5 Surprising Home Buyer turnoffs

The prospect of selling your home effectively makes you a marketer. And effective marketing requires that you understand the mind and priorities, likes and dislikes of your target buyer. In real estate, we all know that buyers like to see homes that are pristine, huge and well-located. Sometimes, though, it’s much harder to recognize when our own homes might actually be triggering buyers’ distaste - or disgust. 

Earlier this year, I gave you some critical insights into what specific things turn buyers off - and now I’m back with a handful more! Whether you’re preparing to sell your home, or you’re in the market to buy a home and want to be aware of what the property’s resale prospects might be, here are five home features and characteristics that are big-time turn-offs for today’s home buyers.

1.  Pools. Twenty years ago, having a pool was seen as a luxurious amenity - almost a status symbol that you had made it, if your home had one. Fast forward a couple of decades, though, and many home buyers are turning down homes specifically because they have a pool.

There are a couple of core buyer subgroups who love pools: people who live in places where summers are super hot and people who really like to swim. But those buyers are vastly outranked in number by these other subgroups: 

• people who know they won’t swim enough to use a pool, and think that maintaining one would just be a waste of their time, energy and money
• people who would rather have a yard, and are looking for homes in areas where they either have a pool or a backyard - but not both, and
• people who have young children and see a pool as a safety hazard.

If you happen to have a pool, your best bet is to market your home as best you can to those buyers who truly want one, and to mitigate the perceived negatives of pool ownership by being both pragmatic and creative:

• ensuring the pool has a well-functioning fence and cover, 
• staging the rest of the backyard in a way that maximizes the non-swimming activities a buyer will see as possible in the outdoor space, and/or 
• offering to pre-pay for a year of the buyer’s pool maintenance as an incentive of the home sale transaction.

2.  Your stuff.  Yes - your taste is immaculate. But it’s your taste. What buyers are really looking for when they come to view a home is a palate on which they can envision easily applying their tastes. Accordingly, a primary goal of smart home preparation is depersonalization or neutralization, simply removing most or all of the personalized touches that make your home reflect you unless they are also neutral enough that any buyer, from any age group or cultural background can step in and put their mind’s eye to work at filling in what the place would look like if they lived there.

That said, it’s also entirely possible that your things might not be as attractive, nice or tidy in the eyes of a buyer as you perceive them to be. In the same vein, the tchotchkes, knickknacks and memorabilia that you see as cozy and warm are highly likely to be seen by buyers as dumpy clutter. I have personally been in homes with a number of buyers where the fact that the sellers still had so much stuff or such bad stuff throughout the home distracted the buyers from appreciating the property’s true potential, and what it might be like if they simply made some cosmetic edits and redecorated.

We’ve talked a lot over the years about the idea of simply pre-packing, staging by boxing up everything but the very most basic daily essentials and get them ready to move - some sellers find that to be a much more effective way to think about the project of decluttering.  Also, you can reset your own perspective on what you need to get rid of or move out to put your home on the market by visiting professionally staged Open Houses, hiring a stager just for an hourlong consult or even asking your agent to walk through your home and stick mini-Post It notes on things that need to be moved out before the listing goes live.

3.  Carpet.  Obviously, old, dirty, pet-impacted and bizarrely colored carpets (red?!) are not a draw for buyers. But this generation of home buyers takes the carpet conundrum even further, exhibiting a distaste for carpet - period. Concerns about the relative difficulty and expense of cleaning carpets, to the cost of replacing them when you want a decor change, to the tendency of carpets to hold pet hair, mites and other allergens that may impact family members with respiratory issues are, collectively causing carpet to fall out of favor with today’s home buyers. 

The majority of home buyers express a desire to have hardwood floors in their next home; other hard floor surfaces, from bamboo to tile to concrete to cork, are rapidly outpacing the popularity of carpets (though some buyers do still prefer the softness and warmth of carpets in their bedrooms). 

If you were thinking about replacing your carpets before you put your home on the market, consider replacing at least the living and dining areas with hard wood or a similar finish.  And if your home has carpet over hardwood, talk with your agent about exploring the idea of ripping it up - it might not be as expensive to repair or refinish as you think, and in many areas, buyers prefer even an imperfect hardwood floor over nice carpets.

4.  Gold bathroom fixtures.  Gold bathroom fixtures are part of a larger category of buyer turn-offs perhaps best described as things that are old, but not old enough to be vintage, retro, classic or historic. As a general rule, this includes household appliances, finishes and decor that dates from the ‘70s and ‘80s, give or take a decade, depending on where you’re at. For instance, the popularity of Mad Men has driven a massive amount of interest in all things mid-century modern, bringing the 50’s and 60’s decor and design aesthetics that just seemed plain and old when I was a child back into vogue - but somewhat more in urban than suburban taste zeitgeists.  

