Tuesday, September 30, 2014

Home Seller Sweepstakes Winner Profile: Diane and Larry Wermers

This summer, ForSaleByOwner.com held its inaugural Home Seller Sweepstakes, a promotion celebrating successful by-owner home sellers. Three lucky winners were each awarded 6 percent of their home sale price the equivalent of what they saved by not having to pay a real estate agent's commission. Here we profile our July Home Seller Sweepstakes winners, Diane and Larry Wermers of Rapid City, South Dakota.

Diane and Larry Wermers are no strangers to DIY real estate sales; in fact, of the six homes they've sold over the years, two have been by-owner transactions. As Larry puts it, "We've paid more than $100,000 to real estate agents, and we were fed up with it."

Diane explains: "The last property we sold was on a lake in a resort area. We listed it with three different real estate agents and had no response. That was when we decided to do it on our own."

For their most recent home sale, a ranch home in Rapid City, South Dakota (pictured above), the Wermers found ForSaleByOwner.com through various online real estate searches. "The site would come up as I was searching the Internet for homes to buy over the years," Larry says. "We liked the fact that potential buyers would also be able to find our home on ForSaleByOwner.com." The couple even went one step further: They placed an ad in their regional newspaper highlighting their ForSaleByOwner.com listing ID.

Because of their background selling various properties, the Wermers felt comfortable with the process and the professionals they've worked with. "We have a personal relationship with our local title company, which we've used for each of our home sales," Diane says. They advise other by-owner sellers to also assemble a solid team of pros. "Find a good lender who is willing to work with individuals," Larry says. "Often lenders would rather work directly with sellers and buyers than with real estate agents who can sometimes get too involved, so to speak." Diane also recommends seeking the services of a trusted attorney to handle paperwork and other legal questions.

Diane admits that she ignored ForSaleByOwner.com's Home Seller Sweepstakes at first. "The second time I saw it, I figured, why not enter," she says. The couple was also hesitant when they found out they had actually won. "I couldn't believe it," says Larry. "I thought it was a scam!" Their winnings will go toward a nest egg for their new home. "And adding to our savings would be nice, too," Diane mentions.

Their win continues somewhat of a lucky streak for the Wermers. Back in 1989, Larry won a pickup truck through a contest at work. "I then sold the truck and bought a house," he says with a chuckle.

Friday, September 26, 2014

DIY Decorating: 8 Ways to Warm Up Your Home this Fall

These do-it-yourself fall decorating tips will help you spice up your home and heat up interest from buyers.

According to a poll conducted by YouGov, fall is the most popular season among Americans. Whether you are looking to stage your home for sale or just surround yourself with the sights and smells of your favorite season, making your house an autumn oasis is easy with just a few simple suggestions.

1. Pick Your Fall Color Palette
Finding a color palette that works with your home and furnishings while utilizing the earthy tones of the season is the crucial first step to decorating for fall. The Perfect Palette offers 5 fabulous fall color palettes that you can experiment with, but you can get started by playing with variations of these shades to find a color palette that works for you:
  • Orange
  • Purple
  • Brown
  • Cranberry
  • Mustard
  • Black
  • Beige
  • Gray
2. Switch Up Your Fabrics
Once you have determined your palette, start removing and storing your lightweight summer fabrics, such as cotton or linen, to replace them with thicker materials like velvet or wool. Add some accents with pillows and throws.

3. Fresh Floral Designs
Some of the flowers that define the colors of the season include daisies, sunflowers and chrysanthemums. Filling your home with floral arrangements that match your color palette is a simple and inexpensive way to decorate.

Gourds and pumpkins can serve as great natural vases and can be painted to create your own unique patterns. Orange Gerber daisies and chrysanthemums peeking out from a pumpkin is just one of the easy fall and Halloween flower arrangements we liked from Better Homes and Gardens.

4. Deck Out the Walls
Welcome your guests by decorating walls in your foyer and entryway with fall sentiments. Find some inexpensive small frames at garage sales, thrift stores or online that you can fill with fun seasonal sayings, photographs and pressed leaves.

5. Dining Room Decorations
You can create unique decorations for your dining room using the branches and leaves found in your yard. Using vegetable glycerin or decoupage to preserve fall leaves and branches, creating a centerpiece for your dining room table or an artistic mobile that hangs from the overhead lighting is simple.

6. Inviting Lighting
If you have a fireplace, now is the perfect time to clean out any soot and debris that have accumulated since it’s last use. If you don’t have a fireplace to help warm and welcome, you can collect an array of fall-scented candles to provide inviting lighting for guests and buyers.

