Blog.ByTheOwner.com

For a limited time, ByTheOwner.com has a special offer for Ontario home owners : They can get our Regular Package for only $99 and sell their properties without having to pay a commission.

It’s a $ 400 rebate from the regular price !

With the Regular Package, home owners have access to all the marketing tools, the professionnal assistance and the visibility that they need to sell their homes.

It’s an incredible opportunity for them to try our services and save a huge amount of money !

How to subscribe ?

You can subscribe online by clicking the link below and following the instructions.

Click here to complete the subscription online »»»»

You can also subscribe by calling us at 1-866-336-9637.

Hurry up ! This special offer will only be available for a limited time !

There are many factors that will results in success when selling a home privately. Professional signs are a very important factor. ByTheOwner.com has improved the look of our signs multiple times over the course of 11 years in business. We make sure our signs are clear, attractive, and functional.

“Thanks to the website and sign, we received 2 serious offers and have successfully sold our home!”

The ByTheOwner.com lawn sign is 3 feet by 2 feet and it is included with every subscription package. Our local representative places the owner’s phone number on the sign before the appointment. Our website and a large “For Sale” banner are also displayed on the sign. The phone number can be inputted into our website in order to take the buyer directly to the photos and info.

“We were very happy with the ByTheOwner experience as a whole. The ByTheOwner pictures look better than any other pictures we have ever seen! We had open houses every weekend and got quite a bit of traffic. Having a big open house sign and lots of directional signs gets way more drive by traffic…Ultimately our offer came in from someone who saw the house on the website and liked it.”

ByTheOwner.com also provides open house toppers which slide into the top of our lawn sign. On the open house topper, the owner can indicate the day and time of the open house. ByTheOwner.com’s open house directional signs, and directional signs are perfect for directing neighbourhood traffic to your house for sale. These signs can be temporarily placed on major intersections to promote your open house. All our signs are attractive and make the buyers take notice.

Not only do the ByTheOwner.com signs attract buyers, but they also make sure the buyers know that the owner is serious about selling. Some private sellers purchase their signs at a local hardware store and write home details on the signs with a black marker. When you are attracting buyers, it’s very important to have a professional image, a great home, and a fair price. If any of those factors are not appealing to buyers, it will make it difficult to sell your home.

“It was a wonderful and interesting experience. The pictures where very helpful in bringing the calls and visits. We got offers within two week of listing with this site. Half of our calls are people who saw the lawn sign.“

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Over the weekend, a photo appeared in the Toronto Star that showed a purple kitchen. The associated article called “Colin and Justin: Mauving right along” describes the renovation and shows the kitchen.

It is a very cool renovation and hopefully the owners will enjoy it. Perhaps it fits the owner’s style and it was exactly what they wanted. However, this kitchen brings to mind the “catch 22″ with renovations. Renovations do not always achieve a “return on investment”. Owners, if they are planning to sell the property in the future, must always consider a renovation that would appeal to a broad range of buyers.

As mentioned in a previous post (Renovations: “Ya, but it has a new roof” ), sometimes “extreme” renovations might not be great for resale value.

ByTheOwner.com adds more than 10,000 properties per year, and occasionally we see sellers who have renovated to their own taste and when it comes to sell, they realize the difficulty in finding a buyer with the same taste as they have.

Just a friendly reminder that if you want to “mauve” into a new home, you have to sell your old home…and a purple kitchen might not help you sell.

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1. How much will it cost?

This first step is key. Many sellers that use real estate agents, don’t work out how much it’s going to cost them. They simply agree to pay 5% commission because “It’s standard for the area”. If you are agreeing to pay 5% commission, then calculate how much that will cost you (plus GST). Remember that when you sell your home, it’s tax free money. If you are paying $15,000 to $20,000 to an agent, then also calculate how long would it take you to work to earn that (after tax). For example, if $1,000 is deposited into your bank by your employer on a weekly basis, that means, for a $20,000 commission, it would take you 20 weeks to earn that (5 months!).

