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Help A Buyer Out: 5 Tips Sellers Would give Buyers if they Could
The
conventional wisdom is that buyers and sellers go together like oil and water.
That is to say, they don’t go together at all. Some say they are at odds simply
by virtue of sitting across the bargaining table from one another, which - along
with negotiation and legal issues that are par for the home buying course -
create the presumption that they want totally different things.
The prime example of competing buyer and seller interests is this: the buyer wants to pay as little as possible, while the seller wants to get top dollar for the place. But there is another way to look at this entirely. In fact, there’s a point of view from which the buyer and the seller want exactly the same thing: the buyer wants to buy the place, and the seller wants to sell it to them! And I’ve seen many buyers and sellers act cooperatively to achieve just that result.
Nevertheless, there are things that sellers can see from their side of the table that you cannot. Sellers have insights into their own mindsets that, if revealed, can be very powerful tools in helping buyers optimize their approach, offer and interactions with the seller to both buyer’s and seller’s benefit. So, in the interest of helping both buyers and sellers move closer to an outcome that helps them both achieve their mutual goal, here are a few of the insider secrets from the seller’s side of the bargaining table that they would tell buyers, if they could.
1. Trashing my house doesn’t make me want to sell it to you at a discount. To a seller, their home is their castle. It’s the place where they’ve raised their children, and has been the backdrop for many of their memories. It’s the asset into which they’ve invested the lion’s share of their time and money, sometimes for years. It’s an intensive expression of their personal tastes. And it’s also the asset they must convert into as much money as possible to move forward with the next phase of their lives.
All that said, the average seller knows most things about their home that you can see with the naked eye. So if you, as a buyer, think trash talking a home, pointing out obvious flaws or issues is a good strategy for getting the price down, rest assured that you are not telling the seller anything they didn’t already know when they set the list price. In fact, you might very well be doing your case more harm than good, as this “strategy” is highly likely to alienate and insult the seller whose cooperation you seek.
If you feel strongly that something about a place makes it less valuable than the comparables the seller seems to have based the list price on, work with your agent on how best to communicate your offer price rationale to the listing agent in a way that is diplomatic and fact-based.
2. Knowing that you have cash makes me feel comfortable taking your offer. With distressed properties, over-asking multiple offers, and the generally warm-to-hot seller’s market in many areas, it has become increasingly common for sellers to request proof of a buyer’s “cash to close.” (This usually takes the form of bank or other asset account statements, with the sensitive account number information blacked out for security purposes.)
Some buyers in competitive situations have begun to proactively offer such proof, even when it hasn’t been requested, and even for non-cash offers.
Other buyers, though, take offense. Why shouldn’t the mortgage pre-approval letter be enough? Why should you have to jump through yet one more documentation hoop? Is the seller just plain nosy? Why are they all in your business?
One word: comfort. Over the last few years, the number of home sale transactions that went into - and fell out of - escrow due to last minute loan problems of pre-approved buyers hit a record high. While this is awful for buyers to go through, it’s even more disruptive for sellers, who are relying on the transaction to close in the time frame the buyer provided to move forward with their own lives. It’s also a worst case scenario for a seller who had 5 offers on the table to choose one and then have it fall out of escrow later on.
And sellers’ agents know this - often, the issues which derail a buyer’s loan can be resolved with money, extra cash down, extra cash at closing, extra cash to put in escrow for post-closing repairs required by the lender or the city. So, proving that you have more cash than you appear to need to close the deal doesn’t necessarily set you up for the seller to ask for more cash - but it might help them feel that you’re the buyer most likely to sidestep mortgage obstacles and seal the deal.
3. It’s all about the Benjamins - but close-ability is a close second. Buyers be on notice - all the love letters, cute dog pics and cookies in the world will not make your offer win out over others that are offering significantly higher than yours, financially speaking. Now, please don’t write in telling me about the case of your cousin’s dog groomer’s tarot card reader who got a home for less than 10 other offers because she helped the little old lady seller take her garbage cans to the curb - most little old ladies need cash to get through their later years.
There is always an exception to the rule, and it does sometimes happen that a seller will take a slightly lower offer than the highest for one reason or another. But if you’re trying to create a plan that stacks the decks in your favor in a multiple offer situation, your first priority should be to offer as much as you can, without spending beyond what is affordable for you and beyond the home’s fair market value.
That said, sellers also care - a lot - about how likely the offer they accept is to close escrow. And when multiple offers get so numerous and so frenzied that buyers seem to be throwing money at a home, smart sellers pay attention to the fact that their home might very well not appraise at a crazily high price and focus on offers that seem realistic and close-able, which can mean offers below the highest.
Approval letters, proof of cash to close, the professionalism with which the offer is prepared and presented (see below), and even things like your credit score, your choice of mortgage broker/professional - all these things contribute to or detract from a seller’s estimation of how close-able your offer is. If you’re competing against other offers, you should be maxing out both your price and your offer’s close-ability, as evidenced by these characteristics.
4. Your agent represents you to the world of sellers. Choose wisely. See above. A buyer’s broker or agent has a lot of influence on whether the transaction closes, and how smooth or bumpy the ride is. If your agent’s level of professionalism is lacking, it will show - and listing agents might actually rank your offer below others, in terms of close-ability. If your agent’s level of professionalism is stellar, the opposite can occur.
Before you choose an agent, ask around your circle of friends and do a little online searching or even calls to past clients to see what you can find out about their reputation for professionalism.
5. Ask nicely - the old “flies with honey” adage is true. The conventional narrative about buyers and sellers is that they are adversaries. But I’ve been around this block a few times, and I think the average buyer would be absolutely gobsmacked at the number of times sellers are actually ready, willing and able to agree to their requests throughout a transaction. This is especially the case where:
- the buyers’ requests are reasonable and not nickel-and-dime nitpicks
- the buyers phrase their requests nicely, and
- the buyers have been living up to their end of the bargain throughout the course of the transaction.
