The Homeowner's Guide to For Sale By Owner: Everything You Need to Know to Sell Your Home Yourself and Save Thousands

By Jackie Bondanza

American homeowners have seen real estate landscape change in recent years. The market seems gloomy now, but for sale by owner (FSBO) properties are booming with more people eager to cut out the commission of real estate agent. And with most U.S. cities having buyer’s markets, you have to go that extra mile to sell your home. Now, there is a book to show you how.

The Homeowner’s Guide to For Sale By Owner details each benefit FSBO brings and explains how you can accomplish this task while saving money. Now, selling your home without a realtor or broker will be fast and easy. You will learn the entire FSBO process. You will learn how to set the sales price and how to save the 6 to 8 percent real estate commission, which can add up to thousands or tens of thousands of dollars in savings.

You will learn how to stage your home for a showing and have a professional appraisal and home inspection to ensure a successful sale. You will learn how to market, advertise, and show your home, list your home for sale on the Internet or local multiple listing service (MLS), host an open house, and develop and market a fact sheet. If selling your home is on your list of things to do, do not let the current market deter you: Let this book be your guide to saving money and selling your house the FSBO way. The companion CD-ROM is not available for download with this electronic version of the book but it may be obtained separately by contacting Atlantic Publishing Group at [e-mail].

Atlantic Publishing is a small, independent publishing company based in Ocala, Florida. Founded over twenty years ago in the company president’s garage, Atlantic Publishing has grown to become a renowned resource for non-fiction books. Today, over 450 titles are in print covering subjects such as small business, healthy living, management, finance, careers, and real estate. Atlantic Publishing prides itself on producing award winning, high-quality manuals that give readers up-to-date, pertinent information, real-world examples, and case studies with expert advice. Every book has resources, contact information, and web sites of the products or companies discussed.

This Atlantic Publishing eBook was professionally written, edited, fact checked, proofed and designed. The print version of this book is 288 pages and you receive exactly the same content. Over the years our books have won dozens of book awards for content, cover design and interior design including the prestigious Benjamin Franklin award for excellence in publishing. We are proud of the high quality of our books and hope you will enjoy this eBook version.

• Language: English
• Publisher: Atlantic Publishing Group Inc.
• Release date: Feb 19, 2010
• ISBN: 9781601386397

Book preview

The Homeowner’s Guide toFor Sale By Owner:

Everything You Need to Know to Sell Your Home Yourself and Save Thousands

By Jackie Bondanza

The Homeowner’s Guide to For Sale By Owner: Everything You Need to Know to Sell Your Home Yourself and Save Thousands

Copyright © 2010 Atlantic Publishing Group, Inc.

1210 SW 23rd Place • Ocala, Florida 34471 • Phone [phone] • Fax [phone]

Web site: www.atlantic-pub.com • E-mail: [e-mail]

SAN Number: 268-1250

No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without the prior written permission of the Publisher. Requests to the Publisher for permission should be sent to Atlantic Publishing Group, Inc., 1405 SW 6th Avenue, Ocala, Florida 34471.

Library of Congress Cataloging-in-Publication Data

Bondanza, Jackie, 1980-

The homeowner’s guide to for sale by owner : everything you need to know to sell your home yourself and save thousands / by Jacqueline Bondanza.

p. cm.

Includes bibliographical references and index.

ISBN-13: 978-1-60138-127-9 (alk. paper)

ISBN-10: 1-60138-127-1 (alk. paper)

1. House selling--United States. I. Title.

HD259.B65 2010

643’.120973--dc22

2008035305

LIMIT OF LIABILITY/DISCLAIMER OF WARRANTY: The publisher and the author make no representations or warranties with respect to the accuracy or completeness of the contents of this work and specifically disclaim all warranties, including without limitation warranties of fitness for a particular purpose. No warranty may be created or extended by sales or promotional materials. The advice and strategies contained herein may not be suitable for every situation. This work is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional services. If professional assistance is required, the services of a competent professional should be sought. Neither the publisher nor the author shall be liable for damages arising herefrom. The fact that an organization or Web site is referred to in this work as a citation and/or a potential source of further information does not mean that the author or the publisher endorses the information the organization or Web site may provide or recommendations it may make. Further, readers should be aware that Internet Web sites listed in this work may have changed or disappeared between when this work was written and when it is read.

