old houses

Does spending more get you more?

by John Rice

I’ve always been into two things: Houses and cars.

There are a lot of luxury cars out there that are really just blinged out versions of cheaper cars. Cadillac Escalade? At its core, it is a Chevy Pickup truck…….sorry if you have one and I have insulted you. Lexus TX? It is a better looking Toyota Highlander. Nothing wrong with these companies doing this. It is an economy of scale to be able to sell essentially the same thing to buyers in different socioeconomic classes. They add a few features and make it look better for a lot more money, but all the important stuff is shared with their cheaper platform mates.

Now that you’ve got the concept of today’s blog post, let’s see how it relates to houses.

I showed a house to a client today. It was in a very Toyota Highlander neighborhood. It was close to 3500 square feet with a basement. Great location. Great school district.

I told my client I thought this $484k house was a great value. Why? Because if you spend $100k more, you wouldn’t really get a bigger or better house, you might just get brick on all four sides and be in a more Lexus TX neighborhood.

Sometimes spending more doesn’t really get you much more.

“How long will it take to sell my House?”

by John Rice

I get asked this on every listing appointment. It is hard to believe that a couple of years ago, it was rare for any house in any condition to make it past the first day on the market. I usually don’t reply with an amount of time, but with a sequence of events that need to happen to attract a buyer. The honest to goodness truth is that any house should sell pretty quickly if the seller will do some prep work. Granted, there are exceptions…..Two million dollar house? Will take time since there aren’t many buyers in that price range. A unique house? May need a unique buyer. An overpriced house? Will usually only sell to an idiot with a realtor who thinks we are still in the 2022 market.

I’ve been doing this a long time. This is how it usually goes in this changing market. I see the house. I ask the sellers if they are able to do any work that needs done to attract buyers. Buyers want as move in ready as possible and for the best price right now…..well, I guess they always have but now they have more listings to chose from and sellers can no longer just put their house on the market without a little prep work. Sometimes the seller can’t/won’t do anything. If they can’t/won’t, I tell them the price I think their house will sell for just like it is. Usually though, the seller picks a few items from the list. We put it on the market. They get positive feedback for the things they have done. They get negative feedback for the remaining items on the list.  After awhile, the seller starts to realize that they are going to have to do more items on that list or reduce the price. Often, buyers subtract about 5 times the cost for the remaining items on the list. I’ve been on the buyer side of this. They almost always say something like “If I have to paint this whole house I’m not paying a penny more than $XXX,XXX!!”  or “I would need to replace all the carpet and I like hardwood, so let’s just subtract the cost of hardwood from the asking price and go from there.” Can’t blame them. After all, it is turning into their market these days.

Eventually, the seller plugs away at the list until it sells. See, there is the sequence of events I mentioned at the beginning of this post. Now that the house is ready, it is going to sell because it is competitive and will almost always fall on the short list of a buyer.

But what happens to the people who do everything on the list from the beginning and price it correctly? Their house usually sells very quickly. Why? Because buyers want the best house for their money. Make your house THAT house, and start packing.

Negotiating is a lot like playing poker

by John Rice

When I was a little kid, my dad had this old set of poker chips. There were red, white and blue ones built into a little round thing with a handle on top. I remember playing poker as a pre-teen with my friends. I also remember winning a lot. I didn’t do it by bluffing or anything that actually had anything to do with the game itself. What I got good at was studying my friends. It’s pretty darn easy to win when you can tell if your pals have a good hand or not. My dad always told me I was pretty good at reading people and seeing their motives. That has been a useful skill in my career as a realtor. 

I remember a sale many years ago with a great realtor. He did everything he should have done. My clue about the buyer’s motivation was the closing date.  It was the Friday before school started back after Christmas break. Sure, most real estate deals close on a Friday. What made this one stand out to me was how soon it was. Not the usual 30-45 days out. This one was just about 2.5 weeks out. So, I hit Facebook, and sure enough there was a person with the same name with school aged kids who lived in the same surrounding town that was on the check for the earnest money. I also knew that most seller’s wouldn’t want to be moving out of their home the week between Christmas and New Year’s Day. We stood firm and got our price.

I had another deal like that. My listing was in the only neighborhood in its price range to have the very desirable school district that it did. We got an offer so low that we didn’t even counter. The buyer’s realtor told us the reason for the low offer was due to the perceived poor condition of the house. I figured they must really want to be in this school district. I mean, there were tons of new/newer houses within walking distance of this one, but they were in a different school district. I don’t know why somebody would pick a house they didn’t like that much when they can get a better house for the same money. It had to be school district. I went online to see what all choices this buyer had in that school district. The only other house was one with a crazy steep driveway…….so I knew we could hold firm to our price. We did and we got it, despite the other realtor’s great effort to get it for less.

