Home Selling in 60302>Question Details

Jane, Home Seller in Oak Park, IL

What matters most?

Asked by Jane, Oak Park, IL Mon Aug 20, 2007

Without getting into too many of the details, my house has been on the market for about two months now with a fair amount of interest, but no firm offers. Recently, someone criticized my listing price as far, far, far too high because it hasn't been extensively updated. I countered his criticism by pointing out that instead of adding granite counter tops (for example) we chose to upgrade things you can't neccesarly see - like putting in a new furnace. And, since there's only so much money we can spend on upgrading per year, we chose function over style to make sure we didn't freeze to death in the winter.He said that details are what matters to a buyer and I completely agree with him but, really, what are the more important details? Granite or heat? I realize that's a silly question, but what I'm getting at is do granite countertops, as an example, really make a home that much more buyable versus mechanical upgrades? I have my own opinion, but am curious what others think.

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I think you have received good answers to your question although they may not be what you wanted to hear..Most buyers aren't being difficult or demanding. They feel that with the price of homes in todays's market the home should be in good condition and that means the systems as well as the cosmetics. Basic manintenance is taken for granted. Smart cosmetics will give you extra clout over the competition.

Most buyers are working long hours and many just don't want to have to come home to a project. They are willing to pay a price to have it in good shape. By that same token they want a discount on homes they don't feel are in excellent condition. I'm guessing that if your home is being shown and no offers are coming in then the house is priced too high for the current condition.
3 votes Thank Flag Link Tue Aug 21, 2007
Kaye Thomas, Real Estate Pro in 90266
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Buyers buy emotionally, then logically rationalize those decisions. We all do this; not just with housing. We all pride ourselves on approaching decision making with logical thought processes, but emotions run high on the scale as an often dominating influence. The advertising industry has long known this and they develop marketing campaigns that spur and satisfy emotional needs, selling the sizzle and not the steak. One auto mfgs sells prestige, another sells practicality, and another sells safety. If we opt for the prestige car, we rationalize extra expense with the quality. If we opt for the practical car, we rationalize our prudent choice. This is human behavior in purchasing, and is not limited to real estate.

When it comes to housing, buyers respond first by emotionally connecting with a property. Buyers start to develop opinions at the curb. Immediately upon entry, buyers have some type of reaction and an experienced agent will start to read that reaction. Different buyers in different markets will have varying hot buttons. Your Realtor will be able to help you understand the subtle nuances in your neighborhood. Granite may be a hot button, or an expectation in your market, or simply be a nice upgrade. Once a buyer walks through and becomes emotionally engaged, they will start thinking about the furnace, a/c, and hot water heater. So, ultimately, yes the buyer simply put, wants it all.

Marketing property is partially about packaging the message for the right buyer. (NOT talking about fair housing here!) Review your marketing materials and see if the message that you are sending appeal to the buyer who will be first and foremost concerned with function, peace of mind, etc. Particularly, if you want to appeal to the buyer who values function and mechanics, make sure the rest of your home presents a well taken care of image. Shiny sinks and no clutter go a long way in reinforcing the well tended home image.
3 votes Thank Flag Link Tue Aug 21, 2007
Deborah Madey, Real Estate Pro in Red Bank, NJ
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Ted, so much for the short answer!
Jane, while buyers do expect the mechanics of the home to be working, they want a little updating as well. I understand your frustration and your limitations. We all have them. If you don't have the money to do the updates, one thing that might raise interest is to offer an allowance at closing for updates. You can decide how much. It may be easier to give a little back at the closing table than to give it up now. This may get people to looking with a different sense of purpose. Unfortunately the way the market is now, buyers are able to get more goodies from the sellers, and they like this. They will take full advantage of it while it lasts! As a buyer, we would all feel the same way most likely!
Web Reference: http://carriecrowell.com
3 votes Thank Flag Link Tue Aug 21, 2007
People expect homes to have things like furnaces and hot water heaters, but mention the upgrades like granite countertops, radiant heat, etc and you really get their interest.
Web Reference: http://www.dianeglander.com
3 votes Thank Flag Link Mon Aug 20, 2007
I'll be glad when people start putting something on their counters beside granite-I am tired of hearing about granite. Jane, they are just trying to neg. the price. If everything is clean and neat and in working condition, tell them to write an offer and forget about your granite as long as the counter you have is in good condition
2 votes Thank Flag Link Tue Aug 21, 2007
Thanks for the responses!