All trademarks, trade names, or logos mentioned or used are the property of their respective owners and are used only to directly describe the products being provided. Every effort has been made to properly capitalize, punctuate, identify, and attribute trademarks and trade names to their respective owners, including the use of ® and ™ wherever possible and practical. Atlantic Publishing Group, Inc. is not a partner, affiliate, or licensee with the holders of said trademarks.

The Realtor name and logo is a registered service mark and property of the National Association of Realtors Corporation.

The Assist-2-Sell name and logo is a registered service mark and property of Assist-2-Sell, Inc.

A few years back we lost our beloved pet dog Bear, who was not only our best and dearest friend but also the Vice President of Sunshine here at Atlantic Publishing. He did not receive a salary but worked tirelessly 24 hours a day to please his parents.

Bear was a rescue dog who turned around and showered myself, my wife, Sherri, his grandparents Jean, Bob, and Nancy, and every person and animal he met (well, maybe not rabbits) with friendship and love. He made a lot of people smile every day.

We wanted you to know a portion of the profits of this book will be donated in Bear’s memory to local animal shelters, parks, conservation organizations, and other individuals and nonprofit organizations in need of assistance.

– Douglas and Sherri Brown

PS: We have since adopted two more rescue dogs: first Scout, and the following year, Ginger. They were both mixed golden retrievers who needed a home.

Want to help animals and the world? Here are a dozen easy suggestions you and your family can implement today:

Adopt and rescue a pet from a local shelter.

Support local and no-kill animal shelters.

Plant a tree to honor someone you love.

Be a developer — put up some birdhouses.

Buy live, potted Christmas trees and replant them.

Make sure you spend time with your animals each day.

Save natural resources by recycling and buying recycled products.

Drink tap water, or filter your own water at home.

Whenever possible, limit your use of or do not use pesticides.

If you eat seafood, make sustainable choices.

Support your local farmers market.

Get outside. Visit a park, volunteer, walk your dog, or ride your bike.

Five years ago, Atlantic Publishing signed the Green Press Initiative. These guidelines promote environmentally friendly practices, such as using recycled stock and vegetable-based inks, avoiding waste, choosing energy-efficient resources, and promoting a no-pulping policy. We now use 100-percent recycled stock on all our books. The results: in one year, switching to post-consumer recycled stock saved 24 mature trees, 5,000 gallons of water, the equivalent of the total energy used for one home in a year, and the equivalent of the greenhouse gases from one car driven for a year.

Author Acknowledgments

A special thanks to Alex Ramirez of 1st Continental Mortgage, Erica Ramus, Tim Carter of www.askthebuilder.com, Barry Wardell of Assist-2-Sell, John Henderson of JT Henderson and Associates, Elizabeth Sagarin of Elizabeth Sagarin Photography, Walter Hall of HouseSavvy, David Wind of Guaranteed Home Mortgage, Anthony Castillo of Homes on Mobile Phones, Bob Tubbesing of Convenience Products, Robert Lattas of Lattas Law, and all the Case Study participants. Your knowledge and eagerness to share it made this book possible.

I would also like to thank Atlantic Publishing Group, Inc., and my editor, Kim Fulscher, for her guidance, patience, and support.

Table of Contents

Foreword

Introduction

CHAPTER 1: What You Should Know Before You Go FSBO

CHAPTER 2: Doing Your Research and Knowing Your Market

CHAPTER 3: Determining If FSBO is For You and Knowing What to Avoid

CHAPTER 4: Preparing Your House for Sale

CHAPTER 5: Determining Your Price

CHAPTER 6: Listing Your Home

CHAPTER 7: Staging Your Home

CHAPTER 8: Marketing Your Home

CHAPTER 9: Running an Open House

CHAPTER 10: Handling Offers and Working with Buyers

CHAPTER 11: Handling Contracts and Other Documents

Conclusion

Glossary

Bibliography

Author Biography

Foreword

The rules of the real estate game have changed since the mortgage meltdown of 2007. Selling your home today is completely different than it was just two years ago because the market has shifted from a seller’s market to a buyer’s market. If you want to be successful at selling your home for the highest price possible, follow the advice outlined in this book. Jackie Bondanza has written an updated guide to selling your home yourself — commonly called For Sale By Owner.

