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2020 Year In Review

Now that 2020 is coming to a close, do you have any reflections on the year in real estate?

2020 is a year we will all be happy to see in the rear view mirror, and that day is coming soon! In March, we were all worried that the pandemic would result in a major down turn in real estate, and for a couple of months, the market barely had a pulse.  But when we moved out of the “red” zone, the market came crashing back like nothing we have ever seen before.  While there was a huge influx in inventory that resulted from the near zero level of new listings in the “at home” months, there was an even larger crush of buyers looking for a new home, and the summer months were plagued with bidding wars at many price points.  The lower price ranges saw significant appreciation as buyers vied for an opportunity at an affordable home in our school district, but even the two million dollar market saw more sales than it had in several years.  In most years, our market slows down in August, but not this year. As we head toward the holidays, we don’t have the extreme over-supply of buyers that we saw this past summer, but many homes are still selling fast and for top dollar. 

As we move into the new year, buyers are getting anxious.  We are seeing minimal new inventory (not unusual this time of year) and they are justifiably anxious about whether there will be a nice selection in the spring.  Being “stuck” at home, many homeowners have taken the opportunity to fix up the home they live in, and there is a real possibility that more people may be staying put for 2021 and enjoying the fruits of their labors. In the coming months, buyers will need to be prepared to compromise on their must haves and act fast if they see something that meets most of their wish list.  And of course sellers, please reach out to me right away if you are thinking of selling this spring.  Interest rates are low, prices are up and demand is high – there has never been a better time to sell.

As 2020 comes to a close, I wish you all a fabulous holiday season. It has been my great pleasure to work with so many in our community during this unusual pandemic year and I am looking forward to continuing to do so in 2021, a year we all have high hopes for! The Herald will not be published over the holidays, but you can check out my website,, for continued real estate advice every week!


[contact-form-7 id="115311" title="Get More Information Form"]
I’m ready to answer any questions you have regarding your real estate needs.
Kathe Barge, CRS, ABR, CNE, SRES
Associate Broker
401 Broad Street
Sewickley, PA 15143
Cell: 412-779-6060
Office: 412-741-2200 x238


We’ve been watching and calling listing agents about new listings. Agents keep asking me if I have a buyer’s agent. Why would I want one?

It ‘s a good idea to recognize exactly what a buyer’s agent is to you – essentially an almost free invaluable resource to you in the buying process. You might think you will save money if you don’t have an agent that needs to be paid, but in reality that’s not how it works. The sellers have signed a listing agreement obligating them to pay a commission to the listing brokerage house of an agreed percentage and that percentage does not get adjusted if a buyer does not have an agent. So there is simply no advantage to not doing your research and choosing your own advocate before you begin the buying process.

In a recent study done by the National Association of Realtors, the #1 benefit all buyers put forth for having a buyer’s agent? A buyer’s agent helps her buyer understand the process of buying a home (74% of millennials found this to be true). Buying a home is a significantly more complex process than you might imagine, and if you have a well-trained agent, she should make it look simple. However, if you don’t buy and sell real estate everyday, there are many traps for the unwary.

The #2 ranked benefit of a buyer’s agent? A buyer’s agent points out unnoticed property faults or failures. A full-time agent is in and out of homes on a daily basis and after years of experience has developed a fine-tuned ability to pick up issues that most buyers would never notice, and will hopefully be able to suggest proposed solutions as well. This is no substitute for a home inspection, of course. Third on the list of benefits? The buyer’s agent negotiated better sales contract terms than the buyers could have negotiated on their own. Again, years of full-time experience coupled with a dedication to staying educated in the profession should hone an agent’s ability to give you excellent negotiation advice.

The #4 ranked benefit? Buyers reported that their buyers’ agents improved their knowledge of search areas. This is particularly helpful when you are looking to move to an area you are not very familiar with. Finally, the 5th ranked benefit of a buyer’s agent is that she can connect you to a better (and hopefully more reputable) list of service providers than you might have access to on your own. All of these benefits can be yours without the fee of the commission – all a buyer pays is the small “broker fee” (which is charged to both buyer and seller) of approximately $325! This is a small price to pay for a long list of benefits and expert advice on what may be your largest investment! My question is, why wouldn’t you want one?

Call me!! I can help! 412.779.6060

I’m ready to answer any questions you have regarding your real estate needs.
Kathe Barge, CRS, ABR, CNE
Associate Broker
401 Broad Street
Sewickley, PA 15143
Cell: 412-779-6060
Office: 412-741-2200 x238
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Waiting for “Mr. Right”

Will there be more homes coming on the market soon? We’ve been looking for a while and it doesn’t seem like there are many homes available.

