Top 10 Reasons to Sell Your Home During the Holidays

I like this list of Reasons to Sell Your Home During the Holidays.  A little counterintuition can go a long way! -David

Top Staging Don'ts from HGTV

Here are home staging tips from HGTV to help buyers appreciate your home!

Top Staging Don'ts

Keep clicking past #7 and you'll see more good staging ideas. - David

The 2 Rooms That Really Sell Homes

According to Trulia as quoted in Forbes, These Are The 2 Rooms That Really Sell Homes.  I can't disagree, but would offer an additional point:  Before taking it upon yourself to select your home repair and fix-up projects in advance of a sale, contact a knowledgeable Realtor to find out what really matters to buyers in your specific market.


It's nearly impossible for a homeowner to be objective in selecting what to change about their own home to make it appeal to today's buyer. Thus it's easy to overspend, or spend on the wrong things, or delay your sale unnecessarily while making the wrong upgrades!  -David

More Homebuyers Willing to Compromise

Do you agree with survey results saying that More Homebuyers Willing to Compromise than home sellers?

-David

Appraisal Coming Up? Here's How to Optimize It

Ten Tips to Up Your Home’s Value During the Appraisal is a good review of what matters to an appraiser, and therefore to you if your home is being appraised for a sale or refinance. - David

10 ways to turn off a homebuyer - From Bankrate.com

One of the first steps in selling your home successfully is learning to view it from the prospective homebuyer's point of view.  From the "don'ts" perspective, here's a good list of 10 ways to turn off a homebuyer from Bankrate.com, a great source of banking and mortgage information.

Zillow Got You Down? Look Beyond the Averages!

Speaking with a good friend and very savvy client this morning, I happened to comment that "Zillow is directionally correct 50% of the time" for overall prices in a given local market.  Of course this is because Zillow uses mathematical algorithms that fail to address property condition, changes in sales mix, shortages in inventory, and similar qualitative and quantitative factors not available without a modicum of local expertise.

As an example, relying on Zillow, one could easily conclude that property values in Manhattan Beach have suffered to the tune of 5-8% in recent months.  This dramatic but misleading conclusion results from what I call the "tyranny of averages." By this I mean that averages of non-homogeneous groups (e.g., newer homes vs. older, desirable homes vs. teardowns, better locations vs. commercially-impacted streets, markets including builders vs. markets without significant building activity) are little more than hash totals until underlying factors are revealed.

In the Manhattan Beach Tree Section and in East Manhattan, few newer, larger, highly-desirable, well-located homes have been available in the inventory of homes for sale in recent months.  I have well-qualified buyers for both RIGHT NOW, and have yet to find suitable properties to match their needs. As a result, Tree Section statistics are skewed toward smaller, less-desirable properties that have been marching through the ranks.  Zillow interprets this as meaning Tree Section sales volumes and values are down, an uninformed conclusion.

The reality:  South Bay Brokers' sales are up 18% year-over-year from 2010.  Of course that's a composite number too, but I can give you the details!  In fact, many such details can be found at the South Bay Market Data section of this very Beach City Digs Blog!

So as frequently mentioned in this blog, watch out for averages.  You'll find them rampantly reported in the general press, which is a great place for real estate ads but seldom for actionable real estate news.

Instead, rely on a qualified real estate professional who knows and understands the micromarket, the underlying factors, the prevailing trends, and how to have peace of mind dealing with them all. -David

What To Fix Before You List

With housing prices down across the country, there are a lot of homeowners barely breaking even on their respective home sales. Some are even losing money.
You may find yourself in that position, too; wanting to sell, but worried about bringing cash to your own closing.
It creates an interesting dilemma. You want your home to "show nicely" relative to comparable properties, but you don't want to invest big dollars that may never be recouped into upgrades or renovations. So what do you do?
The answer is simple. Do the bare minimum.
From an advice piece in the Wall Street Journal, we learn of 10 basic home improvement projects that will help your home have better showings. The advice requires almost no technical skills, and the projects be tackled in a weekend.
The theme? Handled your home's delayed maintenance.

