Section 8.3. Selling Real Estate Online

8.3. Selling Real Estate Online

It might sound crazy to buy real estate over the Internet, but more and more people are doing just that. According to a 2005 survey by the California Association of Realtors, nearly two- thirds of first-time home buyers used the Internet to find their new home. In addition, Internet home buyers had higher incomes and made the decision to purchase faster than traditional home buyers: while traditional home buyers averaged seven weeks to find the home they ultimately bought, Internet buyers took the plunge after just two weeks of looking.

If you have real estate to sell, you can reach a wide audience of eager home buyers and investors through eBay. Real estate is a fast-growing category on the site. On any given day, if you check out eBay Pulse (http://pulse.ebay.com), which tracks the 10 most-watched auctions on the site, you're likely to find that a couple of those top auctions are for real estate.

All kinds of real estate sell on eBay, from time-shares to single-family homes to investment properties. People have used eBay to sell castles , former schools , converted churches , vacation homes, motels, apartment complexes, RV parks, factories, hunting camps, B&Bsjust about any kind of property you can imagine.

Note: In late 2004, eBay bought Rent.com. Rent.com's Web site (www.rent.com) matches up landlords and tenants. People looking for an apartment can use the site for free. (In fact, Rent.com has offered a promotion giving tenants a $100 gift card when they sign a lease through the site.) It costs nothing for landlords or property managers to list on Rent.com; when a property owner or manager signs a lease with someone who found an apartment through the site, the owner/manager pays Rent.com a "success" fee, usually $375. If you've got an apartment to rent and you want prospective tenants around the world to know, go to Rent.com and register. (Registration on Rent.com is separate from eBay registration.) Click "List a Property on Rent.com," then fill out the form.

8.3.1. Two Ways to Sell

eBay offers real estate sellers two options: you can sell your property in an auction format, or you can advertise a fixed-price deal on eBay.

8.3.1.1 Auction it off

You can run a real estate sale like any other auction on eBay: set a starting price (and perhaps a reserve price), determine how long the auction will run (from one to 30 days), and sell to the highest bidder. (For the skinny on regular auctions, check out Chapter 5.) The fees are different, as the following list shows, but the auction format is the same as a regular eBay auction:

  • Insertion fee for land, a time-share, or a manufactured home:

    1-, 3-, 5-, 7-, or 10-day auction listing: $35.

    30-day auction listing: $50.

  • Insertion fee for residential, commercial, or other real estate:

    1-, 3-, 5-, 7-, or 10-day auction listing: $100.

    30-day auction listing: $150.

  • Final value fee (FVF) for land, a time-share, or a manufactured home: $35.

  • Final value fee (FVF) for residential, commercial, or other real estate: None.

eBay states that this kind of auction is binding, but that's not really true. A high bid in an eBay real estate auction is not a legally binding commitment to purchase the property. Because of the bewildering variety of state laws governing real estate transactionsnot to mention everything that could go wrong in a given sale, from deed and title problems to undisclosed defects to a buyer's inability to get a mortgagea "binding" auction means only that buyer and seller both promise to follow through in good faith. This means that a so-called binding sale can easily bite the dust after the auction ends.

Tip: To protect yourself against all the pitfalls that could scuttle your real estate sale, require a nonrefundable deposit of at least $1,000, payable within the first couple of days after the auction ends. This deposit is called earnest money , and it shows the buyer's good faith in completing the sale. If the buyer backs out of the deal, you get to keep the earnest money. Be sure to list your requirement in your terms of sale.

To list a piece of property in an auction format, follow the same steps you'd take in creating any auction (Section 5.4.2). You do have to provide some information specific to a real estate sale on the Sell Your Item: Describe Your Item page, such as the property's address, as shown in Figure 8-9.

Figure 8-9. Real estate auctions require information about the property's location in step 2 of the Sell Your Item form (Describe Your Item). You can also add the details that buyers want to know, such as the size of the house, the number of bedrooms and bathrooms, and when it was built. The two checkboxes give you an opportunity to link to a map and a neighborhood profile, based on Zip code.


8.3.1.2 Advertise on eBay

The other format eBay offers isn't an auction at allit's really just an online ad. You can advertise your property on eBay for 30 or 90 days. Your ad will appear in search results lists and categories browsed by shoppers. But instead of a Place Bid button, there's a "Contact seller/agent" form. Interested buyers fill in their name , email address, other contact information, and any questions about the property, and then click Submit to send you that information in an email, so you can get back to them with more information or to set up a viewing.