Compare this with buyers who try to hold
sellers hostage to their requests with the threat that they’ll kill the deal if
the seller doesn’t do every single penny-ante thing the buyer wants.
I’ve seen sellers agree to leave valuable personal property behind, have repairs made, give thousands of dollars in repair credits or price reductions after a concerning inspection report - despite a hot seller’s market - all because they were good people, could afford to, and the buyer’s approach was more sweet than it was sour.
SELLERS, past and present: It’s your turn - what advice have you always wanted to give home buyers?
ALL: You should follow Tara and Trulia on Facebook.
Help A Seller Out: 5 Tips Buyers Would Give Sellers if they Could
It is a rare occurrence these
days to have a home’s buyer and seller sit down around the kitchen table to make
a deal. In some areas, they do still sit around the attorney’s boardroom table
to close the deal, but by that time, the deal is done and the ship has already
sailed on any avoidable mistakes.So in the vast majority of home sales, buyer and seller never connect in person, never talk, and never exchange insights or information except in the most formal, written formats - despite being effective business colleagues in one of the single most important transactions of their lives. And here’s the rub: buyers sit on a wealth of knowledge that sellers crave to know, most of which could be filed under how to attract buyers and make them want to buy a home (or at least, not turn them off). So, since buyers and sellers can’t get together, allow me to reveal a handful of helpful insider insights that the buyers I’ve worked with and connected with over the years would reveal to sellers, if they could.
1. You should see what your home looks like online. No, really. If you did your due diligence before listing your home for sale, met with agents and reviewed their marketing plan they use for their listings, chances are good that you chose an agent who takes online marketing very seriously and said as much during your listing interview. But somehow, there are still hundreds of listings in every major city that receive a failing grade on their online presence, once the home has actually been listed.
Every day, online listings are activated on Trulia and all across the real estate web with:
- only one or two pictures
- no pictures at all
- multiple photos that represent the home very poorly or show it in its worst light, in terms of the shots selected and included in the listing (e.g., photos focusing on the dumpster in front of the house, or the messy breakfast dishes on the table), or
- listing descriptions that bemuse us buyers, but would befuddle and even anger the homeowner, like the homes whose descriptions start off with the attention grabbing: “This place is a mess!”
2. If your home is seriously overpriced, I’ll wait for the price to come down before I even come see it. You might be thinking the best plan of action is to list your home high, planning on the fact that prospective buyers will want to bargain the price down. And, in fact, this might be true for your area - your agent can brief you on what the standard negotiation practices in your neck of the woods are, and you two can then work together to factor them into your pricing strategy.
That said, even in an area where homes generally go for below-asking, buyers are willing to do some basic negotiation. They are not, generally, interested in correcting a seller’s belief system about their home and its value that are clearly not based in the realm of reality. That seems daunting and like too much work to do - as well, there are so many properties to see, and buyers have to invest so much time, energy and emotion in making an offer, they don’t like to do that in cases where the seller’s list price is so bizarrely above-market that the chances of coming to a meeting of the minds about price are slim.
If your home is dramatically overpriced, compared to the others in the area or compared to it’s market price range, most serious home buyers in the market for a home like yours will either (a) never come see it, because it doesn’t show up in the price range they are searching online, or (b) not come see it unless and until you drop the price, because it simply isn’t worth their time and energy until you correct your pricing into the realm of the realistic.
3. There are a whole lot of fish in the sea - I only have to find one. Agents and mortgage brokers talk to buyers a whole lot about compromising, and what they can expect on the market as a whole, and such. But my reality is this: home buyers are not in the business of market analysis. They are in the business of finding a home. Only. One. Home.
Yes, ultimately, every buyer has to make some compromises. No home is perfect, and every person who buys a home eventually gets that. But even in a heating market like the one we’re in right now, there are lots of homes coming onto the market every single day. Any given buyer only has to find one that works for them. To buy your house - any house - that buyer really does need to feel inspired by it enough to feel like it could work for their family, their needs and their life as their home.
If you take shortcuts when it comes to primping and prepping your home for the market, it becomes super obvious to buyers when they scrutinize it, even if it’s really priced well. On the other hand, the homes that were well cared for, prepared and priced shine above the others, at every price point.
4. If I nitpick your house, that probably means I like it. Every buyer’s broker has a horrific moment, at some point in their career, where they realize their buyer has been trash talking a home - its nasty wallpaper, vomitrocious carpet, silly stylistic choices, etc. and so forth - and the home’s seller has managed to overhear this diatribe. The pool boy who was at the property turns out to be the seller’s son, the sellers turn out to have been next door or in the basement through the entire showing, or the teddy bear-cum-Nanny Cam has advanced audio capabilities.
Here’s why this horrifies buyer’s agents: the buyer that goes to all that trouble to dissect precisely what they would do differently if a given house belonged to them is a buyer who is thinking about making an offer on that very house.
The more questions, critiques, nitpicks, “What I would do’s” and such a buyer rattles off about a home, the more likely they are to make an offer on it. Of course, the occasional curmudgeonly amateur designer likes to just rip other’s decor choices apart for the fun of it, but many otherwise lovely individuals do this when they get serious about a home as part of the exercise of visualizing the property as theirs, and envisioning themselves, their families and their stuff in it. This is how buyers take a place that might not be perfectly move-in ready for them, and figure out how they might be able to make it work.
So if you happen to overhear a nitpicky buyer dissecting your home and verbally tearing down walls or ripping up carpet, don’t despair. They might simply be mentally “trying on” your home as their home.
5. When it comes to staging, the bar is high. Really high. HGTV. Houzz. Architectural Digest. All these outlets which constantly publish beautifully designed and decorated homes have influenced what the average American expects their home to look like - and yours, for that matter. Additionally, all the do-it-yourself publications and shows along with the advent of home improvement stores which double as DIY design emporiums have given everyday people of modest means the power to live in beautiful and functional homes, without breaking the bank.
