What is our house worth?

It is time to tell you that there is one essential ingredient when it comes to marketing a house.

Back when they first sent me to real estate agent boot camp in the days of telephone cold-calling, the sales gurus  talked about condition, location, motivation and pricing before we were shown the Criss-Cross directory and told to make 50 calls.

Every “No” is a step closer to a “Yes”, Floyd barked at us.

The telephone bit wasn’t my style, but, I learned some golden nuggets during that old-school training. Understanding how to market a house is essential today especially with super informed home buyers who often have more data than their agent. You know what I am talking about because you have probably looked at the “comps” before looking at any home.

The interesting x-factor is that every home is unique (even in a Toll Brothers Community) determined by the particular lot and refined by the individual home owner.

Some home owners suck at maintaining a home — and some are amazing.

The problem is that home buyers who are looking at the “comps” miss that subtle differentiation because they are so focused on the numbers. And here is a new problem: so are many of the agents. Looking at the comps, some agents are recommending to their clients to price just below the market to capture home buyers who are looking for a deal… assuming that they will bid-up the deal-of-the-week.

Last week I saw this strategy backfire on an agent in a community where I was marketing a home. I had changed the status to “Under Contract”, and about two hours later she left me a panicky voice mail about her new listing and her possible need to “modify her pricing”… (up).

Leaving cash on the table

To undercut my clients, she recommended her clients price their home $25,000 less than my client’s. In her defense based on the comps, it looked like a reasonable price. But the strategy was flawed because the current market was much more active than the previous few months. National real estate sites like Zillow can give you give you good insight into past activity, but they aren’t good at showing you what’s been going on in your market over the last two weeks.

When I told her that she was priced too low, she responded that they hoped to get it “bid up by eager buyers”. The reality was that she didn’t expect me to help my clients be successful.

So, do today’s buyers like to be “gamed” like that?

Over the years I have seen this strategy actually work in all price ranges. Getting a buyer’s interest is essential, but if you are a home seller with a superior home in an active real estate market then you have to at least try to get the market value of your home.

If you don’t want your money, then donate it to Habitat for Humanity

The essential ingredient when deciding how to market a house is determining the right price for today’s market. Too high and the buyers walk, and if it’s too low then the seller leaves money on the table.

Yes, homes still need to get appraised. Yes, some agents will over-price listing.

But, all home sellers should know that establishing a realistic asking price is the essential element in how to market a house. After that, the market will determine the real value.

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Use simple bullet points

Recently, when a client was interested in putting together an offer on a particular house we had seen, he asked me if I had picked up a brochure.

“No I didn’t. Did you?”

Since neither of us had one I decided to contact the listing agent to ask her to email one over to me so I could note any updates or recent improvements to the house. It seemed like a reasonable request since the home has been on the market over 250 days and we had seen it twice.

Here was her response:

“Yeah I do not have a brochure..I am sorry..I used to do brochures back in the day but with the internet clients had no use for them…”

Um, “back in the day”… are you kidding me?

Maybe you are an experienced Internet real estate surfer, but you are probably looking for something you can hold when you check out a house in person.

Am I wrong?

Seeing a house online is only the first step. You know, when you can check out the photos, the location, local schools or local shopping. R-E-S-E-A-R-C-H!

Internet clients still want to see the house

The next step is to have your buyer agent set up a convenient time to see it when the house can be yours. Don’t wait until the Sunday open-house where three other people will be on your tail in the kitchen, bathrooms or living room. Most of those people at the open house are distractions from making one of the most important decisions you’ll ever make.

A good real estate brochure doesn’t have to be complicated but should include bullet points like HVAC updates, interior upgrades, kitchen information, and list community high points if possible. Walk to Whole Foods or near the W&OD Bike Trail are selling points people! No one is going to buy a home because of a fabulous brochure, but when there is a helpful list it may provide insight into the age of the roof, heating system, or something else equally important.

Get it?

Sorry for the rant, but not putting a basic piece of helpful consumer information is a costly oversight for everyone.

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A home in Vienna, Virginia | Doug Francis via Flickr

For many folks, as the clock strikes 2012, careful plans to sell their home or to buy one go into action. Setting new goals is an important way of improving your life and making each new year more meaningful than the last. Our lives are short and knowing that you are personally responsible for the life you lead right now (this instant) can be an awakening. Owning a home can be an important pillar of that plan.

