Occurs: Whole Day, Every 1st Saturday of all the months except for January and August
Visit your villagers on this day and they will be selling their furniture to you "Garage Sale" style. Just choose any particular piece of furniture and your neighbor will either sell it to you or you can haggle first to lower the price. Take note that not all furniture can be sold. Also, the better camaraderie you have with that villager, the better the offer. On the other hand, enter your house and your villagers will try to buy your items as well. Likewise, they will have the option to haggle your selling price first. Better relationship with that villager means they could purchase your item at a very high selling price.
Simply pull out any valuable selling items that you have and display them on your house and you will be good to go. If you would like to display some more items, just open up your town gates.