Monday, February 25, 2008

Home Owners Want to Be Lied To...

...at least this is what I am finding out, and I don't understand why.

A few weeks ago I went on a listing appointment. I had already walked through the home, so I knew what needed to happen in order for the home to sell quickly. The owners asked me to be very honest about the condition of their home, and wanted me to be brutally honest. I don't sugar coat listings, so being completely upfront and blunt about their home was not a problem for me.

During the appointment, they wrote down all the things that needed to change to get top dollar for their home. Here are a few things I saw:


  • the fruit wallpaper in the kitchen had to go - replacing with neutral color paint updates the home and make it look more modern

  • the ceiling fan in the kitchen had to go - ceiling fans not only distract buyers when looking at a kitchen, they are usually ugly, and dated. No one puts ceiling fans in kitchens anymore, and buyers hate them.

  • the carpet needed to be replaced - the new carpet they told me about over the phone was in fact 10 years old and hadn't been cleaned in 10 years

  • the home needed to be painted inside and all child damages to walls fixed

  • the aromatherapy scent had to go

The sellers believed their home was a certain price, in its current condition. I told them that their home would not reach that price unless they changed the things I mentioned. They were comparing their home to other homes, that no appraiser would use as comparables. While the price that I told them to list at was $10,000 below what they had hoped, they said they understood and would fix the items on the list. Before the seller left, he asked me if it would be possible to list higher. I told him he could do anything he wants, but that I would be coming back to him in a month for a price reduction.

I thought things went well, but when a week passed of no returned phone calls or emails, I knew something was up. Finally I got the call that they were hiring another real estate agent to represent them. Through sources, I found out that the husband was offended and thought I had told him his home was crap.( If memory serves me right, he told me he wanted me to be brutally honest.) I also found out that the agent walked through his home, telling him:

  • his home was beautiful and not a thing needed to be changed

  • his home was worth $10,000 more than I told him - the magic number he wanted to hear

I guess what he really wanted was for me to lie to him, and give him a lot of fluff. Sorry, but that is just not my style. See, I believe that if you really want to sell your home, then you need to do things to set your home apart from all the other junk out there. Trust me, there are so many homes on the market that are average, that buyers find it hard to choose. So the only solution is to make your home look as good as it can. Painting is one of the cheapest ways to add value to your home. Removing anything that dates your home, like tacky wallpaper, or gold colored light fixtures, is a good thing, and relatively cheap to fix, too.

There are also a lot of desperate agents out there that will tell a seller anything they want to hear, just to get the listing. These are the mediocre agents that plague our industry. They will take an overpriced listing knowing full well that in a month, they will be asking for a price reduction. My question is, if the first month of a new listing is the most crucial time of the entire listing, why would you start by overpricing it?

Buyers, and their agents, KNOW when a home is overpriced, and instead of taking a look at it, they will pass it buy. Like I said, there are just too many homes for sale in the Twin Cities to choose from, so the easiest way to eliminate homes is to throw out those that are overpriced. Bottom line, if you want to be lied to, at least admit it to yourself before the listing appointment. And if you let the agent know as well, then you may not waste their time, by having unrealistic expectations.

9 comments:

Susan Gruenling said...

This is so true. I went on a listing presentation where the homeowners had bought when the market was high and then put in almost $100,000 worth of upgrades in the home. Unfortunately some of the upgrades were not modern choices or what many Buyers are looking for. I had brought a preliminary CMA with me to show them the recent activity in the subdivision. They became very irritated at me when I showed them that a home with the exact same floor plan in very good condition had sold for $80,000 less than what they thought their house was worth. They became very defensive and claimed that I did not appreciate their good taste and that I did not take into consideration the money they had spent. The numbers don't lie. I doubt that their house would even appraise close to what they hope to get.

Jennifer Kirby said...

Susan - sometimes I tell home owners to not shoot the messenger. As you say, the numbers do not lie. Many home owners over spent on remodeling efforts in their homes, and are angry to see that they cannot recoup the cost when they go to sell. I use the example of putting in a pool. While it might cost $30,000 to put a pool in, at sale time, most homes are lucky to gain $10,000 of that back.

North Georgia Lake Real Estate said...

The thing is they will know you were right in the long run as the house sits and is reduced in price and one by one they have to address many of issues you quoted.

I wouldn't feel bad you did your job and answered there question honestly.

Stapeliad said...

The 10 year old carpet that had never been cleaned is just...gross.

Jennifer Kirby said...

I had to chuckle a little when they told be it was brand new. I could tell by looking at it that it was fairly worn, and dirty.

Jennifer Kirby said...

I am glad I stood my ground and told them the truth. I know it is hard to swallow because I have been a seller before, and thought my choice of paint was nice. But once we moved out, and that color no longer matched the furniture, the color wasn't good to buyers. We had to change it to make the home look better. Sadly, this home will sit for months and lose valuable market time, not to mention they will end up taking less for the home.

Mike said...

Yes they do!

Great article J!
Congrats on the going undressed!

Kathy said...

"The truth! You can't handle the truth!" I can hear the passion of Jack Nicholson's tirade ringing in my ears during many presentations.

The nice thing about being able to shoot straight and speak with candor... I'll be sleeping soundly while they toss and turn with anxiety.

Fat Man said...

The wisdom of Gregory House, M.D. confirmed one more time.