Recently in Selling a Home Category

June 6, 2011

Houses With No Fix-Up Responsibilities Don't Exist!

The decision of where to live in retirement is tough enough by itself. But when you've got two spouses who disagree on priorities, the stress levels can shoot through the roof.

This was exemplified by a conversation I recently overheard (couldn't help but overhear, really) in which a man was describing how his wife not only wants to downsize for retirement, but dreams of finding a home that doesn't need any more fix-ups -- a newly built home, perhaps.

What's more, she has apparently been protesting whenever her husband fixes up their current home, on grounds that they'll soon be selling it and moving to that mythical "house that won't need fixing." The man doesn't agree with any of her arguments, but felt like protesting would risk their marriage.

I had to bite my tongue -- though it's the wife I'd really like to give some commonsense advice to (assuming hubby is telling the straight story).

d9b.JPGFirst off, a house that doesn't need fixing? It doesn't exist. Older houses, though in many cases well built at the time, will inevitably need attention to combat the effects of aging. A new roof, new foundation, structural changes if you want to remodel and need to bring other aspects of the place up to code in order to get a permit, are all on the list of likely fix-ups.

Newer houses, meanwhile, though fresh and up to code, can be a nightmare. Hurried and often shoddy construction -- basic stuff, like windows installed wrong way out -- by developers trying to make a buck in a tough economy are typical complaints . (For more on that, see Nolo's article, "Newly Built Houses: Pros and Cons of Buying.")

As for putting off maintenance because you think you're about to sell? Bad idea, unless you want to sell for far less than you could have. Deferred maintenance leads potential buyers to wonder what deeper problems you've also been ignoring, and to lower their offer price accordingly -- or just pass on the house altogether. Just what shape the house should be in is covered in Nolo's FAQ, "How much should I fix up the house before selling it?"

Sad to say, I'll probably never find out the end of this story. But I imagine it's playing out among numerous couples around this country, with numerous endings.     
May 27, 2011

Few Real Estate Agents Write "Just Right" Marketing Prose

Have you noticed how agent-speak, as seen in real estate ads, tends to be either over the top or underwhelming?

IMG_2954.JPGMore often the former, of course. Just looking at today's local real estate section, it's easy to pull out grand, sweeping, and did I mention grand, statements like:

  • "Spectacular views & magical sunsets!"
  • "Enjoy the spacious sun drenched living room with views!" and
  • "Truly an entertainer's delight and magical at night!"
(Does it say somewhere in the real estate agents' handbook that you must use lots of exclamation points and the word "magical?")

Oh, and here's my favorite: "This gracious, four-bedroom, two bath . . . Tudor emotes a bygone era."

I'll give the agent a small gold star for ditching the exclamation points, but what's with "emotes?" Sounds like the house has taken up method acting. I'm guessing she meant to say "evokes." Or maybe she just got tired of the same old words and decided to get, uh, creative.

Now, for the underwhelming bits of prose -- the ad language that makes you go, "That's supposed to appeal to me why, exactly?"

Again from today's paper, we've got, "Shows very well."

Okay, now that's something an agent might say to another agent, but if I were a prospective buyer, I'd wonder what it says about the house after the staging is gone. It's like saying that someone looks really good with makeup on. 

Or this one: "Grass covered back yard!" Whoa. Better put that one on your must-see list.

And my fave from this list, which isn't an ad for a house, but for a mortgage broker, which contains the following customer testimonial:

"Buying a house is stressful, but working with Sue was one of the most positive and least stress-inducing aspects of the process." Hmm. So how stress inducing was working with her, exactly? They should've stopped at "most positive."

Just for a last bit of fun, here's an ad from an agent who tried to do something a little different: "SWEET STARTER SEEKS SINCERE BUYER. Me: Mature 2BR stucco near shops and San Francisco express bus. You: Looking for affordable cottage in desirable area."

At least he left out any mention of magical sunsets.

P.S. Choosing a selling agent? Read their ads first. Some of the larger brokerages have a marketing person handling all the writing, which can add a layer of professionalism and quality control. In any case, when it comes to your house, ask to read the copy before it goes to press.

 

May 19, 2011

Fighting Over Fixtures: Not Just a U.S. Syndrome

The United States practically invented litigiousness, so you might think that the frequent arguments between home buyers and sellers about what stays and what goes was a uniquely U.S. phenomenon.

Disputes regularly crop up about curtains, light fixtures, appliances, plants in the garden, cabinet knobs, and more. Sometimes the seller leaves the buyer a rude surprise and strips the house of favorite features just before departing. 

So, we can take some small comfort in discovering similar behavior goes on right across the pond (albeit with more charming vocabulary, for those of us with Anglophiliac tendencies). It's all revealed by Country Life magazine from the U.K., in a December 2010 article called, "Fighting over fixtures and fittings."

