Saturday, January 30, 2010

You Might Not Need A REALTOR IF.... Reason #5

you understand the financing your buyer will need to purchase your property, and how to evaluate the financing your buyer proposes in the contract.

In today's market this is critical.  The lending environment is changing daily, and it is hard for even those of us who work in this day in and day out to keep abreast of the changes in programs, laws and the variances between the different types of lenders and brokers.

First of all, the basics... Do you know the difference of the varying loan programs available?  Do you know the difference between VHDA, VA, Rural Housing and FHA loans? 

Can you do seller financing, or partial seller financing? How is that structured and is it a good idea?

Which of these (and other) types of financing can be used to purchase your home?

  • Some loans are only available in certain geographic locations.

  • There are requirements for some loans about the physical condition of the property.

  • There are loans you can't get because you don't have the "right" kinds of utilities, appliances and mechanics in place in the home. 

  • There may be "anti flipping" policies in place, which require that you, the seller, have owned the property for a specified amount of time.

  • Some of the loans are "layered", which means more than one set of rules might apply to your transaction.  Which ones are layered and how do you know?
Are there any quirky or less common things about your home?  Believe it or not, there may be issues that can prevent certain lenders, or certain types of loans, from being used for the purchase of your home. A few examples of things I've seen come up:

  • Some lenders won't loan if the subject home has a well or septic system on another property, or there is a well or septic system which is located on the subject property that supports a home on another property.

  • If a garage (or other space) has been converted to a finished living area, there are rules about how that had to be done.  If they are not serviced by the HVAC system, it could be an issue.

  • "Harry Homeowner" work that wasn't done to code is a common problem with loans; EVEN if it looks nice.

  • Things as small as rotting trim or a warped backsplash behind the sink or a missing handrail can cause loan issues and prevent you from being able to sell as planned.

  • Missing kitchen appliances sometimes cause issues, depending on the type of loan.
And, then there are the "rules"... like:

  • If your house doesn't appraise, then what?  Can you get a new appraisal?  A new lender? A new buyer?  What if they are using the same kind of loan?  Some appraisals stick with the properties for as much as 6 months.  A low appraisal can taint your home and force you to sell low or wait 6 months or more, unless you know how to get it released or overturned.

  • Homes that don't have central heating systems don't qualify for certain loans.

  • There is a minimum processing time for loans now, thanks to new regulations.  Do you know the soonest closing date any lender can offer?

  • Can you do a rent-back after settlement?  For how long?

  • Each loan program has a different minimum down payment requirement, do you know the difference?

  • Are there no money down loans available anymore?

  • Which of these loans requires the seller to pay part of the closing cost, and how much?
Do you understand the financing and appraisal clauses of the contract?  What do they really mean?  In today's environment, don't assume everything will go as planned.  These lenders are tough. 

There are all of these things, and so much more, to consider.... and we've only discussed the requirements for the HOME and "deal", we haven't mentioned the requirements for the buyer yet!  And, yes, there are requirements for the buyer... it is no longer like the good old days where you could sign a statement telling them your income and they'd believe you.  Buyers are really put through the ringer to get a loan now.  Will they qualify?  How can you tell? 

Do you know the difference between a lender and a mortgage broker? between prequalification, pre-approval and approval?   Not knowing may cost you money - a lot of money.

What about rent to own offers - like rent with first right of refusal or a rental option, or a contract for deed or other variation of seller financing?  What are the differences? Where can you get the right advice? Do you know and understand the potential pitfalls?
Based on the contract you might get on your house, you will make decisions - to buy or rent another home, you'll even have to move before you actually sell the house (usually), this costs MONEY....something that no longer grows on trees here in the good ol' USofA.   

What protections do you have, as the seller, if the deal goes south?

While even the best real estate agent can not quarrantee you that any buyer will be loan-worthy, they can help you to minimize the risks of getting half way to closing only to find out your buyer can't get a loan.  A good agent can also try to HELP that buyer get a loan, or solve their lending problem, using the resources he or she has available - which should be a lot.