1. Repair or remove screen doors with holes and tears
2. Pressure wash windows, sidewalks, and siding
3. Paint your front door and polish the doorknob
4. Pull weeds, seed bare spots, and lay down mulch
5. Touch up holes, dings and cracks in paint
6. Clean grout and re-caulk sinks, bathtubs and showers
7. Buy new cabinet hardware
8. Fix leaky faucets and toilets
9. Spray lubricant on squeaky doors
10. Get clutter into storage and out of the way

Now, you'll notice that none of these projects can be considered "major". By contrast, each is minor; they're the items you'd add to your to-do list for work on "another day". However, they're extremely important for a home that's about to be listed.
Here's why. A prospective buyer doesn't notice that the above repairs were made. He only notices if they weren't made. When a buyer sees ripped screens or chipped paint in your home, it makes him wonder what else hasn't been cared for. This is the why you should also hire an exterminator prior to selling your home. If a buyer spots a trail of ants in your home, it's unlikely you'll get an offer.
You don't need to spend big bucks to get your home ready for sale, but you may to use apply elbow grease. The good news is that time spent up-front can be worth it in the end. Homes that show better tend to sell faster, and at higher prices.

22nd CONSECUTIVE YEAR WTH THE HIGHEST RESIDENTIAL VOLUME PER AGENT

Even the LA TIMES Thinks Now May be the Time to Buy!

Any time the LA Times writes about real estate, it's difficult to know whether to expect which theme will dominate: "doom" or "gloom."  So when they publish an article saying Now may be the time to buy a home, something big must be going on (or the business editor was vacationing).  There is: interest rates are on the upswing as we've been saying for some time.

Don't lose sight of the fact that higher rates reduce affordability, so potential sellers should be as interested in this news as potential buyers.

Now if you check the reader-submitted comments accompanying the Times article online, you're bound to see the doom and gloomers arguing for waiting till rates go up, thinking this will cause prices to crash.  These folks miss two critical points: the crash already happened (not sure how anyone could have missed that), and affordability is hugely impacted by rates.  - David

Cash Buyers on the Move

We are definitely seeing this effect in the South Bay.

Cash Buyers Boost Battered Housing Markets - WSJ.com

Those who stored cash are purchasing real estate in the highest price ranges, but also at more moderate levels - - sometimes as investments.  Many of the Strand and Hill Section (Manhattan Beach) sales have been all cash in recent months, and those aren't on sale! - David

Choosing a Realtor to List your Property

A potential client phoned me to day to ask about listing his Sand Section property.  We discussed his goals at length, and agreed to meet on the weekend.  Later in the day I learned he had phoned an entire army of Realtors to set up appointments with them on the weekend in hopes of grinding them on commissions (and unknowingly securing for himself the least valuable, most desperate listing agent).

With that information in hand, and knowing that the value of his property is considerably less than his hoped-for price, I sent the communication which follows.  - David


"Dear [Potential Client],

As you can see, we are well networked and we do our homework.  Based upon our discussion and an analysis of your property, I would be happy to provide you with the best, most professional service you are going to find. Your motivation to sell is strong, so your representative in this transaction should be as well.

Our goal would be to bring you the maximum net proceeds for your property within the timeframe you have defined. That means neither the maximum listing price (promising you something that is unrealistic, otherwise known as “buying your listing” and then begging for price reductions after the listing has gone stale), nor the maximum selling price (regardless of whether it will appraise), nor the minimum commission percentage (meaning the lowest service or the least valuable, most desperate agent), nor the quickest sale (to a buyer who ultimately backs out when the numbers don’t work).

It means the maximum net proceeds within your time constraints after all is said and done. As you mentioned today, it takes a professional to do a professional’s job. And in your situation, it takes a Realtor with serious development experience [the property has building potential] and contacts. Speaking freely, it also requires straight talk and strong negotiation skills, as evidenced by working only on a full service basis.

We offer you all of those resources, because professionalism matters if your goal is maximum net proceeds and a transaction that doesn’t come back to bite you.

If that makes sense, then I’d love to be of service. By the way, the right full-service Realtor will also enable a smooth transition to your next home.  It's not to early to start envisioning that goal.

Please let me know how you would like to proceed."

Unexpected Happenings: A Cash-in Refi? Standard Sale of an Underwater Property?

Here's a new term for you: a Cash-in Refinance. It's not a recommendation, but an interesting concept whereby homeowners wanting to refinance their homes but having little or no equity actually contribute new funds at the time of the refi. It's one way to take advantage of the amazing rate environment we're experiencing, and there are scenarios where this actually generates a positive return.

