Zillow should zestimate itself

July 29th, 2014

Is your house worth 4 times the value of just two years ago? Has Zillow indicated your zestimate is 4 times what is was two years ago? Probably not. You are probably very happy if the value is back to it’s peak in 2007. Well, for some reason, investors think both Zillow.com and Trulia.com are worth 4 times as much as two years ago. In Zillows case, with sales of $300 million and zero profit, the company is now valued at $6 billion and Trulia never having a profit is valued at $2.4 billion. For Zillow to buy Trulia, it will just take paper, that is paper stock. No cash or other value. For revenues to increase they both count on real estate agents to spend more money advertising. As they both move towards agents helping with revenue and profit, they slowly move away from the ‘for sale by owners’. This should strengthen those that help FSBO’s, such as; FSBO.com.  Zillow should look at itself and come up with a true ‘Zestimate’.

Health of Real Estate market improves

July 17th, 2014

The real estate market has been improving yearly since the depths of the financial crisis six years ago. Sales and market values keep going up. Foreclosures keep going down. This weeks headline “Foreclosure activity hits lowest in eight years” with the number of new foreclosure filings dropping again. Remember just 24 months ago, most areas had foreclosed properties sitting on the market for sale, with the prices dropping, which held down your areas real estate market. Look around today, they are mostly gone or none existent. Mortgage rates are still below historical norms and banks are now getting more lenient. The only thing holding back future sales is lack of inventory. Many owners that have refinanced at very low interest rates are staying put. Why walk away from a really low mortgage payment? Many buyers still have a problem qualifying for a new mortgage because of credit score problems. Looking out the next 24 months, more of the same, except interest rates will move up.

Back to school home buyers!

July 10th, 2014

Even more stressful than the ‘annual buying supplies before school starts’ is knowing which school your children are attending. Between August 4th to September 8th, most schools will begin classes. That means 4-6 weeks prior to those dates, home buyers will be stepping up their efforts to find the right home. Right now begins that seasonal period. For sellers, be ready. Don’t lose out on a potential, motivated buyer, because once school starts (after Labor Day), the amount of buyers in the market place falls off. I know it’s summer time and you have other recreational things to do, plus the summer heat tends to zap your energy, well, fire up. Don’t miss out.  It’s easy to see the slowest five weeks of the year for buyer traffic is between Thanksgiving and January 1st. The busiest five weeks each year is the ‘Back to school home buyers’.

FSBO Back to SChool

USA vs Belgium

July 1st, 2014

In honor of the USA Soccer team’s match today versus Belgium in the World Cup we will be closing our offices early.  The FSBO.com Phone Support will be closed at 3PM.  They will open again tomorrow morning at 9AM.  Please feel free to use the Customer Service email link at the top of the website to submit any questions and we will get back to you after the game.

GO USA!!!!

FSBO USA Soccer

Vote Now for the Best FSBO BBQ Backyard!!!

July 1st, 2014

So far we have a pretty close race to see who has the best backyard for a BBQ for the upcoming Fourth of July Holiday.  Visit our Facebook Page now to place your vote by “Liking” your favorite one.

fsbobbq

The backyard with the most likes will receive a $100 Gift Card to Home Depot.  Voting will end at Noon on July 5th.

Don’t forget, these homes are all for sale.  If you see one you would like to buy simply click on the link to their listing next to the photo.  You could be having your own BBQ in one of these backyards by Labor Day!!!

#fsbobbq #fsbo4th

4th of July Photo Contest - $100 Prize

June 20th, 2014

We are excited to announce that next week we will be hosting a photo contest in honor of the upcoming Fourth of July holiday. We will be posting photos from many of our real estate listing’s on the FSBO.com Facebook Page to determine who has the best backyard for a Fourth of July BBQ.

fsbobbq

The winner of the contest will receive a $100 gift card to Home Depot!!!

To enter you must have an active listing on FSBO.com and need to email us with your ID# and photo by Monday morning at 9AM.

Once the photos go live, “Likes” for your photo will be counted as votes. The photo with the most “Likes” by July 5th will be the winner.

#fsbobbq #fsbo4th


Photo Courtesy of All Things G&D - http://www.allthingsgd.com/2013/07/our-8th-annual-4th-of-july-party/

Do’s and Don’t with contracts

June 18th, 2014

We’re seeing many properties receive offers, counter offers, contingencies, and due diligence periods. What to do and what not to do. If you are a seller, that means at one time you were a buyer that went through the entire process of making offers, counter offers, mortgage applications, inspections and closing. You do have some experience, but probably not a lot. Plus if it was several years ago, things have changed. If you are a buyer for the first time, you may feel overwhelmed by all of the paperwork required to write a purchase agreement and all of the mortgage documents needed to be signed. Sellers and buyers, the first thing to remember is that all agreements need to be in writing. Verbal offers, verbal negotiations, and verbal agreements mean nothing when it comes to a real estate transaction. You can get contracts, counter offer forms and amendment forms on the Internet, your local office supply store or your attorney/title company. Sometimes the mortgage broker can help you with this. Here is how the transaction normally goes. The buyer looks at the property, discusses a few items with the seller (possibly agreeing to the terms of sale), then the buyer get a purchase agreement and fills in the blanks. The buyer signs and then presents it to the seller. The seller at that point has three options. Either Accept, Reject or Counter Offers. A Counter Offer means the initial offer is Rejected and a new Offer is delivered from Seller to Buyer. At this point, the Buyer has three options: Accept, Reject or Counter Offer. This can go back and forth several times until all terms are agreed upon and both buyer and seller sign accepting. At this time a Binding Date/time is also filled in. The Binding Date/time is very important. This means the property is no longer available to any other buyers. It also establishes the starting time needed for any due diligence period, mortgage applications, etc which have a set time to get things done prior to closing. Here are a few items to keep in mind.

