The 4 P’s of Real Estate

Welcome to the world of high tech, high expectations and high demand

We live in a high speed and heavily connected world where there are almost no uneducated buyers anymore.  You can’t fool anyone.  There is so much information out there that everyone is aware of the market, and HGTV house flipping shows make even the least educated people think they are experts on how it all works.

I’d venture to say the average person doesn’t understand the level of detail required to bring a property to market. And the lead time required to introduce a property in an efficient and effective way that meets the demand of today’s internet savvy shoppers and buyers.

Preparation

STEP 1: DECLUTTER

Clean and well organized houses appeal to the masses.  As an optimist, I’m going to assume I will get the property sold immediately.  And, since a client is going to have to pack at some point anyway, there’s no time like the present to get started.  I advise clients to pick up a bunch of sturdy bins and get to work!  Seasonal clothes and holiday decorations should be packed up and stored out of sight (offsite is even better).  This minimizes clutter and also gives the perception that the house has plenty of storage and closet space.  The house will appear spacious and open, especially important in creating powerful photos and optimizing the showing experience.

Now that a lot of the packing is done, the house is tidy and less cramped, and a lot of the heavy lifting is out of the way. Time to call the stager!  Today, every home that is listed for sale should be staged to some degree. A home must show like a model in order to stand out against the competition.

STEP 2: STAGING

When a person moves into a new house, it’s fun to decorate to their tastes and preferences and favorite colors.  But when selling a house, it’s important to neutralize the environment and stage it in a way that appeals to the masses and doesn’t distract from the best features of the house. Often times this entails re-painting walls, rearranging furniture and storing away your favorite collection of dolls.  Not everyone loves the color purple or animal print wallpaper, so sellers need to get to work well in advance of when they want their property to hit the market.

STEP 3: TEND TO REPAIRS

By law, sellers must disclose existing structural and mechanical problems, past flooding, any knowledge of lead paint and radon hazards, and any other known defects to potential buyers. Withholding this information can have much more serious repercussions than the problem itself. So, sellers…is anything broken and has the necessary annual maintenance been completed on the mechanics in the house? Does the bathroom sink leak? Is the sump pump working well and is it reliable?

Seller must tend to the repairs ahead of listing because rest assured, the buyer will hire an inspector to look for and identify all defects on their behalf.  When found during the inspection, the buyer will ask for the repair to be made, request a credit to repair (using an estimate from the highest paid repair person in town), or they could walk away from the deal all together. Sellers can put themselves in the best position possible by making the repairs in advance of listing the property.

STEP 4: DEPERSONALIZE

Some clients struggle to take down pictures of all the kids, grandkids and cats, but potential buyers want to feel like this could be their house.  It’s always best to depersonalize by removing unique collections, photos and sports memorabilia that may be distracting. Potential buyers don’t want to picture the seller in the house – they want to see themselves there! When people can picture themselves living in the house, they are more likely to put in an offer quickly.

STEP 5: DON’T FORGET THE OUTSIDE

The very first photo in the MLS is of the exterior of the property.  And when people pull up for their first showing, we don’t want them to drive away before walking through the house. Sellers should work on the curb appeal by having a landscaping company complete a yard clean-up that includes weeding flower beds, adding fresh mulch, trimming bushes and trees, and edging. Clean out those gutters!  Add some pops of colors with a seasonal (but tasteful) wreath and some potted plants.  They can make the yard or front porch even more inviting by adding an Adirondack chair. When the outside of the house looks inviting, people will be eager to see what’s inside!

STEP 6: DEEP CLEAN AND KEEP IT THAT WAY

The house needs to be cleaner than it’s ever been, just ahead of listing photos. Sellers need to give their house a deep clean from top
to bottom, including windows, upholstery and carpet, and the refrigerator and oven. They need to focus on the details, like changing out all the light bulbs. Wiping down surfaces and picking up the house each evening ensures the house will shine for any showings that come up the next day.

Price

All homeowners wish for appreciation and profit during their home sale, but that’s not always the case.  Pricing trends are hyper-local and much of the formula has to do with how the property stacks up against the current competition paired with current demand for specific neighborhoods and school districts.

While renovations can help add value to a property and may help a house sell faster, sellers shouldn’t automatically assume that all costs will be recouped.  The National Association of REALTORS 2017 Remodeling Impact Report shows that sellers see a 64% return for every dollar spent on improvements, on average.

No homeowner wants to leave money on the table, but starting with an unrealistic or overly-ambitious asking price isn’t the way to achieve the highest possible sales price for a property. Pricing a home correctly right out of the gate is critical to a successful sale that produces shorter market times and higher selling prices.

Real Estate Brokers look at current competition, recently sold properties in the same area, supply and demand, market times, interest rates and economic projections, seasonality, location, property features and condition, updates, upgrades, lot size and views. All these variables come together in a Comparative Market Analysis that evaluates where to set the listing price.

The house is never as exciting as during the first two weeks on market. This is when we see the greatest amount of showing activity, along with the most serious buyers who are ready to act with a sense of urgency. As the weeks pass, interest wanes and longer market times fuel the perception that the house is somehow flawed, driving the value down. Time is money, and the best way to optimize both is to set an accurate listing price from the start that will attract the right buyer.

Promote

They say a picture’s worth a thousand words, but did you know that one minute of video is equal to 1.8 million words? By 2020, videos are expected to make up more than 80% of all online consumer traffic! *

The majority, if not all, buyers begin their home search on the internet. Therefore, a digital marketing strategy is critical to driving maximum exposure for a property hitting the market. Today’s savvy buyers first view a property online, then decide if they actually want to make the effort to visit the property and walk the halls.  Professional photography, video tours and floor plans make the process more efficient and allow buyers to understand the property before they arrive. Videos highlight amenities, updates, upgrades and flow, all while sharing the story about the house, lifestyle and neighborhood. These digital components are then shared across various social platforms like Facebook, Instagram and YouTube.

It’s not enough to simply put a property in the MLS and hope someone buys it.  Effective Realtors proactively promote and drive exposure, to the most viable buyers, to enable sellers to reach their goals.

Protect

A real estate transaction is a fluid process that doesn’t end with an accepted offer.

Realtors are experts who can help navigate the process, anticipate issues, vet buyers, hold deals together and keep things moving towards the closing table.  When representing the seller, the Realtor is protecting and defending the sale price to ensure the seller gets maximum value on their investment.  When representing the buyer, the Realtor is making sure the buyer doesn’t overpay for the property or inherit serious defects.

Realtors play a critical role in negotiating price, mortgage contingencies and terms, home inspection items that need resolution, closing dates and contract modifications. They manage multiple players to include the buyer and seller, the other Realtor, two brokerages, the loan officer, underwriters, the inspector, two attorneys, and the appraiser.

Sometimes it can take months to find the perfect house for a buyer, or to sell a listed property.  Then another two months to negotiate and manage the deal to closing.  There are hundreds of opportunities for a deal to go south and a Realtor doesn’t get paid a penny until after the deal closes.

Selling a home is financially driven but emotionally charged.  When a homeowner finally commits to selling, they want it over with quickly and without any major headaches.  This is where a Real Estate Broker truly earns their commission and hopefully, their client’s trust. Bringing a property to market requires incredible detail and organization.  Selling, managing and closing the deal requires a level-headed and relationship-focused Realtor advocate looking out for sellers and buyers.

*Carrie Little, MRED trainer

Content provided by Women Belong member Dawn Sullivan