Heather's Bucks County Real Estate Blog: January 2008

I caution all my Buyers:

• When you tour the home - you'll love the house.
• When you put the offer in - you'll love the house.
• When you're negotiating the offer - you'll love the house.
• When the offer gets accepted - you won't want the house.

I caution all my Sellers...

• When you have your house on the market - you'll be willing to sell for $X
• When you get an offer in - you'll be willing to sell for $X
• When you're negotiating the sale - you'll be willing to sell for $X
• When you sign the Agreement - you'll think you gave the house away.

It's completely natural to have almost instantaneous remorse the minute you execute the contract.  Be aware that it will happen and realize that it's just a temporary pang of unease because this is such a huge undertaking.  In a day or two, and especially as settlement draws near, you'll be satisfied (and happy) with your decision again!

Below are two pricing cues that I use to gauge my pricing on listings in Bucks County, PA.  In general, I think these are good guidelines to follow for Bucks County.  All real estate is local, however, and these standards may be atypical of other areas.  But for Bucks County, I look for:

• 10 showings in 10 days.  If you haven't received 10 showings in the first 10 days on the market (and there was no holiday to impact showings or something of that nature) you need to take a look at your marketing and pricing. First take a look at your marketing - do you have the maximum photos in the MLS (and are they good photos)?  Is your listing on realtor.com, zillow.com, craigslist.org, and has it been syndicated to Trulia, Google, etc?  Is your realtor.com listing enhanced with custom verbiage? How many hits is your listing getting online? If everything looks good on that end, you probably need to adjust the pricing.  The first two weeks on the market are the time when your property is "hot."  Don't waste them by under marketing or overpricing. You can't sell it if Buyer's aren't looking at it. 

• Lots of showings but no offers or interest.  Now, this is a bit open to interpretation because Buyers are taking quite a bit of time to go from interest in a property to writing an offer.  However, if you have 20 groups through your house, and it's not on anyone's short list, you need to adjust the pricing.  It means your marketing is working, but you're still priced just a touch high. The good news is that a price adjustment sometimes spurs these "on the fence" Buyers into action, and you may end up with a hot property with lots of interest.

If you have a lot of continued activity, generally positive response, and some nebulous Buyers waiting in the wings thinking about your home, stay the course for as long as seems reasonable.  However, if you see prices starting to fall in the area, I would consider a price reduction in order to revitalize the listing and spur some offers.

In my last posting, I warned against some things that implode transactions.  Let's take a look at some things that keep transactions on track and moving forward:

1.  Follow up.  My motto is "I trust everyone to do their job.  I just call a lot to make sure."  Follow up on your mortgage lender, the township, the contractor who is supposed to be doing your repairs, even - your REALTOR (R)!  I don't like to consider it nagging, I like to consider it touching base. If you call often and early, you always have a better chance of rectifying any problems that would impede your settlement. 

2.  Do what you say you're going to do.  If you've agreed to repair something, don't get caught up with moving and not do it.  The Buyer is going to want some money for it at the table - and I guarantee it's going to be more than what you were going to spend on it.  If you say you've made mortgage application, you better have done it.  It's very, very easy to get caught up in packing your stuff, or picking out paint colors, but you need to get the "work" done.  It doesn't matter if your heart isn't in it, and you're emotionally connected somewhere else.

3.  Keep good records.  Keep your Agreement of Sale handy.  Keep your mortgage paperwork handy.  Keep receipts for repairs handy.  My advice is to start a file folder and staple some lined paper to the inside front cover. Keep a call log of the date and name of everyone you talk to and a short note on the conversation.  Use email as much as possible to document.  If there is a problem that crops up, you have the information on hand to take care of it.

And then it's smoooooth sailing right through the settlement. 

Despair is most often the offspring of ill-preparedness

Don Williams, Jr.

122 Elderberry Drive

Levittown, PA 19054

$280,000

This gorgeously renovated 1,600 sf home features 5 bedrooms, 2 full baths, formal living room, and great room.  Packed with high end fixtures and features not often found at this price-point, this is truly the cream of the crop. 

The kitchen features maple cabinetry, granite counters, 16 x 16 tiled floor, and a knockout tumbled marble backsplash.  The stainless steel appliances include dishwasher, five burner smooth top stove, and built in microwave.  Plenty of room for your refrigerator, and maybe even a bistro table! The baths are new.  The first floor bath features a marble tile floor, Euro-vanity, tile tub surround with accent tiles and new commode.  The second floor bath features a whirlpool tub, subway tile surround, tile floor, and new vanity and commode. 