Because ads have no bidders and no final bid, there are no Final Value Fees. Whatever type of property you're listing, the insertion fees are the same: $150 for a 30-day ad and $300 for a 90-day ad. This offers a cost-effective way to get your ad in front of millions of potential buyers.

To advertise your property on eBay, from the navigation bar click Sell Sell Your Item, and then select "Advertise your Real Estate," as shown in Figure 8-10.

The Sell Your Item: Select Category page asks you to select a category: commercial, land, manufactured homes, residential, time-shares for sale, or other real estate. After you've chosen a category, the Sell Your Item: Describe Your Item page asks for your listing title and description and shows the same form shown in Figure 8-9. In step 3, Sell Your Item: Enter Pictures & Item Details, you type in the property's asking price, choose the ad's duration (30 or 90 days), upload photos, and select any special features you want for the ad, such as featuring it in Gallery view (Section 1.2.3) or on eBay's home page.

Figure 8-10. To advertise your property on eBay (as opposed to selling it in an auction format), turn on the "Advertise your Real Estate" button when you choose a selling format. Ads simply allow interested buyers to contact you through eBay; no bidding takes place.


WORD TO THE WISE
What's It Worth?

Unless you're a real estate professional, it can be hard to decide on a good asking price for your property. You don't want to sell it for less that it's worth, and you don't want to price it so high that you scare off buyers. Many homeowners have overly optimistic expectations of how much they can get for their home. Take the time to find out what's reasonable before you list your property.

There are a number of ways you can get a ballpark figure. Invite a couple of realtors to take a look and suggest a price, comparing your property with recent sales in your area. You might even end up listing the property with one of these realtors; many real estate agents are open to advertising on eBay.

You could also do the research yourself. Many county assessor's offices have online databases of properties with information about assessments, prior sales, and taxes. Check the newspaper for asking prices of properties similar to yours. Go to www.realtor.com, type in your Zip code, and search their database for property that's currently on the market.

Of course, asking prices aren't selling prices. You can buy a simple report of recent comparable sales or a detailed appraisal of your property at Electronic Appraiser (www.electronicappraiser.com). For Sale by Owner offers free price reports but doesn't cover all areas. At www.forsalebyowner.com, choose Home Sale Prices to see if your neighborhood is in their database.


8.3.2. Tips for Selling Property on eBay

The average real estate listing on eBay attracts about 1,000 views. That means that a lot of people are already out there looking for properties like yours. Follow these tips to get them to look twice.

8.3.2.1 Spell it out

Real estate transactions involve a lot more complexity and fees than other kinds of eBay sales. Make sure you spell out your terms clearly. Think about these issuesand address them in your terms of sale (TOS):

  • Do you want to require a deposit? (Requiring a depositalso called earnest moneyis a really good idea.) How long after the auction ends do you want the buyer to pay it?

  • Do you want to require bidders to have a PayPal account (Section 6.6)? (PayPal is how many real estate sellers accept the deposit.)

  • Should buyers be prequalified or have the money in hand? (It can take weeks to apply for a mortgage.)

  • Can the buyer inspect the property in person during or after the auction?

  • When will the closing take place?

  • Who pays closing costs?

8.3.2.2 Include the neighborhood profile

When you list a piece of real estate, eBay gives you the option during step 2 (Describe Your Item) to automatically include a map and a neighborhood profile. The neighborhood profile gives demographics , housing facts, and a crime index for the area, as shown in Figure 8-11. If you don't include a neighborhood profile, buyers are likely to wonder what you're trying to hide. Is your asking price much higher than the local median home value? Is the property located in a high-crime or low-employment area? It's better to let buyers know the facts about the area up front.

8.3.2.3 Be careful about down-payment-only auctions

Many real estate auctions look like a great dealbut when you read the fine print, you realize that bids are not for the purchase price but for the down payment only. The seller is offering the property for a fixed price that's much higher than the bids.

There's nothing wrong with setting up your auction this way, as long as you make it clear how much the property really costs. In their excitement, many buyers don't read the whole ad. Yes, it's their responsibility to read before bidding, but if they've got an itchy bidding finger, it can become your problem as much as theirs. A buyer who doesn't understand your terms is likely to default on the sale. Even though you can file a UPI dispute and get some fees back, you've wasted your time.

To avoid this problem, put the words down payment in your auction title and feature the actual purchase price prominently in your item description.