Beyond all this, professional home staging has taken off in recent years, as data has repeatedly shown that staged homes sell faster, for more, and more certainly than homes that are not staged, nor well-prepared by their owners. So not only is your home competing with the homes buyers are seeing on TV and in the magazines, it is also competing with professionally staged homes for sale right in your own neighborhood - homes that the very buyers who will come to see your home will also have seen, possibly right before or after they view yours!
So, if you want to and can afford to have your home staged, do. If you can’t, you should still take the preparation of your home very seriously, and include your agent or a stager you hire for an hour of advice in the process, taking their input on things like:
- what furniture to get rid of
- which improvements will get you the most bang for your buck with local buyers
- and what paint, flooring and other finish materials will appeal to the broadest buyer segment in your area.
Next week, it’s SELLERS’ turn to give BUYERS the advice they would if they could!
BUYERS: What other advice would you give to sellers, if you could, based on what you’re seeing on today’s market? Let’s be diplomatic and constructive, please.
ALL: You should follow Tara and Trulia on Facebook.
5 Crime Questions to Ask Before You Buy a Home
Posted Under: Home Buying, In My
Neighborhood, Property Q&A | February 20, 2013
12:35 PM | 92,215 views | 56 comments
The list of question every buyer asks about the various properties during a house
hunt is relatively predictable. How many bedrooms does it have? Baths? Square
footage? What are the HOA dues? What’s the school district?
Then,
we get more specific, personalizing the questions based on our own vision,
aesthetics and lifestyle needs: Can that wall be moved? Is there space for
Grandma’s dining room table? Is there a shady spot for an orchid house in the
backyard?
When
it comes to crime, most of us simply don’t ask any questions at all, as (a)
agents might be prohibited from doing much beyond pointing us to law enforcement
sources, and (b) we tend to assume most neighborhoods are either ‘good’ or
‘bad,’ low-crime or not. The truth is never so black and white. Fortunately,
technology has made it easy-peasy for us to get a deeper, more nuanced, and more
usable understanding of the crime that takes place in our neighborhood-to-be,
which in turn allows us to make smarter decisions about which home we buy and
how we live in it, once we buy it, than we could have even ten years
ago.
The
key to tapping into this nuanced crime information is asking the right
questions. Here’s a short list of the right questions to ask about crime before
you buy a home.
1.
Do any offenders live nearby?
In most states, Megan’s Law and similar provisions mandate that certain
individuals with histories of criminal convictions must register their home
addresses with local authorities, who in turn are required to make this
information available to the public. Google “your city, your state Megan’s Law
registry" to find sites where you can type in an address (like the address of
the home you’re considering buying) and find a list of registered sex offenders
in the area. Many of these sites will also offer you a map showing your address
and the relative locations of the homes of the registered offenders.
The
reality is that every neighborhood - even very upscale areas - has someone
living in it who has committed a crime in the past, so don’t completely freak
out if you happen to find someone in your neighborhood-to-be with a history of
sex offenses. The utility of this information is that it empowers you and your
children to recognize these dangers and to take care to avoid hazardous
situations. That said, if you happen to have young children and notice that the
Megan’s Law map has a halfway house with a dozen registered sex offenders living
right next door to your target home, that
information might change your decision about whether that property is the right
one for you.
There
is also power in following the path of the information you are given on these
registry sites. Many will surface information like what the registrants’ crimes
were, when they happened, the registrants’ photos and more useful intelligence.
This information can help you evaluate the degree to which you should be
concerned before you buy.
2.
Was the home a drug lab? You
think your home’s former owner’s food or pet smells are toxic? That’s nothing
compared to the truly unpleasant and health-impairing effects some have
experienced after buying a home that turned out to have been a methamphetamine
lab in a former life. If the sellers know this about a home, they should
certainly disclose it. Unfortunately, many of these homes end up sold by banks
as foreclosures, or by estates, trusts, landlords or other corporate owners who
don’t know the home’s past - or don’t have a legal obligation to disclose it.
Get
the answer to this question to the best of your ability via this two-step
process:
(a)
talk with the neighbors - they often will reveal whether the house had a shady
past, then
(b)
search the federal Drug Enforcement Association’s Clandestine Laboratory
Registry, here: http://www.justice.gov/dea/clan-lab/clan-lab.shtml.
3.
What sorts of crimes happen in the area. Where and when do they happen? Crime
happens virtually everywhere. But the details of crime patterns vary widely in
various neighborhoods. One side of town might be plagued with an overall low
crime rate, but the crime that does happen tends to be violent crime after dark.
While another neighborhood across town might have lots of car break-ins during
the day while people are at work, but not much going on after residents get back
home - and not much violent crime at all.
This
sort of information can be highly useful to a buyer-to-be, as it can help you
make decisions not just about whether or not to buy, but also about whether to
park your car outside (or not), whether to get an alarm and where in a given
neighborhood you might prefer your home to be (e.g., interior cul-de-sac vs.
thoroughfare in the same area).
Trulia
Crime Maps
offer precisely this sort of nuanced information, allowing you to view your town
and neighborhood’s crime rate in heat map format showing the relative violent
and non-violent crimes that have taken place recently in different parts of
town. It also provides information on crime trends, in terms of the frequency of
criminal activity taking place at various hours of the day, and the most
dangerous intersections in your town or area. SpotCrime.com
offers another angle on nuanced crime data, breaking down crime types with
easy-to-scan icons and providing data for communities all over the
country.
4.
What anti-crime features does - or can - the home have?
Review your disclosures and talk with the sellers (through your agent, of
course) about what anti-crime features the home currently has. This will allow
you to prepare for any upgrades, downgrades or changes you’ll want to make. For
example, if a home has security bars that were installed 3 decades ago, you
might want to have them brought up to code with a fire release bar, or removed
altogether. Or, perhaps the sellers currently have the home wired for an alarm
that can be armed, disarmed and video monitored remotely - if you want to
continue that service, you’ll need to get that information and make the account
change when you take over the other utilties and home services.