A 2012 real estate resolution?

If you have made a real estate resolution for 2012 then here are some of my top tips for both sellers and buyers.

Top 5 home seller tips:

• Minimize – Even if you live in a grand mansion, you want your home to appear as spacious as possible. Some common themes include removing a chair from the living room, clearing off the kitchen counters, or taking 30% of your clothes out of every closet.
• Paint – A fresh coat of paint can really transform a room at a very low cost. Instead of the white that we used to recommend, using a classic color that is in style will appeal to today’s picky home buyer.
• Flooring – Nothing will turn off a buyer faster than flooring that’s in poor condition. Most hardwood floors can be refinished or super-cleaned (even 50 year old hardwoods). Carpets can be swapped out in a day. And vinyl floors cab be replaced.
• Landscaping – Home buyers started to assess your home as they pull up, so you want to make sure your yard, plantings, driveway and front door are looking their best. Handles, door knockers, doorbells and front a mat all set the stage for what they see next.
• Appliances – Home buyers look closely at kitchens, and seeing an old range, fridge or dishwasher can be a deal breaker. Laundry machines, hot water heaters and AC units are systems that are factored in when making a decision to buy one home over another.

Top 5 Home Buyer Tips

• Price Range – Your mortgage lender will pre-approve you for a maximum price range, but it is up to you to decide how much you really want to spend.
• Long-term Needs – Buying or selling a house is expensive, so it is essential to consider what your situation will be like in five years. Will you have children, be retiring from your job, or relocating out of the area? Any of these factors need to be calculated into making your home selection today.
• Quick Decisions – Being able to make decisions quickly can especially help you in the active Northern Virginia real estate market. Get to know the sales contract and the process for putting in an offer quickly when you find a home that fits your needs.
• Flexibility – Your willingness to compromise will help you be successful. For example, buyers looking at Vienna VA homes often make a compromise on smaller homes because of pricing and commuting times.
• Teamwork - This process will easily involved fifteen important people who are all working on deadlines, and each can easily disrupt the flow of the process. Online home searching is the easy part of the process. You should view your real estate agent as the project manager helping you understand your options, meet deadlines, be a resource and ultimately achieve your goal of buying a home.

If you have made a resolution for 2012 to buy or sell a home in Vienna, VA or virtually most of Northern Virginia, you can start be meeting me here on my blog and then having me over to see your home to see what it is worth, or to meet to discuss your plans to buy a home and how I can help achieve your goals. Send me an email at doug@DougFrancis.com and I will follow up from there.

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The land is more valuable

When I walked into a neighbor’s Vienna Virginia rambler recently to give her an idea of what needed to be done, I had to be brutally honest about a strategy for selling it. Since she and her husband bought it way back in 1957 when it was a brand new home (she is one of the last original owners in the neighborhood), my dose of reality wasn’t too surprising to her.

When builders built ramblers in McLean and Vienna back in the 1950′s, the area was still rather rural providing supplies to Washington D.C. People lived in smaller rooms, had smaller kitchens, and did not have the electrical power needs that today’s world requires. Back then bread cost .15¢ and calling people “long distance” was a luxury.

Since that time, Northern Virginia has grown economically with a large international airport (Dulles), the Capital Beltway and Interstate Highway System, the Metro, Hospitals, and became the home of many Fortune 100 companies. In essence, Northern Virginia went from orchards and dairy cows to an diverse economy that exceeds many country’s GDP.

The typical rambler has become functionally obsolete for today’s modern lifestyle, and now sits on land that is valued close to market value.

Have you driven around McLean or Vienna recently?

If you are trying to figure out what to do with your rambler, or “Mom’s house”, then you should consider these questions:

• when was the house built?
• has the sewer lateral ever been replaced?
• how big or updated is the kitchen?
• is there still pink tile in the bathroom?
• is there a car port?
• was the basement ever finished and is it a walk-out?
• is the roof okay?
• how old is the furnace and AC?

What I find most “original owners” can grasp is the fact that their home is in an ideal location and will probably be a perfect spot for a new, larger infill home.

What they can’t grasp is the value of the home on the real estate market.