Steve and Heather: I'm acutally not sure who made the comment! It was somebody responding to an Internet posting for the property. He chose to remain anonymous and never identifed what his expertise was or why he felt as he did. I don't put much stock in what he - or she - said, since he never really explained himself fully.

And, let me explain a little further that's it's not like the house still looks like 1965 is alive and well. It's had lots of upgrading done, just not what this particular person was looking for - I guess. And, it's not like I came up with a price I thought sounded good. I had several CMA's done prior to pricing so I'm hoping I'm not too far off the mark. There has been a lot of interest in the property so we must be on target, just no offers. And, I'm very impatient. Two months isn't that long in this market!

Ted: I understand your point completly, and, in fact, I believe we lost out to another home on the market that had certain upgrades completed that we do not and that house was listed at more than ours. But, I don't believe that our counters are standing in the way of a sale. That house just suited their needs better (or, that's what their agent said, anyway).

We are offering a bonus right now as an incentive to buyers, so, who knows what will happen. I'm still confident that someone will want the house as it is. But, the guy who e-mailed me did get me thinking about what matters most to buyers. And, more importantly, what gets them to make an offer!
2 votes Thank Flag Link Tue Aug 21, 2007
Jane, Buyers are expecting the house they purchase to have functioning mechanical systems. Upgrades are what set your property part from the others currently on the market. I have found that it is a good idea to tour some of these properties with your Realtor to see what is available. If your property is less equipped these properties, Buyers will move to the other homes.
Web Reference: http://www.chrisroark.com
2 votes Thank Flag Link Tue Aug 21, 2007
Hi Jane,
It's frustrating, I know, but most buyers make their decision on emotion, and furnaces just don't evoke
the same excitement as granite! I recently worked with a very savvy buyer who knew just what to look
for "behind the scenes" to be able to tell how well-maintained a property had been. He spotted something in the basement I hadn't ever seen before; it was a pump that indicated the homes sewer lines were lower than the public sewer line it connected to, so the waste had to be pumped upward. According to him, this was just one of many negatives about the condition of the home. The original albeit charming) wood window frames were rotting out, etc. However, there were swarms of potential buyers in the house oohing and ahhing over how beautiful the woodwork and staging were, and talking about how much over asking the house was going to bring! My buyer just chuckled and we left. That said,
I wish you the best!
2 votes Thank Flag Link Mon Aug 20, 2007
Honestly, like selling any product, image does matter. Mention granite counter tops and many people do get a little excited. I do agree with you the big ticket items are important to have in working order, if not new (roof, A/C, heater). The guts and workings of a home are indeed important and vital in calculating the worth of the home (status of the home, quality of the workmanship, major items in working/good condition, etc). If not that person has never had to replace one of these items and see the bill.

There are definitely tag terms which appeal to people these days that hold high "emotional" value to people like "granite counter tops." People want to feel like they have an upscale, updated, customized home and often don't realize how great it is to have a NEW a/c unit and what it translates into an actual monetary amount within the home until an agent explains it to them.

Was it an agent or neighbor that made this comment? I am not sure if this applies, but unfortunately not everyone has the gift of delivering comments or critiques well, but if it was indeed an agent that knows the inventory well in your area, there may be some reason to their thought and might be something to consider. BUT if you have had support in the positive of your pricing, in the majority, listen to them. Don't let the negative feedback resonate and keep with you.

