bubbleinfo.com

From Trulia:

In today’s market, most listings aren’t instantly flying off the market. While we all know price is one of the most important factors in the sale of a home, there are other factors they can improve the saleability of your listings.  Here are a few tips to get that stale listing sold (besides the most important – lower the price!):

(1) Offer incentives or alternative financing options

Incentives can make a big difference for buyers who are stretching to find the down payment to buy a home or who may be sitting on the edge of loan limits. Seller incentives such as paying for closing costs, inspections, or repairs, or providing allowances or credits for home upgrades after closing can make a big difference to home buyers short on cash.

Other alternatives could include pre paying taxes, homeowners dues and insurance. Consider offering buyer incentives to encourage on the fence buyers to take action on your listing.

(2) Make it accessible

Take a hard look at the accessibility of a home. Today’s home buyer is impatient. They want to see homes and they want to see them now. Make sure your listings are simple and easy to show. Carl Medford, an agent with Prudential California Realty in the San Francisco Bay Area believes home accessibility is the #1 reason homes don’t sell. “If we can’t get in, we can’t show the house. If we can’t show the house, we can’t sell it. We frequently end up showing less than six homes because we can’t get access to homes on the list.”

(3) Expose it- everywhere!

We are often surprised by the number of homes with property addresses undisclosed on the internet. It’s no secret homebuyers are looking on the internet for homes, make sure they can easily find it. Two popular search filters we see prospective homebuyers using on Trulia.com are filters for listings with open houses and filters for listings with price reductions.  Want more eyeballs on your listings? Make sure they are updated weekly on popular real estate search sites like Trulia and Craigslist and be sure to list your open home times to get the max exposure for your listings. 

(4) Refresh your photos

Today’s homebuyer spends a lot of time online. As your listing becomes stale, so do the property photos. Consider retaking the photos, especially if seasons have changed. If taking new photos is out of the question, you may want ot consider changing up the order your photos display online to give it a fresh appearance for web browsing buyers. Many agents start their photos with a picture of the front of the house when they would be better served displaying the huge backyard or the amazing chef’s kitchen.

(5) Put some zing in your marketing copy

In addition to stale photos, your marketing copy may be putting prospective buyers to sleep. “Check out my 3 bedroom, 2 bath home in a great location.”  Yawn. Add some zing to your headlines and descriptions to draw the attention of homebuyers. Your marketing copy needs to tell a story that appeals to the people most likely to buy your listing. Your copy can get old too. Simply freshening it up frequently is a good way to capture more attention to your listings.

A couple of thoughts, our hauler, plus the wrap-up tour of the new house in Leucadia:

What look or style will endure the longest before being declared old and dated?

Hat tip to ProfHoff for sending in this update from sfgate.com:

From the wsj.com:

Jason Gonsalves worked hard to turn his 6,500-square-foot stucco-and-stone home in the suburbs of Sacramento into the ultimate grown-up party pad, complete with game room, custom wine cellar and an infinity-edge pool overlooking Folsom Lake. When interest rates fell recently, Mr. Gonsalves, who runs a lobbying firm, looked into refinancing his $750,000 mortgage. That’s when he got startling news—the home had dropped more than $200,000 in value while he was renovating.

Or at least, that’s what one real-estate website told him. Another valued the house at only $640,500. And these online estimates left him all the more confused when a real-life appraiser, assessing the house for the refinancing loan, pinned its value at $1.5 million. “I have no idea how those numbers could be so different,” Mr. Gonsalves says.

Right or wrong, they’re the numbers millions of consumers are clamoring for. After years of real-estate pros holding all the informational cards in the home-sale game, Web-driven companies like Zillow, Homes.com and Realtor.com are reshuffling the deck, giving home shoppers and owners estimates of what almost any home is worth. People have flocked to the data in startling numbers: Together, four of the biggest sites that offer home-value estimates get 100 million visits a month, with web surfers using them to determine what to ask or bid for a home, or whether to refinance.

But for figures that can carry such weight, critics say, the estimates can be far rougher than most people realize. Valuations that are 20% or even 50% higher or lower than a property’s eventual sale price are not uncommon, as the sites themselves acknowledge. The estimates frequently change, too—sometimes by hundreds of thousands of dollars—as sites plug new data into their algorithms.

Appraisers and real-estate consultants say the online models can veer off target with alarming frequency. Most data for the models come from two sources: records from tax assessors and listing data for recent sales. Collection is a challenge, however, because not every county tracks properties the same way—some calculate home size by number of bedrooms, others by overall square footage. And automated models aren’t designed to account for the unique construction details that often make or break a deal, or for intangible factors like a neighborhood’s gentrification. “You cannot use a computer model in certain areas and expect the value to come out right,” says John May, the former assessor of Jefferson County, Ky., which includes the state’s largest city, Louisville.

