Selling in 3 easy steps (& 7 things NOT to do!)

by John Rice

A life long friend of my family asked for advice on selling her daughter’s house as quickly as easily as possible. Check out what I told her about price, condition and presentation:

“Price is the most important part of selling. Price it too high and no amount of marketing or quality pictures matter….it won’t sell. Heck, I’ve even seen poorly presented listings sell quickly because the price was accurate.

If she is going to list with a realtor, she should find one that does a lot of work in her price range. Ideally an agent that works with as many buyers as sellers. Agents that primarily list houses only see one house per client. An agent that works with a lot of buyers sees multiple houses per client. Seeing more houses (especially in the same area and/or price range) make the agent familiar with what is normal and how buyers will respond to her house.

I would price it slightly above the market value so it sticks out among the competition. The trick is to know within 1% either way what the house is worth. That is the hard part really. I don’t know what the market is like where she is. Around here, we try not to price them where there is a lot of room for negotiation. In some rural counties around us it is normal for a house to sell for way less than the asking price. Here, the average list to sale price is 96.5%. I usually get about 98% of my list prices because I can ((usually)) determine what a buyer will be willing to pay.

Next is to present it well online. She will want EXCELLENT pictures. I pay for a pro. It is well worth it. People make the decision whether to see the house or skip it based on the online presentation. It has to be done well. I try to find out what is unique about the property and write my description accordingly. People want to know what is special about a house, not that it has all the same stuff as every other house in their price range. If a house doesn’t feel special in some way, then there is no reason to come see it in person.

Then there is how the house looks when they get there. The house really has to deliver what the pictures and marketing remarks promised. There is nothing worse than a buyer who is let down once they get there.

The buyer needs to see something they like as soon as they enter the house. If the buyer likes what they see once they step in, they are more forgiving of things they see later that they do not like. If they do not like something as soon as they walk in, they are critical of everything. I see this all the time with buyers.

She will need to get the house ready. I haven’t seen the house so I have no idea what it specifically needs, but a deep cleaning, fresh paint, decluttering and fixing visibly broken things really helps to catch a buyer. If she can’t deal with many issues, work on the 2-3 biggest ones. You would think buyers would balance the good and bad, but they don’t. If there are a few major negatives no amount of positives will make them pull the trigger and buy it. I tell sellers there are two ways to do this unless it is just an awesome Seller’s Market. You either put the effort in up front and can usually sell quickly, or you leave your house on short notice for multiple showings, get negative feedback and no offers, then end up doing everything you should have done in the first place.

Turn on every light in the house and open every blind unless it shows an ugly view. Take out the garbage. Keep the yard looking good. New mulch is like paint for your yard….it really gives it a fresh look. Make the front door area look good since that is what the buyers will be seeing while the agent is trying to open the lockbox.

Some things NOT to do:

1. Don’t run the dishwasher or have laundry going during a showing.

2. Don’t cook stinky food before a showing.

3. Don’t play music. Often people with fancy audio equipment want to show it off. It is distracting to have music playing in every room.

4. Don’t put out potpourri or those nasty Glade plug in air fresheners. People with asthma will leave ASAP and everybody will wonder what odor you are trying to cover.

5. Don’t stay at home for the showings. LEAVE. Buyers always feel like they are crashing into your life if you are there and they will want to leave in a hurry. It is hard for a buyer to decide if they want the house when they feel like an intruder.

6. In case she will have the house vacant while on the market, don’t do something like keep the thermostat too high or too low. People that are too hot or too cold don’t stick around much either. And don’t turn off the water. Somebody will use the restroom and won’t be able to flush.

7. If she comes home and a buyer is still there, don’t run them off. It typically means they were running late or they are past their appointment time because they love your house and don’t want to leave. Drive around until they leave or park way down the road. Just don’t make them leave……it would be like a movie scene where two people about to kiss get interrupted.

That is about it. I needed to blog today so I may just cut and past this!!”

How adding a 2nd bath ruined a house

by John Rice

I went out with a client to look at houses yesterday. This will be the 3rd time this lady has used me. She is super cool and always likes interesting houses. After totally renovating an old house on top of a hill deep in Jessamine County, this time she wants to be in town. So we are looking at older houses around the University of Kentucky.

