About ARDELL

ARDELL is a Managing Broker with Better Properties METRO King County. ARDELL was named one of the Most Influential Real Estate Bloggers in the U.S. by Inman News and has 34+ years experience in Real Estate up and down both Coasts, representing both buyers and sellers of homes in Seattle and on The Eastside. email: ardelld@gmail.com cell: 206-910-1000

The YES, NO, MAYBE tour for relocating buyers

Posted on April 14, 2006 by ARDELL

I invented this back when I was doing a lot of relocation work for Coldwell Banker on the East Coast. I thought Dustin and Anna might like to try it when looking at homes in California. It comes in very handy when you are touring a lot of homes the first day in a new area.

It’s pretty simple. You each have three little cards (kind of like Richard Simmons’ Deal a Meal – yes, it was that long ago when I came up with this.) One card says YES, one says NO and the other says MAYBE. You can only use ONE card in each house. Anna has a set and Dustin has his own set.

At each house you are not allowed to say a word to one another until you make your selection from the three cards. If you are touring homes with an agent, you hand her one of the cards as soon as you know your answer, not how you think your spouse will feel about the house. Since there is a MAYBE card, this should be a fairly quick procedure for most people. If the agent gets handed two NO cards as soon as they walk in the front door, you can all get back in the car. Unless the owner is home, in which case you do a “pity” pass through. Easier than saying we already know we hate this house.

If you have all NO cards played at the end of the day, what you don’t like is your price range, and you may have to go back to your new employer and say, “what you offered to pay me is not enough to live here”. If you have three YES houses where you both said YES, you may as well toss out the MAYBE houses and go back at the end of the day to the three YES houses and spend more time in them. I usually ask people to rank their YES choices as they go. First YES, no ranking. Second YES, you have to label one #1 and the other #2. This way if you have 7 yes houses at the end, you can go back to #1, #2 and #3.

Why did I feel the need to invent this system? Can’t people know if they like a house without a little card?

Here’s why.

1) Sometimes the relocated spouse feels guilty about making the family move and says “Whatever my sweetie wants will be fine with me” until it is time to sign the contract and wants to offer 80% of asking price. That’s called saying yes and meaning no. It’s a passive/aggressive thing some people do 🙂

2) The wife walks in first and starts saying things like, “well, we could take this wall down over here and we could add a master bathroom…”, take it from experience, that’s a NO. Before they start arguing over how they are going to afford the time and money to do all of that stuff…get a NO card and GET OUT! Otherwise they will be crying and fighting before you get to house number 4.

3) When they both hand me a YES card and find out that the other party agrees, they can move through the house really evaluating whether or not they should actually buy it, instead of discussing whether or not the other likes it. And you will be amazed at how happy they both are when you tell them they both said YES. Sometimes one spouse is afraid to say they like the house because they don’t want the other spouse to buy it just because THEY like it. It is a great moment when they both hand over a YES card.

Of course the client that keeps handing me all three cards at every house drives me nuts 🙂 Some people just don’t like to be pinned down.

MOVE.com – a strategic shift

Posted on April 13, 2006 by ARDELL

We, here in the Seattle area, are in the unique position of seeing first hand, the coming of change. There is no place in this country on a parallel path with technology and the future, like the Seattle area. The hiring of Dustin Luther by Move.com is as significant as Realtor.com BECOMING Move.com It is a sign that the butterfly may finally be springing from its cocoon. MOVE hiring Dustin Luther as the Director of Consumer Innovations, is the starting bell we have all been waiting for, announcing the metamorphosis to come, in an industry long overdue for change.

Back in October, when Realtor.com hired Allan Dalton as President of Realtor.com http://www.realtor.org/realtororg.nsf/pages/realtorcompres?OpenDocument it appeared to be simply another dose of “same old; same old”. I attended Allan’s recent “seminar” in Bellevue earlier this year, and left with the feeling that he was somehow chastising the industry at large and its professionals in the room. It was as if he were screaming “embrace change or BE changed!”

I am sitting here with my signed copy of “REAL ESTATE TECHNOLOGY GUIDE” authored by the “Tres Amigos”, Saul Klein, John Reilly and Mike Barnett of Internet Crusade. These three men have almost “single handedly” moved the real estate industry into the present with regard to technology, since they met one another in 1995. And yet it would seem that they too are screaming “embrace change or BE changed!”

The hiring of Dustin Luther by “MOVE” is a huge pendulum swing from the hiring of Allan Dalton by “REALTOR.com”

It is a sign that the movers and shakers of this industry may be attempting to “moult from their skins”. For too many years they have lain constrained in the hardened cocoon they themselves have weaved. Like the “constrainedness of the caterpillars and chrysalises, their range of activity and movement has been very little as they have been cumbersomely tied to their food source”, the REALTOR organization.

