How to Sell a House by Owner in Arizona

Quick FSBO overview

FSBO is a method of selling your home without the involvement of a listing agent. In a FSBO scenario, the seller assumes the responsibilities that would normally fall to their agent, such as pricing the home, arranging showings, and negotiating the deal. This primarily enables sellers to save on commission fees.

Agent commissions

For decades, the seller has been responsible for paying agent commissions, which typically range from 5% to 6% of the home’s sale price in a traditional agent-assisted sale. This fee was split between the listing agent and the buyer’s agent. Recently, however, agent commission rules have changed following the historic National Association of Realtors® lawsuit settlement.

Under the new commission structure, sellers are no longer required to pay their buyer’s agent’s fee, as buyers are expected to negotiate directly with their agents. Thus, sellers working with an agent only have to cover their listing agent’s fee, which is about 2.5% to 3% of the home’s sale price, depending on negotiations.

But while these new rules aim to reduce fees, some sellers still feel the need to cover the buyer’s agent’s fees to entice more buyers or expedite a sale. Thus, if you partner with a realtor, you may be looking at paying a commission of 3% (your listing agent’s fee) to 6% (your listing agent’s fee and your buyer’s agent’s fee) of the home’s sale price.

Commission savings

By selling FSBO, you can eliminate the cost of the agent commissions since you won’t have a listing agent. If you decide to cover the buyer’s agent’s fee, you’ll only pay around 2.5% to 3% of the home’s sale price, still saving you a good chunk of money.

Even with new commission rules in place and in a FSBO transaction, buyer’s agents expect compensation for the work they do to bring a buyer to a sale, such as arranging showings and helping to tee up and qualify the buyer. Plus, when a seller isn’t working with an agent, the buyer’s agent may end up carrying more of the weight to get the deal to the finish line.

Next: Consult our guide on who pays closing costs when selling a house by owner for more details.

Finally, an FSBO sale does not mean that a seller won’t need professional assistance. Most people who sell by owner will need to hire an attorney to review and prepare key documents and ensure that paperwork, such as the seller’s disclosures and purchase contract, is filled out properly.

How to sell a house by owner in Arizona

Disclaimer: This blog post is intended for educational purposes only. HomeLight recommends that you look into the real estate regulations for your area and consult a trusted advisor.

By opting for a FSBO sale, you’re competing with homes that have the advantage of a real estate agent’s extensive marketing resources. These steps aim to give your home a better chance of resembling a professional listing and attracting the attention of potential buyers.

As reported in HomeLight’s Top Agent Insights Report for End of Year 2023, pricing and preparation are still key to maximizing a client’s home sale, even in a challenging market. Here’s what top agents recommend to their clients.

Step 1: Address needed repairs and maintenance

FSBO sellers in Arizona may consider getting a home inspection before listing their home for sale. Addressing any issues upfront helps buyers have peace of mind when making an offer. However, be aware that if you get a pre-listing inspection, you will be required to share relevant findings with buyers and how you did or did not address them.

Step 2: Fill out your disclosure form(s)

Sellers in Arizona are required to complete the Seller’s Property Disclosure Statement (SPDS) as thoroughly as possible and attach relevant documents for the buyer. This may include warranties, invoices, and leases.

A good time to fill out your Arizona property disclosure is prior to listing your home so that you know it’s taken care of. If you use the Residential Resale Real Estate Purchase Contract provided by the Arizona Association of Realtors®, disclosures are due to the buyer no later than three days after contract acceptance.

Arizona’s form will walk the seller through disclosing any known association fees, anticipated disputes, tax liens, or assessments affecting the property. The form also covers details about the property’s condition, such as whether there have been any roof repairs, foundation cracks or settling, chimney or fireplace problems, or termite issues, among other items.

Depending on the age of your home, you may also need to complete a Lead-Based Paint Hazards disclosure for residential sales.

It’s almost always advisable to engage the expertise of a real estate attorney to assist in this step in the process to minimize potential legal risk. According to Arizona’s disclosure form, “if you do not make the legally required disclosures, you may be subject to civil liability.”