On
the other hand, the home might not have any anti-crime features. So, if there
is a particular alarm or monitoring system you like, it is smart to check in
with that provider before close of escrow to find out whether they can provide
services to the new addres and, if so, what it will cost and take to equip the
home and start service up at closing.
5.
What does the neighborhood do to fight crime - and how can I help? Neighborhoods across the country fight and prevent
crime the grassroots way, by maintaining strong connections between the home
owners and neighbors who all have in common the desire to live and raise their
families in a safe, secure, thriving place. Don’t hesitate to ask your home’s
seller and/or any neighbors you talk to about whether there are any neighborhood
associations, neighborhood watch groups, email lists, social networks, regular
meetings, block parties or other community connections in which you can actively
participate. ALL: Did you ever omit to
ask a crime-related question about a home - and later come to regret it? Do
tell. ALL: Follow Tara and Trulia on Facebook!
4 Reasons to Write a Real Estate Love Letter: When, Why and How to Express Your Emotions About A Home
In
a world where an ”XO” text message or Facebook relationship status change
signifies deep emotion, the long-form love letter seems to be a dying art. So it
is somewhat surprising that the seemingly cut-and-dry,
numbers-and-negotiation-riddled realm of real estate is one of the last bastions
of the love letter.Many agents advise both their buyers and sellers to keep a calm, cool and collected demeanor throughout the transaction, out of concern that demonstrating emotion will spark greedy sentiments and advantage-taking desires in the hearts of the folks on the other side of the table. And there’s truth in this: walking into a house and salivating is never advisable. But there are some times when putting your heart on your sleeve - and your pen to paper to express your love for a home you’re buying or selling - is just what your transaction needs to bring things together and get you the results you want.
1. Seller → Buyer: Video Love Letter. Your agent might be telling you that video is THE NEXT BIG THING in marketing a home. And you know what? They’re right. In a recent survey of house hunters, 70 percent cited “touring a certain home” as their reason for viewing videos in the course of their search for a home - and 86 percent said their purpose for watching a video was to learn about a particular area. Fifty-one percent of them pointed to YouTube as their primary video source.
Many home marketing videos are simple tours of the property. But what makes a video a love letter expressing why you love the house (and why a buyer will, too) is ensuring that the swoon-worthy features of the home actually make it into the video! If you have a delightful backyard, have the videographer shoot it alight at night, as well as during the day. If there are custom built-ins, high-end appliances or secret spaces with smart organizers inside - there should be shots of these things, rather than just a couple of broad sweeps of the camera across the room.
If your neighborhood is the epicenter for local shops, farmer’s markets and such, have the videographer incorporate and label shots of these things - ideally after the footage of the house - to paint the fuller picture for the viewer of the full experience of life in your home. If you’d like to do some sort of personal narration about how much you have loved living in this home, and expressing heartfelt best wishes for the next owner, that can be a nice touch - but keep it uber-short.
Work with your agent to be sure the YouTube description of your video includes a link to the home’s Trulia listing, and vice versa. Also make sure the name of your town, neighborhood and “home for sale” appear in the YouTube description of your video love letter about your home, to make it more likely that the right folks will find it when searching the web.
2. Buyer → Seller: Multiple Offers. So, you finally found the one. Perfect porch - swing included. Coffee shop downstairs in the building. Gingerbread-laden Victorian ready for fixing. Whatever floats your boat, as they say. The only thing is, there are about 5, 15 or 50 other people who think this property is their one - and all of them are making offers to buy it.
As a buyer, there’s no better time to write the seller a love letter about their home than when you are competing in earnest with other offers. (Logistically, this is something your agent will include when they submit your offer and loan approval documentation.)
In fact, the love letter should briefly explain why you like their home, but it should also go into more detail about your love for your family, your life, your career, your town, etc. and why you think their home is the perfect launching pad for the next stage of all of these relationships. It is not overkill to humanize yourself or your family by including a photo - pics of babies and dogs go over well, though some agents feel that photos can work against you in cases of an ornery or biased seller.
That said, it’s essential to think through the multiple offer love letter in the overall context of the fever-pitched negotiations. Will a love letter help you beat out offers of tens of thousands of dollars more than yours? No, it won’t - so it’s essential that even if you do write a love letter, you still make your most competitive offer, price-wise, in light of the comparables, your budget and your level of desire to secure the place.
So what, then, is the advantage you gain from writing a love letter? It might get you a counter-offer when you would normally have gotten an outright rejection. It might get you the leg up on a buyer offering the same amount of money, when the seller is already aware that that dollar is the most the place will appraise for (so countering for more is not a great option). And it might get you some seller graces and above-and-beyond cooperation later in the transaction, like furnishings thrown in or time extension requests granted, if you are the victorious winner. So, for something that costs nothing, it might just be worth it, even if the chances it will help you best a buyer offer thousands more than you are between slim and none.
3. Seller → Buyer: Written Home/Neighborhood Love Letter. It should be clear at this stage of the game that your house will need to speak for itself - it’s location, condition, price and even staging create a holistic package that buyers will scrutinize in evaluating whether or not it’s a love match. But when you have a beautiful home in a fantastic neighborhood, it can still be a powerful thing to have a love letter about your home and neighborhood, with a few other extras, sitting in a binder on your counter.
Buyers fantasize about how happy their families are and will be in the property - so letting them know about the years of joy your family has experienced there only adds to the good vibes.
Buyers might not know all the charming, fun or convenient amenities your neighborhood has to offer. I have lived and run in my neighborhood for almost four years, and just stumbled across a new secret staircase into the park by the lake last week! If your home is otherwise likely to be sought-after by hikers, dog-walkers, foodies or film buffs and your neighborhood has amazing offerings for those types of folks, say so in your love letter. I’ve seen an amazing binder filled with a family’s love letter about their home, their neighbors and their neighborhood, complete with a list of all their favorite neighborhood vendors, restaurants, the names and numbers of their housekeeper and gardener - and even some menus from the restaurants that deliver to the address!
