How Not to Sell Your Home

I never cease to be amazed at the condition and presentation of homes that I see for sale everyday. When I walk into a home that is being actively marketed, I immediately place it into one of two categories - staged for the purposes of selling or unfit for presentation. It is an unfortunate fact of residential real estate that home shoppers do not want to see how you live in your home, how you decorate, or which faith you believe in strongly (be it Catholicism, Buddhism, Salvador Dali, or the Fighting Irish of Notre Dame). They want a vanilla-flavored home which can be mentally decorated with their belongings, a nearly open space with enough furniture to demonstrate that theirs will fit, but not so much that it fills their view with your personal taste.

A couple weeks back on a Saturday, I visited about a dozen homes with some clients of mine. On three consecutive showings I was amazed at the poor presentation of otherwise very nice homes.

Home #1

The first home was being sold using a discount real estate company whose responsibilities are limited to putting the home on the MLS and receiving any faxed offers. The homeowner was a very nice man who wanted to sell a three-bedroom duplex-down that he and his wife had purchased just 3½ years back. The place was gorgeous – granite countertops, 42” cherry cabinets, stainless steel appliances, and beautiful angled hardwood flooring throughout the home. Even better, the home faced a very large park, which was the only thing that separated the home from Lake Michigan. It was on the lake, on the beach, on a great big green park. It was well priced.

The owner had opted to rent out the home to what was a family of four, and seemed like a family of 18. There were things strewn about the home. There was too much stuff in every room of the house. One of the three full bathrooms was filled floor-to-ceiling with junk. The floors were dirty. One of the renters was home when we came to see the condo, a young teenager, and his video game playing made it difficult to see one of the three bedrooms.

The home was exactly what my buyers were looking for, where they were looking for it, at the price they wanted. Unfortunately for Mr. Homeseller, they couldn’t see themselves living in that home, because it was cluttered with someone else’s junk and filth. The homeowner recognized that it was a terrible way to present the home, and acknowledged that fact several times.

Mr. Homeseller was probably collecting $1600/month in rent, paying $2000/month in mortgage, taxes, and insurance, and devaluing his home by keeping it on the market for months on end in an un-sellable condition. He was costing himself $400/month, but maybe tens of thousands of dollars in resale value by renting his home. The average market time in his neighborhood is about 75 days, or 2½ months. By forgoing less than $5000 in rent, he could likely sell his home in a short period of time at a far higher price, ending up well ahead of the curve. Furthermore, a full-service real estate agent would tell him that from the start, saving him months of frustration and time-consuming showings with uninterested and potentially unqualified buyers.

Home #2

The next home was a condominium in a high-rise building. Only my clients and I were at this home, as the seller’s agent had left the keys at the front desk. When I got the door unlocked and walked in, there was a floor-to-ceiling painting of a young girl slaughtering a sheep directly facing me. I almost knocked over my clients in the process of jumping straight out of my shoes. The home was filled with dark and frightening art work, some of which were classic works of art, but none of which belonged in a listed property. The seller, of course, would be taking these with him, but we never got over the creepiness of the home, which was promptly removed from consideration. My clients never made it to the window and balcony, which featured some of the best views of Chicago’s Loop.

Home #3

The third home on our haunted house tour was also in a high-rise building. The listing agent’s office was located in the lobby of the building, which was a good thing, as she had recorded our appointment for the wrong day. This was the second time she had done this to me in two attempts!

The tenants (owners?) were home when we arrived at the unit. They had been given about 3 minutes notice. Again, the home was very nice, but there were things everywhere. My sellers were extremely tentative about opening closets, walking in the bedrooms, switching on and off lights, etc, because they felt as though they were invading someone else’s home. If you cannot become comfortable in an environment you certainly aren’t going to picture it as your future home. The Pièce de résistance? We had to wait three-minutes to see the second bathroom, as one of the tenants was using it. Talk about uncomfortable…

The Moral

The moral of the story is simply this – homes need to be staged for marketing and selling purposes. I don’t ask my clients to buy new artwork, furniture, or appliances. I do, however, suggest that they rent a storage locker for three to four months to deposit superfluous items, religious artifacts, bold and unusual artwork, and posters they pridefully displayed in college.

I suggest to them that they reduce clutter, that they make any and all minor repairs (which will come up at inspection anyway), that they make themselves scarce during showings, and most of all, that they remember that I am not commenting on their taste, perspective, or lifestyle, but that I am looking at their home exclusively through the eyes of a salesperson.

Keep It Clean!

The car wash in my home town of Birmingham, MI has an expression - "A clean car drives better." While we might doubt the veracity of the claim in its literal sense, we have all felt the sensation of driving away from a car wash, detailing, or oil change; the car just feels so much better.

The same holds true for the marketability of a house. A clean house lives better - sells better too. Certainly a clean house and a dirty one have the same objective market value (if such a thing truly exists). A clean house just shows so much better.

Prospective buyers like to, consciously or subconsciously, picture themselves living in "their" new home. They mentally arrange their furniture, hang their pictures, and make their first dinner in the new kitchen. When they see hairs on the bathroom sink (or elsewhere), dust on entertainment center, or smudges on the kitchen counter, they no longer want to live there. Sure, all of our homes get dirtier than we like from time-to-time. We get busy or distracted, or we'll "do it tomorrow". But who wants to move into an already dirty home?! Not many.

Rationally speaking, when investing $200,000, a half million, or even several million dollars on a new home, the immediate cleanliness of it shouldn't really factor in. For $100 you can hire someone to scrub the place from floor to ceiling. What's $100? Well it's about 0.025% of the average Chicago purchase price.

It's also often the difference between getting a second showing on your home and not.

Don't Wait Until Spring to Sell Your Home

Many homeowners that I've spoken to over the last couple of months have asked if the spring would be a good time to list their home. The prevailing belief seems to be that the real estate market "picks up" in the springtime, and thus, it is the best time to list one's home.

True. And false.

Yes, there is an up tick in activity in the springtime, particularly in the Midwest. Its warmer outside, there's no snow and ice to dodge, and home shoppers are happier to go from home to home, appointment to appointment, and open house to open house. Homeowners know this, and so they wait until the spring to list their home. After all, you don't want your listing to get "stale".

The problem? There's a deep inventory in Chicago now. There are many homeowners waiting until spring to put their home on the market. Unless there's a sudden boom in home purchases, there will be more homes on the market in the spring than there are now. There will be no sudden boom.

Prices are driven by the age-old battle between supply and demand. While the demand for homes may dip in the winter months, the supply will also dip. The ratio between supply and demand will be somewhat preserved. There will always be people buying and selling homes, even on the coldest day of the year. In the springtime, I believe that the combination of homes already on the market, and the new "spring chickens", will impact that balance between supply and demand. Time on market for homes will increase, and prices may hold steady, or even lag a little bit.

Other considerations:

• When it's nice outside, everyone is looking at open houses and eyeing homes for sale. When it's cold, only serious homebuyers are shopping. Separate the wheat from the chaff!

• Many corporate transfers occur at the beginning of the calendar year. If you wait for April or May to list, you will miss out.

• Your home looks nicer during the holiday season, doesn't it? More enticing? More home-like? That's what sells a home - looking like a home.

Don't wait for the influx of spring listings to compete with your place. List now. Sell now, and present potential homebuyers the best value in your price range.