[photopress:dustin_1.jpg,full,alignright] Time and again we have seen the cocoon harden around the “would be” innovators. Will the industry escape? Is the hiring of Dustin Luther and the Title: Director of “Consumer Innovations”, a sign that the largest and most powerfull conveyor of national home listing info, may be willing to shed its REALTOR shackles and MOVE into the consumer’s long awaited public venue? With the hiring of the white butterfly, instead of another caterpillar needing a food source, I am hopeful. I am very hopeful.

Professionalism and the email address

Posted on April 9, 2006 by ARDELL

How does one acquire the title of “professional”? This is a subject often debated in real estate circles. Are doctors professional? Yes. Are lawyers professional? Yes. Are real estate agents professional? Are mortgage reps professional?

I am prompted to raise this point by the last two comments on a previous post. An “anonymous” commenter asks if anyone is “kicking ass today”. Dustin responds with “?”. Seems to me this same commenter has raised the “kick ass” question before. By following the trail to the source, one can assume that this commenter is in the mortgage business in Southern California. One can also follow the yellow brick road to his email address which is at Yahoo.com

People often ask how they should select a real estate agent and/or mortgage person. Maybe it is not fair to say that those whose email address is yahoo or hotmail or even aol are not “professional”. But doesn’t it seem so? Can it be as simple as that? Often when I am caught in a transaction with a less than professional agent or less than professional mortgage person, I am dealing with someone whose email address is nastyboy69@hotmail.com. So I think I will go out on a limb here and propose that one’s email address IS an indication of who you are dealing with.

If you want to be perceived as a professional, if you want to be viewed as someone whose standards of practice reach the level of “professionalism”, then take the extra step to acquire an email adress with a professional domain name. Conversely, if you choose a real estate agent or lender, or even a lawyer, whose email address is kickass4U@yahoo.com, then don’t complain when they appear to be less than professional when acting on your behalf.

Floor Area Ratios – Bulk and Volume

Posted on April 7, 2006 by ARDELL

I attended a meeting this week regarding proposed changes to the current FAR in my neighborhood in Kirkland. I thought I’d report on Kirkland specifically on my blog, but raise the BIG question here. Should neighbors and local governments be able to dictate, beyond height and setbacks, how “big” your home can be?[photopress:bigger_house.jpg,thumb,alignright]

Is the “argument” really about size? Or is it about “style”. It seems that people complain more about homes with a flat roof made of smooth stucco, than they do about homes with pitched roofs. If everyone in town hates the house you want to build, should that matter? Is this argument really about trying to dictate “taste”. When an old house is torn down, the new one built in its place can’t be expected to look anything like the one that was there, can it?

[photopress:big_house.jpg,thumb,alignright]

The reason more houses are being built with a flat roof, rather than a pitched roof, is because of the height restrictions. Here the height can’t exceed 25 feet. If you have a point at the top, that point counts as your 25 feet, so you lose a lot of square footage at the top vs. building your second floor up to 25 feet with a flat roof.

FAR is not so much about the size of the house, as it is the size of the house relative to the lot size. If the building code has a restriction of 50% FAR, then the maximum size of a house on a 5,000 square foot lot is 2,500 square feet. Unlike real estate agent and appraiser criteria, building code square footage can include the attached garage, but often does not include the “air space” of a two story room with no floor at the second level. “Volume” related complaints suggest that this “air space” should be included in the square footage as if it had a floor.[photopress:small_house.jpg,thumb,alignright]

I will stick to the specifics of the actual Kirkland meeting on my blog, but here in RCG, I thought we could talk more about the issue generally. Used to be as long as you adhered to the height restriction and setback rules, all was A-OK. Now people want to dictate and prevent “monoliths” and homes that just don’t seem to “fit” into the type of town “we” want to be.

The fur does tend to fly at these meetings. Anyone have any opinions on this topic? Some of the questions raised are “Why do so many new homes have such small yards?” Should we really be able to tell people whether or not they MUST have a “yard”? Whatever became of one story houses? and “What’s going to happen if my neighbors sell?” Should we let people do whatever they want with the land that they own, or should neighbors and local governments have some say in the matter?

Weigh in your opinion. Inquiring minds want to know how people feel about this topic.

Once in a Lifetime Event

Posted on April 4, 2006 by ARDELL

For those who enjoy “being there” and awake for such things, if you can hold out and stay awake past 1 a.m. tonight you will experience a Once in a Lifetime Event: 01:02:03 04/05/06

Should you have an Open House?

