AFY Ingrid Rojas -Divorce

BEST SELLING OPTIONS IN A DIVORCE

Ingrid Rojas

All rights reserved. No part of this publication may be reproduced, distributed, or transmitted in any form or by any means, including photocopying, recording, or other electronic or mechanical methods, without the prior written permission of the publisher, except in the case of brief quotations embodied in critical reviews and certain other noncommercial uses permitted by copyright law. DISCLAIMER AND/OR LEGAL NOTICES: While all attempts have been made to verify information provided in this publication, neither the Author nor the Publisher assumes any responsibility for errors, inaccuracies, or omissions. Any slights of people or organizations are unintentional. This publication is not intended for use as a source of legal or accounting advice. The Publisher wants to stress that the information contained herein may be subject to varying state and/ or local laws or regulations. The reader of this publication assumes responsibility for the use of these materials and information. Adherence to all applicable laws and regulations, including advertising and all other aspects of doing business in the United States or any other jurisdiction is the sole responsibility of the reader. The Author and publisher assume no responsibility or liability whatsoever on behalf of any reader of these materials. If your property is currently listed with a Realtor, please disregard this notice. It is not our intention to solicit the offerings of other brokers. Printed in the United States of America

Table Of Contents

1. Moving On

2. Be Prepared

3. Marital Settlement Agreement

4. The 80/20 Rule

5. Relating The 80/20 Rule To Home Selling

6. Creating Curb Appeal

7. Staging With Purpose

8. Upgrade With ROI In Mind

9. The Three D's

10. How To Market Your Home

11. Common Seller Mistakes

12. Avoid Costly Mistakes

13. Finding Buyers

14. Be A Power Negotiator 97 15. The Dos And Don'ts Of Negotiating 105 16. Bargaining Chips 113 17. Serious Considerations 117

Preface When I first ventured into the real estate industry years ago, I did so with the hopes of helping sellers like you avoid the headaches often associated with the home-selling process. In my years of experience, not only have I helped alleviate the stress of selling for numerous clients, but I’ve also accumulated years of knowledge to help them get more money for their homes in the least amount of time. I decided to share all of my expertise in one place with potential clients. And that’s why you’re receiving this book. I want to help you have the best possible home-selling experience. And by that, I mean I want you to 1. Get the most money possible for your home, 2. Sell in the least amount of time, and 3. Avoid the headaches most commonly associated with the home-selling process. Think of this book as my gift to you. It contains insider advice on the home-selling process to help you achieve your ultimate real estate goals, including: • Secret strategies to sell your home for more money • Marketing techniques employed by top agents • Advice on how to appeal to today’s buyers • And much, much more If, after reading through it, you want to hire me to help you sell your home, I’d be more than happy to meet with you to discuss a specific plan to sell your home. Happy reading!

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CHAPTER 1 Moving On

Divorce is not easy. Even the most amicable separations are plagued with disappointment, lack of communication, and failed expectations. In the best case scenario, two people who are dissolving their union will work together to resolve their differences productively and part ways, hopefully without drawing blood. Unavoidably, though, during the process, you and your spouse’s emotions will fall prey to a myriad of changes as the marriage, family, and shared assets are legally separated. Adding to the stress is the sale of the family home, which is typically the largest asset of the marriage. This can evoke tremendous emotion: sadness, anger, sentiment, and disappointment, to name a few. The combination of the stresses of the divorce with the sale of the family home requires patience, diligence, and great personal fortitude. With the help of seasoned, experienced professionals — such as attorneys and real estate agents — divorcing couples can successfully move through this challenging phase of their lives and on to their future. The phrase “and this, too, shall pass” has long been a source of comfort for many throughout history, including Abraham Lincoln, the English poet Edward Fitzgerald, and the writings of the medieval Persian Sufi poets. It’s a simple phrase, but one worth keeping in mind. No matter how bad

“it” gets, it will eventually pass. The divorce will become final. The house will sell. The children will adapt, and life will go on. This is where that personal fortitude will come in very handy. Decisions regarding the family home are not only emotional, but mired in legal maneuvers and decisions as well. Divorce laws vary based on location, so your licensed legal counsel is your best source of information on how to protect both parties’ interests. Many questions arise when trying to sell your home during a divorce. What needs to be done to ensure a quick and profitable sale? Who will choose the Realtor®? When is the best time to list a home? Who bears the financial responsibilities of the sale? You can proactively allay your fears and clear up misconceptions by doing your due diligence and researching what to expect throughout the selling process. Every divorce has a unique set of circumstances. This book is not intended to be a legal guide or to dispense legal advice, but to provide you with a source of information regarding the sale of your marital real property. Becoming familiar with some real estate terminology and options will give you a better understanding of your situation and confidence that, indeed, “this too shall pass.” The court determines who receives what based upon a variety of factors, such as the relative earning contributions of the spouses. In community property areas, on the other

