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FOR SALE BY OWNER GUIDE |  |
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INTRODUCTION Whether to put your house up "For Sale by Owner" isn't always an easy decision. After all, real estate certainly seems like a complicated business. This guide will help you to sort out some of the confusion. We'll go step-by-step to give you the information you need not only to make a FSBO decision but also to successfully sell your home and steer the transaction through all the steps to closing. It is simpler than you think! FIRST THINGS FIRST: SETTING A PRICE The first step in the process is to determine the market value of your home. How much would a buyer be willing to pay for it? This depends on three things: • Location • The sales price of comparable homes in your neighborhood. • The condition of your home. You’ve probably heard the old adage, “location, location, location”. This holds as true today as it ever did. A buyer may pay a much different price for a house located in neighborhood A than he would for the same house located in neighborhood B. That’s why when you’re trying to determine a price for your home, it’s important to look at what comparable homes in your neighborhood have sold for. Unless you want to hire a professional appraiser, this will take a little research. Start by searching this site for homes that are comparable to yours – those with the same number of bedrooms, bathrooms and approximately the same square footage. Another good resource for comparables is your county’s assessor’s web site. The amount of information they provide varies, but you can often find out what homes in your neighborhood last sold for. Homes in your own neighborhood will give you the most accurate estimate. If you can't find any that have been sold recently, look in a neighborhood similar to yours. By "similar," we mean in desirability – how good is the school district? How close is shopping? What's the crime rate like? If you've lived in your city for awhile, you'll have a good sense of which neighborhoods are most like your own. Once you have an idea of what comparable properties (known in the real estate business as "comps") have sold for, let's consider the condition of your home. If your home is well-maintained, you're in great shape – you can use the comps to set a price for your home. If it needs a lot of repairs, you've got a "fixer" on your hands and you'll not only have to deduct accordingly from your sales price, but also expect prospective buyers to use its condition in an attempt to negotiate the price down further. If you've done some major upgrading, sit down. We hate to be the bearers of bad news, but most upgrades will not add much to your market value. There is an exceptions to this: a kitchen makeover may give you close to a dollar-for-dollar return on your investment. There's one more thing to consider when setting a price: how quickly are homes appreciating in your area? And when were the comparable properties sold? If you are in a very hot market, where homes are appreciating one or two percentage points a month, you will want to figure this into your asking price. A home that was sold six months ago may be worth considerably more now. If all of this sounds like too much math, consider hiring a professional real estate appraiser to determine a market price. They will have the most comprehensive sources for comps, and the knowledge base to know how to adjust the price to reflect your home's distinctive features. |
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All Site Content Copyright 2004 MichiganEhomes.com Terms and Conditions Privacy Policy