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For Sale By Owner – The Master List
You've decided to sell as a For Sale By Owner (FSBO), however when it comes time to sell their homes, many people wonder what items they should repair and which ones are better left alone. This is often a question of budget, and market value but in today's real estate market where open disclosure is the norm, many savvy homeowners are pondering this question carefully.
If a home is listed with a real estate agent, the agent is compelled by law to tell purchasers all the property's dirty secrets. Many get the home owner to sign a Vendor disclosure form. As a For Sale By Owner, you're also compelled by law to distinguish those items that could pose a risk to health or safety, or that could be considered a structured defect of a major sort.
On the one hand, smart For Sale By Owners, do not want to spend needless amounts of money repairing items that are not going to bring in a return on their investment, but on the other hand, failing to repair some critical items could spell trouble during or even after the sale. For example, if the property suffers from a mold infestation then the Vendor is legally obliged to declare or repair the problem before a sale can be completed. If the Vendor fails to do so, then they are legally liable for this problem, and will likely have to pay the full price to repair it, plus accrued legal fees.
How does a smart For Sale By Owner go about intelligently deciding what to repair and what to leave undone? The answer is surprisingly simple, just make a master list then pare it down. In my previous article, entitled Doing The Walk Around, I describe a method that any FSBO Vendor can use to create a master repair list for this purpose. In this article, I will discuss taking that master repair list and paring it down to its bare essentials.
Health and Safety First
With the trusty master repair list in hand, take a moment to inspect all of the items on it and put a check mark around those items that if left undone, could pose a health or safety risk. You're on the hook for these items anyhow, so you may as well address them now. This is where the dreaded mold issue would be included. This is also the place to check off the broken stairs or loose handrails. Scuffs or holes in the walls, while still important to the sale, are not in the health and safety risk area of the list. In short, any item that could pose a health or safety risk must be included in your checked off items to repair.
Air Tight In and Out
Have a look at the condition of the roof, chimney, windows and exterior doors or entrance ways. These items should be in good form to avoid losing a sale on inspection. Nothing is more frustrating than having a sale conditionally completed and losing it on a bad inspection report from a home inspector. As a FSBO you should expect the Purchaser to insure on an inspection as a condition of the sale. By the way, do not imagine for a moment that the purchaser will forget to get an inspection. If they do not insure on it themselves, their lawyers will usually include it in the offer for them. Either way, you do not want to go there.
High Return Areas
Next, have a look at items that are in the kitchen or bathroom (s), and to a lesser extent the master bedroom. These items will likely get you a return of your investment. Now, I did not say you were going to get rich on these items, what I said is that you'll probably get the money spent on these items back in the sale price. Historically, kitchens and bathrooms have been known to return the greatest percentage of the money invested to improve them. Be very careful to avoid overspending on these items because it's easy to do. I would be remiss if I did not mention that in some cases, money spent in the kitchens and bathrooms is not fully recovered in the sale price.
Looks Nice and Easy To Do
Now comes those items that will increase the visual appeal of the property as a whole. These are things like painting the interior and exterior of the house in warming neutral tones. Replacing worn carpets, and repairing broken interior doors, walls or ceilings. This could also include landscaping and gardening.
Show Me The Money
Now that your list contains the bare essentials, it's a matter of figuring out how much the "have to do" items will cost, and then deciding if you have enough of a budget to proceed down to the next category. If you have a small budget, and you can only cover the bare essentials then do so, but remember that your end sale price will reflect this fact. If you do not have enough of a budget, and you're not forced to sell for some reason, then you might reconsider if selling is a good idea at all. I would say that if this describes your situation, then talk to your real estate lawyer to see what bare minimums you're legally responsible for doing, or at least disclosing. This is one of those time when the truth will legally set you free.
Until next time, this is George Grosso wishing you a profitable sale.
One thing that many FSBO sellers don’t realize is the importance of realtors in their sale. Statistics show that most homes, FSBO or not are sold by a realtor. This does not mean that you have to list with one, but it would be a good idea to cultivate some relationships with them to help your home sell faster. Realtors have clients and that should be reason enough to contact them. It is hard to market a FSBO home on the same level that realtors can as they typically have a huge advertising budget and established web presence. However, by contacting a realtor you are immediately letting them and by association their fellow realtors and clients that your home is available and ready to sell!
When contacting a listing agent to discuss your home sale it is likely that will ask why you are selling yourself and will offer you their services. That is to be expected, so stick to your guns and you should be alright. What they will need is as much info about your home as possible so that they can relay that to clients who are searching in your price range. If you have ever seen a home flyer from a realtor, (you can find these on most “for sale” signs) try to create the same kind of thing. This will make the process of conveying information about the home much easier.
Another things that is important is to have a home evaluation or CMA performed by the proper people. This will give you a proper price for your home that is competitive with similar homes in your area. Be careful not to price yourself out of the market right at the beginning as overpriced homes can easily acquire negative press in the real estate community. This can cause your home to be overlooked without consideration and that is definitely a big concern.