Many listing agents are starting to include any pre-listing inspection reports and disclosures in a binder that remains in the property during showings, as well as being emailed to buyers’ brokers in digital format upon their request. These “disclosure packets,” which tend to increase the chances of getting an as-is offer up front, and reduce the chances that the buyer will try to renegotiate mid-stream, are a great spot to include your love letter and any supporting materials. If there’s something that needs major fixing in your home, and you want to explain anything about it, this might be a good place. If you’ve invested thousands in upgrading it, this is a good place to brief the buyer on that, too.
Work with your agent to create a strategy about what details to include, and make sure your agent signs off on the final version before you put it out for the world to see.
4. Buyer → Seller: Unlisted Home. Did you ever see the War of the Roses, with Michael Douglas, Kathleen Turner and Danny deVito? At the beginning of the Roses’ ill-fated marriage, they found a storybook home that wasn’t on the market by stalking it, writing a note to the seller and ultimately, being in the right place at the right time when the elderly seller passed away.
This sort of thing does actually happen, on occasion, in real life - a buyer actively pursues a home that is not for sale, simply because they love it, and the seller agrees to sell. This is tricky territory, as often:
- buyers seeking an unlisted home can be seeking to get an infeasibly low price or seller-financed deal, which the seller has no reason to accept (i.e., before accepting a lowball offer, the seller would put it on the market)
- sellers simply have no interest in selling the place, or they would have it on the market
- some scam artists send seemingly handwritten letters to sellers en masse, making them skeptical of the occasional legitimate buyer who writes them a love letter
- sellers might have unrealistic expectations about what they should get for the home, or only be willing to sell for top dollar
- there are legal restrictions in some states on making proactive approaches to home sellers who are behind on their mortgage or in some state of foreclosure, which wanna-be buyers should take care to observe (a quick consult with your own broker or a real estate attorney is in order, before you send a seller a love letter on an unlisted home).
That said, if you’re looking for a very unusual type of property in a market where few are sold (e.g., an equestrian property near the city) or there are only a few homes in your area that fit your specifications, it’s not a bad idea to submit letters putting sellers on notice that you are interested in their property and would love to discuss buying it. If the seller does bite, you would be well-advised to bring a broker, attorney or title/escrow professional into the transaction to ensure that everyone’s rights are protected and responsibilities are met in the course of the transaction.
Buyers (Past and Present): Have you ever written a love letter about a seller’s home? Did it work? Have you ever read one? Did you find it compelling?
Sellers (Past and Present): Do you have a success story about using a love letter - written or video - to help sell your home? Do tell!
Agents: What advice do you give your clients on best practices for timing and content of property love letters?
All: You should follow Tara-Nicholle and Trulia on Facebook!
The Art of the Dream House Hunt: 5 Intangibles Every Dream House Has
Posted Under: Quality of Life,
Home Buying, Moving | February 7, 2013 5:10 AM
| 59,721 views | 48 comments
Across
the pond in the U.K., hundreds of stately homes are known by the average
person,
by name. But here in America, there are only a handful of houses that most
people consider iconic: the White House, Hearst Castle and for reality TV fans,
Spelling Manor, among them.But there is one more house that virtually every American of almost every age instantly recognizes by name: Barbie’s Dreamhouse. As of today, this iconic property has been listed for sale, right here on Trulia.
Take one look at the listing, and you’ll see precisely why someone with Barbie’s elevated taste level would deem this Malibu beachfront home the house of her dreams. But what about you and your hunt for your own personal Dream House? The occasion of Barbie’s Dreamhouse going on the market seems like an ideal time for us to explore exactly what features make a property that you’re considering a good candidate to be your own personal Dream House.
As I see it, most Dream House features are intangible and will differ from house hunter to house hunter. But this list of “intangibles” is a useful set of guidelines to think through as you peruse listings online and go visit them, in real life:
Dream House Intangible #1: It’s “right-sized.” Your personal Dream House might not be Barbie-sized (3 floors and 8,500 square feet, to be precise), but it will be “right-sized” for you, your family and the activities you want to do regularly in the home. This is a shift from the days in which the conventional wisdom said that more square footage was always better, even if you weren’t going to use it.
A too-small home is obviously uncomfortable, contributes to clutter (both material and mental) and can even cause tension in the relationships of the people who live in the home. But a too-large home for your family can be a major drain of time, energy and cash when you consider what is required to furnish, heat, cool, clean and maintain it. As well, a home might not be “right-sized” if it is full of square footage you will never use because of poor design or flow, like a living room so cut off from the rest of the house that no living ever gets done there, or a formal dining room in a home where everyone prefers to eat in the kitchen.
Smart Dream House hunters look for homes that are neither too big, nor too small, for their needs in the foreseeable 5 to 7 years -- longer if you plan to stay in the home for a longer time period. That means that to understand what would render a particular property right-sized for you, you must consider upcoming probable changes in your family status, family size and the increasing space needs of aging children, young adult children who might return home and even aging parents who might want or need to live with you in the not-so-far-off future.
Dream House Intangible #2: There’s a lifestyle-house match. Related to, but different from being right-sized, your Dream House will be one that matches up nicely with your lifestyle. In particular, the ‘who’ and ‘what’ of your life must be a good match with the features, floor plan and location of a home for that property to hit Dream House status. That can mean many things, depending on “who” does and will live in the home, and “what” activities make up their lifestyle, for example:
- the Dream House of a family with four children might need to be in a great public school district
- a retirement-aged couple might find their Dream House to be one level
- an extended family might find their Dream House has a full bedroom with en suite bath on the ground floor, for the grandparents
- a young couple’s Dream House might have the ability to rent out a room or backyard cottage to help make the mortgage payment
- a growing family’s Dream House might have discrete spaces for Mom’s office, the kids’ study areas, Dad’s shop and even other activity areas for various children’s hobbies and pursuits.
