Getting an Inspection Before You List Your Home

Houston Real Estate

Houston Real EstateOne question we are routinely asked by clients who are thinking of selling is, “Should I get my home inspected before we try to sell it?”.  The usual thought process being that if there is something wrong, let’s find out about it now and get it fixed before it surprises us.  That makes perfectly good sense.  As you might expect, the answer isn’t always that easy.

Disclaimer:  What you are about to read is not legal advice.  It is simply my opinion and I am not a real estate attorney.

First, in the State of Texas, you are required to disclose any inspection reports you have that have been done over the past four years.  So, keep that in mind when you are thinking about getting one done.  You won’t be getting it just for your peace of mind.  You will have to share it with your potential buyers and unless you are going to fix everything on it and prove it, you might be opening yourself up to negotiating from a weak position.

Second, and this is important to remember, every inspector is different and no two inspection reports are ever the same.  What I mean by that is you should not be at all surprised when the inspection report you get beforehand is clean and the one that the buyer gets done has some issues on it.  Remember, inspectors get paid to find things that are wrong.  Ten years into this and I have still yet to see a totally clean inspection report.  The State of Texas has done a good job making sure that there is a fairly standardized process to home inspection, but they’re still done by humans so there will always be differences.

On the other hand, if you’ve lived in the home for a long time and maybe aren’t the best at maintenance, it might be a good idea to have one done so you have a “to-do” list before selling.  Remember, it’s the little things that count when it comes to selling for the most money, so taking care of some deferred maintenance is never a bad idea.  For many people, ordering an inspection may be the best way to know what they need to do to get the home in selling shape.

At the end of the day, it really all comes down to what gives you the peace of mind to move forward.  My biggest piece of advice to you if you do decide to order an inspection prior to listing your home is to review it with your Realtor before you go spend a bunch of money fixing things that don’t need to be fixed.  Remember, inspection reports often call things that weren’t code when your home was built.  Your Realtor can help you determine which items need attention and where your time and money can be invested in areas like staging that will help sell the home for more money.

 

E-Pro Certification

Houston Real Estate

Houston Real EstateAs more and more consumers begin their search for real estate-related information on the Internet, it is critical that real estate professionals stay on top of the latest technology for the benefit of consumers and real estate practitioners alike. The e-PRO Technology Certification Program fills that need.

Realizing the importance of technology training, the National Association of REALTORS® (NAR) created a comprehensive Technology Certification course in 2000. And now that course, e-PRO, has been completely updated to include information on Social Media and Web 2.0 aspects that is, and will continue, to change the real estate business.

“The real estate industry has undergone a fundamental change over the past five years,” Chance Brown said. “Today, more than 90% of all buyers and sellers begin their search online. As an e-PRO certified agent, I have knowledge and tools needed to provide my clients with the information they need and the customer service they demand. It’s both hi-tech and hi-touch.”

The all new e-PRO certification course — the only technology certification program offered by NAR — is designed to prepare real estate professionals to make the most of Internet technology and to identify, evaluate, and implement new Internet business models. The elite group of course graduates represents only four percent of all REALTORS in the country, including Chance Brown of Chance Brown Real Estate.

The e-PRO certification course is an educational program unlike any other professional certification or designation course available, comprehensive and interactive. It is specifically designed to provide real estate professionals with the technology tools needed to assist consumers in the purchase or sale of a home.

The exclusive e-PRO certification course is presented entirely online and certifies real estate agents and brokers as Internet professionals. The course is designed to help REALTORS stay at the leading edge of technology and identify, evaluate and implement new Internet business models.

Once completed, the e-PRO certified real estate professional joins the ranks of a special community of highly skilled and continuously trained professionals who provide high quality and innovative online-based real estate services.  Consumers can identify the e-PRO through the exclusive e-PRO Internet Professional logo.

Case-Shiller is Crap

Houston Real EstateThere are few things that drive me more crazy than national news agencies telling me what the real estate market is based on what is happening in either New York or LA or because of some foolish index says.  I think it is irresponsible, unprofessional, and, more importantly, wrong 90+% of the time.

