When working with Yigdigs to sell your house For Sale by Owner, there is a choice you have to make. Several options are available for Multiple Listing Service (MLS) packages. Frugal do-it-yourselfers have the option of taking the free route and registering for a basic package, which gets you a page that details a curb-side picture and a short listing description of the property–a nice package to have if you’re confident in your abilities as a seller and don’t need the attributes that other packages offer. Available options increase in both price and benefit, and in order to get the kind of listing to promote your home well and give you access to professional real estate expertise, the prudent seller may want to invest a bit.
With more features, such as access to Yigdigs.com’s online community of real estate professionals or Agent Access, the price of packages steadily increases, but one can rest assured, you are getting your value. A particular feature that I wanted to point out today, one which some of you may not be completely aware of, is the Agent Assistance tool. It’s only available with the premium packages and I want to explain how a feature such as this might benefit the For Sale By Owner.
Once you’ve gotten through the initial steps of selling your home (i.e. staging, and marketing) and you’ve got a few interested buyers, as the seller you will have to draft up a sales contract (I discussed this document at length in an earlier blog.) This document will detail the entire buyer/seller agreement—from asking prices to inspections to addendums and particular amendments on the legally binding agreement. This is a very, very important legal document, and one that first time and repeat FSBOs may not be completely familiar and comfortable with. In fact, in our recent case study, that’s exactly what our recent home sellers found the most challenging.
This is where the Agent Assistance feature comes into play. At these “real estate crossroads”, the assistance of a professional can be very beneficial. Agent Assistance will put you into contact with an experienced and reliable real estate professional that can advise and guide you through the complex matters of drafting a mutually beneficial Sales Contract. You will attain the expertise and value you require of a real estate professional while paying a single flat fee as opposed to hefty, blanket commission rates for unknown or questionable value.
This feature can also come in handy when moving the sale to the closing table. At this point the seller will be working in close contact with the buyer as they administer professional inspections and appraisals. Say, for instance, that the home is appraised at a lower price than the asking and the buyer wants to renegotiate. This will require changes to be drafted in the Sales Contract. The Agent Assistance feature can help you work through sticky legal matters efficiently with full legal knowledge at hand so you can get that Sales Contract to the title agent.
Other features are offered as well. Home reviews and rating, expert forums, live customer support, and listings with sister websites such as Realtor.com are all beneficial. But with every additional feature, the price increases as well. You get what you pay for and you have the power to choose. If the free listing doesn’t yield any hungry buyers, go ahead and bump your package up to the next option and see if a sponsored listing on Yahoo Real Estate, Craigslist, Tulia, or Zillow doesn’t help.
This MLS package is the service we offer. Yigdigs.com endorses the idea of selling your home FOR SALE BY OWNER, and this is precisely how it is done. You get all of the benefits of working with industry professionals and access to a wide, national network of home-buyers, sellers, agents, and attorneys all for a single fee for the package in place of a commission for a sellers agent, saving you thousands.
Archive for January, 2010
What’s the Deal with Agent Assistant?
Monday, January 25th, 2010Market Update: January 24, 2010
Sunday, January 24th, 2010Well, folks, I’ve been hearing and I’ve been seeing a lot of predictions for the real estate market in 2010. Most of it is good news to anyone invested in the housing industry—realtors are expecting to see sales begin to pick up again, the government is planning to take the real estate market off its life support system of tax rebate programs, and FSBOs can still relish in the fact that existing home sales are predicted to go up, especially since tax credits will continue well into the new year.
Sounds like a banner year. Still, though, certain aspects of our economy will not quite allow a full recovery. Realty Times, in their recent market predictions, cited the unemployment rate as a potential de-railer.
But we haven’t yet moved into the next phase nationwide – that of ‘job creation’, which may not begin until later in the year, he says, and may be a long, slow process.”
Also as mentioned earlier and echoed in the Housing Guru blog, the federal government will continue to fund incentive programs to sustain the housing market. Both the First Time Homebuyer Tax Credit and the Repeat Homebuyer Tax Credit, are set to be available through April 2010. Those who apply for the credit will receive its benefits through June.
They’ll also fight to keep mortgage rates as low as we have seen recently, but they can’t do so forever. In fact, they are planning to cease suppressing mortgage rates somewhere near March at which point the historically low rates will return somewhere near 6%. This could be bad for some homeowner who didn’t take the opportunity to lock in low mortgage rates when they had the chance.
All told, when the government finally stops resuscitating the market, it is widely expected that home sales will decline again.