Reading the free, local newspaper usually shows ramblers for sale that are fixed up, expended, remodeled, or have a distinct reason for appealing to today’s buyer. These home listings aren’t especially helpful when determining what a builder may pay in an as-is sale.

Home builders desire those infill properties

It is important before talking with a builder (who is an investor) with me to get an understanding of current values, because it is essential to know the value of your home in his eyes. And that is where I provided valuable insight to my neighbor because we were able to discuss a price or value range without remodeling her kitchen, fixing her baths, painting etc. As a result she will net significantly more by not doing all of those projects…

On a personal aside, I bought a 1957 rambler back in 2003 with the plan to gut the interior and add an upstairs addition. The home had sat on the market a long time and the seller had done a good number of upgrades. But, I will never forget her comment when we told her our plans… “then I never would have done those updates”.

No, I didn’t tear down the house but the floor plan is radically different from the original plan and designed for modern living.

So the reality is that your McLean or Vienna home is functionally obsolete for today’s styles, but your “real estate” still has real value.

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Will my home ever sell?

After 60 days on the market you may start to panic… or take it personally.

Been there, seen it before. It is hard to be rejected by 25 people.

At REALTOR training school, the instructors tell us it must be “x” and we need to do our best to make a case to help you understand the facts. Of course they don’t point out that we (REALTORS) should have covered “x” more clearly 60 days ago when we were having you sign the listing agreement.

The “x” is your current asking price, but from my experience there are typically a number of issues that need to be addressed before you make a difference.

It’s more than a price adjustment

Here are some areas to take a second look at:

• How is your front yard, door? You know the old saying about first impressions…
• How clean is the house?
• Have you painted recently?
• How much stuff is on your kitchen counter?
• How much stuff is on your bathroom counter?
• What is the condition of your carpet?
• and on and on and on…there are just too many tips to list

Okay, you don’t need to go down a checklist because you need to take a real look at the saleability of your house.

Yes, I think your Vienna home will sell, with some help

Did you know that home buyers are taking their first tour of your home online?

Take a minute and put your address into Google and you should see it listed on multiple web sites. Understand that the photos all came from the MLS listing, and then get pumped through the Internet via a high tech syndication process. How do your photos look? If they looked crappy then they probably turned off almost everyone who saw them. You need to be proactive to make sure changes are made quickly.

My point is that the condition of your home is critical and that the online photos that people see have to catch their attention or you’re toast.

Photo Credit: Yuri Arcurs, iStockphoto

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Classic colors are essential

Ever had a moment when you realized, “Hey, I’m one of those people!”?

That happened to me when I was showing “newer” homes to a client and kept pointing out how the homes would show much better properly painted. After 3 to 5 years they were still “builder’s white” and looked dirty.

As I walked into my own house at the end of the day, I realized that, yikes,  I was one “of those people” too.

Pick a color that will appeal to home buyers

Painting is probably the easiest thing to fix when you are planning to put your home on the market. It is essential to think strategically, which is Realtor Code for painting a color that will appeal to today’s home buyers. Finding an “in-color” is tough, but easily enough achieved thanks to countless Pottery Barn catalogues, Google, HGTV, a home stager/designer or a plugged-in real estate guy.

I have seen paint totally transform a 1950′s Vienna Virginia rambler, and shock the owner of a five year-old colonial in Clifton. After seeing the photos online of the finished job the homes looked totally different, and that is essential since your first showing is now taking place online from the comfort of the home buyer’s kitchen counter (you buyers know where you are, Panera?).

William Gonzalez

For the rambler in Vienna, it was easily painted by my trusty handyman John Blizard ( jblizard@comcast.net ), but for the bigger jobs I suggest calling in a painting crew. Recently some clients have used William Gonzalez’s ( wgmypaint@yahoo.com ) company, My Painter which is licensed and insured to get the house prepped and painted  (takes 3 to 4 days). The speed and quality of a professional crew makes is well worth the expense.

Some recent paint selections:

• Hawthorne Yellow – Benjamin Moore, flat/matte finish
• Sandy Hook Gray – Benjamin Moore, flat/matte finish
• (to see more photos of a home with Sandy Hook Gray, click here)

Take a look at the exterior of your house close up to see if there is paint chipping or fading. Some people wind up with black spots all over their nice white trim boards. That actually comes from all the wood mulch you spread around your house (at least here in Northern Virginia) and is a natural mold. With so many homes here built with vinyl or HardiePlank siding, often a good power wash solves the trick… but your trim work still needs some painting.