This means that those goldenrod refrigerators and wallpapers with marigold, orange and avocado floral patterns are decidedly passe. Similarly, gold bathroom and lighting fixtures, popular in the 80s and 90s are seen as dated by buyers, who much prefer sleeker, matte-er stainless, brushed chrome and even bronze or white finishes where metal finishes are necessary.  Is this just another trend? Yes.  But replacing gold bathroom finishes and recessed lighting can covers is relatively inexpensive to do; touch base with your stager or agent regarding whether they think these micro-home improvements will make much of a difference with buyers in your area and your home’s price range.

5.  Elaborate gardens and/or vast landscaping.  A huge backyard seems like it’d be a big draw.  So do the flower and botanical gardens that the seller obviously spent hour upon hour designing and tending to. But they also seem like a lot of work to today’s time-strapped and cash-conscious buyers. Not long ago, a buyer I know actually de-prioritized a home they otherwise loved, because it was surrounded by an enormous Japanese garden, bonsais and all, that the buyer admired, but knew they could and would never be able to care for.  Same can go for elaborate, high-maintenance food gardens or even super-large front and backyards: some buyers simply know they don’t or won’t put the time, money and water into their care, so would rather not take them on.

Nothing about this should stop you from creating such an outdoor space if that is part and parcel of the lifestyle you want to live in your home. But it should be a factor you consider if you are concerned about reselling your home in the near future, and it might impact how you market your home if it has any of these sorts of features. If you have a miniature botanical garden at your home, why not find out if the local botanical garden or garden society has a newsletter you can place an ad in? If you have bees and chickens in the middle of Chicago or the heart of L.A., is there an urban farming club or blog that reaches that audience?  

Work with your agent to research where local buyers who would love your home’s unique or high-maintenance features, then market your home to them via publications, websites or organizations in which they already participate.  Once you understand that the average buyer might find these features to be less-than-desirable, it’s time to get creative about finding the buyer who will find them to be just what they’ve always wanted.

3 Most Attractive Buyer Incentives

In real estate when competition increases, listing marketers have to use every tool possible to standout. Every owner wants to attract the best buyers, so agents and owners often go beyond aggressive pricing to “sweeten the pot” for prospects with incentives.

The question is, “which buyer incentives are the most effective?”

Offering an incentive is a good idea, but only if you offer an incentive that can actually attract a buyer.  We want to give you the knowledge you need to offer the incentives

Here are the 3 most attractive buyer incentives that are most likely to be successful, according to the 2011 National Association of REALTORS Survey of Home Buyers and Seller:

1. Home Warranty Policies

The thing that is most attractive to buyers is a home warranty policy.  The good news is that this is also the most cost-effective incentive option for sellers, too.

Sellers can assure buyers that any unexpected repairs that fall under the warranty policy will be covered.  A home warranty typically costs only a few hundred dollars for the seller and can offer the buyer a tremendous amount of peace of mind.  There are a number of home warranty providers out there, so make sure you do your research to find the best provider for the home in question.

2. Assistance With Closing Costs

The economic and lending environments have created a situation in which many prospective buyers don’t have the cash required to cover their closing costs.  Many times, the difference between a buyer being able to buy a home or having to pass it up can lie in the closing costs.

Sellers who are willing to contribute to the closing costs stand a much greater chance of attracting a larger pool of buyers.  Sellers can decide how much they want to offer based on what makes financial sense for them and the prospective buyers.  While this might be a bit more costly option than the home warranty, it can be equally as effective in sealing a deal.

3. Remodeling/Repair Credit

If your listing has a feature or flaw that repels buyers, consider offering a credit towards repairs or remodeling.  If you are receiving feedback that buyers consistently don’t like a particular aspect of the floor plan or condition of a listing, then consider a credit.  This gives you and your client a way to overcome a potential objection right up front.  The more objections you can remove, the closer you get to a sale.

These  were the top 3 most attractive incentives in according to people who actually purchased homes in 2011. For more, download this great handout on attractive buyer incentives.

The next time you are trying to sweeten the pot for a prospective buyer, consider these options with your sellers.  These just might be the incentives you need to land that perfect buyer and close the deal.

Getting the "Just Right" list price

7 Tips for obtaining the "Just Right" list price for your home

1. The Comps. If pricing a home was about putting your heart’s deepest desire on some universal wish list, the world would be a very different place, my friends. But it’s not. And the first step to buying your ticket out of fantasy-land and into the realm of the price that will get your home sold is to narrow down the range of realistic pricing by looking at ‘the comps.’  ‘Comps’ is just industry shorthand for sales data on similar homes near yours which were recently listed and/or sold (“comparable” listings and sales).  

