Should you buy a New home or an Old one?

Posted on September 19, 2011 by ARDELL

Lots of people want a NEW Construction home, the same way they want a new car vs a used car. However starting the home buying process at “I want NEW” is just as wrong as starting the home buying process at “I want a foreclosure”.

As I have said many times, in my experience more people HATE their “home”, and want to move to a different one, because of WHERE it is vs WHAT it is.

“…and underneath all is the land…” and land is a limited commodity. So where is that NEW home going to be built? Maybe…just maybe…on the wrong piece of land. The lot no one built on prior to 2011…for good reason. Even NEW(er) home will raise this issue. So if you have your heart set on a NEW home…the number one question you need to ask is:

WHY DIDN’T ANYONE BUILD A HOUSE ON THIS PIECE OF LAND BEFORE TODAY?

So many people limit their looking to the obvious and the house itself. If you are looking at new or newer construction…begin your investigations at the land that home is sitting on. Looked at one yesterday…without going to it…via Google Maps and the Stormwater Management Comprehensive Plan for that area, and the house was built on a lot IN “The Wetlands”.

Think about that for a minute. What are the various reasons a lot might be available for someone to build homes on today…that is close in to work and good schools and shopping? It’s common sense really. Especially today…after a huge building surge from 2004 to 2008…was there really a piece of land the builders didn’t find and build on during that time? Yes…a few…but not many.

IF wanting a NEW house is your goal…you would be wise to first examine the land of it…and why no one built on it before (unless it is a tear-down lot). Oddly, the one I checked that was “in the wetlands”, well…really, you have to ask yourself. How DID it get built there? Basically one is not allowed to build a house in Wetlands. Why does it not require flood insurance with drainage basins to the north, east AND south of the house?

Think you can “see” all that? Well what about too close to underground gas pipelines? Can’t see that.

My point is you are better off listing all the things you want from a neighborhood, a location and a home, without regard to AGE of home. Then…if none that have the best location are new…well, maybe NEW Construction should not be the FIRST item on your “wish list”.

Prioritize that wish list by the where…before the what in that where. It’s common sense really, isn’t it?

If it has been a Best Place to Live for 10 to 100 years…it was likely built on before yesterday.

Do “discount” Commissions = More Failed Pendings?

Posted on September 14, 2011 by ARDELL

Everyone has been asking why there are many more failed pending sales these days.

One of the answers is that historically, a portion of “high” commissions has often been spent to keep the sale together through closing.

Let’s use a $450,000 house as the example.

In today’s market conditions, the seller may have “wanted” $500,000 for his house, and is “forced” by market conditions to sell it for $450,000.

In today’s market conditions, the buyer is fearful of future loss of value, and may have agreed to paying $450,000…but the buyer really wanted to pay $400,000.

A sale #FAILs over small things when the contract is on the low side as far as the seller is concerned, and on the high side as far as the buyer is concerned. That describes almost every pending escrow these days., except for short sales and bank owned property.

SO…let’s say that the agent for the seller is going to charge 2% at a 1% discount…and the agent for the buyer is going to charge 2%…at a 1% discount. That frees up $8,000 to handle “stuff”. BUT if the commission is simply discounted from the getgo…well, it may be setting the transaction up to FAIL.

IF EACH AGENT held 1% (2% total) as a “reserve for negotiation disputes”

vs reducing the commission on day one…

less transactions would fail.

The seller and buyer would pay less to get SUCCESS

vs paying less to get FAILURE!

1) ALSO the seller is often OK with giving $3,000 for “this” but not for “that”…so holding a reserve removes the emotion from the equation.

2) ALSO sometimes the seller is OK with giving the buyer a credit for that repair…BUT the buyer’s lender will not allow the credit. So you need to do a bit of juggling, often involving commission dollars vs “seller credits”.

You have to be creative in a weak market…and often juggling commission dollars is what makes the difference between “sale FAIL” and “sale CLOSED”.

This post is in response to a request I got from an agent in my email:

Agent asked me this: “I am a relatively new Agent (less than 1 year) in (X) I was very interested in your input on Redfin regarding working with using a bit of the commission for payment of inspection repairs. Any chance you have a moment to give me specifics on how this is accomplished? Uncertain on how, and when, this would be setup? I still struggle a bit with staying exactly within the MLS formats.”

In response, in addition to the post, I will give a few recent examples.