Home buyers will be staring at your front door

Last, but not least, one of your most important “first impressions” is your front door. From my experience, often a full minute is spent at the front door as the Realtor is opening the lock box, fiddling with the keys or ringing the bell waiting for you to get your arse to the door. So make their wait special with a freshly painted door, and, by the way, that old door handle and knocker may need replacing too.

After I painted my own house, it was amazing how much more comfortable it was. So don’t wait until you plan to move to make it look like you live in an episode of Divine Design.

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Image via Wikipedia

There isn’t anything worse than waiting for an answer.

Yes or No. Come on man, just let me know!

The tip that I give my Northern Virginia real estate clients is to respond to any type of offer quickly, and to take every one seriously. Speed is very powerful when negotiating.

In real estate, a quick response is powerful

If that answer is too vague and you need just a little more structure, then maybe these guidelines will help:

• in by 10:00 a.m then respond by noon
• in by 1:00 p.m. then respond by 5:00 p.m.
• in after 6:00 p.m. then waiting until 9:00 a.m. is okay (you can sleep on it)
• Communicate if there is a delay… and stick to that time frame

Problems happen when an offer comes in and then one party doesn’t respond back in a reasonable amount of time. In the Cold War days, it was acceptable to be a slow responder like if you were behind the Iron Curtain or if you were on the QE2 sailing to Sydney.

Here is the warning: When the submitting party has to wait,  festering begins. Are they “shopping my offer?” they ask. Are they using it to “leverage some other offer?” they ask. “Did they even get our offer?” they ask. Recently, clients negotiating on a house in Vienna broke off negotiations because the seller was dragging his feet and they, justifiably, were insulted.

Today it is just too easy to respond quickly using secure digital signatures on any laptop or iPad. A few years ago I started to use DocuSign after a client couldn’t fax his paperwork to me from Austin. This service alone has helped my clients respond quickly in competitive situations, and it actually comes across as much more professional considering so many companies have adopted digital signatures too.

DocuSign uses e-mail to secure your signature and “the cloud” to merge the completed document then delivering it back to me. Even if you are in your office in McLean, it is so easy that you will be able to respond instantly.

Remember, respond to real estate offers quickly for the best results.

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The new fence

Our decision to get a dog was the final reason to install a fence in my back yard. I always liked the free-flowing yards we had which allowed the kids to run or sled from yard to yard but, I have to admit, the yard looks good with the new fence.

Is a backyard fence going to add value when I sell my Vienna VA home?

After helping hundreds of people buy all sorts of homes, I have rarely had a client dislike a fenced yard. It seems that they define the space and give home owners the framework needed to landscape or set up a kid’s swing set.

A few years ago, a nice couple looking for their first home told that they “did not want to see any homes with chain-link fences”, which was especially funny since they wanted a home in Arlington VA. Well, Arlington VA probably has the highest concentration of chain-link fenced yards in the nation. (that fact has not been verified, and just to be fair, I have seen plenty of Vienna VA ramblers with chain-link fences.) The point is that chain-link is out!

Trying to track down a “return on investment” statistic for you has been impossible, but in my opinion a well maintained fence will increase the appeal of a home and return dollar for dollar what you sunk into it. An old rusty chain-link fence will probably work against you as most home buyers look at those as high priority items for replacement. Home buyers will factor “fence replacement” into their offer or ask for a closing cost credit to preserve their cash position.

Tips for fence sitters:

• Local fence companies often attach a tag at a corner to identify their work, give them a call.
• Get an idea of the style you want… that will compliment your neighborhood (no spite fences, bub!)
• Get two or three estimates from fence companies you have already Googled
• Understand fences should be built to last, and even a small back yard fence will cost over $2,000 (in Northern Virginia)
• If you live in a community with an home owner’s association, there may be restrictions on the style of fence you can install and have a requirement that you submit a plan for approval prior construction.
• My fence was installed within a week by a local Dunn Loring VA company, Carter Fence.

Tips for home sellers:

• Replace any missing or warped boards
• Have a handyman power wash your fence
• Understand that your fence should be a “selling point”

Yes, home buyers do look for fenced yards and, yes, a well maintained fence will add value to your home.