At a glance, these things seem obvious, but many a home buyer only realizes the critical importance of lifestyle-house match once they are moved in and paying the mortgage on a house that:
- requires much more weekend fixing than they have time or budget to do
- turns out to be noisier or more burdensome, in terms of the commute to work, than expected
- is difficult for family and friends to come visit, because of steep entry stairs or paltry guest parking.
Here’s a right-sizing exercise that also boosts the chances your lifestyle and Dream House will match up: before you even get out and start looking for a home, sit down alone or with your family and do a hypothetical “audit” of all the rooms of a prospective property, envisioning what people and activities will go where. And be creative - don’t think too literally about the name of a room as a limitation on what you can do in it:
- do you really need a separate room with a closed door for an office, or will a neat nook with an efficient desk system do just as well?
- can you carve up a great room into areas for cozy couch conversations, TV-watching, kids’ play and kids’ homework?
- can you repurpose a dining or living room into an office or work area, if someone needs that?
This way, you can make sure you have enough space -- and the right kinds of spaces -- for every who and what that needs to “live” in your Dream House.
Dream House Intangible #3: It provides vision fuel. A Dream House is one that allows you to envision a number of exciting upgrades to your every day life, made possible by the house. To be clear, no house has the power to make your life perfect; I mean, even Barbie’s near-perfect palace only complements her wildly successful careers and uber-gregarious social life (hence, her need for a 15-person rooftop hot tub).
That said, there are a number of ways your choice of home can help you real-ize your dreams and be a suitable environment for your vision of the future of your life. For example, urban farmer wanna-bes can select homes that will allow them to flex and foster their burgeoning green thumbs or raise the chickens, goats or bees they envision keeping. And buyers-to-be who dream of having their own businesses can pick properties that have the space for the office, nook, inventory storage space, jewelry workshop or client meeting area they will need to make a go of it - not to mention upgraded electrical or other infrastructure they will need (or at least the ability to install it after closing without breaking the bank).
Maybe your vision for the next phase of your life is focused on relaxing and traveling more, so your Dream House is a low-maintenance condo near the coffee shops, yoga studios and restaurants you love. Or perhaps your vision for the next decade is focused on family and career, so that a suburban home near great schools, with a large yard and an easy commute to work will constitute your personal Dream House. Cultivating clarity on your vision for your life before you start your house hunt is essential, if you’re aiming to buy your Dream House.
Dream House Intangible #4: Staying power. I’ve already alluded to this, but it’s important so let me state it outright: given the still-recovering state of today’s economy and real estate market, it’s important that your Dream Home be one you can see yourself living in and being comfortable with for at least 5-7 years. In fact, if you live and are buying a home in a place that was especially hard hit by the recession, it’s wise to choose a property that will work for your family for even longer, just in case you need to stay put while the market slowly recovers.
I personally witnessed at least three home owners in my own circle lose or walk away from homes when, within the 5-year span from top to bottom of the market, they went from swinging single loft-living to having full-blown, young families for whom living in a loft was actually a hazard. Whether you know you’re likely to pair up and/or have kids in the next handful of years or you know you’ll want to downsize or relocate, your Dream House is one that will accomodate both the present-day you and the you you’ll be in the next few years.
To be clear, I’m not suggesting that you buy a home for 15 or 20 years down the line, necessarily, just that you project your space and geographic needs out for the upcoming few years so you don’t end up in a place where you either have to (a) move or (b) hate living there in the pretty foreseeable future.
Dream House Intangible #5: Resale Appeal. Barbie’s Dreamhouse is clearly Barbie’s Dreamhouse, as is clear from the fact that it is personalized throughout in her signature pink (note the pink elevator!) But the fact is, colors are cosmetic and can be easily changed by the next buyer to suit their own tastes. Dream Houses, as a rule, are homes that are easily personalized by whoever owns them at the time, and are not so heavily structurally customized that they lack appeal to a broad segment of buyers.
Overly customized homes, especially those without other compelling features that many buyers will see as dreamy, can be difficult to sell. Being stuck in a home when you want or need to sell it is not a dream, it’s a nightmare.
On resale appeal, Barbie’s Dreamhouse scores, both in terms of being easily personalized by the next buyer and in having dozens of other hard-to-find features that will appeal to nearly every Malibu house hunter with $25 million at hand. Most buyers in this segment of the market and this location will have more than a little hankering for beach frontage, unobstructed views and the utterly glamtastic luxury master suite features that Barbie’s place has in spades - steam shower, heated floors and self-flushing toilet, among them.
BUYERS: What intangibles are you looking for in your Dream House?
OWNERS: Have you ever bought what you considered your Dream House? What made it so?
ALL: You should follow Trulia and Tara on Facebook. And you should definitely check out the listing for Barbie’s Dreamhouse - it’s the definition of dreamy!
3 Ways Real Estate Goes Rogue - and How to Weigh the Risks and Rewards of Rogue Behavior
Sometimes
in life, going rogue is what you do when you have an independent spirit or when
coloring inside the lines isn’t getting good results. Other times, to go rogue
is to veer into the danger zone, beyond the boundaries of what is safe or will
get you to your desired objective.Some things are so high stakes, the potential for massive rewards motivates people to go rogue, but the potential for massive risk cautions the wise person not to. Things that fall into this high stakes category, in my humble opinion, include cosmetic surgery, base jumping and, yes, real estate.
Let’s take a deep dive into some of the ways real estate can and does go rogue, and help you understand just when the risk is worth taking - and when safety is the better bet.
1. The “rogue” buyer’s agent. The rogue agent is the one who is constantly going entirely off the charts from what you’ve laid out as your criteria for a home. The one who shows you a house in Parkview when you said you wanted to live in Oakview; the one who shows you a 2 bedroom when you insist you need 3; the agent who shows you condos when you’ve asked to see single family homes - and vice versa.