For those of you unfamiliar with the Case-Shiller Index, it comes in a few varieties.  The one most commonly referred to in predicting real estate market trends, specifically pricing trends, is a 20 city composite of sales price data.  There is also a 10 city composite and a couple of others.  Now, while I believe that Kase, Shiller, and Weiss, the guys who came up with it, had the best intentions when it comes to compiling reliable data on pricing and market trends, it has been co-opted since they sold out to Fiserve and S&P.  They even trade futures on the Chicago Mercantile Exchange based on the data.

There are two major reasons why I really don’t like this format for looking at national housing data market.  The first is that it is inherently flawed in that real estate is hyperlocal, not national.  Second, it omits some of the most active markets in the US.

Real Estate is Hyperlocal, not National

So, let me ask you this: If you needed to know the weather in Houston, TX this weekend, would you look at the weather in Boston to predict it?  Of course you wouldn’t.  It’s really the same problem as national political polling.  Who cares what is happening in Ohio if you live in Colorado?  It is an even bigger mess when you take the Electoral College into account.  Why even do a national poll on presidential politics?  Now, you might think, much like the Dow Jones Industrial Average, that taking a composite of the larger real estate markets out there might give you a good idea of the big picture, right?

Well, again, that is a fairly flawed premise.  The reason is that inside of each city you experience a more local version of the national problem.  For instance, in the Chicago real estate market, there are enormous shifts in sales prices and activity throughout the different areas of the city.  Telling me that my house won’t sell in Chicago because an index of the entire city says it won’t is nuts.  I need to know what is going on in my neighborhood.  I need a local Realtor to pull sales data and show me current trends that affect my property.

Where’s The Beef?

So, you can find the index cities by checking Wikipedia, but let me give you a brief synopsis.  It has a bunch of big cities and metro areas in it.  However, it leaves a few of the big ones out as well.  The crazy bit is, that since the inception of the Case-Shiller Index in the early 90′s, it has left out one of the hottest and largest housing markets in the country, Houston, Texas.  It also leaves out Austin and San Antonio, Texas.  Why is that important?

The Case-Shiller Index has grown in popularity with the growth of around-the-clock news organizations, particularly those that are business oriented, i.e. FoxBusiness, MSNBC, CNBC, etc.  It has also become an ever-increasingly popular measuring stick since the downturn that hit the US housing market in 2007-ish.  During that time, Houston, Austin and San Antonio have set the pace for the US real estate market, along with the Dallas-Fort Worth Metro, which is included in the Index.  So how can you tell me that the US housing market is terrible when you are missing the 4th largest city in the country and 2 of the other top 10 markets in the country during that time period?

Believe me when I tell you that I don’t need to be told that the housing market in Detroit is terrible.  In fact, I would argue that Detroit should probably be dropped from the index.  I would call Detroit an extreme outlier.  In stark contract, especially in the past 5-6 years since the housing downturn began, the Great State of Texas has been the driver of the national economy.  As such, the Texas markets should be included if you want to paint an accurate picture of the national market.  I mean, if you’re going to include Tampa Bay and Cleveland, don’t you at least think that Houston ought to be in there?

So, as you can see, I put very little stock into this measurement and I think you should completely ignore the national news media if they tell you the sky is falling.  In every market, in every city, there are good times and bad.  Real estate is a historically cyclical corner of the economy.  My advice to you, for what it is worth, is find a local Realtor who know the market and get a local opinion, based on hyperlocal data, and not from a talking head in NY, LA, or Atlanta.

Selling Your Home When You Have Pets

Houston Real EstatePets are part of your family.  Chances are that when you look back at the home you are selling, your pets are a big part of the memories you have made there.  As much as we love our pets, they can pose several problems when you want to sell your home.  Planning ahead can save you a lot of time and stress.  Here are some of our tips.  Feel free to share your own at the bottom of the page.

Take a Look Around

Take a look at your yard and your house for signs of wear and tear caused by your pets.  It could be bare spots in the yard to stained carpet, but you need to spruce it up.  Get the carpet cleaned, lay down some sod, fix the fence, or whatever it is you need to do to minimize the pet effect on your house.  (I like to recommend this, if you have them, in conjunction with cleaning up after the kid effect, especially the little kid effect).  The second part to this equation is keeping the pets from recreating the same damage between the fix and the sale.  That will be the tough part, but it is vital to the success of your listing.