Ask your agent to provide you with your home’s comps; also, check them out by searching your address and general area for homes similar to yours, here on Trulia.  While you should view the actual sales prices (vs. list prices) of comps that have recently closed escrow as very informative and influential for your pricing decision, the list prices of homes that are lagging on the market can also help educate you about what price points buyers in your area see as too high.

2. DOM [Days on Market].  The MLS data your agent will provide with the comps and the listings you find here online should also contain information about how long the various listings in your market have been on the market. You can use this information - or your agent do the math for you - to get a gauge on what the average DOM, or Days on Market, is in your neighborhood.  

This empowers you to look at the comps with more nuance and to use them more strategically to influence your own pricing decision; you will ideally want to price your home in line with properties that went pending and/or sold in a time frame at or shorter than the average time homes in your area stay on the market. The homes that have lingered on much longer than that may be overpriced and may even require a list price reduction to sell; and that’s a club you don’t want to join.

3. List price vs. sale price. Here, LP stands for ‘list price’ and ‘SP’ stands for ‘sale price or ‘sold price.’  This comparison - sometimes expressed in a ratio, other times in terms of how many percentage points the sale price was over or under the asking price - gets at the difference, if any, between what sellers are asking for homes in your area vs. what buyers in your area are willing and able to pay.  When homes are selling for more than the asking price as a pattern or average, this usually suggests that your market is more of a seller’s market or that multiple offers are commonplace.  And the opposite is true - when homes typically sell for less than the list price, it indicates that buyers may have superior negotiating power.  

Work with your agent to do the math and to understand its implications for your own pricing decisions, as they are not always completely obvious. For example, your agent might be able to point out patterns you don’t automatically see, like the increasingly common one in which well-staged, vacant homes that are listed at a slight discount are the ones that typically sell for significantly over asking.

4.  Competition Level.  How many homes are competing with yours for the hearts, minds and wallets of qualified buyers? How has the number of competing homes on the market trended over time, recently? Many areas are reporting a massive decline in competition - less supply is good for sellers, but you need to know what’s going on in your area; don’t try to apply national headlines to your local, personal real estate decisions.

As you work to understand competition levels and their impact on your pricing, here’s what not to do: 

• Don’t just look up and down the street, or in your subdivision - also look at similar homes in nearby neighborhoods or even nearby towns that a buyer who likes what your home might also target.  
• And don’t just look at quantity - look at the quality, or nature of the competing listings. Is the competition mostly comprised of ‘regular’ equity sales, short sales or foreclosures/REOs? If you’re a regular sale in a sea of foreclosures, your price competition might be steep, but there may be other advantages of your listing that can offset that, to a degree.

So, what should you do? Get your agent to help you understand the competition level and the trends in number of listings on the market in recent months. Then, crash some of the competing listings’ Open Houses to scope out their condition and collect the rest of the intel listed here, before factoring it into your pricing decisions.

5.  Timing.  If your neighborhood’s award-winning school district or abundant colleges drive much of the buyer demand, you might be able to ask or get more for your home in June than in October, once the school year is in full swing.  If you live where it snows, listing it while it’s easy for buyers to get around might pay off, literally. There are a number of area-specific timing considerations that you may need to calculate into setting your just-right list price. Chances are good that you know what they are where you live, but your agent may have some novel insight on the matter, as well.

6.  Motivation Levels.  How motivated are you? Are you just testing out the market to see if you can hit a target number, or do you need to have escrow closed by a particular date to make your life and job plans run smoothly? What is your primary motivation?  Price, timing, closure, making sure your home passes into caring hands or just getting rid of a home or a mortgage that no longer serves you?  

And how motivated are buyers in your area?  From insights like:

• Average number of days on market
• Average list price vs. sale price
• Trends in comparable sales - their number and sales prices
• Trends in interest rates
• Trends in competition levels
• And insights like where you are in the seasonal changes that impact buyers in your area,

you can work with your listing agent to gauge whether buyers are so motivated that they will not be deterred by a premium list price, or whether you’ll need to use a discount or value-based price to churn up motivation in a market of fence-sitting buyers.

7.  Agent and Market Feedback.  So, you came up with a list price that you thought was ‘just-right,’ but you’ve had little or no Open House traffic or private showings. Or you got lots of showings, but no offers - or nothing but lowballs, anyway. It’s not too late to get to the ‘just-right’ list price for your home; in fact, time is of the essence if you want to take advantage of the swelling levels of buyer interest and activity that has sprung this Spring.