1) I listed a home for $399,950. In this case I was going to charge a $10,000 flat fee for me and a 3% offering to the Agent for the Buyer. Instead I did a 6% contract, knowing I would not charge the seller more than $10,000.

Everything went fine…got an offer…went into escrow…we told the buyer 3 things that were broken. During inspection negotiations, oddly, the buyer asked for $1,300 for 5 things…but not for any of the things that were broken. The seller would want to argue the point of “for what??”.

By reserving $2,000 for inspection repairs there was NO dispute…The buyers got the $1,300 that they asked for and by agreeing to the buyer’s request…the seller got $700 change. Win-Win by using commission dollars vs letting the buyer and seller negotiate it to the point of “Sale Fail”.

2) I listed a much older house than the one above for $600,000. Same scenario. I was charging the seller a $10,000 flat fee…but stated that as 3% with $8,000 as a reserve from commission for repairs.

At time of inspection the buyer wanted the roots in the sewer drain fixed and $6,000+ for repairs, including the things we told the buyer were in need of repair. In a hot market…that repair was not needed or requested. In a WEAK market…there are more things “broken” to cause a #FAIL. Market conditions will change a “no problem” item into a $5,700 “fix”, as it did in this particular case.

The front porch of an old house leaning a bit in a hot market is a “no-nevermind” with multiple offers. In a WEAK market the buyer wants money to fix the slight tilt of the front porch. Same house…same problem…different markets = different inspection request.

Long story short…with no commission dollars to fix the problems…the sale would have failed. By reserving $8,000 toward repairs…the client was successful. IF I had listed it for a $10,000 flat fee…on day one…the sale would have failed.

So giving that discount up front would have caused the sale to fail.

3) The house I sold in about 20 days that was the subject of my “Why Agent’s Are Better than Lawyers” post. Sold at Full Price with Max Credits from seller to buyer. Lender would not allow any more seller credits. As I noted in the post, I charged $5,000 BUT what I don’t say in the post is I reserved the $2,500 in a 3% charge toward repairs.

At time of inspection, buyer wanted several things. Neither I NOR the seller could give a credit for them. The buyer’s lender would not allow the credit. At least one of the things was not needed at all…and pretty costly.

The sale would clearly have failed over that item without the reserve from commissions. No question about it.

By doing the repairs prior to closing and paying for the repairs from my commission at closing…the seller and buyer had a successful closing with all repairs DONE! Awesome result. Quick sale..everyone happy.

Moral of the Story?

Saving Money…and losing the “successful closing”

by discounting UP FRONT

vs when needed MOST…

may be a Lose-Lose for everyone.

Do you want a “full service” real estate agent?

Posted on September 13, 2011 by ARDELL

Do you WANT a “full service” real estate agent?

Many will say “NO, I don’t want my agent 2nd guessing ME!” Then don’t pay the price for one. Don’t hire one in the first place. Instead, find a lower cost “service provider” who would not presume “to tell YOU, the customer, that you are wrong”. Hire “less for less”.

But if you want someone 2nd guessing you, every step of the way from start to finish, so that you do not make even a tiny mis-step, without knowing it, when buying or selling something that costs hundreds of thousands of dollars…then you may not want to save those dollars by choosing “less for less”.

The reason we need many and varied “models” in real estate, more than are currently available, is because not everyone wants or needs a “full service” agent. If you need “less”, then “less” is full to you! Let’s explore the “full service” model so that you know when “full” is paying too much for what you may need.

The key is knowing which model suits YOUR needs best.

The FULL service agent is represented by the blue person in the middle

who is managing and 2nd guessing ALL of the people

who will be involved on your behalf.

ONE of those people is YOU!

A “full service agent” is not a service provider who is giving you what you ask for and doing what you tell them to do. A “full service agent” is helping you get the right answers to the RIGHT questions…not merely those you happen to ask.

A “full service agent” also does not fully delegate the other services like lender and escrow and home inspector and does not keep their nose out of those valued roles in the transaction.

A “full service agent” does not merely help you buy a house that is for sale. A “full service agent” tells you when all of the best houses have just been sold off, and you are picking from an inadequate selection, and should wait for the next better home to come on market.

