The Ultimate For Sale By Owner Guide
As a result of changes in the real estate industry, for sale by owner or FSBO has become an extremely popular way to sell a house. The Internet has made the for sale by owner process much easier because it provides access to real estate related information and a low cost solution for marketing a property. It has also become very simple for individuals to order professional for sale by owner signs to advertise their homes. The main advantages of FSBO are saving money on real estate commissions and having control over the selling process. Selling a home is often a confusing and complicated series of events; this guide will give you the tools you need to succeed.
Prepare your home for sale. The first step in any real estate sales process is cleaning up the property to make it as attractive to potential buyers as possible.
Clean and organize the interior of your home to remove any clutter from counters, tables, and rooms. Paint faded walls and make obvious repairs. Use scented candles and other mild fragrances to enhance the atmosphere. It is also a good idea to reduce any signs or smells of your pets by having them stay with family or friends while your house is for sale. If you are going to keep
your pets around you will need to pick up toys, keep litter boxes clean, vacuum frequently, and move
food dishes to an out of the way area. Never let your pets wander around the home while it is being
shown to a buyer, it could make them feel uncomfortable and lead to a lost sale.
Power wash the exterior of your house to remove any unsightly mold or mildew. This will also prepare your home for any painting that it may need. Review the entire exterior for minor maintenance issues and make necessary repairs. Maintain a well manicured yard while your home is for sale. Keep your grass cut, bushes well trimmed, and remove dead plants and weeds. If your yard is very sparse, it may be a good idea to plant a few trees and flowers. Do not spend too much on new plants, because many buyers are not willing to pay the costs of expensive landscaping.
Final walk through
Once you think that you have your home ready for sale, invite your friends and neighbors to a mock open house. Take your guests on a walk through of your home to practice your sales pitch and get their feedback on ways to make your home more attractive.
Setting a Price
Your starting price point is determined by the value of your home, your need to sell, and the conditions of your local housing market. If you are located in a buyers market and are in a hurry to sell, then you may have to agree to a price that is less than the appraised value. Many real estate agents recommend that you set the sale price of your home 5% to 10% above it's market value so any offers you receive will be close to the homes real value. It is also a good idea to set your price just below a whole number; for example $239,900 is better that $240,000. Many first time FSBO's will be tempted to overprice their home with the intent of giving themselves more bargaining room. This is a bad mistake to make because it will deter potential buyers from looking at your home. This strategy could also cause a mortgage rejection when the appraisal reveals that the house is over priced.
To determine your home's true value, contact a local property appraiser that has good knowledge of the area. Hiring a property appraiser to evaluate your home will cost under $300 and provide you with an extremely accurate price range. A cheaper way to determine the value of your home is by researching it's value on websites like Zillow.com. Be careful when using websites to evaluate your home because the value that they provide is often off by a substantial amount. In addition, you should review the listings for similar homes in your area to get a feel for local market conditions.
Marketing Your Home
Successfully advertising a home takes more than just one for sale by owner sign in the front yard. While for sale by owner signs are one of the best tools to use when selling a home, they should be combined with other efforts to increase their effectiveness. For sale by owner signs can peak the interest of people passing by and provide them with the information they need to contact you, but they can not get people to drive by your house on their own. Getting your home listed on the Multiple Listing Service (MLS), using online advertising, placing print ads, passing out brochures, and creating custom house for sale signs are some additional marketing activities that will drive traffic to your house.
Designing a Brochure
In order to write an effective advertisement for your home, remember to keep the wording short enough to be interesting but long enough to cover the important parts. Describe your favorite features of the home and list any recent improvements or upgrades. Look at the brochures of other houses if you are unsure about how to layout your information sheet. Pick up brochures that you see in info tubes and brochure boxes or collect information from local open houses. Use these brochures as templates when you design your own.
Add a picture or two of your home in different seasons to peak buyer interest. Ensure that your home is free of clutter before you take a photo. For outside shots remove bikes, garbage cans and parked cars. Inside you should move any knickknacks, keepsakes, or evidence of pets. Use a quality digital camera and take lots of pictures. This will give you several quality pictures to choose from and provide high pixel images that will look good when printed.