Figure 8-11. The neighborhood profile, supplied by Sperling's Best Places, offers demographics and other statistics based on the property's Zip code. Investors and other buyers get a snapshot of the area they're considering buying into, so including a Neighborhood Profile broadens your sales reach by providing information to faroff buyers who can't visit the area in person.


8.3.2.4 Court investors

Real estate investing is hot. A 2005 Money magazine survey showed that more Americans think of real estate as a sure path to wealth than any other investment strategy. You can tap into this trend. When you list your home on eBay, don't just think of it as a place to live; think of it as a potential investment. Put a phrase like investment opportunity in your auction title. If home prices have been going up in your area, say so, and show investors how much the average price has increased in the last five years . Research the local rental market to find average rents on a property like yours, and feature this info in your description. If your area is a strong rental market, like a college town or popular vacation spot, let potential buyers know why the property will be easy to rent. You can even get the names of some local property managers to share with those who askand they will ask.

8.3.2.5 Consider owner financing

Owner financingwhere you hold the mortgage instead of a bankis popular with buyers. They save money in mortgage application and other bank fees. You get a monthly payment, and you can set a nice, high annual percentage rate. Offering owner financing can increase the number of bidders you get on your property.

Note: Owner financing isn't feasible if you're still paying a mortgage on your propertyunless you happen to have a wad of cash lying around. You have to pay off your mortgage before you can sell your house to someone else.

Be careful, though. You don't want the buyer to default on the mortgage, putting you through the legal hassles of foreclosing and leaving you with the same house on your hands that you'd tried to sell. If you're going to offer owner financing, get a good real estate lawyer to advise you and to draw up the contract. You should also check the credit history of any bidders, stating in your terms that you offer financing only to qualified bidders.

8.3.2.6 Use photos to show curb appeal

When you're selling a home, you want it to have what realtors call curb appeal ; your house looks so great on the outside that potential buyers driving by will want to see the inside. On eBay, you can give your home curb appeal by using lots of pictures, inside and out, that show off the property and give far-away buyers a feel for the neighborhood. The more pictures, the better. You can host them on a site outside of eBay to save listing fees (Section 6.2.4.2).

Before you take a single photo, mow the lawn, trim the bushes, hide the trash cans, and pick up any junk or kids ' toys lying around. Move the car out of the driveway (or else viewers tend to look at the car, not the house.) To avoid deep shadows that make the house hard to see, take the photos with the sun behind you. Inside, clear away clutter, and don't try to take photos of whole rooms; focus on features instead. Is there a fireplace, an attractive staircase , a gorgeous view out of the family room picture window? Photograph these things and feature them in your listing.

8.3.2.7 Market (or rent) your time-share

Time-shares are a tough sell online. When you bought your time-share, some salesperson probably fed you, entertained you, promised you a great prizeand subjected you to high-pressure sales tactics. You don't have that advantage on eBay.

People who are looking for a time-share are as interested in the area it's in as they are in the property itself. You're selling a relaxing or exciting vacation experience, so play up the area as a vacation spot that will appeal to buyers. Think about what made you want to vacation in the area, then use those thoughts to convince the buyer that it's a great place to spend a week. Is the time-share on the beach or tucked away in the mountains ? Is it on a quiet lake or near the entertainment district of a lively city? You also want to list the number of bedrooms, the week, the type of ownership, annual fees, and whether time-share owners can exchange or bank weeks. Don't forget to include any closing costs that the buyer must pay.

Note: If you want to rent your time-share rather than sell it, list it in eBay's Travel category under Vacation Rentals. Normal listing fees apply (as opposed to real estate listing fees), so listing in this category can be a lot cheaper than listing a time-share for sale.

eBay offers special tools for time-share sellers, including a value estimator and closing service, as well as lots of advice. (The first two cost money; the third is free.) To find them, from eBay's home page go to Sell Seller Central Category Tips Timeshare Seller Guide Timeshare Seller Information Guide.

Warning: A lot of Web sites offer to sell time-shares for you. If you're thinking of going with one of these, check out the company carefully . Don't agree to pay an up-front fee to an agent who promises to sell your time-share. It's probably a scam.


eBay[c] The Missing Manual
eBay[c] The Missing Manual
ISBN: 596006446
EAN: N/A
Year: 2006
Pages: 100

flylib.com © 2008-2017.
If you may any questions please contact us: flylib@qtcs.net