If you go to the market an hour before the next bread shipment comes in, and the only bread on the shelf is day old bread, do you buy that bread? No! You ask when the next shipment of bread is coming, and if they say in 20 minutes..you do the rest of your shopping and come back to the bread aisle when the fresh bread is available. When you choose from only those that happen to be “for sale” at the time you are looking, you are not doing “it” right. You may be buying “the day old bread” at a GREAT price!

You should not be looking at homes with your agent to pick one to buy.

You should be looking at homes with your agent to determine what it is,

that may not be for sale today,

that you should buy.

IF you are looking for a hot commodity…one that the majority of home buyers want…then the one you are standing in with your agent is NOT likely “it”.

The odds are not in favor of it being for sale…and OMG! no one else found it in 72 days.

Let’s get the wrong “it” for less, because it is stale on market, is NOT how you buy a home for your family

to live in for 10 years or more.

Homes value on a relative basis. YES you can pick a lesser location or lower valued home style and pretty much anything you want. BUT a full service agent will make you think VERY HARD about your choices, and how they will impact you on resale…some day…in the future. A full service agent will tell you what price that “what you want” SHOULD BE…not what price you can get it for based on negotiations with the seller.

If the Seller is asking $700,000 and the “fair” price for that is $550,000, you need to know that. That is not a ludicrous example…I just ran into that the other day with a client. Do you want an agent who tells you that you can get it for $650,000 if it is only worth $550,000? Will you feel great that you saved $50,000…but paid $100,000 too much?

Most importantly…will you resent the fact that the agent pointed out it is only worth $550,000?

Will you hate the agent who is giving you a headache by forcing you to see all of the important things you need to consider before spending hundreds of thousands of dollars?

The NUMBER ONE feature of a lower cost service

that says they are FULL service…

is they do not 2nd guess YOU…the client.

Examples:

1) Seller wants to price his house at $700,000. There is no way a buyer should pay more than $550,000 for it. $500,000 would be a screaming deal for a buyer. Anything OVER $550,000 would be great for the seller.

A FULL service agent will help the seller do what it will take to get $575,000 or $585,000 before it is listed for sale, and price it at $599,950.

A “service provider” will list it at whatever the seller wants to list it for and stick a sign out front and a lockbox on the door…and charge LESS for that and CALL IT FULL SERVICE for less. What it IS is “less for less”.

2) Future home buyer wants what 65% of all home buyers want. A new(er) home (or older one that needs NO repairs or upgrades) in the BEST schools in a quiet location that is near parks, playgrounds, stores and work…AND he wants it for $100,000 LESS than what it costs to get one of those. (Pretty standard scenario, BTW.)

A FULL service agent will show the buyer where they can shave off that $100,000 by compromising on the “correctable” deficiencies vs the NOT correctable deficiencies. OR, at mininum, HIGHLIGHT the deficiencies that come with that $100,000 “less” price. Often the buyer will put their head in the sand as to the weaknesses that cause the price to be $100,000 less than it should be. Some buyers want the agent to not mention those deficiencies. They want to pretend they don’t exist. A FULL service agent will make sure they are buying with “informed consent” regarding those deficiencies.

A “service provider” will help them buy the home they want and say “who am I do say “that” is a “deficiency”. If the buyer likes it…and is willing to pay for it…a “service privider” is there to help them get what they want. If they are happier not knowing…then it is the “service provider’s job” to make them happy and not point out the negatives. If the husband knows about the deficiency, but says “don’t let the wife know about that”…then that is the “instruction” a “service provider” will follow. That is “LESS for less.”

When is “less for less” FULL to you?

1) IF you don’t want your “agent” to 2nd guess YOU…less is FULL.

2) If you don’t want your agent treating both spouses as equal clients. If you want to keep things from “The Mrs.” because she over-reacts to negatives…less is FULL.

3) If you don’t want an Agent telling you that you are asking TOO MUCH for your home, or telling you what you need to DO to the house to maybe make it worth THAT much by creating a lot of “extra” work…less is FULL.

4) If you want your Agent to do what you say…

never tell you that you are wrong…

even when you are wrong…

less is FULL.

Do YOU want a “full service” real estate agent?

There is no ONE “right” answer to that question.

Are you a Customer or a Client?

Posted on September 4, 2011 by ARDELL

If you are buying a home, it is important to know if your agent views you as a Customer or a Client. You may ask “What’s the difference?” until you read a post like this one written by an agent titled “Are you a Customer or a Client? Do you know the difference?” and the many comments by agents that follow.

