Several Misconceptions Exposed About For Sale By Owner Transactions

There are several misconceptions about a For Sale by Owner type of transaction in the real estate world. If you are attempting a FSBO, you’ve come to the right place. Let’s discuss some of the myths and facts about this popular method of selling your house. Hopefully, this will address some of the misconceptions and misinformation you have about the process. It can be a positive transaction for all the parties involved, when done correctly.

Myth #1: I have to know a lot about real estate in order to sell my house on my own. I should be licensed as a real estate agent or at least take some classes.

Truth: While it can be extremely helpful to know the laws about real estate in your area, you do not have to know it all. Many times you can hire an experience real estate lawyer for much less than the agent’s commission and you are legally covered. These lawyers can provide you with the necessary contracts so that the sale is legal and binding. You may benefit from real estate classes or some simple online training but you don’t have to be licensed to sell your own property. Legally, any owner can sell their property without having a real estate license.

Myth #2: I need to be great with people to sell my house.

Truth: You shouldn’t be scared of people. There are some people who have a natural aversion to people and would consider themselves a hermit. Most people, however, can talk to other human beings on a one-on-one basis. If you are nervous in crowds, you have the ability to limit showings to one person at a time. You never have to host an open house and you can ask to only speak with the actual buyer, not their entire family. If you work and interact with people on a daily basis, limited or not, you can perform the necessary talking that will sell your house.

Myth #3: I’ll make a larger profit when I do a FSBO.

Truth: While many sellers do report making a larger profit, many experience the benefit of simply not paying money out of their own pocket. In this current housing market, the competition is plentiful and you may need to lower the asking price to compete in the market. You have to be willing to compromise to have a successful sale. When you lower the price, you may not have the leftover money from the sale to pay an agent and concessions. A FSBO will let you skip that part and lower the price enough to sell but you may not make a substantial gain on the house.

Myth #4: People will call and stop by at all hours of the day and night.

Truth: You will get phone calls, emails, and even drive-bys. Don’t think of them as a nuisance, but rather as money in your pocket. These are potential buyers and the faster you can get them to buy, the sooner you can be done with the hassles. It may be a pain to have the showings and distribute the info, but in reality when you use an agent, they don’t clean for you, make the decisions for you, or even create a budget for you. Those are all items you will do on your own so why pay an agent to do that.

Myth #5: It will hurt my neighbors and area to have a FSBO instead of a "real" sale.

Fact: When a house sells, the price is recorded. Depending on where you live it can be public information. Regardless of how it sells, the information is recorded. Even if you sell your own house, your area will not be hurt by it. Would your neighborhood benefit from a new person moving in and buying the house or from the house sitting vacant with the ability for squatters and vandalism? You need to sell your house so why not do it while you are in control?

Taking control of your real estate situation means doing what is best for you and your situation. Don’t allow others to determine or intimidate you into a decision. Real estate gives you the ability to control the future and you can be in complete control of the transaction.

Immobilienmakler Heidelberg

Makler Heidelberg

Rich Dad’s CASHFLOW Quadrant: Rich Dad’s Guide to Financial Freedom

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Immobilienmakler Heidelberg

Makler Heidelberg

Northville Michigan FSBO: Whether You Need to Sell or Want to Buy

With prices on Northville Michigan FSBO condos starting around $170K and Novi, Michigan FSBO single family homes closing at a half million, first time buyers, with not so perfect credit or little money to put down, may think that home ownership is out of their reach.

Likewise, investors looking at properties listed as „For Sale by Owner“ in Northville, Michigan might think there is no money to be made here. But, with a little help, buyers, sellers and investors alike can find the right opportunities for their specific situation to create win/win/wins for all parties concerned.

Novi has grown fairly constantly since the 1950s and is currently considered one of the fastest growing cities in Michigan. Home of the recently renovated multi-million dollar Twelve Oaks Mall and less than thirty miles from Detroit, property values are good. Some of the Novi Michigan FSBO properties are waterfront, which is highly desirable for many people.

