The Real Estate Whisperer

703-669-3142

This is REASON #8 of the TOP TEN REASONS NOT TO HIRE A REAL ESTATE AGENT TO SELL YOUR HOME. (Click this link to see all posts in this series.)

Friday, February 12, 2010

You Might Not Need A REALTOR IF....Reason #8

You Might Not Need A REALTOR IF.... Reason #8

You Know How To Deal With Low Appraisals

Don't let you're money go down the drain!

Although I briefly mentioned this in prior posts, it is critically important and therefore I am focusing on it as it's OWN separate issue. Appraisals. Ugh.

Appraisals are a key ingredient in most sales. While there will be some cash sales out there, even some of those sellers will want an appraisal, especially in a market like this one. No one wants to overpay for real estate today. But, the vast majority of buyers will be getting a loan and financing their purchase of your property. Their banks will REQUIRE an appraisal.

Some segments of the market are appreciating, while others are still on the decline, and still others have no activity at all. This makes it very hard to get a good appraisal. But, let me ask you this, Mr. Seller...."Honestly, would you know a good appraisal from a bad one? How?"

If your answer is you'd know because the appraised price was lower than your sales contract, well, you could soon find yourself in a pickle. No bank, no appraiser, can make a change based on that.

Maybe you think you'll rely on zillow, or tax assessments? Nope. Irrelevant. Sorry.

You'll tell them that your neighbor sold his house last year for $25K more. Nope again.

You will need to SHOW market knowledge to an "expert" in such a manner that it doesn't show bias. Good luck with that if you are the seller. I couldn't be unbiased if it were my property. I wouldn't be completely unbiased if I were your listing agent, but I could handle the matter in a way that seemed unbiased. I have resources to use to support the price, and market knowledge (as well as the collective knowledge of the agents around me).

And, what if the appraiser refuses to make a change? Can you get a new appraisal? Probably not, especially if you're on your own.

What if you cancel the contract all together and go with another buyer? Well, depending on the type of appraisal, it may be SIX MONTHS before you can get a new appraisal if the new buyer is using the same type of financing - EVEN if it is with another bank. Did you know that? Most people don't, but I promise it's true.

You see, there are "rules" and then "exceptions" to the rules. A true expert in their field can help you navigate your way through tricky situations like low appraisals. While ultimately, you may be forced to accept the low appraisal and even lower your sales price or provide another concession because of it; that should NOT be your only defense.

A strong listing agent will have many potential alternatives for dealing with appraisal issues. Market knowledge and resources are the first line of defense and with a strong argument, and with the right presentation, this is often all you need. Other times, it is a matter of getting to someone who will listen - and having those inside connections at the bank can help. But, even the best agent can't know the VP of every bank in the nation. So, then what?

The RIGHT agent will be able to answer this question as it pertains to YOUR property and YOUR most likely buyer.

If you are in the mortgage industry or are an appraiser, you may (or may not, depending on your experience level) know how to deal with low appraisals so that the vast majority of the time the purchase can move forward as planned, with no further concession by the seller. Otherwise, you might just need to hire a real estate agent to help you with the sale of your house.

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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

This is REASON #7 of the TOP TEN REASONS NOT TO HIRE A REAL ESTATE AGENT TO SELL YOUR HOME. (Click this link to see all posts in this series.)

Friday, February 5, 2010

You Might Not Need A REALTOR IF.... Reason #7

You Might Not Need A REALTOR IF....Reason #7

you love stress, and can handle managing the 'contract to close' process.

Tick * Tock * Tick * Tock

Managing the contract to close part of the transaction is one of the more mundane parts of the process, thus the reason that real estate agents on both sides of the transaction delegate much of this tedious work to trained assistants and transaction coordinators. In a perfect transaction, it is a matter of going through a checklist prepared based on the contract provisions and ensuring that you 'check the boxes' as quickly as possible, and without missing any deadlines.

Sadly, there are very few perfect transactions; and there are critical components of this process that MUST be managed or the transaction may not be successful. The more complicated the contract, the more complicated the process. The more emotional the parties, the more difficult each step is and the longer it takes... meanwhile, 'tick, tock, tick, tock'.

There are usually multiple deadlines put into a contract. Many of them are quick, and some are confusing. Many deadlines read: 'X days after the date that notice is sent'.

The standard language in many contracts states if something is not delivered properly to the other party, or not completed within a particular time frame, the transaction is void. Understanding the contract is crucial, managing the contract is even more important. You've worked hard to get to this point. What if it falls apart now?

