpeting, and so on. Then, after the home is in ready condition to sell, you would need to hire an appraiser. This person is a professional who will walk through your home, measuring the size of rooms, looking at the condition in the attic, basement, on the roof, etc.
When finished, the appraiser would be able to tell you not just the condition of the home but he or she would also be able to give you a good idea of the current value. The benefit of hiring a professional appraiser is to know what things, if any, you need to fix. Sometimes, the appraiser may point out a few small things that would have little impact on the selling price but then again, a few items might need immediate attention, items that could reduce the selling price by hundreds or thousands of dollars.
In addition to hiring the appraiser, you can do a little bit of investigative work on your own. For this, you could drive around or start checking the internet for homes on the market that are located within a five-mile radius from where you live. Then, check for homes that also have three bedrooms, two bathrooms, and a two-car garage. In addition, look for other similarities to include swimming pool, finished basement, new roof, siding, etc. With this list, you can look at the prices and come up with an average of where your home should fall.
Most importantly, never price your home at the top of the price range. Typically, this could cause your home to sit, which then makes it look like something is wrong when it does not sell. Instead, price your home a little bit under the top two priced homes. This puts you in a much more appealing position for potential buyers, which means a quicker sale but also at a fair market value.