Step 3: Declutter, clean, stage, and add curb appeal

Research shows that thoroughly cleaning and decluttering your home before putting it on the market can lead to significant benefits. HomeLight’s Top Agent Insights report reveals that decluttering a home can increase its resale value by an average of $8,000.

Another HomeLight survey found that deep cleaning can add $3,700 to a home’s sticker price. That’s well worth a weekend’s work (or $118 to $236 when you bring in a professional cleaning service).

You may also want to consider strategically staging your home so that buyers can envision how each space could be used. According to HomeLight’s survey, 67% of agents say staging helps to sell homes, while another 31% consider staging to be “essential for a sale.”

Without the independent advice of a real estate agent, FSBO sellers can invite over friends and family for an honest opinion of how the house looks: Will it pass muster with buyers, or do some spaces in the house need a bit more attention?

Finally, don’t forget about the outdoors. Great curb appeal will help get buyers in the door. Consider sprucing up the landscaping with fresh mulch and plants, painting the front door an eye-catching color, or having your home’s windows professionally cleaned.

Step 4: Price your home competitively

When selling a house by owner, you need to take care to set the right asking price. Price too high and your property is likely to be on the market longer than necessary; price too low and you could significantly undersell your home.

Follow these steps to price your Arizona house for the market:

Start with a free online home value estimate

As a starting point, look at several online estimators for your home’s value. HomeLight’s Home Value Estimator aggregates publicly available data such as tax records and assessments, your home’s last sale price, and recent sales records for other properties in the same neighborhood of your Arizona home.

Gather your comps

Comps are recently sold homes comparable to yours in characteristics such as size, age, condition, and major features. The most reliable comps are going to be those within as close of a radius as possible to the location where you’re selling a property.

Since you won’t be able to access data from the multiple listing service (MLS) without a real estate license, you’ll need to look at major home search sites to collect your data.

Conduct your own comps analysis

Compare your home’s features against the nearby comps you collected. Hopefully, the houses you studied give an indication of an appropriate price range for your home. From there, make dollar adjustments based on characteristics that add value (pools, new floors, an extra bedroom) versus detract from it (a busy street, deferred maintenance, less square footage).

Get a pre-listing appraisal

A DIY comps analysis is risky if you don’t have a ton of experience making sense of property data. Alternatively, you could pay for a pre-listing appraisal. An appraiser will combine desk research with an onsite visit to your home to provide a professional and independent opinion of value.

Appraisals usually cost $357 on average, and getting one doesn’t mean that a buyer’s lender won’t require a separate and independent appraisal before closing. However, it can reduce some of the stress of pricing your home for sale since appraisers are licensed and trained for this work.

Step 5: Arrange for professional photography

A professional shoot that includes 25 to 50 photos can cost between $150 and $300, while a shoot that includes both photos and video can run you $300-$900.

FSBO sellers should consider the copious benefits of getting professional photos to include in their listings. A professional photographer will take steps to shoot each room from the best angle, ensure optimal interior and natural lighting, and edit for the ideal brightness and exposure.

A high-quality camera with a wide-angle lens is also essential to showcasing entire rooms rather than half or three-quarters of what’s there. For these reasons and more, professionally photographed homes can sell up to 50% faster than houses marketed without high-quality photos.

In addition to professional photography, consider these add-ons to enhance your FSBO listing:

• Drone photography: Getting an aerial view of the property can help buyers see the location and layout. Homes with drone or aerial photographs tend to sell 68% faster, which can help your FSBO listing compete.

• Video walk-through: A professionally edited video walk-through will help attract out-of-town buyers who might not be able to come for an in-person showing.

• Floor plan imaging: Having a 2D or 3D floor plan image allows buyers to see spatial relationships regarding how the home is connected.

Research from the NAR shows that 100% of home buyers used the Internet to search for a home in 2024. Additionally, 41%of found photos on websites to be very useful. That means your home’s visual online presence is more important than ever. Even the best cell phone pictures can’t compete with professional images.

