FSBO Jane

 Not everyone has children. That is a fact. However, it is also a fact that purchasing a home in a good school district almost always adds equity to your home.

Here’s my Experience:

Didn’t Think It Mattered

A while ago, when I was transferred to a new state, one of the first things I did was look for a home that was convenient to work. One home I looked at was down the street from a school. Since I had no children, the idea of living across from a school did not appeal to me in the least.  Even though the school was in an award-winning school district, I thought it would only be desirable for families.  I ended up purchasing a home a few miles away, in a different school district, and for less money.  I thought I had made a great deal.

Found Out It Does

Two years later I moved back to the Chicago area and placed that other home on the market. It took me quite a few months to sell my home, even though I thought I had listed it at a reasonable price. I found that that particular home did not appreciate in value very much. It might have been the schools.

Turns out, a house in the neighborhood with the “good schools” appreciated several thousand dollars higher and sold much faster than my home, although they were similar in many ways.

Now I know that every home is different, hence the different prices, but I also have noticed a trend at work: homes near the quality schools sell much faster than homes in less popular school districts.

Face it: in some neighborhoods it is families or young couples planning to have children who are most likely to move in, usually because of the school district. Certain areas in the Chicago suburbs, like Naperville, Glen Ellyn and Hinsdale are much more popular because of the school districts.

What You Should Do

So before you pass up purchasing a house because it is too close to a school, ask yourself a few questions:

First- Do you plan on having children that could attend the school? That could make a big difference to your appreciation for the school long-term.

Second- Do you think you may be reselling the home in the near future? If so, it might be easier to sell a home near a good school.

Third- If you really like the house, how will living near the school affect your lifestyle, if at all?

Living near a school may not look very appealing today, but give it a little thought. It could turn out that purchasing a home near an award-winning school turns out to be one of the best long-term decisions you make.

From a recent WSJ.com article, on how to invest in these turbulent times:

“10. Finally, if you’re simply too afraid of taking any risks at all — try thinking about what inflation is going to do to you if you sit in cash on the sidelines. There are, literally, no risk-free places to hold money.”

Read the other nine suggestions here.

If you’re wondering whether it’s the right time to build your dream home, check out this article from Money Magazine’s Carla Fried, who argues that you can save thousands of dollars by building your dream home now while the market is still suffering. I think it might just be time to build that mansion with a screening room I’ve always wanted!

When done well, home remodeling can turn a rustic antique into a stunning showcase.  However, appearances can be deceiving when you are looking into older homes, and some newer ones as well. Big developers, rapidly built developments and lazy construction can cause some of the same problems that many older homes have, such as cracking, leaking, bulging and weak structural integrity.  Pretty homes are great on the market, but hidden hazards could leave you, the homebuyer, with major repair costs. 

Liz Weston of msnmoney.com has compiled several ways to check for the safety and integrity of an older home:

Sloping and Cracking

Slight sloping and cracking is normal with older homes, but big cracks are a big no-no and can be signs of a weak or adjusting foundation. Weston notes that, “sloping that’s accompanied by significant, recent wall and ceiling cracking should be a concern. If the new ceramic tiles in the bathroom are already cracking, for example, you have good evidence of serious trouble.”  New homes can face similar issues if poorly constructed; sloping, bulges, or cracks are an enormous red flag in recently built homes.

Settling and Sticking

If doors and windows are hard to get open, or you see open cracks when the window is fully closed, this could be a result of “settling, foundation problems or poor construction,” according to Weston.  Expanding wood could be signs of fluctuating humidity, water absorption, or age, leading to troublesome repairs.  Wide-open cracks are a major cause of energy inefficiency, and may signal a need for new windows and doors that have been properly fitted and installed.

Knock-Downs and Add-ons

If you know that a homeowner has either added on or knocked down walls to create space, it is possible that a poorly executed job could cause future trouble in the home.  Such remodels “can undermine the stability of an entire house if the remodeler unwittingly removes a structural or load-bearing wall. Sagging rooflines, ceilings or beams should be big red flags,” says Weston.  If you are unsure whether a major remodel will affect the structure of a home, it is best to contact a local inspector, or to look into the history of contracted work that has been done on the home. 

See this article for a more detailed look at rehabs.

Just in case you’re looking for my weekly postings at Bigger Pockets, I thought I should make an announcement that my time there has ended.

I enjoyed the opportunity to be a part of one of the biggest and best real estate websites, and Josh Dorkin was a lot of help. But I did a lot of thinking recently and decided it was time to move on. For one thing, a large number of the people frequenting the site are real estate agents and Realtors, who, understandably, are hostile to my FSBO message. I started to feel like I was opening up a fight with each post.

Anyway, I’m still a fan of BP and all it provides, so if you haven’t seen it, do take a look: here.

Here’s a round-up of some of my recent posts at BP:

International Real Estate and FSBOs

Why You Don’t Need a Realtor (this one really stirred them up)

Bigger Loans, Bigger Buyers!

What Do Home Buyers Want?

Short-Term Fix, Long-Term Worry

Here’s How You Write a Real Estate Ad

What Makes a Kitchen Gourmet?

Do You Recognize the Early Signs of Seller Success?

OK, in some parts of the country you might not believe it, but I promise: spring is just around the corner. 

In the Midwest, we have had a horrible winter with too much snow, frigid temperatures and dark, gloomy days. But spring is coming and what better way to welcome it than to brighten up our yards?

On that first warm day when the temperature creeps to the 50-degree mark or above, everyone wants to get outside and enjoy the weather, since it may not last. Grab the light jackets, the kids and some gardening gloves and head out into the yard.