Maybe you work in the lending environment...that will help you tremendously with this aspect of your sale, so you might NOT need a REALTOR....unless you need any of their other services.

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Stay tuned to the REAL ESTATE WHISPERER for the rest of the posts in this series.



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703-669-3142



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Thursday, January 28, 2010

You Might Not Need A REALTOR IF.... Reason #4

Reason #4: You Might Not Need A REALTOR IF….
You Don't Need Assistance with Developing a Marketing Strategy and Implementing Showing Plan
 
In a buyers market, this becomes increasingly important.  In a sellers market, the marketing and showing plan is a lot less work.  You can make a lot of mistakes and still sell you house for a pretty penny.  So, make sure you understand the market conditions FIRST, then evaluate your expertise in the areas of developing a marketing strategy and implementing a showing plan.
 
Step one is identifying the target buyer so the marketing and showing plan are designed to reach that target buyer.  

  • How will your buyer use the property? Residential? Commercial? Development? Vacation Home? Primary Residence?

  • Where does your buyer work? Live? Drive?

  • What language does your buyer speak? 

  • What kind of financing will your buyer use?

  • Why will your buyer choose YOUR property?  Lake? View? Great roads? Inground Pool? Huge Bedrooms?  Home Office?  Next to the Metro?  Or, is it simply an affordable place to stay?
Once you have an idea of who your buyer will be, then you have some idea about where to advertise, and how to get serious buyers to see your advertisement.  You also know what your ad should say, how it should be said.

You're showing plan must complement the marketing plan.  Once you have the buyers' attention, how do you get them in the house?

  • Will they "drive by" first?

  • Will they come to an open house?

  • Will they come with their own REALTOR?

  • Will they schedule with you to see the house?

  • Will they have other access (open door, someone to meet them, key in a lockbox, what kind of lockbox), and will this be available on short notice?  i.e. if you are showing the home yourself, do you mind leaving an important meeting at work and driving home immediately to meet people, only to learn that aren't planning to move anytime in the next year? (These are called tire-kickers.) OR Better yet, people that say they are buying right away, but they haven't come up with a financing plan, and later you find out they don't qualify?
With this information, you know where the ads should be, if you need a sign, if an open house or brokers open is appropriate, what kind of access should be given to the property for potential buyers. 

After more than 100 years of working together, REALTORS all over the country have formed associations and studied these questions and worked together to devise solutions and provide resources and information to one another.  One of the most powerful developments of this association of professionals is the Multiple Listing Services they offer, and most REALTORS have membership to those local MLSs.  Buyers usually think of the MLS as "the" place to look for properties for sale, particularly residential properties. (There are similar, but less well known, search engines for commercial and other types of properties.)  So, most serious buyers are intentionally sorting through the MLS regularly, with the help of their agent or through public online portals to this database (i.e. REALTOR.com).  So, being in the MLS if your area has one is almost a must. 

But, what do you know about HOW to advertise in the MLS?  Priority considerations include:

  • Price (buyers search this database by price and location FIRST); what are the search options and how do you ensure your home is being seen by the most potential buyers?

  • Pictures vs. Virtual Tours - what do you need? how do you get them?

  • Remarks

  • Field Specific Data
Beyond that, online advertising, in most markets, is the most powerful media for advertising homes for sale.  But, which sites?  Do you know where the buyers are looking?

TOO IMPORTANT NOT TO MENTION: There are always security and safety concerns with every property sale that relate directly to the showing of the property.  I know you've watched the evening news and know that there are bad, evil people in the world.  Can you identify the risks involved in the home sales process and minimize them?

  • Will the home be too accessible so that vandals can access and damage the property?

  • Will grandma be meeting the buyers at the door?  Is she safe?  Afterall, what do you know about the buyers?  Do you know that real estate agents are attacked all the time?  Think about it... their job is to meet strangers, usually by themselves, often at an empty home.  Everything momma told you not to do.
  • Do you have "latchkey" kids?  Do you want strangers to know this? 