Here is a quote from that post, written by a Real Estate Agent in Idaho, in case it is later removed by the writer from public view:

“As a Realtor, I work with both customers and clients. Do you know the difference? I am a real estate agent when I’m working for my clients. I am a non-agent when working with my customers. The difference is whether or not you and I have entered into a written agreement for agency representation.”

I personally don’t agree that is the case in the State of Washington. Below is my comment on the above linked post:

“As Nathan said…in his State of Florida the default is NO representation. In my State of WA Buyer Representation IS the default.

NAR cannot legistlate this nationally …and this post is NOT true in the State of WA where all buyers are granted full representation by our Agency Laws, unless they are dealing directly with the listing AGENT not the listing Company.

There is only ONE person in this State of Washington who does not represent the buyer by Law vs by Contract, and that is the Listing AGENT.

Unfortunately, many agents here read posts like this and think it applies to them. Even the ABR class is taught that way here…that buyer is customer without a written contract…even though that is NOT TRUE here. Drives me bananas.

IF you work in the State of Washington…read that pamphlet on The Law of Agency that you hand to buyers. It says that you REPRESENT that buyer…by Law…without the need for a buyer signing a written contract to be a “CLIENT” vs a “customer”.

We have no buyer “customers” here unless the buyer signs a NO AGENCY agreement. You have to waive the representation by contract here…not get representation by contract. It is the opposite of most States, unless the buyer chooses to work with The Agent for the Seller aka The Listing Agent. All other agents, including every other agent in the Listing Brokerage…represents the buyer, by Law.

But likely 95% of agents don’t “get” that…because of writings like this one. There is NO national standard on this. State Laws apply.”

I run into agents all the time who do not understand that in the State of Washington ALL buyers are represented as CLIENTS, unless they choose to work with The Agent for the Seller or sign a NO AGENCY agreement. Agents read posts like the one I linked to…or take National Courses noting the distinction between Buyer as Client vs Buyer as Customer, and think they can treat a buyer as a customer they SELL something TO vs a Client that they represent in all facets of home selection and purchase.

Drives me absolutely bananas!

Ask your agent how you can become a Client vs a Customer. If they say you must sign a Buyer Agency Agreement to be a client…or if they say there is no difference…then they are likely treating you as a “customer” vs a client…and there IS a difference.

Seattle Eastside Housing – Buy or Wait?

Posted on August 28, 2011 by ARDELL

Seattle Eastside Housing – Buy or Wait? is a Google Query that directed someone from Bellevue over to my blog about ten minutes ago, looking for an answer to that question.

Often people get confused by the big price tags and unfamiliarity of housing, so let’s use a simple every day analogy to explore “buy or wait”. The other day I decided I had nothing to wear. I don’t know how that happens all of a sudden…usually it’s because I gained weight. First the answer to “Should I buy now or wait?” in that scenario is you wait thinking you can lose that extra weight. Then one day you just say…this isn’t working…I need to go buy some bigger clothes.

Often people need to buy a house because they have “outgrown” their current home the same way that I outgrow my clothes. Every day that you live with something substandard to your needs, is really a day wasted, isn’t it? If you are having another child, and you are uncomfortable with the size of where you live without that new person…well, you can’t wait until the child is born and moves out really. So it’s time to go look for that bigger place. Not necessarily buy it…but yes, time to go looking for something you may buy.

I use having a child as an analogy, and it is very common for people to need a bigger place because the woman is with child, or because a couple decides it’s time to start having children. But the need for a bigger place can be because of other every day needs that just don’t fit where you are.

If you already own a home, waiting is almost never the answer. The value of what you have will often move to the same degree as what you are going to buy. If prices go down 5% in the interim and you own a $450,000 home and plan to buy a $600,000 home, you will lose $22,500 while waiting to save $30,000. For the move up buyer, waiting is almost never the answer unless the family is willing to sell…rent…wait…then buy, which is not the usual scenario. Happens…but not often. Usually because what is available to rent is substandard to what they already have…so they might as well bite the bullet…or wait. The extra move in between is rarely worth it. Sometimes…yes. Often…no.

The decision for the First Time Buyer is not as difficult as people may think. One of my favorite lines from my son-in-law Mike is “Mom, if THIS is what I can afford to buy…I’d rather rent for the rest of my life.” Gotta love that Mike. Straight forward, common sense decision.