Take a Sniff (or, better yet, get someone else to)

I know, your pet doesn’t smell.  You had her/him for 10 years and no one has said a word.  Even when you’ve been gone a few days and come back to the house it doesn’t smell.  Trust me, you can have all the Scentsy warmers in the world and your house still has an odor.  It is the number one feedback we get from other agents on our clients with pets.  It doesn’t even have to be a strong or necessarily unpleasant odor.  I can’t emhasize this point more strongly to a seller: deodorize your house.  Get the carpets cleaned, change the air filters more regularly, and vacuum your upholstered furniture.  Then, get a friend who will be honest (or your agent if they will be honest) to come over and walk around the house sniffing.  If you have a friend that is sensitive to pet smells, be sure that they are screening for you.

Pick Up After Them

Just like kids, pets leave little tell-tale signs that they have been there.  Pick up after them during the sale just like you would a kid.  Chews and toys, food and bones, and anything they leave around the house should be put away each day.  There are two more important things to pick up, however, hair and poop.  Hair around the house, if your pet is a shedder, will increase the likelihood of odor and looks like you don’t clean your house.  Also consider that your prospective buyer might have allergies or just doesn’t want animal hair on them.  Worse than that, is poop.  Pick it up.  Daily.  Treat your yard like you were at the park.  Picture your buyer checking out your manicured back yard and falling in love with..SQUISH!  Now they have poop all over their shoe.  Maybe they do the best they can to clean it off, maybe they don’t know it’s there.  Either way, that poo is coming inside your house.

Should They Stay or Should They Go?

Last, but certainly not least, is the question of whether your animals should be at the house during showings.  In an ideal world, no, they, like you, shouldn’t be there.  Last I checked, though, none of us live in a perfect world.  So, when it is possible (considering your pet is portable), take your pets with you when you leave for a showing.  If the showing is while you are at work, crate them and place the crate in a room that is out of the way.  If you live in a climate that allows it, you might even put them in the garage if it is conducive to pets and safe.  Try your best, as painful as it might be, not to leave them out.  This goes for the back yard especially.

The people that are coming to view your home have likely selected it out of a much larger pool of prospective homes to buy.  They took the time to set an appointment, take time from their day, potentially travel a long way to get to your home.  They are there to focus on your home because it might soon be their home.  Your job as the seller is to make that 15-30 minutes that spend in your home as easy on them as possible.  That means pleasent odors, no loud barking or animal jumping on them, no stepping in poop, or any other distractions that can take them away from falling in love with your home.

 

5 Things to Know About Appraisals

Houston Real EstateHaving a solid understanding of the appraisal process can help you get a fair deal when selling or refinancing your home.

Though all appraisers are bound to act in accordance with the Uniform Standards of Professional Appraisal Practice, or USPAP, appraisal is not an exact science. Appraisers use their skills and knowledge to give their best opinion of how the value of your home compares with similar homes in the neighborhood. Here are some things that you should know about how this process works:

1.       Appraisals are unbiased. Whether it was you or your lender who ordered the appraisal, the process results in an impartial opinion of the value of your home. An appraiser uses a home inspection, property information, and market research to determine an accurate value for the home for a specific time period. The appraiser will not factor in any personal issues that you may have or any reasons that you may need to sell right away.

2.       Home values can change quickly. An appraisal is merely a snapshot of your home’s value at a certain date. If you decide to sell your home three months after an appraisal has been completed, the market price may be higher or lower depending on how things have changed, and you will likely have to have your home re-appraised. If you know that you will need an appraisal at a future date, you can ask for something called a prospective appraisal. Let your appraiser know that this is your intention.

3.       Appraisals can be used for different purposes. Appraisals being used to figure out your home’s market value will likely result in a number that is slightly different from appraisals being used to determine your property taxes. An appraisal for insurance purposes, for instance, usually determines the cost of what it would take to rebuild your home from the ground up rather than what the market price is.
If you ordered the appraisal, make sure the appraiser knows for what purpose you ordered it and what your interest in the property is. If your lender ordered the appraisal, ask what criteria were used to make the final determination of value.

