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Michael Corbett's Blog

By Michael Corbett | Real Estate Pro in Los Angeles, CA
  • Open House Check List

    Posted Under: Home Buying in San Francisco, Home Selling in San Francisco, How To... in San Francisco  |  March 2, 2012 11:20 AM  |  1,574 views  |  No comments

    Open houses are an exciting adventure, but have their own set of rules. You need to follow them in order to turn open house shopping into a dream home purchase. I have created a list of 10 important "must know" items to make the most of an open house experience.

     

    1.     Start online - Almost all purchases begin with online research, and home shopping should be no different. Use Trulia.com to find out what homes are open in the neighborhoods you’re interested in.  Once you have done your home shopping in two dimensions - it’s time to move to three dimensions.

    2.     Think of each open house as a “House Buying 101” course –  Use every home you walk into as an opportunity to learn more about the home itself, as well as identify amenities you will want and things you won’t want in your new house.  It also a way to check out the neighborhood, local amenities and schools.

    3.     Look But Don’t Touch – Even if you happen to walk into your perfect house, you are not going to buy it that day. You must shop around first. Never make an offer on the first house you see, especially if you’re a novice home buyer.

    4.     Declare Your Independence – Tell the listing agent you’re already working with a Realtor and never, ever hire the seller’s agent to represent you. You need an unbiased advocate to negotiate on your behalf.

    5.     Hold Your Cards Close – Don't reveal too much about yourself, your situation or your need to buy. It's especially important to never reveal the top price you are willing to pay. You don't want that information to be used against you later down the line in negotiations.

    6.     Look for Hidden Gems – Try to look past all the clutter and personal belongings that some home sellers neglect to remove before an open house.  Some of the best home buying deals may be hiding beneath countertops lined with plaster roosters, walls covered in family photos, and bedrooms overwhelmed by 80” television monstrosities.  Are there are wonderful hardwood floors under the wall to wall carpeting?   And if closets are packed to the gills – look deeper - they may actually have more space than you think.

    7.     Interior/ Exterior Overview – If this one is a real possibility for – give it a closer look-see. Does the interior look well maintained?  Check out the appliances, condition of the windows and doors, look for stains on the ceilings, cracks in the tiles, even take a quick peek under the sinks.  If these visible items are not in the best condition, it may be a red flag and indicate larger issues. Then head outside. Pay attention to the exterior paint and the state of the roof. Will it need replacing in the next 2-5 years? What is the condition of gutters, chimney? Are there any obvious drainage issues?  These could all be big ticket items to repair.

    8.     Take Pictures and Take Away the Takeaways – Take pictures and notes as you walk around a home. If you see multiple homes in one day, they'll all start to blend together. Gather and keep the brochures or printout information sheets on the houses you see, and jot down one or two of the standout things you like and don’t like about each.

    9.     Keep Your Interest Under Wraps – Even if this is the perfect house for you, as Lady Gaga would say: keep your best poker face. Don't jump up and down with excitement in the driveway or lobby. Get at least a block away and then call your Realtor. If the seller's Realtor sees you salivating, you can potentially lose leverage as a buyer.

    10.  Not the right house for you? “Buy” the agent instead – If you haven’t selected a realtor, this is a fantastic opportunity to check out realtors too. You actually get to see them in action. Is he/she knowledgeable, informative, hard-working? Or is he/she sitting in the dining reading gossip magazine while you stroll through the house? And most importantly do you like him or her?

    Specific questions? Drop me a note!

    -Michael

  • Pricing Matters: Using List vs. Sales Price to Stay a Step Ahead

    Posted Under: Market Conditions in San Francisco, Home Buying in San Francisco, Home Selling in San Francisco  |  February 29, 2012 5:28 PM  |  1,316 views  |  No comments

    As savvy agents know, the only way to know what a house is worth is by knowing what other comparable houses, or “comps,” in the neighborhood for sale are worth. Contrary to what our parents taught us growing up, this is one of those cases where the true value doesn’t come from within…it’s actually based on those around us.

    Check List vs. Sale Prices

    Knowing the percentage difference between the actual list and sales prices for the houses in a neighborhood speaks volumes about the current market’s activity. This is a strong indicator which direction the market is moving, and will indicate how much less—or maybe even more—than the ideal asking price a homeowner can expect to get for their home.

    List vs. Sales Price Comparison

    List PriceSales PriceDifference (%)
    $180,000$159,000-13
    $420,000$405,000-4
    $1,200,000$1,350,00011
    $799,000$650,000-23
    $385,000$400,0004

    Generally speaking, if the percentage differences for homes that sold are between -5 and -10 percent, you’re in a soft market. Sellers aren’t getting what they think their homes are worth. And they probably aren’t selling their homes as quickly as they’d like. If the percentage differences are between -10 and -20 percent or more, the market is extremely weak. Of course, if those percentages are positive, then you’re in a warm, potentially hot market.

    Gauge the Temperature of Your Market

    To price for a moving market, consumers and agents will need to catch the wave whether it’s going up or down. If the market is heating up, sellers can up their price a bit from recent sales figures and comps. Tell your home sellers not to get greedy and try chasing the market—they’ll never catch up! Likewise, if it’s cooling down, sellers need to lower their price so they don’t over-price their home out of the market.

    Educate Clients, Avoid Mis-pricing

    The wrong selling strategy:

    “I’m putting my house on the market at a high price just to see what I can get. What’s wrong with that? Who knows, maybe I’ll get lucky!”

    We’ve all heard the expression, “Let’s throw it all against the wall and see what sticks!” This is the same principle and a very misguided approach to pricing.

    Sure, a few people do get lucky, but pricing according to realistic market prices is your clients’ best tool to a fast and profitable sale. The former approach will cause you to miss any opportunity of attracting multiple offers. It will also prolong the time it takes to sell and, eat up value time on the real estate market. Sellers run a great risk if their house sits on the market too long. At that point the home can become a dead listing and a target for vultures and bargain hunters. Ultimately sellers will end up selling their house for less than they would have had they priced it correctly initially.

    Over- or under-pricing is a huge money-losing mistake. Help your sellers understand the competition and avoid pricing mishaps. When it comes to getting sellers to agree to the right price don’t be afraid to use shareable knowledge – that includes data, market reports, and other dependable resources.

 
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