hand, all income and assets earned or acquired during the marriage are considered to be equally owned. This applies to all debts, no matter who created the liability. In a divorce action, these will be divided equally. In addition, there are mutual court orders that automatically protect marital properties. An automatic temporary restraining order prohibits spouses from selling, transferring, or borrowing against property when a divorce is filed. Again, any orders should be discussed with your attorney, as this protection varies by region. In family law disputes, a court can order the sale of a matrimonial home unless the party who resists the sale can establish a prima facie case that they are entitled to a competing interest in the home under the Family Law Act. Where that party cannot establish this competing interest, the home can be ordered sold. Where that party can demonstrate this competing interest, the motion to order a sale will be dismissed unless the person bringing the motion can demonstrate that the sale would not prejudice the person’s rights. When a home is sold under court order, the court can also order that the proceeds be placed in trust and not be accessible by either party until an agreement is made between the divorcing couple. The family home is typically a couple’s most valuable joint asset and must often be sold in order to equally distribute its

value between the two spouses. Therefore, it is vital for you to understand the relationship and difference between a mortgage deed and a property title. Mortgages are conditional legal agreements made for the purpose of buying a property/home. The lender’s security interest is on record when the title is registered. The mortgagee (lender) may obtain a foreclosure order to take possession if payments of the debt are in default. A property title refers to ownership of that property and the right to use it. A person on the title can transfer ownership to another party but cannot transfer more than he or she owns. Some divorcing couples utilize a quitclaim deed, which transfers ownership from one spouse to another, but it does not transfer financial responsibility. One spouse may transfer title of the home to the other and consider him or her free from the financial responsibility of the mortgage payment, but this is not the case. The loan payments are the responsibility of the parties on the mortgage. In order to change the names on the mortgage, one spouse must obtain financing with which to buy out the other. All discussions regarding mortgages, quitclaim deeds, and title of property should be conducted with your legal adviser. The intent of this book is to provide information regarding the sale of your home within the framework of a divorce; it is not intended to provide legal counsel or advice.

CHAPTER 2 Be Prepared

Step one in successfully handling the disposition of the family home in a divorce is to have a clear understanding of your financial standing. Knowing your precise financial situation throughout the emotional turmoil of divorce will keep you from making snap decisions that could severely impact your financial position. It is crucial to know who bears legal financial responsibility for making the mortgage payments. If both spouses are listed on the mortgage agreement, they are equally obligated to the lender, whether or not their name is listed on the property title. Removing a party from a property title does not relieve the financial obligation of that party. Two signatures on the mortgage means two responsible parties. This also includes the homeowner’s insurance policy. It is important to know who is the beneficiary and if both parties are insured. For the previously stated reasons, it is critical that you collect and immediately provide all information regarding your home insurance, property taxes and liens, mortgage and marital debts, and marital assets to your lawyer. The more prepared you are to face your financial future, the more secure you will be moving forward. Knowing where every dollar has to go will help you make better decisions and avoid adding undue additional stress to the already

uncertain future that accompanies divorce.

Knowing where you stand financially greatly influences your decision to keep, sell, or buy out the family home. There are many considerations for each option and they all require a significant amount of due diligence, financial planning, and difficult decisions. Affordability and objective forethought are the keys to your decision-making process. Poor decisions can affect you and your former spouse long after the divorce is finalized. When divorcing couples have school-age children, they often decide to allow one spouse to remain in the home to avoid disrupting the children’s routine, school attendance, and social relationships. This can be accomplished with written agreements between the spouses. Equitably allocating home expenses and mortgage payments by percentages or mutually agreeing on the delegation of financial responsibility will allow your family to focus on what matters most: the children. A clear-cut, signed agreement drawn up by a mediator will help avoid contention surrounding responsibility for the maintenance, expenses, and future sale of the family home, whether it be to the spouse who remains in residence or an outside buyer. This is why it is important to know your financial position and how much each spouse can contribute. If one spouse fails to make their share of KEEPING THE HOUSE

payments, it can negatively affect both parties’ credit ratings and complicate the later sale of the home. If each spouse has provided appropriate evidence that they have sufficient resources to maintain this type of arrangement and is willing to participate in the agreement, this may be the right path. Some couples choose to reside in the home as roommates for different reasons. It might be that neither spouse is able to afford both their share of the home and a new residence or it could be to decrease the abruptness and difficulty of the children’s transition. If, later, one leaves, that person will have increased financial obligations in finding a new place to live, so give serious thought before choosing this option. Be aware, though, that some spouses are tied to the home, not only by their children, but by their own emotional investment. The house represents stability and a happier time and provides shelter from the trauma of divorce. In keeping it, they may feel more in control of their situation. Some may think that keeping the home makes them the “winner” despite the financial hardship it can bring. It is difficult enough to deal with divorce without later learning that unforeseen or unbudgeted expenses have crept in and taken a big bite of an already tight budget. Be realistic about what is affordable.