  • Do you know how to give your buyers space while they are looking at your home without allowing them opportunities to steal your percocet or the diamond cuff links you inherited from your grandfather?
Remember, people are coming into your home.  When they leave they will know about the valuables in your house, who lives in your home, where everyone sleeps, and when they are usually at home.  STRANGERS will know this.  DO YOU KNOW WHAT PRECAUTIONS YOU NEED TO TAKE to minimize the risks?

    REALTORS have ways to allow convenient, but controlled access to properties (this may not apply to land unless it is gated property).  They use electronic and other special lockboxes that minimize the risk of someone stealing or breaking into the lockbox to get a key to your home, but make the property available to hundreds of other agents (all of whom have met brokerage and licensing requirements including criminal background checks) who can show the property for them at a time that is convenient for the buyer.

    • Most REALTORS have screening procedures in place for potential buyers, so they are showing homes to ready, willing and able buyers..... not just willing, or worse yet "wishing" buyers.
    • Most REALTORS  have regular safety plans when they are showing homes to people they've not met before, which minimizes their risk and your liability as an owner of the property.
    So, if you read this, and are sure you've either (a) got this stuff covered; or (b) don't need any of this expertise, then YOU MIGHT NOT NEED A REALTOR, unless you need any of their other services.... so keep reading.

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    Stay tuned to the REAL ESTATE WHISPERER for the rest of the posts in this series.


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    703-669-3142
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    Monday, January 25, 2010

    You Might Not Need A REALTOR IF.... Reason #3

    Reason #3: You Might Not Need A REALTOR IF….
    You Don't Need Assistance with Developing a Pricing and Staging Strategy

    The number one problem I see with this is a lack of objectivity.  Most people don't really know that they need help here.  In fact, many people are in such denial that they won't even take the advice of their real estate agent when they do hire one.

    EVERYBODY thinks their property is the best.... yeah, that's why you bought it.  But you know it is not THE best, otherwise, you wouldn't be selling.  During the sales process, I recommend you focus on the reasons you DON'T want to live there, and not get offended when people suggest reasons they wouldn't want to live there.  I even find myself thinking "well, yeah, I know that house sold for X but my house backs up to..." And, then I realize what I am saying. 


    • Do you know how buyers look at homes? 


    • Do you know how to make your home appeal to the most likely buyer?


    • Who is your most likely buyer?

    Buyers are liars, so don't ask them.  I mean, it's not their fault, they believe what they say to you, but they don't know.... until they find what speaks to them.  Can you make your home speak to them?  And, when it speaks, is one of the things it says "value"?  If not, it won't sell.

    As a professional, in addition to having objectivity, we have information....lots of it.  We've developed resources and tools and professional relationships so we can obtain information quickly, accurately and efficiently with regard to comparables and activity levels.  We may have seen some of the comps, know their condition and the less obvious reasons for why they are, or are not, selling.  If not, we can usually get the inside scoop pretty quickly.

    • I recall one comp and I swear the reason it wasn't selling was the python in the cage when you walked into the living room.  I don't think it ever sold.  
    • In another, I know the property wasn't selling largely because of the bird on the breakfast bar.  I re-listed it, staged it right, and sold it in a month.
    • In still another situation, I am aware that one comp that was tainted by a low FHA appraisal for 6 months, eliminating 80% of his target buyers.  Too bad his agent didn't know how to get that released.
    First you have to know these things... then you have to know how they will affect the price for your home.

    Good agents have knowledge about the market, who your buyers are, how buyers are buying and what they are considering.  And, a good agent can sell to that segment.....with property staging and pricing.