Tip: If you think it’s outragous to pay an agent $20,000 to sell your home (which could be like you working full time for 5 months) then look for an alternative.

2. Is the listing contract breakable?

Before signing your rights away, make sure you understand if the listing contract is breakable or not. Most are not. This means that if you sign with an agent for 3 months, and he does nothing, then you have no way of breaking the contract. This could be very costly.

Tip: Make sure that the agent adds a clause that says that the listing contract is breakable, by you, at any time. The agent shouldn’t worry because they still will maintain rights to a buyer that saw the home while it was listed (hold over period), so there is no reason that they would object to the clause.

3. What will the agent do for their commission?

You should ask for a detailed, written, list of items that the agent will do in order to sell your home. Remember that if you are agreeing to pay 5%, which will amount to a lot of money, you should know what the agent will do to earn that money. Will your agent be present when buyers come to the home? If not, how will the buyers know about the important qualities of you home?

Tip: Try to put a value on the items that the real estate agent will do. Ask yourself is it worth it or is there an alternative?

4. When will appointments be scheduled?

Your agent will most likely provide a lock box so that a different agent can show the buyers around your home. Your agent will call you before the other agent arrives. You will want to know how much “warning” time will your agent provide. Will the appointments be anytime? Anyday? Does this mean that you have to keep your home clean 24 hours a day, 7 days a week?

Tip: When you sell privately, you control the visits and appointment. Many private sellers simply schedule visits on the weekend during set times. This allows them to live their life during the week, clean their home Sat/Sun morning and then accept buyers at a convenient time.

5. What price will be asked for the home?

If you are asking $400,000 and then sell for $390,000, then that means that you will take home $369,525 (assuming 5% commission). When you are using an agent, you really need to calculate how much you will keep from the sale of your home. You need to know your “bottom price”. Remember, if you drop your price by $10,000, then it costs you more than $10,000, but it only reduces your agent’s commission by $500. Large drops in price affect the seller a lot more than the agent. Sellers also need to understand that if they agree to sell their home with an agent for $400,000 and an agent brings a solid offer at that price, then they have done their job. The agent might have a right to the commission whether you accept that offer or not (check the fine print of the listing contract).

Tip: When you sell privately there is no commission to pay and you are in complete control. If you don’t want to accept an offer, you are under no obligation to do so. You also have more flexibility on price. If you wanted to sell your home for $400,000 with an agent, you would only take home less than $380,000. If you sold privately, you could sell for $400,000 and keep $400,000. You could even sell for $390,000 and you would still save $10,000.

Most parents agree that there is nothing that they would not sacrifice for the benefit of their children. For some families, the school is the main factor in determining where they choose to live. That includes specifically moving into a neighbourhood because it has a great school. They will first decide which school their children will attend, and then only search for a property in a location which permits their children to attend that school. Thus, any real estate surrounding a great school will always be in high demand. It is no coincidence that the top schools in the country are often surrounded by the most expensive real estate.

The Fraser Institute publishes rankings of the elementary and secondary schools in BC, Alberta, and Ontario. You can see all their reports here. Here is a sample from the Ontario Elementary Report.

Here are some links to the reports:

Ontario Elementary
Ontario Secondary
Alberta Elementary
Alberta Secondary
BC Elementary
BC Secondary

There has been some criticism of these reports and rankings. Most people will agree that there are many factors that contribute to the success of a child’s education. Many brilliant minds and outstanding individuals have graduated from schools that were not considered “good” and vice-versa. However, the environment does have an affect on an education, so attending a good school increases the odds of obtaining a good education.

Private sellers are the best person to explain to buyers about the quality of schools in the area because they live in the area, and their children will have attended the school.

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Here is the 7 step process to save $29,400 in 13 days.

1. Subscribe online at ByTheOwner.com and choose the premium plus package.

2. Have our ByTheOwner.com representative take amazing HDR photos.

3. Have Randall Weese, licensed real estate professional, provide you with a Comparative Market Analysis.

4. Receive offers and call the ByTheOwner.com sales coach with any questions.

5. Ignore the real estate agents that call to solicit your listing.

6. Accept a great offer and pay no commissions!

7. Save $29,400 in real estate commission and taxes.

Isn’t it great when everything works the way it’s supposed to? That was the case with this ByTheOwner.com customer and the customer now has almost 30 thousand dollars in his pocket.

