Archives

April 2007

Open Houses

Posted at 1:48 PM, Apr. 30, 2007

Should we Hold an Open House

When you are selling your home as a For Sale by Owner (FSBO) you will almost certainly hold open houses. However, there is much controversy amongst sellers and even real estate agents on whether to hold open houses or not. Here are a few things to consider;

1. Where is the home located -- Is your home located on a main road where lots of road traffic passes by each day. Then an open house may be worth it. However, if your home is in a gated community or located on a dead-end it may not command enough drive-by activity to make it worthwhile. An open house on a road where 35,000 cars pass by each day will be more successful than one where the only cars that pass by are the neighbors.

2. Security -- Beside the looky-loos, neighbors, and those interested in getting decorating tips, one group that likes open houses are thieves. Although not all that common, crime and assaults do occur from time to time. The crime is often the stealing of jewelry or prescription drugs. Whether you are a FSBO or Realtor an open house is an open invitation for everyone to come in, and you cannot control whether they are potential buyers or those that may be planning something more nefarious.

3. Cost -- Anyone can put out a sign, but properly advertising an open house can run $80 to $200 or more for each open house. These costs can add up quickly.

4. Housing Market -- In a sellers market the chance of selling is high as buyers are desperate to find a home. They often go to a Realtor, look for open houses and FSBO homes. In a normal market about less buyers look for open houses, and in a buyers market, most buyers go through a Realtor as there are too many homes available. Therefore, there is little benefit to an open house in a buyers market, limited benefit in a normal market, and good benefit in a sellers market.

5. Is your home the best priced, or in the best condition -- Sometimes those looking at open houses are not yet serious buyers, however if the home is so much better than others and the price is great, the looker can turn into a serious buyer. This requires a home in perfect condition or priced lower than the competition.

6. Success Rates -- Open Houses are successful approximately 1% of the time. On average for every 100 people that go through an open house 1 person will purchase. In a sellers market, 100 buyers may go through an open house in a few weeks. In a buyers market it could take many months or even years of weekly open houses to sell the home.

The decision on whether to hold open houses should be thought through carefully and discussed with a real estate professional. For a well-priced home in a high-traffic area they can be a great idea. For other homes they can be costly and of little benefit.

Selling Your Home In Any Market

Posted at 1:00 PM, Apr. 22, 2007

  Selling Your Home in Any Market 

I am often asked by sellers "what do we need to do to get our home sold." The answer is the same whether it is a sellers market, normal market or buyers market. The timeframes may change and the approaches may change, but in all markets there are three main factors involved in getting your home sold.

These three factors include Price, Product and Promotion.  I will briefly cover each of these, however if you would like more information, please email me at Info@SweetHomeTampa.com or even better; call me anytime at 813-469-3163. 

Price: Price in many peoples thinking is the most important, in that if the price is right, there will be a buyer. However, selling your home goes much more smoothly and gets the highest price when all three factors are in balance. 

In a sellers market such as the one we had in 2005 pricing is not quite as important. If a seller overpriced their home the prices caught up within a couple of months and sometimes much less. However in the buyers market we had in 2006 and continue to have in 2007 overpricing by even $10,000 can be disastrous. A quick example will help.  

Joe and Sally seller are ready to put their home on the market. The Market Analysis or Appraisal shows a value of $280,000 so Joe and Sally seller decide to ask $290,000 to allow room for negotiation. The problem is that there are seven other comparable homes for sale in the same subdivision and three of them have asking prices below yours. The lowest is priced at $282,000. You decide you will try for $290,000 for 30 days anyway. At the end of 30 days after few or no showings you decide that you will now drop the price to $280,000. The problem now is that some of the other comparable homes have dropped their price already. One is priced at $270,000. So now you are overpriced again. Many sellers are facing this problem today, and are always running one price reduction away from selling their home. Unfortunately, each time they lower their price, they are always playing catch-up and always one price reduction away from selling.  

There are many homes on the market today that have been on the market for a year or more that if they priced the home correctly at the beginning would have sold their home for say $50,000 more than what their asking price is today.  

Product: The product is the home, land, and everything included in the sale. That is to say it is the condition of the home and how the home looks to potential buyers. All else being equal the home in the best condition will sell first.  

There is often a debate on whether it is better to repaint or install new carpet if necessary or to give an allowance or just to lower the price. My advice is always to do the repairs that are needed. Buyers almost always overestimate the cost of carpet or painting. For example the cost or repainting may be $2,000 but the buyer thinks it will cost $5,000 or more and takes that amount off their offer. Also many buyers truly want move-in condition. They do not want to delay their move just to have the home repainted or to get new carpet installed. Therefore, they will often look for a home that does not require repairs. They will not even make an offer on the one that requires work. 

To look the best to buyers, you should make the yard and the outside of the home look great (curb appeal), and the inside of the home should look clean, neat and without clutter. Kitchens and bathrooms should be especially clean. 

Promotion: Promotion is also known by the name marketing or advertising. The thing to realize is that there are various ways to market a home, and these marketing methods must be individualized to the particular property. Some marketing methods follow. 

For Sale Sign: Is used to attract the buyer that might be driving by. Most effective where there is much traffic going by. Least effective is on dead-end streets and in gated communities. 

