retire in lexington

Selling? What you like doesn’t matter

by John Rice

A long time ago, my wife decided she wanted a Subaru Outback. We looked at a few on used car lots. I did a lot of research to find out what trim level we had to get for her to have the sunroof and heated leather seats that she wanted. There really weren’t a lot of used Outbacks in or around Lexington at that time. This was so long ago that I found a classified ad in a newspaper that said “2008 Subaru Outback, SI Drive” with the price and the seller’s phone number. That was it. Not a lot of info to work with. Definitely nothing to make the guy’s phone start ringing. But to me, this car having SI Drive told me a whole lot more about it. Having done the research, I knew that was only offered on the top trim level. It had the giant sunroof, heated leather seats, and the bigger engine. When we went to see the car, the seller kept talking about the SI Drive. I could tell it was very important to him.

A lot of home sellers are like that too. They want to focus on what is important to them when selling their house, rather than focusing on things that are important to the buyer. I see it a lot in the marketing material of For Sale by Owner listings. I once read a flyer where the seller spent a lot of space talking about how level the sidewalks are.

About this same time, I sold a house to a family that I have since become friends with. They found the house by driving around the neighborhood. They would have never come to see it if they had only seen it online. Why? Because of the marketing remarks. Instead of mentioning the hardwood floors, instead of mentioning that one of the upstairs bedrooms was huge, or that there were bedrooms on both levels of the house, or that the backyard was an awesome park-like oasis, the realtor used that space to tell you that the exterior was maintenance free, that the curtains stayed with the house, and that there was an allowance for water-proofing the basement as well as mitigating radon. The marketing remarks could only have been better if they said  “Must see! You get to keep the seller’s curtains AND fix some major problems with this house, but at least you’ll never have to paint the outside!! NOT a drive by!”

The hardest thing about real estate is getting sellers to think like a buyer and a buyer to think like a seller. I think if that ever were to happen, I’d probably be out of a job! Being a realtor these days is as much about mediation, negotiation and understanding differing perspectives as it is about houses.

BTW, “SI Drive” is a feature that has 3 settings for throttle response and transmission shift points.

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.”

Is a view worth less if it is not as good?

by John Rice

I was driving through the new Peninsula neighborhood the other day. It is over off Richmond Road and backs to the reservoir. I could see the back of the houses on Dew Court, Rain Court and Coolwater Court. For decades the owners of those house have had a rare and fantastic view of the water and the woods where there are now these new houses.

But that has changed. The water is still there of course. The woods are gone.

Question is this: Are those older houses worth less since the view is not as good?

To those owners who have enjoyed the “Old” view, I am sure it is not as good now. They probably think these new houses have impacted the value of their homes. I totally get that vibe. I dealt with something similar. I used to have a peek-a-boo view of the Greenbrier Golf Course from my last home. Across the fairway was a beautiful hillside full of trees. About 6 months after I moved in, I heard bulldozers clearing the hillside. Now there is a neighborhood there. While I did not like the new view as much as the old one, it was still a view. It just didn’t extend past the golf course now.

And that is exactly what the 1980s houses have. They still have a fabulous water view. I mean, the new houses are going to be extremely desirable being on the water and they have the houses from the 80s on the other side of the water in their view. There is no reason to think that somehow the market is going to like the 1980s houses less because they now have a view of the new houses across the water, right?

Something else to consider. Whenever the 1980s houses come up for sale in the furture, no buyer is going to know that the view was better before the new neighborhood was built. All they will know is what is currently there, which is a very rare water view.

Two or more negatives are hard to overlook

by John Rice

Sometimes a bunch of negatives are overwhelming when you have to see them all together. This is something I learned when I bought a fixer upper house that was worn out, out-dated, and in disrepair. I was broke back then so I had to live with it for a couple of years. Man, that was rough. I remember thinking that the carpet wouldn’t look so bad if the walls weren’t so bad, and how together they really make the light fixture unbearable. I guess that is when it first hit me how 2 or more negatives seem to compound their effects when viewed in the same room.

I’ve got a listing in my pipeline that I have been working on for a little bit. In general, it just feels like a rental grade property. It has a nice floor plan and all, but just doesn’t feel like something a buyer will fall in love with. Like I have always said, a seller has more power in the deal if the house comes across as something special. The market is getting a glut of “Average” houses. Now is the time to make your house stand out.

This house already has some pluses that could easily be over looked. Things that I bet most buyers wouldn’t even remember after leaving the house if we didn’t do anything to it. So, what is the plan? We just had it painted. That will unify the space to a buyer. You have to remember that buyers are going from room to room in a 20 minute window. They like it all to be consistent. The next step is going to be replacing the vinyl flooring in the baths and kitchen. Then we’ll clean the existing carpet and stage it.

Now, when a buyer comes in this place, they will see fresh paint, clean floors, and new vinyl in the kitchen and baths. They will also probably now notice the few updated items. See, the goal is to make it the best house any buyer can get in the price range. We do not have to make it perfect, just a little better than the second best house currently for sale. After all, as long as there is one buyer out there, you know they’ll pick the best one.

The repair list shouldn’t be like playing Marco Polo

by John Rice

Most people think all a realtor does is open doors, fill in the blanks on the paperwork and cash checks. Sad thing is that there are a lot of realtors who think this too.

Not me.

The ultimate goal is the get the best terms for my clients and make the process as smooth and drama-free as possible.

I recently had a situation where my drama radar was going off so I made some moves to prevent it.

I got a repair list on one of my listings. The issue was the wording on the repair request for an air conditioner. The other realtor stated what the inspector found and pretty much just said fix it. The inspector stated that the air conditioner was only producing a temperature difference of 9 degrees. Now, I knew what the intent of the buyer’s request was. They wanted a normal working air conditioner. But at what point would they find a repair acceptable? If my buyer fixed it and it was only 10 degrees, would that be okay? Who knows? I never liked playing Marco Polo when I was a kid. I don’t like finding Waldo. I also don’t like the “I see something you don’t see and the color of it is” game. I am definitely not going to play those games with a repair list.

My Dad is retired now from being an attorney, but he is still a brilliant man. Back in 2005 when I was writing my first ever repair list, I consulted him on the wording. I think I did what most realtors do, which is to state the problem and just say fix it. He told me two things which I have never forgotten and try to share as often as I can with other realtors so our industry improves:

  1. Write a repair to be done to achieve a goal rather than for a task to be performed. Why? You can sometimes do a task which doesn’t achieve the goal. When that happens, you have no recourse because you asked for a task to be performed and it was done as you requested.
  2. Write EVERYTHING so clearly that a third party could read the contract, addenda or repair list and know exactly who was to do what and what the agreed upon outcome should be. That third party could be a judge or mediator.

So, when I read this one repair item, I knew there was no specific outcome requested. There was no verbiage saying that “If the seller does this with the air conditioner, the buyer will accept it.” The effort to get this right at this point may have saved some last minute drama right before the closing. When my seller has packed up and moved out, and the buyer has packed up and made moving plans is NOT the time to discover that we had a difference of opinion on what was expected.

Ultimately we agreed upon wording that said the air conditioner had to cool within industry standards, which is a minimum temperature difference of 15 degrees.