There are a few ways that the above situation might not have happened.

- The customer could have listen to the agents that called, listed, and paid $30,000 in commissions.
- The customer could have posted on a lesser website, with poor photos no buyers.
- The customer could have not chosen a package with CMA and listed their property too high or too low.
- The customer could have not taken advantage of our sales coach and perhaps not have received answers to their questions.

..but that didn’t happen and the customer saved enough for a new car!

ByTheOwner.com provides all the tools and support for you to succeed in selling your home and saving thousands of dollars in real estate commissions. The real estate market is very hot right now. There is a very high demand and a low inventory of quality homes for sale. If you have a great home, now is the perfect time to sell privately.

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In order for a buyer to purchase a house, they first need to qualify for a mortgage. Also, in order for a seller to sell a house, they need a qualified buyer.

This blog post will examine what buyers will need so that they qualify to obtain a mortgage.

Down Payment

Buyers must have at least 5% of the purchase price of the home for the down payment. That means that for a $300,000 home, the buyer must have at least $15,000 in their bank account. For a $400,000 home, the buyers must have $20,000 in their bank account. This amount should be actual money. It can’t be from a line of credit, or from other sources which would require the money to be paid back.

Seller Tip: If you have a serious buyer for your home, you could ask them if they are putting 5% or 10% down. This will help you determine how much money they have in the bank.

Regular Income (Job)

In order to be qualified for a mortgage, buyers have to have regular income from their job. The banks will ask for proof (T4, pay statements) before they approve your mortgage. Their annual income will be a main factor in how much money buyers can borrow. A good rule of thumb is 3 times your income, but at today’s rates, a better rule of thumb is 4-5 times income. This means if the buyers’ combined family income is $100,000, they should be able to obtain a mortgage for $400,000.

Seller Tip: Ask the buyers what they do for a living. If they say “Teacher” and “Police Officer”, then you know that they should have no trouble obtaining a large mortgage and there is a great chance that any offer you accept will not have financing problems. However if they say “Fast Food Customer Service” and “Nortel”, then there is a possibility that the buyers might not be approved for the financing. Self employed individuals also have different requirements to qualify for a mortgage.

Credit Score

The buyer’s credit score will have a significant impact on their ability to obtain a mortgage. Buyers should already be aware of their credit score before they put in an offer on a home.

Seller Tip: Ask the buyers if they have obtained a credit check yet. If they have not, you should suggest that they call equifax or transunion. Suggest that they will need it anyways and if they let the banks check their credit, then it hurts their credit score (so they should get it themselves).

Low Debts

How much money the buyers can borrow is a function of how much money they make, but also how much debt they have. Banks will look at two numbers:

Gross Debt Serviced: This number examines how much money the buyers make and compares it to the monthly costs of the mortgage and the home (taxes, heating). The monthly housing costs can’t be more than 32% of your income.

Example:

Income: $100,000
GDS (32%) = $32,000 ($2,666 per month)
Using this measure, the mortgage, taxes and heating should not be more than $2,666 per month.

Total Debt Serviced: This number is similar to the GDS above, but it includes other debts (car payments, credit cards, line of credit…). If the buyer has lots of debts, then it will reduce the amount of mortgage that they will be approved for. The Total Debt Serviced (TDS) should not be more than 40% of your income.

Example:

If you have the following monthly debt payments:

Car = $800
Line of credit = $300
Credit cards = $150
Student Loan = $150

This would equal $1400 in monthly debt obligations. If you made $100,000 a year ($8,333 a month). That means your mortgage and housing costs could not be more than $1,933 a month ($8,333 x 40% - $1,400 = $1,933).

Summary: It becomes difficult (and a waste of time) for both buyers and sellers if buyers are not qualified to purchase a home. The best solution for a seller is to ask a lot of questions, and the best solution for a buyer is to do some research so that they know what they can (and can’t) afford.