Note: When selling a house by owner in Arizona, the seller will need to arrange for these marketing services on their own and budget for them as part of their listing expenses. When working with a full-service real estate agent, professional listing photography is almost always going to be included — and many agents offer aerial photography and 3D tours as part of their listing package.

Step 6: Market your home to buyers

Unless you have a buyer lined up, you must boost your property’s online presence. Listing on the MLS will give your property more visibility. As a FSBO seller, you can opt to have your property listed on the MLS for a flat fee, or you can employ a listing service that will charge a percentage of the sales price for services that include MLS access.

Step 7: Field and negotiate offers

Hopefully, your marketing efforts lead to one or more offers on your Arizona property. But not every offer is a good offer. As a FSBO seller, you’ll be responsible for negotiating a contract you’re satisfied with. Price is a major factor, as are other details of the agreement, such as whether you’ll cover any of the buyer’s closing costs and the buyer’s agent fee, when you’ll agree to move out, and which contingencies will be included in the contract.

Let’s review some of the top points of negotiation you may encounter:

Contingencies

Buyers may ask for the offer to be contingent on other factors, such as the sale of their existing home or their ability to obtain financing. They are also likely to include a home inspection contingency, which is a stipulation in the purchase agreement that says the buyer can inspect the home, top to bottom, and then decide whether to move forward with the purchase.

Finally, FSBO sellers should be aware of the home appraisal contingency, which buyers often add as protection if the appraised value comes in lower than the purchase price. A contingency-free contract is rare, but in a seller’s market, buyers are more likely to waive one or more to strengthen their offer.

Closing costs

Both buyer and seller will have costs to cover at settlement. However, some of these costs — such as title fees, escrow fees, and transfer taxes — can be negotiated in many instances.

A buyer may request that you pay a portion of their closing costs. These seller credits or concessions can be used to offset the cost of repairs flagged by the home inspection or as a way to sweeten the deal and secure the sale.

Repairs

Following the inspection, a buyer may ask you to make necessary repairs or for monetary compensation based on an estimation of what the repair is likely to cost. You can either accommodate the request or do nothing, but the buyer can choose not to continue with the purchase if the results of the inspection aren’t satisfactory (unless they opted to waive the home inspection contingency).

Closing date

Closing dates can be subject to negotiation as well. Buyers may need longer to secure financing, or sellers may ask for additional time to move out after closing. On the flip side, one party may ask for a quicker closing date to enable them to move faster if needed.

Earnest money

The earnest money deposit is typically a small amount of money that goes into an escrow account to show that the buyer is serious. It’s negotiable, and it always goes toward the purchase price.

When buyers add contingencies to the contract, they can back out of the deal and get their earnest money back in certain circumstances, such as if anything unsatisfactory turns up on the inspection report. You’ll need to have a third-party account set aside to hold this earnest money until closing (such as a title company).

Remember that even if you come to terms with your buyer verbally at first, you’ll want to put the offer in writing using a residential real estate purchase contract. A purchase contract is a legally binding document that protects the interests of both the seller and the buyer by specifically outlining expectations prior to closing.

To reduce the risk of errors for your sale, hire a real estate attorney to review the contract for you. The attorney can also advise you on the necessary steps in preparation for closing. A real estate attorney usually charges $150 to $350 per hour.

Step 8: Complete steps to closing

After you go under contract with the buyer and finalize the details of the purchase agreement, escrow opens. Real estate transactions in Arizona are typically closed by escrow agents and title companies.

In Arizona, either buyer or seller can propose their choice of escrow, but they must eventually decide on a company to go with. Before the deal is final, you can expect the following next steps to occur:

• Complete the home inspection, usually within five days to a week of signing the purchase agreement.
• Negotiate inspection items (if applicable).
• Complete home appraisal by a third-party independent appraiser (necessary if your buyer is using a mortgage).
• Negotiate appraisal results (if applicable).
• Let the buyer complete the final walkthrough. They’ll check if the home is in “broom clean” condition, if it’s swept, vacuumed, and free of debris and excess stuff. The buyer will also ensure that no damage has been done to the property since their last visit.

