There are a few things that stand out for me in this project. They are:
- The importance of a good process
- The importance of a good team to implement that process
- Standing firm on price when appropriate, and
- The importance of managing the appraisers visit
As I left this property after meeting with Angie and James about listing it, I called my wife, who calmly said toward the end of our call: “Well, I think it is going to happen tonight.” It was the birth of our son, Tommy. It turned out that he wasn’t born until the next day, but…Holly’s labor sure happened that night. Thankfully, I have a process, and a great team to support me, so we were able to get the property listed and enjoyed great success.
We had considered listing at $1,400,000 based on other local inventory, but decided to push the number based on the premium we felt the home deserved. We considered lowering the price at two weeks on the market (the sellers had their own infant at home so showings were inconvenient, and also wanted the proceeds for a home they were under contract to purchase), but decided to hold the line on price, as we still believed in the value. We soon heard of one offer coming, and were able to use that offer to encourage another party to get off the fence which…encouraged that first party to make their offer better.
We sold at $1,665,000 and created what I call “an appraisal problem.” It is a goal of mine to create this dynamic whenever I represent sellers; a house that is under contract for more than the appraiser is likely to see the value for. I met the appraiser at the house with my version of the “comps” for the property. She pointed out that the actual square footage of the home – per her calculations – was less than the city record. I argued that that it didn’t matter; that the quality of the property stood firm, and shared an example of a smaller-sized home that had recently sold at a similar price (across town). The appraiser agreed and the sale closed. The family moved closer to their extended family and we all smiled.
View listing details here.
This project was a study in:
- Exercising restraint until the "right" time
- The importance of pre-inspection
- The importance of great staging
- The importance of great photography
- The importance of my getting in front of the buyer when possible to establish trust (for them) and to see first-hand their motivation (for my clients)
- Picking the right Buyer's Agent
This project was at first interesting in that we could have listed it for sale a month or so before we did. The owners had the ability to hold it until the right time, though, so we used that to our advantage and used the extra time to button up maintenance items that came out of the pre-inspection, get the home staged and then adjust the staging, have good photographs taken and then take a few more. The Sellers were not excited about the items that came up on pre-inspection (before listing) but having the inspection proved to be of great value. Not only were they able to get some maintenance items out of the way that buyers would have seen as important, but they were able to demonstrate to buyers that they knew the condition of the home (very good over-all) and had priced it with full knowledge.
The staging was good when first installed, but we made some tweaks to it before photography. One challenge with stagers is that they often use what they have. The Sellers and I felt that this home needed a “significant” dining room table in order to fit with the architectural design of the home, and also to show that home as one that would accommodate a family. We knew we were fighting a bit of a battle on this one, as many young families prefer at least three bedrooms on one level (one for the parents and the others for kids) and the house simply didn’t offer that.
Once the staging was perfect, we shot good photographs in good weather. There were a few angles that we then thought should be re-shot, so we did. It was nice to have the time to merchandize and market correctly. We held a few open houses, and everyone in the neighborhood showed up. I was personally able to spend a few moments with one of the eventual Buyers; this was important – I believe – as he needed to trust me later in order to get across the line.
On offer review day, the importance of the pre-inspection was reinforced when I had a prospective buyer ask me to see the report and then made an offer not subject to inspection based upon what they saw. More offers normally means a higher price, and this case was no different. We had a priced at a number that the Sellers would have been happy with, but were able to push that number, and our confidence in closing at that number. The Sellers chose the offer they wanted to work with, and we were able to make it better by having the buyer’s agent ask her clients if they would waive their financing protections. They did.
When we met the appraiser, we were sure to show the appraiser all of our offers, and to indicate how completely the Buyers wanted this house. The appraisal came in “at value,” the Buyers arrived in town and all were happy.
View listing details here.
- Listing "vacant"
- Encouraging agents/buyers to "Play their own game."
- Good photos
- Good presence at open house
- Keeping good rapport with second position agent/buyer
This was another great example of perfect timing. The owners used the winter months to get the home pre-inspected and work through the resulting punch list. They hired a good inspector with a good reputation, so the inspector’s report was considered credible by buyers agents and buyers. We were able to take photos (day and dusk) when the light was good, and had them on-hand for a nice stretch of weather. The home was technically still occupied by the sellers, but they had the ability to stay elsewhere during that period of good weather, so we listed the home as vacant.
Buyers were able to come and go with their agents (and possibility their inspectors). The long periods of time alone in the home without having to worry about the sellers return helped a few sets of hopeful buyers to form emotional bonds with the home and to imagine what their lives there would be like. When agents asked me how many pre-inspections we had, I was able to tell them that I honestly did not know. This is important, because sometimes Buyers lose interest when they hear that too many other parties are interested.
View listing details here.
The market was in a state of transition (from buyer’s market to seller’s market) at the time we listed, and I was interested to re-discover that one of the reasons to have a good agent host at open houses is to make sure that some conversations stop. At one open house, a couple agents got together and started a conversation in front of buyers about how they thought the market was over-priced. While they have a right to their opinions, I had a right to encourage them to move it along, so I did (the market has appreciate at least 10%, probably 15% or 20% for this house since that time).
This was another “appraisal challenge.” I met the appraiser with my best comparables, and tried everything I could to get him to see the value at our $1,001,000 list price, but…I finally “lost” one and the appraisal came back at $950,000. But I don’t like losing, so I told the buyers agent that another buyer had been sad that they didn’t control the purchase, and would likely pay her clients contract price, but without the protections of an appraisal contingency (or financing addendum at all, for that matter). She and her clients countered that the seller and buyer should “meet halfway” at $975,000. The sellers were ready to agree to that number, but I believed that the buyers could both afford the home and wanted it badly enough to pay their price. And, I believed that the second position buyers would do the same, so I encouraged the second position buyer’s agent to get me an offer for $1,000,000 without financing or appraisal contingencies. He did. I then told the first buyer’s agent that we had what we thought we had, and that we respected her client’s position should they prefer to get out of the contract based on appraisal, but that the home would sell to someone else for $1,000,000. The first position buyers came up with the additional down payment to satisfy their lenders and their low appraisal, and they closed on the house at $1,001,000.