    With your help, we (as agents) will recognize what is great about your property.  Then, with our help, you can show it off.  Sellers are shocked (and offended, I think), when I suggest:


    • They should hide te coffee maker and display a cook book; to put away that great family photo and the bagua.  
    • Your home is probably full of things you love.  Your lovely things are not for sale, put them away - get a storage  unit if you have to.  Oh, wait, minimalists - don't get too cocky, empty is not good either.  
    • You may have a great furniture arrangement for watching TV, your buyers will not be watching TV while looking at your home, but I can't see your fireplace from the front door, so we're moving your couch. 
    • Your curtains are beautiful - take them down.  
    • It is nice to have the windows open in the spring - but don't, and get rid of the screens.  And, oh, by the way, when is the last time these windows were washed?  
    • Functionally, I would like the trash can there, too.... but it's got to go. 
    • Sorry, Charlie... if you want the magazines in the John, they gotta be hidden.
    • I don't care if your home was professionally decorated - in fact, maybe ESPECIALLY if your home was professionally decorated, you will need staging advice.
    You don't want to hear any of this....I don't want to say it.  But, it's for your own good, and you should pay people to say it to you.  If you listen, you will MAKE MONEY.  Sometimes BIG MONEY.

    And, this part of the consulting goes far beyond just moving furniture.  Should you paint? Replace carpet? Replace the roof? What's going to return you the biggest bang for the buck?  Is it important to have the driveway sealed, the garden mulched?  Is it better for the home to be occupied or vacant? Should we leave furniture, or empty the house?  My answers to these questions depend on literally thousands of factors, and so they are different for every home and every household.

    At the end of the day, if you are POSITIVE you don't need the staging advice (do not ask your friends here, they will either lie or not know any better when they tell you what you want to hear), or pricing advice (the worst person to ask here is someone in the neighborhood), OR you won't listen anyway, then skip it - don't bother hiring a real estate agent.....Well, unless you need their other services.


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    Stay tuned to the REAL ESTATE WHISPERER for the rest of the posts in this series. 

    In the meantime, if you need honest feedback about whether you should hire a REALTOR to sell your home, and if you're in the Loudoun/Dulles area, feel free to call me.  I am happy to talk with you over the phone about some of the pros/cons of hiring a real estate agent.
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    703-669-3142

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    Sunday, January 24, 2010

    You Might Not Need A REALTOR IF.... Reason #2

    Reason #2: You Might Not Need A REALTOR IF….
    You Don't Mind Leaving A Little Money On The Table

    It may seem that I am being facetious when I say "...IF you don't mind leaving a little money on the table", but I am not.  While most sellers are looking to get the highest and best price possible, some aren't, or it is not their priority.

    They may be looking to turn a profit, and if they are happy with that profit, and the transaction doesn't present risks, then taking the quick offer may be the right move.  For example, a current client of mine is a land investor.  He bought a lot for $5,000 and quickly resold it (FSBO) to my dad for $10,000.  He was very happy.   My dad did nothing to improve the lot and sold it, through me, a few months later for a $45,700.  The original investor, even knowing what my dad got for the property, was not unhappy - he still make $5,000 very quickly, and at that time, he needed the cash very quickly to roll it into another investment which ended up returning him a much greater profit.

    The owner could be looking to dispose of an estate quickly and expeditiously, for any number of reasons.

    Or, perhaps the seller doesn't get to keep more than "X" of the profits anyway, so if the offer on the table provides that, then that is all he needs.  I have seen this in divorces.  One spouse is being forced to sell, and he/she only gets a flat amount from the sale, and in order to limit the profit of the other owner, refuses to list it with a REALTOR. 

    I am not being silly, ALL of these situations apply to some people, even though they do not apply to most of the people most of the time.  If one of these scenarios (or something similar) describes you, and you've got an offer that meets your needs, or you can get an offer that meets your needs (without the assistance of a real estate agent) then take it. 

    Why pay a real estate agent to offer full service when they won't have to do any pricing or staging strategies, any marketing plans or showing, or any serious negotiations?  Again, in this circumstance, just like in the prior one, FSBO (For Sale By Owner) may be the way to go. 

