Sellers should do some research before committing to repairs

It happens all the time. The buyer makes an offer on a house and have an inspection and then ask for some repairs. Homeowners say yes to the repairs without doing any research.

The sellers may find that they can not afford the repair or the repair can not be done or it can be done but will take weeks or months. Some repairs that seem small end up being a big deal.  Occasionally buyers ask for unnecessary repairs. They want a sewer line replaced because it has collapsed except it hasn’t collapsed.

Sellers should ask some questions and do some research before signing any kind of an agreement to make repairs. Find out how much the repair will cost and who can make the repair. Also, find out if permits are needed and if getting the city to sign off on the repairs will lead to more expensive work.

I have had sellers say yes to repairs and then let me know days before the closing that they could not get the work done. Sometimes it is something as simple as getting a window to work properly or removing a large freezer chest from a small basement.

If the buyer is asking for repairs you don’t want to make try reducing the sale price or paying for some of their closing costs so that they have the funds to make the repairs.

It is possible to sell a house without making any changes or repairs. Sellers can always say no but there is a tradeoff. Buyers tend to want thousands of dollars off the asking price in exchange for making hundreds of dollars worth of repairs. I encourage buyers to do some research before asking for repairs or discounts.

When I need to do a little research I often start by searching youtube.

 

Consider a 60 or 90 day contract

The real estate market is ever changing. The average number of days on market for homes that have recently sold in St. Paul is around 36. I say it over and over we are in a strong seller’s market, yet contracts with Realtors to list a home are for six months. Longer contracts may be good for people like me but are they the best for home sellers?

Six-month contracts are the closest we ever come to job security. We wake up each morning unemployed and are only paid after the successful closing of a real estate sale.

For the homes that are worth more then 600K a longer contract may be more appropriate but for everything that is at or below half a million six weeks should be a long enough contract. It is important to know the numbers.

Find out what the average days on market are for a home like yours that are in your area. Enter into a contract with a Realtor that is for an appropriate length of time.

Contracts can be extended as needed and home sellers who have shorter contracts have more control and leverage over the marketing process. If they do not like the way things are going it is much easier to switch real estate agents sooner. In some situations it may even make sense to put a home on the market for six weeks and if it doesn’t get an offer take it off the market and put it back on a few weeks or months later.

Go ahead and ask for a 60 or 90-day contract and also consider the six-week contract.

bumper sticker
We love short contracts

When highest and best goes wrong

If you are a home buyer you know the drill. House goes on the market and there is a deadline for making an offer. The listing agent will call for highest and best offer by a certain date and time.

Sometimes the time passes and the house is still on the market. Sometimes multiple offers are made by the deadline. Other times buyers were not interested enough to rush through the process and compete with other buyers so they did nothing.

Some listings have highest and best offer deadline in MLS and the dates are from weeks ago making me wonder what happened.

Home may buyers end up bidding against themselves as they are told that there might be multiple offers or that another offer is coming in. I strongly discourage buyers from raising the offer amount unless they are sure there are other offers.

If you are selling a home it is probably best if you don’t set a deadline for offers unless you already have an offer. Sometimes buyers think there is something wrong with the house if it is on the market after the call for highest and best.

Every year I have to explain to a new crop of buyers that they won’t be told what other buyers have offered and that they are more or less rolling the dice. In the end, I want my clients to be happy with their purchase. I don’t want them to feel like they were taken to the cleaners or like they paid to much.

When representing the seller I want to make sure that the offer that my clients want to accept will result in a closed sale.

Home buying isn’t easy these days and sometimes home selling isn’t as easy as it looks. I have seen houses that got multiple offers end up back on the market after the financing fell through or after the inspection. When buyers are paying top dollar for a home they don’t expect to have to spend a lot of money on repairs.

The more the buyer offers on a home as compared to the asking price the pickier he/she/they are going to be about the condition of the place.

Sometimes I chuckle when an overpriced house hits the market on a Friday with a call for highest and best offers by Monday.

There are still agents out there and real estate companies that believe they need to create a sense of urgency to sell a home quickly. We are in a buyers market which by its very nature means there is a high interest among buyers and a sense of urgency.

Downsizing and moving or not moving

Thrift store punch bowl

If you have children they may eventually grow up and move out which means you will have more space in your home.

If you bought a large house you may want to sell it and buy a smaller one, which means you will need to get rid of excess stuff.

If you already own a smaller home you might want to get rid of excess stuff and stay put.

As someone who has lived in the same small house for almost 30 years, I can tell you that even in a small house it is possible to accumulate a lot of stuff.

I can also attest to the fact that once most of the stuff is gone it is almost like moving into a different house except without the actual move part.

Getting rid of excess stuff that your kids are never going to want anyway can mean having a lot of closet space and some empty shelves and drawers. Not having to use the upper cupboards in the kitchen is a definite plus.

For us buying a smallish house was the right thing to do. There were a few years where it seemed a little cramped but we managed and now that the kids are out of the house it is the perfect size.

As I got rid of excess stuff I reorganized what was left. Now I know what we have and it is easier to find something when I need it.

If you have owned the same home for a couple of decades downsizing is a process that can take a year or more whether you move or not. Once you get to the point where you have less stuff you might find that you have more housing choices or you may find that you like your current home again.

Some people downsize by getting rid of excess stuff in one room at a time. Some get rid of one item a day. Others kind of do it all at once. I did it by area. One bookcase, dresser, drawer, closet etc. at a time.

The idea of getting rid of one item a day didn’t work for me. I reorganized one area at a time as I got rid of stuff.

During that second round of getting rid of stuff, I asked myself if I really needed all of those serving bowls or if I was ever going to use that stove-top pressure cooker my mother gave me. I also got rid of some items that I had hung onto because they were gifts.

Getting rid of books was hard but I still have plenty of them and I like to think that someone else is enjoying them as much as I did. I donated many of them to a nursing home that has a library.

I sold some of the excess stuff and I gave some of it away. I donated household items to a local thrift shop that is run by a church. At this point moving would be fairly easy. I like having less stuff. I also like owning a smaller home.

Everything works in a seller’s market

chandelier
light fixture

There are a lot of companies that want to sell products, services, and advice to real estate agents. We are in a strong seller’s market which means a lot of the advice on how to sell a home quickly for a lot of money works. Products and services designed to help homes sell faster and for more money are working well too.

The basics of selling a housework well too:

  1. Clean it up.
  2. Paint – as needed
  3. Repair
  4. declutter/stage
  5. Use professional quality photography.
  6. Price it correctly.

Advertising isn’t as essential as it once was but it does help attract a larger pool of buyers. For many of us selling a home is fairly easy. Getting the job done correctly and legally is still the hard part.

There are some challenges in selling a house. Getting through the inspection phase and getting it to close can be challenging. There are still risks to home owner’s who do not disclose information about their home.

There are still overpriced houses on the market that no one is making offers on. There are even a few that are unfit for use as dwellings without major repairs.

Sometimes homeowners and their agents believe that in a seller’s market they don’t need to disclose. That assumption would be wrong and could be costly.