Other new features include: windows, siding, doors, drywall, paint, carpet, hot water heater, HVAC (electric heat pump/central air), and baths.  Please join me on Sunday to tour this gorgeous home!

Please visit our website at www.122Elderberry.com for additional information, photos, and a virtual tour! 

I'm baring my soul (and my kitchen) below. How you live in your house, and how you sell your home are two different things. I took pictures of my kitchen exactly how it looks after a frenetic weekend with the kids, and a hectic morning getting them all off to school. I'm sure many of the rooms in your home look just like this. (Right??? Don't they?) This is what a well lived in home can look like, and I gave myself 10 minutes to get it show ready.

Ready...set...go!

To be honest, most of this was just putting things back where they're supposed to be, but it also entailed clearing some small appliances off the counter, clearing off the refrigerator, and hiding my "lunch station" (bread, peanut butter, sandwich bags, etc) in the pantry.

Some other ideas of how to live to quickly stage a home:

• Pack all toys except what fit in a storage container. When you have a showing, throw all the toys in the container, then put the container in a closet.
• Institute "no eating and drinking" rules except in the kitchen until the house is sold (that goes for messy husbands, too).
• Delegate one bathroom for all usage. You only have one to worry about before showings, and the others should remain clean.
• Declare rooms "off limits" to everyone. If they don't sit on the couch - you won't have to fix the pillows before the showing.
• Do a "final walkthrough" before leaving in the morning. Carry a trashbag with you and put everything that you don't have time to put away into the trashbag. Empty the bag when you get home that night.

Want some more tips? Shoot me an email and I'll send you more ways to "live" while "selling." Also, checkout Flylady.net for some great systems on how to keep you home clean and clutter free (obviously, I'm only a wannabe Flylady - just look at my kitchen!)

There are several things that you can do to implode your real estate transaction (whether buying or selling). Here they are:

1. Work with the wrong people. There are many people who have a hand in getting you to the settlement table, including, but not limited to: REALTOR (R), home inspector, mortgage company, title company, township U&O personnel. Some, you have a choice in who you work with, others you have to work with who you get. Any of these people can kill a deal. Make sure that you surround yourself with good people on your end, and hopefully they can compensate for the others you can't control. How do you find them? Get recommendations.

2. Be driven by emotions. Notice that I didn't say "get emotional," because, trust me, you're going to get emotional. I said driven by emotions. Price negotiations, home inspection repairs, differing opinions of what "clean" means - they all will trigger an emotional response. Accept the reaction, take a deep breath, sleep on it if you have the time, look at the big picture and make a reasoned response. Don't sweat the small stuff. Things that seem catastrophic in the heat of the moment usually have workable solutions.

3. Bully during the negotiations. I'm an excellent negotiator. Know why? Because I don't sell the other party. I don't badmouth a Seller's house when presenting the offer, and conversely, I don't tell Buyers how lucky they are to get a house at a specific price. I negotiate the price/inspections/repairs in a straightforward manner without fanning the flames of the other party. It's always counterproductive to do this. Always. I've never had someone take a $10,000 off the price of the house because I told them it was a dump and they were lucky to get an offer in the first place. I have, however, negotiated $10,000 off a price by saying that was the max my Buyer could offer, and we could settle quicker if that helped the Seller any?. This doesn't make you a pushover, and I've stepped up to the plate and said, "No more. It's this or we re-list" but never start negotiations with an opening salvo to the other party.

Now that I've listed what you shouldn't do during a real estate transaction, look for my next post on what you should do to keep your transaction on track...

There was an interesting article on MSN Money regarding twelve principles which make a house somewhat "Recession Proof." You can read the article here.

If you're looking to purchase, now is a really good time to actually take a look at factors that negatively impact property value, and buy a home accordingly. I'll give you an example...

There is a house in Langhorne currently listed well below market price for the neighborhood. It's been on the market over a year, and continues to languish on the market. Why? Because it backs up to Rt. 413.

Now, two years ago, that house could have been sitting on the edge of a cliff, with the turnpike running through the front yard, and it still would have sold. Buyers were lucky to get the opportunity to actually write an offer before a home was sold, so many of the most basic principles of value were tossed to the wayside as Buyers scrambled to find something...anything...that they could get under contract.

In the post-crazed real estate market, a Buyer has the opportunity to step back, take his or her time, and buy smart. If a home has been sitting for a year? Chances are you can figure out why, and if it's not pricing or something "fixable" it's going to impact YOU when you go to sell. The market is speaking to you - listen to what it's telling you.

Location is the number one consideration when buying a home. School District is next. These will have the most impact on your resale and the property's value going forward. Buy smart, and you can better weather any shifts in the real estate market.

