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Older house verses newer house, which is better?

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 people that all houses will have problems. Basically, it is your house verses Mother Nature and Father Time.

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 1930’s. My first house was built around 1915. My second was 1973.  Then a 10 year old home. Then 26 year old home. All of them had their own set of issues.

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 1930’s.

Another misconception is that people think any old house is better than any new/newer house is today. After living in a lot of old 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. An older house has been in the ring with both Mother Nature and Father Time for more rounds than a newer house.

The new house misconception is that they won’t last as long as an old house. I use to think that until my parents bought a 150+ year old farm-house. Their house started out as a 2 room timber structure.  Then a porch was added on the back which was later converted to be a kitchen. Then a new porch was added to the side of the kitchen which later became the new kitchen and the old kitchen became a dining room. Then somebody added a second story over the original structure. Then came a second story over the original porch/current dining room. My attitude now is that if my parents house can defy all building codes and even gravity a little, any new house should last just as long. 

Here are some of the common older house issues: Inadequate electrical, plumbing, insulation, lack of maintenance, and poorly done improvements at the fault of previous owners.

New/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. On a previous 10 year old house I owned, 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 the new tile floor. If today’s workers would apply to their trade the same care they use to draw naked women in the 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 used to represent 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 that exceeded minimum code. I remember selling 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.

A bridge not to burn

by John Rice

We are back in a market where buyers want to test sellers and see how far they will bend.

Used to be that the average List-to-Sale percentage was about 97%. That means that the house sold for 97% of the list price. As the market got hot right before COVID, it inched up. During and immediately after COVID, houses were selling for no less than full price, many going for 10% or more over the list price.

Those days are gone. I occasionally see a house that will go for slightly over the list price. That is only for super amazing houses that got multiple offers immediately. Short of that happening, full price is about the best a seller can expect and not a whole lot sell for that.

I have had many sellers this year get super discouraged when we finally got an offer. Most will tell me they don’t even want to reply to it. I tell them that it doesn’t matter what the initial offer is. What matters is how high the buyer will go. Most of the time the buyer will end up paying an amount that the seller is satisfied with.

If a buyer offers 92% of the list price, odds are they will go to 96%.

If a buyer asks for $5k in repairs after a home inspection, odds are they will settle for $2500.

It is crazy how predictable this is. So much so that when I get an offer or a repair list, I am usually correct on where it will end.

So, if you are a seller, be prepared for this. Don’t be offended. Don’t reject the offer or burn the bridge. Keep playing the game until it is over. Odds are you will be glad you did.

Selling a house is like middle school gym class

by John Rice

I was that kid in middle school that was always picked last in gym class. You know the drill. Two team Captains (Buyers) pick their team (Houses) until there is only one left and that person gets picked by default. Don’t feel bad for me though…….I’m sure the past 40 years has been better for me than for most of those picked before me.

The real estate market is very similar to what we’ve all experienced in gym class. Buyers organize the houses in order of preference. Naturally, they are most interested in move-in ready houses that are priced right. Then they move down the list to those that are less desirable.  Sellers want to be picked sooner rather than later. Think “Days on Market.”

Once the Captains are chosen, that is like the beginning of the house hunting season. The Captains pick those they think will be the best. Once those kids are on a team, they are “Sold” and not available anymore. All a Captain can do is pick the most desirable kid from what is left. Once the best one has been picked, the second best one becomes the new best choice. That is until it was just me standing there and the Captain says my name with the enthusiasm as if he had just heard the cafeteria was serving goulash for lunch.

Right now, we are in the time of year where not many new listings are hitting the market. It’s kind of like when there are only about 6 kids left from the whole class. These are the ones that maybe nobody really wants, but the next kid that gets picked is going to be the best of those that are left. There are many sellers right now with average to below average houses that will get contracts simply because there are no better choices for a buyer right now. I always say that fall is the best time to get rid of  house that nobody has wanted all spring and summer, which I guess is my whole point.