Step 9: Close the sale

Arizona is a “dry funding” state, meaning that all parties sign the necessary mortgage and title documents to close on the home, but the purchase isn’t funded at that time.

Dry refers to waiting for the ink to proverbially dry before a deal is closed. The extra padding of the clock provides an additional layer of protection to ensure there aren’t any issues with the transaction.

Be aware that closing as a FSBO seller does not mean that you avoid all closing fees. Common seller closing fees include prorated property taxes and settlement fees. One nice thing about selling real estate in Arizona is that the state doesn’t charge any transfer taxes — only a tiny $2 flat fee for the contract or deed.

If a buyer uses an agent, you have the option to pay their agent’s commission to expedite the sale. Consult our guide on who pays for closing costs when selling a house by owner for more details.

The next steps are likely to include:

• Attorneys review documents for errors.
• Clear title. Resolve any title issues necessary to close.
• Transfer ownership of your home to the buyer at settlement.
• Funds are disbursed to the seller and other parties involved.
• Review your settlement statement for a complete list of fees and credits of the sale.

Challenges Arizona FSBO sellers face

Some Arizona sellers may not bat an eyelash at the steps outlined above, but many FSBO sellers find the actual execution a lot more challenging.

One major concern is the possibility of underselling the home. According to the latest data from NAR, FSBO homes sold for $380,000 in 2023, compared to $435,000 for agent-assisted sales.

Alternatives to selling a house by owner

There’s more than one way to sell a house. In addition to FSBO, below are a few of the methods available to Arizona sellers.

Option 1: Request a cash offer for your home

Another option for selling a house without a real estate agent is to work with an investor or house-buying company purchasing homes for cash in your area.

Saving on commissions is often top of mind for FSBO sellers, and selling your house for cash is another option where you can do that. A cash transaction can usually be turned over in as little as a week to two weeks, as it allows you to skip the mortgage process and the appraisal, which are typically the two most time-consuming steps.

If this option interests you, consider requesting a cash offer through HomeLight’s Simple Sale platform. Sellers using Simple Sale receive an all-cash offer in 24 hours and can close in as few as 10 days, with the flexibility of selecting a move-out date.

That said, it’s important to know that investors typically pay under market value for the homes they purchase, and sometimes significantly so. Simple Sale shows you a side-by-side comparison of your cash offer amount against an estimation of what you could list for on the open market to help you make an informed decision.

Option 2: Hire a top Arizona real estate agent

Research shows that agents statistically sell homes for more money, helping to offset or even exceed the amount paid in commission fees. And they do it while wrapping your entire listing and selling process in absolute professionalism.

Work with a top-rated agent, and the results are likely to be even better. Internal transaction data at HomeLight finds that the top 5% of real estate agents sell homes for 10% more on average.

A real estate agent helps you fetch the highest sale price by putting together a beautiful listing, advising you on targeted upgrades, and negotiating the best price — and that’s just scratching the surface of their expertise.

If you’d like to explore the option of working with a top agent further, HomeLight would be happy to connect you with a top performer. The service is 100% free and takes less than two minutes to match you with top agents in your area. Agents don’t pay to be featured, and our recommendations are based on location, performance, and specializations.

Whatever direction you choose, we hope that selling your Arizona home goes smoothly.

Ready to sell your Arizona home?

Selling a house by owner can be a highly rewarding experience, offering you greater control over the process and the potential to save on agent commissions. But it does take a lot of time, effort, and some know-how about pricing, marketing, and real estate rules. If you’re not fully prepared, it can get pretty overwhelming.

If you prefer a less stressful transaction, hiring a real estate agent is a great alternative. Agents bring expertise, marketing strategies, and negotiation skills that can simplify the sale and help you achieve the best price with less stress. Weighing both options will ensure you choose the best path for your home sale.

If you choose to go FSBO, you should have a good idea of what to expect from the process now. But if you need assistance, partner with a top-performing professional. Connect with some of the best agents in your Arizona market.

Header Image Source: (Ярослав Алексеенко / Unsplash)