4.       Appraisals rely on accurate information. Don’t try to withhold information from an appraiser or misrepresent the facts. Your appraiser needs accurate information to give you a fair value, so if you are asked to provide a property tax bill or other information, do so. Not giving this information may delay the appraisal process and may result in an appraisal that you are not pleased with.

5.       You can ask for a second opinion. If you feel as if your home appraisal is inaccurate, you can ask another appraiser for a second opinion. Be aware that you will need to pay for this second appraisal yourself, but in many instances it may be a small price to pay in order to sell your home at its true market value.

What have been your experiences with home appraisals? What are your tips for getting an accurate value?

This is a guest post from Amy Burweigh, who works in marketing and real estate at Aim Your Way.  Aim has provided a variety of property maintenance and preservation services as well as inspections for over 20 years and can be found at www.aimyourway.com.  Connect with Amy on Google+.

Using Storage When Moving

This is a guest post from Joseph Ver at www.sparefoot.com. SpareFoot helps you find the right self-storage center for your needs.  Click here for more info.

Houston Real EstateWith a stack of about fifty sheets of papers that I had to read for an upcoming project, I decided to watch some television as I faced this daunting task. As I flipped through various channels (Guy Fieri eating food, a group of people designing a house, a bad reality show on “music television”) I finally settled with another fairly bad reality show: Storage Wars. Now I say that somewhat facetiously as I can allow myself to indulge in a little “bad” reality television. Plus, Storage Wars is a thirty minute show that requires no commitment to actually watching it. I could passively watch it while I underlined and took notes on the population policies in China. But while I was watching the show, I couldn’t help but think about the different reasons why people have things in storage. Why were these items that they are auctioning off in these units in the first place? People use storage for various reasons and don’t really think about it until they need it. When putting your home on the market, here are some ways you can use storage when you need it.

Relocating in the same city. Not every person moves due to job related circumstances that forces them to relocate to another city. Some people just want a bigger home. When you plan on relocating in the same city, try renting out a storage unit to cut down on the stress. Slowly ease into your new home instead of moving in all at once. Bring in a few items throughout a time period (a few days, weeks, or a month) and store things that aren’t absolutely necessary in a storage unit. I equate this to buying a new fish. Before you place your fish inside the tank, you want it to get used to the water temperature first, so you place the bag that the fish is in the water for thirty minutes to allow the fish to acclimate to the temperature. By slowly moving in, transitioning will go a lot more smoothly for yourself and your family.

Staging your home. Before you move, you might need to sell your home first. Many people talk about the necessity of home staging. (Editor’s note: you can view my series on staging by clicking here.)   The process can sound daunting, but depending on the condition of your house, it can be as simple as making sure the grass is clipped, to very complex as flipping your rooms upside down. You can always get a professional to help stage your home, but if you lack the funds, here are a few tips to take in consideration. Make sure that your house is decluttered. When someone comes in to view your home, they are imagining themselves in that new living space. Sure they’re not going to have your furniture, but if a bedroom looks cramped due to a bulky treadmill, then they’re going to think that room is cramped. Open up your space and think about placing things, like that treadmill, in a storage unit. You may have an antique lamp that has been handed down from your family, but if it causes a room to look off, stow it away. The most important thing in staging your home is putting yourself in the shoes of the buyer. Throw trash away, make your beds, and keep the sink clear.

Selling your home and finding a new one can be a very stressful process. If you find small simple ways to make things a little easier, they will add up and make the experience less stressful. Think about using a storage unit. Not in the market? There are still ways to use storage that are relevant to this information. Now excuse me, as I watch another episode of Storage Wars.

Do You Need a Property Manager?

property-management

Houston Real Estate property managementDo you need a property manager for your rental property?  For a number of reasons, more and more people are turning to property managers to provide services in excess of what they have typically been known to do.  Today’s property management teams aren’t just there to find tenants, collect rents, and help make repairs like they once did.  In many cases, they are helping make the determination of what to buy, handling the rehab, and even doing market analysis for sale.  They are adding these value added services to help people better answer the base question:

Do You Need A Property Manager?

