Relocate With Jen: July 2009

 

Many of you know that I recently bought a home. 

And, for those of you that don’t know that I recently bought a home…I recently bought a home.  Here’s proof.  

Although we are very happy with our home we did purchase, during this process, I happened to notice that as we viewed house after house, I kept seeing the same things happen over and over.  And….not good things.  Bad things.  Bad things that were blatantly obvious to me.  Bad things that literally turned me off.  Bad things that were keeping this otherwise fine house I was standing in from selling faster.

So, as we went through the homes, I started keeping track of things that I saw that made the average buyer – ME – want to run away screaming.  Here is my “Top 10 Seller Sins”:

1. Addition Addiction – Ok…exactly what were these people thinking when they added this addtion to their home??  It isnt level.  The door frame isnt square.  And, that simulated wood-grain indoor/outdoor burber carpeting is HIDEOUS!!  Wasn’t this were the garage should be anyway??  I guess that explains the severely sun-faded paint job on the Sport Family Truckster in the driveway and the Christmas decorations piled floor-to-ceiling in the closet in the spare bedroom.  I don’t care what anyone says…Bigger is NOT always better.

2. The “Pet-Owner Moaner” – The over-all assumption that since the seller loves their pets more than chocolate, so does everyone else.  Here are a couple of quotes I heard directly from the sellers mouths: “Awwww, my cat must really like you to nestle into your neck like that.”; “I know he looks big, but he is really just a teddy bear.”; “We were able to clean up everything in the house except the cat room.”; “I cant remember if my son put away the ferrets or not, but feel free to look around downstairs.”
a.  Ok…first and foremost, Im allergic to cats.  I don’t mean that cats make me sneeze.  I mean that I quit breathing and require adrenallin shots to keep from dieing.  That thing is lucky I didn’t toss it out the open window that was next to me. 
b. The “teddy bear” they were referring to…Yeah, that was a 158lb Rotweiller with a googlie eye and a broken tooth on the right side.  His chain was tied to a cinder block that he happily drug around and tossed into the air during “playtime”. 
c. The “cat room”???  Oh Lord in heaven!!!
d. If you cant figure out if your son left out a pack of rodents in the dark rooms down the creaky stairs without a safety rail and a working light switch, you can be damn sure Im not going to find out for you.

3. Auditory Unawareness – If you cant hear that your refridgerator is making a clicking noise that can be heard from the front yard, Im fairly sure you cant hear the floorboards creaking, the doors squeaking, or the apparent family of raccoons living in the attic.  You also only hear what you want to hear.  Instead of “Your house is priced too high”, you hear “Your house is of a high value”.  Its not the same.  Pay attention!

4. Color Blind – Holy Lord!!  Who decorated this place??  Its like Andy Worhol threw his color pallet into a Cuisinart and hit ‘liquify’.  The fuscia flower print wallpaper needs to go.  And, I don’t carew what you say, it doesn’t do any justice to that wall with the fake woodgrain panelling it joins up to by the sunshine yellow couch.  Worse yet…the white cabinets, white-washed walls, white countertops, and white tile is just a bit much. 

5. “Take it or leave it” – Yup.  Heard that come right out of a seller’s own mouth.  We were discussing the possiblity of him making a necessary repair to a sliding glass door that lead out to a deck.  Between the glass panes was about half an inch of standing water.  Obviously, the seals on the window were compromised.  When asked if he would spend the money to get the glass replaced and the seales re-done…or just replace the entire door…that was the response I got.  Guess what…I left it.

6. Price-itis – The fear that your home wont sell for the price you are asking for it.  I put in an offer on a home that was only $5,000 under what was being asked.  The counter came back with a reduction of $1,000, but a clause to pay $4,000 in closing costs.  Now, I may be bad at math…but, isnt that the same damn thing???? 

7. Fried Food Funk – You know what Im talking about here.  If you can smell it, you won’t sell it.  Bottom line here is that fried food smells, kitty litter, a back yard filled with dog crap, a nursery reaking of dirty diapers, etc…all add up to one thing – a very short showing.  (Well, it also leads to gagging, shortness of breath, tears streaming down your face, and everyone skrunching up their nose and making that internationally known face that says, “Do you SMELL that???”)