 On a side note, the only time I ever got picked any higher than dead last was when it was for volleyball. See, I am left-handed. When I serve, the ball always goes on the opposite side of the court from where it lands when most people serve. Everybody on the other team was always caught off guard. Nobody ever noticed the pattern of where the ball would go when I served. Come to think of it, that is one of the first times I ever realized the benefit of zigging when most people zag and zagging when most people zig.

#1 biggest mistake a seller can make

by John Rice

Often, when talking about pricing a house with a seller, they say something like “Couldn’t we price it at this number and won’t people just make an offer if they like the house?” Makes a lot of sense to the seller, but doesn’t when you look at it through the buyer’s eyes.

Why? Let’s say a buyer is shopping for a $400k house. You have a house that is worth $350k, but are asking $400k because somebody will make an offer if they like it, right? The buyers are viewing every house that is priced at $400k, most of which are really worth about $400k. To buyers your house will seem like the worst house they have seen with a $400k list price. Why? They are comparing it in THEIR mind to the better houses they viewed that are worth $400k. The buyer is either going to get a better location, a bigger house, or one in better condition……They are never going to like your house enough to make an offer. On the flip side, the person who is going to spend $350k is never going to see your house because they aren’t looking out of their price range. So, you have a situation where the people looking at your house aren’t going to buy it and the person who would buy it isn’t going to see it!

Here are some tips to keep this from happening:

1) If you must price on the high side, never go more than about 5% over the recent sales of similar homes in your area. Sometimes an over-priced house will get a lot of showing, which makes the seller think they are priced right. You can still get a lot of showing on a slightly over-priced house, but no offers. When you get showings and no negative feedback, it means you have a price issue. I say if you have a $350k house, it needs to priced around that number.

2)  Avoid the temptation to have a high price and have your agent tell people you are motivated. When I see a steep asking price and the agent says the seller is motivated, what comes to my mind is that they are motivated to get their price. A truly motivated seller will price their house at or less than what it is worth. In 2025, the days of testing the market are a thing for history books.

3)  Realize how the market works. You have so many buyers and so many houses. The buyer gets to pick whichever house they want and they always pick the best one. Even in a sloooooow market, I have been in multiple offers. It is human nature to want the best. The buyer is comparing all the houses available. Make your house the best one by pricing it right.

Trust me on this…There is no magic in real estate.

How much value do improvements add? Depends on the rest of the house

by John Rice

I often get asked what improvements can be made that give the biggest return. I think a lot of folks are hoping I will say new flooring, new counter tops, stuff like that. I say do those if they are common for your neighborhood and/or price range, and only if your house does not have big negatives that future buyers will have a hard time overlooking. Not all improvements add more value than they cost. Keep in mind that you are focusing on that one new improvement. Sure, it is exciting. You are removing one negative from your house. When you go to sell, the buyers are looking at your whole house. They are weighing the positives against the negatives.

Many years ago, I had two older home listings that both had fabulous features. One of them had a reaaaaally narrow staircase to what had been the attic. It had a new kitchen, great deck, and 2 fantastic bathrooms. Another listing had the smallest living room I have ever seen, but the whole upstairs was brand new. I mean the seller took the roof off and had it rebuilt all new by a very reputable remodeler. It had a walk-in closet and master bath like a new high end house. It was totally superior to any other house in the neighborhood and its price range. Both of them took a while to sell. I would call the agents that showed them for feedback and they would go on and on about how much the buyer loved certain features and what a nice job the sellers had done with their improvements. I was always tempted to interrupt them and remind them that the house was for sale. I let them finish and they always started their last sentence with the word “But”. It was like this: “Buuuuuuuut that living room was too small.” Or “Buuuuuuut they just couldn’t handle those stairs.”

(Since I brought up the whole adding value verses cost of the improvement thing, would you like to know what is the highest return when getting your house ready to sell? Paint. Nobody ever gets excited when I tell them this, but it is true. Fresh paint always make any house feel better.)