Times have changed. In a seller’s market, you could simply stick a For Sale sign in your front yard and wait for the offers. I did this myself: I placed a For Sale sign in the front yard, held just one open house, and sold it soon after. There were two people competing to buy my house, and I was able to interview them and choose the one who had the stronger financial picture. The method I used to sell my house in 2004 will not work now. Today, you need new methods and advice. This book will guide you through the process from start to finish.

Start by understanding the current housing market and what factors gave rise to our current financial crisis. Bondanza discusses the history of housing over the last 20 years and compares past housing crashes to today’s crisis in Chapter 1. This information is crucial to understand what is happening with your neighbor’s house that might have just gone to foreclosure or is being sold by a bank.

With the proper tools and education, you can save thousands of dollars and control the whole transaction from start to finish. This book will guide you in knowing which professionals you can partner with for free to help you market and sell your home.

You will find case studies from industry professionals in each area of the book. These will add insight from people working in the field every day. You also receive a CD-ROM with all the needed legal forms to sell your house. The information contained on the CD-ROM could normally cost you hundreds of dollars and much time to get all the correct and updated forms.

As a Certified Mortgage Planner and Branch Manager for Primary Residential Mortgage, Inc. in New Castle, Delaware, I found this book to be a serious step-by-step guide for how to sell your house. I work with For Sale By Owners in Delaware and Maryland to help them sell their homes quickly and for the highest price possible. It took me years to learn half of the information contained in Bondanza’s book. I now recommend all of the FSBOs who contact me to get a copy of this book.

The Homeowner’s Guide to For Sale By Owner is your complete handbook that will take you from For Sale to Sold.

John R. Thomas, BA, MEd
Certified Mortgage Planner


Primary Residential Mortgage, Inc.

www.DelawareMortgageLoans.net

Table of Contents

Introduction

Regardless of how you sell your house, where it is located, or what kind of market it is, selling your house is a big task that requires a significant investment in time, patience, research, and — quite often — money. Optimizing the amount of profit you receive from the sale is the ultimate goal, which is why the concept of selling on your own home versus enlisting the services of a real estate agent is becoming increasingly popular.

By definition, For Sale By Owner, or FSBO, is the process of listing a property on the market and selling it without the use of a real estate agent to represent that property. Real estate agents serve the purpose of representing properties to potential buyers and managing the sales process, which includes advertising; marketing; hosting open houses and private showings; negotiating, drafting, and advising on contracts and other required paperwork; and coordinating the closing process. An agent’s job, in general, is to act on behalf of a seller to oversee the selling process and manage all communication on behalf of the seller.

The concept of buying and selling real estate has existed for centuries, as people learned the value of trading land. The role of the real estate agent evolved out of this concept, and organized associations of real estate agents dates back more than a century. In 1908, the National Association of Realtors was founded. It later changed to The National Association of Real Estate Boards in 1916, then finally the National Association of Realtors in 1972. The association has since grown to include hundreds, if not thousands, of local chapters for each community across the country.

Like many careers, the role of the real estate agent has shifted and evolved with time. Although agents are required to be licensed and to pass a series of tests to become an agent, some agents are not qualified to effectively handle the process of selling your house on your behalf. This is one of the main reasons homeowners choose to sell on their own as opposed to listing their houses with a real estate agent.

Other reasons FSBO sellers choose to sell on their own include a desire to save the commission fee for an agent. Some sellers will choose to offer a commission to any real estate agent who brings in a buyer. Yet others will enlist the services of a discount brokerage or similar service to aid them in one particular part of the selling process.

