To compete effectively in today’s market requires research, knowledge, preparation and commitment. Am I talking about conducting an effective job search or selling your home?

If you said both, then you are corrrrrect! What experience can you take from a job interview or any interview for that matter and apply to getting your house sold?

• Preparation - the initial stages of a job search include doing some research on the company, and finding out as much as you can about the position. Selling your home includes meeting with real estate agents who will educate you on the market conditions and provide you with a cma and suggest a selling price. Most people who consider selling their home will also visit open houses in the area to compare the amenities of their home with other’s for sale.
• The interview -many job applicants will purchase a new suit and shine the shoe’s. Why? Because you have one opportunity to make a good first impression. The interviewer will call and tell you what time your interview will be. In addition, they are more than likely interviewing several potential candidates for the position. Selling the home is the same and home buyer’s are no different. They may look at ten houses in the same day. Make your house look as presentable as possible, add some potted plants for color and consider painting for freshness. Also, make the home available when a buyer wants to see it. Nothing turns people off more than a seller who is inflexible with showing the home.
• Present your qualifications - your opportunity to shine. Why do you feel your price and your value are worth more than the other applicant’s or the other houses on the market? Does your home offer a greater value? Have the systems been updated or are they in need of repair? Do you have a large lot or is the backyard small and close to the highway.
• The offer - your worth or market value as it relates to employment or property will be based upon how you handle the offer. Accept to little and live with less or ask to much and consider losing it. Personally, I do not think you should accept the first offer, as it leads to buyer’s remorse. A buyer will always think they paid too much and could have offered less. Accepting a good solid offer is based upon how well you performed and have met the three previous criteria. Negotiate from strength, not from weakness.

Gone are the days when you could put your house on the market and have several offers within the first two weeks. Also gone are the days of easy money, there must have been a correlation there. We can’t fret over the past, so what can you do to make sure your house is properly listed for sale?

1. A Thorough Analysis - chances are you do not have access to a bundle of market data other than what you may read in the newspaper. Your real estate agent does. A proper market review should look at the homes that are on the market in your neighborhood, and more importantly in your price range. There is no need to compare your $600,000 house with the one around the corner for $800,000. In this market homes in certain price ranges are selling better than others. What is the current inventory for homes competitively priced with yours and how many sold last month? This will give you an idea of how long it may take to sell your home and may affect your pricing decision.

2. Value Offered - in sales you’re taught to sell the “sizzle”, not the steak. What kind of “sizzle” does your house have? Here you look for things that create value, such as larger than normal lot size, updated kitchen and/or baths, central ac, fireplace, refinished hardwood floors, does the home have character, newer roof, updated plumbing and electrical. People will pay more for homes with greater value or amenities.

3. Property Condition - sometimes owners get used to living in their houses and begin to overlook and accept all of those little irritations that prospective Buyers may find annoying. First and foremost, make sure your home is clean and organized. I can’t stress this enough. A cluttered disorganized house makes people wonder what kind of neglect this house has endured for the past several years. It does not take a lot of effort to clean and maybe paint the front entry, mow the grass and place a few potted plants around the yard. Little things can make a huge difference.

4. Price it Properly - remember in the last article Aces High I discussed interviewing three real estate agents and being on the lookout for the one who quotes you the highest listing price. I have seen Sellers refuse offers that were below their asking price, only to have their house stay on the market for an extra 4-5 months. Now they are faced with a couple of price reductions and are chasing the market down. If they had only accepted the original offer, the house would be sold at a higher price than what it is still listed for today. Price it where properties are selling, not where the houses are listed for sale.

5. Develop a Strategy - accept the fact that if your house has been on the market for 45 - 60 days and you have not had a prospective Buyer visit your house in the last two weeks, you probably need to review where you are in the market. A price reduction is probably in order. Nobody anticipated the fall out from the sub-prime lending fiasco would be so severe. Sellers who made adjustments to market conditions have probably sold their house, while others continue to sit.

By utilizing these five recommendations in your efforts to sell your house, you should enjoy more success and reduce the mistakes others have made in the process.