SELLING THE HOUSE

For most couples going through a divorce, selling the house is the best solution. Selling a home under any circumstances

takes a great deal of time and effort, so the addition of the emotional stress of divorce can make the task overwhelming.

LEGALITIES

The termination of a marriage requires the division of real property. Marital property belongs to both parties regardless of whose name is on the title, and each party is entitled to their equitable share. Some couples have a legal agreement beforehand, which provides a simple solution to property division. Some couples are able to use mediation to divide assets, but others are unsuccessful in negotiating equitable terms and must turn to the courts to rule on the division of their real property. Again, this book is in no way a substitute for professional legal advice. Always consult your attorney regarding the division of real property. Many couples enter into a mortgage based upon the expectation of a two-salary income that generates enough money to cover the monthly mortgage payment, upkeep, utilities, and unexpected repair. It may be that neither spouse is in a financial position to singularly carry the full financial burden, and may not be in a position to buy out the other. Preventing default on the mortgage is the most common reason divorcing couples choose to sell the family home. Monies budgeted for the upkeep of the home, property taxes, home insurance, home security, and house payments may or may not still be available when couples split.

THE EMOTIONAL SIDE OF SELLING YOUR HOME

If the marital home has been the hub of happiness and family life, it may turn out to be a constant reminder of what it once was and is no more. The good memories the home represents are now tainted by the unhappiness and pain of divorce. No matter how strong sentimental value may be, often the best option is to sell the house and move on. That way, both spouses get some money to make a clean break and start fresh. Once you’ve decided to sell, there is a long “to-do” list, a list that is difficult under the best of circumstances and only made more difficult with the added emotion of divorce. The liability of keeping a home may be the best reason to sell. There are various ways to keep a house with one spouse remaining and the other departing, but they all carry risks and challenges. An equity buyout occurs when one spouse keeps the asset, and, in exchange, compensates the other for his or her share of the equity. LIABILITY

THE BUYOUT

If one spouse is in a financial position to remain in the home, it may be easier to buy out the other’s share of the property, which would entail refinancing the home. The real challenges come in working out the details. There could be disagreement about the selling price or the appraisal value.

Or, the equitable division of the property may not meet expectations. Other questions that arise include the possibility of giving up marital property rights in exchange for other assets like investments. The ex-spouse may lose out on future appreciation of the house. It is crucial to know that questions like these will arise when it comes to the division of property in a buyout situation and that you have to be prepared to address them. Refinancing the home in one spouse’s name means not only settling the previous loan but paying the selling spouse their portion of the buyout. As an example, if the principal balance owed is $100,000 and there’s another $100,000 in equity, one-half of the equity ($50,000) would be due the selling spouse and $100,000 would be required to pay off the principal. The refinanced loan would have to be at least $150,000. If the house value has appreciated, who is entitled to the equity? What if the property is appraised lower than the current loan? All scenarios must be considered before deciding on a buyout. Again, knowing your financial standing before filing for a divorce is paramount. If you or your spouse want to keep the house and buy out the other, but need time before this can be accomplished, co-ownership is a possibility. However, maintaining a clear channel of communication with the ex-spouse is a major part of co-ownership and one of the most difficult to achieve because it requires a lot of mutual trust, something that is typically lacking in most divorce scenarios. CO-OWNERSHIP

The goal is to move forward, so any concessions made between the spouses benefit not only both parties, but especially the kids. Maintaining a civil, business-like relationship in front of your children will help them maintain stability and keep them from moving away from their home when they’re already adjusting to a lot of change. If one of the spouses can occupy the home with the children and make the mortgage payments until they can manage a buyout and become the sole owner, it’s a win-win. The drawback to this type of arrangement is the negative consequences if the spouse in residence defaults on mortgage payments. Both parties are still responsible, and missed payments will affect both spouse’s credit scores. Moving forward with a new life can be tricky in a co- ownership agreement because consistent communication is necessary, and that isn’t always (or even usually) easy for divorced couples. House payments, insurance premiums, utilities, and necessary repairs are guaranteed financial obligations. What if the utilities are shut off due to nonpayment? What if the home heating and air- conditioning system terminally fails? What if you moved two hours away and your ex-wife needs you to help with a fallen tree because she can’t afford to pay someone to dispose of it? What if the resident spouse has to move out because s/he cannot afford to stay? What if the resident ex- spouse files bankruptcy and risks losing the house? These are all very real possibilities.