In many scenarios where a home lags on the market, the list price was set or maintained against the express advice of the listing agent, who urged the seller to list it lower. Or maybe you and your agent agreed on pricing early on, but they’ve been asking you for a price reduction for months now. If you trust your listing agent, and they have a strong background for getting homes in your area sold on today’s market, then it behooves you to at least take their pricing advice seriously, whether or not you follow it to the letter.  

If you need more data before you make the understandably scary move of cutting your list price, ask your agent to ask for feedback from the brokers and agents who have shown the property or attended Open Houses - or even to run the property past their own colleagues at their office or marketing meetings. Once you have this input - listen to it and factor it in, along with the other factors.

By:

Tara-Nicholle Nelson

May 31st, 2012

Housing Crisis to End in 2012 as Banks Loosen Credit Standards

Capital Economics expects the housing crisis to end this year, according to a report released Tuesday. One of the reasons: loosening credit.

The analytics firm notes the average credit score required to attain a mortgage loan is 700. While this is higher than scores required prior to the crisis, it is constant with requirements one year ago.

Additionally, a Fed Senior Loan Officer Survey found credit requirements in the fourth quarter were consistent with the past three quarters.

However, other market indicators point not just to a stabilization of mortgage lending standards, but also a loosening of credit availability.

Banks are now lending amounts up to 3.5 times borrower earnings. This is up from a low during the crisis of 3.2 times borrower earnings.

Banks are also loosening loan-to-value ratios (LTV), which Capital Economics denotes “the clearest sign yet of an improvement in mortgage credit conditions.”

In contrast to a low of 74 percent reached in mid-2010, banks are now lending at 82 percent LTV.

While credit conditions may have loosened slightly, some potential homebuyers are still struggling with credit requirements. In fact, Capital Economics points out that in November 8 percent of contract cancellations were the result of a potential buyer not qualifying for a loan.

Additionally, Capital Economics says “any improvement in credit conditions won’t be significant enough to generation actual house price gains,” and potential ramifications from the euro-zone pose a threat to future credit availability.

By: Krista Franks

01/24/2012

6 tips for selling in today's market | Inman News

6 tips for selling in today's market | Inman News

5 TIPS TO SELL YOUR HOME FOR TOP DOLLAR

Despite the market conditions, homes are still selling and some

homeowners have been able to successfully beat the odds and

sell for top dollar. To model the success of these savvy

homeowners, let's take a look at six tips to sell your home for top

dollar:

1. Price your home aggressively

Setting the right price for your home is the single most important decision you will make when you decide to sell. Go too high and you risk turning off every buyer in the marketplace, go too low and you leave money on the table. One simple but powerful technique for pricing your home aggressively is to spend the day looking at your competitors' homes. By doing so you will be seeing the world through the buyers' eyes. Be tough and honest with yourself. Compared to the competition what would be a price that would position your home as the best value proposition for buyers in your marketplace?

2. Hire an aggressive listing agent

Not all listing agents are created equal. To find an aggressive full time agent, take the time to research the market, talk to friends, neighbors, and colleagues about who they recommend, and interview multiple agents before making a hiring decision. Don’t hire an agent just because they tell you what you want to hear. Make sure your agent gives you a true picture about values in your marketplace, even if you don’t want to hear it. In addition, be sure to come to an agreement about a specific, documented marketing plan before signing a long term listing agreement.

3. Stage the home & use curb appeal

Buyers won't pull the trigger unless they become emotionally invested in your home. To help build a stronger first impression, start from the outside first by working hard to improve your home's curb appeal. Remove the weeds, plant fresh flowers and spruce up your exterior paint if needed. Next move inside and stage each space by creating a focal point and a story for each room. A set dining table, a book by the bed, or a game in the kids room are all simple examples of staging.

4. Offer incentives & pre-paids

A buyer who has narrowed their search down to two or three top choices may need a little push to motivate them to take action. To encourage buyers, many sellers offer incentives like buying the interest rate down on the purchaser's loan, paying for closing costs, inspections, or repairs, or providing allowances or credits for home upgrades after closing. In addition, many sellers prepay for services like internet services for a year, taxes, homeowners association dues, or even golf club memberships.

5. Get pre-inspections

Many sellers do pre-inspections of the home to provide buyers with a clear whole home inspection or pest and dry rot inspection. (A word of caution: anything discovered during a pre-inspection will likely need to be disclosed whether you fix the issue or not). It’s often easier and cheaper to do needed repairs in advance than trying to negotiate them later with an emotional buyer.

Contact me today for a free home evaluation

949realty.com

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