The first stage of “Buy or Wait?” is to go find out what you CAN buy for what you can afford…THEN…take a step back and say “should I buy or wait?”

I’m revisiting a decision of one of my clients from 18 months ago. I know there are many news stories saying prices have changed a lot since my bottom call of February 2009…but really, that’s not the case. Not for good homes in prime neighborhoods on The Eastside. Maybe not at all, given Aubrey Cohen’s most recent article, the title of which is pretty much a direct quote from his article on me in early 2009. So it apparently still applies today.

Back to my clients who first approached me…sorting back through 260 emails to find the first one…here it is:

3/18/2010″ “My wife and I are looking at purchasing our first house, and we’d like you to be our agent…do you think now would be a reasonable time for us to buy? I saw in your latest post that you expect the prices to drop. How much do you expect them to drop? ”

Given I don’t think this year is really any different than last year, let’s check that against reality.

1) We looked at houses priced at around $450,000. There were a few that “would do”…but based on those particular houses, I saw no reason to buy now vs wait, unless they were willing to consider as far out as Issaquah vs Kirkland, Redmond or Bellevue near Microsoft.

We looked at homes for as long as it took to gather enough information to answer the question “Buy or Wait?” That takes shorter or longer for different people…and is largely dependent on the available inventory during the period of time.

2) On 4/23/2010 We had a breakfast meeting at the Brown Bag . Basically we looked at all of the options for about 30 days and then had a “Buy or Wait” meeting. One thing about real estate that people often miss as to Why You May Need An Agent is the perspective of my TWO clients was not the same. I remember the wife…due to have her baby in July…saying ideally she would like to be in a home by June. The husband finished her sentence with “…or July, or August…or next year…”

3) Given the husband and wife were not necessarily in total agreement there, not arguing…but not necessarily “on the same page” either, I asked to visit them where they were currently living. I don’t often do that when someone is in a rental…but I needed to test “by June” against “…or July, or August…or next year…”.

When I visited them in their small apartment and they showed me the dresser drawer where the baby would go IF they Waited…vs Buying now…the answer to “Buy or Wait” became CRYSTAL CLEAR!

So with renewed motivation and a price of $550,000 vs $450,000 we found “the home” for them to buy and made the offer on 4/26…only THREE DAYS from our “Buy or Wait” meeting. They closed on 6/10 as it was a somewhat difficult Bank Owned property.

Now…let’s revisit my client’s Buy or Wait decision and second guess it based on what has happened since.

They paid $550,000, 1.1 X Assessed Value (a green price in a blue area). They paid $215 per square foot. Now let’s look at what has sold there since they purchased a little over a year ago.

First, the other one on market at the time they purchased: Closed 5/29/2010 – just before their closing – sold for $587,000 – just over their max of $550,000. Multiple offers…they couldn’t make an offer on it due to price. It was assessed for slightly less (only $4,000) was smaller at 2,460 sf vs 2,550 sf. So even though the bank owned sale was troublesome…worth the effort. Not a huge savings…no “deep” discount for the bank owned home they purchased…but enough of a discount to make it a good “Buy Now vs Wait” option for them.

Recent Sale in Same Neighborhood: Sold in 9 days for $602,000 on June 8,2011 – assessed for $8,000 less than the one my clients bought last year – Sold for $244 per square foot vs the $215 per square foot my clients paid last year. It didn’t have anything better than the one my clients bought. It needs a new roof, does not have granite counters, needs the carpet replaced with hardwood floors in the living room and dining room…nothing more for that $244 per square foot vs the $215 per square foot my clients paid in June of 2010.

One house did recently sell for $540,000…but it backed up to Avondale Road…so…the relationship to assessed value and price per square foot is a non-issue, given backing up to Avondale Road is not “a comp”. Given they paid only $10,000 more for a house last year that is NOT backing up to Avondale Road…I’d say the Buy vs Wait decision has withstood the test of time.

One might say they could have waited 3 years or 5 years…well, we’ll look back on that in 3 years or 5 years…but the reality for most people is “Buy vs Wait” is usually a question with a max timeframe of a year to 18 months…not wait for 3 to 5 years.

Buy now or wait until next year…in Jan of 2008 = wait until next year. But since Feb of 2009…wait is not likely the answer…but buy WHAT is a huge question? Follow the process I have outlined in my 1), 2) & 3) up there…and you will find your best answer to that question for your family.