My last few listings have had well under the average days on market (the last two were sold in under 30 days).  While I don't have a magic bullet, I do have some smart, common sense strategies to get your home sold fast.

1.  Pricing is key.  KEY.  You want to have a really good market analysis, and not one of these "Oh, here are five 4 bedrooms that have sold in the last 6 months." kind of analysis.  You want adjustments made for amenities, lot size, condition, fireplaces, A/C, etc, and comparables from the last 3 months.  You want to take a look at your competition in the marketplace.  Then you have to resist the urge to overprice your home by $5,000 to "leave room for negotiating" and price your home so that it's a tremendous value for the price range.  Compared to the other 4 bedrooms on the market?  Your home is the only one priced right, and because everyone else inflated their price by thousands of dollars for "wiggle room," you're usually also the lowest priced.

Doesn't this leave money on the table?  Nope.  Remember, you're pricing your home where you think it is going to sell, thanks to a thorough market analysis.  You're leaving out the "wiggle room" and effectively out-pricing the competition.  You're getting more Buyers through your door and creating a sense of value. It's a completely different mindset from "How much are they asking?  Let's let it sit until they reduce it."  It works.

2.  Don't hit the MLS until you're prepared.  That means that all the little repairs have been made, the house is staged, and the photos and virtual tour are ready to go.  For my clients, I will not enter a home in the MLS until I am ready to load the maximum number of pictures immediately.  No pictures, or one picture of the front of the home is the kiss of death in my opinion.  You may as well have a flashing neon sign screaming "Dump" next to your address otherwise.  No pictures means something is wrong.

Can't you load them in a day or two?  Nope.  I think you have one chance to grab that Buyer (and a good agent will have Buyers set up to get listings automatically as they hit the MLS).  There's an excitement to "Oh, an email from my REALTOR! I hope this is a good one! "  If there are no pictures, there's nothing to get excited about. Who knows if they'll ever re-visit the listing to see your interior shots.  If they do, much of the excitement of the "new listing" will have worn off.

Get your marketing strategy together (and it better be a good one) and get it ready to go before the first day on the market.

3.  Look at the big picture.  If you are looking to sell quickly, you can't get caught up with a couple hundred (maybe thousand) dollars, or keeping your washer and dryer, or stubbornly refusing to fix a leaky faucet because, "It's not a big deal."  Take a step back, think about your priorities, then move forward accordingly.  Price is just one aspect of a deal, and there are many others that often affect your net proceeds.  How about a full price offer with a 3 month settlement, as opposed to one $2,000 less with a 30 day settlement?  Carrying charges may make the second offer more financially advantageous.  Your washer and dryer?  Put a dollar amount on them and see if the deal still works with you throwing them in.  Make the repairs the Buyer calls for, even if they're stupid, but cost little to repair.  

I'm not saying to throw in the towel and bend to Buyer's every demand. I am saying to work with them, especially if it's helping you along to where you want to be. Don't let ego, or hurt feelings, or anger implode a deal that you want to see go to settlement.

If you're selling in Bucks County, I'd be happy to complete a good market analysis on your home.  Shoot me an email if you'd like more information...

If you have a property to sell before you buy, many Sellers in Bucks County struggle with whether to buy or sell first.  Ideally, you can coordinate the settlements back to back and there is no difficulty in getting the proceeds of your home sale to move forward with your purchase.  Ahhhh, it's so lovely to have things work out.

But it doesn't always work that way.  Here's a quick snapshot of the risks and rewards of selling first, or buying first:

Sell Your Home First

The drawback is you may not find a property that you like and have to move in with family or temporary housing for a while. This could wreak havoc on your life, especially if you have kids in school, and you'll incur storage fees for your possessions. The reward is that you know exactly how much money you are getting from your home sale, can make offers without a home sale contingency, and don't have the stress of carrying two mortgages.

Buy Your Home First

The drawback is that you may be inviting financial disaster.  You may either have to carry two mortgages for an extended period of time OR you may have to fire sale your house and not realize the equity you thought you were going to get.  The benefit is that you have the luxury of working on your new home prior to moving in (painting, etc), can move your possessions in at your leisure, and any children only have to move once.

What's my recommendation?  It depends on your financial situation. Some people can carry two mortgages without financial ruin, or have a lot of equity where a $10-20K hit isn't going to make or break them.  However, if you're not in that group, I would sell first, and ask for an extended settlement of 4 months to give you time to find a home.  There is a ton of inventory on the market and you have a good chance at finding your home quickly.  However, my last few home sales have been under 30 days on market, so it can be done.

How do I get it done?  Look for my next post where I'll run through it...