Northville is right next door. The people who live in these suburbs, according to the most recent census, are mostly married couples with children and the median family income is between $90 and $100K per year. With nice neighborhoods and good schools, it is not unusual to see a newer Northville Michigan FSBO home in good condition priced in the upper $400s.

On the other hand, it is not unusual to see ads like this, „For sale by owner in Northville, Michigan, price recently reduced, owner must sell quickly.“ In January 2007 alone, more than 20 homes in the area came up for auction and even more are in pre-foreclosure status. What’s the problem? For the most part, auto industry layoffs. According to Governor Granholm whether you like her or not, the state has 635% more automotive jobs than any other state in the country.

Experienced investors like us here help facilitate transactions because for every „motivated“ seller, there is an equally motivated buyer. Currently state and local governments are working to attract more „economic diversity“ to the state, in other words, jobs that do not rely on the automobile industry. The people who get those jobs will be looking for a place to live.

The trick for us as investors is to use our knowledge and experience and bring the buyers and sellers together…helping them „find each other“, so to speak, without a real estate agent. Cutting out the real estate agent means more money in everyone’s pocket, although we can even work with Realtors as well if one happens to be representing you.

Homeowners in trouble should know that there are ways to avoid foreclosures. Buyers, even those with problem credit, should know that they can own their own home, usually on a rent to own basis, thereby creating equity for themselves rather than throwing away money to a landlord.

And sellers should know that if they are having problems selling their homes, and are motivated to work on terms, investors like us can employ various strategies in helping them achieve their goals, such as land contracts, finding a buyer for a lease option, and helping get that buyer financed.

The real tragedy in reading the Northville Michigan FSBO ads as they linger for months on end, is that there are creative yet simple solutions.

Buy-Sell-Michigan-Real-Estate.com can help by bringing buyers, sellers and other investors together.

Immobilienmakler Heidelberg

Makler Heidelberg

How to Sell A House Without a Realtor: FSBO

Not everybody has the luxury of placing their residence on the open market and patiently waiting months to execute the deal. The common process when posting your property on the open market will be:

  • Question/Interview many real estate professionals
  • Authorize a listing contract with a person to list your home for an exact time frame (usually a 6 month listing)
  • Handle a variety of open houses
  • Hold out for offers and then bargain with prospective buyers
  • Set up home inspections, reports and also other disclosures to be filled out
  • Sign contracts for close of escrow.

For anyone who is lucky, the process can take about six to eight weeks. If an offer falls through or maybe your home is just not getting many offers, you could end up waiting six months or even more. Alternatively, instead of all that inconvenience, having to pay five percent or more on commission fees and settlement costs, let us take a review of how to sell a house without a realtor.

For Sale by Owner (FSBO)

A basic strategy to market your property without a real estate professional is „For Sale by Owner“ or FSBO for short. The common way individuals attempt to market their property in this manner is to set up a few signs in the lawn or perhaps your neighborhood newspapers and then wait around for individuals to trickle in. Instead of this unaggressive, and frequently unsuccessful strategy, let’s take a quick look at various other methods to market your house to have it sold quickly. Everything starts off with better promoting. Instead of doing the minimum amount, you should do a great deal to get the house to stand apart within a crowded real estate market. A few things we’d recommend are:

  • Tell all your nearby neighbors that you are selling your home and inquire if they know of anybody looking. (Extra: You can easily offer referral fees to compel your neighbors)
  • 1st opinion can be everything, so fix up the front side of your property. It is commonly referred to as „curb appeal“. If it doesn’t look good when prospective buyers are driving around it, it’s likely they probably will not want to enter into the home.
  • Getting premium quality photos obtained can make a whole world of difference; hire or simply just take them by yourself, but be sure your property is staged beautifully. Meaning absolutely no wide open toilet seats, no trash, beds made, chairs pushed-in, etc.
  • Get out sandwich board signs along with balloons or some other eye-catchers advertising your property on active intersections in your community.