Co-ownership must be considered carefully, and a

knowledgeable attorney dedicated to protecting your family’s well-being will be your best source for guidance on the complexities that may arise. An agreement can be created to address all the obligations mentioned previously and protect both parties at the same time. No matter the option you choose, the mortgage must still be paid. Selling is the only alternative if neither of the spouses can afford the home on a single income. A short sale is possible if the home is going into foreclosure. You can come to an agreement with your lender to sell the home for less than is owed. Walking away from your home and mortgage is not tolerated by the courts. The lender will add to the complications of your divorce by taking legal action to receive the remaining balance. attitude, which will cost more time and more money. Many divorcing couples end up using up what equity they had in their marital property on legal and court fees. Refusing to sign papers to sell the home or refusing to help pay for the mortgage will give a judge no other option than to order the home sold, on the court’s terms. When a divorce action is filed, an automatic temporary restraining order can be issued to prevent spouses from selling or borrowing against marital property. Discuss this option with your lawyer to make sure your stake in the You can find yourself in court if you or your spouse is uncooperative or is demonstrating an obstructionist

marital property is protected. Less than one-third of divorces end up in court due to disagreements over property division, but if you’re in that unfortunate one- third, going to trial doubles the cost of the divorce. Many divorcing couples who want to limit legal fees as much as possible, as well as the time it takes to settle, choose to sell their home. Surveys show that couples who resolved their property issues without court intervention completed the divorce in under a year. Those who could not agree and went to trial had to wait an average of 15 to 16 months. Some provinces require divorces to be resolved within a year, but dockets are full in many provinces, which causes long wait times for a divorce trial. While you’re waiting for the trial date, the mortgage still has to be paid, as well as utilities, insurance, and property taxes. The upcoming chapters will expand upon the benefits of marital agreements that help sell the home, the importance of having realistic expectations regarding the value of your home, and how choosing a Realtor® who has experience working with divorcing couples may be your greatest asset in the sale of your home.

CHAPTER 3 Marital Settlement Agreement One of the most productive methods for couples to move forward with a divorce, and on with their lives, is to disconnect emotionally and handle the sale of the home in a businesslike manner. Because the marital home is usually the greatest asset in a marriage, it is also the greatest liability. You must give a lot of serious thought to securing settlement terms that protect both parties, especially the spouse who is departing the home. When you enter into your marital settlement agreement, your lawyer should specify who is financially responsible for the mortgage, the homeowners insurance, utilities, and upkeep of the marital home. If the spouse occupying the marital home is responsible for listing, showing, and selling the home, the other spouse may be obligated to pay part or all of the mortgage as well as contribute to the upkeep of the home. If the occupying spouse shows little effort in getting the house sold, the marital agreement should provide a timetable for the sale of the home. It is important for the marital agreement to include provisions outlining the steps to be taken if the house cannot be sold within a specified time or if one spouse fails to meet any financial obligations. Consult your legal adviser for contingencies that are specific to your situation. Additional expenses may include

repainting, landscaping, or replacing appliances or carpeting. There should be clear direction on how to handle the unexpected while in the process of selling the home — for example, if a home inspection reveals a cracked foundation or termite infestation. Ex-spouses sometimes agree to a fixed amount of time to share expenses prior to the sale of the home. Quick decisions can be damaging, especially when it comes to co-ownership or one spouse occupying the home until it sells. By keeping emotions at bay while making important decisions and focusing on what needs to be done to sell your home, you and your ex- spouse can move on faster. Since the home is one of the most valuable marital assets, dividing the property between a couple in the throes of divorce can be a major source of contention. If you have other properties, such as a vacation home or investment properties, those will also have to be assessed and assigned a monetary value. In order to divide equitably, or equally, as the case may be, you will need to know the precise value of your property. When it comes to the marital home, there are several common valuation methods available to determine the value of your home. These are used in property settlements and may differ from what you perceive as your home’s worth. REASONABLE AND REALISTIC EXPECTATIONS

COMPARATIVE MARKET ANALYSIS

Your real estate agent will provide you with a comparative market analysis, or CMA. This is an in-depth review of your home’s worth in the current market based on the recent sale prices of comparable homes. Any differences, such as the size of the lot or value-added items like a swimming pool, are taken into consideration and the value adjusted accordingly. The broker price opinion (BPO) is another type of estimate, produced by a real estate agent in response to a request from a mortgage lender. A few years ago, when real estate sales around the country were at their peak, lenders found it difficult to handle the staggering number of transactions. The BPO concept was born. It is less elaborate, and thus less costly, than an appraisal, but more involved than a CMA. There are two kinds of BPOs, drive-by and interior. If the agent has access to the interior of your home, you will obtain a more in- depth and accurate evaluation. No matter your circumstances, you’ll obviously want top dollar from the sale of your home. Therefore, it is crucial to get a reliable evaluation generated by a Realtor® who will stand by his/her appraisal throughout the sale process. BROKER PRICE OPINION

THE COST APPROACH

The cost approach is based upon what it would cost to reproduce your home new, less depreciation and obsolescence. Would any person buy the property for a cost greater than the value of the land and a structure with equal appeal?