MLS: The multiple listing service is probably the most effective marketing technique and the least understood. It is not just being on the MLS that is important, it is using it effectively. The MLS is used to market to both Realtors and Buyers. Used effectively it makes Realtors want to show your home first, and makes buyers want to see your home most. Effective use includes the use of the maximum number of photos, virtual tours, excellent property descriptions, and the use of incentives. 

Realtor.com: 82% of buyers start their search online. The majority of these start that search at Realtor.com. When you think of Realtor.com it is best to think of a magazine. If you were to advertise in a magazine you would probably like you ad to be on the cover if possible. If not then within the first several pages, and as you can imagine the further back in the magazine then the less your ad would be seen. The same is true on Realtor.com. When a Realtor joins the National Association of Realtors included in their membership is their listings appear on Realtor.com. However, you only get a standard listing on Realtor.com. 85% of Realtors use standard listings as there is no additional charge. However this is like having your home advertised in the back of a magazine. On Realtor.com this puts your listing last, only shows one photo and only has the Real Estate offices contact number. There are then several levels of enhancements which the Realtor must pay for, sometimes with a cost of several thousand dollars per year. 

Open Houses: Results in sales approximately 1% of the time. Most effective on busy streets, least effective the further into a subdivision, dead-end streets, or in gated communities. 

Newspaper Ads: The least effective marketing method and the most costly. Ads can run $80 per weekend for local papers and as much as $280 per day in the New York Times.  Serious buyers go to Realtors or shop online. 

Home Magazines: Costly, but effective in certain market conditions. As high as $500 per month or more. Not very effective in a buyers market. Again serious buyers go to Realtors.

In closing, when selling a home, it is important to have the three P’s in balance. Again these are the Price, Product (condition of the home), and Promotion (marketing). If one factor is out of balance another factor must compensate. For example, if the condition of the home is inferior, then the price might need to be lowered. If there is not enough marketing, the price may need to be lowered or the curb appeal might need to be raised. Sometimes if one is too far out of balance, the others cannot be made to balance the other. For example, if the asking price is way too high, making the home even nicer, or all the marketing in the world will not sell the home.

Westbrook Estates Market Report for the First Quarter of 2007

Posted at 11:27 AM, Apr. 8, 2007

Westbrook Estates Market Report

Please click the link below to open the first quarter market report for Westbrook Estates in Wesley Chapel, Florida. It lists all the homes currently listed, under contract, sold or expired during the period of January 1, 2007 through April 8, 2007. It is in PDF format so you can print it out or save it to your computer.

Westbrook Estates First Quarter 2007 Market Report

Wesley Chapel to Get Pasco National Tennis Center

Posted at 3:19 PM, Apr. 4, 2007

Old Pasco Road to Close Soon

Posted at 12:48 PM, Apr. 4, 2007

Old Pasco Road at the intersection of CR-54 should be closing soon for grading and paving. The construction will raise the road level by approximately three feet. Nelson Construction had asked County Commissioners to approve closing the road starting March 29th; however that date has already passed. However, do not be surprised if you suddenly see a detour.

The road closure will require a detour of traffic onto Oakley Blvd. The road closure is expected to last approximately three to four weeks.

Road Work and Progress Parkway Entrance

Posted at 12:39 PM, Apr. 4, 2007

According to the road crew doing the construction of Wesley Chapel Blvd the entrance to Progress Parkway should be reopened within one to two weeks.

I'm sure we are all looking forward to that!

The road work to follow will be to install a grass median along with two westbound lanes. Until then the newly paved road will be one lane in each direction. It will be a nice treat when we have four lanes on Wesley Chapel Boulevard.

They state there will also be room left for an additional two lanes to accomodate future growth.

Home Down Payment Gift

Posted at 12:33 PM, Apr. 4, 2007

U.S. Rep. Dave Weldon Republican of Florida is going to introduce legislation that if passed would allow relatives to give a gift equal to 20% of the down payment of a home, as long as the price of the home is no more than 110% of the local median price.

This would be a big boost especially to the first-time homebuyer market. Although the real estate market is slowly beginning to rebound, this would be a nice incentive to help increase homeownership.

Gate Or Not To Gate

Posted at 3:05 PM, Apr. 1, 2007

Many residents here at Westbrook Estates have in the past brought up the idea of having a gated community only to hear that it is not feasible. Lennar Homes for almost 12 years has sold homes in Grand Oaks, which is about a mile away as a gated community. Last year they installed the gates and a guard’s station. They felt that the residents would love to live in a gated community. However, only 42% of the residents voted for a gated community. It would take a vote of 80% of the residents to allow the county to convert the roads from public to private.

Why would the residents not want to live in a gated community?  It has to do with finances. Many residents like the idea of a gated community, but just do not want to pay for it. Once the roads become private the community is responsible for maintenance of the roads and gates, along with being responsible for accidents and injuries. Therefore it takes much of the cost of road maintenance and other costs away from the county and puts it on the community.

The board in Grand Oaks has even gone so far as to insist that Lennar Homes remove the guard house and the gates, and restore the entrance to its original look. The board felt that the issue has been extremely divisive. Although not specified, another likely reason could be the fact that even though they would not be allowed to use the gates or guard station they would still have to maintain them.