Our inventory of available homes has never been lower! And yes, there will be more homes coming on the market soon. I have many wonderful homes almost ready to enter the spring market – sellers working hard to make their home appealing to you. But don’t expect an avalanche – I fully anticipate that there will be fewer than usual homes coming on the market this spring. And with the coming of the spring market there will be many more buyers, much more competition, and a rise in the prices realized by sellers. The window is almost closed for buyers to be able to get a good deal this spring from a seller anxious to sell. Buyers will soon find themselves in bidding wars, in many cases for homes they could have purchased a month earlier at a discount.

Will your perfect home be one of the ones coming on the market in the coming weeks? There is always that chance, but if you are looking for that historically charming Village home that has 4 bedrooms, 3.5 baths, a two car garage with modern kitchen and baths, a gray/greige color palette, and a yard big enough for fun… get in line! There is a large crowd of people waiting for that product and you are well advised to be pre-approved by a lender and ready to put in a strong offer very quickly, with no guarantee you will be the winner. Another reasonable alternative is to reconsider what we have on the market – there are many terrific homes that with a little effort, could be your dream home.

Why is inventory so low? Here in Sewickley, our community’s popularity is growing every year. The school district continues to garner accolades and rank highly and the secret is out – this is a super cool and fun place to live that is really close to both Pittsburgh and the airport. Why not Sewickley? So as more people try to find a spot here and fewer people depart, fewer and fewer homes are available for sale. The scarcity of homes will continue to put upward pressure on prices. And of course, if your priority is a home in Sewickley, you may just need to consider where you can compromise to make your dream a reality!


[contact-form-7 id="115311" title="Get More Information Form"]
I’m ready to answer any questions you have regarding your real estate needs.
Kathe Barge, CRS, ABR, CNE, SRES
Associate Broker
401 Broad Street
Sewickley, PA 15143
Cell: 412-779-6060
Office: 412-741-2200 x238

Who Represents You?

Can we choose a buyer’s agent even if we have seen homes with the listing agents?

The answer is an unequivocal yes! As a buyer, you are absolutely entitled to choose your own representation in a transaction. It might be that the listing agent is in fact the individual that you feel will best represent you – approximately 1/3 of my transactions involve dual agency, and they proceed smoothly for all parties. But if you have been looking at homes or going to open houses and find the perfect agent for you in that process, it is fine to engage that agent as your representative even if you have seen homes with other agents.

It is of course in your best interests to ultimately select and work exclusively with a buyer’s agent. Your buyer’s agent should provide a personalized high level of service to you. When viewing homes, you should expect your buyer’s agent to provide you with information about the home, neighborhood and community to help you in your decision making process. You should expect your buyer’s agent to provide you with an analysis of comparable sales, develop a negotiating strategy and help you analyze and negotiate the home inspection. These are important benefits that you will receive when you engage a buyer’s agent that cannot be provided in the absence of that relationship.

Many buyers use open houses and viewings with listing agents as their opportunity to interview agents and determine who will best represent them as a buyer’s agent. This makes complete sense if you do not have a prior agency relationship that you were pleased with. Transitioning between homes is a very personal process that can, for some, also be very stressful. For many of us, it also involves the purchase and/or sale of our largest asset. The importance of due diligence, reference checking and interviews cannot be overstated when choosing your real estate representative, and once you have made that decision, it is important to communicate that to other real estate agents when interacting with them. I will be hosting an open house this Sunday, 1-3pm, at 30 Wilson Drive in Ben Avon Heights and next Sunday, February 5, 1-3 pm at 1008 Beaver Street in Sewickley – stop by, check out these amazing homes, and if you don’t already know me, I would love the opportunity to meet you!


[contact-form-7 id="115311" title="Get More Information Form"]
I’m ready to answer any questions you have regarding your real estate needs.
Kathe Barge, CRS, ABR, CNE, SRES
Associate Broker
401 Broad Street
Sewickley, PA 15143
Cell: 412-779-6060
Office: 412-741-2200 x238

The Million Dollar Question!

Do you have any thoughts as to how the election will affect our housing market?

That is the million dollar question these days!

The quick answer: in the long run, I don’t expect it will have any effect. Real estate is very local. What happens in one part of the country often has nothing to do with what happens elsewhere. Pittsburgh tends to be a more cautious market. Our prices don’t escalate quickly and they also didn’t plummet after the recession. We have seen a very slow and steady upswing in our prices and I expect that to continue – because it is slow and steady, as Pittsburgh has always been.

Our sales have, however, came to a near standstill in recent weeks. But the elections are over and we have a new President elect – so where does that leave us?