After a little bit of preparation, a few dollars plus some advertising your FSBO house has a significantly better chance of selling.

Craigslist

Craigslist happens to be a completely crucial resource for everyone who is going to be selling their house not using a realtor. Ensure that you use descriptions of your residence which makes it sound as nice as possible. Discuss the area – are there any parks, local community facilities, schools, places of worship or other facilities close by? What about your specific community/subdivision – are the roads tree-lined, are there any hills, any kind of views? Additionally, make use of those high-quality photos as a way to bring in buyers. A determination to see your residence or not will be made completely on your descriptions coupled with photographs of your residence.

Open Houses

Open houses are a good way to attract prospective buyers (just check with any real estate professional). You should help make potential buyers feel as at home as they possibly can. You should definitely clear any clutter, garbage or toys and games. A few other ideas could be to have the fireplace running when it is cold outside, making a lot of cookies to give the home a pleasurable aroma, setting the dinner table and possibly flip on the game should the local sports team be on. The secret is having people picture themselves living there therefore give consideration to getting rid of any sort of personal knick knacks and family photos. Be sure to promote your open house early and frequently with the use of signs near your neighborhood, Craigslist, sharing with your neighbors and whatever else that will get people in your home. One last suggestion: acquire booties that can go over people’s boots and shoes so they don’t track dirt and grime all the way through your immaculately cleaned property!

Investors

The final, but most certainly not last, spot to look is at investors. If you have to sell your house rapidly, have some problem areas which need to be remedied or maybe you don’t want to take care of any of the above issues give a nearby investor a phone call. These folks are dedicated to acquiring buildings without making use of a realtor.

Immobilienmakler Heidelberg

Makler Heidelberg

The 5 Steps to Selling Your Home on Your Own

While it’s not always advisable, it’s definitely possible to sell your home on your own – in other words, without a Realtor. If you’re organized and follow the steps below, you can potentially save 2-3% in Realtor commissions. On an average home price, this means savings anywhere from $3000 – $4500!

Now please keep in mind: this will mean spending around $1,000 up front to really do everything correctly. You can simply look at this as an investment in saving money, however, once you actually sell the home.

Step 1 – Get your home professionally inspected.

Depending on the size of your home, this will cost anywhere from $200 to $400. Almost all buyers will get a home inspected, but I recommend you – the seller – do it yourself before putting the home on the market.

The reason for this is simple: you need to know more about the home than your buyer does when it comes time to negotiate price.

Normally the home goes under contract at a specific price, then the potential buyer gets the home inspected. This puts you, the seller, at a disadvantage. The reason being, it’s better for you to know any potential problems when you are pricing the home, rather then finding them out once you have a buyer.

Let me put it this way: do you know if your home is wired up to code? Unless you’re an electrician, you probably don’t. Now think about this: which would be better, for you to know that your home isn’t wired up to code and price it accordingly, or for you to find this out after a buyer has your home under contract?

In a home negotiation, knowledge is power! It’s worth $300 to get the edge in this department.

Also make sure you get a termite inspection if termites are an issue where you live. Termites can destroy your home quickly, and many times you won’t know this until it’s too late. The good news is most termite companies will inspect your home for free as a way to earn your business. You can even have more than one company do this inspection.

I recommend you do these inspections before you do anything else. The home inspection usually takes about 3 hours, and the termite inspection takes about 1 hour. Other than letting the inspectors inside, you don’t even have to be present in the home! Most inspectors can schedule their work to be completed within a week’s time.

Step 2 – Get three contractors‘ bids on each major item that needs repair.

After the inspections, you will know what’s what. You then should consider repairing major items. These include: foundation, electric, plumbing, HVAC, framing, and roof work. If any of those things show up on the inspection report, get three different contractors to look at the issue and give you a bid. Make sure you get these bids in writing

Additionally, you’ll want to bring in contractors on any big cosmetic issues. If you have old carpets, holes in the wall, broken windows, etc, you will want to know what is costs to fix or redo them.