CLEAN UP

While the kids kick the soccer ball around the yard or scooter on the driveway, take a garbage bag and start picking up all the garbage that has accumulated on the lawn, in the bushes and under your plants all those months beneath the snow. Make sure to wear gloves and boots because some of the papers can be wet and the ground will most likely be muddy.

EVALUATE

Once that task is accomplished, take a good long look at your yard from the front street.  Odds are it probably doesn’t look very impressive, but with a little effort you can create a beautiful front yard perfect for enticing new buyers.

HANG A FLAG

Since the plants probably don’t have any color yet, it is up to you to create color that will draw interest to the home. The easiest way is to hang Old Glory from the front porch or garage. There are no prettier colors to an American then the old red, white and blue.

ADD LIGHTS

If you have a walkway, think of ways to spruce it up a bit.  Adding flowers is not an option since the threat of a possible frost still lingers in the air, but think about purchasing some solar lights to illuminate your walkway.  Available in a large variety of shapes, designs and price, the walkway lights will definitely add flair and glamour to your drab spring landscape.

PUT OUT FRESH FLOWERS

The weather might be warm where you live already, so if there isn’t too much threat of another frost, you may consider investing a few dollars in planting some beautifully colored flowers in decorative flower pots.  Mix up the colors of the flowers, creating a vibrant splash of hues and throw in one or two hanging green plants for dramatic effect.  Place them on a front porch step or near the front door or garage where they can easily be seen. Don’t make the pots too large. That way, if the temperatures do dip, you can easily pick them up and carry them inside until the weather warms again. 

ALTERNATIVE: USE ARTIFICIAL PLANTS

Is the temperature still being temperamental? Consider decorating the pots with silk flowers. Available at craft stores, silk plants can be beautiful, colorful and inexpensive, but still creates the same vivid result.

PULL OUT FURNITURE

Since spring is almost in the air, why not pull out the outdoor furniture now to liven up the front porch. A single rocking chair or two Adirondack chairs with a small table between them, painted in vibrant colors, can turn a boring front porch into an inviting one.

The point is, as soon as the weather warms if only for a day, head outside and do what you can to turn that drab front yard into a thing of beauty!

In 2007, almost 300,000 neighborhoods in the U.S. were governed by a community association. Also referred to as homeowners’ associations (HOA), these groups preside over a community of condo/townhome owners and handle several matters, such as lawn care, maintenance of common areas and conducting neighborhood. They also have the authority to administer restrictions.

An article on Yahoo Real Estate cited a story about an association member that chastised a condo owner for “non neutral draperies” hanging from his balcony. This piece of cloth was an American flag displayed by a patriotic homeowner on a national holiday. The Foundation for Community Association Research recently discovered that those who belong to an HOA appreciate and approve of their restrictions. Some people think that some of these are valid, while others feel that some of them are way too extreme.

Here’s a list of potential HOA restrictions:

• parking on street
• landscaping approval (perhaps types/number of plants)
• garage door being open
• fence and pool restrictions
• erection of basketball hoops or tree houses
• storage of boats and RVs
• number of pets
• age requirements of residents (55+ communities)

But what about the benefits? HOAs can put restrictions on homeowners, but they also offer a lot of perks, sometimes for a very low fee.

Here’s a list of potential HOA benefits:

• common areas
• community pool
• tennis courts, basketball courts, baseball/softball fields
• golf courses
• fitness centers
• cable television
• lawn maintenance
• trash pickup

Whether you love the idea of a governing association, you despise it or you meet somewhere in the middle, if you are thinking of purchasing a townhome or a condo, this is something worth considering. It’s important to look at the home/condo to see what it has to offer in terms of space and location, but you should also consider the restrictions and benefits of the HOA.

What do you think? Feel free to comment below!

With the biggest housing inventory America has seen in 13 years, homeowners, realtors, and everyone else is doing what they can to sell, sell, sell.

In this article from the Realty Times, some of the more aggressive techniques are using the strategy of a quick-and-easy home sale as an incentive for buyers. While homes are now being paired with luxury vehicles and plasma TV’s, the biggest incentive in these strategies is to find a quick bargain and to act quickly. Among a few creepy-sounding ideas from real estate companies, this article speculates that an old type of investing might become popular in the new age of real estate.

“Quincy Virgilio, president elect of the Santa Clara County association, says expect to see a return to equity sharing. The creative financing strategy includes two parties — one who occupies the home, another, an investor, who foots the bill for the down payment. Cash-short but income-rich, one person becomes a homeowner without money down, the investor can get a joint venture-like return on his or her money and a seller, in a slow market, could become the investor or otherwise use the technique to quickly seal a deal…”

In the midst of several grand ploys to sell home quickly, equity sharing is one option to get first-time homeowners into the market. This is one of many options available to new and prospective homeowners, and might serve as a better incentive than that year-long free gym membership that comes with your spacious two-bedroom ranch.

Knowing What to Do With Sellers’ Remorse

Why does it happen? Though uncommon, sellers’ remorse occurs among sellers who lack good reasons for selling. They may have wondered if they could sell or how long it would take, or they may have changed their mind about moving during the selling process. Regardless, an unmotivated or no-longer-interested seller could get all the way to closing and then decide to withdraw the property.

What should you expect as a seller? If you’re listing your home and have found a buyer but suddenly get cold feet, you probably will be able to cancel the deal. Sellers who work with agents/brokers may be liable for commission fees, but sellers going the FSBO way may not owe anything.

What should you expect as a buyer? Each situation should be evaluated specifically, but in a general sense: the seller will probably be able to take back the deal. In some cases, you may be able to pursue damages and sue the seller.