PROFESSIONAL APPRAISAL

A professional appraisal for the valuation of marital property is required when a court is dividing the couple’s assets. Some provinces require a judge to independently determine the fair market value. There are some circumstances in which a judge may consider information provided by a spouse. You should understand that when a valuation is determined, it may not include latent cost-related issues. If there are plumbing problems under the foundation or the structure has been compromised by a termite infestation, these situations will affect the sale price. It is advisable to have a home inspection conducted in an all-encompassing examination of the condition of the home. It will be invaluable in discovering the universal condition of the home. The inspection will cover electrical wiring, plumbing, roofing, insulation, as well as structural features and could uncover issues invisible on the surface. This will give you a realistic idea of what to expect when you sell your home. Most buyers require home inspections to eliminate any questions regarding your home’s integrity.

Typically, a buyer will order and pay for a home inspection. However, doing this yourself in advance offers two advantages: 1. Both spouses are made aware of any underlying problems with the home and arrangements can be made to split the cost of repairs, and 2. Buyers who are interested in the home will have an additional layer of security in knowing the integrity of the home without having to put out the money themselves for the inspection. It may cost you a few thousand dollars upfront, but buyers appreciate having this information available, and that goes a long way toward building a relationship of trust and willingness to do business. Choosing the right listing agent is important. As obvious as this might seem, selecting the best real estate agent for you can be difficult. Most people personally know a real estate agent, but don’t jump headlong into working with friends who 1) may not be experienced at working with couples in the midst of divorce or 2) may not be impartial to both spouses. There are Realtors® who focus specifically on helping people who are going through a divorce. They are known as Real Estate Divorce Specialists. These agents have been trained in legal and tax aspects of divorce that even most divorce 19 FINDING THE RIGHT REALTOR®

lawyers don’t know. If the house is handled improperly during the divorce, the result could be that one or both spouses end up ineligible to qualify for a mortgage for many years. A real estate professional experienced in the divorce niche can provide clients with step-by-step guidance to protect themselves legally and financially. What defines a “good” real estate agent? That often depends on your particular circumstances. For someone selling a home during a divorce, it means finding someone with experience dealing with divorcing couples and who is an expert negotiator — not only between seller and buyer, but between seller and seller, who are not always on the same page or even on speaking terms with each other. Some Realtors® prefer not to take on listings with divorcing couples because the process is often more complex and labor intensive than a standard real estate transaction. Not every real estate agent is equipped to handle the complexity of property issues that come with the division. Most of all, you have to like your agent. You might be spending a lot of time with him or her over the next few months. This has to be a person who is calm, cool, and collected, is sensitive to the circumstances, and can move your home no matter the current market. He or she must relate well with both spouses and cannot show any bias or judgment. You want someone who you feel listens to your priorities, is patient with the situation, and can be trusted to deal fairly and communicate fully with both parties.

The best Realtor® is one who will work effectively with both

parties despite conflicts of interest and strong emotions coming from both sides. An experienced Realtor® won’t run at the first sign of an emotional outburst, shy away from awkward meetings between soon-to-be exes, or hold exclusive meetings with one party over the other, and will instead provide a neutral ground for interactions. Be sure your Realtor® keeps the details of your divorce out of sales conversations, since some buyers equate divorce with “desperate to sell” and will attempt to leverage that information in negotiations to get a lower price. You don’t have to seek out a certified Real Estate Divorce Specialist, but when you look for a Realtor®, don’t be shy about asking questions about their experience working with divorcing couples. You must be able to wholeheartedly trust your Realtor®. Listen to how they talk about previous clients. This is usually an accurate indicator of how you will be treated. Look for discretion and empathy. Most Realtors® work with buyers and sellers who don’t know each other, not with divorcing couples who may or may not be adversarial with one another. The best Realtor® for you will be impartial and understand the complex nature of divorce. Make sure you pick a good listener. No two divorces are alike, and your Realtor® should be able to help sell your home without taking sides. Some Realtors® are trained in mediation. Since you and your spouse will both be involved in the selling process, look for an exceptional communicator who knows how to keep

everyone on the same wavelength. Suitable agents are focused on being objective and are unaffected by emotional outbursts from either party. Not only do you want a Realtor® with divorce experience who is a good listener/communicator, you also want one who is genuinely concerned about your situation. They should show an interest in helping both parties experience a quick and strong rebound in their finances. They should also be knowledgeable about the local market in order to price your home correctly from the start. Listing price to sale price ratio —What is their success rate for sales? Current — Is the agent up-to-date with the latest housing trends so he/she can serve you effectively? Connected — Does the agent belong to a network with the necessary contacts to assist in every phase of the sales? This network should include home inspectors, quality service- people, other brokers, and county officials. Knowledgeable — Is the agent familiar with the current market and able to price your home strategically? Does s/he know the unique features of your neighbourhood to distinguish your home from the competition? Does s/he know what to highlight in your area to attract buyers? Here are some traits to look for when hiring an agent.

