MY PROVEN SYSTEM FOR SELLING HOMES
Published by Authorify Publishing Copyright © 2020 Authorify Publishing
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
First Steps To Home Selling
Creating Curb Appeal
Staging With Purpose
Upgrading With ROI In Mind
The Three D's
How To Market Your Home
Common Seller Mistakes
10. Learn From Other's Mistakes
11. Finding Buyers
12. Be A Power Negotiator
13. The Dos And Don'ts Of Negotiating
14. Bargaining Chips
15. Why Hire An Agent
Foreword When I first ventured into the real estate industry, I did so with the hopes of helping sellers avoid the pitfalls often associated with the home-selling process. In my years of experience, not only have I helped alleviate the stress of selling for clients, but I’ve also accumulated knowledge to help them get more money for their homes in the least amount of time. I decided to share my expertise in one place, which is 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 mistakes most commonly associated with the home-selling process. This book is my gift to you. It contains insider advice on the home-selling process to help achieve your ultimate real estate goal, including:
• 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 you read my book and still have questions or need more explanation, I am happy to help. If you decide to hire me to sell your home, we'll schedule a meeting either in-person or online and set up a specific plan.
Gina Newell Premiere Stagers & Realty 608-345-9396 firstname.lastname@example.org
About Gina Newell I was born and raised in Madison, WI and graduated from East High School. I earned Bachelor of Science (Microbiology) and Master of Science (Curriculum & Instruction -Science Education) degrees from the University of Wisconsin-Madison. I also earned a graduate certificate in School Business Management from the University of Wisconsin-Whitewater. I worked as a lab technician, a high school science educator, and then a business manager for a residential remodeling company. I started a home staging business in 2008 and earned my real estate license in 2010. I can visualize what a room should look like and know when it feels right and why. I am detailed oriented and will do my best to get everything right. I love helping people buy or sell homes. There are a lot of details, variables, and expectations to meet and exceed. My staging services are included with my listings. It's a winning combination since staged homes sell faster and for more money than unstaged homes. My niche is helping sellers get the most from their homes. I recommend small fixes or updates that give the best return on investment (ROI). See my portfolio at: https://www.houzz.com/ pro/premierehomestagers/premiere-stagers-realty • Certified Home Stager • Certified Color Expert • Pro-Stager Designation • Licensed Wisconsin Realtor with eXp Realty, LLC • Accredited Buyer Representative (ABR) • Pricing Strategy Advisor (PSA) • Madison College Lecturer on "Staging your House to Sell" ix My credentials:
Whether you are buying or selling, my goal is to guide you through the real estate process as smoothly and professionally as possible. I look forward to working with you. [Disclaimer: I am not an attorney and do not presume to give any legal advice within this book.]
CHAPTER 1 Introduction
The largest investment most people make is their home. That makes selling a home — whether a single-family residence, duplex, or condominium — the single largest, most complex transaction a person will ever undertake. It involves new terms and concepts, financial acumen, and larger figures than normally dealt with. It is also one in which emotions may come into play to the detriment of good judgment. Surely, the seller thinks, my home where I raised my children and made so many memories is worth more than the bricks and mortar it contains. Real estate transactions involve dozens of decisions and substantial investment in homeowners’ time, energy, and money, and emotions almost always lead to problems in a sales price negotiation. The home seller’s objective is to find that buyer who cannot resist buying your house at the highest price. To do this, you need to offer potential buyers a striking home sales presentation that outshines other homes on the market. It requires making a fantastic first impression, an instant feeling they are walking to the door of their new home for the first time. It’s about falling in love at first sight, from the curb, in those initial fleeting seconds. Most sellers do not venture alone into selling their home. They find it better to have an experienced real estate professional with whom the owners are comfortable. This book was written to provide some of that comfort without the direct sales stressors of person-to-person contact.
I also want the prospective or active home seller to independently achieve a better understanding of the home-selling process. I’ve provided actionable insight into how best to market your home, avoid critical mistakes, and maintain a proper focus. Let this book be your go-to resource for information, strategies, and techniques that can be put to work to sell your home quickly at the best price. Take time to look through the chapters and master the secrets of successful home sellers. Discover why comparable homes sell for considerably different prices. Be ready to sell by knowing your home’s market value, best listing price, how to negotiate, and what improvements have the best Return on Investment (ROI). My sincere hope is that this book will help you make the most of your time and efforts to sell your home. In Part 1, the process and importance of preparing your house for sale is examined: how to present to get top offers, the “80/20 rule,” along with which upgrades will make the most difference in ROI. Part 2 delves into marketing your home with a look at costly mistakes, avoiding those mistakes, and finding qualified buyers. In Part 3, we examine the critical topic of negotiations — what to expect, and how to conduct them — and finish with a look at what engaging a real estate professional brings to your real estate sale transaction. After you learn the process, requirements, and tips, you will see that an experienced, financially-astute real estate professional can vastly cut the time and raise the economic value of your transaction. Reading this book is your first step to selling your home for the best price in the shortest time. After you read it, you might want to talk with me. I stand by to assist you with a Comparative Market Analysis and a solid marketing plan to fit your needs and lifestyle.