If you have one, the listing agent (in combination with the buyers agent and/or their assistants) will manage and coordinate this process. Assistants are trained to alert the listing agent anytime a 'caution' flag is flown so the agent can intercede and get things back on track before they become a problem.

Below are examples of common components that must be managed:

Immediately following the ratification, the lender begins (or hopefully, continues) the verification process for the loan. Buyers will be asked for an endless supply of documents.
Title work is ordered.
Inspections are completed as required. This may include general home inspections, pest and environmental inspections, and inspections by contractors, lenders, arborists, surveyors, soils consultants, etc. Following any and all of these inspections, more negotiations may be required, and these negotiations can be highly emotional, as they are completed when the buyers' euphoria is gone and buyers' remorse has set in. Meanwhile, sellers have emotionally moved on and started counting their proceeds thinking they are "done". It seems the smaller the issue, the harder the negotiations. I recently had a $500K+ transaction fall apart over a dispute about the cost of a repair - the disagreement was essentially over $1400. Again, refer to the tips on negotiating your real estate contract, which were written in a prior post (CLICK HERE).
If applicable, the property owner association documents are ordered. Ensuring proper delivery, understanding the required components of the resale packet, and the review period, are critical. Discovering that something about the home is out of compliance with POA requirements - existing architectural guidelines and maintenance requirements (a fence that needs to be moved or rebuilt); or learning about unusual requirements (i.e. neighbors' first right of refusal to purchase the property); or being advised of outstanding monies due are just a few of the potential issues. In Virginia, during the review period, the buyers can literally walk away from the transaction even if there are NO PROBLEMS, so it is a critical component of the transaction.
The appraisal is conducted. If it goes well, the owners and agents may have very little involvement other than providing access and answering the appraiser's questions. However, if the appraisal comes in low, you will really need an agent to assist you with providing information and in the appropriate ways to handle challenging the appraisal. If this is a government loan (i.e. FHA) a low appraisal could affect the price you're able to get for the property even if you find new buyers. Some segments of our marketplace are appreciating again, and so appraisal issues are increasingly common, especially when there are many comps that are distress sales.
Title work is reviewed by the lender and title insurance company and hopefully approved. Issues that come up include any number of things - unreleased or improperly recorded liens, deaths in the chain of title, earlier title defects, unrecorded quit claim deeds, judgements in the names of the buyers or sellers (even if it was someone with the same or similar name, but not the parties to the transaction), survey issues, easements, even trouble getting payoffs from lenders when mortgages have been sold. Admittedly, the vast majority of these issues can be resolved by a good title agent, but the listing agent may play a hugely supportive role in resolving some of these issues - perhaps just in keeping all parties calm and negotiating a delay in settlement to allow resolution; but perhaps in tracking down information that satisfies the concerns of the title agent or lender.
Once you've gotten through ALL of this stuff, and the loan has been approved, then the agent attempts to ensure that the closing company receives the loan package in a timely manner, reviews the preliminary HUDs (settlement statements), and compares the statements to the seller's expectations and ensures that everything is accurate.
The listing agent also coaches the seller on things like utility and insurance transfers, and ensures a final walk through is done by the buyers at closing, and a form to that affect is signed.

With so much going on in so little time, it can get crazy. In fact, it is not unusual for there STILL be negotiations going on between the parties at the settlement table or even afterwards.

If you are a seller and have decided to do this on your own, I wish you well. If it goes well, you'll think "see, that was a breeze" and if not, well, good luck.

I know that many sellers hire limited service agents to assist with certain aspects - marketing, and perhaps some negotiating, but coordinating the sale falls to the owner.... and since most of the time the owner is unfamiliar, often the buyers agent will take control of the process. While this is a nice courtesy and the owner probably feels that they are getting the best end of the deal - receiving services not paid for - they are sadly mistaken. A buyers agent will be processing the sale, with everything being tilted to the advantage of his or her clients... NOT to the interest of the sellers. Again, depending on the transaction and the parties, this may or may not result in a negative outcome for the sellers...but they really should be aware that the buyers agent's job is to "represent the buyer", at all times.

So, my advice to sellers managing the 'contract to close' part of the transaction by themselves: Pray that your buyers want to be fair with you, and keep the valium handy - just in case!

