Volume 176 - "Dust Me!"
A thick white powder has crept its way into every corner of my home. Every surface, every dish, and every article of furniture and clothing is coated with renovation chalk. (Ugh!) I'm tempted to write "dust me" on the piano but what's the point? I've given up (or is that given in) to the mess that was previously my sanctuary. Now it's just plain frightening!
The drywall crew took up residence last Monday morning and there's no keeping up with it. You'd think that after five previous home renovations, I would remember how horribly inconvenient the remodeling process is - especially when I've physically lived through each one of them - but I've conveniently blocked it out - kind of like childbirth (also an extraordinarily unpleasant process to my way of thinking.)
Having come too far to turn back, there's nothing for my discomfort, but to close myself off in my dusty bedroom, under my dusty blankets, and bury myself in a dusty book . . . At least there's a light at the end of the tunnel. With hardwood floors now being laid and tiling currently underway in the bathrooms, "Phase One" of the renovation should be completed within the next few weeks and some small semblance of order may be restored at long last. (Whew! Just in the nick of time. I don't do well with chaos which means I make life miserable for those around me.)
So while this is all very fresh in my mind, let's break down the "Dos" and especially, the "Don'ts," of remodeling so that you can learn from my OH SO painful experience . . .
DO remodel if you love your street, your neighbors or your site. If your location is irreplaceable or one-of-a-kind, you are a good candidate for a renovation vs. a move.
DON'T remodel if no matter what you do or how much money you spend, the house next door (with its overgrown lawn and wintering boat) is forever going to be the bane of your existence. No matter how beautiful your home comes out, you won't be able to control the neighbor next door and you'll never be completely happy.
DO remodel if your marriage is healthy and your kids are young enough to enjoy the results. We have a really short window of time with our children as it is. Why add displacement to the mix?
DON'T remodel if the kids are in high school (wait until they leave), your marriage is on the rocks, or "indecision" is your middle name. Life is stressful enough.
DO remodel if you don't like paying for other people's taste and find picking out finishes, fixtures and lighting much more exciting than picking out a Holly Ball gown (I LOVE the flea market and hate dress shopping.)
DON'T remodel if the mere thought of walking into a Home Depot, a plumbing supply store or a window showroom is overwhelming. There are a thousand and one decisions to be made with a remodel (and I'm not kidding.)
DO remodel if you have a trust fund, have access to hoards of cash, or are heirs to a large fortune (a small one won't do it). Absent that, a very ample home equity line is key!
DON'T remodel if money is tight. Renovations notoriously run over budget - not because contractors take advantage - but because one never knows what is behind the walls until they are actually opened. Even pleasant surprises are going to blow the budget! Believe me, you are going to want to take advantage of them. (We found four extra feet behind my son's closet and an extra foot and a half in the ceilings. Grateful? Yes. Expensive? Yes!)
DON'T remodel if you expect the project to "pencil out." It's very likely that it won't. Even the very best renovations of bathrooms and kitchens don't return 100% of their investment. Renovate for your own enjoyment, but if you expect a decent return, keep the design choices fairly neutral. Metallic tiles date a home very quickly. White honed marble is timeless.
So to sum it up, DO remodel if you have a vision for your home, a gifted architect, a reliable contractor, you love your present location, have a desire to stay put, have the wherewithal to pay for the construction, married a supportive mate, have flexible children, can overcome the clutter, and possess the personality to overcome the challenges. If that doesn't describe your situation, let me help you find a new home - one that someone else has gone to the trouble to remodel for you!
Now if I can only save up enough money for "Phase Two . . ." (See, I'm already forgetting - I suppose that's why I had a second child too!)
Volume 175 - I Want The Hour Back!
"I'm tired," I said to my husband. "Me too," he replied. "The time change seems to get tougher every year." Yeah, it does. (I want the hour back!)
Sitting at my desk on Sunday morning, I startled as I looked at the clock. Shoot! I still needed to get my A-frames out, change into a suit, and bake cookies (yes, I do actually bake chocolate chip cookies before each Open House) and that's pretty much how the rest of the day went. Time definitely wasn't on my side. Scrambling to catch up, I felt like I was playing "Beat the Clock."