Sometimes, a rogue agent can frustrate a buyer, especially when there is urgency to finding a new home, when your time for house hunting is tight, or when the homes they are showing appear to have nothing that would cause the agent to reasonably expect that you might be inclined to make a compromise. Working with a rogue agent can also be frustrating when you feel like you’re simply not being heard.
But in my experience, more often than not, there’s method to a so-called “rogue” agent’s madness. Some agents go rogue when there’s a real disconnect between a client’s asks and their budgets, in which case they aren’t going rogue at all but, rather, reality-checking you on what you can get for your money in your market (whether or not you are inclined to shoot the messenger). Other agents go rogue when they’ve really listened deeply to the picture you’re painting of the lifestyle you want to live ‘after’ you buy, and they have reason to believe the homes they are showing you can create that better than what you’ve asked for. Still others go rogue when they come across a unique opportunity they think you might love - frankly, part of the advantage of working with an agent in the first place is to have someone watching aggressively for opportunities that come on the market that you might miss for one reason or another.
Risk vs. Reward: The risk of working with a truly rogue real estate agent is really the opportunity cost - all the homes you might be missing out on if your agent just won’t listen to what you have to say. But there is incredible potential upside to working with a “rogue” agent if they fall into the following categories:
• who is willing to break the truth to you, no matter how hard;
• who is willing to think creatively and draw on their own experience to bring you creative solutions to your housing needs; and
• who always has you in mind as they see unique opportunities in the market and will surface them to you when they come up.
Before you get upset with an agent you think has gone rogue, make sure they’re not actually just trying to do one of these things.
2. Disclosure debacles. Some sellers, given the traumatic nature of the market over the past few years, get worried that a laundry list of little fixes, nicks and all the “minor” repairs that have been done over the years they’ve owned the home will scare off a good buyer or will otherwise ruin the deal. Occasionally, one of these sellers goes “rogue” by deciding not to mention a few “little issues” they have had with the home.
Reality check: a disclosure you might see as minor could be the trigger that makes a buyer’s inspector dig deeper into a particular item - it could even cause the buyer to order an inspection they wouldn’t have otherwise. And, yes - this does increase the chances that a buyer will find something wrong with the place during escrow, and maybe even increase the chances that they will ask for a price reduction or repair credit to close the deal. But most buyers just want full information so they can make a decision about whether and how to move forward - so, chances are also good that the buyer will find nothing wrong at all, or will find something wrong with the place and move forward on the original terms - or maybe will offer to split the difference on the repair costs; the potential outcomes are many.
But you know what? Giving a buyer true, full disclosure also vastly decreases the chances that they will come back and sue you years down the road, when something goes wrong that they might have been able to find if you had disclosed your little plumbing peccdilloes up front. What’s way more expensive than splitting the difference with your buyer on a sewer line replacement? Paying court fees, arbitrators and attorneys to sort it all out five years down the road.
Risk vs. Reward. When your grandmother taught you that honesty was the best policy, she was unwittingly giving you the best real estate advice there is. There’s simply no contest here - the risks of non-disclosure so far outweigh any possible reward from skimping on the house history that smart sellers err on the side of overdisclosure every single time.
3. HOA hijinks. The potential for drama within a homeowner’s association (HOA) is a specter that looms large in the nightmares and worst-case scenarios of every condo-considering house hunter and many owners of townhomes, condos and even standalone dwellings located in HOA-managed subdivisions. And because an HOA is simply an organization made up by actual homeowners, the hijinks and rogue behavior can flow in both directions!
HOA’s themselves can go rogue, so to speak, by:
• failing to appropriately budget for upcoming repairs and expenses
• levying unexpected assessments
• increasing dues beyond what an owner might think is reasonable
• failing to enforce regulations - or being overly restrictive in enforcing regulations - about any subject from paint colors, to flooring materials, to pets allowed and noise controls.
And home owners can - and do - go rogue on their HOAs, as well, including when they:
• default on their HOA dues
• default on their mortgage payments or
• intentionally or egregiously violate the same sorts of regulations described above, terrorizing their neighbors and fellow HOA members.
Risk vs. Reward: The risks of defaulting on your obligations to your HOA are steep - namely, your HOA can - and many will - send your past due dues to a collection agency, impairing your credit, and after prolonged non-payment, they can even foreclose and repossess your home. Similarly, violating your HOA’s formal rules, even if you think they are unfair, is foolhardy - it can result in a range of issues from a daily fine for having an impermissible pet to a court order requiring you to pull out the hardwood floors that were barred by the HOA guidelines and which made a thunderous sound in your downstairs neighbors’ place with every single step.
How can you minimize the risk of a rogue HOA? By vetting the Association completely before you buy, which includes a complete reading and review of the lengthy HOA budget documents, account statements, insurance certificates, board meeting minutes, newsletters, regulations and other documents every HOA home’s seller is required to disclose to a buyer, by law. Talking to the unit or home’s neighbors, and understanding how many units are delinquent on their dues or in a state of foreclosure doesn’t hurt either.
Your better bet, if you disagree with the fairness or wisdom of your HOA’s rules, is to apply for an exception or contest the rule, publicly, via your HOA Management company or an appeal directly to the board. Truth be told, your best bet in avoiding HOA Hijinks overall is to read the newsletters and board meeting minutes, attend board meetings, stay in touch with your neighbors and even run for a board membership.
ALL: Have you ever witnessed real estate gone rogue?
ALL: You should follow Trulia and Tara on Facebook!
4 Ways to Hater-Proof Your Home, Before You List It
In my experience, there’s one fundamental truth about
haters: you can never fully escape them. The only way to live a 100% hater-free
life is to never stick your neck out, and never do anything because, as the
saying goes, you simply cannot please all of the people all of the
time.And this is particularly true with real estate and putting your home on the market - because homes, locations, aesthetics and such are so much a matter of personal preference, some people will find something to criticize about even the most perfectly staged, priciest properties on the market.