CHAPTER 2 First Steps To Home Selling
“But You Gotta Know the Territory” — and Terminology
Location! Location! Location! is the most crucial consideration in real estate and a major factor, if not the predominant one, in real estate pricing. Novice (and not-so-novice) home sellers alike must know the considerations — such as location — that determine a home’s price. Setting the price at which to sell your home is not a simple formula, nor mathematical. Many elements factor into the decision. Throughout this book, you will read examples of similar and similarly situated houses that sold for very different prices, along with the reasons for the disparities. A calculated home value is not necessarily what you believe your home is worth. Recognizing this helps avoid overpricing, a major factor that leaves homes languishing or unsold. Familiarity with the real estate terms market value, appraisal value, and assessed value can save disappointment and frustration, and allow the home seller to more meaningfully engage in setting a home’s listing price. The most-used definition of market value is “the most probable price a property should bring in a competitive, open market under conditions requisite to a fair sale.” Essentially, this is a pre- negotiation opinion of what a house should bring in its local market, i.e., its geographical area, generally an area such as a suburb or neighborhood.
Appraisal value is an evaluation of a property’s worth at a given point in time that is performed by a professional appraiser. Appraised value is a crucial factor in loan underwriting and determines how much money may be borrowed and under what terms. For example, the Loan to Value (LTV) ratio is based on the appraised value. Where LTV is greater than 80%, the lender generally will require the borrower to buy mortgage insurance. Assessed value is the amount local or state government has designated for specific property and frequently differs from market value or appraisal value. This assessed value is used as the basis of property tax and when a property tax is levied. The assessed value of real property is not necessarily equal to the property’s market value. Approximately 60% of U.S. properties are assessed higher than their current value; however, this does not reflect the home’s value.
WHAT IS YOUR HOME WORTH?
The first step in selling your home is knowing the difference between value, worth, and price. Let’s examine the determining factors at work. Understanding those factors allows them to be leveraged. There are several ways a home’s value is derived.
ONLINE HOME VALUATION
Online tools will provide you with a very basic estimate of your home’s current value based on recent comparable home sales in your area using a comprehensive database. Note that the assessment is based on available data with no guarantee of accuracy and often uses an algorithm that simply averages comparable sales in the geographic area. These tools might be quick and easy, but they don’t take into consideration factors like location, current local trends and the condition of the property. Be aware that the prices arrived upon might be highly inaccurate.
For example, a home in Ohio was put into one such system, Redfin's Home Worth calculator. The home last sold for $180,000 in 1998; it was appraised for refinancing in 2015 at $275,000. In 2017, Redfin’s calculator valued this 1890 Victorian home (4 bedrooms, 1.5 baths, and 2,100 square feet) in a four-block area of “Grand Old Ladies” at $158,000. The apparent reason is that the six “comps” (comparable recent sales) included only 2 homes in this desirable neighborhood (over $300,000), while four others outside this small neighborhood, although close, sold for $150,000 to $199,000. Because the system doesn’t understand the makeup of the area and simply pulled prices from a broader geographic area, the arrived-upon price was far below what it should have been. These tools are worthwhile for obtaining “comps” of area sales; however, they are not highly accurate in arriving at a listing price.
EXAMPLE OF DIFFERING HOME VALUATIONS
Say a buyer is interested in a home listed at $420,000. The online valuation determines the house is worth $440,000. Based on that estimate, the buyer offers the asking price. When a professional appraisal comes in at $400,000, and the existing tax records assess the home at $300,000, the buyer wonders why the values are so different and whether he overpaid. The house was listed at $420,000 because at that price, the home would sell in a reasonable amount of time. Why would the appraised value not be whatever a buyer was willing to pay? The fact that they paid $420,000 does not mean that is the true value of the home. Certain factors may weigh in — undesirable businesses located near the property, for example. Online valuations cannot take into consideration the condition of the property or the qualities of the neighborhood. Since an assessed home value is for taxing purposes only, it can be much more or much less than the market value. Ideally, they should be close, but usually they are not; it is based on a
percentage of the assessed value determined by a professional. From legal descriptions to onsite inspections to comparable home-selling prices, the assessor will take all these things into consideration when assessing a home. Location near industry, high traffic, or potential development will also affect the appraisal.