We saw several houses yesterday, but today’s blog post is about one in particular. This house was “Renovated” after being bought for just over half of today’s list price. The materials used were fantastic. The house was in in good shape. It was all going swell until we got to the 2nd bathroom. You walked out of the dining room into this space that had a bathroom sink. Beyond the sink room was a pantry and another room that housed the rest of the bathroom. Not the end of the world if that was all….but also off the sink room was the kitchen. So, to get to the dining room you had to walk through the sink room, which felt like that awkward area of some hotel rooms that have the sink outside of the bathroom. It pretty much killed any hope of this being “THE” house for my client.

When I go into an old house that has been remodeled, I like to try to deduce what the original floor plan was like. I usually look at door trim and baseboards. If something doesn’t match, odds are that indicates a change.

Knowing a house from the 1920’s would have had a dining room, one bathroom and probably a small kitchen, I deduced that the room that was NOW the kitchen was the original 3rd bedroom. The space that was the sink room/toilet and tub room/pantry was probably the original kitchen. It was off the dining room and had one tall window in the pantry which made me think it was tall because there was originally a kitchen counter under it.

So, I go home and look up the previous listing from the last time it sold. Sure enough, it was a one bathroom house and I can see the window in tub/toilet room and the tall window with the counter top under it. I LOVE it when I am right 😉

The seller really ruined this house in my opinion. They probably did it because they heard it is easier to sell a 2 bathroom house than a 1 bathroom house. True in general, but…..If this house was a newer house, it would be harder to sell. If this house was a larger house, it would have been harder to sell. If this house was not in a cool older area with an awesome location, it would have been harder to sell. But it was none of those. It was a modest sized, older house in an area where a lot of houses still have one bathroom. You’ve really got to know your market when making these decisions. So, they would have been better to have kept it as a 3 bedroom/1 bathroom house than screw up a perfectly good floor plan by adding a 2nd bathroom. They probably would have sold their house yesterday if they had left it alone.

That is just my 2 cents, but if you want 2 more, here you go: After looking at the floor plan, I think I personally would have kept the kitchen where it is. The wall between it and the dining room could have been removed allowing a more open feel as well as a place for bar stools. It would have been cheaper too since all the plumbing was already there. I would have left the 3rd bedroom (where the new kitchen is now) alone. If you absolutely needed a 2nd bathroom, it would have made more sense to have converted one of the bedrooms into a private master bath and walk-in closet. You would have had a private master bathroom that way rather than having the new bathroom on the other side of the house between the kitchen and dining room.

MINI Coopers/Real Estate….Same Thing

by John Rice

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I sold my parent’s MINI Cooper to the first person that looked it, and in about 18 hours after posting. You might think this doesn’t have anything to do with real estate. It doesn’t. It has to do with human nature, which is really what sales is all about.

I didn’t do anything pushy. I didn’t use Jedi mind control nor magic. I just made it easy for somebody to say YES to the car.

Here is what I did. It is the same thing I do for selling my listings:

1. First you’ve got to determine what it is worth. You look at recent sales and your active competition. You want whatever it is you are selling to be one of the top choices for a buyer. If it is not, you end up waiting for all the better choices to sell first.

2. You make it look it’s best. For the car, I detailed it. For a house, this might mean painting, moving some furniture, etc.

3. You’ve got to make it standout among the competition. Pictures and marketing remarks is how you do this. For the car, I figured the fact that it was a well maintained one owner car with a giant sunroof and seat heaters were the most attractive features. Rather than just say it had a sunroof and seat heaters, I showed it in the pictures.

4. You’ve got to present it well. For a house that means have the yard mowed, the mulch fresh and all the lights on for when the people walk inside. For the car, I washed it right before the buyer showed up and parked it at the end of my driveway so he could see it as he pulled up.

Whatever it is you are selling, the goal is to remove obstacles that make the buyer hesitant to pull the trigger. If there was anything major that this car needed, the buyer would have been thinking about the work he had to do to it, rather than fantasizing about driving it with that giant sunroof open. If the carpet is worn in your house, it is harder for a buyer to immediately say yes to it.

