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Buying a house for sale by owner

by | Jan 25, 2022 | Buying

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Many buyers don’t set out to purchase a home that is listed as for sale by owner. After all, only 8% of the homes sold in 2021 were listed as for sale by owner. But, it’s common to come across FSBO homes during your search. And if you choose to make an offer there are some key things to know beforehand. Let’s take a closer look at the important factors you shouldn’t overlook when buying a house for sale by owner. 

Do You Need an Agent?

One of the most common questions when it comes to buying a house for sale by owner is whether or not you need an agent. At Trelora, we strongly recommend working with a buyer’s agent for a number of reasons. Some sellers prefer to sell without any real estate agents involved, simply to save money on commission. 

Ultimately, commissions take 6% of the seller’s price. Plus, when you take the time to calculate your net proceeds, real commissions actually end up being closer to 20 to 30%. So it’s easy to see why initially, sellers think it’s a better idea to sell their home on their own. However, choosing to buy or sell a home without an agent means you must be prepared to do all the work they would otherwise be doing for you. 

In this guide let’s focus on what this means for buyers. When you make an offer on a FSBO listing, it’s essential to confirm if the seller will pay a buyer’s agent commission. With that, there are a few other things to consider if you choose not to work with a real estate professional. 

The search: Finding a home that fits your needs and budget in your desired location. Agents have access to the MLS and can show you more listings than you might find on Zillow. 

Paperwork: Often, FSBO sellers aren’t familiar with real estate paperwork and the associated contracts. Thus, it can be a risky  transaction for a buyer without a real estate agent. 

Expertise: Trelora agents close hundreds of deals each year, so needless to say they are experts in sale price negotiation. A good agent can also recommend mortgage lenders, and help you understand closing costs. 

Buying a house for sale by owner: The Process

Finding a For Sale by Owner home

For some, scrolling through Zillow is an extreme sport, with 50% of home buyers finding their home on the internet. Online listings are especially beneficial for out of town buyers. But, locals might have more luck finding FSBO listings by simply driving through their desired neighborhoods. The MLS for your area shows all homes listed for sale by real estate agents. 

Typically, when working with an agent, they list your home on the MLS and cover any fees associated with marketing the home. With a FSBO listing, the seller pays a fee to show their home on the MLS. Buyers can also find listings on sites like

Make an offer

Once you’ve found a home you love, make an offer. The offer is a contract that specifies the price you’re willing to pay for the home. It also includes earnest money and the conditions of your offer. It’s important to state in your offer that your title company or real estate broker is going to hold the earnest money deposit. If this isn’t specified, you’re choosing to trust that the FSBO seller is going to follow the law and handle your earnest money responsibly. 

Contingencies are especially important in a for sale by owner transaction as they allow the buyer to back out of the contract if they are not met. As with a traditional sale you can choose which contingencies are right for you. But ultimately we always recommend a home inspection contingency. This contingency means that the buyer can back out of the sale if the results of the inspection are unsatisfactory and the seller is not willing to make the repair or negotiate a new sales price. 


In order to negotiate in these circumstances, do your research and educate yourself on the local market. By being well informed on the neighborhood and recent sales in the area, you can better understand if the home is listed for a fair price. If you choose to work with a buyer’s agent, they can advise you on a home’s listing price, and how to respectfully negotiate. 

Writing a purchase contract 

The purchase contract is a legal document that establishes the terms and conditions of the sale between the buyer and seller whether in a traditional sale, or when buying a house for sale by owner. This contract includes the purchase price, earnest money amount, contingencies and other terms, and finally the closing date of the sale. 

It is possible to write this yourself as the buyer, or find contracts online for a fee, but we recommend working with an agent, or at the very least consulting a real estate lawyer. This way you’re aware of your rights and ensure they are protected. 

Complete the sale

After your offer is accepted and you are under contract on the sale by owner house, it’s time for your home inspection then the appraisal. If each of these steps is successful, you move on to closing. If the home inspector finds a major defect or issue in need of repair, then the buyer either renegotiates with the seller. Or with a home inspection contingency, the buyer can typically choose to back out of the contract. 

At closing, the buyer pays the down payment along with the additional agreed upon closing costs. Once closing is complete the ownership of the house transfers to you. Congratulations on successfully buying a house for sale by owner!

Key Questions When Buying A House for Sale by Owner

When buying a house for sale by owner, there are a few key questions to ask the seller. Many of these apply to a traditional real estate transaction as well. 

  • Why are you selling your home?
  • What is the neighborhood like?
  • What is included in the sale of the home?
  • Does the property have a history of issues or known past issues? 

Buying a House For Sale By Owner: The Bottom Line 

On one hand, buying a house for sale by owner can come with risk and added stress. But on the other, it occasionally offers financial savings and additional options in a tight sellers market. 

By enlisting the expertise of a real estate agent who has experience working with FSBO listings you can minimize risk and make the process more transparent overall. At Trelora, we’ve closed over 7,000 deals across the country and our agents are experts in negotiation. Speak with an agent today to learn about your options!

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The information contained in this blog is for general information purposes only, and while believed to be accurate, Trelora assumes no legal responsibility for accuracy. Information provided within should not relied upon as legal advice. Please consult with your local advisors for independent information regarding availability and applicability in your market.