The State of Real Estate Professional Opinions by Don Carr, ABR, GRI, REALTOR

The State of Real Estate: Miscellany

Have you seen the program on HGTV where the realtor is showing sellers comparable properties to theirs and he tries to get them to be serious about their properties and they are just not getting it. It is easy to see their misconceptions but sometimes we cannot look at our homes objectively. Here are a few concepts that I thought might be good to examine just in case we might be inclined to price our houses just a little higher – just to see what happens.

My house is the nicest one on the street. Or in the neighborhood. Generally we all think our houses are the nicest because we live there and because many times we have gotten them just the way we want them. Also if you live in a typical suburban neighborhood your house will be duplicated in many ways in the area. You may have a common floor plan, common exterior, even comparable finish choices inside and common landscaping outside. In this case we have apples and apples. When this is the case whether or not mine (or yours) is the nicest is a highly subjective situation. Remember what may appeal to you may not to someone else. It is often easy to change a house to fit what the buyer wants for just the little bit more you are asking or maybe even less.

I have done all of this work on my house; it must be worth more. The old adage is that kitchens and bathrooms sell houses and whatever you put into a kitchen or a bathroom you will get back and more. It is true that bathrooms and kitchens are the most interesting and the most individual rooms in our homes. Nowadays we expect a lot more in the way of luxuries and necessities than we ever have before. A refrigerator, be it avocado green from thirty years ago or stainless as new as tomorrow, still keeps the food cold. A basic stove cooks and bakes whether it does it with gas, electricity or has a combination convection oven. We all want the stylish things… the stainless, the granite, the newest fashion in cabinets and design. And there is nothing wrong with that. But we need to be careful when we start changing those kitchens and baths because the price tag can get very pricey indeed. You do not build or remodel for resale but you always should build or remodel with resale in mind. Enjoy your spa tub, your rainforest shower head, and my favorite, the alabaster under lit countertop, but remember much of what you spent will be for your enjoyment.

How do I know what is an upgrade and what is maintenance. This is a pretty easy question to answer. Does your house require it to function? Every house has to have a hot water heater, an air conditioner compressor, a roof, siding in good condition, windows that are clear and not fogged. You know the basic things you would think a house would have unless of course you are buying it to remodel for yourself or to flip, then you expect it to be in less than perfect shape. But for a normal house built to code in a specific year, the usual items we have to keep up or replace are not upgrades. Here in Central Texas we frequently get hail storms. Our insurance companies pick up most of the cost of new shingles and we can avoid the cost totally on our own. Whether or not the insurance company paid or I did, shingles that replace worn out shingles are maintenance, not an upgrade. So you put on a better shingle. Ask yourself how much you would add to the cost of a house you were buying for a little better shingle. In our case the thirty year shingle that gets to serve its lifespan is a lucky shingle indeed.

Fogged windows are a typical problem for us as well and aptly illustrate the difference between maintenance and an upgrade. Most of our homes have double pane vacuum sealed vinyl windows of varying grades of quality. They last a few years, always longer than their five year warranty, it seems. They do give way occasionally and have to be replaced. You can replace the panels (not the panes) for fifty to a hundred dollars usually or you could replace them with nice wooden windows which can be very costly. All houses have to have windows but in this case the replacement of the panel like your builder’s windows is maintenance, the fancy wooden windows are an upgrade and you might be able to get a little more for your house because of them.

When it gets to be time to put your house on the market think about what is maintenance and what is clearly an upgrade. Then ask yourself, how many buyers are going to care.

Whose fault is it when my house doesn’t sell. We all like to have someone else to blame. Mothers in law, husbands, wives...we all want someone else to be at fault. As a Realtor I am frequently at fault. After all I am the one who wants to market your house and claims to be doing my best. I may even think I have the key (and I do have the magic key) to selling your house. You may not want to know what it is, but it is the magic key. So whose fault is it when your house does not sell. It is nobody’s fault any more than hurricanes or earthquakes are someone’s fault…..it is the fault of situations that most of us have no control over at all. When prices in California, Washington D C , the Northeast, you fill in the blank , went through the roof and owners were making sometimes several hundred per cent more than they had paid for their houses, not one was asking whose fault it was. But when the market collapsed and foreclosures became common place and people added “short sale” to their vocabularies, then it had to be someone’s fault. A market is a market is a market whether you are selling a camel in Marrakesh or a house in Texas. Two things are laws. Like gravity, the market will set your price and the market will tell you at what price your house will sell. All you have to do is pay attention and be realistic. Realistically you may not get what you want for your house. You may have missed the golden moment. One may come around again, and it may not, but if you want to sell in the current market, you have to listen to what the market is telling you.

Remember the realtor on HGTV and the people who are not getting it. It is easy for us to be objective watching them. Selling a home is always an emotional experience; we all want the most we can get for our houses. You know what that is, what we always get—the most our houses will bring. Nothing can be truer…a house always sells at market value.