Posted on April 3, 2006 by ARDELL

I just sold another house from an Open House this weekend, and am reminded of all of the articles about how Open Houses do not sell houses. Sometimes I think the articles are sponsored by agents who don’t want to spend their Sundays working 🙂

I have changed a few things that I do based on technological advances, like pricing the home straight on $350,000 for double hits, instead of $349,899 to be first to show in the mls book. But listing and selling houses via Open Houses has always been “my thing”. I have provided some online training on the subject to agents around the Country, and still there are some agents who can honestly say that they have never sold a house from an Open House. It just boggles my mind.

I have always spent a great deal of time helping the seller get the house ready for weeks beforehand, before it goes on market. Then I usually do open houses the first two weeks back to back. This weekend I listed a property, that I had already spent many hours staging,and put “No showings until the Sat. Open House and Open Sat. and Sun. 1-4 p.m.” in the mls remarks. This is less wear and tear on the seller and creates a new listing that opens up with a BANG! Lots of energy! Agents showing and people coming all at the same time. I have 6 Open house signs and those big flags that new construction people use. It’s like a big party! Sometimes I even cook Italian food and play Connie Francis and Mario Lanza…and of course FRANK! But that’s usually for Broker’s Opens. I even had agents dancing once…that’s an accomplishment 🙂

Anyway, back to this weekend. I had an offer by the time the Open House was over and another from an agent who was begging me to wait for her as she rushed back two hours from wherever she was to write it for the buyers who came without her to the Open House. Turned out I didn’t have to do the Open House on Sunday, as it was all tied up by noon on Sunday.

Of course an agent who sits in the living room watching the ball game or playing with his laptop looking bored to tears may never sell a house at an Open House. But if you love doing them, there are plenty of ways to turn an Open House into a SOLD House! I hate to admit it, but I did get a call from my friend Reidi in Florida when she saw American Beauty. When Annete Bening got to the Open House hours early in her work clothes scrubbing it down saying “I am GOING to sell THIS HOUSE TODAY!!, Reidi called me and said “Ardell, they made a movie with YOU in it! LOL I’m not quite that bad…but close.

The ROOF – Things you should know

Posted on March 26, 2006 by ARDELL

Whether you are buying or selling real estate, or just trying to decide about your own roof replacement, there are a few things you should know about a roof. As I look out of my window, 95% of the neighbors have a composite shingle roof. So let’s talk about those.

When you are buying or selling a house with a composite shingle, do the math. The house next door to me has a 20 year shingle. The house next door to that one has a 30 year shingle. It is easy to tell a 20 year shingle, because the shingles lay flat, with almost no “definition”. As the shingles get thicker on a 25 year, 30 year, 35 year and up shingle, there is definition and a “layered” look. Even some of the best home inspectors can’t tell a 30 year from a 35 year shingle, so if you are a seller, and know you have a 35 year shingle, it would be good to tell your agent to highlight that feature, and you should also put it on your Seller Disclosure Form.

Sellers: Don’t forget to put GOOD things on the Seller Disclosure form, so it is not merely a highlighting of “bad” things. Add a list of good things, as an attachment if needed, and have the buyers initial the attachment too.

It took me about a week in the real estate business to learn the simple lessons of “roof math”. When I was selling my own home in Cherry Hill NJ, the home inspector went up the ladder to the roof. He came down and told the buyer that the roof was about 18 year’s old and may need to be replaced in 2 years, because it was a 20 year shingle. I said, “The house was built 8 year’s ago. Are you saying they found some 10 year old shingles to put on the roof of a new house?” I really wasn’t trying to be “flip” or nasty, it just popped out of my mouth like that in true “Philly” style.

Everyone should know how to do the simple math of a roof without relying on the inspector. Not because the inspector will be wrong, but because a roof can be just fine and still be “due” for replacement soon. I’m not going to go into second shingles and third shingles, because something tells me these will be obsolete in the future, given most roofs are no longer flat enough to go that way. I will mention roof color briefly. Mr. Cherry Hill Home Inspector was somewhat correct, in that it was a black shingle. Often black shingles will not make it to 20 years, while gray or tan ones can go to 23 or 25. Heat absorption issues. You see very few black roofs in year round sunny climates, like Florida and CA.