When it comes to the real estate market, it really doesn’t matter who you voted for or what you think of the election results – it is common when there is an anticipated change in leadership for our real estate market to slow down. And so I expect, as has happened in prior leadership change years, that our real estate sales will be very slow from now until after Inauguration Day. Cautious Pittsburghers will be interested to see who is chosen to fill cabinet positions and what plans are laid out for the coming years. Home purchases are a big event in most people’s lives and they will want a greater sense of certainty before they make a big change like a new home. And then I fully expect, as has been the case with other elections, that normalcy will return to our market.

Because I expect the next three months to be slow in real estate sales, I do expect that will lead to a pent up demand and a strong spring market. If you are thinking of selling, now is the perfect time to put together a plan for selling your house this spring. The election is over and you can be certain one thing will not change – I will still be here selling houses for you!

Why Buy Now?

Dear Kathe,

Why should we consider buying now? Isn’t it better to wait until spring?

This fall, the market has been a bit sluggish, perhaps led by election anxiety, and now the holidays are quickly approaching. We are, however, expecting a very strong spring market. The millennials are expected to make a huge impact on our housing market this spring. Over 50% of home purchases are projected to come from first time home buyers. Many millennials are moving into their first homes, many are moving out of apartments and/or out of cities to a more “family friendly” environment. Sewickley , a walking community that has become so very popular in millennium America, is well positioned to see the impact of that surge.

This expected demand is going to put incredible pressure on our spring market. It is anticipated that prices will be increasing and bidding wars will become commonplace. All of this suggests that now is the absolute best time to buy if you are thinking of moving! There are very few people who buy this time of year, as most are too preoccupied with getting ready for the holidays. While inventory is lower than it will likely be come spring, the absence of many buyers gives you a much better chance to strike a good deal. Why pay over asking price in a bidding war come March when you could negotiate a discount now? Rather than putting yourself at a competitive and financial disadvantage, start the home search process now.

And of course, if you are thinking of selling, carve out some time this fall to prepare yourself for a spring introduction in January/February. Market trends show that the sale surge happens in March, not April, so you should be getting ready now! If you will be selling a starter home (which here can be up to $500,000) and are well prepped and well priced, you should expect a positive market response and maybe even a bidding war!

The Credit Game

Dear Kathe,

How important is your credit score – what should I know about it?

Your credit score is more important than you might think! Many people never consider is how much their “not so great” credit is costing them.  Just a 100 point differential in a credit score, from a 720 to a 620 for example, could cost you in excess of $91,000 in additional interest fees paid on a $300,000 loan over the life of that loan!  That’s a lot of money to forego because of credit issues.

It is therefore well worth your time to understand what goes into credit, what makes your score go up or down, and how to positively influence your credit score.  Your payment history forms the largest part of the score.  Just one 30-day late payment can reduce your score a full 50 points!  Ouch!  Put your bills on auto-pay whenever possible and you will be making great progress toward avoiding this costly mistake!  If you miss one payment once, take the time to call the credit card company and beg them not to report it – most will forgive one late pay each year.

How much you currently owe on your credit cards is the second largest piece of the equation.  Ideally, you do not use more than 15% of your outstanding credit line, but in no event should you exceed 30%.  So, for example, if you have $10,000 in credit available to use, you should not be using more than $1500 – $3000 of that credit.  This number is easy enough to manipulate when you are planning on buying a home or refinancing – just refrain from charging in excess of 15% – 30% of the available credit line in the 6 – 12 months immediately preceding your mortgage application and you can positively impact your score.

Credit inquiries can also reduce your score – avoid applying for new credit cards or other loans during the months prior to your planned application.    Also avoid closing old lines of credit – having open but unused lines of credit will positively impact your credit utilization percentage.  When a credit card company chooses to increase your line of credit that also increases your score, but beware – if they decrease your line due to overuse or late payments, this can reduce your score as much as 100 points.

Lenders generally require scores to exceed 650 in order to obtain a loan at all, and the best rates go to borrowers with scores exceeding 760.  Even insurance companies look at credit scores these days and give the best rates to customers with the best credit.  There is simply no getting away from the impact your credit can have on your budget.  So do yourself a favor and take the time to monitor your own credit and understand how your choices impact your scores – you’ll thank yourself in the long run when you have more money left over to spend on the things you love!

Partnering for the Sale

Dear Kathe,

 Our home has been on the market for a while – we are getting a fair amount of traffic but so far, no offers. We are concerned that others are selling and ours is not. What are your thoughts?