When contacting realtors try to find the most popular listing agents in your area and don’t limit yourself to just one. Making as many contacts as possible exponentially increases the access your home has to buyers. One of the most difficult aspects of FSBO sales is finding buyers so why not let a professional do it? You will still be saving a good sum of money and the chances of selling your home quickly will increase drastically.
Stock investing is a relatively recent phenomenon and the inventory of true classics is somewhat slim. When asked, people in the know will always list books by Benjamin Graham, Burton G. Malkiel’s A Random Walk Down Wall Street, and Common Stocks and Uncommon Profits and Other Writings by Philip A. Fisher. You’ll know you’re getting really good advice if they also mention Reminiscences of a Stock Operator by Edwin Lefèvre.
Reminiscences of a Stock Operator is the thinly disguised biography of Jesse Livermore, a remarkable character who first started speculating in New England bucket shops at the turn of the century. Livermore, who was banned from these shady operations because of his winning ways, soon moved to Wall Street where he made and lost his fortune several times over. What makes this book so valuable are the observations that Lefèvre records about investing, speculating, and the nature of the market itself. For example:
“It never was my thinking that made the big money for me. It always was my sitting. Got that? My sitting tight! It is no trick at all to be right on the market. You always find lots of early bulls in bull markets and early bears in bear markets. I’ve known many men who were right at exactly the right time, and began buying or selling stocks when prices were at the very level which should show the greatest profit. And their experience invariably matched mine–that is, they made no real money out of it. Men who can both be right and sit tight are uncommon.”
If you’ve ever spent weekends and nights puzzling over whether to buy, sell, or hold a position in whatever investment–be it stock, bonds, or pork bellies, you’ll be glad that you read this book. Reminiscences of a Stock Operator is full of lessons that are as relevant today as they were in 1923 when the book was first published. Highly recommended. –Harry C. Edwards
I’ve been in real estate now for over 10 years. I started with no sphere of influence and in a totally new area after moving across the country to relocate. In my first year, I was International Rookie of the Year with over $12Million in Sales. One of my main target markets was For Sale By Owners.
I learned some key pieces to actually getting these prospects to become my clients, here is the plan for conversion:
The first step is to actually have a real Action Plan for converting FSBO’s to your Listings. The Action Plan should span over 90 days for the high intensity contacts, and then convert to a lifetime of “touches” to make sure that they stay your clients and customers for life.
The initial step of the Action Plan is to find prospects: you can use a variety of sources including the newspaper (online and offline), FSBO specific sites and driving around areas. Once you’ve found them, you need to add them to your Action Plan and make that initial call.
The initial call should be something that is comfortable for you. It should not be threatening or question their intelligence. You’re probably laughing at this one, but when I started there was a colleague of mine who was also targeting FSBO’s – he would come to the office early in the morning and start making calls. You have to admire him except that he would always cut off his initial call script within 30 seconds because they hung up on him!
The reason for his massive failure was that he took a course from a highly regarded and successful real estate trainer (albeit one that had never actually sold a house!). This trainer taught him the script that I hear way too often: “Hello, this is Joe Smith – is the owner around? Great, I understand that you are trying to sell your home yourself, is this correct? Wow do you know how many people try that and then end up listing with a realtor within 30 days? Do you realize that people have actually been killed trying to sell their home by themselves?…”
The conversation was one based on fear and insulting their intelligence. What would you do if you received that call at 7:00 AM (or anytime for that matter)? You would become angry and hang up too!!!
The other mistake script is telling them that you have a buyer that you would like to bring by. The only problem with that is that you really don’t have one and then you show up to see the property and use an excuse that your buyer couldn’t make it – only to proceed to try to get them to list their home with you! Warning: they’ve heard it and been there already!
Your initial call should be one of understanding and patience – not fear and insults. Remember, the FSBO has decided to sell their home without an agents help for any number of reasons. You have no clue yet why but one of your missions later will be to find out. First, you need to get your foot in the door.
I always used an approach that allowed me to tour their property without ever mentioning the possibility of listing their home. If you approach the call as a genuinely interested person, then you will have more success.
Once you’ve met with them and toured the home. You will have substantially more knowledge on the property, the owner and the reasons for attempting to sell FSBO. You can then start to build additional trust and offer help and assistance. This is accomplished by a series of postcards, phone calls, handouts and letters.
Your postcard series should be targeted to offering various services for free or a small fee: use of your IVR system, fliers, showing and tour services, FSBO website listings and more. The more that the FSBO sees you as a friend instead of a salesperson looking to take another listing, the better off you are and will be in the future.
Your letter series should include handouts, guides and other support materials that show your professionalism without asking for a listing. Examples of your marketing materials are good but actual step by step guides (“Holding a Successful Open House”, etc.) are much better. Again, this is an opportunity to set yourself apart as the expert and the only person trying to help the For Sale By Owner succeed.
Here’s one key tip: ask to host their Open Houses. If you do this and do it correctly, you should get 1 -2 additional pieces of business from every Open House that you help that FSBO Owner with.