From the lines of that old Kenny Rogers song, “You gotta know when to hold ’em.  Know when to fold ’em.  Know when to walk away.  Know when to run.”

Which is better? Older or newer homes?

by John Rice

I often get asked by buyers if they should buy an older house or a newer house. My usual response is to say that it depends on what kind of problems they want to have. I get crazy looks when I say that, but it is just my way of telling them that all houses will have problems. If you don’t have one now, just wait because your newer house will become an older house quicker than you think. Basically, it is your house verses Mother Nature and Father Time……and those parents usually win.

I have lived in both older and newer houses all my life. When I was a kid, I went from a 1910ish four square to a 3-year-old ranch. Next, my parents bought a house in Kenwick  from the 1930s. My first house was built around 1915. My second was 1973. Then from 1997 and 1986, plus a collection of rentals built from the 1940s through 2006. All of them had things to deal with. 

There seems to be this misconception that old houses were built better. True, MOST were built with more care than today’s homes are. I say most because my first house, the one built around 1915, was nowhere near as well-built as my parent’s Kenwick house from the 1930s. I thought it would be, but once I moved in, I started to realize it wasn’t.

Old House misconception #2 has to do with today. Many people think that any older house is better than any newer house is today. After living in a lot of older houses and showing a bunch to my clients, I can tell you that what it comes down to is maintenance. Even the best built house from yesterday will be nothing but trouble today if somebody didn’t keep it up. Remember, an older house has been in the ring with Father Time for more rounds than a newer house will have.

Here are some of the common old house issues: Inadequate electrical, plumbing, insulation, lack of maintenance, and poorly done improvements to any of those prior items.

Newer house issues: Rushed construction by unskilled/uncaring workers sums it all up the best. I have a friend whose house was practically rebuilt after a fire. It had no insulation on one side of the house because the drywall contractors showed up before the insulation contractors were done. On my house from 1997, poor mortar joints on a brick window sill allowed water to run down the inside of the brick veneer and rot some of the sill plate. I only found it out when I did the demo for a new floor in 2010 when it was only a 13 year old house. If today’s workers would apply to their trade the same care they use to draw naked women in their potapotties, we would have the best built houses of all time!

Occasionally I do see both a really well-built newer home and a fantastic older home. I represented a builder who did a great job of making decisions that the buyer wouldn’t even begin to appreciate for years to come. He did a lot of little things way above minimum code. I also just sold an older house that had been well maintained and had recently been overhauled by a good contractor. That combination made it a pretty unique older home and a good pick…..I guess that buyer got the best of both worlds and none of the negatives!

Old house/New house & my latest car

by John Rice

M3 S2

Cars and houses.

Those are my two things.  I can’t talk about too much else.  I don’t keep up with politics, pop culture or sports.  Get me on either of these two items though, and I am hard to shut up.

I recently added another car to my collection…..if you want to call a bunch of cars that aren’t old enough to be classics a collection.  Junk yard or used car lot is probably a more accurate term.

Sure, I’ve got a new car I use for work.  It looks good.  Is fast.  Gets lots of compliments.  But to me, it is sterile and generic.  It isn’t anything special because you can go to the dealership and buy one just like it.  I don’t feel anything but comfortable when driving it.

What gets my blood circulating is older BMWs.  I love the way they handle.  I love the way they look.  To me, the 90s-early 2000 BMWs were the high point for the brand.  An era I want to celebrate.

They don’t build them like they use to.

That is a phrase you often hear about older houses too.  Just like some people are into older cars verses new ones, some people also prefer an older house to a new one.  Old house people think all new houses are build poorly and lack any character.  The people who like new houses don’t want old house problems or floor plans that don’t work as well for today’s lifestyle.

Whether it is cars or houses, it is cool to like whatever you want.

As a realtor, the task at hand is getting in the mindset of your client and figuring out which they want.  When I buy a car, it is about what I want.  When I am trying to make a real estate love connection for a client, it is all about what they want.  Sometimes they don’t know yet and you need to help them figure it out.

After 12 years of doing this, I can pretty much tell if a client is really wanting to build a brand new house.  If you show them perfectly good move in ready houses and they don’t like any of them, they probably want to build even if they don’t realize it yet.   Another obvious sign is if their previous houses were brand new.  You would be amazed at how many people build a brand new house with each move.

The old house people will sometimes look at new houses, but they don’t like that the trees are small, or comment about the lack of character or perceived quality.  They walk in a perfectly good new house and don’t have any reaction at all.  It is just a structure with 4 walls to them.  Take them in an older house and they light up.

What do I like?  Both really.  In my dream world, I have an old house in a cool part of Lexington.  In that same dream world I have a super modern beach house.  The kind that is mostly glass.  In the garages of each place, I have a couple of older BMWs and also a new car because sometimes it is really nice to hop in a new car with really good air conditioning, comfortable seats and an awesome stereo with bluetooth.