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Special Note About Agency:

Whenever I hear a customer (note: not a client, there is a big difference) talking about an agent who was 'dishonest' or 'unfair' the vast majority of the time the issue is the customer chose to be unrepresented - perhaps for convenience, perhaps because they didn't want to incur the costs - but the result is a party who is not represented. The outcome can be that the unrepresented party felt 'jilted' by the lack of service or getting caught off guard with an unexpected obstacle, which may cost them.

Please understand, we have a job to do, we are supposed to represent the party that hires us. This is why we have you sign a document that says you understand that we represent the other party. We won't tell you in what ways we will provide an advantage, anymore than you would tell any opponent your strategy. That's the deal. If it makes you uncomfortable, hire your own agent.

Otherwise, proceed with caution. Many of us are very good at our job, which is to maintain an advantage for our client, without alerting you. We are NOT being deceitful.

I do not provide this full and blatent disclosure to scare you, just to make things perfectly clear. There is a lot of misconception here. I have been in many transactions where a party was unrepresented. I always do my best to be fair, honest, and forthcoming. I advise my clients that is the best way to negotiate a transaction. However, if doing so provides them with a disadvantage, and if there is no law that requires disclosure, then client confidentiality requirements overrule my desire to be forthcoming with the customer. Again, just understand this is my job. Sometimes, agents don't like our jobs. But, we do them just the same.

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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

This is REASON #6 of the TOP TEN REASONS NOT TO HIRE A REAL ESTATE AGENT TO SELL YOUR HOME. (Click this link to see all posts in this series.)

Tuesday, February 2, 2010

You Might Not Need A REALTOR IF.... Reason #6

You Might Not Need A REALTOR IF....

You know how to, and LIKE, negotiating.

I see people that have this WRONG more than they have this right. There are some core things to keep in mind when negotiating an offer.

• As a seller, you love your home. In this market, you are feeling pain and loss because the value is not as high as the perceived value a few years ago. Get over it. Your buyer is still likely spending more money than he EVER thought he would. It’s likely YOU never even spent this much money on anything, even the very house you’re selling.

• When you get an offer, if it is for $1 and has every contingency on the planet, and comes with a cover letter that insults you to your very core, don’t get insulted. I am not suggesting that you should take the offer, just that you should not get insulted and react emotionally. Let’s consider some potential reasons the buyer has presented the offer like this:

o He loves your home most of all, more than any other home in the world, and yet, it’s the best he can do.

o He loves your home most of all, hired the wrong person or got the wrong advice or whatever, and he thinks this is how you’re supposed to negotiate.

o He figures, “what’s the worst that can happen?”. I once had a buyer who did a home inspection and asked that everything on the inspection be taken care of by the seller. I don’t usually suggest this in a resale (it depends), but when I said to the buyer “you want to ask her to take care of ALL of this?”, he responded, “why not?”. In his case, we were successful, but it created undue stress on the sale. By adopting a “why not?” attitude, you could kill your sale – no matter what side of the transaction you’re on, so proceed with caution.

• Don’t play hardball. You’ll lose and then what? You may not be able to back up and accept what was previously on the table. Even if your contract position allows you to, trust me when I say that if you put unnecessary stress on a contract situation, it starts to wear on the other party. And, with each new stress, you’re adding more emotional, and perhaps financial or other types of pressure, and everyone has a breaking point. When you reach that, it is a point of no return and anyone who wants to get out of a contract bad enough will.

• Negotiating something to a successful outcome is actually the result of parties willing to work together. Remember the Golden Rule now more than ever: “Do unto others as you’d have them do unto you.” This applies EVEN when you are negotiating from what you feel is a position of strength.

• Maintain focus on what you have in common. OFFER flexibility where you have it. TALK through responses to the contract before you put them in writing… and talk nicely. Explain feelings but stay objective.

o “I appreciate your offer, but we simply can’t fathom accepting a price that’s $50K below our asking price. Am I right to assume this is just a ‘starting point’ for you in the negotiations?” , or

o “We’re likely going to counter on the closing date. Can you tell me why the buyer chose this date?” or,

o “We’d be fine with allowing a home inspection, but if we’re accepting this price, we don’t plan on making repairs, even if something is found. We’re willing to allow your buyer the option to ‘take it or leave it’ after the inspection, but we’ll want the right to continue marketing and accept back up offers until the home inspection contingency is removed, and we need that to be within 5 business days. Does that sound acceptable?”

You might be surprised at some of the answers you get.

Once you are comfortable with the general principles of successful negotiating, then it’s time to move on to the core issues.

What CAN you legally negotiate?
What clauses are you required to keep in the contract?
Do you truly understand the contract, each part separately and then cumulatively?