The Question Your Real Estate Agent Doesn’t Want You to Ask

Posted on August 5, 2011 by ARDELL

What is the question you need to ask your Real Estate Agent…that no one ever asks? Buyer Clients-1

Will you help another of your buyer clients buy a home…

that is perfect for me and my family?

MORE IMPORTANTLY…will you even take on a new client…

who has the same ojective as mine?

People often ask me if I am “taking on new clients” and the answer is yes…as long as you do not have the same objective as one of my existing clients. I have been wanting to write a post on this issue ever since an Agent stood up in a class I was teaching here in Seattle and said “I showed the house to NINE of my “Buyer Clients”…

What??? NINE of your Buyer Clients??? How the heck can you take on NINE clients…who all want the same thing, in the same place at the same price???

There’s a lot of talk about Agent Commissions being less, when the truth of the matter is that what we should be striving for is getting back to the reason WHY “we make the big bucks”. It is because we can only devote ourselves to the objective of a few clients at the same time, in order to eradicate any potential conflict of interest or dilution of our efforts on the client’s behalf.

I have a client who wants a condo in Downtown Kirkland for about $350,000…possibly a townhome in Redmond for the same price…but more likely a condo in Downtown Kirkland.

I have a client who wants to buy a condo 2nd residence/investment condo for about $125,000 in Kirkland, Redmond or Bellevue.

I have a client who wants to buy a primary residence for about $600,000 in the prime areas of Kirkland near Downtown.

I have a client who wants to buy a primary single family residence for $400,000 give or take (depending on condition of property) in Redmond…possibly Kirkland.

I have a client who wants to buy a primary residence in Seattle between the U-District and Green Lake for $500,000 give or take.

So the answer to “Am I taking on any new clients” is yes…as long as you don’t want the same thing as one of my existing clients as listed above.

When I speak with other agents…they wouldn’t dream of turning a client away…EVER. Which is why some of the lower cost “agent services” do not list “assistance with property selection” as one of their offered Buyer Agent services.

Most all websites say “CALL ME IF YOU WANT TO SEE THIS PROPERTY” without regard to whether NINE people will all call to see

the SAME property.

It’s really as simple as this. IF your agent will show the SAME house to more than one of their clients OR if they will even “take on” a 2nd client who has the same objective as you do, then they are a SALESMAN and not a true representative of your goals and best interests.

Ask the question. If you find anyone else who says “NO, I will not take on a new client who also wants the same kind of property, in the same place, at the same price as you do”…let me know.

It will do my heart good.

Why there is no “LATE” in Real Estate

Posted on July 20, 2011 by ARDELL

We all remember Tom Hanks in “A League of Their Own” and that great line “There’s no CRYING in Baseball!” That doesn’t mean it NEVER happens, that means it is not SUPPOSED to happen.

When it DOES happen it is usually a Joe Biden sized BFD!

Same goes for a Late Closing in Residential Real Estate transactions…with some exceptions. In a normal Residential Real Estate Contract, you put down Earnest Money WHICH YOU ARE SUPPOSED TO LOSE under certain conditions. People often don’t know this OR they forget this.

Most often agents probably don’t say “Oh, by the way you may lose that $10,000” while the buyer is writing the check. They just “assume” the buyer knows what Earnest Money is. Telling people they may lose $10,000 is just not something most agents like to say when someone is making an offer on a house. BUT if the day the buyer may lose it, is the first time they’ve heard of that possibility, the *chocolate* is going to hit the fan…and often does!

Earnest Money is the amount you ARE WILLING to lose if…

If you COULD NOT LOSE YOUR EARNEST MONEY we would not require Earnest Money as a “BINDER” in most Residential Real Estate Transactions. Still the minute the “you might lose your Earnest Money if…” situation comes up, people act like no one should ever utter those words. Odd…but true.

Buyers write those big, fat Earnest Money Checks without much thought to LOSING that money…until faced with the words “Your Earnest Money is NOW in Jeopardy”. Late closings enter that realm of possibility. Often that can turn into a “Let’s SHOOT the Messenger” knee-jerk reaction. But the reality is…someone, sometimes, has to be the bearer of that bad news.

So why IS the main rule “No LATE in Real Estate

Do you need a “fancy” Flyer to SELL a house?