Either way you look at it, it seems that were going to have at least half a year of solid market balance, with prices and rates rising and staying put, respectively. And FSBOs still have plenty of time to take advantage of the tax credits that have boosted existing home sales. It’s been, what, two years now since the catastrophic collapse in the housing market, and things have been lousy for a while. Time, it seems, heals all wounds, and 2010 is very much looking that way.
Why is Everyone Buying Houses Online?!?
Friday, January 22nd, 2010Everyone is buying houses online because…
Folks, I wish it were that easy to explain. Really, I do. But to be honest, to understand the inner workings of the industry, you have to get into the heads of the gears inside the machine: the buyer, seller and the realtor
Currently, with new home sales down and used home sales slowly coming back to life, realtors are finding that, if they want to continue their profession, they’re going to have to make some adjustments for the consumer, er, the buyer. Evidenced by a recent New Jersey Real Estate ruling addressing the prospect of giving buyers rebates, courts have ruled that brokers are now allowed to entice buyers with rebates (you can read the short of it here.) Of course, Garden Staters, don’t expect any plasma tv’s or Jaguar XKJ’s thrown in on your next real estate purchase. Rebates can only be in form of credit or check. New Jersey is now among the other 39 states that allow room for rebates within real estate transaction.
According to a Wall Street Journal article, “Traditional brokers counter that consumers need more service in a weak market and are willing to pay for it. Indeed, agents from BuySide and Redfin don’t drive buyers around to see houses. They leave the search work to their Internet-savvy customers, but help with making offers, negotiations and other technicalities of getting a real-estate deal done.”
Which brings up my next, very important, and decidedly punctual point: while many have turned to the MLS Flat Fee service such as Yigdigs.com, these types of companies are sweetening their deals to entice more buyers. Let’s be honest—it’s not the most active the housing market has ever been and while used home sales are doing better, they’re still not where they should be to sustain such an expanding market such as online real estate.
Listing packages offer services that connect you to real estate agents and other types in industry professionals. They do this so you can get the value of working with a real estate agent without paying the commission fees. Buyers and sellers use them because it has the potential to save thousands of dollars from avoiding commission fees. In an attempt to keep up with changing realtor practices, online real estate sites are now offering financial rebates as well. Sites like Redfin and Buyside now offer rebates on their limited services to entice buyers to adopt a do-it-yourself attitude.
So don’t be surprised to see future rebates offered on other MLS sites. That’s just another reason people are buying houses online.
Realcomp & the NAR vs. the FTC
Wednesday, January 20th, 2010An interesting development in the FSBO world: According to an archived article on real estate website Inman.com, the FTC has ruled that Realcomp, a Detroit-based MLS, can no longer maintain “exclusive agency” properties as privilege to Realcomp members and buyers working with a cooperating broker. The theory behind the ruling is that such exclusion from the public is “contrary to well-established legal precedent, and sound competition policy, and at odds with basic economic learning”.
They have requested that all exclusive agency listing be made public within 60 days. Realcomp, however, is refusing to cooperate.
Realcomp, with a considerable amount of backing from the National Association of Realtors, has been fighting this ruling for somewhere near three years now, and the recent deadline, it seems, has only hardened their resolve. They claim that complying with the FTC’s ruling would “result in harm to Realcomp members that cannot be quantified and will not be recoverable in the form of monetary damages or otherwise”. They have requested a stay in the Sixth Court of Appeals, and the FTC has denied that request.
Kudos to the FTC for trying to give run-of-the-mill homebuyers equal footing and access to the very same properties and resources that preferred members of real estate regularly enjoy. The outcome of this ruling doesn’t only effect homebuyers—sellers too, especially those that we hire to sell our homes. Certain brokers who were the only ones allowed access to these properties will now have to compete with everyone else out there in the market. As you can guess, they have good reason to be fighting the FTC’s request that those properties be made public.
The politics behind public listings and realtor-only access listings is quite a decadent topic when you really get down to it. Compliance on behalf of Realcomp seems to be the inevitable outcome here. What else can you do when you are backed into the corners? I do, however, see their qualm with the ruling. They offer exclusive services to exclusive members and agents, and making those listings public will completely change a platform in their business model, maybe even lose them some money. As far as a ruling, we shall see. I’ll be sure to keep the likes of your posted.
MLS Photography
Sunday, January 17th, 2010Ya’ll are going to love this. I lieu of yesterday’s blog post about MLS and the presence of such a charming, curb-appealing picture of that house smack dab in the middle of the post, I thought I would elaborate a little bit more on the importance of taking good pictures for your house.