 Selling a home is a partnership – a realtor cannot waive a magic wand and make a home sell. An agent’s initial primary job is to make sure that your home is well advertised and to provide honest advice and feedback about condition. If you are getting a reasonable amount of showings, then that’s a good sign that the marketing is working well. Hopefully, you have gotten feedback from these showing and have taken steps to overcome any perceived drawbacks. Some things can’t be overcome – if a buyer needs an extra bedroom or garage, there isn’t much to do about that, but if there are concerns that you can address, be sure that you do.

Take a quick tour of your home, invite a neighbor over for a look or visit other open houses to make sure your home is presenting as well as your competition. Take staging to a new level. If you have checked all of the typical boxes (no wallpaper, neutral carpets throughout, neutral paint, no clutter, removing personal items such as family photos and religious décor…) take the time to consider what else YOU can do to help improve the chances of an offer. If your rooms don’t look open and spacious, remove more items to a storage facility. Did you remember to clean your windows this spring? Dirty windows can make a home very dull inside. In this heat, have you been watering your landscaping so that it is alive and thriving? How about your lawn? Green or dead? Have you removed the signs of your own wear & tear – are switch plates and walls clean and smudge free? Have you de-cluttered too much making your home sterile? Pottery Barn is still the easiest look to sell—make sure that while your home is reasonably free of personal items such as family photos, it has some warmth – fluffy white towels in the bathrooms, attractive throw pillows on couches and beds… Unsure of what you need? Bring in a home stager for some professional advice. Remember, selling a home is team work – you need to be doing your part!

Finally, price must constantly be evaluated. Keep in mind the oldest rule of thumb in the book – 13 weeks or 13 showings – if you still don’t have an offer, its probably price. Yes, improving condition can improve price. But if you are getting the showings and you aren’t drawing an offer and can’t make significant changes to the home to overcome objections, you must reduce your price, or be very patient waiting for what could be years for that one buyer to come along.

Is It Really Love at First Sight?

It sometimes surprises me that homes which look great on paper – well priced, good condition – do not sell, and I often wonder why not?  After reviewing statistics, the question often remains.  All the data suggests that the home should have sold.  So why then is it not sold?  This can be a very difficult question for frustrated sellers and their agents.  Recent studies show that greater than 60% of buyers (both men and women) know whether a home is right for them the first time they walk in the door – they just have a “gut instinct.”    This is consistent with what I often tell home sellers – more often than not, people are guided by emotion in making their buying decisions and emotions are rarely something we as professionals can reduce to a clear-cut action plan.

What does this “emotional buying” mean for you, the home seller.  First and foremost, it means that “first impressions die hard” – you will probably only get one chance at a buyer.  Revisiting prospects later with news of a kitchen update, home staging or offer of a carpet allowance is usually a complete waste of time with respect to those buyers – they saw your home, had a negative gut reaction, and moved on.  The focus needs to be, instead, on buyers who have yet to have that “first impression.”

If you are not yet on the market, it drives home the message once again – the message I have been sharing for years now – it is critical to enter the market ready to create an emotional “wow.”  Partnering with a home stager, many of whom offer reasonably priced consultations, gives you the best chance of meeting current market expectations.  An experienced agent should be able to give you some suggestions as well.  Many of the basics I have covered in the past include:  remove all wallpaper and paint with a neutral color palate; replace colored wall-to-wall carpeting with neutrals or, if possible, remove entirely to expose hardwoods; declutter and remove personal effects.  The trick comes in not sterilizing décor too much – it’s important for the home to still create a warm and inviting feeling – just not one that feels too dated or too personal.  Feel free to give me a call if you would like advice on how to best create the “wow factor” in your home.

Do Your Floors Tell a Story?

Dear Kathe, 

We live in a somewhat dated home we would like to get ready to sell — we have older caret and flooring — an advice of what direction we should head in when updating?

These days, the trend in interior design is to unify interiors.  Flooring is seen as a base on which to build a room.  The most universally liked flooring style is one that remains the same throughout an entire level of a home.  Unlike the 70s & 80s, when the trend was to choose a floorcovering for each room, these days it is far more popular to just pick one (or at most two) per level.  You will therefore often find that the entire main level is hardwood.  The entire second level may also be hardwood, but it could also be a neutral unifying carpet.  The design scheme then builds off this neutral base, perhaps layering on area rugs to add personal style.