Let’s start by breaking down who you are into one of these three categories: homeowner, real estate investor, multi-family owner.  The answer and the reasons why or why not will change significantly based on each.  If you are in one of those three categories (fingers crossed that I didn’t leave anyone out), you can scan down to the category you belong to or you can read each and maybe learn a little.  Your choice.

You are renting out your home – Homeowners

For whatever reason, you have found it necessary to rent out what used to be your primary homestead.  Let’s say you got relocated and were underwater on your mortgage and couldn’t afford to sell.  So, now you need to find someone to live in your home and then help out with repairs as they arise.  Also, it would be nice to make sure someone kept an eye on the place to make sure the new tenants weren’t destroying the place, making it even harder to resell once you are in a financial position to do so.

Here’s what you could do: You could find an agent to list your home for rent, take out some ads in the local paper or on Craigslist and get a tenant in the home and paying rent.  Then, if they called and something needed repair you could just do a Google search or ask old friends for a recommendation and call them in.  Seems simple enough, right?  What happens when they stop paying rent?  What if you can’t oversee the repairs to the property and they aren’t done to your liking?

Here’s what you should do: Hire a property manager.  Period.  If you aren’t going to be around, you need someone who will be.  You need a Landlord who will be present, proactive, and professional.  For a nominal (and tax-deductible) charge, they can find and screen tenants, use their network to make repairs the right way, and collect rent, deal with the tenants and anything else that comes up.

 

Your are a Real Estate Investor

Well, this really depends on you, your personality, and your experience.  It might also have something to do with the location of your rental properties.  The question you need to be able answer honestly is: “Do I have the time, temperment, and know-how to be a good landlord?”

If the answer to that question is yes, then chances are, unless you own a boatload of rental properties, you probably don’t need a property manager.  The exception to that, of course, is personal preference.  If you don’t want to deal with it, then hire one.

If the answer to any part of that question is no, then you might want to consider hiring a property manager.  There’s nothing to be ashamed of by doing so.  You have a financial advisor for your investments and an insurance agent for your insurance.  So, why not think of a property manager in the same light.  They are there to make sure that your investment is performing the way it should, for a nominal (still tax-deductible) fee.  Whether you just don’t think you have the time because of your full-time job, or your rentals are in a bad part of town, or you just think that your tenants might take advantage of you (a common mistake by new investors), property managers can give you the peace of mind to know that your investment is performing the way you planned on it.

Side note: You might also see if your property management company can help you with the rehab on your property.  Most have a network of contractors and get a better price than you can.

 

You are a Multi-Family Investor

I’ll make this one real easy.  Chances are if you own a building with more than 6 doors, you need, at the very least, a handyman.  Maybe not a property manager unless you are experiencing a lot of turnover in tenants, but it would be, well, handy to have someone on call to help with repairs.  If you get into a bigger project, but not big enough to staff a permanent leasing agent, then a property manager might make very good sense and you can probably cut some sort of deal with them instead of the standard percentage of gross rent arrangement.

 

Hiring Your Property Manager

There are two major things you want to see from a property manager.  First, a scope of services that is well laid out and part of your agreement with them.  Second, you want to make sure that they actually have a track record of performance.  Ask for referrals from current clients.

You also want to make sure that you are accounting for their fees when you make your purchase decision.  For example, let’s say that your monthly note on a property is $800 and you are charging $1000 for rent.  You are making $200 a month.  However, adding in the average rate for property management in my market, you are only making $100.  Would that affect your decision to purchase that property?  Depending on the equity, it probably would.

Finally, you want to make sure that you are free to leave the contract if you feel that you are not receiving the service you are paying for.  Read the agreement carefully.

 

The Bottom Line

Property Managers can be a very valuable part of your real estate team.  They can give you a peace of mind that your rental is being taken care of by professionals that really know how to make your investment perform.  However, they do come at an expense to your bottom line.

The question is, and will remain, “Do you need a property manager?”  Like most other questions when it comes to your money, you are the only person that can answer that question.