Given that most of the real estate market has fallen upon hard times (the opposite could be argued for the FSBO market), the professional real estate photographers have found that, with an influx of homes foreclosing and going up on the market, they have more work all of a sudden.
As Scott Hargis, professional freelance real estate photographer told the Photopreneur Blog: “As the RE [real estate] industry has been tanking, I’ve found that my services are actually in greater demand than ever. I’ve raised my rates twice in the last two years with another increase likely this fall.”
Which goes to show you that real estate professionals are realizing that, in order to sell a home in this climate, you have to make it stand out and look good. Good photography is precisely the way to do that, and people are paying for it.
But as the For Sale by Owner, were looking to avoid as many of the “professional” costs as possible while still, at the same time, putting out a very professional looking product. In this case, our property listing would be the product and our pictures, the salesman.
It’s a simple philosophy really: your home will only look as good as you make it look. If you take pictures of cluttered rooms under pasty fluorescent lighting, your house will look more like an operating room than a home to the buyer. You want to give them something that they can see themselves living their life in. The best advice I can give is to hire a professional photographer to come out and do your home justice. They’ll know the specifics on lighting and cameras that will make your house look good. Not looking to pay for a photographer? Then get a shutterbug friend to take the pictures. Even as a hobbyist, they can make your house look thousands and thousands of dollars better.
It’s also important that you know the format your photo will be presented in online. Different sites display listings different ways and if you know ahead of time what kind of pictures the listing supports, you can gear your photo shoot towards that.
For some ideas on what not to do, I ran across a site that hosts a bad MLS photo of the day, called the MLS Trash Can, hosted by Orlando Real Estate Photography. There are some pretty appalling pictures that would hurt any listing.
My best advice to you is to go out in cyberspace and see what looks good. Look at professional photographer’s portfolios where available. You don’t have to master photography to take a good, professional picture, but a little research, time, and (if you’re willing) money never hurts.
Let’s Make a Listing!
Saturday, January 16th, 2010I figured that it was about time we look a little deeper into making a professional and attractive listing for MLS (Multiple Listing Service). There’s a lot of talk out there about the potential benefits of working with a flat fee listing services such as Yigdigs.com, and some of you may be asking, “Well, what exactly is going into this listing, and what can I get out of it?”
So I’m here to answer your questions.
Basically your listing is a personal ad for your property. And just like a personal ad you want to be honest and bring out the best in your property. Before making your listing, it’s probably a good idea to just make a general list of the unique benefits of your property. Two-car garage? Write it down. Brand new plumbing? Write it. Anything that can shine a positive, flattering light on your home makes great information for listings. Consider location to certain services or shopping centers, schools, and places to work. Is it a generally quiet neighborhood? Is it a great place to have a family? All of this can help make your home look like a buyer’s dream.
These positives will make your listing sparkle. Most of it should be used in the initial description of your property—the bit that sits right underneath the curbside picture of your property. If you sell your property short, then you will, inevitably, come up short on the pay-out.
Examine this particular house’s picture. Nice curb appeal. Charming landscaping and spotless exterior. This is a great picture. Now to back it up with a great mock-description.
(Let’s say that this house is located in Fort Collins, CO on historic Mountain St. about one block away from Poudre Elementary and City Park. During the summer months, the trolley cars stop right in front of the house, whisking people to Old Town (no more than 8 blocks away). In winter, the roads and sidewalks are maintained despite a frequent dusting of snow. The windows are insulated to retain heat in winter time keeping bills at a low cost. The house is a three bedroom/two bath with living area for entertainment, a recently furnished kitchen with a quaint dining nook. There is a basement attached to the sunken one-car garage that could be converted to more living space. Without the basement and garage, the square footage of the home is right around 1300 sq ft. Not the biggest house ever but, it makes up for lack of space in quaint, cozy-ness.)
Knowing that much we can present a pretty engaging description to whet the buyer’s whistle.
DESCRIPTION:
Located on historic and pristine Mountain St., this 3 BR/ 2 BA is perfect for families looking for a great community with a small-town feel. Only 8 blocks away from Old Town, the location is central to major shopping, business, entertainment, schools, and recreation centers such as City Park. With only a ten-minute drive to the foothills, you have easy access to the great outdoors.
