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Worried about resale value?

by John Rice
I sold a house to a very cool family I have been working with for a while.  We’ve looked at a lot of houses and I have become pretty close to them.  We always have a great time looking at houses and talking about our favorite Lexington restaurants.
But this post isn’t really about all that.  I just wanted to give you the background.
This family has owned several houses before.  This is the first one using me as their realtor.  The last two they ended up selling for less than they paid for them.  Granted, that happened to a lot of people between about 2007 and 2012.  They are understandably nervous about it happening again.
While I don’t have a crystal ball to predict what will happen in the future, I told them I thought they would be in good shape with this house.  Why?  Because the value of their new house is right smack in the middle of the range for the neighborhood.  That is always a safe place to be.
This house is in Hartland.  The range in Hartland is between the low $200s all the way up to over a million.  Most fall in the low $300s to mid $400s.  When you think of Hartland, it is the houses in this range that pop in your head more so than the ones under $300k or over $500k.  Which houses in this (or any other neighborhood) do you think would be the hardest to sell?  It is the cheapest and most expensive ones.  See, somebody looking at the low $200k house might be thinking that they could go to a slightly less fancy neighborhood and get a better house for the same money.  The buyer in the high range for the neighborhood is thinking they might want to be in a neighborhood with more houses in their price range.

Any neighborhood has a range of values.  Most don’t have as wide of a range as ones like Hartland, Chevy Chase, Ashland Park, Greenbrier, etc.  Even if you are shopping in a neighborhood with a narrower range of values, you are usually best to stay away from both the lowest and highest price houses.

So I think my special family is going be just fine with the house they have picked!

Great Time to Downsize/Retire in Lexington

by John Rice

It is always a good time to be in the market for somebody.

A few years ago anybody moving up had it made.  The price of their old house had dropped, but the price on their move up house had dropped even more.

Today, the winner is the buyer who is downsizing.   Sure, the house they want to buy is worth a lot more than it was a few years ago, but so is the house they are selling.

I’ve worked with several buyers who have been empty nesters or retirees.  Some already lived in Lexington.  Some have moved from out of state after discovering Lexington is a great place to retire.

Almost all of them want a ranch house less than 2000 square feet.  Some want an older house for the character.  Some want a newer house for maintenance free living.  Some have considered a condo, but none have bought one (yet).  They all have wanted to be close to shopping/dining/entertainment as well as health care facilities.  Many of them have family spread out in different states and tell me they like how Lexington is two hours to their grandkids, or 3 hours in the opposite direction to other family.  Guess having two interstates with Lexington in their crosshairs helps.

It is a lot of fun to work with these buyer, and it sure is a good time to be one of them!

The LEXpert’s Thanksgiving post

by John Rice

Thanksgiving time again.  One of my favorite holidays.  I like all holidays really, but the thing I like most about Thanksgiving is that everybody can participate and it is a pretty laid back holiday unless you’re doing the cooking.

I woke up today thinking what I was thankful about.  Lots of things popped into my head, but one thought really stuck out to me.

I’ve always wanted to be in real estate.  I almost got into it back in about 1999 but I wasn’t able to make the jump.  You need some reserve income to jump into real estate.  It can take a while to get off the ground.

I was again thinking about real estate in 2003.  The mother of an old high school friend was a realtor and she was doing really well.  I was a little hesitant to pull the trigger, but then Francis said she would pay for half of my real estate school.  That was over $500.  That was a huge amount to me back then.

What Francis did not realize (or maybe she did?) was that she had effectively removed the last justifiable reason I had to not get my real estate license.   Since I was left without an excuse, we went to the real estate school.  I plopped down my half.  She plopped down her half.  The rest as they say, is history.

I’ve always been appreciative of her for doing this, but until this morning I thought it was about the money.  I now do not think it was about the money.  I think she saw my potential and it was about getting me there.

I have had an incredible time the past 10.5 years since I got my license.  I get to talk about houses and neighborhoods all day.  I don’t have to tuck in my shirt.  I get to be out all over town.  I get to wear sandals everywhere.  I get to meet a lot of people.  And I get to wear sandals everywhere.

A lot of people have helped to get me where I am today.  My parents.  My wife.  Everybody who has ever bought or sold a house through me.  All of you are very important to me and I am thankful for all of you…..especially Francis, who was at the right place at the right time and did the right thing.

To Francis and anybody reading this….have a happy Thanksgiving!

Will a Selling Bonus help sell your house faster?

by John Rice

I recently had a somebody ask me if I thought it would help their house sell faster if they offered a “Selling Bonus” to the buyer’s agent.

My answer was no.

Selling bonuses use to help back in the days when realtors were the only ones who knew what houses were for sale.  The thought was that you could entice a greedy agent to show and sell your listing because they would make more money.  Today, it is usually the buyer who tells their agent what houses they want to see since they have access to all listings (and thanks to some sites that are not up to date, they also have access to houses that WERE for sale and are no longer available….but that is another blog post.)

Know what I told this person?  To reduce their price.  If they were willing to pay more commission to an agent, why not lower the price by the same amount and offer it to the buyer?

Offering a selling bonus does one thing today:  Since the buyers have access to all listings and pick what they want to see, a seller is really just giving extra money to the agent of the buyer who would have bought the house anyway.

When I show a house that has a selling bonus, I always make a point of telling my buyer before we see it.  Should they end up buying the house, the last thing I want is for them to think it influenced my advice to them.

One of the best sellers I’ve seen

by John Rice

I always say you see people at their best or their worst in a real estate deal.

I closed on a house last week.  The seller had lived there for 28 years.  I saw her at her best.

Most people do a few nice things to make it easy on the buyer…..like labeling the keys, cleaning the house, mowing the yard right before the closing, letting them know when garbage day is, etc.  This seller did all that and more.  She had a list of everybody who she used to work on the house.  She mowed the grass right before the closing.  She even cleaned out the gutters the night before the closing.

She told me afterwards, she had gone over to the house and had prayed for the house and the new owner.  Now, regardless of what you believe, you have to admit that was a very caring thing to do!

As we left, I told the seller that not all transactions are this smooth.  She had not bought or sold in 28 years.  She was amazed that some deals can get rough.

Working with this exceptional lady sure made up for the time a crazy lady got so mad while talking on a cordless phone to her loan officer, that she threw the phone down on the closing table and I had to dodge it as it flew across the room.