7. Seasonal Smells
Speaking of scented candles, you can fill your home with lovely fall scents that appeal to buyers. Some of the most universally appealing aromas associated with autumn include peppermint, apple and cassia (smells like cinnamon).

8. Exterior Appeal for Autumn
In addition to performing the routine maintenance necessary to keep your home looking it’s best in the fall, you can try planting some of the aforementioned fall flowers, especially chrysanthemums. A fresh coat of paint in a vibrant fall color with a DIY wreath made from the foliage in your yard can be a great adornment to attract house hunters.

Once you have your fall decorations all lined up, do you know how to arrange them? Look at 6 simple staging tips for fall to help you close before the holidays.

Thursday, September 25, 2014

Good Housing Market Brings More Willingness to Sell By Owner

As the peak home selling season drew to a close in August, indicators such as price increases, time on market and decreased distressed home sales point toward a “good” housing market. As seen in a recent ForSaleByOwner.com survey, these factors also indicate an increased willingness to sell by owner.

August 2014 Existing Home Sales
According to an August report, after four months of consecutive increases, existing home sales fell slightly for the month, down 1.8 percent from July. Despite the dip, August still saw 2014’s second highest seasonally adjusted annual rate with 5.05 million existing home sales, just behind July with 5.14 million.

The decrease in sales was due primarily to a decrease in purchasing from cash investors, who also helped to raise prices throughout the year as regular buyers attempted to compete with their cash offers to sellers. As good news to potential homeowners, this decrease will allow them an increased opportunity to purchase.

As a share of the total number of existing home sales, August saw the lowest levels of foreclosures and short sales since the market crash in 2008. Distressed sales reached single-digit numbers for the first time since October 2008 in July and August continued the decline with numbers reaching 8 percent.

Time on market was up slightly from July’s numbers with a median of 53 days compared to 48 days, a number that is still down roughly 26 percent from December 2013 when the number of days on market was up to 72. In August, roughly 40 percent of homes were on the market for less than a month.

Inventory levels remain at a healthy, competitive number. August saw 2.31 million existing homes available on the market, which at the current sales pace equals roughly a 5.5-month supply.

1 out of every 2 sellers are more willing to sell by owner in a good housing market
With August data consistent with what analysts could determine is a “good” housing market, we asked ForSaleByOwner.com customers to describe their willingness to sell by owner. Of eight hundred respondents, the majority (55 percent) said that a good housing market would make them more likely to consider selling by owner. Additionally, 37 percent of sellers stated that a good housing market would have no impact on their willingness to continue selling by owner while only 9 percent said that they would be less willing.

In addition to measuring the impact that the quality of the market would have on those selling by owner, the survey also asked sellers to provide further insight into how and why the market would impact their willingness.

Sellers stated that saving on commission fees and receiving increased exposure were driving forces in choosing to sell by owner. One respondent surveyed explained that by selling by owner, “I am doing most of the work as is and would not want to give that commission away. I also have more control over the process, which is a huge benefit.”

Justin Cyr successfully sold by owner in August with ForSaleByOwner.com sharing that, "I went into the process not knowing a great deal about the selling process, but with the site and all of the tips, I felt confident going forward. With the money saved by using ForSaleByOwner, I plan to increase the down payment on my new house!

To find out how you can sell by owner during a good housing market and save on commission fees while maximizing your exposure, visit ForSaleByOwner.com.

Wednesday, September 24, 2014

Selecting the Right Property for Investment

Joel Cone is a freelance writer based in south Orange County, California. For nearly a quarter century Joel's career — both as a journalist and as a marketing communications specialist — has focused on the residential and commercial real estate industries, as well as the legal community. After a decade as a staff writer for the Daily Journal Corp. group of newspapers, Joel was a regular contributor to California Real Estate magazine for the California Association of Realtors; was the original Orange County reporter for GlobeSt.com; wrote executive profiles for OC Metro magazine; and has been published in a number of real estate-related publications.

The choice of real estate-related shows on television can give anyone the idea that investing in real estate is a worthwhile endeavor. It can be, but for any investor – seasoned or novice – there are some fundamental principles to keep in mind when it comes to selecting properties.

Regardless of the present state of the economy or the real estate market, any legitimate investor will not start looking at properties without first determining the ultimate goal desired. That goal depends entirely on the investor’s exit strategy.

Here are the two basic exit strategies most real estate investors adhere to:
  1. Buy and hold. The investor wants to collect a portfolio of rental properties to generate a steady income stream over a period of time, thereby becoming a landlord.
  2. Buy, fix and sell. Better known as “flipping,” in this scenario the investor wants to purchase desirable properties at as low a discount as possible so as to have a good payday at the end when each property is finally sold.
Once an exit strategy is selected, then locating and securing properties that fit the investor’s exit strategy is much more cut and dry.