8. Photog Fog – Everyone should take pride in their family photographs.  I do.  But, Im not trying to sell my house!  I went into one home where, I kid you not, the entire living walls…every square inch…was covered in frame pics of family.  There must have been 100 pictures in that room.  Frames mounted together like a patchwork quilt of memories and bad matting jobs.  Love the sentiment…love the family pride.  But, I was COMPLETELY distracted from seeing the actual house. 

9. “I collect them” – No kidding, really???  Nothing would have made me realize you collect dolls were it not for the fact that Im now suddenly very aware of the fact that 226 eyes are now following me through your house like Chucky with an ax to grind.  Yeah, I couldn’t tell that you collect Vegas casino ash trays since they are on every flat surface in your entire house including 4 separate 6-ft tall bookshelves, your coffee table, the top of your TV, the end-tables,  and the extra two shelves that you put up encircling the entire living room.  But, worse than that, you have them on your toilet tank, your dresser…and in an amazing twist, you have drilled holes in them and replaced half of the doorknobs in your house with them.  In case your agent hasn’t told you this….PACK THIS CRAP UP!

10. Livin in the past – I don’t care what you think, the pea soup green shag carpeting is not coming back in style.  And, regardless of how many memories are associated with it, the nine-foot long, hunter orange, faux-leather couch on the wooden legs with the sleigh-style arms on the each end is FREAKING UGLY!!  Regardless of whether or not they still work, the matching avocado green stove, fridge, and counter tops are ugly…and they are ugly 24/7/365.  If you want to move this house…replace this ferocious eyesore.  Better yet…HIRE A HOME STAGER!

Yeah, selling a house is hard.  Selling a house in the market is harder.  Selling one of THESE houses with a seller that sins like this…nearly impossible.  Sellers, if you are reading this…listen to your agents.  Agents, if you are reading this…make sure your sellers understand that buyers – like me – will look at these like neither of you know what you are doing and act accordingly.  Probably by running away quick.

 

 

 

If you would like more information about Real Estate Client Referrals and how we can send you more clients to work with, please contact Clint Miller at 800-977-7058.  Or, follow me on twitter www.twitter.com/TheRealClint.

If you've ever bought a home and found it remarkable that the property appraised for just the amount it was listed for, there may have been more than coincidence behind the matching numbers. Loan officers learn quickly which appraisers are generous in the valuations and which appraisers are vulnerable to pressure from a lender.

Now, the government has stepped in with a new set of regulations designed to end collusion of any sort between lenders and appraisers.

Some people believe a big part of the mortgage mess we're in was caused by inflated home appraisals. Mortgage brokers and banks have been accused of pressuring appraisers to assign valuations to fit the loan so that home purchases and refinancing applications would go through, rather than allowing appraisers to determine a property's value independently, free of influence from lenders and real-estate agents.

No more. New federal regulations known as the "Home Valuation Code of Conduct" (HVCC) take effect May 1, 2009. And while they are designed to bring transparency to the home-loan process, they also may end up increasing consumers' costs for an appraisal.

Silence Is Golden

These HVCC rules require that mortgage lenders and banks refrain from communicating with appraisers on any loans that eventually will be sold to Fannie Mae and Freddie Mac. Fannie and Freddie, as you may know, are corporations chartered by the U.S. government to purchase mortgages and keep a stable supply of money available to lenders for home loans. They are huge -- Freddie Mac purchased one loan every 10 seconds in 2006 -- so the new rules surely will impact many home loans. Fannie and Freddie have each come out with statements about the HVCC rules.

So who will take over the role of assigning an appraiser to evaluate a home? A third-party -- an appraisal-management company -- will handle this task... for a fee, of course. It is this part of the HVCC that has appraisers more than a little upset, and some industry professionals believe many experienced appraisers will leave the business. I suspect the cost of appraisals will increase to compensate the appraisal-management companies, one more way the fees associated with buying a home will rise for consumers.

For more information about the HVCC, check out this document from the Washington, D.C.-based Appraisal Institute.

The Skinny on Agent Commissions

Speaking of real estate and fees, one of the most interesting bits of information I have learned in my current marketing role at a real-estate brokerage concerns how commission works and... this may come as a surprise, how little money many agents receive from a transaction.