The time has come to list your house “For Sale”. You have completed your punch list of things to do to prepare the house for sale, including a fresh coat of paint, some new landscape and fixing that annoying leaky faucet. Here is where we begin to hit critical mass. Do you look at your home from the eyes of a potential seller or a proud homeowner?

How you answer could cost you thousands of dollars.

I will go ahead and answer the question, you are the proud homeowner! You have worked hard to maintain your property and undoubtedly yours is much nicer than the one down the street that is for sale. How do I know this? It’s repeated quite often.

You consider yourself to be a savvy home seller. You have read various articles on the procedure, attended a few open houses and are now ready to hear why you should hire the neighborhood expert to sell your home. The newspaper articles recommend you speak to three real estate agents. You have an idea of what you think your house is worth and are hopeful that one of the prospective agents will confirm your belief.

What do most people look for when they speak with an agent?

They look for the one that will quote them the highest market price and convince them if they list with them, it’s a done deal.

What should you look for during a listing presentation?

1. Experience - How many homes has your agent sold? Can they explain the listing agreement to you, or explain the intricacies of the purchase agreement? Or do they rely on their Broker for all of their advice?

2. Don’t be romanced by the big name company - the agreement to sell your house is going to be dependent upon your agent’s own ability and motivation. Your agent will spend his or her own money to market the house, the company they work for will not spend a dime.

3. Justify - make the agent justify to you how they came up with the recommended price for your house. If the price is higher than most of the comps, why is your house worth this price?

4. How long will it take to sell - this can be a subjective answer, however there is data available to provide you with an answer. By looking at days on market or absorption rates, you can get an idea of what to expect.

Don’t choose the highest price by default.

I have seen home sellers sign a listing agreement for up to six months at an inflated price, only to have the agent recommend a price reduction four weeks into the agreement. It boils down to “tell em what they want to hear”. Anything to get your business.

In the next article we will look at different strategies available to you to sell your house.

In the first two parts of this story we looked at the contingencies a Buyer has once you have accepted an offer and your house enters escrow. As a Seller, what can you do to insure this contingency period goes smoothly, while eliminating any of the potential concerns a Buyer may have about completing the purchase?

The first thing you must do is detach yourself emotionally from your house. Easier said than done, right? Imagine you are in the market to purchase a home. What would somebody remenber after visiting your house? The National Association of Realtors did a survey on people who purchased a house and found that a potential Home Buyer will look at up to eight homes in a search that can last up to eleven weeks, before making an offer. Will yours stand out or easily be forgotten?

If there are little annoyances around the house that bother you, they should be corrected because they surely will irritate someone else. Some Home Sellers are opting to have their own home inspection, before the house hits the market. That way you can be alerted to any potential problems that might arise. The other side of this coin is that if an inspector were to find a problem or situation that needs to be corrected or demands additional investigation it should be disclosed, if not corrected, to a potential Buyer. It may then become a material fact, which you as a Seller do have an obligation to disclose. If it was corrected, I believe you should disclose the issue and what you did to rectify it.

Okay, now we have looked at our very own house through the eyes of a potential Buyer and we have corrected the items that needed repair. What else can we do?

I believe it’s best to plan for and address potential issues before they surface. As a Seller, you can write language into the counter offer that reduces the time a Buyer has for their Inspection Contingency from seventeen days to either seven or ten days. Another thought is to have language that completes the Home Inspection within five days, so that if the Buyer’s change their mind, you can get your home back on the market much more quickly.

Selling a home is like anything else, the better prepared you are, the better your chances for success. A painter doesn’t just go out and open a can of paint, and start painting. They sand the surface, patch holes, clean the excess debris, put a coat of primer on and then paint.

The goal is to get top dollar for your house, so you must take the appropriate steps to insure its success. Otherwise you will find that you have only one negotiating tool in your belt and that is the “Sales Price”. In that case you may be disappointed, simple because the price paid is reflective of the condition of the property.

Now we have progressed to the end of the seventeen day contingency period. What to do, what to do?

First a little review. The Residential Purchase Agreement developed by the California Association of Realtors states right there in black and white that the house is being sold in its PRESENT physical condition, meaning you (Seller) are under no obligation to make any repairs to the property. You do have a responsibility to maintain the property in the present condition as it was on the date of acceptance.

