This little extra consideration when preparing a home....A Welcome Letter

Once the seller has prepared the property for market, there is still one very important thing you can do that will make a big difference in the the co-operating agents' and their Buyers experience of the property.

I prepare a Welcome Letter in larger than normal print size that covers some of the important features in or about the home as well as invites the Buyer's ( As Guests) to enjoy their home and provides a few extra things that will be welcome.

This Welcome Letter is put on a cleared table or console at the entry so it is not missed. The letter is mounted on a stand-up card backing next to the property Brochure.

This table is important as the Agent and Guests (as the Buyers will be referred to) are invited to lay keys, notebooks, papers on it while they tour the home. If the home is a " Remove shoes " residence,  shoe covers are also there along with a chair sitting along side the table to assist the Agent and the guests be comfortable.

The Letter is all important because it covers so many really important things. It invites the Guests and Agent to use the Guest Facilities if needed and to find beverages ( iced tee, colas and water) in the refrigerator. On the table is also placed a bowl of candies ( individually wrapped chocolates or mints) for the Sellers guests. Comment cards and a nice pen are also placed there inviting comments on the home. Many of these things when not spoken about can create awkward moments. By giving permission in advance the Guests and Agent always feel more comfortable.

This letter also has special instructions about details in the house that the Seller wants to remind the REALTOR  or Guests about. An example of that is to leave the lights and music on, to be careful on the steps ( up and down ) and lock all exit doors, turn off ceiling fans, etc.

In the Powder Room or Guest Bath , whichever one is to be used, special hand towels and soaps are provided with a note that they are there for the guests. This clears up the mystery of wondering if these items are OK to use.

If there are items that don't convey such as a favorite light fixture or heirloom , they can be pointed out.

Throughout the home, special cards are attached to items that might be conveyed, such as built-in bookcases, vanities , etc.

On the inside of the front Entrance Door. a THANK YOU for visiting the seller's home, signed in the owners handwriting. This personalized way of directing the showing makes the Agent and Guests feel welcome. It also goes a long way to  make the Guests and Agent feel welcome and respected.

The Comment Cards title is " YOUR COMMENTS are WELCOME and APPRECIATED".

What makes for a winning marketing plan and who is in control of it?

It is time to sell the old place and you are interviewing local REALTORS hoping to hear that your home will fetch a "pie in the sky"  price.

Doubtful that will happen but let's take a look at why you might have that expectation.

The agent wants the listing and most will tell you the market today is more normal ( level pricing with lower appreciation). You will be informed that prices have adjusted downward from the lofty exaggerated prices of a couple of years ago. The agent will also show and explain their great marketing plan and as you will notice, they will be doing a lot of advertising and ultimately have to accept that too high of price you forced on them. So the process begins.

1st weeks open house, ads in the newspaper, brochure box on the sign post, nice property brochure and the end of the first week results, No offers. The agent said it will take a while, so the request for patience is to be expected.

What's wrong with this picture? Perhaps in your mind, nothing. In my mind, it is very wrong and it all started with the marketing plan the agent presented to you that you have to great of an influence on. Setting the Price.

The Just Listed mailing will be sent to families that own a home in the neighborhood just like yours. Do you honestly believe that the neighbors want two homes or will sell theirs to buy yours? Do you believe that they have friends that want to live next door or down the street> Doubtful. Brokerages have been training their agents to send out the Just Listed announcements for years. Why?  In hopes  that neighbors will see that you selected firm if a neighbor is going to sell soon that they should select their firm as well. Great for the agent and company, not that beneficial for you the seller.

The ad in the newspaper was not put there to sell your home. It is there to get the phone to ring and hopefully attract a qualified buyer or seller prospect ( not to sell your home however).

The property brochure box will be full for the neighborhood kids to take and throw all over the place or to attract drive bys from looky loos will likely not sell your home either. If they are serious buyers they are already working with an agent and should not be discovering your home for the first time from the flyer. If the home is within the right search parameters for the buyer, they should have already received the information on the property. The property brochure is useful but likely isn't going to sell the property. I am not going to dissect all the elements of a possible marketing plan and counter each one. The point being that most things done in a marketing plan are  useful for something or someone but can they create the desired result of selling your home? Not in and of themselves, no.