1300 sq. ft make for a cozy and quaint setting to watch the winters from the kitchen’s adjacent dining nook. Brand new wood flooring and reinforced windows keep the house warm during winters with energy efficiency. Appliances and furnishings were recently updated. The backyard is picturesque for anyone who has appreciation for a natural setting.
Sounds good. And coupled with the picture, it seems almost too good to be true (in this case it is.) It’s that kind of appeal that For Sale By Owners should be going for in their listings. Make the home stand out from others. There are thousands of other homes out there for sale, and to entice potential buyers, supplying them with as much information as possible will make your home stand out from the rest.
Apart from the description, you’ll have to supply the buyer with specifics such as contact info, asking prices, locations, year built, school districts, etc.—things you should have ready to go before making your listing.
The more you put into your listing the more you will get out of it.
Converting For Sale by Owner
Friday, January 15th, 2010In my recent perusal of long lines of content out there in the online real estate world, I have become privy to a startling fact. We are at war. As a community of do-it-yourselfers, righteously biting our thumbs in the face of an industry running on the expertise of “qualified” professionals, FSBOs are the underdogs. Our rivals: the realtor.
It has come to my attention that they feel a threat brewing in the quiet neighborhoods and online forums dedicated to the For Sale By Owner pursuit.
From Jeff Christiana, broker/owner of Prudential Manor Homes in 2008:
“If you go back eight or 10 years ago, the whole theory was the Internet was going to put real estate agents, travel agents and car dealers out of business because [buyers] didn’t need us.”
This is a widely shared sentiment among real estate professionals, and in order to combat this “theory” that Mr. Christiana surmises, the real estate industry has struck back. It comes in many forms. Some FSBO’s might notice an overly friendly and helpful realtor showing up at FSBO open houses. Some might find themselves receiving newsletters or even being offered a host of “free services”. And it all seems very cordial and nice, but beware.
As a For Sale By Owner, we are seen as specimen—an opportunity. The real estate companies hold a special place in their hearts for the likes of us. It is both mutual respect and financial circumstance. We have become a market.
As detailed in Realtor Magazine, in last year’s archives, the NAR has festooned the pages of this site with what I can only call a battle plan. Entitled, “Sales Meeting Tool Kit: Converting FSBO’s,” this tool kit highlights pretty much every angle that a realtor has at converting, or at the very least, sucking some kind of money out of the FSBO. Now I know that these realtor-types have to make a living—that I understand. It’s precisely why I’m here writing this. But it seems to me that there should be some degree of separation available to FSBO’s to prevent those over-eager realtors from meddling with their devices. It’s a trend that I have been seeing—especially in the article about Jim Gillespie.
So here it is. The same way the government accidentally put the TSA security guide up online, I will post the guide that will make all FSBO’s aware of the assault that realtors have planned for us.
The Sales Meeting Tool Kit: Converting FSBO’s
If any of you should decide to dig into this at all, I would like point something out. The main drive for realtors to capitalize on FSBOs is their belief in our inability. In component 4 of this enormous tool kit, the NAR takes a moment to emphasize on a schedule of solicitation.
A series of letters, calls, and appearances is recommended to keep the realtor consistently involved on some level while the home is being sold by the owner. But here’s what is recommended under Week 5 of Operation Solicitation:
“Continue contact: A mixture of phone calls and weekly or biweekly visits are essential to staying in touch. If the FSBOs have agreed to pay a co-op commission, call the FSBOs to update them on your buyer’s feedback. Putting FSBOs on your regular newsletter or e-mail contact list is also helpful in keeping your name in front of them.“
Monitor mood and act when you see a shift. You need direct contact to monitor when a FSBO might be ready to list, so try to call or drop by weekly. Other indicators of discouragement might be not advertising or holding open houses. In extreme cases, a FSBO might take the home off the market.”
The whole tool kit is littered with this kind of lack of faith in the FSBO. In fact, at times, it operates upon an utter certainty of failure:
“You will often need several weeks of contact before you can convert a FSBO to a listing. Once they’ve spent some time trying to sell their homes, FSBOs are often more receptive.”
“Sunday—after a discouraging weekend with no offers—is a good time to call or drop and try to get the listing.”
Where’s the faith, realtors?
Well, now you know. It’s a dog eat dog world out there and right now, real estate professionals are really hungry (especially since new home sales are on the decline right now.) Read, if you will, and prepare yourself for the realtor’s jaunts at getting another listing and more commission from the For Sale By Owner community.