Nothing determines the sale price of a piece of real estate but the price at which it sells. Houses are not same-priced identical cans of tuna on the grocery store shelf or shares of stock valued and traded every day on the stock exchange. A real estate appraisal (“property valuation”) is the process of developing a perspective of value for real property. This is the market value — i.e., what a willing reasonable buyer would pay for the property to a willing reasonable seller. Real estate lenders generally require an appraisal because every real property is unique in features and characteristics. An appraisal helps in various decision points. The seller can use the appraisal as a basis for pricing. The buyer can use it as a gauge on which to base an offer. Lenders use appraisals to know how much money to credit to their borrowers.
The important factors in a house appraisal are:
• Dwelling type (e.g., one-story, two-story, split-level, factory-built) • Features (including design) — materials used and the kind of structure present and how they were built • Improvements made • Comparable sales • Location — type of neighborhood, zoning areas, proximity to other establishments 7
• Age of property • Size • Depreciation
Condition, of course, is a crucial factor in valuation. Location is also a factor; however, as property cannot change location, upgrades or improvements to a residential property often can enhance its value. A professional appraiser should be a qualified, disinterested specialist in real estate appraisals, with expertise in your region. His or her job is to determine an estimated value by inspecting the property, reviewing the initial purchase price, and weighing it against recent sales with the same purchase price.
COMPARATIVE MARKET ANALYSIS BY A REAL ESTATE PROFESSIONAL
A comparative market analysis (CMA) home valuation is free from real estate professionals and more helpful than automated online offerings. It provides detailed information on each house sold in your area over the last six months, along with the final sale price. It also includes the specifics of all the houses for sale in your area, including the asking price. These homes are your competition. The real estate professional will also answer any questions and help you price your home realistically. Along with an understanding of how the worth of a home is determined, the current market must be considered. By utilizing a professional real estate agent, you can rely on proven expertise to market your home at the best listing price. I am happy to provide you with a Comparative Market Analysis.
THE SECOND STEP
(SELLING YOUR HOME FOR MORE)
There is no calculable certainty in setting the value of a home. There can be wide differences between the seller’s assessed price, or list price (market value), and the price at which the home sells (sale price). Let’s turn to what the homeowner/seller can do to elicit offers at the list price, or even above, in a competitive market. The seller’s time, effort, and investment are the most important parts of the process. The seller’s willingness to adequately prepare the home for presentation by improving, freshening, staging, landscaping, and generally making the home pristine — and to live in that presentation-readiness state for the time it takes to sell the property — will greatly affect both the sale period as well as the price at which the home sells. A market in which homes normally sell in no more than six months of listing is considered balanced or neutral, which means a good number of homeowners are selling and buyers are purchasing; therefore, neither has an upper hand. A variable, for instance, like a major company entering — or moving from — the area will tip the scale either toward homeowners to make a swift market or toward buyers to make a slow market. The typical selling time in a swift market might be 30 days, while that of a slow market may be up to nine months. Typically, any number below six months is considered a seller’s market.
LIVING IN A FISHBOWL
A house on the market requires the home be kept in constant “show-ready” condition, and adjustments to your day-to-day life are inherent. You will get after-hours phone calls from unrepresented prospects and agents to show the home (or list your home) as well as requests for updates on availability.
When your home first hits the market, there will probably be
a frenzy of activity--if your home is presented well online and priced fairly. You will receive texts, emails, and calls for showing appointment scheduling messages, repair appointments, and inspections.
CHILDREN (AND PETS) SHOULD BE UNSEEN, UNHEARD
Children and pets are distractions for potential buyers, affecting their experience of your home. You should plan for your children to be elsewhere and your pets crated or leashed, with no toys lying about or dog hair on the sofa. The dishes should be put away and the kitchen sparklingly clean. The pressure of showing to everyone even mildly interested in looking (not necessarily buying) may come from the idea that the more your home is seen, the more quickly and easily your home will sell. Many real estate agents show their clients dozens of homes to consider without a clear picture of what the buyer wants. Low-interest traffic can be heavy and a burden on the seller’s time, energy, and resources. Since a showing can take 30 minutes to an hour, finding an interested buyer is what matters most. The home will be shown to many more uninterested parties than to interested buyers. How many times will you have to show your home? In an ideal world, your property would be shown to serious buyers only. However, many “Sunday afternoon window shoppers” exist in the real estate business. You shouldn’t waste your time trying to appeal to uninterested buyers. This is where planning, organizing, and the professional help of a qualified real estate agent enables you to handle even the most intimidating tasks without wasting efforts.