    You will still need some help - (see description of legal or limited service real estate  assistance needed in REASON #1), but that should be far less expensive than hiring a full service agent.

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    Make sure you don't miss any of these posts... so stay tuned to THE REAL ESTATE WHISPERER for the rest of the posts in this series.

    In the mean time, if you are looking for a honest feedback about whether or not you should hire a real estate agent, feel free to contact me. I work in the Dulles and Loudoun areas, and I am happy to spend a few minutes with you on the phone to help you recognize the facts so you can make a good decision.
     
    Vicky Chrisner
    Ofc: 703-669-3142
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    You Might Not Need A REALTOR IF.... Reason #1


    Reason #1: You Might Not Need A REALTOR IF….You’re sellin’ to Aunt Bessie.


    If you are selling to a relative, neighbor, friend or even a company that you own, and all major terms have been agreed to, then you may not need a real estate agent, or at least not a full service agent.

    There’s no need for marketing and pricing strategy and efforts, or initial negotiation assistance, because in this example, you are not looking to sell for the highest and best price, and you're not worried about protecting your "position" because you trust the person with whom you're doing business, and you simply don't have much at risk anyway. If the sale doesn't go through, you won't be in a bad position.  (Please do make sure all of these things are true in this example, otherwise, it does not apply to you.)

    Even so, you still need someone to advise you on the legal requirements for contracts, disclosures and to assist and coordinate contract to close efforts. Depending on the transaction, an attorney may be best or a limited service real estate agent.

    If the transaction is technically or legally challenging and is a little more out of the “norm” for the market – like a seller financed deal, or a rent-to-own deal or large land transaction, then an attorney is probably best. They will charge you more but are in a better position to assist you with the legal aspects, and they can likely handle the closing, too.

    If the transaction is more traditional in nature – residential property, bank financing with appraisal contingencies, then a hiring a real estate agent would be a better choice. Agents are better trained to deal with this and have resources readily available to deal with financing and appraisal issues that may arise, and a title or settlement company can handle the title and closing process. This combination will also usually cost you less than hiring an attorney.

    As a special note, I’ve not seen most limited service agents really know how to deal with “problems” in this area should they arise. They usually work by the hour and really don’t care if the situation gets worked out. They are used to the "other side" having a full service agent and doing the work for both sides. So, I’d try to hire an agent that typically handles full service transactions and ask them to act on a limited service basis. While their fee may be contingent, or a flat fee or hourly, they are used to operating as if their own livelihood is on the line, too, so they’ve developed strategies to deal with “problems”, and have a higher level of expertise and more resources available to them. Doing this is not possible in all states or at all brokerages, so you’d have to ask around.

    * * * * *


    Make sure you don't miss any... so stay tuned to THE REAL ESTATE WHISPERER for the rest of the posts in this series.


    Ofc: 703-669-3142

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    Top 10 Reasons NOT to Hire A Real Estate Agent To Sell Your Property

    Most agents will offer you a list of the top 10 reasons TO hire a real estate agent, and ideally, hire them.

    However, I am not like "most" real estate agents.  I think there are legitimate times you shouldn't hire a real estate agent, and I am working on putting together a list of the top 10.....

    You Might Not Need A REALTOR IF....









    **In TODAY"S MARKET, there is a HIGH likelihood that your REALTOR could earn
    150% of her commission with just this one!***




    Each of these situations apply to some people some of the time.  For the majority of the people, the combined benefits of convenience, expertise and resources offered by the right real estate agent will far outweigh the cost of brokerage fees, and in most cases these benefits translate into more dollars in a sellers pocket, even AFTER paying the brokerage fees.

    Are you in the Dulles/Loudoun area and thinking of selling?  Give me a call and let me show you the value I will bring to the sale of your home.

    Ofc: 703-669-3142

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    Tuesday, January 19, 2010

    You Spent HOW MUCH to remodel the kitchen? - The Value of Home Improvements, Part 3



    Each year, the National Association of REALTORs publishes a report as a guide for homeowners who are wondering how the value of their home will change based on home improvement projects. 