Buying a condo? Think you don’t need to look at the roof? Not so. A few weeks ago I attended a home inspection of a condo built in 1986. I walked across the street and climbed up on something to see the roof. The inspector and buyer said “What the heck are you doing over there?” I said I’m checking out the roof. The inspector said “Why? That is the condo association’s problem.” By then both the buyer and inspector joined me under my “perch”. I said look, it’s flat, it’s a 20 year shingle, right?” Inspector said yes. I said “This place was built in 1986. 1986 plus 20 equals 2006. When I get the resale certificate, I need to check to see if they have enough money in reserves to replace the roof, or warn the buyer about a possible special assessment. I need to check the Reserve Study for cost of replacement. I need to check the dollar amount currently in reserve for all replacement items. If there is not enough money there for all things, I need to divide the shortfall by the number of units, or prorate per total square footage of complex by unit size, and give a range of possible special assessment amount.

Buyers note: The condo association is YOU. There is no Fairy Godmother, named HOA, with a magic wand.

I’ll end with this “red flag” for both buyers and sellers. I ask the owner or listing agent, “How old is the roof, especially when I can’t do the math well on a 1917 built home…too many roof changes to do simple math. Owner responds: “I just had the roof checked and it’s fine.” Big red flag! That is not the correct answer to “How old is the roof” 🙂

Zero Commission

Posted on March 23, 2006 by ARDELL

[photopress:howie.jpg,thumb,alignright]We’ve been talking down there in the comments about all of the things agents are “not allowed” to do. One benefit of being an independent is that you can be an avant-gardist and try out new and different things from time to time. I had this idea. Everyone knows that when you list a house, you often sell other houses as a result. Buyers call on the sign or from the internet or you meet them at an open house. These buyers may buy the house they called about, or they may buy a different house from you.

How about reducing the commission on the house you have listed, every time you get a buyer client as a result of that seller’s house being for sale?

Let’s say it is a condo priced at $225,000 with a seller’s side commission of $4,500. Someone calls to buy it, but they have a dog and that condo association doesn’t allow dogs. You sell them a different condo that does allow dogs and earn a commission of $5,000. You would never have met that buyer if they didn’t call on the condo listed at $225,000.

So how about taking 10% of the $5,000 you made as a result, and reducing the fee on the listing from $4,500 to $4,000. Get two buyers from calls on the listing, and the fee goes down to $3,500. Of course no one would want their property on the market long enough for the agent to get 10 buyers, lowering their fee to zero. But it would be possible. Maybe it should be 20% each and 5 buyers to get to zero.

What do you think? Too complex? Is figuring that out as hard as trying to figure out what is going on with Howie on Deal or NO Deal? Maybe I shouldn’t have watched that American Inventors show…agents aren’t supposed to be as “out of the box” as you techies 🙂

I didn't get the house…WHY?

Posted on March 22, 2006 by ARDELL

When there are multiple bids, and the price of the property is bidding up over the asking price, the amount of downpayment is sometimes the reason why your offer is not accepted.

Let’s say a property is put on the market at $275,000 and the highest offer is $315,000. There is an offer of $310,000 with 50% down and an offer of $315,000 with zero down. Usually the seller’s agent will advise the seller not to take the $315,000 offer, because she does not expect the property to appraise. While one can buy a house with zero down, that does not mean that the seller is willing to take the risks associated with a zero down buyer.

It is the seller’s agent’s job to know not only what they can get in the open market for a property, but also what obstacles might get in the way of the sale closing. These days, when an agent lists a property at $275,000, it is likely a price higher than the last few sales in the area and a price that will appraise, with some effort. When it bids up over that amount, the seller’s agent must be ready for what will happen if and when it does not appraise. Often that means that zero down buyers will not get the house, if there are other offers with larger downpayments, even if the other offers are for less money. A common result will be that the seller will counter the 20% down buyer with the highest price offered, regardless of escalator clause considerations.

This points back to my post noting that the appraisal is done for the lender. If the property appraises at $300,000 and the sale price is $315,000, the lender does not participate in the shortage. If it is a zero down loan and the buyer has no cash, the buyer will need the seller to reduce the price down to $300,000 for the transaction to close. The lender will only give the buyer 100% of the appraised value, without regard to the agreed upon sale price. If the buyer is a cash buyer, often there is no appraisal at all, since the appraisal is ordered by the lender.

This issue has come up in the last two offers I have presented. In fact, I lost a client who did not get the property because another offer at 20% down trumped her zero down offer. When she asked me to be more aggressive in getting her offer accepted, I explained that the seller’s agent made it clear that the 20% down buyer was going to get the property because they had 20% down and the agent knew the property would not appraise. There was just no way to get the seller to accept a zero down offer, with the costs included in the price, no matter what I did.

Buying your first property with zero down and the seller paying the closings costs is clearly possible, and is done every day. But often the zero down buyer, with no cash to pay their own closing costs, is excluded from purchasing the most popular house in the most popular neighborhood that has multiple offers.

Offering the highest price is of no consequence to the seller, if you can’t close.

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