CHAPTER 3 Pareto's Principle
“Eighty percent of results will come from just twenty percent of the action.” This is the Pareto principle, attributed to Italian economist and philosopher Vilfredo Pareto, who in 1906 observed an intriguing correlation. He began thinking on the “80/20 rule” with the observation that 20% of the pea plants in his garden generated 80% of the healthy pea pods. This observation caused him to explore other uneven distributions. He discovered 80% of the land in Italy was owned by just 20% of the population. He investigated different industries and found that 80% of production typically came from just 20% of the companies. The generalization became the concept that 80% of results will come from 20% of the action. While it does not always come to be an exact 80/20 ratio, this imbalance is often seen in various business cases: • 20% of sales reps generate 80% of total sales • 20% of customers account for 80% of total profits • 20% of the most reported software bugs cause 80% of software crashes • 20% of patients account for 80% of healthcare spending
RELATING THE 80/20 RULE TO HOME SELLING
Understanding the 80/20 rule concept can save you time in selling your home. Applying the 80/20 rule, you can stop trying to sell people on your entire home. Applying the rule, you highlight 20% of your home’s best features or on things that make it special such as a stunning view. The remaining 80% of your home still affects 12
the buyer’s decision, so don't neglect these as well. However, in photographs and showings, showcase the special features. Meaning, there is no need to upload 35 MLS photos, when 15-18 will do. Your selling point won’t be the common features your home shares with the other properties on the market. Instead, use your home’s unique features to grab the attention of buyers who are interested in those distinctive features.
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 color 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!
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 colors and carpeting to look brand new. The towering trees and established yard gave the home a welcoming appeal.
Their ultimate buyers had previously looked at a home within a few 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.
Another buyer paid extra for a townhouse because of its location in the complex overlooking woods instead of the parking area. Another seller took advantage of the fact that most of the surrounding homes didn’t have yards; only a few shared a half- acre grassy area. An owner whose townhouse bordered this yard area sold his home for a higher price than other townhouses in the complex on the market because his had a characteristic shared by fewer than 10% of others. He had the only available listing offering that feature. He pointed to that feature in marketing the townhome. 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 she did not have a yard, she was still able to use location to advantage. Her property backed up to a lake and fountain. This unique feature helped her to sell the townhouse quickly and for a better-than-average sales price.
THE 80/20 RULE IN ACTION: BUYERS ARE SEARCHING FOR UNIQUE FEATURES
Decide upon, then improve (if necessary) and spotlight the unique features of your home in your marketing copy, online and print
photographs, and in-person showings. Do not spend much time explaining how the storage room can be converted to another full bath. Instead, lead the dog-owning prospect to the fenced-off dog run in the unusually large backyard. If the home has a certain feature a buyer is specifically looking for, highlighting this aspect in marketing efforts will attract interested buyers willing to pay the asking price. Each house will have its unique features. Here are some suggestions if you aren’t sure of yours: • Hilltop view, a high vantage point, or lake view • An open field, woods, or pond frequented by wildlife • Unobstructed views of the sunrise and/or sunset • A patio, deck, screened porch, garden, or gazebo • Highlight items neighboring houses don’t have • Location, even in the same area, adds value if on a cul-de- sac or corner lot • A private location or a lot partially concealed by trees • A unique, shady, or large backyard; a fenced backyard (if allowed) • A finished basement, large attic or 3+garage
LOOK FOR THE 20% DIFFERENCE AND MARKET THE FEATURE
Following the 80/20 rule can lessen showing time to people who aren’t interested. Instead, you will be showing your home to buyers who are motivated to make a purchase. You won’t have to show as frequently. You also won’t have to sift through low-ball offers from casual shoppers. Keeping this in mind, you must take the time to uncover your home’s most attractive and unique features and improve them to their highest 15
potential. Compare your house with others in the neighborhood to see what makes yours stand out. Work with that.