Good luck with your pricing and listing.
2 votes Thank Flag Link Mon Aug 20, 2007
Steve Ostrom, Real Estate Pro in Roseville, CA
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Jane - Keith was dead on - as a home owner you will make improvements most times based on your to maintain the house( i.e. I need a new water heater because the old one stop working, or a new roof, or windows etc) Buyers have basic needs to and most times assume the homes they are looking at have those items covered (roof, windows, kitchen, baths, etc). What you are dealing with are the "WANTS" of the current buyers - I want granite, or a master bath, or an oversized garage, or finished basement. Don't get frustrated - try and understand where they are coming from.
I am guessing two things are happening with most of your potential buyers. 1. they are either first time buyers or 2. condo move up purchasers - which in both cases would lead me to believe the New Construction in our area(Chicagoland) is influencing what they believe should be standard features in their home purchase.(every Friday, Sat. and Sunday the Trib is loaded with Developers advertising their inventory with free incentives) Or what they are accustomed too in their current home(a condo decked out with granite, masterbath, hardwood flrs, stainless steel appl.- all standard stuff over the past 5 yrs).
How do you compete with this - first, if you have not already put your own brag book/list together on the improvements you have done to your house or features that bring real(dollar) benifit to your house do it know. Example: Your finance - cost of it, annual projected saving, life expectancy etc, Windows, Roof, Water Heat, Major Appliances, Electrical, Plumbing - anything, everything which would translate into cost savings or non-expenditures by the future home owner. Put a home warrenty on your house -
Also, have some estimates done to cost out the improvements that your house seems to be lacking. What would it cost to have granite put in, or your roof redone, or your basement finished etc. The key is "Know what they think they know......"
1 vote Thank Flag Link Tue Aug 21, 2007
Jane
I think you actually have answered your question. "We chose function over style". That's great when you are living in your home. That's no so great when you are selling it. Your Realtor should have provided you with some staging tips. I don't know your market, so assuming it's a buyers' market, a couple of thoughts:
1. Since your home went on the market, have other homes like your sold?
2. Since your home went on the market, have other homes come on the market?
3. Have you looked at the homes with which you are competing?

Put your self in the shoes of the buyer. You'll need to set pride aside and try to make an objective assessment about your property and how it compares. It might be that some home staging will help the marketability. You also may want to consider some other buyer incentives, such as a buy down program. That will immediately make your home more affordable to buyers.

What other incentives are sellers offering?

Good luck
Keith
1 vote Thank Flag Link Tue Aug 21, 2007
Keith Sorem, Real Estate Pro in Glendale, CA
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It's all important. Buyers expect that the house the electrical, plumbing, heating and water in normal working condition and there is a water tight roof.

It's the home that has the remodeled kitchen and bath along with the one that looks like a model that will get the most activity and sell within that first 30 - 45 day period. Updating a kitchen and bath are big ticket items for a buyer.
Web Reference: http://pamwinterbauer.com
1 vote Thank Flag Link Mon Aug 20, 2007
Pam Winterba…, Real Estate Pro in San Ramon, CA
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Jane - My short answer is... BOTH. Buyers expect to purchase a home with things like functioning furnaces and air conditioning, roofs that do not leak, siding that is not defective, plumbing that works, as well as reliable and safe electricity. After all, new homes have all these things and usually much more. It's the "more" part that makes or breaks you when compared to your competition.

It has been my experience showing properties that home buyers really get excited and light up to see things like granite or solid surface countertops, stainless steel appliances, extensive use of real hardwood flooring, updated light and plumbing fixtures, real wood cabinetry, etc.