And keep this in mind too……ANY buyer that comes to see your house (or car) more than likely wants it or they would not be there. You already have half the battle won if you have accurately presented it. The guy buying my parent’s car asked if they had the title with them before he drove 70+ miles to see it. See, he had already decided that IF the car lived up to how it was presented, he was going to buy it. And he did. For the full asking price.

No magic, no persuasive words, no sales pitch. It was all about making it easy for this guy to do what he already wanted to do, which was buy a well maintained MINI Cooper with a giant sunroof.

I can tell you from experience that ALL buyers walking into your house are hoping it will be the one for them. Make it easy for them to say YES to buying it from you!

Tom Petty School of Negotiating

by John Rice

Well I won’t back down, no I won’t back down
You could stand me up at the gates of hell
But I won’t back down

I’ve been wanting to use that Tom Petty line in my blog for a long time. Feels great.

That is kind of how I feel when I am negotiating repair lists or contracts for my people. See, I’ve got two things I do that always seem to work for me…..well, for my cleints.

ONE: I don’t give up a lot of information about my people or their situation. If negotiating was a game of poker, talking to the other agent about your client is like showing your hand. About the only time I say anything personal about my clients is when there are multiple offers and I want the seller to view my client as more than just the 5 page offer sitting in front of them. Even then, I don’t say anything about their motivation, just what they liked about the house and some other flattering stuff to make the seller want them to get their house.

I recently had a deal where the listing agent was trying to get my client up in price. He asked if we could remove the seller paid closing costs? Like I am going to say yes??? I simply told him that yes, she needed them to make the deal work. Truth be told, we would have come up a couple thousand bucks if needed, but my very conclusive statement with no further discussion make it seem like we had given our best offer. I also didn’t tell the listing agent that it was the ONLY property my client liked. You would be surprised how many buyer’s agents will say something like that, or tell you their client has to find a house this week, or the buyer’s lease is up. Always amazing.

TWO: I don’t budge when I write a repair list. The better agents in town know that the best way to move somebody where they want them is to do it in little steps. I know because that is what I do with them! I recently submitted a repair list for a buyer of mine. The listing agent called and wanted to know if we could knock a couple of things off the list that the seller didn’t want to do. Frankly, I don’t care what the seller feels like doing. I am only out for my client. My buyer can buy any house on the market, the seller only has one to sell, and it has a hole in the roof. So, I told her that there was no need to even discuss the items the seller didn’t feel like doing until we addressed the rest of the list, because there might not even be a deal left to talk about. If I had given her any room, she would have kept coming back again and again. A good firm NO usually ends this, but it is hard for a lot of people to say no. (I’ve worked with this agent a lot and I cannot say anything bad about her. She is just doing her job. She is good enough that she keeps The LEXpert on his toes…..and I enjoy the challenge!)

I totally enjoy trying to get the most for my people. I don’t do it by being mean or pushy. It is a game of chess to me and I want to win for my clients.

The house nobody wanted gets multiple offers OVER the asking price

by John Rice

805 days. That is how long this house was on the market prior to selling early in 2013. I showed it to several buyers during that time. Nobody wanted it.

The house came on the market a couple of weeks ago. There were no cosmetic changes made to the house in the 23 months since it sold last. The asking price was in line with what it was before. This time, the house had multiple offers…..more than two offers. More than three offers. And last I heard, the bidding war was waaaaaaaay OVER the asking price.

What gives?

While this post could be about the difference between having furniture in the house and it being vacant, it is not. I don’t think that is what made this house such a hot listing. I think it is the market.

When there are a ton of choices and fewer buyers, the worst houses stay on the market forever. When there are few choices and lots of buyers, even a lousy house can sell fast.

Here is the thing to think about: If this house took 805 days to sell when buyers had more choices, what do you think will happen if there are either fewer buyers out there shopping, more listings on the market, or both? Yeah, another 805 days of being everybody’s last choice.

Until there is an app for experience and caring, I’ll be here to help you make the wisest choice possible.