HOW THE 80/20 RULE APPLIES TO HOME SALES
An out-of-town home shopper with no specific requirements contacted a real estate agent to look at available homes for sale. After viewing some properties online, the agent drove him from house to house. The buyer thought each property was priced too high. IF he wrote an offer, it would be 10% to 20% below the asking price. As the day progressed, the agent’s chances of finding a suitable home were dwindling. They stopped at the last house on their list just as the sun was setting. The exterior of the house was dated and the yard untended. The agent and her client had spent the entire day looking at houses that shared 80% of the same features. Nevertheless, once the buyer walked into the room, he wanted to buy the home for the asking price. What set this house apart from the others? He wasn’t too interested in the kitchen, bathrooms, and bedrooms. A bedroom was a bedroom as far as he was concerned. He fell in love with the one remarkable feature of this otherwise uninspiring house. The house sat on a hill with a beautiful view out a large window. As they entered the great room, the sun was setting below the distant tree line. That view sold the buyer. The remaining parts of the home could be improved. The home buyer based his decision to buy on the window view from the hillside. The 20% of the home’s features motivated him to offer full price on the spot. Such is the power of the 80/20 rule.
In some cases, the 80/20 rule may help people make a sale without
even conducting a showing. The house in the next example was a brand-new, custom-built home. It sat on the market for over seven months without a single offer. The builder hired a real estate agent who knew the importance of finding that one special feature. He drove out to give the house a thorough investigation. He discovered what the property had that the competition did not----a five-acre yard. Other houses being sold in the area had one- to two-acre lots. Not only was the yard bigger, but it was also more private than the other properties. The real estate agent marketed the property highlighting the five acres along with a description of the house. Because the house was no longer the main selling point, interest in the property increased.
CHAPTER 4 Creating Curb Appeal
Someone said, “a stunning first impression is not the same as love at first sight." But surely it is an invitation to consider. This could not be truer than in selling a home. First impressions matter. Sometimes they are everything. Nothing sets the tone of a relationship (or transaction) more than a first impression, whether good or bad. So, consider what potential homebuyers may think as they drive up to your property for the first time. You do not have a lot of time to establish a curb appeal relationship with a prospective homebuyer. Whether cruising the web to view online photos from across the country or cruising by a home in the family SUV on a Sunday afternoon, home shoppers will decide at a glance whether they want to see more. “We buy ugly houses” is a sign seen stapled to utility poles. Rehabbers (flippers) look for ugly houses so they can pay the least amount possible. Don't let your house look "ugly" to a flipper. Small and inexpensive improvements can make a big difference. Creating curb appeal is essential to attracting interest in your home. How your home looks from the road is so persuasive that a well-prepared house may catch the attention of buyers who did not find the written description particularly compelling. A house that looks neglected may detour a buyer previously interested by the online marketing to cruise on by. Go around your block and compare your home to others. Is it appealing, pristine, and well-kept? Or are there necessary repairs
you have been putting off? Look at your home as a prospect would. Again, simple improvements can improve the appearance of a home with little to no expense. Check out your landscaping. Make a list of what needs to be tended to: • Shrubs trimmed, flower gardens tended, and walkways tidy; beds weeded, new mulch added • No trash, trash cans, lawn clippings, fallen branches, dead leaves, or general mess in the yard • All outside fixtures and components are working and in good repair • Outdoor features such as patio furniture or a deck should be updated with staining or painting The outside appearance of a property needs to be an invitation to come inside. Potential homebuyers are drawn to welcoming entries and uncluttered yards. They are unlikely to be attracted to a home with dead shrubbery and a weather-worn exterior. It is no stretch to think a buyer will believe the home is neglected on the inside as well. Low-cost investments like power washing, repainting trim, and adding fresh landscaping mulch, give your house more curb appeal. Your goal should be to get more money for your home, otherwise you're leaving money on the table. Homebuyers generally aren’t interested in a home that needs work unless you want to sell below market value. You might need to update the exterior of your property, especially if there are safety or code issues, i.e., stair railing. After you’ve lived in a house for a long while, you’re not likely to examine it objectively. Listen to suggestions from real estate 19
experts, your neighbors, friends, and/or potential home buyers if you're not sure how to make your house show better. Take a drive around the surrounding area to check out any homes that are for sale. Do any of them appeal to you? Note why. Well- tended houses with trimmed bushes, groomed lawns, attractive landscaping, and a nice front door will be more impressive than homes with an unkempt walkway, uncut grass, and a paint-peeling front door. It takes hard work to get a home ready to sell. Anyone can put a house on the market, but not everyone sells quickly or with good profit. After your hard work, prospective buyers will be drawn to the inside of your home when they see how beautiful the outside is. It will be worth it!
CREATE A GRAND ENTRANCE
An important part of curb appeal is the home’s “grand entrance” — the portal to even the most modest house. You want to create a sense in the buyer's mind that this is a great place to come home to. Impressing a guest at the front door is a vital part of the home sale. It is more than putting out a welcome mat and potted plants. You want prospective buyers to feel welcome, safe, and secure when they open the door. The doorknob is the first point-of-touch on a home. A flimsy lock or handle on the front door would make anyone feel uncomfortable. Security is super important! Make sure there is a heavy-duty deadbolt and turn-knob pair. An attractive steel entry door is well worth the cost. You may wish to install security cameras for extra security and peace of mind. The front door is a focal point, so make it impressive. Clean any door sidelites. Paint the door a contrasting color that
complements the siding. Hanging a wreath is welcoming.