For all these reasons, models that banks use often add a “confidence score” to their estimates. Consumer-oriented sites, meanwhile, rely on disclaimers, some of which are eye-opening. Zillow surfers who read the “About Zestimates” page find out that the site’s overall error rate—the amount its estimates vary from a homes’ actual value—is 8.5%, and that about one-fourth of the estimates are at least 20% off the eventual sale price.

The sites argue that, over time, edits and corrections will help them perfect their numbers—with many fixes coming from their customers.

Zillow has accepted revisions on 25 million homes—perhaps the strongest testament to how seriously consumers take its estimates. Today, the site says its figures are accurate enough to give consumers a good sense of any home’s value. In the meantime, says Mr. Humphries, its economist, “We’re always tweaking the algorithm or building a new one.”

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Automated-valuation websites to check out:

www.zillow.com

www.cyberhomes.com – go to ‘Home Values’ page and input the address

www.homes.com – go to ‘Home Values’ page and input the address

https://www.chase.com/online/Home-Lending/home-value-estimator.htm

This house at the top of the hill in Leucadia has as good, or better ocean view as any you’ll see from homes around the coast – there is a marker on the street that memorializes the spot as the lookout point for enemy ships during the war!

Yet, this new house took five years to sell. Why?

Buyers aren’t willing to overlook the other negatives, and want the price to reflect.

In the last 12 months around the 92024, from sales of houses built since 2000:

Ocean View : 28 sales, avg. 3,556sf, have averaged $336/sf

Non-Ocean View:  81 sales, avg. 3,185 sf, have averaged $326/sf

Buyers will pay a little more for the ocean view, but, like in this case, want to properly value the small family room and freeway noise too.  Final tally here?  $325/sf:

We don’t know exactly how the survey was worded, but it looks like people would need to see their utility costs going up before spending money on improvements. From the latimes.com:

Homeowners need to complete an average of four energy efficiency upgrades, such as insulation or high-efficiency windows, to see their utility bills decrease, according to a new survey released Tuesday. Homeowners who completed only 2.3 improvements actually saw their bills increase 10% to 30%, according to the 2011 Energy Pulse Survey by the Shelton Group, a Tennessee-based marketing group focused on sustainability that polled 1,502 Americans. 

“[M]ost homeowners are more likely to start with a low-risk, low-investment improvement such as CFLs (compact fluorescent lightbulbs) or programmable thermostats that create a ‘quick win’ — fast results with minimal effort. Since quick wins reduce resistance and increase motivation, this should put them on the path to additional behaviors,” the study says. “However … many homeowners start and end with CFLs. The motivation to move on to the next activity doesn’t seem to occur naturally.”

Just 42% of the survey’s respondents had installed high-efficiency windows, 39% had added extra insulation, 37% had installed a higher-efficiency heating or cooling system and 24% had upgraded to a higher-efficiency water heater.

The No. 1 reason homeowners make energy-efficient improvements is to reduce their utility bills, the survey found. Yet the high cost and slow return on investment of the most valuable improvements has been a stumbling block. Replacing old, inefficient windows can lower energy bills 7% to 15%, but the payback period is between 10 years and 30 years, according to the study, citing Department of Energy research. Improving insulation can save 10% on an annual energy bill, but the payback period is 12 years to 26 years.

“The top energy-saving driver for the vast majority of Americans continues to be about dollars and cents,” said Suzanne Shelton, president of the Shelton Group. “It’s a green decision to save energy — but for consumers, it’s the green in their wallets that matters most.”

The highest-income and best educated Americans were most sensitive to utility bill increases and likely to take action. Those earning $100,000 or more annually said their monthly bills would need to increase an average of $113 to prompt an energy-efficient home improvement such as window replacement, whereas those earning less than $25,000 said their monthly bills would need to increase $120. Those with graduate degrees said it would take a $98 increase to trigger an energy-efficient upgrade, whereas those with a high school degree or less said the bill would need to increase $122, the study found.

Punky asked about what to look for in that “awesome I got everything going for me” house.

These thoughts are culled mostly from conversations with our buyers, personal observations, multiple bidding wars, with an emphasis on investment value and some anticipation of future trends:

 1.  Location – Because buyers are looking long-term, the flight to quality has never been so active.  Buying the best location you can afford will never go out of style. Being in a great school district is smart, even if you don’t have kids.

2.  Light and Bright – South-facing homes with ample windows that allow full sun are much preferred.  You may have to provide shade in the summertime, but you’ll save on heating bills in winter and overall have a sunnier disposition than those who live in a cave.  There will be more push towards solar panels at home, and they prefer a south-facing roof.

3.  Walkability – Being able to walk to shops is convenient, but also walking for exercise is smart too.  Does the location encourage you to walk more?  If so, I think buyers will consider it a preferred location, and might pay a little more.  If it’s close to the foothills, the mountain bikers will dig it.

4.  Security – Does the location make you feel safe? People already have concerns about their safety, and those could get worse in the future.  Is it a secluded spot?  Can anyone sneak up on you from behind?  Do the neighboring properties help or hurt?  Tracts with smaller lots can provide a ‘safety in numbers’ feeling.