The same can be said for your listing. In the world of Real Estate, time works against you . . . What begins as a very exciting new opportunity for agents and their buyers, quickly becomes yesterday's news. Which is why I am always perplexed when sellers are reluctant to work with the first purchase offer that presents, as if it's just an appetizer for bigger and better offers down the road. It's not.
I know you have heard it a million times before, but it remains true: the first offer usually represents the most motivated and committed buyer! So unless the first offer truly misses the mark (and I mean by a long shot), it is probably a more realistic indication of market demand and performance, than a strategy or a desire to "low ball" the seller. (Make sense?)
Every agent tells the tale of a prior listing that received well-intentioned offers from eager buyers - but at "less than asking." Unfortunately, with respect to early offers, if they are "underwhelming," the seller often isn't ready to negotiate (timing is everything). Two years later (and typically with another agent) the home sells for significantly less (Ouch)! That never feels good. (In fact, it feels awful.)
Unfortunately, the longer your house sits, the more likely it is that you will be chasing the market, as opposed to making it, AND the more competition you will be facing as new homes steal your thunder and the fickle attention of your prospective buyers.
While I hate to be the bearer of bad news, it needs to be acknowledged that buyers have a fairly short attention span - and often times, so do their agents. With so many new homes to see, buyers want to know: "What's coming on next?" And having seen last week's new crop of offerings, they are quickly onto the next.
Which means that part of my conversation with sellers has to be about "the window of opportunity." With respect to the sale of your home, that window is approximately two weeks - give or take. (This isn't necessarily true for very high-end properties or for lots, which by virtue of their very small and specific buying pool, will take longer to sell than the average bear, but it is true for almost every other listing - no matter how "special.")
Is that tough news to deliver? Absolutely, and tougher news to hear, I suspect. But the truth is, if you want to sell quickly, you will need to reduce in today's more conservative marketplace. Setting aside your initial disappointment at receiving "less than asking," isn't it reassuring to have your home in escrow and securely on its way toward a successful close - especially with other homes sitting? (Yes, it is.) Try to put it in perspective; it's not an indication that your home is worth less, it's confirmation that your home is, in fact, in demand - but at fair market value!
So prepare your home for a quick sale through careful preparation and aggressive pricing and then prepare your mind as well. If you haven't sold in three weeks, it is probably time for a price reduction of approximately 10-15% (don't chip away at it in insubstantial increments.) The longer you wait, the more costly the discount becomes with each passing week.
Tick, tick, tick . . .
Volume 174, The "Money Call!"
"This is a money call," my son said. (Of course it was, why else do college age kids phone home?). "I need to buy dress shoes." (Okay, I wasn't expecting that.)
A few weeks ago, Case revealed that he'd decided to rush and been accepted into a fraternity (Phi, Kappa, Sigh . . .) Now that he'd been admitted, a makeover was clearly in his future, thus the impromptu phone call home. With dress shoes in hand, can pleated khakis, a sport coat and a tie be far behind? (Probably not.) I suspect this will only be the first of many such "money calls." Still, if it takes a fraternity to elevate my son's sense of style, I will happily support his decision and (less enthusiastically) write the checks.
"Less than enthusiastic" is how sellers often feel when they receive the dreaded "money call." Having negotiated and agreed upon price with a willing and qualified buyer, and having waited out the inspection and appraisal periods outlined in the contract with patience and good form, it can often be downright sobering news when buyers ask for - or demand - credits. More unsettling still, is the request for a price reduction in return for closing the transaction. Wait a minute - what just happened here? I thought we had a deal! (Not so fast.)
What happened is a shift in power between buyer and seller realities. Not that there aren't popular homes that still attract multiple offers in our marketplace (there are) but the vast majority of listings are taking longer to sell and when they do, negotiating back new discovery is "de riguer." It's the 80/20 rule: 80 % of the pending sales are experiencing aggressive negotiations while 20% are receiving so much attention that the buyers have little room in which to maneuver, which creates an understandable, but very real, disconnect.
So where does that leave you?
As a general rule, you should absolutely expect some push and pull in today's more conservative marketplace (think Dr. Doolittle) even in the case of multiple offers.
Here's the good news - you're in contract (!) and that's news worth celebrating, but don't pop the champagne just yet. Getting from the "accepted offer" stage to the "close of escrow" reality can often be a veritable minefield and regretfully, just slightly less painful than a root canal. (Throb!)
These nuanced negotiations are in large part the reason why, Realtors haven't gone the way of the travel agent - or the Dodo bird - nor should they, especially in our more topsy-turvy world. Now more than ever, you absolutely need third-party negotiators to navigate the home buying and selling "waters."
This is delicate stuff folks. Not only are we talking numbers, we are often dealing with emotionally charged decisions around the sale as buyers start to "second-guess" their love affair upon receiving an encyclopedic stack of "disclosures" (thump!) while sellers simultaneously begin to feel "insulted" at the microscopic examination their previously "lovely" home is now undergoing (twang!). Of course, the combination is highly volatile. Should we expect anything less?
Yes, we should - which is where thoughtfully outlined expectations come into play, as well as the experience of a seasoned agent and a "hands on" local broker (think The GRUBB Co.). With all due respect to the "win-win" school of thought, real estate transactions are often adversarial by nature . . .
So here's my list of GREAT Expectations:
So there you have my list of Great Expectations. Please note, you were warned.
Got to run, my son is calling . . . I'd better find the checkbook!
btw- my favorite response to last week's question"What sign best describes you?" came from a loyal reader who wrote to say that her moniker would have to be "Work In Progress!" That sums up today's market in a nutshell. (I couldn't have said it better myself.) Thanks to all who participated.
Quickly zipping through the hills on my way to work the other day, I abruptly slowed down when I came around a corner and I saw a sign that read: "Tree Trimming Ahead." A few blocks later, a second sign warned, "Curves" and at the next intersection, yet another shouted, "STOP!" When you look around, there are signs everywhere guiding us through our busy days and telling us what to do . . . "Sign, sign, everywhere a sign. Blockin' out the scenery, breakin' my
mind . . ." It got me to thinking about how much easier my job would be if my clients and colleagues wore signs as well (Come to think of it, how 'bout my kids?). I'd like to see GIANT capital letters that spelled out exactly who they are and how they operate in the world. Here are a few suggestions: "USE CAUTION," "SPEED BUMPS AHEAD" or "NO TRESPASSING!" (That would certainly clarify the relationships - don't ya think?) Unlike many jobs where one transacts business with the same customers or co-workers day in and day out, Real Estate is a series of primarily short-term projects with new players at every turn. Just as you need to get to know me, I also need to get to know you AND I need to do it relatively quickly.
This isn't just true of my clients, it's also true of the other agents I work with, the buyers or sellers they represent, the mortgage bankers and lenders, the appraisers, the title officers, the escrow coordinators, and the like. Other than a few key players on which I often can depend and control, I am frequently meeting many new personalities with each and every transaction. Without bold signs with which to guide me, the trick is managing all these complimentary, competing, or conflicting interests with care - "Yield to oncoming traffic?"
"Do this, don't do that - can't you read the signs?"
To a large extent, I can successfully read the signs. Directing traffic is part and parcel of the world of Real Estate. To be truly effective, an experienced agent should not only be adept at this skill, but excel in it as well. It begins by asking the right questions: "What are the sellers' motivations?" "What are the buyers'?" "What are their respective time lines?" "How quickly can the lender perform?" (And to the appraiser) "Are you familiar with the area?" "How long have you had your license?" With careful sleuthing and sometimes, unapologetic frankness, I need to accurately read the signs in order to best serve your needs.
So speak up and declare your intentions. The more signs you give me, the better off we both are. (It's the clients I don't hear from that I worry about.) Not only are you able to quickly retrieve the answers you desire, but I am more committed to the relationship with each phone call and email we exchange. (Aren't you?) "And the sign said you got to get a membership card to get inside, UH! " To a certain degree that's true. While markets are no longer exclusive thanks to the MLS (Multiple Listing Service) there are still high-end homes that really do require careful client vetting. Despite the undeniable access the INTERNET has now made possible, your position is greatly improved when you connect early and often with an informed agent. (No, not ALL agents are created equal.)
"Open for Business? " You betcha. Didn't you see my sign? Trivia time: Who wrote and sang the song, "Signs?" Complimentary lattes from Mulberry's Market to those who answer correctly OR to those who send me back their "sign" (astrological signs don't count).