Investors Learn to Adopt Strategy to the Market

Buy and Hold
Once the question of exit strategy is settled, where and how to buy good properties that fit those strategies is as individual as the investor.

While some investors do not mind buying in different markets around the country, others like investor, author and trainer Tony Alvarez prefer to stay in their own backyard like he has in the Antelope Valley area of Los Angeles for many years.

A former appraiser, Alvarez is a true student of his market, keen on knowing the local economy and housing statistics. In such a volatile market as his, Alvarez said that a long-term hold of an asset is not forever, but only until the market peaks before he sells.

“An investor is somebody buying one unit or a whole complex. They are usually making their decisions based on return of investment and calculating capitalization rates and stuff like that,” Alvarez said. “When I look at purchasing assets, I want to have more than one exit strategy when I make my offer. One eye is on cost of construction and the other eye is on the ability of that asset to generate cash flow. I use a gross rent multiplier.”

When it comes to buying and holding properties in Denver, Colo., attorney and investor Bill Bronchick also looks at the financials except his strategy calls for buying properties that can demand a rent that allows for a 25 percent cushion above total costs (principal, interest, taxes and insurance). After that, he looks for properties that allow him to get in and out with a minimum of repairs before renting it out. And his last requirement is that the property must cash flow.

“You want to be in an area that in terms of long-term growth is going to keep its value,” Bronchick said. “It’s a balance between cash flow and future potential. You want something that’s right in the middle of the pack. Stick with lower middle class properties that are just at or just below the median price for the city.”

Andy Heller, a longtime investor in the Atlanta market, coaches and trains wannabe investors. Unlike Alvarez and Bronchick, however, Heller does the buy and hold strategy with a tweak…

Instead of buying and holding a property over a long period of time, Heller prefers to offer up his properties to his tenants as a 3-year lease option. Doing so allows him to enjoy the tax benefits of being a landlord, while also giving the tenant a sufficient amount of time to either exercise the option to buy the property outright or to either extend the option or to simply move out.

To Heller, the most important factor is finding a property with a sufficient investor discount.

“My model is to lease purchase a property. I do not use a Realtor. I need a 10 percent discount if everything is perfect. I don’t need a 25 percent discount so I know there’s more properties out there for me,” Heller said.

Next, he looks for properties that satisfy his exit strategy – those that will make a good lease purchase to a quality tenant base. With Heller’s model, that’s middle-income properties. Therefore, the investor must know with certainty what the middle-income range is for the market they are working.

Lastly, after locating a property with adequate investor discount, in a middle income neighborhood, the final factor Heller focuses on is the area’s schools. The schools must be good in order to attract the high quality tenant/would-be buyer who would pay a premium to live in the area where his properties are located.

Flipping Out
Being both a real estate broker and a general contractor, Scott Mednick knows what he is looking for when it comes to locating properties with potential to flip. Working throughout the Southern California region, he has established a methodical approach to selecting potential investment properties.

“I’m a negative Nellie. I look for everything wrong with the location first,” Mednick said. “Then I look at what’s right with the house. I try to buy the biggest, ugliest house in the neighborhood.”

For Mednick, the determining factor is strictly price. Before he even inspects the property he has gone on the MLS and done his homework so that he is at least 90 percent sure about the property ahead of time.

“I figure what the maximum sales price could be for that area. I’m going to do the nicest house in the area and get close to that price, backing off the rehab costs, the carrying costs, and what I’m buying it for. If there’s a 10 percent profit at the end, then it’s a go,” he said.

It’s how you play the game

Being a real estate investor is much like playing a game of chess. It all comes down to strategy. Every move an investor makes has to be with forethought and the end result in mind - the exit strategy.

After that, determining where and how to buy properties is an individual decision. For some investors check out the local multiple listing service and build relationships with local Realtors to get the scoop on new properties before they hit the market.

For others, it’s buying properties at auction, utilizing websites such as Auction.com as a prime source of information to find out when and where the auctions are being held and how much the opening bid will be.

But no matter the eventual purchase method, the most successful investors are the best students of their market when it comes to determining a property’s investment potential.

This is an exclusive article from Auction.com, LLC, the nation's leading online real estate marketplace. Founded in 2008, the company has sold nearly $20 billion in assets since 2010. Auction.com has more than 900 employees and offices in Irvine and Silicon Valley, California as well as offices in Atlanta, Austin, Denver, Miami and Newport Beach. Visit us at www.auction.com, or on Twitter, Facebook and LinkedIn.