The Times They Are A-Changed
Monday, January 11th, 2010Many of you out there in the real estate world have heard of the real estate giant Coldwell Banker Real Estate LLC. Well, I have stumbled upon an interesting tidbit about their CEO Jim Gillespie. Realtor Magazine’s Michelle Hofmann had a chance to sit down and interview the man himself and talk to him about his first real estate transaction that eventually launched him into a career in real estate.
Here’s a link to the article.
What stuck with me from this article is that fact that he called himself the “FSBO king of La Grange”. He started his career focusing on converting For Sale By Owners to list with him, and he was quite successful at it. He repeatedly visited sellers in hopes that they would eventually list, and many of them did. But this, however, was back in the 70s…
It’s now forty years later, and we have such advancements like, say, the Internet, that might give us a certain advantage to real estate transactions from more than thirty years ago. Now available are an endless amount of Multiple Listing Services, Agent Assistant, and a massive network of real estate professional online. Not to mention an in depth series of FSBO video tutorials that give you all of the information you need to sell, sell, sell. All of these amenities at your fingertips too…
Times have changed, and while Mr. Gillespie found it easy to sway FSBO’s back in the day, he may be up against a whole new animal today.
The Homebuyer Tax Credit Means EVERYTHING!
Saturday, January 9th, 2010…Well, maybe not everything, but a considerable amount. For For Sale by Owners, this little tax credit has poked and prodded what would have otherwise been a dormant market for used home sales into a stirring, still sleepy-eyed, state of arousal.
In the last couple months’ estimates, used home sales have continually been on the rise, while new home sales have—much to the dismay of real estate professionals—slumped heavily, sometimes hitting double digit marks in the negative. Luckily for FSBO’s, this tax credit has been extended well into the spring of 2010. So you can count on those numbers to remain effectively high for some time.
But, in a recent article, Les Christie (my personal favorite real estate writer for CNNMoney.com) has cited that home prices as well as mortgage rates are expected to drop and expand respectively. Lawrence Yun, chief economist at the NAR has quoted a 3% “price improvement” in 2010, that is, until the wind goes out from the housing market sails. Compounding the end of the tax credit with increased foreclosures, and rising interest rates (due to an end to programs supporting mortgage-backed securities), the housing market is expecting to slip back into deflated home prices and higher mortgage rates of up to 6%.
The federal government has certainly done their part in their support to revive the market and their programs have obviously had a very positive effect. Unfortunately, those programs, like dreams, cannot last forever. So, FSBO’s, strike while the iron is hot and take advantage of this tax credit, because professionals are predicting a not-so-good mid year.
About Sales Contracts
Monday, January 4th, 2010Okay FSBO’s, were going to do a short clinic today on the kinds of paperwork that many of our first time sellers should get familiar with.
When selling a house, there is always a fair amount of legal documentation involved. As a buyer, there is a great deal more of paperwork to handle than the seller. When buying, you’re dealing with documents like affidavits, agency agreements, and mortgage agreements, not to mention all the lender paperwork that goes along with obtaining a mortgage. But if you’re selling a property from a For Sale by Owner point-of-view, you really only need to be aware of a singular important document: the Sales Contract.
The Sales Contract (or Offer to Purchase from the buyer) is the document that will address nearly 90% of the sales process. A standard contract is drafted to cover almost any aspect that selling a house could involve. It lists the property in question, the asking price and covers items such as warranties on the property, inspections, exclusions, arbitrations and insurance. Addendums, which are like additions to the contract, are also included to address specific issues within the selling of the property such as a 3rd party financing addendum and a lead based paint addendum which applies to houses built before a certain date. Amendments can also be made to the sales contract for particular repairs needed after inspections, as well as lease back forms should buyers need to move in prior to in the closing date.
Another helpful and usually required little piece of paperwork that sellers should familiarize themselves with is the Seller’s Disclosure Form. This form will list everything that is, and possibly could be, wrong with the property in question. Even though this is separate form, the need for the form is specified in the Sales Contract.
Keep in mind that sales contracts have different stipulations from state to state. Make sure you research any state specific requirements beforehand.
Once you have the Sales Contract in hand from the buyer, the majority of the paperwork now applies to the buyer. All the seller has to worry about is transferring the title of the property over to the buyer when closing. The title company will receive the Sales Contract and manage the closing process. It’s a common misconception that you need a real estate agent to interface with the title company regarding the closing documentation but the truth is that your title company is more than capable of handling all of the documents. In fact, title companies are your friends. They only get paid if the deal closes so they want to keep it on track as much as you do.
And once you’ve released that title, it’s time to reap the benefits!