Here, we learn about:
 
  • the seller who demanded money for each of the "loo-roll holders" in the bathrooms
  • the seller who counted up all the lightbulbs he was leaving in the house (mansion, really) and asked to be compensated for those
  • the sale that nearly fell through over the sit-down lawnmower (the real estate agent saved the day by purchasing it for the buyers out of his own pocket)
  • the seller who insisted on removing both the integrated dishwasher and the "bespoke panel" that topped it (I had to look up "bespoke" -- it means custom-made)
  • the seller who removed the mahogany loo seats without replacing them
  • and more!
lightbulb-735969.jpgDo these disputes become more understandable when we realize that Country Life focuses on high-end properties, as in multi-room manors or country houses? Those lightbulbs and loo-paper rolls can really add up.

But the human tendency to get bogged down on small details seems to transcend country or price.

As one agent quoted in the article aptly put it, the two parties tend to develop "stiff-legged terrier syndrome. . . . even with houses worth several million pounds."

For a reminder of what a home seller is expected to leave behind in a U.S. property -- although the buyer and seller can always negotiate differently -- see the first question in Nolo's "Selling Your House FAQ."  
May 13, 2011

Real Estate Agents Developing Specialties

bottles4_exb_HSTR2103.jpgJust as with flavors and caffeine levels of soda pop, the choices to be made among real estate agents has expanded over the years -- despite, or maybe because of, the down economy.

As Marilyn Kennedy Melia points out in her article, "1. Change, 2. Choices," you can now find agents to help with short sales, foreclosures, buying or selling a "green" home, and more.

Meanwhile, other agents have (according to seemingly good authority within the article -- namely me!) packed up their offices and headed for careers with less uncertainty and competition.

Marilyn also quotes me as saying it's worth asking agents about their negotiating style before signing them up. Indeed, carefully observing an agent's personal style and trying to get a handle on how he or she will represent you in front of the other party is particularly important for both buyers and sellers, because negotiations can get contentious.

Buyers have leverage in today's market, and they know it. Many deal have fallen apart over amounts of money both large and small, for example because the buyer negotiated hard over repair costs after the home inspection. It's all too common for either the seller or the buyer -- or both -- to start to "take a stand" on mere principle, forgetting that the ultimate goal is to transfer the house.

WIthout a skilled agent to smooth relations with the other party, not to mention provide a voice of reason when you yourself most need it, a deal that looked rosy one day can simply wilt and die the next.

By the way, I've got a whole list of other questions you might want to ask agents before signing them up -- you'll find it in the article "Choosing Your Real Estate Agent."
 
May 4, 2011

Sellers: Fixer Uppers Are So Passe!

It's not too surprising, really, what with buyers having lots of leverage in the real estate market, and probably working hard to save a buck (or thousands of 'em) for a down payment: Fixer-uppers just don't have the allure they once did.

Big fixer upper.jpgIn fact, a recent Coldwell Banker survey (reported on in the International Business Times article, "Buyers Bypass Fixer-Upper, Want Move-In Ready") found that 87% of home buyers are looking for a move-in ready home.

Not only that, agents say that buyers are willing to pay extra -- or overpay -- to avoid the responsibilities that come with a home in need of repair.

That brings sellers back to the perennial question of, "How much fixing up is enough?" Do you need to simply patch the cracks, replace some roof shingles, and repaint, or is it time for a complete overhaul, or at least a remodeled kitchen or bathroom?

Definitely start with the basics. But before doing any major remodeling -- which you won't even get to enjoy, if you're planning to sell soon -- consult with your real estate agent and check out the advice in Nolo's article, "Do Home Improvements Really Add Value?"
April 27, 2011

Looking Past the Staging: Lesson 1 for Buyers

In more and more parts of the United States, the days of walking into a home for sale and seeing kids' photos, favorite team pennants on the walls, and a kitty litter box in the bathroom are long gone.

They've been replaced by "staging," in which most or all of the seller's possessions are cleared out and replaced by specially chosen and designed furniture and accessories. The final effect should make the house look both inviting and thrilling -- a place to imagine your life will be better than it's ever been.

Do I encourage staging for sellers? Absolutely: I've seen it produce fast sales at full price or above in too many cases to doubt its effectiveness. 

But if you're a home buyer, you need to keep your wits about you. Remember that, as wonderful as homeownership might be, your life will still involve the need for things like space for normal-sized furniture, storage, and so forth.

Take the photo below, for example. It's a beautifully done staging job, which makes everyone who sees it go, "Aww." As a seller, I'd be delighted.

IMG_3213.JPGBut if you're the buyer, you have to ask yourself: Will this room fit a bed and desk for when the baby is a teenager? Maybe not. Using pint-sized furniture is a common way for stagers to make a small room look bigger. In fact, you might want to bring a tape measure and a list of measurements of your important pieces of furniture.   

More lessons to come . . . .

Continue reading "Looking Past the Staging: Lesson 1 for Buyers" »

March 28, 2011

Good News for Home Sellers: You're Competing With Less New Construction Than Ever

daffodil.jpgThe spring real estate market is upon us, with open house signs sprouting up right alongside the daffodils. If you're a seller, this can feel like a mixed blessing -- buyers are showing renewed interest, but you're facing increasing competition from other sellers, in a market that's still pretty slow.

But here's some news to help build your confidence: According to Metrostudy (as reported on by Shawn Tully of Fortune, in an article called "Real estate: It's time to buy again"), there's a major shortage of new construction going on in the United States.

