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Category Archive: ‘Tips, Advice & Links’
Here’s the best reason to fix and clean your house before selling.
It is irresistible for buyers to add up what they think needs to be fixed, and subtract it from your price. I-R-R-E-S-I-S-T-I-B-L-E.
Some make a sport of it, with both husband and wife scurrying around to see who can find the biggest flaws – and then attach an approximate cost to fix.
But their number is usually double the actual cost, because they aren’t that familiar with the costs, plus they add extra for the hassle factor too.
If a seller is going to get dinged for the damages anyway, they might as well fix them in advance to help the chances of selling for top dollar.
“Can’t we lower the price instead?”
Buyers don’t want to give sellers any credit for pricing in the condition of the home. If it needs work, they want a break on the price. They want to deduct their cost expectations from whatever the list price is, and then double-ding you again once they complete their home inspection.
This didn’t matter as much during the frenzy. But from here on out, we will be experiencing less-than-frenzy conditions.
P.S. I was serious about removing half of the contents. Most houses are full of the sellers’ valued possessions, but they look like junk to everyone else.
My specific tips here: Tips on Preparing Home for Sale
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Two different slopes at two different homes:
Rob Dawg said, quoting this latines.com article:
“Regular marketing doesn’t work anymore.”
Seems the RE industry is at a crossroads. Marketing or facilitating. One need only read the quote and see which way the wind has shifted.
Houses are worth different prices to different people on different days. Employing a marketing strategy that exploits the initial urgency will produce the max value.
P. S. If all agents offered all the same services, it would force consumers to examine the agent’s expertise and track record.
The quick sale at Via Mariposa fell out.
The emotional swings of falling in love with a staged home and winning a bidding war were quickly brought back to earth by the home inspector.
I don’t have a problem with the defects found by any home inspector – that is their job. My beef is with their bedside manner – it’s how they explain the issues that cause problems. The over-zealous inspectors who are only concerned with CYA will lay out every problem as if the house is falling down.
The only hope is that the buyer’s agent can offset the concerns with sound advice about how to solve them. Because if the buyers are going to keep looking until they find a perfect house, they are going to be in for a long wait.
The industry has had this topic backwards since the beginning of time, and it’s not going to change. We’re going to negotiate the sales contract first, and then worry about the repairs later. When defects are found in a house during a seller’s market, most listing agents are going to expect the buyer to eat it and in many cases they do.
But we’re in a maturing market now, and buyers are less willing to pay top dollar AND incur a repair bill too.
In this case, the buyer’s agent was a recent licensee working for a big team, which happens a lot. Because they don’t have the experience of knowing what to say in the moment of impact, they push the panic button and join the cancellation parade. If these issues aren’t addressed in the moment, it takes a miracle to resuscitate it later.
What can be done? Provide a written home inspection prior to the property hitting the open market.
The buyers are welcome to hire their own home inspector, but there are immediate benefits to all:
- Any potential issues are on the table before negotiating.
- Buyers might be satisfied with the first inspection.
- Buyers may question their own inspector’s opinion.
Providing an inspection report upfront will help to smooth out the highs and lows of the homebuying experience. While I’m all for the enhanced first impression created by staging, it’s not enough to get buyers to the finish line.
Meanwhile, back on the case!
More notes on staging and its effect on sales.
Staging delivers a great first impression – it’s probably worth it for that. But staging is just a component of the overall package needed to sell a house – especially for top dollar.
Examples from the weekend:
1. An agent called me on Saturday morning to tell me her client was gushing over the home on Via Mariposa, and they were going to make an offer. But nothing happened, so I pinged her on Sunday morning. She got back to me on Sunday night, and said her client re-considered, and decided not to make an offer. In her case, the staging wasn’t enough.
2. A lady asked me at open house, “I wonder what this house looks like without the staging?” Some buyers want to see beyond the staging.
3. Kayla said, “I’m not a big fan of the blue/teal color combination”. The staging will have a different impact on different people.
4. An example where staging really paid off was with the out-of-town buyers. There were multiple out-of-towners viewing homes via FaceTime, Skype, and video – the staging has to have a positive impact when you are looking at a small screen from afar. The eventual winner at Via Mariposa was one of them – a family member saw it in person, and online photos and video did the rest.
I am comfortable with buyers making informed decisions based on video/FaceTime actions. People trust the smartphones for everything else in life, might as well use it to buy a house!
Staging got the ball rolling, and got buyers engaged. But the rest of the house had to look sharp, and the price had to be attractive too. There were about 20 showings of that house over the first four days on the market, and we had three written offers. For seventeen buyers, the staging wasn’t enough.
After offers are submitted, the end result doesn’t just happen by itself. I’ll take the credit for giving every buyer a fair opportunity to step up and pay top dollar for the home, and guide it over list price. It’s the talking to people that makes the sale!
Is there an easy answer to how much sellers should spend on repairs, to sell?
You see me on various jobs talking about projects undertaken by sellers – and the scope of the project are almost always related to the house’s age. You want to bring houses up to speed, but items that are dated and hard to change (eight-foot ceilings, split-level, bad yard, etc.) make it a real challenge.
Where do you start, and where do you stop?
Work it backwards. Those who live in a super-custom area (RSF, Del Mar, La Jolla, etc. where values can vary widely from lot to lot), have a wider range.
But those who live in tract neighborhoods can expect home values to range roughly 10% between the fixers and the cream-puffs. The newer the tract, the easier it is to predict where you are in the range, because the improvements are more likely to be similar.
If your house is mostly original, buyers will expect to pay a minimum of 10% less than the comps that have been fully remodeled or have other positives (view, big yard, one-story).
If you can find a way to spend less than 10% to get your house from fixer to full retail, then do it. Your renovated look could spur a bidding war, and/or provide additional benefits later like easier repair-list, easier appraisal, and less chance of fallout.
If the cost of needed improvements exceed 10% of your current value, then just sell it as a fixer, and have your price do the work – list for 10% under the renovated comps.
There are other variables – a bad agent can cost you 2% to 3%, and a great one can add 2% to 3%. Quality contractors at reasonable prices make a substantial difference, and timing is everything!
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Tori Prince of Transformed to Sell stopped by to give us some tips on staging a smaller house in Carlsbad. She can give a basic consultation for $250 up to a full transformation of a luxury home. Her quote to furnish this 1,800sf two-story house was $2,600 to $2,900 for a 60-day period:
Here are some great tips for those who are getting ready to sell your home – and none of these involve renting somebody else’s furniture!
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Spend smart money to improve your chances of selling: