Thursday, April 06, 2006

The Best For Sale By Owner Guide to Sell for Your Price.


This guys from New York sold condo for $599,000 USD via for sale by owner route.
The story is fantastic:

Without further ado, it's time for the final report from The Fizzbows, the Brooklyn family selling their apartment at 29 Tiffany Place in the Columbia Street Waterfront neighborhood (asking $599,000) via the For Sale By Owner route. The report begins:

Thanks to everyone for being patient during our hiatus. We were amid offer negotiations and then on holiday, and then it just took us way too long to compose this (so sorry). We've written our concluding Fizzbow entry for anyone who is interested: and from the comments we read, we know there are some of you are and some of you are very not interested. If you're not interested, stop reading now.
You going to take that kind of abuse from the 'bows? Of course not. Go ahead, click on through to the other side where the full report awaits. Among the shocking revelations: spam works, baby! Plus a whole ton of FSBO advice that you might actually find useful.

The Fizzbow's Final Report:

THE STORY TO DATE...
We had our second open house on Sunday, 12/11. Healthy showing (16 people), although it wasn't as heavily trafficked as our first open house the week prior.

The following day, Maxwell from Apartmenttherapy.com, posted our site on his blog (he's experimenting with a section dedicated to FSBO people like us). Though accused of double-timing, we originally sent Lock and Maxwell our site at the same time (Lock picked it up first). [Take that, Ryan! ed]

The site was also inadvertently picked up on some other real estate/graphic design sites: with some as far away as Spain, San Francisco, and South America. This drove lots of traffic to the site but”obviously”didn't get too many qualified buyers to the open house (although selling to a Mariachi band would have been cool).

To the many brokers who called wishing to list our apartment, we politely declined but told them it was fine if they brought their clients as long as offers by them were at least 3% higher than our next best. We were surprised to find that one of these brokers listed the property on their site and added $19K to cover the commission. Some people thought we had thrown in the proverbial FSBO towel and gone the broker route. Not so.

Over the course of our selling experience, four brokers brought one buyer each. The dozens of other prospective buyers all came without brokers.

From our first two open houses, we had four primary buyers interested (and a handful of other leads who were interested but not ready to make an offer). Two of the primary buyers came from the first open house and two from the second. While we didn't hold an official open house after our second, we did show the apartment to a handful of additional prospects while we waited for the others to get pre-approved and finalize their offers. We ultimately ended up getting three offers: a good one, a pretty good one, and a mediocre one. We accepted the good one (for our asking price) and are in contract. We close in a few weeks.

THE BUYERS
So who are the buyers and how did they find us? They are a young family with similar taste and interests as us. Some brokers had warned us that buyers don't like dealing directly with sellers, but we found dealing with them to be a pleasure (and I believe they enjoyed working with us too). Ironically, they found our apartment”not through the extensive blog coverage we got but through our initial email message we sent 200 of our friends and acquaintances. This short email simply let people know we were selling and asked them to forward our site to anyone they thought might be interested. One of our friends referred the apartment to the buyer (a friend from the local gym) and the rest is history.

So besides being tutored by anonymous posters on how to best stage our apartment photos, what else did we learn from this crazy FSBO experience?

1. SELLING FIZZBOW IS A LOT OF WORK
Creating our Flash site was a substantial amount of work. It was streamlined somewhat in that we used existing code (from a previous project), but it still took around 15 hours taking the photos and putting it together. We also spent about three hours pitching media outlets to feature the site. Fielding questions from prospects and brokers was another 10 hours. And the open houses and visits consumed around 10 hours.

Was it worth it? We think it was. We assume we probably got more traffic and more interested buyers than the other properties in our neighborhood (that were listed using brokers). And despite the hours, we pocketed the 6% commission (about $36,000, which can buy a lot of GoGURTS for our little family). Dividing the commission by the roughly 38 hours of time spent, we figure we ended up making around $947 for every hour we put into it.

2. SELLING FIZZBOW DOESN'T REQUIRE MASS MEDIA EXPOSURE
While we definitely appreciate the media exposure we got—and while it did provide a lot of foot traffic to our open houses—the majority of our top prospects actually came from friends of friends and referrals from people within our building. The Apartmenttherapy plug and the recurring Curbed postings resulted in huge traffic spikes to our web site, but we also got a steady number of buyers from our NYT.com and Craigslist listings, which were more targeted. The Curbed exposure was amazing and we’re so grateful for it. But based on the response we had from our own marketing, we feel we probably could have sold without the high-profile exposure.

3. THICK SKIN REQUIRED WHEN POSTING ON A BROKER-VISITED BLOG
Many people (including brokers) were supportive and praising of our efforts to sell ourselves, but soon after our story broke on Curbed, it became apparent we had struck a nerve with a few people and—in some instances—ignited a heated debate regarding the current NYC brokerage system. While this wasn’t our aim, it also became obvious that a contingent of people (including a few brokers) were very anxious to see us fail miserably.