The Buyers have presented you with a list of items that need correcting. Usually these come from a recap page in which the Home Inspector summarizes all of the issues they have with the house. Understand that Home Inspectors are paid to find problems and no matter how insignificant the problem may seem, it will probably make the list. Also many homes here in Pasadena are eighty years old or more. Many have deferred maintenance and will surely require repairs. Condominiums and townhomes usually have fewer problems because they are newer construction and there is no access under the structure or in the attic. Inspectors cannot inspect what they cannot see.

When the Buyer presents a “Request for Repair”, you have a few options. Option #1 is to fix nothing. Option #2 is to fix everything. Option #3 is to fix some of the items and Option #4 is to provide a credit issued at the close of escrow in lieu of repairs.

Depending upon the request, most Buyers and Sellers usually agree to meet in the middle and fix some of the negotiated items. Usually these are minor issues and can sometimes be handled much easier with an offsetting credit. Why a credit instead of the actual repair? People’s perception of how an item may be fixed or corrected can easily be disputed. If actual repairs are to be made they should be performed by a licensed contractor and should provide a receipt and a warranty. Credits on the other hand cannot be disputed.

If both parties fail to reach an agreement, the Buyer can usually cancel the purchase contract and typically the Seller has to refund the good faith deposit. If this happens, you reset the clock and start over, so it’s always in everyone’s best interest to try and reach an agreement.

In my opinion the purpose of the repair list is not to make the house new again, but to address faulty or safety related issues. Most request’s are reasonable, but I have seen the Buyer ask the Seller to install all new plumbing at a cost of $3500. Much of what happens will be dependent upon the specific situation. How long has the house been listed for sale? What price did the parties agree to?

Of all the Buyer contingencies we discussed in part one, the Inspection Contingency can be the most difficult to overcome. The reason is money. A potential purchaser may weigh all the costs of buying the house along with the changes they would like to make and decide that they are spending more than planned.

In part 3, we will look at ways Sellers can insure their home inspections precede more smoothly. We will also examine opportunities to possibly reduce the number of days a Buyer has for an inspection.

Your house has been for sale now going on 60 days along with many other houses here in Pasadena and you just accepted an offer. Congratulations, time to start packing all those personal items, right?

You might wait a few days before making that trip to the box store and here’s why. When a Seller places a home on the market “For Sale”, they are 100% committed to sell it (most of the time, I have seen some exceptions). When a Buyer has a purchase contract accepted they are usually 50% committed to buy it. Notice a disparity here?

Our purchase agreement drafted by the California Association of Realtors provides for a seventeen day contingency period. Contingencies are provided to the Buyer for a number of issues including obtaining a loan, appraisal of the property, investigation of the condition along with insurability, other reports and disclosures made by the Seller or ordered from a third party, the preliminary Title Report, common interest or HOA documents and maybe even the sale of the Buyers property. This is the time in which a Buyer has to perform their due diligence. Home Buyers should be using this time effectively by obtaining as much information as they can about the property and its condition. If they plan to make repairs or changes, now is also a good time to be obtaining quotes from contractors.

When I mention this to FSBO’s they look at me and say “Huh”? A purchase agreement is a complex document involving hundreds of thousands of dollars, and unless you do it everyday you just don’t know what you don’t know.

During this seventeen day period, most Buyers will pay for a Professional Home Inspection, we strongly recommend it and most agents I know highly encourage it. These usually cost in the neighborhood of $250 to $500 depending on the size of the property and the scope of the inspection. This is analogous to going to your family doctor for a check up. If they feel anything warrants further investigation, they will refer you to a specialist. A Home Inspector will refer you to a plumber, electrician, soils engineer, fireplace specialist, etc., if they feel some area of the house warrants further investigation.

It’s been a short or long seventeen days depending on your outlook and now its time for the Buyers to make their decision. Do they go forward with the purchase or have they discovered something in their inspection process that may make them change their mind? After all, that word contingency means 50/50, maybe they will, maybe they won’t, who knows?

In the next installment of this story, we will take a look at how this ongoing saga can come to a conclusion. We will also look at ways a Seller can reduce this contingency period and their resulting anxiety.