Is Fixing Your Home To Sell It Worth It?

home-repair

Houston Real EstateSo, you’re busy and don’t get around to all of the little things that need to be done in your home.  Because of that, you have some deferred maintenance.  Join the club.  Maybe your carpet is old or your roof needs help.  Now you want to sell your home and don’t want to come out of pocket thousands of dollars to sell it.  So, what do you do?

One of the things I hear on a pretty regular basis is, “We need to do a few things around the house before we put it on the market.”  OK, fair enough.  Chances are that you’re right.  Two questions for you.  First, do you know which things that you need to do to satisfy your market?  Second, if you didn’t have the time, money, or both to do them before, what makes you think that you are going to have the time, money or both to do them now?

Do You Know Which Things That You Need To Do To Satisfy Your Market?

No offense intended here, but the answer is probably not.  Just because your neighbor did this and sold his home for that doesn’t mean that you need to do that or your going to get the same amount by doing so.  Much to the disbelief of a lot of people, homes are not commodities.  Just because you don’t have granite and the guy down the street did doesn’t mean that you need to go out and install granite.

True story about the first home I ever owned.  Before I was a Realtor, I was selling my first home.  I happened to have had a fantastic Realtor sell it for me.  My home had less in amenities than several others for sale, had been lived in by a couple of mid-20′s single dudes, and was in no other way superior to comparable units.  My agent helped me stage it, we priced it higher than anyone else by several thousand dollars, and sold it for nearly full price in 23 days.  I made zero repairs.  If I had, they would have been a waste.

So, without a market expert to assist you, it is very possible that you would be throwing money away.  Bottom line, if you feel like you need to do some work on your home, at least let your agent take a look and consult with you on what should or shouldn’t be done.  Also, make sure to hire an agent that knows about staging and what will sell your home in your market area.

If You Didn’t Have The Time or Money Before, What Makes You Think That You Will Have It Now?

This is actually a three part question.  The second part is, “What is that delay going to cost you in your market?”  The third question, of course, is “Is it worth it?”

Again, you have an idea of what you think you need to do to sell your home.  Again, you are probably wrong in at least one area of that assessment.  So, why waste the precious time and money doing things you don’t need to?  If it is going to take you a month to make the repairs, what are you missing in that month that you aren’t on the market?  Don’t waste the time and/or money.  I use the term waste, because it seriously is a waste.  You might as well set the money on fire.

A good agent can help you decide what you really do need to do, when you need to do it, if an allowance is a better option, and/or what not to do because it isn’t necessary.  If time is a genuine concern, and you have a time in mind to sell your home, start early.  Don’t put it off.

Examples

These are real examples that I have heard in the last month or so:

“I want to put granite in the kitchen.” – Do the other homes in your community have granite?  How much are you going to spend?  How much are you going to get out of it?  Not listed yet, but no need to put granite in the kitchen.  It is a beautiful home.

“I want to paint the garage.” – Huh?  Why?  People generally don’t care what your garage looks like.  We sold this home in 26 days for more than market with no paint to the garage.

“We are thinking of painting the nursery back to neutral.” – Why?  Do you live in a neighborhood where buyers have kids?  Chances are people are not going to decide against a home because you had a baby.  If so, they are nuts anyway.  Sold in 6 days with multiple offers.  No paint in the nursery.

There are more, but you get the point.  Work with your agent before you list the home so your work after you list is made easier.  Trust me, it will pay off.

Bonus

Here are a couple of tips to make your home look better to a buyer.  For more, I have a series of entries on staging that starts here.

  • Rent a storage facility and get everything you possibly can out of your home.  This includes furniture that is more than a room needs, everything from your counter tops, excessive kitchen appliances, bathroom “stuff”, clothes, toys, etc.
  • Work on your curb appeal.  You only get one chance to make a first impression.
  • Buy an air freshener, especially if you have kids, pets, etc.  They cost a couple of bucks.  Buy vanilla.  You might not think your home needs it, but what is it going to hurt?

