While I have walked into thousands of houses during my seven years as a Realtor and only three things make me want to immediately turn around and leave a property.

1. A scary looking dog in the front yard.
2. A house with no air conditioning on a 100 degree day.
3. A bad smell inside.

Typically there are two smells easily recognizable:  smoke and pets.  If you list your house, go outside to smoke.  Make an effort to get rid of the existing smell as well.  Paint, wash the curtains, shampoo the carpet, mop floors, wash blankets and bedspreads.  And - again - go outside to smoke.  Also remember to empty the outdoor ashtrays before showings because… gross!

Pet smells are a little more difficult to deal with, but thoroughly cleaning the house - and we’re talking DEEP CLEANING - is a good first step.  Like cigarette smoke, you may need to wash curtains, bedspreads, and other fabrics or surfaces that hold smell.  Once the house has been deep cleaned, vacuum every night AND be sure to give your dogs regular baths so if they have to be inside, their odor won’t be as strong.

Change the kitty litter often.  And by often, do it EVERY DAY… we’re talking the scooping kind of litter.  The odor of what cats leave behind in their sandboxes is just disgusting.

Walking into a house with a bad smell is a huge turn off for buyers.  Don’t fool yourself into thinking that it’s not that bad because if YOU smell it, it will be ten times worse for the buyer.

This youtube video is labeled as an “actual” virtual tour and demonstrates what *not* to do when setting up an online tour of a home.

I actually take a multitude of photos of my listings, then set up a nice tour on Animoto.com.  If you haven’t found that site yet, don’t walk but RUN to use it.  Amazing, it is!

About five years ago, real estate was selling at a very fast clip.  Housing prices were growing by about 4 percent every year and it took but a little wheedling with an appraiser to make the contract value stick.  But five years before that, housing was fairly steady.  Values did increase, but at a more moderate rate of 1 to 2 percent per year.

Given that values grew by about 20 percent in a five year stretch - what would’ve taken 10 years to do previously - and given that values have dropped by about 20 percent across the nation (30 to 40 percent in some places), I expect the housing recovery to take about 10 years in all.  This is not based on any economic studies or actual hard numbers.

The bottom line is that the old way of selling homes - absent a run on houses by buyers because of easy loans - is the new way.  Buyers must save a down payment, they might expect to again pay closing costs (depending upon the seller), and they’ll have to verify they have job security before being approved for a loan.

Through the next five to eight years, I anticipate the housing market to be like it was in the 1990’s.  If sellers were able to sell then, they can do it now.  If real estate agents were able to make a living then, they can do it now.  And if buyers could save then, they can do it now.

To save, buyers may need to take on a second job for a year or two.  To sell, home owners may need to be realistic about their pricing.  To keep clients happy, real estate agents will need to pay attention to the details, respond to all aspects of a contract in a timely manner, and remember to stay in touch with their customers.

Everyone must find a way to walk the path of the new way - the old way.

When Grandma or Grandpa pass away, it’s easy to assume the executor of the estate makes all the decisions on selling the home.  While this may seem true, it usually is not.

If you are thinking about listing the estate home, make sure first that it goes through probate.  This process merely means that the courts have approved the will (or how to proceed if there is no will).  After this, the home can be listed but make sure that ALL the heirs sign the listing agreement before it goes on the market.  Do not just let the executor place it for sale.

When a buyer is found, again all heirs should review the offer and sign off on it.  If not, at closing one person may say, “Nope! I’m not signing unless I get XXX.”

That one stubborn mule may cause the entire transaction to fall apart.  By having everyone sign the listing agreement and the purchase contract, concerns would then be addressed at the beginning rather than the end of the process.

Have a good weekend, Shak & Jillers!

Photo by Valerie’s Genealogy Photos via flickr creative commons.

I tell buyers and sellers that when an offer is on the table, both parties have three choices:  Yes, No, or Maybe.  The preferred response - of course - is Yes or Maybe.  When a seller comes back with “No” the negotiations are done, ended, vamoose.

My friend Elizabeth from Huntsville, Alabama demonstrates the point with a story she shared today about her buyers last year and where the sellers are today after they soundly rejected an offer,

My buyers have now built their dream home across the street from this very home. …For less than they were willing to purchase that home for.  The declined offer home has not yet sold and is now on agent number 2, with a $61,500 price reduction.  My buyers offered them more than they are now willing to sell for.  Pride got in the way.

Never say no if you’re serious about selling.  Never let a thousand dollars price difference prevent you from buying or selling a home.  If you’re a buyer, paying $1,000 more is about $6 p/month more… a lunch at McDonald’s.

Put aside your pride… some things are bigger than that.

For a house listed at nearly a million smackaroos, why why WHY would a seller submit this photo?  To show that it’s fun to four-wheel at the house?  Especially with no helmet?

One thing for sure… when you choose to list for next-to-nothing compensation with a company located out-of-state, you get what you pay for.

The value of a swimming pool is priceless during the hot summer months when the kids are home from school bored, after you’ve mowed the lawn and are covered with sweat, or when the family comes for a two-week vacation visit.