Let me try to put things in a perspective that you might be able to relate to. Let's assume that your home and your 2 closest competitor's homes all have the same approximate square feet, same # bedrooms and baths, similar floorplan/layout, same finished/unfinished basement, same 2 or 3 car garage. All 3 home are priced within 5% of each other and are considered priced near market for the area. Oh, did I mention that your 2 competitor sellers have agreed to offer a home warranty to a prospective home buyer? The warranty will cover all major appliances and systems like the heat and air conditioning unit for one year from the date of closing and is renewable annually for a modest fee. In walks Joe & Sue Homebuyer. They are move-up buyers who have been cramped in a small 3 bedroom 2 bath home with 3 kids for the past 5 years. Their former home had white laminate countertops. Joe is a chef and does most of the cooking in the household and hopes never to have to prepare food again on cheap builder-grade laminate (with it's stains, burns, knife marks). Sue loves the look and feel of granite countertops. In fact, it is the number one item on her want & wish list. All of her friends have granite, her parents just had new granite countertops installed, and she's not giving up on her dream to have a kitchen with granite. Joe's on-board with the plan since he won't have to spend countless weekends either installing them himself or putting up with the inconvenience and interruption of his work at home while 2 men and a young boy spend the next 2-4 weeks remodeling the kitchen. Joe & Sue tour all 3 homes. When their Realtor asks for feedback, which home do you think they talked about the most, were most interested in, and most likely to make an offer on - the one with the new heat & air system or the ones with granite countertops?

Do you think that Joe & Sue might be willing to pay a little more for the homes with granite already installed? To save the stress, frustration and inconvenience - you bet they will (and it's a sure bet every time).

Now, for the good news. If you think that your countertops are standing in the way of a successful sale (and it sounds by your own description and feedback that they might be), then rather than spending $3-5K for new granite countertops, I recommend that you look into and get quotes for the professional installation of granite tile at a fraction of the cost (probably $700-$1000). I rarely recommend that my listing clients spend money for upgrades on a home that they about to sell and not get to enjoy themselves; however, sometimes you have to spend some money to make some money. Best wishes for a successful sale.
1 vote Thank Flag Link Mon Aug 20, 2007
TED SHOOP, Real Estate Pro in Buford, GA
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Consider having your realtor highlight the dates & mechanical improvments to your home on your listing sheets. Good luck selling your home : -)

Greg Zaccagni
0 votes Thank Flag Link Fri Mar 21, 2008
I can see both sides of this working for or against you. Granite is great yes but you can also overdo a remodel. Case in point most homes in my area are $100k-160k range they tend to be minimally appealing kitchens with OLD kitchen with formica type counters and laminate flooring. We recently REDID our kitchen and put in butcher block counters and new cabinets and porcelain tile all for under $5,000(we did the labor ourselves). Our listing agent came by and his lip dropped in amazment. He said it would sell our house. Every other house for sale in our neighborhood still has kitchen from when these homes were built in 1939. So just because HGTV says granite is the only way to sell your house doesn't mean that's set in sotne (pun intended, I crack me up). Personally I would rather have the updated systems any day. I agree a pretty kitchen AINT gonna keep you warm. The bigger question here is are you competing with what the neighborhood standards are?

I agree it's not a good time to sell but if you aren't in foreclosure and don't have a pressing reason to sell what's the worst that could happen? you have to stay? how horrible is that?
0 votes Thank Flag Link Fri Mar 21, 2008
Jane,
keep the house. not a good time to try to sell a house.
0 votes Thank Flag Link Wed Mar 19, 2008
Jane. Fair amount of interest is good. 2 months on the market is ok.
don't get anxious ...it is my own opinion that when purchasing a home, functionality should be more important than looks. you made a smart move in fixing the important things rather than updating areas in which every taste is different. If you had a yearly budget to work with, you did what made you feel like it was "Home" and it was your home.

But for a moment you need to see things from a buyers prospective and they want to see it as their home.
I think it would be a good idea for your agent to do another CMA with adjustments. It would probably help if you went out and saw for yourself your competition. keeping in mind that the units that SOLD are your best resourse for coming to terms with where your price should really be.

and no question is silly. :)
0 votes Thank Flag Link Tue Aug 21, 2007
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