 

Multiple Offers – A Great Problem To Have

multiple-offers

Houston Real EstateSo, your home is on the market.  Your hoping and praying that it sells quickly.  In the back of your head though you have doubts.  “Is it priced right?  Did I stage everything so it shows well?  Should we have painted the upstairs bedrooms back to a neutral color?”  Then the phone rings and you have your first showing.  You open the blinds to let light in, vaccuum the floors, gather your things and go sit down the street and watch.  Maybe you go do some shopping.  Then you get home and check with your agent or showing service to see if there is any feedback.  The nerves start to set in.  Sound familiar?

Over the next week or two you get more showings and each time you are met with the nervousness of seeing if they will put in an offer.  I’ve been there.  Even as a real estate professional, let me tell you, it is nerve-wracking.  All you want is that offer to come in.  So, what happens if you get more than one offer?  I know, I know, it’s a problem that most people dream of having.  It can still pose some potential problems and I wanted to take the time to address them with you because I just went through it with a client.

Legal Clarification

Let’s start with a couple of definitions and then put them into a real life scenario.  First and foremost, an offer is just that.  It has no legal bearing whatsoever.  A Contract is a legal document that both sides of the transaction have agreed upon and executed.  The difference is huge and often muddled because many agents refer to offers as contracts just because they submit their offer on a contract form.  So, if you hear that there are multiple contracts on a property, that is false.  In the State of Texas, anyway, the law allows only one contract to be on one property at any time.  What the agent is really saying is that there are multiple offers.

What To Do If You Get An Offer

Great news!  Someone wants to buy your home.  You start to relax a little, you feel like the hard work is done, and your home is now off the market.  Don’t get ahead of yourself, now.  It is just an offer and the truth is that the hard work is just starting.  There are negotiations, financing, inspections and more that still have to be done.  There is one other thing that should be done and I’ll bet you haven’t thought about it because you are so happy that you have one offer.  Why not try for multiple offers?  Your agent should call around to the other agents who showed and see if they can’t get them to submit an offer.  What can it hurt?

What To Do If There Are Multiple Offers On Your Home

Well, first what you want to do is put down the phone and dance around your living room, office or wherever you are.  Congratulations!

If you get multiple offers, the process becomes fairly simple.  We put out a call for the “highest and best” offer and put a deadline on it (usually 24-36 hours).  At the deadline, we look over what we have and make a decision.  You take the best one for you and ask the others if they would like us to hold their offer as a backup.

What you don’t want to do is try to play the offers against each other.  Not only, in my opinion, is it a shady way to do business, but it really isn’t fair to the buyers.  Let them look it over, make their highest offer and if they get it, they get it.  There is no negotiation or haggling.  Everyone gets a shot and the best shot wins.  The main way to do this is to enforce the deadline for offers without exception.

Case Study

Multiple offers are not uncommon at all with foreclosures, but you aren’t selling a foreclosure so here is a real story of a situation that happened last week.

The home showed three times in five days after being listed and all three submitted offers.  The Sellers are building a new home that won’t be complete for another four months.  The first offer came in pretty low but offered them a chance to lease the home back until their new home was complete.  The second offer was better and also offered a lease until the new home was complete.  The third was full price but only offered a two month lease.  So, we called a deadline 36 hours later for “highest and best” offers.  At the end of the deadline, the first two offers had come up and the third actually pulled out.  The difference between the two offers on the table was very minimal but the second offer won because the Sellers were a little better off with it.  So, one week after listing the home we had a great contract that allows them to stay in the home until their new house is complete and a back-up in case something happened to the first buyers.

Not too shabby right?  Wouldn’t everyone like to have that problem.  It is not common in this market, true, but it can happen and it can be created by a little proactive work on the part of the seller’s agent.  Thinking that just because you got that first offer means that you can’t get more is very near-sighted.  If your agent is going to try to drum up more offers for you from past showings, call them on it.

 

The Right Time To Sell

House Questions

Houston Real EstateSpring is in the air and with it comes the eternal question, “Is now the time to sell my home?”  If you are selling a home or thinking about selling, of course you want to make sure that you are marketing it at a time that the most people are looking.  That is only natural because, hey, the more people that see it means the more people that might want to buy it, right?  Well, before you jump into the melee of the alleged “selling season”, let’s take a look at a few things that might change your mind.