Organized — An agent must pay close attention to your specific needs, communicate well, and be quick to follow leads. Personable — An agent who is sincerely interested in helping you will go the extra mile with a smile. They must be able to sell themselves to you as well as sell your home to a buyer. Passionate — Some agents treat their job like a hobby or just a way to earn extra income. Find an agent who is passionate about what they do and loves their job. Tenacious — Successful agents possess a strong work ethic. They are efficient and take advantage of time-saving tools that help sell your home. Self-motivated — Real estate agents are commission-only businesspeople. Successful agents work hard because what benefits their clients benefits them. Creative — Sometimes it takes creativity to properly showcase a home, develop engaging content, and negotiate a sale. An agent who can quickly address any marketing need is an asset to you. Tech-savvy — Agents well-versed in the latest technology for marketing homes should have a website, social media Honest — Professional real estate agents build their reputation on high standards of business practices.

setup, user-friendly home search options, and quality presentations online with high-resolution images of homes, as well as videos and slideshows. A professional Realtor® has to wear many hats. They must be proficient in marketing, negotiation, consultation, the legalities of real estate, property taxes, and, most of all, gaining the trust of their clients. It is to your advantage to hire an agent who understands your unique needs while you work through your divorce. Once you’ve selected your Realtor®, remember not to take out your stress and anger on him or her. He or she has nothing to do with the divorce, and is trying to help you. Take his or her advice. They are the professionals and know more than you do about selling your home. The following chapters are a helpful guide on how to present your home in the best light and how to avoid costly mistakes, especially when it comes to negotiating.

CHAPTER 4 The 80/20 Rule

In 1906 an Italian economist, Vilfredo Pareto, found an intriguing correlation. He noticed 20% of the pea pods in his garden held 80% of the peas. Studying the peas prompted him to take a closer look at this ratio. In one of his initial discoveries, he found 80% of the land in his area was owned by 20% of the people. After a detailed study, he observed this ratio held true in many aspects of life. The Pareto Principle, or the 80/20 rule, is the result of his findings.

For example:

• 80% of your income is derived from 20% of your work. • 80% of a business’s income is derived from 20% of its customers. • 80% of your value to an employer is derived from 20% of your work.

BUYER’S STORY

When Vince and Sue were shopping for a new home, Vince wanted an ocean view. They looked at many desirable properties but didn’t find any that were right for them. Some were overpriced; others had obstructed views. The

search went on for almost a year until they found an older home a short walk from the ocean. The neglected exterior and dated interior were not encouraging, but when Vince stepped out onto the third- floor balcony off the master suite, he was sold. Any shortcomings in wall colour or fixtures faded away when he took in the view. He could now see the sunrise from his bedroom window every morning.

What 20% of the home caught the eyes of Vince and Sue? The magnificent third-floor view of the ocean!

SELLER’S STORY

When Cam and Kate listed their home, they needed a buyer who wasn’t concerned that the house was on an unpaved road. Though the home was over 10 years old, the interior was updated with fresh, neutral wall colours and carpeting to look brand new. The towering trees and established yard gave the home a welcoming appeal. The buyers had also looked at a home within miles of Cam and Kate’s that had towering trees as well as a koi pond and patio. This home was comparable in interior and exterior, but it was on a busy street. What 20% of the home caught the buyer’s eye and prompted him to choose Cam and Kate’s home? The buyer loved the secluded country feel of the home. The 1.8-acre property was surrounded by pastures, with grand oaks dotting the

landscape.

CHAPTER 5 Relating The 80/20 Rule to Home Selling Understanding this concept can save you time and frustration in selling your home. When you use the 80/20 rule, you stop trying to sell people on the entire home. In applying the rule, you can highlight the 20% of your home’s features that make it special. The remaining 80% of your home still affects the buyer’s decision, so you don’t want to neglect it, but you also don’t have to spend a lot of time or money to improve it. Your selling point won’t be the common features your home shares with the other properties on the market. Focus on your home’s unique features to grab the attention of buyers. Spotlight the unique features of your home that set it apart from others on the market. You will attract interested buyers who are willing to pay the asking price. What does your home or property have to offer that other homes in the area do not? Perhaps you have a relaxing patio or lush landscaping that will catch a buyer’s eye — whatever you find, play it up and the house will move. THE 80/20 RULE IN ACTION: BUYERS ARE SEARCHING FOR UNIQUE FEATURES

POTENTIAL UNIQUE FEATURES

Spotlight the unique features of your home that set it apart from others on the market. You will attract interested buyers who are willing to pay the asking price. • Hilltop views. A high vantage point that comes with a spectacular view of the surrounding area. • Wildlife. Many enjoy the beauty of being one with nature by watching birds, deer, and butterflies from their back porch. • Majestic views of sunrise/sunset. There is nothing more awe-inspiring than bearing witness to the beauty and stillness of the colours of twilight and sunset from your own back yard. • A beautiful patio. Outdoor living is important to most buyers. A good-sized patio big enough to host a summer party might be just what your buyer is seeking. • Location, location, location. Emphasize the safety, convenience, and future of your home’s location. Today’s buyers want great schools, easy commutes, and local amenities. Some will pay extra for a home based upon its location in the complex, especially if it has a yard area. A buyer once paid extra for a townhouse simply because of its location in the complex. Most of the surrounding homes did not have yards, but a few shared a half-acre “yard area.”

