Posts Tagged ‘bank owned homes’
Not so, says Realtor Joe Finnerty, of Prudential Patt, White Real Estate. Finnerty and his clients encounter homes with dirty dishes in the sink and an overflowing cat litter box.
“A part of you wonders: Did the agent tell them what to do?” said Finnerty, who has an accredited home stager on his team. “I have heard sellers say before, ‘If somebody really wants the house, they will overlook that stuff.’ They won’t.”
Real estate agents and home stagers say the surefire way to sell your home fast is staging, either with the help of a professional or by following the simple, effective rules of the trade.
A house that sells fast is clean, clutter-free and looks well maintained. Staged homes sell for about 8 percent more money since they sell faster, Finnerty said.
Real estate agents and professional stagers alike agree the window to make a good impression is small. An effectively staged home allows potential buyers to envision moving right in.
“Allow the buyer to see the house, not the seller’s belongings,” advises Therese Kelley, president of the Lehigh Valley Association of Realtors.
Most buyers will first see your home online, so you want stellar photos that show all aspects of the house, said Nina Evangelista, owner of Staging It. She warns that clutter jumps out in photos.
“If they don’t like the pictures, they won’t call. The better the photos, the more traffic you will attract,” she said. “The more space and the cleaner the home appears, the faster the sale.”
If an online listing piques a potential buyer’s interest, most then hop in the car and drive by the home, Evangelista said. That’s why sellers need to evaluate their entire home with a critical eye starting with the view from the street.
Lawns should be well maintained, and if it’s spring or summer, plant flowers, Kelley said. In fall or winter, make sure leaves are raked and walkways shoveled. Give the front door a fresh coat of paint and put new numbers on the house.
“It makes the prospective buyer think they really took care of this home in other ways,” Evangelista said.
If the target buyer is a family with children, list your home in the spring, said Shoshana Gosselin, an interior designer and stager who owns Love Your Room. Families don’t want to uproot their children mid-school year, so they typically aim for a summer move.
The house should be spotless. Get carpets shampooed and drapes cleaned. Eliminate pet or food odors and send Fido to the neighbors. Ditch the tchotchkes and take down the personal pictures.
“If you go into a living room and the whole wall is covered in family photos, it’s hard to picture yourself there,” Finnerty said
Buyers are nosy
Prospective buyers aren’t like polite house guests, warns Gosselin. They will be looking in closets and storage spaces, so start packing and purging.
“You want them to open a closet and see how big it is, not all your shoes,” she said.
Replace dated light fixtures or draperies. Make sure light bulbs are all working and turn all the lights on before a showing, Kelley said.
“Little updates, details are what sell a home,” Gosselin said.
Has your wife been nagging you about that door that sticks for years? Chances are, Kelley said, buyers will notice that too. Save yourself the trouble and fix it before your home goes on the market.
Paint and carpet are two of the cheapest and biggest updates a seller can make. Slapping a fresh coat of paint on the wall has a 109 percent return on investment, Evangelista said. Stick to neutral colors and bring in pops of color with accessories, said Gosselin, who recommends Benjamin Moore Marble Canyon as a buyer-friendly paint color.
Solutions big and small
Fixes don’t have to be expensive.
Put that dated fire screen in storage and let the fireplace shine with a fresh stack of firewood, Evangelista said. Or swap out the kitchen hardware.
“You want to appeal to a vast amount of people,” Evangelista said. “Not to one small unique set of people.”
The return on investment for major updates like a new furnace or roof is tricky because buyers expect homes to have these things.
“If you pay $6,000 for a new roof, we can’t raise the price by $6,000,” Finnerty said. “It definitely makes it more appealing. If the roof is totally falling down, you will get every penny’s worth back.”
If you fear the age of your furnace could be an issue for potential buyers, Kelley suggests having it serviced and finding out the replacement costs since it will impact your bottom line. Savvy buyers check a unit’s service card, she said.
Real estate agents agree vacant homes are the hardest to sell. If the owners have moved out, Kelley and Finnerty strongly advise renting furniture and staging a home.
Stagers offer tiered services ranging from one-time consultations to total home overhauls with new furniture and accessories. One-time consultations typically result in a report with suggested updates.
If you can’t afford to hire a home stager, ask your real estate agent for help.
Know your target buyer and get your home ready for that person.
Eliminate niche and personal items from your home.
Rooms look smaller without furniture, so placing just a bed in a room helps buyers with scale.
Small, inexpensive updates can make a huge difference.
There are many houses on the market that are currently sitting vacant all across the country. Many are foreclosures, short sales and bank owned properties, but thousands upon thousands that are owned by traditional sellers who are current on their mortgage and are trying to sell the property for one reason or another.