As a home seller, your job is not to try to make your home be all things to all people. That said, you don’t want to be the house that nearly every buyer and broker sees, rolls their eyes and utters the same few, predictable deal-killing criticisms. Fortunately, what is predictable is avoidable. Let’s explore the most common things buyers hate about listings they see. In the process, you’ll get equipped to sidestep those issues and, in large part, hater-proof your own home.
House Hater Complaint #1: Odors. Some of you might think I’m beating a dead horse, here. But as long as house hunters keep emailing me to ask why, in the name of all that is sacred, they keep seeing homes that smell like all sorts of madness and mayhem, I’m going to keep repeating this message.
Viewing a home sounds like it’s all about the visual of the experience. And visuals are critical - your home should be in its Sunday best, so to speak, when it’s being shown, in terms of being spruced, staged and clutter-free. But when a buyer comes to see your home, they don’t turn off the rest of their senses. And there is nothing that can turn a buyer off from a home, they’d otherwise like, quicker than a powerfully bad odor - in particular, cigarette and pet odors in a house that seems to have been well-cleaned create the concern that they might be permanent and that the buyer might not be able to get rid of them without dropping some serious cash on cleaning or even removing wall, window and floor coverings.
If you are a seller and you know that someone has been habitually smoking in your home or that you have had a “challenge,” let’s say, with pet accidents, do not ignore the problem. And do not think that because you had the carpet shampooed or the drapes cleaned, or because YOU can’t smell anything, that the problem is gone. The fact is that the human sense of smell very quickly gets used to smells that it lives with or is surrounded with on a regular basis. So it’s critical to get your agent, stager or even your friends and family members - who don’t live with you and love you enough to be honest! - to help you detect bad smells and odors, and make sure they are eradicated by any means necessary, before you place your home on the market.
House Hater Complaint #2: Glaringly extreme overpricing. There’s the kind of overpricing that makes a buyer say, “Hmmm - seems a bit high. Let’s go see it, but we might have to offer a little less than the asking price if we like it.” Then there’s the kind of overpricing that makes buyer say “I’ll wait until a price reduction” or worse, hold their sides from laughing.
When overpricing is glaring, many buyers and buyer’s brokers will comment on it or inquire about it. What they are less likely to do is actually come out and see the place - especially if they weed it out online after comparing its specs to all the other homes in the area and the price range. Often, homes this severely overpriced simply don’t sell, or not until after they’ve had some serious price cuts or have been on the market so long buyers begin to feel confident about making lowball offers.
In fact, the goal is the opposite - you want your home to stand out as a property that is not dirt cheap, but does present a good value for the money - that’s what motivates buyers to get out of their chairs and into the property for a viewing.
Here’s how to hater-proof your home’s listing against this issue: fixate on the comps. Smart sellers deactivate their emotional attachment and very human tendency to overvalue their precious homes by poring over the sales prices (not list prices) of similar, nearby homes that have recently sold. Your agent will be happy to help you walk through this data and will almost certainly recommend a list price, but ultimately you make the decision about the price point to list your home at.
Also, consider using your broker’s first Open House as an additional hater-proof measure: if the agents overwhelmingly comment that they think the home is significantly overpriced, listen.
House Hater Complaint #3: Dirt and messes. Possibly the single largest source of House Hater Complaints I’ve ever heard are the dirt, messes, piles and personal belongings that buyers find so distracting, when they walk into a home for a viewing or Open House. Obviously, homes that are filthy from floor to ceiling are fertile fodder for haters, but often those homes are bank-owned or otherwise distressed so that the sellers aren’t likely to do much. What is underestimated is how often even savvy home buyers are distracted (and disgusted) by relatively clean homes that just have a few outstanding messes, like piles of dirty dishes in the sink, piles of dog poo in the yard or even piles of papers, mail, books or clothes lying out in plain view.
Will one or two such items ruin the sale of your home? Perhaps not. But a few of them (or more) can certainly distract a buyer enough that they fixate on your messes and, in the process, fail to see what is so great about your property. And as I see it, cleaning up, meticulously, before every single showing is free - so it makes no sense to even run the risk of turning off a prospective buyer by letting messes get in the way of their ability to visualize themselves and their families flourishing in your home.
House Hater Complaint #4: Lots of little malfunctions. All of us tend to think our homes are in fantastic condition. After all, you have the furnace maintained regularly, you’ve got granite and dual paned windows - maybe you even had the floors refinished or the walls painted in preparation for putting your place on the market.
That’s all fantastic - all the non-cosmetic work you’ve done to maintain and improve your home should be trumpeted in your marketing materials, and the cosmetic items will (or should) speak for themselves. But here’s the thing: buyers who visit your home won’t be running your dishwasher or testing the furnace (at least not until inspections). What they will do - almost unconsciously - is:
• flick light and fan switches
• open or close window coverings, closet, room and entry doors,
• open and close drawers, cupboards, gates and fences and
• hold the handrails as they walk up and down the stairs.
They will hear leaky faucets and point out water spots from long-ago repaired leaks, and they will notice (or potentially trip on) uneven exterior tiles, paths and walkways. And even though these items might be vastly less expensive to fix than the roof or sewer line you had replaced, they are much more visible and noticeable to a buyer. In fact, buyers don’t always even know that the little malfunctions and repairs that need doing are little or inexpensive. And when they notice a bunch of these sorts of things in a single property, they can jump to the conclusion that the whole place is rickety.
Since these little fixes are inexpensive to make, have them completed before you list, if at all possible. You might even ask your agent to walk through the property with you and to give you a handyperson reference for someone they know works efficiently.
Agents and Buyers: What things have you encountered in multiple listings that make you cringe, eye roll or otherwise immediately dismiss a house?
ALL: You should follow Trulia and Tara on Facebook!
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