    The report publishes numbers by region and by national averages.  But, the regions are large - for example, the South Atlantic includes DC, DE, FL, GA, MD, SC, VA, and WV; and real estate is local, sometimes hyper local.  So, I encourage you to contact a REALTOR in your area for more specific advice before starting your upgrades. 

    However, as a point of interest, the NAR report will tell you in general which improvements will have what returns.  In this post, I reference the recouped costs as reflected for the South Atlantic area., but they are not too different from the national averages - just a little higher in most cases.

    The NAR report shows the costs of the improvements and the increase in the sales price of the home after the improvements as a percentage.  For example, the highest return value was for a midrange replacement of an entry door.  The job cost is listed at $1065, and the home value increase at $1562, therefore, the job is expected to return almost 147% of the invested dollars.  (Please note, it is the ONLY improvement listed that was expected to return more than 100% of the invested funds.)

    Improvements that rated best (meaning 75% or more of the job cost could be recouped), included:
    *  Adding an attic bedroom, or a wood sundeck
    *  Remodeling a basement or doing a minor kitchen facelift
    *  Replacing entry doors, vinyl siding, and new windows

    Improvements that had expected returns of less than 65% included:
    * Adding a back up generator, a bathroom, sunroom, garage or master suite.* Remodeling a home office, or doing upscale remodels of bathrooms or major upscale kitchen remodels.

    A few other points of interest for our area:
    *  All of the listed improvements and replacements returned at least 50% of the costs to do the job.
    *  Midrange materials faired better than high end materials.
    *  Replacements of doors, windows, roofs, and siding all returned 65%-75% of the costs, but I want to remind you here that this is really "maintenance" in some cases, and it's an "upgrade" in others... it all depends on what the Jones's are doing next door - in other words, how your home compares with it's comps.

    Underlying themes:
    After reviewing the report in its entirety, it reinforces certain themes I share with my customers, clients and friends all the time....
    * First impressions count.
    * In resales, people are not usually expecting the latest, greatest in finishes - they are looking for "good", "well kept", "loved", "well maintained" property - spending the luxury dollars on improvements is not usually going to provide you with same return as choosing solid, classic finishes... and it usually costs you less, too.
    *  Being the nicest house on the block is only good for showing off to your neighbors.  As far as financial investments are concerned, you're always best off having the smallest, least upgraded house in the most expensive neighborhood rather than the largest, most upgraded house in a lesser expensive neighborhood.

    If you missed my prior posts in this series, consider visiting them (just click on the links below):
    *  Understand the difference between maintenance and upgrades.
    *  Learn WHY the only improvement that returns more than 100% of its cost is replacing the front door.

    Again, I remind you, real estate is local, HYPER local in some cases, so if you're in the Loudoun/Dulles Area, please contact me to provide you with information on what's going on in YOUR neighborhood - or order your own automated report (with sales information on YOUR neighborhood) by clicking HERE.
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    Saturday, January 16, 2010

    First Impressions Pay Dividends - The Value of Home Improvements Pt 2

    In the annual survey, NAR (National Association of REALTORS) attempted to provide a gauge for what return sellers might expect to recoup after doing home improvements.  In other words, if you spend $100 for the improvement, will it increase the value of your home $100, or more, or less - THAT is the question.


    Wondering what the one exception is?  (Drumroll, please....) Replacement of a front door!

    This reinforces another piece of advice I give to clients – first impressions count, and in this case, it seems they pay dividends. 

    In fact, I tell seller clients that 30% of the buying decision is made prior to arriving at the property, as they’ve usually seen pictures, have a clue about the area and know the price before they’ve considered looking at your property – they are 30% sold. Then, they make an appointment or maybe just do a “drive by” – this accounts for another 20%. Here, they are taking into consideration more intimate geographical decisions – your neighbors, the street, the outside of the home – all together referred to as curb appeal. A front door replacement has some affect in this calculation, too…. Although they haven’t touched anything or gotten an up close look, so it is still minimal.