Many property owners are choosing to downsize in this tough resell market. Some owners are choosing to upsize, and take advantage of the favorable interest rates and lower home prices to move up into a bigger home. And there are the people who move and relocate for job, family, health, or retirement purposes. For many reasons, there are countless numbers of property owners in today’s market who own 2 houses, with one sitting vacant and listed for sale.
Vacant homes attract problems. From break ins, to vandalism, to an unkempt yard and bad landscaping, missing AC units, utility costs, broken pipes that go unfounded for a long time, and others, there are many reasons not to want a vacant house sitting for too long.
Not to mention there are certain cities across the country where vacancies are more prevalent:
But there are real options to consider for your sellers with vacant houses. Here are some viable solutions to the vacant house not selling headache faced by many:
Rent the house
You’ll need a standard lease agreement applicable in the State your property is in. Or your seller can hire an experienced real estate agent or leasing agent to help lease up the house as well. It’s important the owner has someone who is experienced in leasing (and licensed in most cases) complete the lease agreement and any other applicable documents. Owners tend to want to save money and do things themselves, only to do them the wrong way and subsequently lose money and time. Plus, if an owner doesn’t follow the landlord-tenant laws in their respective State, the owner could become the defendant in a lawsuit even when the tenant doesn’t do what he or she is supposed to.
Do a lease with option to buy
Similar to the lease agreement, a lease with option to buy includes the lease plus a separate purchase addendum. The purchase addendum gives the tenants the option to buy the house they are living in for an agreed upon price and within a certain time frame, usually running concurrent with the lease agreement. If the tenants don’t exercise their option to purchase the house prior to the end of the agreement, they can either move out, or renew the agreement with the owner.
Many people call a lease with option to buy a lease purchase, rent to own, and other misused terms. I specifically use “lease with option to buy” because I want to make it clear the tenants are still tenants, not “property owners”. If the tenant doesn’t pay, the owner would evict just as he or she would on a regular lease agreement.
Contact a staging company such as Showhomes
I’ve professionally used a company called Showhomes on many of my vacant listed properties in the Greater Kansas City area. I know Showhomes (and there are probably some other similar companies) is in many major metropolitan areas across the country. I’ve found the benefits of using a company such as Showhomes are many.
One, there is no upfront fee. Two, the vacant house gets both staged and occupied for the duration of the contract period (usually until the house sells). Three, someone else is paying for utilities and yard care. This is HUGE if your vacant house is in a winter climate! Fourth, there are no long term contracts with tenants; rather Showhomes uses home managers who are independent contractors with very short term agreements. I know from experience a well staged and well cared for house sells quicker and for more money than a vacant one! I have personally had good experiences using Showhomes.
To find out more information about Showhomes go to www.showhomes.com
(And no, I am not affiliated with Showhomes nor a paid spokesperson, just offering personal and professional experiences I’ve had)
Good luck with getting those vacant listings sold!
JJ Pawlowski, Broker / Agent
The Real Estate Investor’s Agentsm
Question: Is My Vacant Home Covered by Insurance?
Answer: I always warn clients that they shouldn’t wait for a vacant home to be vandalized before checking their insurance policy. A little known fact is that most homeowner insurance policies do not extend coverage on a vacant home for more than 30 days.
This means that if you’ve moved out more than 30 days ago, your home may no longer be insured, even though you may have paid the premium for your insurance policy. The verbiage is often in the fine print.
Short Sale or Foreclosure Vacant Homes and Insurance
In short sale situations, often the bank will send out a representative from a preservation company to determine whether the home is vacant. Even if you just moved down the street, these people will change the locks and notify the bank that the home is vacant. The bank may or may not take out hard-to-find and expensive insurance to insure that vacant home. They send the bill to you.
Types of Vandalism for Vacant Homes
It’s not unusual for a thug to cut off a lockbox in the middle of the night and take it home to drill out the key. Then, the thieves can return in the light of day and walk right in the front door. They back up a truck and before you can say “police,” they have loaded the truck with all of the appliances.
A thief does not need to break into a home to cause damage. A thief can swipe, for example, the existing electrical panel and A/C compressor unit fairly easily because these items are generally located on the exterior of the home, in a side yard.
Sometimes kids, just for twisted fun, will throw rocks through plate glass windows to watch the glass break.
In some situations, squatters break in and set up house. These aren’t the kind of people who bring in a table and chairs and use napkins. They typically sleep on the floor and throw empty beer bottles at the walls.
Getting Coverage to Insure a Vacant Home
Since you’re selling as a short sale, I take it you feel that a short sale is better for you than a foreclosure. Perhaps you want to protect your credit rating or make sure that no foreclosure is filed against you in the public records. You sound like a responsible person. To that extent, you may want to start with your insurance agent to find out how much a vacant home insurance policy would cost.
Those fees can vary from 2 to 5 times the amount of your regular insurance policy. Vacant home insurance can often be purchased monthly. You might wonder why a policy that covers an empty house would cost more than a policy that insures its contents but that’s because vandalism is very costly to fix.