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Copyright Dreamworks - Permission Requested

If you are planning to sell your home anytime in the future then you should start cleaning right now. In the old days we used to say… give it a “white glove test” but most people under forty wouldn’t automatically understand that reference.

People want to buy clean homes!

It seems that many people miss this one point when they are putting their home in the market or feel that it is clean enough because “it’s gonna be cleaned when we move out”.

But here is my professional Realtor tip of the day… “clean enough” is too subjective. There is a classic scene in the movie American Beauty when Annette Bening, who plays the role of a real estate agent, scrubs down a house before her Sunday “open house” and gets a little of her frustration out of her system before becoming Realtor-charming again.

Although this movie scene always gets a laugh, anyone who is in the business knows that CLEAN sells.

Earlier this year I advised a client to clean up his 1950′s Vienna VA rambler, and it sold very quickly. When he first asked me about selling the home and I took a look at it, I knew that it had potential to sell if it was cleaned and painted. It took about $10,000 to get that place in shape but it got the result he was hoping for. And I get this type of question all the time from people who ask about selling their home which they may have lived in for decades.

Hey, this isn’t a Realtor tip just for Vienna or McLean VA homes!

A client inspired me today to write this post… because his 10 year-old town house really need that final cleaning before hitting the market. It is kind of like that final wipe-down that gets the dust, hair or marks off the wall. Often it is the newer homes that have the most dirt and dust around the edges, and it seems just as bad in homes priced at $300k or $1.2 million.

I often ask readers to switch hats for a minute, and now imagine that you are a home buyer looking at a dozen homes today. Aren’t you expecting to see homes that are in tip-top condition?

Here is tip that a handy man gave me that has taken many marks off the walls, possibly ones in your house. Until you try the “Mr. CLEAN’s Magic Eraser” you aren’t going to believe that most of those marks on your walls really can disappear with this little white sponge that you picked up at Giant or Lowes for $3.47.

If you can think CLEAN before you put your home on the market for sale then you will have a much easier time finding a buyer for your home in a short amount of time. CLEAN pays for itself because it often involves only a little extra time, energy and care.

What do you use to take clean to the next level?

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Of course there are plenty of SM gurus out there who are preaching a very different answer to my question, but I really don’t think they have any idea what it takes to sell a home or the tools that I see actual home buyers using every day. People aren’t hanging on every Tweet mentioning their local real estate market (okay, maybe Realtors are) but Northern Virginia buyers Bob and Mary Beth certainly aren’t.

Bob and Mary Beth are putting in their criteria (see below) and are waiting for an e-mail alert with snappy pics.

Promoting you’re on Facebook or Twitter has become, I dare say, …cliché.

Using Twitter is only one pillar of Social Media strategy

So what will sell your Eudora colonial in that cute suburban cul-de-sac to Bob and MB? The old-fashioned truth is that your home needs to be in excellent condition and priced right. Vienna VA home buyers are looking at online photos of your home on sites such as Homesdatabase, Trulia, Redfin or Zillow only after they have received an e-mailed “alert” from the site. Often on their iPhones during a meeting at work.

And if your house passes that test only then will they show up for an in-person tour.

They aren’t searching for Tweets at #ViennaVARealEstate

Last year I “liked” a Facebook page for a real estate brokerage on Nantucket after stumbling across a post, but the result was a wave of  Facebook spam of hot new listings every thirty minutes. These were people who did not “get” what social media can do for their cause, but were viewing it as a free advertising opportunity to crush the competition. They were missing the point of it all and I promptly “un-liked” them.

About 600 million people, including myself, have found Facebook to be an opportunity to have fun with people from many parts in our lives. I haven’t lived in Vienna my whole life so to reconnect with old friends from Boston or Providence makes me understand that the world is a much smaller place, and that my life is actually pretty normal. (Okay, normal is subjective)

To properly sell your home, get it ready for the market, have great photos online, tell your friends that you are moving, and then the “social internet” will spread the word about your home being on the market. Using Facebook to tell your friends that you are moving to Florida will create the natural conversation about your Vienna house being on the market for sale. The concept here is very different than that of the realty firm on Nantucket… because you are leveraging your social network to help sell your home.

Believe it or not, your friends will be rooting for you to get your home sold.

For more real estate strategies, read my blog some more or send me an e-mail.

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