Here’s the bottom line – treat the FSBO as if they were already your client. Help them with their efforts… if you follow the right process, one of two outcomes will occur. Either you will be asked to list their property or it will sell and you will get referrals and additional business!
Good luck and go get them!
It's no surprise that Florida tops yet another category of the drowning real estate market among foreclosures. With sixty-seven counties in the state known for its sunshine, Florida is one of the top places for another type of real estate, FSBOs.
As Florida's market increases, homeowners are finding other ways to buy or sell real estate without spending a fortune to do so. The state currently has more than 7,601 "For sale by Owner" properties on the market, topping the rest of the nation. It looks like everywhere you look you see a home with a "for sale by owner" sign out in the front yard.
So why so many FSBO's in the Sunshine State you ask? Well, can you really blame residents of the state for not wanting to sell their homes on their own? The prices of real estate in some parts of Florida are some of the most expensive you can find, especially for median income families.
I looked up listings in Florida and noticed a 2 / 1.5 condo in one of the most dangerous looking neighborhoods in Miami I have ever seen, going for $ 270,000. Yes, I said $ 270,000 for a 2 / 1.5. Then I checked out Daytona Beach and found a 2/2 condo going for $ 340,000. This listing showed pictures of an interior that looked like the insides of a warehouse.
Whether the real estate market is tumbling or not, Floridians have had to do the-it-yourself mentality. Homeowners have lost so much money in this market that they are willing to do whatever it takes to get in or out of a home without losing money money from their investment.
Are You Thinking Of Buying and Not Using a Realtor to Buy a Home? Buying a house is one of the biggest decisions you'll ever make in your life. Now big is of course relative but we're talking of buying a house not a candy bar in your local grocery store. Moreover, homes nowdays cost anywhere from $ 100,000 or more. Certainly, that is a big amount for most people in the United States.
Can you buy a home not using a Realtor?
This is a question most people ask and the short answer is yes but do you really want to. These professionals will help you make the purchase much smoother and they will be sure to look into things and issues that you may not have thought about during the initial stage of the purchase.
It's not a good idea to shop without assistance because there's a huge market out there of potential properties. A professional will be able to assess exactly what your needs and requirements are and can already tap into a list of potential assets that fit exactly what you want. Without these people, you will be drowned with a plethora of different options and may even miss out on the best ones.
Also, you will not be able to negotiate the buying price as good as a seasoned professional. These people do this for a living and it's fair to say that they're pretty good at getting you the right price for any property. They can be aggressive on pushing down the price to a comfortable level at which the two parties can transact.
In other words, just by the amount of experience that they get, you're sure that they can give you housing at much better prices. When doing due diligence, it is very difficult to coordinate with several people in order to inspect the property. Using a Realtor can help you with inspecting for wood quality, land / terrain analysis, existence of pests, humidity, etc. They already know people who can do these tasks very well and who can write you an objective report in order to better assess the value of the property.
Nicaragua’s ethereal beauty and anarchic charms make travelling in the country an intense adventure. From the tempestuous spine of volcanoes that run down towards vast Lake Nicaragua, to the sultry rhythms of Caribbean life on the Corn Islands, Footprint’s Handbook will ensure you get the most from your trip with all the information you’ll need. – Great coverage of sights and activities, from the romantic city of Granada to the enchanting Isla Ometepe – Loaded with information and suggestions on how to get off the beaten track, from the wilderness of Bosawas Biosphere Reserve to witnessing turtle migration in the cays – Includes comprehensive information on everything from transport and practicalities to history, culture & landscape – Plus all the usual accommodation, eating and drinking listings for every budget – Full-colour planning section to inspire you and help you find the best experiences From the energy & dramatic setting of Managua to the verdant hills surrounding the coffee fincas, Footprint’s fully updated 6th edition will help you navigate this gripping, intense and poetic country.
Homeowners selling their own home usually encounter different types of people during the process of their home sale. If it's not the real potential buyer that they have to deal with, it's usually the buyer's agent. Home buyers hire an agent when they lack the time and skill to do the negotiation process and the entire transaction or if they want to make sure that they're getting the best deal.
A buyer's agent can be any licensed real estate agent or broker who represents the buyer. He or she may either be a member of the National Association of Exclusive (NAE) Buyer Agents who represent only the buyers and do not handle listings or a member of the Real Estate Buyers Agent Council (REBAC) which is associated with the National Association of Realtors (NAR). Agents from REBAC have the option to choose to become exclusive buyer agents or an agent of both buyers and sellers.
In selling your home yourself, do learn about the functions of a buyer's agent too. Real estate buyer agents work on commission and are paid by the seller after the transaction has been completed. Home sellers typically pay between five and eight percent of the sales price. However, when more expensive homes are involved, sellers can negotiate for a lower commission rate. In addition, the buyer in his purchase offer can ask the seller to pay all or part of the agent's commission or fee although the seller is not obliged to do so. Proper negotiation, therefore, is of utmost importance when working with a buyer's agent.
Home sellers should also know that an agent who represents exclusively the buyer works for the best interest of his client and is more motivated. Agents should also be good listeners and must be able to resolve conflicts that may arise during the transaction.
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