SOME OTHER CONSIDERATIONS IN CREATING GREAT CURB APPEAL:
• Symmetry appeals to the eye and is easy to accomplish. The overall appearance of the home needs balance. • The mailbox should look attractive. A curb mailbox should be large enough to hold small boxes or magazines. Be sure the address is adhered to it. • Use outdoor lighting to highlight landscaping as well as for safety. • Use flower boxes, flower pots, or raised flower beds to add instant color. • Perhaps architectural molding might enhance doors or windows. • Keep shutters and house trim in excellent shape. Fence gates, arbors, or fence panels should be clean and fresh. • Clean downspouts and gutters. Repaint or touch up to eliminate rust spots. • Ensure the walkway to the front door is clear and approachable. • Paint or stain railings (if weathered). Curb appeal is one of the most essential 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. If you put money into cleaning up the outside of your home, buyers will be more likely to want to see the inside. Your home’s curb appeal draws buyers in, maintains their interest, and sets 21
your home apart from the competition.
Remember that unless you are willing to lower your home’s price well below market value, prospective homebuyers typically won’t want to take on a major renovation project.
CHAPTER 5 Staging with Purpose
Staging is the art of making your house attractive to the next owner. Creating an eye-appealing home — one that potential buyers can envision themselves living in — is the best investment for a faster and more profitable sale. Sellers often fail to take full advantage in this regard, as it takes considerable time and work. However, the payoff is proven. Staging is considered one of the most effective marketing strategies to increase the value of your home. This strategy is effective in any market and in any type of home property being listed. It applies equally to single-family houses, apartments, townhouses, and condos. This approach works! In today’s competitive real estate market, selling your home requires hard work and dedication. A motivated seller can bring the home to the marketing forefront.
Staging the home will:
• Distinguish it from the competition • Attract top dollar from homebuyers • Lessen the time on the market • Provide a visual edge over the competition • Provide size and scale of a room • Help the buyer make an emotional connection
STAGING VS. NON-STAGED
CASE STUDY & REPORT
I wanted to give you the most convincing proof possible. Many people find it hard to believe that the simple act of staging helps one home sell for more than another, similar home. In my research, I looked for examples of similar houses being sold for differing amounts of money where only one of the two houses was staged. The clearest example I could find was in the case of these two listings. This development has 200 equivalent townhouses. Every single townhome in the neighborhood is three stories with three bedrooms and three bathrooms. Every unit has the same floor plan. I looked for two sales there, and found these: • Townhome A sold on August 26. • Townhome B (5 doors down) sold on July 26, for $40,000 less. I visited this neighborhood, and am familiar with these properties. You could not find a better example of two identical properties that sold for different prices. The details show these two homes are identical in every substantial way: Each unit's lots are identical as far as the desirableness of the location. Both units had the same kitchen plan with the same cabinets and a tile floor. Both units had nice hardwood floors in the living room and carpeted bedrooms. There were two reasons one home sold for $40,000 more than the other:
• Townhome A was professionally staged, giving it a more appealing appearance. • The agent selling Townhome A took higher quality, more attractive photos of the home. Those two seemingly small actions made the $40,000 difference! The buyers of Townhome A made a higher offer because the agent presented the home in a more appealing and attractive way. *B Curry, Realtor. (Used with the permission of the author)
THE POWER OF STAGING WHEN SELLING A HOME
Consider these results from surveys conducted by Coldwell Banker and the National Association of Realtors®: • Staged homes spent 50% less time on the market than homes that were not staged. • Staged homes sold for more than 6% above asking price. • A staging investment of 1% to 3% of asking price generates an ROI of between 8% and 10%. • Homes staged prior to listing sold 79% faster than homes staged after listing.
WHAT DO BUYERS WANT TO SEE?
Most home shoppers are envisioning a fresh start. If they can picture themselves living in the home, the home will be easier to sell. This is known as “making an emotional connection,” where the eyes are drawn to inviting spaces and light, as well as to unique features. Each room needs a purpose or suggested use. The home must feel updated to reflect ease of upkeep. The goal is to create a clean, simple, and contemporary feel. Painting, updating fixtures, and eliminating stained carpets and popcorn ceilings can affect 26
the saleability of the home by 75%!
