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Home Staging Multiple Choice

Which of the following conclusions are highly likely based on the actual MLS photo (above) from this Richfield ”For Sale” home:

A. Per the purple sheet over the bed, there are no window treatments anywhere in the home (if they’re missing in the bedrooms, they’re likely missing everywhere);
B. The home is a rental;
C.  The rooms that haven’t been photographed are messier;
D. The Buyer’s inspection won’t be pretty.

Correct answer:  all of the above.

In fact, the MLS Remarks confirm that the home is a rental, and requires 24 hours notice to show.

On the other hand, for $95k, Buyers may not care . . .

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sand

From 16,000 Houses Down to . . . a Dozen or So

“Before you’re addicted to heroin, you have lots of worries; after you’re addicted . . . you just have one.”

–George Carlin on the “virtue” of being a heroin addict.

“I’m not in favor of abolishing the government. I just want to shrink it down to the size where we can drown it in the bathtub.”

–Republican activist Grover Norquist.

How do prospective Twin Cities home Buyers and Sellers possibly track some 16,000-odd Active listings in the twelve county metro area?

Short answer:  they don’t.

Fortunately, as I tell my clients, they don’t have to.

Starting Point:  Three Good Comp’s

For home Sellers, the market shrinks to at most a dozen homes:  the 3-4 best Comp’s (“Comparable Sold Properties”); the 3-4 closest sand2competitors currently for sale (“Active” listings on MLS); any nearby “Pending”* homes (under contract but not closed) that are similar; and perhaps another 2-3 homes that failed to sell (“Expired’s” or “Cancelled’s”).

For Buyers, meanwhile, the market similarly contracts — or at least their agents hope! — to a handful of similarly priced homes, with similar attributes, in at most 2-3 neighborhoods.

For both Buyers and Sellers, though, the approach is similar.

Or as I tell selling clients when I discuss my CMA (“Comparative Market Analysis”) with them at their Kitchen (or Dining Room) table, the same process the listing agent goes through with Sellers is repeated twice more:  the first time by the Buyer’s agent coaching their client prior to making an offer; and again, weeks (months?) later, by the appraiser sent out by the Buyer’ lender, whose job is to support the negotiated sales price.

In each case, the task is to compare-and-contrast the most similar homes with what Realtors call “the subject home,” isolating the key differences (“adjustments”) and assigning dollar amounts to them.

“9/10 of a Bird in the Hand”

“Yeah, Yeah,” I can hear (some) readers complain . . . “but what’s the bottom line??”

sand3To sell, homeowners need to stand out relative to their peer group.

To entice an owner to sell, Buyers need to offer enough that it’s not worth the owner’s risk of waiting longer for a better deal.

Or as I coach my Buyer clients, “.90 birds in the hand (usually) beats 2 in the bush” (in fact, the average sales prices as percentage of list in the Twin Cities is in the low 90′s% now).

*”Pending” homes are most useful for pricing purposes when they sell quickly — presumably for little or no discount.

See also, “Why the Neighbor’s House Usually Isn’t a Comp”; “Comp’s For Advanced Beginners”; “More Than This, Less Than That”; and “True or False:  Expired Listings Aren’t Useful in Establishing Fair Market Value.”

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The Case for Listing at $300,000 instead of $299,900

by Ross Kaplan on October 22, 2014

How to Show Up in Twice as Many Home Buyer Searches

Psychologically, $299,900 somehow just seems cheaper to Buyers than $300,000 (just like $2.99 a gallon appears to be less than $3).

gasBut, it’s a mistake to price residential real estate that way — at least around century and half-century marks ($100k and $50k).

That’s because home Buyers typically search in ranges of $50k or $100k.

So, that $300k listing will get picked up by Buyers searching between $250k – $300k, as well as $300k – $350k.

However, a home listed at $299,900 will only appear in the first search.

P.S.:  The above tidbit is courtesy of Edina Realty’s Jim Young.

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Fresh-Baked Cookies . . . at Closing?!?

by Ross Kaplan on October 21, 2014

Realtor — and Title Company — Trade Secrets;
or, “What’s That Toaster Oven Doing Next to the Copy Machine??”

Home Buyers associate fresh-baked cookies with open houses.

cookiesThe smell creates a nice “homey” vibe, and puts prospective Buyers in the emotional mood  . . . to buy.

But, I’d never encountered fresh-baked cookies at closing before.

At least not until last week.

The cookies were courtesy of Liberty Title (I noted a toaster-oven in the corner of the office, discretely located next to the copier).

P.S.:  Want a Realtor trade secret?

Store-bought cookies warmed up in the oven at 300 degrees for 10 minutes accomplishes the same effect.  My personal favorite:  Keebler chocolate chip.

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Less Distress

October 21, 2014

Twin Cities Short Sales, Foreclosures Fall to 7% The general public may not be aware, but local Realtors certainly are:  the percentage of distressed sales in the Twin Cities is now about 7%. That’s a far cry from the +50% level breached just four years ago. Amongst other benign effects on the local housing market: […]

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Homes With No Basement: How Big a Discount?

October 20, 2014

When Bigger Isn’t Better Just like the discount for a one-car garage varies, so, too, does the discount for a home with no basement (at least in the Twin Cities housing market, where single family homes routinely come with — and Buyers expect — finished basements). The biggest variable driving the discount for no basement? […]

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The Jack O’Lantern House

October 19, 2014

Is it Halloween Yet? [Editor's Note:  With Halloween approaching, I thought it was timely to re-post a favorite from previous Falls.] I’m a big fan of dramatically lit homes. And with the seasonal change, we’re heading into ever-shorter Fall days. And yet, the technique doesn’t work all the time — and can even backfire: especially […]

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Open House Today (10/19) From 1 – 3 p.m.

October 19, 2014

Prime Lake Forest Location Where:  2315 Parklands Road in St. Louis Park’s Lake Forest neighborhood. What:  Cape Cod-style home with great bones and nice finishes. When:  1 p.m. to 3 p.m. today.  Days on market: six (listed 10/13). How much:   $529,000. Who:  listed by Ross Kaplan, Edina Realty – City Lakes. If you’re looking for […]

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