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Taking out a mortgage is a big step. An average mortgage for a buyer is approximately $300,000. When you agree to take on that mortgage, you are agreeing to pay that money back to the bank for the next 25-35 years (plus interest) regardless if you are hurt, or deceased.

What happens if you pass away? Your estate, or family, is still required to make those mortgage payments. One solution for your family, if you pass away, might be to sell the home and pay off the mortgage, however, this solution might not be ideal. This is why people have mortgage insurance or life insurance. Your insurance will cover the costs of the mortgage if anything happens. If you are looking to protect your family if anything happens to you, there are two different types of insurance that you can have: Term Life Insurance and Mortgage Life Insurance. Let’s examine the difference:

Mortgage Life Insurance:

If you have Mortgage Life Insurance and you pass away, then the bank will pay off your entire mortgage. You will not receive any money, you will simply no longer have a mortgage. Mortgage life insurance is usually offered to you by your bank when you take out your mortgage. Many people choose this option because it is very convenient to have your Mortgage Life Insurance through the same bank that holds your mortgage. The payments are taken out at the same time and they show up on your mortgage statement. However, your might be paying EXTRA for that convenience.

Some of the disadvantages of using Mortgage Life Insurance is that the coverage will only insure the cost of your mortgage. So if the main income earner passes away, Mortgage Life Insurance will pay off the mortgage, but it will not cover other debts or obligations such as credit card debt or car payments.

Term Life Insurance

Term Life Insurance will cover a person for a certain amount of money if they pass away. You will receive a large sum of money and the insurance money can be used by the beneficiary however they choose. This type of insurance might be better than Mortgage Life Insurance for several reasons:

1. You can use the payout as you please. If you have a $300,000 Term Life Insurance Policy, you can use that money to pay off some of the mortgage or car debt, or credit card debt. This allows the beneficary more options.

2. Term Life Insurance is sometimes less expensive. According to Kanetix, if would be less expensive to obtain a $250,000 Term Life Insurance policy compared to a $250,000 Mortgage Life Insurance Policy. The month savings could add up to more than $5,000 to $10,000 over the length of your mortgage.

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For the 1st time in our history, ByTheOwner.com has passed 7,000 homes sold in one year. We achieved this new milestone last week, proving that ByTheOwner.com is the most successful Private Sale company in Canada. 2009 has been an exceptional year for our customers and we look forward to passing more than 10,000 homes sold in 2010.

Our Customers Deserve The Credit

ByTheOwner.com provides the same high level of service for all our customers. We take the best real estate photos available in order to make sure our customer’s homes look their best. The ByTheOwner.com network is the most visited in Canada so our customers receive the maximum exposure. However, it is through the effort of our customers that we are able to help more and more people sell privately and save money.

Our customers are motivated to save money. They know that they will save up to 5% of their home’s value by selling with ByTheOwner.com. This equals more than $15,000 on a $300,000 home. Our customers are doing the research, having open houses, contacting their lawyer, and withstanding all the real estate agents who contact them to list their home. This effort is resulting in great savings for our customers, and fantastic testimonials for ByTheOwner.com.

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The weather in Ontario has been so beautiful this November that it’s hard to even imagine that snow will come….but it will. That’s why now is a great time to put your home up for sale. The real estate market is hot and so is the weather. This week’s forecast in Southern Ontario will range from 9 degrees to 1 degree. The sun will be shining and your grass will still be green. A perfect time for photos.

Here is an front photo from a home taken over the weekend:

Here is a photo of another home taken last winter:

In Toronto, here is the monthly snowfall from November 2008 to January 2009.

Nov: 13.1 cm
Dec: 64.8 cm
Jan: 45.2 cm

December’s total is more than 2 feet of snow!

To help our customers fully prepare for the winter, ByTheOwner.com is now offering 8 photos and 8 months on our website for all new listings. The offer is available until Jan 1st. So if you act now, you will receive even more HDR photos in order to show off your home (with no snow!).

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