Another approach, if you are slightly underwater, is to pay the difference on sale of your home, in order to preserve your credit while getting highly favorable loan terms and a great price on a trade-up property.

More info: Doubling Down on Housing - WSJ.com

-David

New Home Sales Plunge - - Wait, I Thought They Were Up!

A recent post on this blog told of how home sales were considerably up in May.  In this one, I'm relaying a report by the Wall Street Journal that home sales were considerably down in May.  Head spinning yet?

Both posts are true, revealing the difficulty in understanding the housing market by merely glancing at headlines.

The posts refer to different measures:

• Sales of existing ("used, gently or otherwise") homes were indeed up 19.2%
• Sales of new (previously unoccupied) homes (often mistakenly interpreted as new sales of existing homes) were down by 32.7%.

Why would this be the case, and which if either should you care about?

Well, new home sales are certainly good for the economy, but they are a small percentage of the total inventory of houses.  But besides pure levels of buyer demand, new home sales are greatly dependent upon the number of new homes that builders are building!  So if homebuilders are not building as many homes as before (they aren't), or if special financing isn't being offered in this market, then that measure will tend to decline.  You should care about this if you are a homebuilder, or invest in homebuilders, or are an economist, or live next door to an enormous new tract offering big discounts and 0% financing..Personally, I care much more about the number of new housing permits issued than the number of new homes sold.

Existing home sales have to do with the natural turnover of the nation's inventory of homes, whether built in 2009 or 1909, so long as they've been previously occupied.  This is a much more telling economic indicator with respect to the housing market.  You should care about it if you're a current or prospective homebuyer or seller!  But like any measure, I wouldn't worry too much about it on a month to month basis.  Because it may or may not be "seasonally adjusted," and it may or may not be affected by factors as simple as a different number of days in the month!

More info: New Home Sales Plunge - WSJ.com

For the real story, you need local data.  Ask your Realtor! -David

How to Display Artwork

Artwork makes a huge difference in the appearance of a room; otherwise, why would you display it in the first place? But whether it makes a positive difference or not is another matter. A staging professional can provide excellent advice on how to enhance a room with artwork without over-personalizing, the bane of the home seller and their Realtor! More info here: Architecture Coach: REALTOR® Magazine - David

Home In Escrow but Won't Appraise?

One of a buyer's key purchase contingencies is the appraisal contingency. If you're asking considerably more for your home than your Realtor advised, and manage to get into escrow for close to that amount, you might be at risk.  But what if your home is reasonably priced and still doesn't appraise for the agreed-upon purchase price?  Then you're going to need a truly knowledgeable Realtor (or with you had one!) to help fight back against a low home appraisal.- David

Fixing Up or Selling As Is: Relevant Considerations

As in just about everything except scuba diving, it doesn't make sense to go overboard when fixing up a home to sell.  BUT, certain fixes may pay for themselves several times over in terms of attracting offers and getting maximum value.  Inman columnist Dian Hymer explains this well in Fixing to sell: Don't go overboard | Inman News. -David

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Overcoming Clutter - A Good Choice to Make!

One of the biggest problems that must be addressed when preparing your home for sale is clutter. Those treasures scattered around your home represent distractions and potential turn-offs to possible buyers, who have a tendency to remember cluttered homes for their clutter, not their true merits.

This is not unlike homes that have been over-personalized, and are remembered for their orange shag carpet, polka dot window coverings, or strange furnishings. Sorry, but the sad truth is that

Side Deals in Real Estate Sales? Bad Idea

Buyers and sellers will sometimes be offered or asked to accept undocumented side deals in real estate transactions.  This is a great way to introduce surprises, disappointment, risk, and potential legal problems into an otherwise clean transaction.  Sound like a good idea?  No, and that's the right answer if you're asked to do so. 

Side agreement forced on you? Look for a new property, a new Realtor, or both. - David

More info: Home-sale side agreement has pitfalls - latimes.com

Fix or sell as is?

Now that's a fixer (click for photo source)!!!

Whenever it's time to sell a home, the "fix or sell as is" question comes into play.  The trick is to make sure the home won't be remembered for what is wrong with it, for what doesn't fit into the neighborhood, for what was over-personalized.  - David

For more info: Avoid home improvement gimmicks that hammer resale value Inman News