House for Sale Signs
Lawn signs are one of the most important marketing tools for home sellers. Professional looking for sale by owner signs will give your home an image of quality. Using cheap real estate signs may deter some buyers with worries that the buying process will be difficult and unprofessional. It is also smart to attach an information tube or brochure box to your house for sale signs. This gives potential buyers the opportunity to learn more about your property even if you are not around for a showing.
Use sign riders as directional signs to lead buyers to your property, especially if you do not live near a main street. You can also choose a more cost effective option by designing cheap real estate signs made out of corrugated plastic. Place these signs in your neighborhood to show buyers the way to your house.
When advertising your home online, you have the choice of websites that offer pay for posting and websites that are free to post on. Craigslist.com is a great resource that allows you to post for sale ads for free. MySpace.com is another free tool you can use to establish a web presence. Use MySpace to create a website for your house then network with Realtors and place your web address on all brochures or advertising. ForSaleByOwner.com and FSBO.com are websites that offer a variety of paid services.
The price of print advertising is calculated by the size of your ad so it is important to keep your print advertising short and to the point. Be sure to provide the critical facts buyers are looking for such as the house's number of bathrooms, special features, etc. Most home buyers quickly scan ads, so it is important that your house stands out. Used catchy headlines such as "Priced to sell", "Waterfront", or â€œNear downtownâ€.
Open houses are a great way to attract prospective buyers to your home. Sunday afternoons are the most popular time for open houses. Before holding your open house, look at open houses close by to learn more about local competition and get ideas for your big day. Start planning your open houses at least one month ahead and order your house for sale signs at least two weeks before the open house. Tie balloons to the sign to draw the attention of people looking for your open house. Place cheap real estate signs in the busiest intersections nearest your house with arrows to lead perspective buyers in the right direction. Remember to talk to your neighbors and ask them to pass the word along to family or friends who may want to move close by.
The Multiple Listing Service or MLS is a directory used by real estate professionals to advertise property that is for sale. Using the MLS will help market your home to real estate agents that have clients who are looking to buy a home. The only downside to this is that when a real estate agent finds you a buyer you must usually pay them a 2% to 3% commission.
Accepting and Declining an Offer
You should consult a real estate attorney when a home buyer makes you an offer. Many offers can be complicated and they often contain special clauses that favor the buyer. Remember that purchase price is not everything when evaluating an offer. Carefully consider the terms and conditions of the offer and watch for contingencies that favor the buyer or leaves loopholes.
Unacceptable offers should not be rejected outright. View the initial offer as the start of a conversation not the end. Have your attorney make changes to the original offer and present the perspective buyer with a counter offer.
Once you have accepted an offer the closing process will begin. This series of events usually takes between 30 to 50 days and can get very complicated. It is a good idea to have your attorney represent you during this long and often confusing process. The buyer's mortgage company will require your home to be inspected and appraised before the loan can receive final approval. Be ready to make any repairs of major problems that are uncovered during your inspection. Once the property has been inspected and appraised, the mortgage company will order a title search and property survey. This will ensure that property boundaries are correct and will identify any liens against your property.
The title insurance company or real estate attorney selected will handle all the details of the final closing process. There are significant costs involved in the closing process including the cost of title insurance, the appraisal, the survey, the inspection, lawyer fees, and more. The party who pays the closing costs depends greatly on where the sale takes place. The contract can also specify which party will cover the closing costs. During the final closing there are many steps that take place and a lot of money that changes hands. This process will include paying off the seller's current mortgage, deposit of a cashier's check for the exact amount due into an escrow account, paying of the closing costs, transfer of the deed, and the signing of all necessary documents. Once this is complete, the seller will give the buyer a set of keys to all of the locks in the house and the transaction will be done. You can expect to see the proceeds from the sale of your house the day or two after closing once the check has cleared escrow.
This for sale by owner guide only provides a general overview of the selling process. It is extremely important that you contact a real estate attorney in your area to review all local laws and customs before accepting any offer on your house. Each state has its own unique laws and customs can vary depending on what county or city you live in.
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