Posted on July 18, 2011 by ARDELL

Real Estate, cost of doing business, is often blamed for why “we” need higher and highest Real Estate Commission levels. As a follow up to my previous post I will tell you what I am NOT “good at”. That should make Craig happy. 🙂

I am not good at Bullshit! I seriously am just not good at “flowery language” to describe homes I list for sale. Never was, and will never be, my forte. If you have ever seen over the top flowery language on one of my listings in 21 years…the seller of the house must have written it, because I am sorely lacking in that “talent”.

I am very good at making “the product” the best it can be before it hits the market. I am better at “staging it to sell” than a stager, because I use staging to highlight the home’s best features. I am not “decorating” the home. I am putting up signals to the home’s features. BIG DIFFERENCE that I can’t seem to explain to “home stagers”.

The staging follows the Home Flyer pattern as to Best Features of the home.

When Making a Flyer I start with a list of why someone would or should buy THIS house vs the others that are for sale of like-kind home style. This home happens to be a “split entry”. So I look at it in relation to other Split Entry homes for sale within a half mile or so. Distance is not the key as much as having enough comparison product. If I can get that within .25 miles…that may be all I need. If I have to go out a full mile, then that is what I need. I want at least 3 to 5 On Market similar homes to use as a benchmark.

Here is the list of my “competition” for this particular home and product. Since it is now listed, the 2nd one on the list is actually this property. There were two others on market when I was preparing the listing and working through this process that are now pending. One was listed at $254,000 and the other for $267,000, leaving mine positioned as 2nd in “the pack” with the bank-owned as 1st, as it should be. We are “ahead of the pack” but not as low as the bank-owned home. That is “correct placement”.

Here is The Home Flyer:

Todd Flyer Picture of

As you can see from the flyer, I totally suck at “flowery language”. No words like “oasis” or “vista” or “exceptional” or “stellar”…just the facts. I’m very Jack “just the Facts M’am” Webb in that regard. A shortcoming, yes…but just how it is.

I had to re-design as in “downgrade” this flyer template to a one page, one sided, Flyer. I was using that fancy 11 X 17 folder over 4 page $3.00 apiece style flyer for awhile…and reverted back to this simple flyer as has been my long time custom. They cost $.39 apiece to print over at MinuteMan Press. They don’t bleed and sweat and run as to the ink like the ones I might print myself on an inkjet printer.

I pay for the “upgraded never ending flyer box” so one can be in the box at all times, even if people take them all, as one sits in the plastic cover in the front so people can see it even if the flyers are “out”. I think that costs an extra $2.00 for the life of the listing. 🙂 The sign up and down costs about $60 or so. One fee up front for both sign up and sign down. I paid a little extra for the Open Sunday 1-4 Rider to go up with the sign, vs my placing it there myself, so that it was an immediate announcement.

I do two Open Houses two Sundays in a row, back to back, and put it on the flyer.

Often the picture of the front of the house is NOT on the flyer, as noted above, as the person holding the flyer from the flyer box is usually standing IN FRONT of the house. He can SEE the front of the house and nothing else. So if I have room for 6 pictures, I want him to see the key selling points that he can not see from where he is standing.

The #1 feature of this house vs the newer homes in the area is the lot size, the big yard, the privacy trees, and the outdoor deck. These are the things WE have that the new, slightly pricier, zero lot line houses do not have. So I have devoted HALF of the photos to that aspect of the home that they cannot see when standing out front.

Back to staging for a second.

That is also why I removed some of the curtains, most all on the back of the house, and decorated “sparingly” so the eye would be drawn OUT to our best feature

vs IN to some overly nice furniture.

I am drawing the eye to the best feature when staging…NOT “decorating” a house.

Next of note as to FEATURES we have that the others in the lower price range and some in the higher price range in the list in the link above do not have is a NEWER ROOF and all NEWER WINDOWS. Pricey improvements for a buyer to make after purchase if they buy the other house that needs all new windows and a new roof.

So THAT is the number one item (both included) on the flyer below the price.

Back to Staging. I have NO curtains so you can see the full framing of the newer windows and sliding glass door as curtains are “prettier” but curtains cost ten bucks and new windows and sliding doors cost $4,000 bucks or so. So I want you to see the windows…NOT the “pretty curtains”.

You see how “staging” follows the Flyer as to Key Selling Points of the home. The staging highlights those features…it does not “decorate” the home. It UNVEILS the best Real Estate FEATURES of that home. You are not buying “the pretty furniture”.