An owner whose townhouse bordered this yard area was

able to sell his home for a higher price than other townhouses on the market. His home had a characteristic shared by fewer than 10% of the others. He had the only available listing offering that feature. With this attractive point of difference, the house sold for a higher price. Another townhouse seller in the same complex found a different unique feature. Although he did not have a yard, he was still able to use his location to his advantage. His property backed up to a lake and fountain. This unique feature helped him sell his townhouse quickly and for a great price. • A private location. Homes that sit far back on the lot, next to an empty lot, or partially concealed by trees appeal to buyers who want to unwind away from the sight and sound of neighbours and street noise. • A big, shady backyard. If you have a larger backyard than your neighbours do, use that to your advantage. People like to have extra room for kids, pets, and entertaining with lots of trees for shade. • A fenced in backyard. People with kids and pets flock to homes with fenced in backyards. • Additional unique attributes. You can also market a finished basement, large attic, an extra-large garage, swimming pool, hot tub, or anything else that makes your home stand out.

CAPITALIZING ON THE 20% DIFFERENCE AND MARKETING YOUR HOUSE'S BEST FEATURES

Follow the 80/20 rule and you will stop wasting time showing your home to people who are not interested. Instead, you will be showing your home to buyers who are motivated to make a purchase. You won’t have to show so often and you won’t have to sift through lowball offers from casual shoppers. Take the time to uncover your home’s most attractive and unique features and make sure they shine. Compare your house with others in the neighbourhood to see what makes yours stand out. If it’s a backyard pool, make sure it sparkles. If it’s a veranda- style porch, clean off the grime and make sure it overlooks a well-manicured back yard. If you have a garden, work it every day to make sure it is the most beautiful on the block. Every house has potential. It just takes a little creativity and elbow grease to get the unique features to stand out and draw the attention the 80/20 rule demands.

CHAPTER 6 Creating Curb Appeal Curb Appeal —The attractiveness of a property for sale and its surroundings when viewed from the street. Whether viewing an online photo or driving by your home, a home shopper will decide in a matter of seconds whether or not they want to see more. First impressions are powerful, and, as they say, you don’t ever get a second chance to make a first impression, so creating curb appeal is crucial to generating interest in your home. Curb appeal is so powerful a selling tool that your well-prepared house may even catch the attention of buyers who weren’t attracted by the written description of your home. homes appeal to you. Homes with clean yards and groomed lawns will be more impressive than homes with cracked paint, loose shutters, uncut grass, and weed overgrowth. The outside appearance of your property should serve as an invitation to come inside. Potential home buyers are drawn to welcoming entries and uncluttered yards. Would you be attracted to a home with dead shrubbery and a weather- worn exterior? You may assume that the home is neglected on the inside as well as the outside. Herein lies the importance of curb appeal. Conduct an experiment. Take a drive around your neighbourhood and the surrounding area to see what

When you drive up to your home, take an objective look and inventory the things that need attention. With simple improvements like weeding, trimming, and window washing, you can improve the appearance of your home in an afternoon. Low-cost investments like power-washing the house and concrete, repainting trim, and adding landscaping also add to your home’s curb appeal. The goal here is to get more money for your home. Homebuyers generally aren’t interested in a property that needs work unless you don’t mind selling it below market value. If you have poor landscaping, dingy exterior paint, or an unkempt yard, they may drive right on by without giving the interior of your home a second thought. • Are your shrubs, trees, flower gardens, and walkways tidy? • Is there trash or a general mess in your yard? • Does everything (front light, garage door, porch rails, etc.) function properly and look its best? • Could outdoor features, like patio furniture or the deck, be cleaned or updated with a coat of paint? Make the necessary improvements to update the exterior of your property, and you will benefit from the many people who are drawn to the inside of your home when they see how beautiful it is from the curb! Look around your yard and list everything that needs work.

You may find yourself with a long list of things to do; it takes hard work to get a home ready to sell. Anyone can put a house on the market, but not everyone can sell that house quickly or make the profit they want and/or need. Follow these guidelines to improve your chances of selling your home quickly for the best price. • Cut the grass. Give your lawn a clean, close cut and manicure the edges of sidewalks and driveways. Obliterate stubborn weeds along pathways, the house, and around trees. Repair, seed, or use groundcover to detract from bald patches in the yard. You can also use a commercial turf dye aerosol paint colourant to cover dead spots caused by pet urine. • Trim the hedges. If there is one thing that makes a home look like an abandoned hideout, it’s a runaway row of hedges. Make sure that hedges are nice and even. • Colourful landscaping. Plant a variety of colourful flowers, and spread pine, straw, or cedar chips. It’s a great idea to include a night photo for effect, so consider adding some LED path lights. • Give it a bath. Wash the windows, power wash the house, driveway, and pathways, and clean the gutters. Keep the pathways and driveway swept. Invite buyers by showing that the home is well maintained. Don’t forget to lower the garage doors and wash those windows, too!