We expected and were fine with people acting as art directors of our site or interior designers of our apartment—and we were even fine with the open debate regarding the pros and cons of the property—but unfortunately, some people on a handful of occasions (anonymous posters and a couple of brokers who called us) crossed the line of what we deem appropriate. We accept this hostility as part of the process but feel it was unfortunate and unnecessary.

CONCLUSIONS
Despite the occasional negativity, there were definitely perks to our FSBO experience. We met some great people and learned a lot about selling real estate. And yes, we also enjoyed our small moment of NYC real estate fame. And while we definitely don’t claim to be real estate professionals, we were crowned with the title of #3 Best Curbed Celebrity for 2005, so I guess that gives us some authority to dole out some free FSBO advice.

For those of you so inclined, we absolutely think it’s worth a try to sell by owner. The worst thing that can happen is that your property won’t sell, in which case you can hire a professional broker. We don’t think you need to be a Flash geek or marketing person to successfully do it, either. We just think you need a little time, a little bit of computer experience, and a semi-attractive apartment, we think it’s pretty straightforward. Here’s our 2¢:

Step 1: Get Your Property Info Online—Prepare a simple web page that showcases your property info and photos. You can pay $125 for a page on the New York Times Real Estate website (you can have up to ten photos plus your description). If you want something a bit more substantial, you might also consider purchasing an inexpensive template at someplace like HotPlum. Once you have the template, either take some nice photos and drop in your apartment info yourself or pay someone a nominal fee to do it (i.e. a graphic-design student).

If you’re unsure of how to best describe your property, take a look at similar listings online. We also thought the written descriptions on this FSBO site are particularly well done.

Good photography is key. If you’re not comfortable taking the photos yourself, hire a professional—or at least an amateur. And whatever you do, don’t include a cat in any of the photos.

To determine your asking price, ask around the building to know what has sold recently and for how much and do a search at the NYT.com to see how similar apartments are priced.

Step 2: Get the Word Out to Your Personal Network—Send your online listing to all of the New Yorkers you know. Surprisingly, this was our most efficient method of acquiring qualified buyers.

Step 3: Post in Your Building—We also recommend posting a couple of flyers in your building (we received several referrals from this). One of our friends recently went through the entire broker process only to have his downstairs neighbor buy the apartment (so they could add a second floor). Had my friend posted a flyer in his lobby prior to listing with a broker, he might easily have saved paying the 6% commission.

Step 4: Post Your Listing to FSBO Friendly Databases—We recommend posting your property on the NYT Real Estate site. At this point, we think it’s the best place for buyers to search because it’s the closest thing NYC has to a comprehensive MLS. We’d also recommend taking advantage of FSBO friendly blogs like Apartment Therapy which provides an edited list of FSBO properties for its readers. Craigslist is easy (and cheap), but it’s also cluttered and is difficult to search. That said, list there anyway. And while the NYT web listing worked well for us, the NYT classified ad (in the printed paper) was not a big performer (we only received broker calls from this.)

Also, check out the new Google Real Estate service once it launches. It’s unclear when it will be live or how much it’ll cost FSBO sellers to use, but it utilizes the Google Maps functionality and integrates property info from several databases (including NYT.com). It also lists recent sale prices, which is a boon for buyers and sellers. We predict it’ll quickly become a primary resource for NYC buyers and sellers.

Step 5: Kick Back and Wait for the Offers to Roll In—Okay, it’s not that simple. There are lots of little things that go into it, but in our mind, they’re all common sense. Take what you liked about your buying experience and replicate it. Take what you didn’t like about your buying experience and figure out a better way to do it.

Request that your buyers be pre-approved prior to making an offer. If you’re uncomfortable with negotiating offers, hire a real estate lawyer who will help. And if you feel like you need more advice, post your question here on Curbed and you’re sure to get a wide range of opinions.

Step 6: Rejoice / Call a Broker—If you find that perfect buyer on your own, take the 6% commission, convert it into one-dollar bills, lay them in your bed, and then roll around in it—naked.

If you don't sell in the first two weeks, fret not. According to third-quarter data from Miller Samuel, the average 'days on market' is currently around 133 days. However, if you've had the property listed for several weeks and you're still not getting a substantial amount of interest, perhaps it's time to research and hire a talented broker who can help you make the sale.

We enjoyed our FSBO ride, for sure. We hope our experience has been helpful”or at least entertaining”for some of you. Thanks to everyone who supported, defended, and cheered us on” it meant a lot to us! And to those of you who were antagonistic, hostile, and rude; we wish you the best, too.

We're hoping a #3 Curbed Celebrity for 2005 tapestry is on its way to us right now. Not that we'd hang it up in our apartment”because there's no room for art in our "Skinnerian box!" But maybe it'll work in our new suburban home. The Fizzbows

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