Yes a cute rug would be pretty in the living room, but I am selling the hardwood floor, not a pretty area rug.

So there’s my weakness…I can’t talk about “Welcome home to your OASIS close to Freeway Access”. I don’t know if this should be YOUR home or not and I don’t know if you need an “OASIS” to run off to after work. I don’t know you at all. You are someone holding a flyer whom I will likely never meet.

I don’t want to tell you WHY YOU should or should not buy this house. I just want to talk about the house and it’s features, and make it easy to SEE those features if you come inside the home.

It’s my shortcoming…and I really don’t know what to do about it. But most of my listings sell in less than 90 days when I do this well, so I’m going back to doing THIS as I do it best. Blunt…straightforward, no flowery language.

Do Fancy Flyers with Flowery Language sell homes? I don’t know. You tell me.

Why Agents Are Better than Lawyers

Posted on July 11, 2011 by ARDELL

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Craig’s written a few posts about Why Lawyers are better than Real Estate Agents. Seriously?
Are you KIDDING me???
I usually don’t post before pictures of my listings, but this seller gave me permission to do so.

People don’t know what we do. because it is PERSONAL. What we do for our clients is never known until someone who thinks this business is EASY walks a mile in our shoes. THIS is what I do BEFORE I even START! The Listing won’t even be in the MLS until Wednesday.

I clearly EARN every penny I make, and not ONE of my clients have ever disputed that. I have never had a client who thought I “made too much” when representing them either in a purchase OR a sale in 21 Freaking YEARS!

Every day (and today on my most recent post) someone says agents do NOTHING.

Well I don’t call THIS nothing. It took day after day and many hours. Because I can’t “market” a home until I have a home “to market”. This is a $250,000 house and I am only charging 2% (because it is a 2X past client).

If you hired an agent who did NOTHING…
well, come on guys, whose fault is THAT?!?

BEFORE:

AFTER – Not finished yet,

have another full day tomorrow.

NO…this is not a vacant home…This is what it looks like today before it is finished.

Even staging the Linen Closet, the kitchen cabinets, the patio set out on the deck…you name it. Closets…anything a buyer will open and look inside.

And then some PISSANT will come along with a “Bad MLS Photo” post and complain that the light fixture is reflecting in the sliding glass door.

Don’t get me wrong…the seller is working his fingers to the bone too! This kind of transformation does not take ONLY one person. But I even personally, hand made the wall hanging in the dining room. I didn’t have anything “in stock” that was quite right and I wanted the largest 42″ X 42″ piece. I had this one:

But I wanted a “mid-century modern” feel, so I went to the cloth store and covered it with this:

And then I made a “Companion Piece” in cloth of the same colors and different design, and found the “starburst” mirror for over the fireplace that matched the circles in the cloth in the larger cloth covered.

If you are an agent who runs in with your cell phone and takes a quick picture of the open toilet and toilet paper…THIS is what we DO or “cause to happen” and WHY we make “the big bucks”.

And oh…

BTW…

I didn’t see any LAWYERS in Joann Fabrics on 4th of July Weekend.

If you are one of my other clients over the last week or two who thought I looked a little tired…this is why. 🙂 A VERY rewarding business…and there is NO END to what “we” DO!

We do whatever it takes to have a successful client.

Which Tattoo Should I get? Pink Pony? Cheerleader?

Posted on July 9, 2011 by ARDELL

My daughter, Andrea Revenant of 3rd Street Tattoo in Hermosa Beach CA, is having their Grand Opening Party today. The Federal Appeals Court has ruled that Tattoo’s are protected under Free Speech and that has opened the door for her to work in her current “hometown” of Hermosa Beach. I’m very happy about that.

Andrea Revenant

Andrea will “design” the final tattoo, so we’re only looking for general ideas here. I have NO tattoos, but when your daughter is an “artist” you should wear her “art work”. Or so I say. 🙂

#1 PINK PONY of Seattle Bubble plus Rainbow.

pink pony

#2 Cheerleader (aka Real Estate Broker)

cheerleader

#3 AskARDELL.com

I may add more before I fly down to L.A., and I will get Andrea’s input and she may send some sketches to replace the ones above before then.

But what say you? Have a favorite or a new suggestion?

Where will the Tattoo be? In a place that is visible but also in the least painful place to get one. Not sure about the pain factor. Will be getting some input on that as well.

As always, your help appreciated.

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