NEUTRALIZE FOR EYE APPEAL
The idea is to neutralize the home regarding personal taste or decoration such that buyers can easily envision the home as it would be outfitted in their taste or with their possessions without the distractions of the seller’s taste and possessions. In staging, distractions are removed so the buyer can imagine living in each space of the house. Only 10% of the population can visualize what a room might look like. Meaning 90% of people cannot imagine furniture in an empty room or look past your stuff in a full one. Usually when a stager sets up a room, that is the way the buyer will position their furniture when they move in. An effective way to appeal to the most people is to paint the main rooms a neutral color. I am a certified color expert and can help you choose neutral colors. Neutral does not mean boring. Neutral colors include greens, grays, creams, beiges, or yellows. The shade or the tint makes a huge difference. Did you know that nearly half of all paint sales are to correct a just-painted wrong color? Using the same color in visibly adjacent rooms gives the house a seamless look and uninterrupted flow. However, powder rooms or children's bedrooms can look more unique. Dark or bold wall colors can dampen interest in a home if used in large spaces; however, they can be used effectively as accent colors.
FOCUS ON FURNITURE: LESS IS MORE
In staging, you want the prospective buyer to envision themselves living there. De-personalization and minimization is the key. In an occupied home, your personal taste and style will be showcased
while the home is on the market. But there are many ways a home stager can make your furniture and accessories more appealing. In most cases, removing some pieces and then re-positioning what stays allows for a nice flow. Buyers are attracted to homes flooded with light and roominess. They are equally put off by cramped homes filled with unnavigable spaces. Home shoppers want to walk through a house without obstacles in the way. Space and storage are high on the list of buyers’ desires, so every area of the home should feel spacious. Remove all unnecessary furniture from living spaces and store it. Closets, pantries, and basements must be free of clutter and organized. The goal is to show there is ample space and storage. If your closets are over-flowing, that tells the buyer there isn't enough space for their items either. Furniture placement is an easy way to highlight unique house features. Find the focal point of a room, or create one. Then position the furniture so it enhances that focal point. The focal point can be a fireplace, a stunning view, or built-in cabinetry. (Never use the TV as a focal point unless it's a theatre room). Some furniture pieces can "float" in order to create a conversation area. Be aware of where the electrical outlets are. Not every room needs to be staged in a vacant house. An empty extra bedroom, for example, is better than a poorly furnished room. Concentrate on the main living areas: living, dining, kitchen, master bedroom/bath, powder room, office, and foyer. People will see the usefulness of the basement rec room or extra bedrooms to fit their needs.
Once every room has a focal point and a purpose, creating
atmosphere is crucial to making the home emotionally-desirable. Decorative touches of greenery, flowers, and candles give life to a room. Appropriate wall art (hung at eye level) can do the same. A bedroom that has one bed with one pillow and blanket will make the room seem bare and lonely. You could add a night stand with a lamp and a rocking chair draped with a lap blanket, to heighten its appeal. Be sure to add elements of the same color, shape, or texture to unify the room. But also include a "pop" of color here and there. Learn to strike a balance between staging and living in your home. The main goal is to keep your home clean and free of clutter that distracts would-be buyers. Even simple things can make a big impact on the final sale price of a home. Staging done well is one of those things! I am a certified professional home stager and color expert. My staging is included with any of my listings.
TO STAY OR NOT TO STAY?
Home sellers often ask whether they should stay in their home while it is on the market, or go. There are pros and cons to both, depending upon your situation. Some people need to move by a specific deadline. Others can be more casual about the timing. If the seller has hired a real estate agent, the burden of showing the home is virtually eliminated. The agent will field all calls, set appointments, and show the home according to your wishes. If you stay in your home, there is constant pressure to keep things in pristine condition. You'll need to leave the house for showings with as little as an hour's notice. In the first few days, the house might be shown constantly. You will also need to remove or crate pets, and perhaps interrupt children's routines.
Alternatively, a vacant home can be interpreted that you are a “motivated seller” who needs to sell quickly. Often, that is a true statement, but not always. One comment on a real estate online forum said a buyer made an offer $30,000 less than the $300,000 asking price, believing the owners were desperate to sell their vacant house. The buyer loved the house and would have initially offered more, but because the buyer noted the house was vacant, he started from a lower negotiating price.