Now, none of this means that you need to actually fix anything. This depends on how the housing market is doing in your area. If homes are selling quickly, I recommend not making any repairs and just selling the home „As-Is,“ with the cost of these repairs subtracted from the price.

If it’s a tougher market for sellers – or what’s often known as a „buyer’s market“ – then you may need to look at getting the major items fixed or allowing for an additional „repair allowance.“

This will be a big help in your price negotiation. If your buyer brings up an issue, you will already have contractor bids in hand. You can simply adjust the price in a way that works better for you both. Plus, when you show that you’ve done your homework, a buyer is usually less likely to resist in whatever price adjustment you offer.

Step 3 – Find out what homes are selling for in your neighborhood.

I emphasize the word selling as it doesn’t matter 1) what a home is listing for or 2) what you think it’s worth. A home’s value is what a buyer is able and willing to pay for it.

You may need to consult with a Realtor to find out what other homes have sold for. Many will be happy to do a market analysis and let you know a good selling price for your home. This does NOT lock you into working with that Realtor, but make sure you let them know in advance that you are going to sell the home on your own. That same Realtor can always find you a buyer, so doing this number analysis can benefit both parties.

Pricing the home correctly is critical, so you need to also factor in the price of any repairs needed. My suggestion is to simply subtract their cost from your asking price and sell the home „As-is.“

Having the bids from contractors about the repair costs will help show your potential buyer (and the buyer Realtor involved) that you are serious and organized. It can speed up the selling process as sometimes the buyer won’t even require a new inspection, and this open transparency on your part is the key to getting a deal done fast.

Step 4 – Clean, de-junk, and stage your home

You want your home to be as clean and clutter free as possible. If this is easy for you, then by all means do it yourself. If not, I’d recommend „Got Junk“ to get rid of any clutter and then a cleaning service.

You want as few of your own personal items in your home as possible. You might even consider renting out a storage place for a few months as well.

You want to stage your home which basically means removing personal items and arranging your furniture in a simple way.

The basic idea behind staging is that your potential buyer will start to „see“ their own furniture in your house. Once this happens, they’ve started to buy your home already. It might sound strange, but homes that are staged sell 79 percent faster!

The other benefit of doing all of this is that it will make your move much easier. Let’s face it, you need to get rid of that junk sooner or later anyway. So why not do it before you move out and make a faster, more profitable home sale along the way!

Step 5 – List your home on MLS fee sites and all the other important online places

One of the best things that a Realtor can do for you is list your home on the MLS (Multiple Listing Service). There are Realtors out there that will do this for a small fee (usually around $200). They take no commission, just the upfront fee. This will expose your home to all the Realtors who have buyers.

The second thing I recommend is to put your home on Postlets. It’s a free site that will put your home on Zillow, Yahoo, and Craigslist. These sites have a huge number of potential buyers for your home.

The last thing you may want to do is put up a „For Sale By Owner“ sign. Some people prefer not to do this for various reasons related to privacy and safety. I personally don’t think it’s too important to use a „For Sale By Owner“ sign unless there are a lot of car and/or pedestrian traffic near your home.

The most important thing once you’ve done the previous 4 steps is to make sure as many qualified buyers as possible know about your home. By putting your home on the MLS and Zillow you are making serious homebuyers aware of it.

If you want to minimize tire kickers even further, you can opt to only show the home to buyers who can prove they are pre-approved by a lender or have enough cash to buy your home outright. Serious buyers will have no problem doing this, especially if it’s a competitive market.

Conclusion

Those are the five crucial steps I’ve used on every site built and mobile home that I’ve sold. The vast majority of the homes have gone under contract in less that 28 days, so it’s worked well for me – it should work for you as well!

Immobilienmakler Heidelberg

Makler Heidelberg

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