CREATE A GRAND ENTRANCE

Impressing the home shopper at the front door is as important as the curb appeal. This means more than putting out a welcome mat or potted plants. You want them to feel safe and secure when they open the door. The doorknob is the first touch point of your home. If the entry handset is worn or loose, replace the door handle with a heavy-duty deadbolt and knob combination. This wise investment of less than $50 will make your home more visually impressive. A flimsy lock or handle on your front door will make potential home buyers feel uncomfortable, and they may not even know why. Security is important to homebuyers. The front door itself is a focal point, so make it impressive, too. Is the paint on your metal door faded? Is it peeled and flaking? Freshen it up and add a dash of colour. Choose a paint that complements the colour of your home. Replacing a wooden door with a steel entry door is worth the cost with an average 91% return on investment (ROI). You can also replace brass kick plates fairly inexpensively, which adds a newness to the appearance.

OTHER THINGS TO CONSIDER TO CREATE GREAT CURB APPEAL:

• Symmetry appeals to the eye, and is easy to accomplish. Lopsided landscaping or unevenly

trimmed bushes will detract from curb appeal. The overall appearance of your home should be balanced. • Invest in a new mailbox. Make sure it complements your home. • Outdoor lighting is not only a great way to addbeauty to your landscape, but is perceived as a safety measure. You can purchase attractive yet inexpensive solar lamps that soak up the sun all day and glow all night. No wires or cords necessary! • Add instant colour by using flower boxes and raised flower beds. They are an easy, inexpensive way to enhance the exterior appearance of your home. • Spruce up the landscaping surrounding your home. Eliminate weeds and add fresh mulch to make a difference and show shoppers you care about the overall look of your home. • • Give your home architectural appeal by adding molding to the tops and sides of the doorway or around windows. • Shutters and trim need to be in excellent shape. Repainting them adds to the home’s attractiveness. Your fence gates, arbors, or fencing panels need to be clean and fresh as well. • Clean downspouts and gutters. Repaint or touch up to eliminate rust spots. You don’t want your home to appear neglected. If they can’t be repaired, replace them. It will add to the ROI in your sale price. • Make sure the walkway to your front door is easy to approach. Don’t let stacked hoses or unruly landscaping interfere with home shoppers entering your home.

• If your railings look weathered, consider a fresh coat of stain or paint. • Faded or chipping paint, siding, or trim will always detract from curb appeal. Giving your home a fresh coat of paint is recommended. If your exterior paint is in good condition, make sure your doors and window trim are, too. It is well worth the cost of this upgrade because it will add to the overall look and feel of your home. • Power washing the house, walkways, and driveway can be almost as effective as repainting, and at a much lower cost. You can rent power washers from your local hardware store, or if you’re not able to do it yourself, most house painters offer pressure washing as a side service. • Adding some stone or stone veneer to the face of your home is an inexpensive way to instantly update your home if it complements the design. • Add a “smart” doorbell. Eight of ten home doorbells are outdated or not working, so if you invest $200 in a doorbell equipped with a camera and speaker, you will impress home shoppers who are looking for security measures. Curb appeal is one of the most important elements in selling your home quickly and successfully. You can create interest in your home before buyers even step out of the car, no matter how uninterested they might have been initially; after that, though, it’s up to the interior of your house to carry that impression.

The upcoming chapters will lead you through the interior staging of your home and understanding the power of photography in marketing your home. Know where to spend and where to save. The investment of your time and energy to update can improve the way your home is appraised, viewed, and valued.

CHAPTER 7 Staging with Purpose

According to Wikipedia, home staging, or “real estate enhancement” is “the act of preparing a private residence for sale in the real estate marketplace. The goal of staging is to make a home appealing to the highest number of potential buyers, thereby selling a property more swiftly and for more money.” This strategy is effective in any market. No matter what type of home property is being listed, this approach works. It applies equally to single-family houses, apartments, townhouses, and condos. Agents and sellers using this tactic have a greater chance of selling the property for more money. Home staging does take extra time and work, but the payoff is well worth the effort. Staging is one of the most effective marketing tools to sell homes for more money. In today’s competitive real estate market, selling your home requires hard work and dedication. If you are a motivated seller, this is where you can bring your home to the marketing forefront. Creating an appealing, eye-catching home via strategic staging helps potential buyers envision themselves living in the home and has come to be known as the best investment of your time and effort when selling a home.

THE POWER OF STAGING A HOME:

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