CHAPTER 6 Upgrading with ROI in Mind
Making upgrades can be as easy as replacing the handset on your front door or as daunting as remodeling a kitchen or bathroom or even repainting the entire house. The question is always what home improvements give the best return on the remodeling dollar? Return on Investment (ROI) is generally less than 100% in real estate, so the rule of thumb is “less is more.” It is frequently advised that it’s better to update/remodel your home while living in it and not solely at the time it comes to sell. That way, there is more enjoyment in the improvement and less cost in preparing for sale. Some desirable upgrades or home improvements will not return their cost in the sale price. A remodeling publication said the best ROI improvement a home seller can make is insulating the attic space, with a 116% return. If your home is worth $275,000 and you spend $25,000 to revamp the kitchen, don’t make the mistake of assuming that the investment will increase the value, dollar for dollar. The remodel may add value to the home, but the return in dollars spent will be around 50%. Smaller upgrades, like replacing outdated fixtures in the kitchen and bath, are certainly worthwhile, but major remodeling of those rooms isn’t wise just to sell your home. That’s not to say you can ignore necessary repairs that a home inspector would red-flag or a mortgage company would demand before issuing a loan to a buyer. If major problems, like a leaking roof or outdated electrical wiring, exist, you may need to repair those before putting your home on the market, or expect to give concessions to the buyer. Check what the current building codes
are; i.e., each level needs to have a CO monitor and each bedroom needs to have a smoke alarm.
STARTING WITH THE BASICS
Every listed home should meet the basic expectations of any buyer; it should have a sound roof, functioning gutters and downspouts, foundation without cracks, functioning heating and/ or air-conditioning system, solid subflooring, and safe and secure electrical wiring. With financer-mandated home inspections, any shortcomings may be required to be remedied to get buyer financing approval. It is important to understand that the market value of a home is determined by the prices of comparable homes recently sold in the area. Extensive remodeling to sell the home or to increase the value may not pay off. The property needs to be up to the standards of neighboring homes, so while the kitchen has to be comparable to others, as in the example above, spending $25,000 to remodel a kitchen in an area where comparable homes recently sold for $275,000 will not increase the house’s value to $300,000. While it may be a helpful selling feature, it won’t return dollar-for- dollar value.
MECHANICAL MAINTENANCE IS A MUST
It is easy to get wrapped up in the more eye-pleasing aspects of preparing a home to sell. However, the upkeep of all the more mundane aspects of the home cannot be overlooked.
These mechanical features require consideration:
• Electrical boxes and wiring • Natural gas lines • Plumbing 33
• Central heating and air-conditioning • Water softener
If these components are old, outdated, or not working correctly, the home’s appeal is lowered, as is the eventual sale price. People want to purchase a home that reflects their aesthetic tastes and lifestyles, but also one that is safe and sound. Faulty electrical systems do not provide a feeling of safety. Leaky plumbing arouses concerns of mold infestation and sewage problems. These areas can require extensive work and are extremely important. Overlook them in the preparation stage and you run the risk of trouble later with inspections and appraisals, and contingencies. It aids the sale if professionals certify or remediate any deficiencies in the mechanical systems. Having a professional inspection for buyers to review is a big plus in marketing. • Have a certified plumber inspect the entire water system for leaks. Check the well and septic field, if applicable. • Hire an electrician to check the wiring. • Call an HVAC company and have technicians perform a thorough service checkup. • Contact the natural gas supplier and have them double- check the mechanics of your tank and lines. If you’re looking for an alternative to calling and arranging all the different inspections, certified home inspectors usually cover all items related to mechanical issues (and more). They will be able to identify possible trouble spots. Many buyers hire an inspector, so you may be saving them a major step in the sale process. If you have mechanical issues and decide to sell your home “as is,” and think your list price reflects this, a buyer will still offer less.
New appliances undoubtedly make an impact on buyers. The National Association of Realtors® conducted a survey of buyers and found that: • Buyers were usually “interested” or “somewhat interested” in buying a home that featured new appliances. • Roughly 17% of respondents preferred stainless steel. • The most important factor: available appliances. • Most buyers who were unable to get their sought-after appliances said they would have been willing to pay, on average, nearly $2,000 more for them. Potential buyers want appliances included and will pay more for them, especially if they are new or in excellent condition. New appliances might be what sets a house apart from the home for sale across the street. If new appliances are out of reach, offer immaculately clean and fully functioning existing ones.
Carefully inspect your bathroom and kitchen hardware. If it is unsightly or worn, it’s best to replace it. Put yourself in a buyer’s shoes. Your home will potentially be their new home. Old, worn- out fixtures are not going to speak to them the way nice, new shiny hardware will. Unless your knobs, pulls, handles, or hinges are broken, you need not replace them. Get that fresh look simply by thoroughly washing, sanding, and painting them with spray paint made specifically for kitchen and bath hardware, making it cost- effective.
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