The value of a swimming pool - as told by pool salesmen - is about $15,000 to $50,000.

The value of a swimming pool when you’re spending hours cleaning it, spending dollars on the chemicals, or spending money on liability insurance is a whole different story.  The value of a swimming pool when you’re selling your home is also another story.

Kitchen and bathroom makeovers add the most to the resale value of a home.  A swimming pool is may be nice to lounge around in the summer, but for resale it’s a perk that just doesn’t always add up.  I’ve looked at homes with buyers who sometimes love them, sometimes hate them.  One buyer mentally calculated the cost of filling in the pool before deciding to NOT buy the house.  Another fell for the salt-water pool immediately and made an offer on the house.

Depending on your location, adding a swimming pool could be one of the worst investments a homeowner can make.  Massachusetts agent Bill Gassett says,

Swimming pools often times can actually end up being a detriment when selling a home. There are many buyers that flat out will not buy a home that has one no matter how beautiful it is.  Are there times where a buyer is specifically looking for a pool? Sure…if you are lucky you may find a buyer that will pay a little more for a home with a pool. Just don’t expect that it will be anywhere close to the money you have sunk into the ground.

If you have a pool, enjoy it now.  You may not so much when it comes time to sell!

Photo by my Mom. The kid on the right? The cute one? That’s me. 

I have shown numerous homes where the seller promises a carpet allowance at the closing.  When they do this, they acknowledge even before a buyer walks in the door that the flooring is bad and that’s not a good first impression to make!

When the carpet is frayed at the thresholds, if it has stains, if it’s worn out, if it’s an ugly color… go ahead and replace it if you can rather than promising an allowance.  Buyers fear the carpet allowance won’t be enough to replace the entire flooring (including costs of moving furniture, disposing of the old carpet pad and rug, the nail strips, etc.) so they are less likely to consider viewing the home much less making an offer!

There are carpet stores that offer six months same as cash for sellers who don’t have the money to pay up front.  There are builder-grade carpets that won’t cost as much as what the rest of us prefer, but they wouldn’t necessarily be the buyer’s choice of carpet.  And that’s the exact rationale so many sellers use, “The buyers should be able to pick their own carpet.”

While that’s true, you have to get them in the house to begin with and that’s very difficult if there are pet stains present, spilled koolaid from the kiddos, or - again - frayed edges.

Don’t wait.  Replace the flooring if you can BEFORE the home goes on the market.  It will be a huge help in reducing the number of days the home sits on the real estate market.

I’m beating the photo drum yet again.  Taking a look at a “quiz” on the National Association of Realtors web site and one of the questions was: What feature on real estate Web sites do customers most frequently say they find the most useful?

Of the choices, I picked “Photos of the property”…

Sure enough, the answer is correct.  So why in the world do sellers not request that their agents put multiple photos online when the home is listed?  I just performed a random search on my own MLS using the price range of $130,000 to $140,000 - an average priced home, really.  Of the almost 100 listings that came up, ELEVEN homes had only one photo or none at all.  That’s over 10 percent of the homes listed!

When you hire an agent to represent you, make sure they do their job.  Take photos, post them online.  It’s what buyers want.

Since we now live in a buyers market (for now, anyway!), sellers are grappling with how to make their mortgage payments on an unsold home if they’ve already moved.  One option we talked about yesterday was renting through a property management company.  Another option is to allow the sale of the real estate through a lease purchase agreement.

How does this work?  A buyer agrees to purchase the home through an official legal sales and purchase agreement.  The closing date is pushed out six months to a year, depending upon why the buyer can’t close right away (maybe they have to pay off a credit card or be on the job for two more months before a lender will approve the loan).  A lease agreement is also completed both to protect the seller and the buyer, including whether pets are allowed, and if the buyer can Paint or make other changes to the property before the purchase is finalized.

A very important way to protect the seller in this process is to make sure a substantial non-refundable deposit is made by the buyer.  Most people recommend the deposit be 10 percent of the purchase price, but honestly I think that’s a bit extreme.  I believe a deposit between $5000 and $7500 could be adequate if it’s nonrefundable. The money CAN be applied toward closing costs or the purchase price in the end.

No buyer will want to walk away from that kind of money by getting cold feet.  In addition, the deposit will protect the seller should the buyer walk and subsequently damage the house.  That amount could clean and/or replace carpet, cover the cost of painting, and replacing broken appliances.

The deposit money should be placed in an escrow account at the title company, especially if it’s to be applied toward closing costs.

In addition, if a seller is leasing they should be careful in contract stipulations that state what they have to repair or replace should the stove stop working, or other problems (flooding, fire, etc.).   Be sure that the homeowners insurance is maintained and up-to-date.

Another caveat is if the closing is a year out, perhaps the value of the home changes. If it goes up, the buyer gains instant equity because the seller will have to honor the purchase contract.  If the value goes down, though, and the real estate won’t appraise, what happens?  Will the seller be prepared to reduce the purchase price?

I have been involved in only three lease-purchase properties.  Two closed, one did not.  The one that did not was very unpleasant for everyone involved.

What experiences have you had with lease purchase contracts?

Photo from lease agreement form.info.