Just a few years ago, we were looking at a glut of new homes, luring some homebuyers away from established neighborhoods into new developments. But no more.

What's more, demand for homes to buy may be poised to go up, as apartment rentals have become expensive and harder to come by. (The huge numbers of people who've been foreclosed upon are a factor here -- they're hardly going to want to, or be able to, rush back into homeownership.)

All of which is to say that, no matter what's for sale down the block from you, your place may still be relatively unique, among a amount of housing stock available to prospective homebuyers. And all it takes is one buyer.
February 28, 2011

In a Divorce, Is It Best to Sell the House?

Given that January was the month in which the most divorces were (according to the averages) filed, the question on a lot of former couples' minds right now is probably, "Who gets the house -- or do we sell it?"

The issue has only gotten thornier since the recession, with both house values and earning power down. As explained in the article, "Divorce Wannabees in the Age of Recession: How Trapped Couples Are Coping," by Roslyn Zinner of the Huffington Post, couples who are underwater on their mortgage or have significant other debts simply can't, in some cases, afford to split up the household -- leading to situations where, for example, one spouse "moves" to the basement.

Hmm, could there be a silver lining in Zinner's description of how couples don't fight over the house so much anymore, since neither wants to deal with the costs of homeownership? Okay, never mind.

Interestingly, one solution she describes -- in which the couple agrees to continue jointly owning the home, while one moves to an apartment, and they sell when the economy is better -- was exactly that arrived at (after much negotiation) by a Los Angeles couple described in the Financial Adviser blog titled "Breaking Up Is Hard to Do," by Zack Anchors, in the Wall Street Journal.

So, if and when the market turns around (whenever that might be, which no one can safely predict), we may see a flood of homes being sold by long-divorced couples!


February 24, 2011

Where Should Your Cat or Dog Go During House Showings?

Ask any experienced real estate agent about whether a cat or dog should stay in the house while prospective buyers are touring, and the answer is usually, "No way." As with everything about preparing a home for sale, you're trying to appeal to the "average" person, and that person may not be a cat or dog lover, or may even be allergic.

Not to mention the pets' own interests -- seeing hordes of people tromping through the house may prompt them to make a quick escape through an open door.

But The New York Times added some new food (or kibble) for thought on this topic with its article, "Pets Help Sell Manhattan Apartments," by Constance Rosenblum. It's full of stories of cats and dogs that charmed the prospective buyers, added a sense of warmth to the apartment, in some case literally showed the visitors around, and were missed when the new owners moved in and the four-pawed friend was no longer there to welcome them.

You'll want to read the story for yourself. But here are my conclusions about why it worked in these cases, or how a pet  can be useful in the homeselling process.

dog-relaxes.jpg1. It all hinges on whether the cat or dog is seriously cute. If so, you might give it a try at individual showings at least, if not necessarily at the open house. Not all pets have the same degree of magnetism. If you've already noticed that your cat or dog becomes the center of attention at every party you give, makes friends with people who swore they didn't care about animals, or attract exclamations like, "Awww" from every passerby, maybe this is a pet that can be drafted into home-selling service. (The opposite goes for barking dogs and cats that give people the stink-eye.)

2. If you're going to keep the pet around, make sure there are no animal smells. Put the kitty litter box as far from the madding crowds as you can (of course, show the cat where it is), and invest in the most expensive, odor-defying litter. For dogs, perhaps do as Wraggles' owners did, in the NYT story, and have the dog bathed and groomed before showings.

3. If having the actual animal at showings isn't realistic, consider including it in your publicized photos of the property. Hey, all the home furnishing catalogs do it, why not you? A cat or dog creates a focal point, and helps make your home look like a cozy place.

What commission you negotiate with a cat or dog who helps you sell is up to you. But a treat is no doubt in order!
 
February 17, 2011

No, You Can't Deduct Losses on the Sale of a Home

This myth has been busted a zillion times, and yet it persists -- maybe because taxpayers believe that the tax code should make logical sense. If you have to pay capital gains tax when your profits on the sale of a house exceed the $250,000 (or $500,000 per married couple filing jointly) exclusion, then why shouldn't you be able to apply your losses on a  home sale against any other capital gains?

image_3_Thumbnail.jpgOops, looks like I boxed myself into a corner where I now have to explain this. The short of it seems to be that a house is considered "personal property" by the IRS, and personal property gets special treatment -- and not the good kind of special. You pay taxes on the gains from the sale of personal property, but get no benefits from the losses. (Perhaps they're trying to avoid having people take massive deductions for every item sold cheap at a garage sale.)

Worse news yet, if you had to sell your house for so little that your lender needed to forgive some of your debt (as with a short sale or a deed in lieu of foreclosure), the IRS may try to collect tax on the amount of the forgiven debt. The reasoning is that it's almost like your lender handed you a check, which is income -- never mind that you then handed it back to the lender. But don't panic: You may qualify for relief under the Mortgage Forgiveness Act, described by the IRS at www.irs.gov/newsroom/article/0,,id=205004,00.html