First off, the Spring and early Summer are, historically, when we do see the most activity.  I just want to get that out there because it is true.  There is some rhyme and reason to it whether it is a new year’s resolution or it revolves around the school year or new construction peaks then or whatever the reason is in your area.  Who cares?  As long as you are getting your home out there in the mix, you are likely to be one of the lucky sellers, right?  Maybe.  I would argue that it all depends on you, your home, your agent, and your area.

 

If you take nothing else from this and maybe you think I am crazy, please remember this one thing: people buy homes all year long.  Just because you didn’t list your home during the “selling season” doesn’t mean that you can’t sell it until next year.

 

Why It Depends On You

Houston Real EstateThis is the easy one.  Are you ready to move?  Are you financially ready to sell?  What if your home sells on day 1?  Are you prepared for a bunch of strangers to be walking through your home and hopefully not, but possibly, calling your baby ugly?  Have you discussed what your financial position is regarding an offer being made?  Do you know your bottom line?

Listen, selling a home isn’t easy.  If it was do you think the real estate market would be hurting the way it is?  Due to that, it is even harder.  You have to be realistic and ready.  So consider yourself warned.  If you’ve read this and still feel ready, read on…

 

Why It Depends On Your Home

Houston Real EstateIs your home ready to sell?  Sure, you think it’s great, but would someone else?  No, really, I know you think it’s great.  I’m sure it is, too.  Here’s the problem: I ain’t buying your house and neither are you.  Here’s where your agent can help you and we’ll get more into that in a minute.

Take a tour of some model homes in your area.  That’s what your home should look like.  Staged well, fresh landscaping, clean, no clutter, lights on, toilet seats down (sorry, but it’s a pet peeve), maybe even some soft background music.  And, for the love of God, please make it smell nice.

Do you have repairs to make?  Are they worth it?  Again, a good agent can help you make those decisions.  Which brings us to….

 

Why It Depends On Your Agent

Houston Real EstateThis should be common sense, but by the number of people I see out there listing a home with their cousin or college buddy or insert loose association here, it clearly isn’t.  A good agent with a track record of success can make or break your sale.  How do they market?  How do their other listings look?  Photos sell homes so pay attention to the ones for their other listings.  If you’re wondering what a good photo looks like, it isn’t good.  How well do they really know the market area?

Probably the most important thing to look for is their candor.  I really can’t emphasize this more.  If an agent comes in and tells you that your home is just perfect and will sell in no time and the sky is made of cotton candy, please show them the door.  If your baby is ugly, they need to tell you that.  They need to be honest and forthright and get to the point.  If not, they are wasting your time, their time, and the potential buyer’s time seeing a home that they aren’t going to buy.

I realize that there is a lot of emotion in selling your home, but the truth is that selling your home is a business transaction.  You have a good to sell in a market.  So do many other people.  Buyers have particular needs and wants and it is your job to try to fill as many of those needs and wants with your product as possible.  If you don’t then they are going to buy someone else’s product.  Hammer that into your head.

Last part on this and we will move on.  You should really interview more than one Realtor.  I realize that your best friend’s husband’s old college buddy is probably a hell of a guy, but he might not be the best for you and don’t you deserve that?

 

Why it Depends On Your Area

Not all markets are created equal.  Again, that should go without saying.  Maybe you are in resort area and sales are consistent year-round.  Maybe you are in a resort area and sales only happen in the winter.  Maybe you are in a college town.  Maybe you are in a place hit hard by foreclosures.  There are as many different factors that could affect the time to sell your home as there are different market areas.  Not to beat a dead horse, but a good agent can really help you here.  Is anyone seeing a theme here?

 

So, to wrap this up, it really depends on whether you are ready to sell and if you have a good agent that can help you determine if the home is ready, if it’s the right time, and if they are willing to work hard to get your home sold.  Time of year is not as important as everyone makes it out to be.  To give you an example in December of 2011, I sold just shy of a million and a half dollars in real estate.  In January, I sold nearly 8 million dollars.  Those are supposed to be really slow months.  Don’t buy into the hype.  Sell when it makes the most sense for you to sell.

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Copyright 2012, Chance Brown Real Estate, LLC. Equal Opportunity Housing Provider. Resources