Whatever your intentions for deciding to sell FSBO, The Homeowner’s Guide to For Sale By Owner: Everything You Need to Know to Sell Your Home Yourself and Save Thousands and the accompanying CD-ROM will take you through all the necessary steps to successfully sell your house on your own. This easy-to-read guide will provide you with crucial, detailed information on preparing your home for sale, listing your home, marketing and advertising your home, creating a comparative market analysis to determine a listing price, dealing with buyer’s real estate agents, gauging the market in your local community, and enticing buyers.

The chapters in the book follow the process of selling your house as it would naturally unfold, beginning with a history of the real estate market and the housing market crash of 2008 and determining if FSBO is for you, and ending with the closing process and things to avoid when selling FSBO. The CD-ROM includes all the necessary common real estate forms you will need along the way, downloadable with the click of your mouse.

In addition, The Homeowner’s Guide to For Sale By Owner outlines specific instructions on how to draft a contract that protects your interests, what contingencies to include, how to offer seller concessions, and what to do if your home is not selling. This book will also discuss using discount brokerages and other services to help you sell, and it presents the pros and cons of selling FSBO, which lets you determine if this is the right method is for you.

With so much information available on the Internet — and so many Web sites and companies targeting FSBOs — it is imperative you have the right information to make informed decisions during the home-selling process. There are many people, mostly professionals in the real estate industry, who will attempt to discourage any seller from selling FSBO — but these are mostly real estate agents who want listings. After all, this is how they make their money. Others, like real estate attorneys, have seen the legal ramifications of the uninformed seller who does not include any protective clauses in his contract and ends up losing thousands in a sale that goes bad.

The reality is that selling FSBO can be extremely profitable and could potentially save you thousands of dollars if you are smart about how you go about the process, and if you are an informed homeowner. You must be willing to invest the necessary amount of time and research to make the process as smooth, convenient, and beneficial for all parties involved as it can be.

FSBO is not for everyone, but The Homeowner’s Guide to For Sale By Owner demonstrates just how easy and profitable it can be to sell your home on your own. Good luck.

Table of Contents

CHAPTER 1: What You Should KnowBefore You Go FSBO

Before you decide to sell on your own instead of listing your house with a real estate agent, there are many factors to consider. Do you have the time to host open houses and devise a marketing strategy? How about creating fact sheets and taking pictures of your house to include in your online listing? Are you familiar with contracts and comfortable negotiating with buyers? This chapter is dedicated to a discussion of these issues and to weighing the pros and cons of selling your house on your own.

Understanding the Real Estate Market

The laws of supply and demand govern the real estate market, like anything available for purchase. Naturally, if there is plenty of supply and not as much demand, prices will be lower. If there is a high demand for a product and it is in short supply, prices will be higher.

When demand and prices are high, the market is referred to as a seller’s market, because the seller has a product that is in demand and therefore holds more of the power than a buyer does. In the opposite kind of market, a buyer’s market, the buyer holds the power because demand is much lower, and sellers are at the mercy of the demand, or the buyers. After the housing market crash of 2008, most areas of the nation became a buyer’s market because so many homeowners were forced to sell their house as a result of financial issues caused by the housing and mortgage crisis.

Trends in the market

In order to grasp where your house stands in the big housing picture, it is important to research and understand the real estate market on a national as well as a local level.

On a national level, the housing market has changed dramatically since late 2008 as a result of the recession and the general state of the economy.

During the early 2000s, real estate sales boomed as the government slashed interest rates, and banks and mortgage lenders made it very easy for buyers to obtain mortgages. According to The Boom and the Bust of the U.S. Real Estate Market: What Went Wrong and the Lessons We Learned by David S. Bunton of the Appraisal Foundation, there have been two real estate booms in the past century: the first following World War II, and the second between 2000 and 2006. The housing collapse of the 1980s and early 1990s deserves mention as well as one of the more significant time periods for real estate.

The first housing boom following World War II was stimulated when thousands of people returned from war in the hopes of pursuing the American dream and buying a home. The number of homeowners across the United States has steadily grown since this boom many decades ago, and the percentage of people who own their own home peaked at nearly 75 percent just before the housing market soured beginning in 2007.