So exactly what is it in the agents marketing plan that is going to "sell" your home? For starters being in the MLS and generating a strong local market and Internet presence for your home is good. Exposing the home to the likely buyers is excellent as well. The devil is in the details but it all starts and ends with price to value. This is not easy for most homeowners to understand but it is one of the most important considerations in your selection of who should be marketing the home in the first place. 

If your REALTOR makes it crystal clear to you that 90% of any good marketing plan is setting the correct price, then you may be on to something. If the agent told you that since most of the qualified buyers for your home are already under contract or already working with an agent, and they tell you that 50% of the actual marketing plan is directed to the agents who work with the Buyers in the greater area that your home is in, you are hearing the beginnings of a great plan. If the agent has as part of the marketing plan an excellent Internet Marketing presence, hang on to that agent because your home is most likely going to be sold soon. This is, with the the following caveat. 

The CMA prepared for you and used to reinforce the entire marketing plan is a bit like looking in a rear view mirror. It doesn't tell you the future of the market but rather where the market has been. The market is ever changing with strong economic influences from sources that have much to do directly or indirectly with what your home might be worth at any given point in time. An easy example to understand that principle would be the cost of money. You don't control that cost but it influences the Buyer's willingness to purchase. If your agent helped you comprehend what the accurate current market trend is and if it happens that it be currently be Buyers Market, and you priced your home too high-big mistake! A huge mistake in fact that will take some real effort to recover from. Many sellers of course won't recover.

If you priced your home in a range where comparables have been that have been more upgraded than yours, that is another big mistake. Buyers tend to search for properties at the top end of their qualified price range. They do not expect to pay top dollar and get less. Your home will be passed over and over. Buyers that would be suitable for your home at the correct price then would just as likely not ever see it. 

This miscalculation, renders the usefulness of the marketing plan out of sync with the market and most everything done or planned marketing wise will not yield the expected results. Selling your home for the most money and in the fastest time possible will face many obstacles that should not be there.

As a seller you must clearly understand that you are partners with the REALTOR you choose and your duty is the most difficult. Understanding that you will not be the exception to the pricing rule, no matter how many nice things you did to stage the property with strenghten your position in the market. If the property is priced wrong for the current market, you are in for some very disappointing results.

Is it your fault then that the agent you hired took your listing overpriced?  That depends on you. Was it your main real consideration in the interview process and further did you accept a marketing plan that was based on the wrong ( rear view mirror) criteria. If you want professional results and have hired the professional, then you should relinquish your unrealistic hold on what you think your home is worth and allow the REALTOR to market your home correctly ( at the correct market value) to where the Buyers are and then you can enjoy the results of having contributed greatly ( pricing the home correctly in the first place) to the winning marketing plan.

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The Basics of a Structured Sale and Why You Should Know About It

The Structured Sale found within IRS Code Section 453 can be a useful financial planning strategy for sellers of appreciated residential real estate holdings acquired through a 1031 Exchange. This is an ideally suited tax deferral vehicle for baby boomers and retirees that want to cash out but also wants to defer the big tax bite.  A Structured Sale combines all of the tax-deferral benefits associated with a traditional Installment Sale, while providing guaranteed interest-bearing income payments and lump-sum distributions over a period of time in the form of an annuity.

The financial advantage of a Structured Sale when compared to an immediately taxable sale is generated from the ability to defer capital gains taxes to some point in the future, thereby leaving more funds available to work ( earning a guaranteed interest rate ) on behalf of the seller over time.

This Structured Sale as a vehicle is particularly beneficial to those individuals who are ready to "cash out" of the appreciated asset, such as a business or of real property, in preparation for converting that asset into income for retirement and/or estate planning purposes. Because of this guaranteed income, it may fit their need for a consistent, stable, and predictable income.  This idea is especially useful as it might apply to circumstances such as transitioning a parent or themselves into retirement-oriented or even "assisted" living situations. Real Estate Investors are typically capable of creating larger incomes to meet their needs by deferring the capital gains taxes that would otherwise be 100% due in the year of the taxable sale, and can do so on a guaranteed basis with no future interest rate or investment volatility risk that would associated in the Installment Sale.

As with all tax and legal issues, it is essential that the Investor seek the advice of knowledgeable tax and legal authorities before making decisions affecting their investments.