As anyone who has sold a home knows all too painfully, the commission, which usually adds up to thousands of dollars, is paid by the home seller. It is usually a percentage of the final sales price on the property, and the amount is split between the agent representing the seller and the agent assisting the buyer.

The split between the two agents usually is 50/50, though not always. Some agents will offer a higher commission to "the buy side" as an incentive to encourage agents to show the house (commission to the buy side is shown in the multiple listing information for a property.)

Likewise, some agents will shortchange the buy side because they need to bring a certain percentage commission -- say 3% -- to their brokerage. If they have listed the property at 5% commission and split the commission 50/50, or 2.5% to each side, they may have to make up the half percent out of pocket, which is why they may keep 3% for themselves and offer 2% to the buyer agent. The brokerage I work for has a policy stating that all commission must be split 50/50 between agents.

Not the Payoff You'd Expect

Before I worked for a real-estate company, I thought agents collected and kept most of the commission from a transaction. I didn't realize that they share a large part of their commission with their brokerage office; that they pay most, if not all, of their marketing expenses; and that there are various recurring fees they must pay monthly and annually. In sum, an agent's earnings don't add up as quickly as you might think.

Here's an example based on the sale of a $300,000 home with a 6% commission and an agent who splits his or her earnings with the brokerage on a 60/40 split:

---

Total commission paid (6% of sales price): $18,000
- Buyer's agent's 50% gross: $9,000
= Listing agent's gross: $9,000

- Brokerage's 40% split: $3,600
= Listing agent's share: $5,400

- Franchise or office transaction fee*: $324
- Marketing fees**: $1,000+
$4,076

* most offices have some version of this; my company has a 6% royalty fee
** photography, sales brochures, signage, print ads, online listing fees, direct mail, open house catering, etc. (varies by listing)

---

That $4,076 is a nice paycheck but a far cry from the $18,000 the seller paid. Remember, too, like everyone else, real-estate agents pay income tax, so that will cut into the total takeaway as well. If this listing required many showings, was on the market for an extended time or required extensive negotiation to bring it to settlement, you can see that an agent's hourly wages could diminish significantly.

Commission Is Negotiable

Finally, if there's one thing to remember from this column, it's that the commission rate is negotiable. Repeat after me: Real-estate commission rates are negotiable.

Whether or not an agent will agree to list your house for less than the usual commission rate of course depends on a variety of factors. They range from the perceived difficulty in finding a buyer (not surprisingly, commission rates hold up pretty well in a buyer's market such as the one occurring now in most of the U.S.) to what competing firms in the local market charge to whether the sales manager or company owner will chew them out if they accept a reduced commission. And some agents are so busy that they simply refuse listings if the seller won't pay full commission.

-- Valerie Patterson oversees all online and print marketing efforts at Kurfiss Sotheby's International Realty, a privately-owned real-estate firm based in the Philadelphia area. Prior to joining Kurfiss, she was the producer of The Wall Street Journal's free real-estate site, RealEstateJournal.com.

On Tuesday, I wrote about Niche Markets from A to Z...the first of 2 key elements of succeeding in niche marketing.

The second element is connecting with with the niche market.

Here are 10 ways of doing just that.

1. Conduct a survey in your niche from your market niche research of your market, select a topic of interest go door-to-door, one neighborhood at a time to 'interview residents' about their opinions abut this topic, using a standard questionnaire.

Ask residents if they would like a copy of your e-report. Collect the contact data data of thjose who say yes and add these people to your network of contacts.

2. Write an E-Report about your findings distribute copies of your E-Report to local media, business & community organizations and interested residents

3. Volunteer to help with a kids' sports team DO NOT act as umpire or referee...you are sure to annoy somebody.

4. Network with others who serve the same kinds of clients you do For help with your networking, click here.

5. Establish a network of referral partners to learn more about referral partners, click here

6. Join & actively participate in a local business group for help with networking in this group

7. Join & actively participate in a local community group or organization for help with networking in this group or organization.

8. Join a local worship or religious organization join because if and only if you believe in and support the organization's beliefs. DO NOT actively promote yourself and your service

9. Write a community-focused blog do whatever you can to engage and connect with your readers 

10. Develop a community website to learn more about community websites, click here. Invite the people with whom you have connected in items 1-9 to work with you on your community website