Buyer Seller FSBO

Seller, if you receive offers from two or more parties, never ever send a counter offer to both parties. The worst thing that can happen is that both buyers Accept your counter offer and you have now sold the same property to two different people. This possibly can lead to a  law suit, attorney expenses and not selling your property to anybody waiting months for a judge to decide who gets it. Instead, in writing, inform all parties that you have received multiple offers and set a deadline (normally two days), such as: Tuesday, July 25, 2014 at 5pm, for them to send you their ‘highest and best’ offer. Once the deadline passes, pick the single best offer and either Accept, Reject or Counter Offer with just one party.

Seller and Buyer: always put an exact date and time limit on all offers and counter offers.

Buyer: make sure a third party, such as an attorney, title company, etc holds your deposit. Also, make sure you have enough time for a Due Diligence period. Your home inspector and mortgage broker can help you determine this.

One last comment, if any thing seems out of the ordinary or you are not sure exactly what to do, contact a real estate attorney for help.

Retire in your 1031 exchange home

May 20th, 2014

Here is a true story that happens all of the time. My friend bought a rental house 25 years ago as an investment for $80,000. Over the years he kept it rented and any repairs needed came from the rental income. Plus, as with any real estate investment, he was able to use depreciation each year to reduce the Federal Income tax he paid. Five years ago he sold the property for $200,000 and because of depreciation, the cost basis was close to zero. So, ordinarily he would have to pay capital gains tax on the entire $200,000 (over $30,000 in tax). However, with the help and advice of his CPA, he decided to use the IRS deferred exchange (IRC section 1031), known as a ‘1031 exchange’ to defer the tax owed. This allows you to sell, then buy a ‘like-kind property’ to defer the tax. In this case, he found a property in a retirement city (which happens to be on a few of the retirement lists in my last blog). He bought the new property for $300,000 to rent out for over three years, which is required. He made $40,000 of improvements to make the property beautiful and this amount was written off as an expense of the investment (further lowering his income tax).  Now at age 67, he has moved into the property as his primary residence. No tax is due until the property is sold. He plans to live there the rest of his life. I’ve mentioned this story to a few people and their response was ‘who comes up with these complicated rules and to what advantage’. There are a lot of income tax benefits to owning real estate, this is just one of them.

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The Best Place to Retire

May 14th, 2014

It depends on which list you agree with. I continually see lists of the ‘Best Places to Retire’. There will be 10,000 people per day for the next twenty years turning 65 years old. These 75 million baby boomers will be retiring and make the choice, either move to a retirement area or stay put. For those planning to move, here are a few lists to consider: US News magazineFORBES magazineAARPCNN Huffington Post, etc. Some observations as I look at all of the lists is they seem to have different cities. Rarely do I find the same city on each list. Second, not all are in warmer climates or the lowest tax states. Also, try to move quickly past the pop up/flashy ad’s (you don’t see that on FSBO.com). One thing I highly recommend to those selling a property is to find the list that has your city and make sure each prospective buyer is aware of the list. As a seller you need to use all positive information you can find to make your home the most appealing.

Retire

Cash is making a comeback

May 8th, 2014

Just when you thought ‘institutional investors’ (people or companies that have purchased at least 10 properties in a calendar year) appear to be gradually pulling out of the housing market, new data shows that 43% of all residential sales the 1st quarter of 2014 were cash sales. Yes, well, these institutional investors have pulled back, buying 5% of all houses in the1st quarter, down each quarter for the past year. Who then is buying with cash? It’s the international buyer. From Europe to China, homes are being sold for cash. I remember a few years ago reading an article about the value of the Russian ruble (their currency) and how it was dropping dramatically. In an interview, a Russian lady said “I went out and paid cash for a Buick because I know I will still have something in 5 years from now”. If your countries economy is weak and your currency is dropping, USA properties appear to be a safe haven. Look at property values in London, Tokyo, Beijing, etc and you can easily see that USA properties look very cheap.  Major metro areas where over half of all property sales were done in cash included Miami, New York, Columbia, S.C., Memphis, Detroit, Atlanta and Las Vegas. While many experts are surprised by these numbers, we think until the economies of the world improve you will keep seeing foreign cash buying real estate. We have blogged many times in the past few years how foreign buyers of US Treasuries have helped keep interest rates low, now with more cash available they are buying real estate.