    Here it comes, they get out of their car. They imagine coming home to this place… do they like what they see? They stand for awhile at the front, waiting on someone to open the door. How much trouble do they have getting inside? Does the lock fall off the door? Does it unlock? Does the door look good? There is a lot of time spent here, and thus, the front door replacement would have an impact.  I also urge sellers to consider other details a buyer might notice if they were standing at the front door - cob webs, windows/screens, porch furniture and condition, cleanliness of siding, any adornment on the door or near the door - like flowers, wreaths, flags.... these all impact what the buyer thinks about who lives in the home, and how they care for it.  Worn door mats will cost you money on your sale - replace it or get rid of it all together.

    From the front entry, another 25% of the buying decision is made. That means, if they enter you home with a positive impression they are 75% sold. What can they see from the front entry? In staging and marketing, there is a great deal of time spent on how to make this critical impression.

    Once inside they place their furniture, figure out where they will sleep, entertain, if their furniture will fit… and all this together only accounts for 25% of the buying decision, but they must be 98% sold before they will put together an offer. As a seller, understanding this process is critical. Usually the first and last 20% a seller can not affect-they can not change the location of their property, they can not change the configuration of the home. They can price right and stage right – and that is the difference between sold and for sale, and where listening to a qualified sales consultant comes into play.

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    Friday, January 15, 2010

    Getting Bang for Your Buck - The Value of Home Improvements



    With this post, I begin a little mini series on how to spend your home improvement dollars wisely.  While buyers may enjoy these posts, they are targeted toward current home owners who eventually - tomorrow, next year or in 5 years, expect to sell. 

    The number one thing I want to tell you is this:  If you're thinking of selling in the next year, DO NOT do home improvements - it will return you less than 100% of your dollars.  It's a poor investment. 

    That does not mean not to do maintenance.  Sellers, when they are looking for dollars in their house, get confused as to what is improvement and what is maintenance.  Here's a rule of thumb - if the house should have those things, then it's not an improvement.

    Replaced your roof last year?  Good for you, and good for your buyers, too.  But, SURPRISE! the buyers expected your home to have a roof - one that doesn't leak and isn't requiring immediate replacement.  New mechanics - like HVAC or water heater?  Nope, not an improvement.  Your buyer was looking for a house with heat and hot water - it was "assumed" that those things would come with the house. 

    Please don't get me wrong - these things have value.  Look at your comps, is everything original, or do they all have replaced systems, too?  That's how you determine if yours might bring you extra dollars.  If you are just keeping up with the Jones's then your home value will be approximately the same as the Jones' home.

    Of course, if you replaced 20 year asphault shingles with 40 year architectural shingles... well, that is an improvement.  If you now have a tankless water heater that saves hundreds a year in utility bills and never requires a waiting period to get more hot water, this, too would be an improvement.  If your HVAC was one zone (as are all of those in your competitor's homes) and your's is now a 2-3 zone, energy star certified system with an electronic air filter and built in humidifier - NOW we're talking improvement.  Did you replace your vinyl siding with Hardi plank last year and add stone accents.... cha-ching!  (You're still likely to recoup less than you actually spent, but you will see some added home price value.)

    Many of these things may be invisible when someone is breezing through your home taking a quick look, so make sure that you are listing both major maintenance and home improvements when you're agent is preparing the marketing materials. And, remember, good bones and systems will not always equal the highest price. 

    Buyers buy emotionally and justify logically.  Never once have I been showing a home and had a buyer just become awe-struck by a water heater and stare.  This is NOT where they fall in love with your home.

    I am going to continue this series, in which I will discuss home improvements and the expected return for your investment based on a recent study by the National Association of REALTORS. 

    I will also address how buyers will assess your home.  You may be surprised.  So, stay tuned for more..... http://www.therealestatewhisperer.blogspot.com/



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