Moreover, if your home is vandalized and the bank won’t pay for the repairs — and many banks will not — the buyer might not have enough money to buy your home — especially with an FHA loan — and also fix the damage.
Ways to Discourage Vandalism of a Vacant Home
People who do bad things like break into another person’s home tend to choose the path of least resistance. They want to break into the home that is the easiest to break into and the home that seems to invite them to rob it. Here are some ways to discourage vandalism:
- Put a sign rider on top of the For Sale sign that says “By Appointment Only” or “Do Not Disturb Occupant.”
- Have a friend of relative check on the home daily and pick up mail on the steps.
- Ask a neighbor to park a car in the driveway.
- Install security lights that are activated by motion.
- Set up a lamp on a timer to go on and off at specified times during the day.
- Use a security alarm.
At the time of writing, Elizabeth Weintraub, DRE # 00697006, is a Broker-Associate at Lyon Real Estate in Sacramento, California.
Nashville, TN (January 24, 2013) — Showhomes Home Staging announced today a completely new and enhanced website. The leading home staging services company in the U.S., redesigned its franchise development website to provide more information, staging examples, and other resources to those wishing to start a franchise focused on helping Realtors, Home Owners, Banks and investors sell vacant homes faster and for a higher price. The new website, http://www.showhomesfranchise.com, also includes videos about the services offered by Showhomes and home buying and selling tips for consumers. The site boasts a wealth of information including available territories throughout the US. The website was created to convey the company’s message of a strong brand and continued business growth. The website is a valuable resource for those interested in starting a new home staging business or converting their existing one to a Showhomes franchise office.
Showhomes Home Staging provides staging services for home owners, realtors, financial establishments, home builders and investors looking to sell vacant properties. Showhomes’ creative marketing strategy has aided over 25,000 customers sell vacant homes valued at over $8 billion. For franchise opportunities and more information, please visit www.showhomesfranchise.com or call 888-481-6742.
The Jacksonville Business Journal ran an article on Showhomes today and how we are doing more and more bank business nationwide. For many banks, the type of staging we provide fits their needs. Showhomes got its start doing bank owned homes in the 1980s and we contiue today. Take a look:
Heritage Bank Senior Vice President Greg Totten was a skeptic when he decided to try using a home staging company to sell a bank-owned property that had been on the market in Queens Harbour for nearly a year at $2 million.
After a home manager moved in and staged the 6,000-square-foot home, the number of showings increased as well as the dollar amount of the offers before it went under contract in September to sell for $1.5 million. Totten’s now a believer in home staging.
Home stagers specialize in furnishing and decorating vacant homes to make them look lived-in for prospective buyers. Although the industry started as an indirect result of the savings and loan crisis in the mid-1980s when lenders needed help selling a glut of foreclosed homes, since then most homes have been staged for homeowners — until now.
“Banks are looking to try to get the most from the homes they now have,” said Totten, who is the branch manager at the Ponte Vedra Beach branch of Heritage Bank. “We came out, over all, I think pretty well.”
In the last three to four months Showhomes franchise owners Jim and Kaye Biby said they’ve seen an increasing interest from lenders looking for help to sell some of the homes they’ve had to foreclose on. The Queens Harbour home was the first foreclosed home the Bibys helped sell with a home manager who actually lived on site during the staging process. They’ve already signed a contract with a regional bank, which preferred not to be named, to help sell one, maybe two foreclosed homes and is negotiating a contract with a third.
Kaye Biby, Showhomes Jacksonville
The Bibys have also staged a short sale home in Palencia that sold in 21 days in March and have signed a contract to stage another short sale in the World Golf Village.
The Bibys say they think lenders are becoming more interested in their staged properties, which typically include live-in home managers, because it reduces the bank’s overhead. Even though bank-owned home staging is growing, the Bibys expect it to remain a small portion of their overall portfolio.
In the past most banks maintained minimal upkeep on foreclosed homes, often selling them as is. Lynn Vitel, broker at Vitel Realty Group of Keller Williams Realty, said now with competition stiff in the residential real estate market, banks too are looking for a competitive edge.
“Staging means everything. It lets people visualize what the rooms are,” Vitel said. “The banks are having to smarten up.”
Sandy Steiner, an agent with Re/Max Specialists who used Showhomes to stage a property that was not a owned by a lender, said she expects that as market values continue to decline more lenders will reach out to home stagers.
“Banks are taking on a larger responsibility,” Steiner said. “They don’t want to be blamed for that one foreclosed property bringing down the property value for the whole neighborhood.”
Christy McCarthy, owner of Jacksonville-based Interiors Revitalized, said that while she hasn’t actually staged any lender-owned properties yet, she too has noticed the interest, and she understands why.
“It’s crucial to get these homes back in top-dollar condition so they don’t lose any more money,” McCarthy said.
Thomas Scott, Showhomes