Sitting at my Brokers' Tour last week, I couldn't help but relate to a colleague as he spoke to his manager on the cell phone. "I don't know what to do with them," he emphatically explained. "Should I or shouldn't I? Will I or won't I? Can I or Can't I? They're a combo platter of indecision!" (Is that all?) Add a mixed bag of opinions from "well-meaning" friends and relatives and it's a trip through the buffet line for sure. How do you come to a conclusion when there's so much at stake?
For many: "'To Buy or Not to Buy," "To Sell or Not to Sell," is a gut-wrenching decision. Next to a wedding dress, few purchases are fully front-loaded with so many expectations. And given that our homes often represent our single largest asset, the desire to "get it right," can prove down right paralyzing. (I get it. I do!)
Let me put you at ease. The best you can do, is to get it "mostly right." (Ahhh, don't you feel better already?) No matter what you anticipate, chances are you won't be purchasing your "forever" home. A condominium gives way to a "starter" home which gives way to a "family" home, which in turn, gives way to a "significant" home, which gives way to an "all-level" home, which eventually leads to "downsizing" and then possibly, a "condominium?" (We're back to where we started.) And rest assured - none of them is going to be "perfect." (If we waited for "perfection," none of us would ever attempt a bathing suit.) But aside from "perfection" (or the lack thereof) my main point is that today's decision - in all probability - is NOT nearly as permanent as you think it is going to be .
All this flip-flopping got me to thinking about a reality show I'm semi-embarrassed to admit I watch (but hate to miss): "Say Yes to the Dress," which follows an expectant bride as she searches for the "perfect" dress among thousands. It's clear that these nervous brides-to-be have spent their entire lives dreaming of their wedding day and more specifically, their wedding dress! Dare I say that for most of these young women, it seems to have been easier to commit to the groom than to the frock . . .
Thankfully, it has been a few decades since I walked down the aisle and I'm not planning on revisiting the altar anytime soon, so wedding dresses aren't exactly my radar. Still, I'm fascinated by the emotional tug-of-war this "dream acquisition" involves. Watching these girls' (and quite often, their families') struggle, I'm struck by the profound similarities between committing to a wedding dress and committing to a home. Here's what I've learned from watching the show and how it applies to Real Estate . . . let me know if you agree.
1.) The price of wedding dresses has gone up substantially in the last twenty years. (That's true of homes as well.)
2.) Your mother's dress is rarely ever the right fit for you. (Likewise, it's tough to make your parents' home, your own.)
3.) Weddings are seasonal. The Spring season is the most popular by far while winter weddings are less desirable. (The same is true for available housing stock. Spring represents the high point, winter, the low.)
4.) Keep your bridal party small! More opinions don't help provide clarity as to which dress to buy - they provide confusion! (Too many opinions only muddy the waters. Listen to your own voice - it's the most important one in the mix.)
5.) Regardless of your body type, ALL dresses benefit from good tailoring - a skilled tailor is a bride's best friend! (True - your home will fit you better when you customize it and make it your own.)
6.) Once a decision is made - stop looking! There's always another dress to see. Embrace wholeheartedly the dress you've chosen and stop second-guessing the decision. (Sound familiar? Recognize the solution and enjoy "the gift" when you find it. There will always be another home around the corner. It's inevitable - just as there will always be another dress.)
7) The dress shouldn't wear the bride. The bride should wear the dress. (Likewise - homes don't define you - YOU define the home.)
8.) Finally, no matter how beautiful the dress is, it won't make you 20 lbs thinner! At the end of the day - no matter how special it looks on you - it's just a dress. (Listen up - a home is simply a backdrop for the lives we live in it. Don't overwhelm the decision with unrealistic expectations a house can never meet.)
Here's my two cents (now that I've got your attention) - a home won't make your kids perfect, your marriage, perfect, or your lives, perfect (no matter how "perfect" the home). However, a home will provide security and a steady place to land (not unlike a solid marriage). If you are lucky, (as I have been) your home will be a creative journey; one that brings timeless memories, loads of laughter and great joy to your family - and that's not such a bad trade off.
So buy the home if it serves a purpose, meets your needs, and presents an elegant solution. A home is a noble and fine acquisition - and isn't that enough?
Say "YES" to the house" (and I'll provide the bouquet)!
Julie Gardner, has been writing The Perspective for 18 years and has published more than 670 essays on life and real estate.