Tuesday, September 23, 2014

Home Seller Sweepstakes Winner Profile: Naomi Boyd

This summer, ForSaleByOwner.com held its inaugural Home Seller Sweepstakes, a promotion celebrating successful by-owner home sellers. Three lucky winners were each awarded 6 percent of their home sale price the equivalent of what they saved by not having to pay a real estate agent's commission. Here we profile our June Home Seller Sweepstakes winner, Naomi Boyd of Morgantown, West Virginia who won $24,000.

For her very first home sale, Naomi Boyd decided to go the DIY route. "We previously tried listing with a real estate agent without success," she reports of the 4-bedroom home she and her husband Jonathan sold in Morgantown, West Virginia (pictured above). With three small children (ages 2, 6 and 8), Naomi and Jonathan appreciated the flexibility selling by owner offered their family. "We were able to schedule showings more efficiently and at times that worked for us," Boyd says.

The Boyds, who are both employed at West Virginia University in Morgantown, mention that ForSaleByOwner.com is a popular real estate resource where they live. "In our area, the first place people look to buy or sell a home is ForSaleByOwner.com, even before they look at potentially selling with a real estate agent," Boyd reports. "Being nationally known, we knew it would give us more visibility to people who might be moving from somewhere else." For that reason, the Boyds were certain their home would receive the attention they felt it deserved.

Selling to a buyer who was working with an agent added up to a streamlined sale for the Boyds. "It was nice being able to answer questions directly. It felt like we were having a natural conversation," says Boyd. She points out that if a home owner stays motivated and organized, it really isn't that different than working with a seller's agent. "The only difference is that you get to stay at your house during showings rather than having to drive around in your car for an hour!"

Boyd also touts the Multiple Listing Service (MLS) package offered by ForSaleByOwner.com as an effective marketing tool. "The MLS gave us more exposure, which is exactly what we needed," she says. "I don't see how you can go wrong with the MLS package considering you get the exact same exposure as if you used an agent."

Upon learning they had won the Home Seller Sweepstakes, Boyd reports she was "in shock." Once recovered, she put plans for the winnings in motion. The Boyds plan on finishing a room in their new home as either a "movie theater room or sports court for the kids."

Friday, September 19, 2014

6 DIY Home Staging Projects for Any Budget

Looking to stage your home for sale on your own and on a budget? These six home staging tricks are simple and cost-effective solutions that any home seller can tackle in a weekend.

Preparing your home for sale can be a lengthy process that might require home improvement projects as well as days of decluttering and cleaning your home for staging. While those undertakings can be expensive and time-intensive, these simple tips take almost no time at all and many of them can even be done for free.

1. Simple Storage
Buyers are always interested in having more space, so having some simple storage solutions in place can go a long way toward helping you sell your home.

Quickly clean up any junk drawers by using jewelry boxes to divide storage and make these areas more presentable. For those hard-to-organize items like art supplies or Tupperware you can use racks intended for dish drying or media storage. A CD rack can be a great way to store all those plastic lids and bowls that are cluttering up your cabinetry.

If you haven't already, make sure that you have figured out how you will store excess furniture to create the extra space that buyers love.

2. Dress Up the Dining Room
Adding some of your serveware and a simple centerpiece can not only make your dining room more inviting, it can also free up some additional storage space in your cabinets. The key is to avoid overstaging with ornate silverware, which can give the room a lavish feeling that may alienate buyers.

3. Beautify Your Bedroom
While buyers may look for simplicity in the dining room, they will expect an air of luxury in the bedroom. The simple addition of a new headboard to your bed will provide the sense of elegance a buyer expects.

If you don’t have the time or budget to pick out and install matching sconces an inexpensive set of desk lamps and some adhesive tacks or hooks can do the trick. By using adhesive strips you eliminate having to patch or paint the walls after the buyer makes their lighting decisions for the room.

4. Camouflage the Cord Chaos
From the chargers for your mobile devices to the television, computer or router, you may be dealing with an unsightly tangle of power strips and cords.

Velcro tape is a great way to tie up long cables and double-sided tape is an easy way to mount power strips to areas that are out of the field of vision.

5. Preview Your Paint
If you have decided to paint your interior to provide a more neutral color palate you can save yourself time, money and stress by previewing your paint choices using Colortopia. This free tool allows you to upload a photo of any room in your home and preview your color choices before you paint.

6. Fabric Fixes
Repurposing a duvet cover is a handy and affordable way to make custom curtains with relative ease. By cutting the duvet in half and adding a few pin-on drapery hooks, you can add some window dressing that enhances any room.

If you need a quick way to dress up some unsightly window rollers or rubber mats you can attach some interesting fabric using double-stick tape or hot glue.

What are some quick and easy DIY staging tricks that you have used? Let us know in the comments.