5.  Privacy – No homes looking in, especially not looking down on you from above.  Up-slopes are acceptable as long as there is ample distance of flat area in between, and the houses above are set back so you don’t see them much.  The worst are the example shown at Viridian, where the house/stucco wall behind you is about 5-10 feet higher, and 20-30 feet away - it is an unsettling feeling.

6.  One-Story – My personal preference, and they are selling for an approximate 10% premium.  If you’d rather have a two-story, and then run into trouble later with stairs, know that you can always add an elevator – look for spots where you can devise a landing upstairs.

7.  Floor Plan – The most desirable houses are those with big open rooms that flow.  This can be fixed with an open checkbook, so use your imagination.

8.  Indoor/Outdoor Entertaining – For those who entertain, this is a big feature.  The outdoor kitchens are very popular, but just having a decent spot for a BBQ can satisfy many.

9.  ‘Visual Openness’ – Having a view is nice, but you should be guarded about how much premium you are paying.  The coast is so socked in with fog ’marine layer’ these days that you’re not going to see the ocean much, so the very max I would pay is $100,000 extra for the best ocean view – and it drops off in a hurry.  Most people are satisfied with having something pleasant to look at, so if you can see beyond the backyard, then the resulting night-light view gives you a 24-hour view of something.

10.  Guest Suite - A downstairs bedroom/bath can usually double as a den/office area, but the primary use is for guests – especially the in-laws.  Having it separated from the rest of the house is ideal, and it doesn’t have to be detached.

11.  Great Room – Having the kitchen/family room combo is imperative, and money can fix.  Includes a big-screen TV that you can see from the kitchen sink.

12.  Style, Character, ‘Pizazz’ – These are hot features for selling, and can be added easily.

13.  Three-car Garage – Otherwise known as the California Basement, the third-car garage usually hold people’s junk.  Why people insist on having so much junk is another topic.

14.  Master with Walk-in Closet – This item is imperative for the ladies; guys could live with a gunnysack or cardboard box – or with leaving their clothes on the floor.  It is probably an efficiency thing – being able to see the available selections probably makes it easier to choose, especially with shoes.  A window, or ample lighting in the closet is a plus.

15.  Game Room – If you have teenagers, a separate room is better for video games.

16.  Cul-de-Sacs – I can do without the screaming kids, but cul-de-sacs are a big boost for re-sale.

17.  Green – Good for energy efficiency/cost savings, but not many homebuyers will spend crazy money here – I wouldn’t pay more just because a house has solar panels.  Being self-sufficient and off the grid is a big draw, but paying the right price for the house is #1.

Things to avoid:

1.  Extra-large backyards – They cost too much to maintain and you don’t use them enough.  My rule-of thumb still stands – if you can mow the lawn in less than a half-hour, you’re good. 

2.  Pools are also out, especially at the coast - The weather is not hot enough that you will use them much (unless you swim for exercise), plus they take up too much of the backyard.

3.  Overgrown trees – If they are more than 20 feet tall, they’re probably too big and messy, and people are afraid that they’ll fall on the house.  People close to the coast would rather have sunlight.

4.  Condos – Unless they have exceptional other features, it’s better to rent, due to the difficulty in obtaining mortgage financing.

5.  High monthly fees – How long will it be before we see Occupy Mello-Roos?

6.  Three or more levels – Two-story is the max.

7.  Linoleum, single-pane windows, formica, 8-ft ceilings, etc. – all the old, dated stuff.

8.  Power lines nearby – Perceptions are particularly negative, whether accurate or not.

9.  Double-yellow-striped streets – Perceived as too busy, whether they are or not.

10.  Noise – Freeway, street, airport/jets, skateboards – not only are they a turnoff to potential buyers, they might drive you crazy.

11.  Close to a high school – The kids drive too fast, and don’t have respect.

The key is to find the right blend of ingredients for your particular needs.  If you can find most or all of the above, you will have an enjoyable house that will re-sell easily!  Focus on buying a house that already has items that money won’t fix (items 1-6 at top).  Your agent should be an expert at evaluating, and balancing the mix! 

Early in the hunt, surrender to the fact that whatever house you end up buying, it will most likely need repairing/updating/remodeling – plan to spend $25,000 to $50,000 after closing. 

Here are other links:

Trophy Properties: http://www.bubbleinfo.com/2011/08/15/trophy-properties/

Housing Trends of Future: http://www.bubbleinfo.com/2010/10/12/housing-trends-of-future/

WSJ.com – Blueprint for a New American Home (link here)

Multi-Gen Homes: http://www.bizjournals.com/phoenix/print-edition/2011/10/28/lennar-to-display-home-within-a-home.html

Here’s a handy website to use when searching for crime around an address:

www.crimemapping.com

They track the type of crime; you can search different time periods, and you can also register to receive crime alerts.  I haven’t used it too much yet, but quickness and ease of use is great.