In the decades following World War II, the real estate market hit peaks and valleys but remained relatively steady until the 1980s, when the market took a steep nosedive. During the early part of this decade, many economical factors began to change that contributed, at least in part, to the downturn in the real estate market. First, demand for commercial real estate for business and commercial development led to overdevelopment in many areas of the country, leaving many investors and developers unable to recover funds. Secondly, under then-President Ronald Reagan, small businesses boomed prior to this era as more Americans invested money in starting their own business. When many of these businesses failed, owners who had invested the majority of their personal finances and property in the business lost everything, including their homes, thus pushing foreclosure rates to triple during this time.

In addition to business failings, declining home values due to a lower inflation rate also contributed to the foreclosure rate. In the years leading up to the 1980s, inflation drove up the value of real estate across the board. The Federal Reserve, the arm of the government that regulates the banking system, had minimized the high inflation rates of the previous decade, which ultimately led to decreased home values. Credit card use also began to rise during this decade as more and more homeowners used more credit and saved less. Another contributing factor to the housing market collapse of the 1980s was the de-regulation that large businesses, corporations, and banks enjoyed during Reagan’s presidency. Since these businesses were not held accountable to the government in many ways, consumers were much less protected.

Perhaps the most significant catalyst for the housing collapse of the 1980s was the failure of the savings and loan (S&L) institutions to provide loans and mortgages to the public. S&L institutions were banks that offered low-interest loans that were FDIC-insured. The Federal Deposit Insurance Corporation, or the FDIC, is an agency established by the federal government to insure money in national banks and other financial institutions. During the early 1980s, the government eased

Reviews for The Homeowner's Guide to For Sale By Owner

[heatherms · Rating: 4 out of 5 stars]

“The Homeowner’s Guide to FOR SALE BY OWNER” was written by Jackie Bondanza about what a homeowner can do to sell their home. It is directed towards people who wish to sell their home by themselves and not with a realtor. But if you are using a realtor, then this book is just as important for you. The information given is applicable to both the person selling on their own and those selling using an agent.The book covers many areas such as “Selling in a Buyer’s Market versus a Seller’s Market,” how to price your home, getting the home ready to show, marketing your home, and how to handle the contracts and documents which are part of every sale.Although this book states in the title that it is for those who wish to sell on their own, this book is just as relevant to the person who chooses to go through a real estate agent. I really liked the part of the book that discussed how to stage your home. The author covers the living room (i.e. to arrange furniture around the fireplace to help accentuate it”, the kitchen (which can make or break a deal), the master bedroom, extra bedrooms, the dining room, the bathrooms, entrances and exits and also how to stage a home office or basement if you have them. She even gives hints on the proper way to photograph your home and the common mistakes that sellers do when photographing their home and which pictures you should put online. At the end of the book she covers the costs associated with selling the home such as which costs are typically paid by the buyer, the seller and which fees are negotiable that can be paid by either.This book is chock full of information and would benefit any person who wishes to sell their home. It can help take some of the anxiety out by providing the seller the information that is needed to get their home. It is written so that it does not overwhelm the reader. My only complaint is the CD-ROM that came with it. I have Microsoft 2010 on my computer and I was unable to pull up any of the documents on the CD-ROM. This was disappointing since the information on it included Contract of Offer and Acceptance, Deed of Sale, Buyers Purchase Agreement, and other documents that the seller will need to know about. The good news is that you don’t need the CD-ROM to benefit from the information in this book.

[iwatson_39 · Rating: 4 out of 5 stars]

The author of this book is neither a real estate agent or broker nor does she give any indication that she has sold her own home. Her expertise is freelance writing and helping others develop books. After reading the bio I wondered how good this book would really be.The author did do research and does give much information for the first time seller of his or her own home. Being in real estate myself and selling many homes through an agent or on my own I felt that the information given is valuable and correct. I also feel that if the homeowner followed the suggestions, especially the staging aspects, that success could be achieved.There are many aspects to consider when selling a home and I'm sure that after reading this book the seller will be able to decide if the savings of money selling the home oneself would outweigh the expertise of an agent.I do recommend this book, not only for those contemplating selling their own home but those using a real estate agent. I'm sure you'd glean information that your agent didn't or isn't going to tell you.