In Virginia, limited service brokers are supposed to give sellers certain disclosure forms and explain some of this to them. However, I am on the buy side of a deal right now where the sellers used a limited service broker (just to list in the MLS), and they had never seen those forms, and had no clue about the Lead Based Paint or other seller disclosure forms that were required. They didn’t know anything about the Property Owner Association laws, required disclosures, or costs associated… and they certainly wouldn’t know that you can’t, even by contract, waive these rights.

While in this case, I feel certain that the seller’s will get through this transaction fine, that my buyers WILL buy and all will be wonderful, that’s NOT guaranteed. I can tell you that if my buyers change their minds, I can get them out of this transaction without much effort. On the flip side, the sellers can not get out of this contract unless my buyers agree to let them. Because of my client's representation, and the lack of representation of the sellers, the buyers have the full contractual advantage.

If as sellers, you had thought you’d negotiated an air tight contract, and made decisions (like quitting jobs to retire, settling on a new home and moving half way across the country), and then ended up still having this house on your hands… well, that could financially devastate many people, and put a financial strain on most.

So what if the contract IS air tight? What if the buyer simply doesn’t do what he promises? Do you have any rights or recourse?

These are things you need to know.

If you are a real estate attorney, or have other relevant experience, and are comfortable with this kind of detail, then you might not need a REALTOR. I have found, however, most attorneys KNOW that they don’t know this stuff as well as a seasoned agent, and when coupled the other services offered by an agent on either side of the deal (buy or sell) they want an agent to assist them. I have several attorneys that are or have been clients, and they like when their agent can speak to the legal technicalities with ease, and in a manner they can relate to… while still giving good practical advice and explaining things to other family members in a more common language… so everyone understands the risks, the benefits, and the “what ifs”.

You can hire an attorney or an agent to represent you with negotiations, but keep in mind that attorneys and agents work best as a team if something is sticky. One has practical “industry standard” knowledge about how things are “normally” done and what “usually” happens, and how to AVOID the courtroom. The other often primarily has experience AFTER things have fallen apart, they don’t know how it could or should have been avoided… they just know what to do NOW, and it often involves a lawsuit. Do you LIKE being in a courtroom? Do you want to have things pending for months so it can wind its way through the system? You need to know your comfort level here before you decide. And, write it down, so you don’t forget later what you were thinking.

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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

This is REASON #5 of the TOP TEN REASONS NOT TO HIRE A REAL ESTATE AGENT TO SELL YOUR HOME. (Click this link to see all posts in this series.)

Saturday, January 30, 2010

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

You Might Not Need A REALTOR IF.....

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

This is REASON #4 of the TOP TEN REASONS NOT TO HIRE A REAL ESTATE AGENT TO SELL YOUR HOME.

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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Vicky Chrisner, REALTOR

Keller Williams Realty * Leesburg, VA

703-669-3142

VChrisner@KW.com

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.

* * * * *

This is REASON #3 of the TOP TEN REASONS NOT TO HIRE A REAL ESTATE AGENT TO SELL YOUR HOME.

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

* * * * *

Vicky Chrisner, REALTOR

Keller Williams Realty * Leesburg, VA

703-669-3142

VChrisner@KW.com

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.

* * * * *

This is reason #2 of a list of the TOP TEN REASONS NOT TO HIRE A REAL ESTATE AGENT TO SELL YOUR PROPERTY.

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

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 decide.

Ofc: 703-669-3142

Email: VChrisner@KW.com

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.

* * * * *

This is reason #1 of a list of the TOP TEN REASONS NOT TO HIRE A REAL ESTATE AGENT TO SELL YOUR PROPERTY.

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

Vicky Chrisner

Reason #1: You're Sellin' To Aunt Bessie

Ofc: 703-669-3142

Email: VChrisner@KW.com

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....

Reason #2: You Don't Mind Leaving A Little Money On The Table

Reason #3: You Already Have a Pricing and Staging Strategy

Reason #4: You Have A Marketing Strategy and Showing Plan

Reason #5: You Understand the Financing Your Buyer Will Need

Reason #6: You Like Negotiating

Reason #7: You Can Handle Managing the 'Contract to Close' Process

Reason #8: You Know How To Deal With Low Appraisals

**In TODAY"S MARKET, there is a HIGH likelihood that your REALTOR could earn

150% of her commission with just this one!***

Reason #9: You Ain't Afraid of No Judge

Reason #10: You Don't Really Plan To Sell

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.

Vicky Chrisner * REALTOR