In light of these trends, nothing dates a home faster than if there are a multitude of different floor coverings on one level.  It could be that each bedroom has a different color carpet.  It could be that there are four different materials on the main level – tile in the kitchen, marble in the foyer, hardwood in the family room and carpet in the living and dining rooms.  These floors all tell a story – the person who chose them was seeking a specific look in each individual room.  Those days are gone, the person has likely moved on, but the floors still hint of stories past.  Interestingly, when buyers visit homes like these they cannot usually pinpoint what they don’t like – they just say “its not for me,” or maybe “its too dated.”  What they can’t usually put their finder on is that they are missing the harmony that generally comes from unified floor coverings.

What does this mean for you, the home owner?  As you update your home, keep your floor coverings uniform throughout a level (up to two choices per level are usually ok).

My Crystal Ball is Out for Repair!

Dear Kathe,

How much more “life” do you think our spring market has left in it?

My crystal ball is out being repaired so I’m afraid my response will need to be a best guess, without it’s reliable aid! In all honesty, what the market is or is not doing in a given week or season is never more than a guess. There are certain norms that we have come to count on: the spring market is stronger than the fall market; homes in the Village sell faster than homes “up the hill,” which often require more patience. But being able to predict how long buyers will continue buying in any season, or how many buyers companies may transfer in, or how many buyers will accept the jobs they are offered and actually come to Pittsburgh, choosing Sewickley as their home base, is impossible to predict with any certainty.

And of course, there is the added uncertainty of what impact a Presidential election has on our market – historically it often slows around election time. It’s been a strong spring market. Buyers have come in waves – there was a huge surge in the March. Sales have been strong in certain brackets and not in others, but that could change on a dime. We saw a small surge “up the hill” but that market has quieted again.

To answer your question, I expect sales to continue along their usual patterns, with a reasonable number of sales in June and some in July as well. We are in our final push of families who need to be in for the school year. I expect that things will slow as they always do in August when most people desert Sewickley! Usually things pick back up again in October. If your home hasn’t sold yet, there is still a chance it could sell this spring, particularly if its well conditioned and priced perfectly. If you are thinking about listing in the future, it’s the perfect time to give me a call and develop a strategic plan for entering the market in the months to come!

Where Did All the Color Go?

Dear Kathe,

Why does it seem that almost every home we view online is so neutral? What happened to all the color?

 I recently reviewed a portion of a local market in the mid-price ranges and interestingly, almost every home that is under agreement has zero wallpaper and is painted in a neutral color palate (including beiges, grays, greiges and a few other nearly neutral tones). Only one of these homes had any true color on its walls, and that home took nearly a year and several price drops to go under agreement.

Professional home stagers have been counseling for years to remove all wallpaper before putting your home on the market –asking someone to buy a home with wallpaper is as personal as asking them to buy someone else’s wedding dress. No matter how beautiful, it’s rarely done and appeals to very few. Stagers are also quick to recommend neutralizing your paint palate. While there are some warmer neutrals, these days the cooler neutrals like gray and greige are the more popular tones with the buying public. Even having a more colorful child’s room can be a big turnoff.

It seems the selling public has in large part heeded this advice. The homes that are actually selling for the most part have been stripped of their wallpaper and painted in a more current, more neutral paint palate. Absent a compelling reason to choose a home that is not “sale ready” such as a severely discounted price, buyers are far more likely to overlook other “road blocks” to a sale such as a lack of a garage than they are to look past a personalized and colorful decorating scheme.

Does this mean that we must all live in color-free homes? Of course not! Your home should reflect your personality and your personal furnishings undoubtedly tie your color choices together. But it is important when we move toward a customized design scheme to remember that when its time to sell, part of the cost of selling will be repainting these spaces back to a more neutral palate!

Pocket Listings — Are They For You?

Dear Kathe, 

We have noticed that several homes have sold lately before they have hit the MLS. Are these “pocket listings” a good way to sell your home?

If a home sells before it hits the MLS, as a “pocket listing” as they are often called, it is highly likely that the seller could have sold the home for significantly more money. The MLS exposes a home to a large number of prospective buyers in a very short amount of time. This widespread exposure is what has the potential to drive the price up for the seller.

A “pocket listing” is more like a secret sale. The agent you are dealing with may have a buyer that is willing to buy your home, but if it’s that easy, chances are you could have received more money if the general public had a chance at your home, and a bidding war could have possibly ensued. If an agent is being straightforward with the seller and discusses the strategies involved with using the market pressure of the MLS to drive in a higher price, it’s a rare seller who will willingly leave money on the table.

So why do we occasionally see these seemingly “secret sales” taking place? Some sellers perceive these pocket listings as a good thing – some don’t want to be hassled with multiple showings, some don’t want the general public to know their home is available for sale. Some agents choose this strategy because they want to keep all of the commission for themselves and that only happens if their own buyer is the successful bidder. If a seller’s goal is to maximize financial return, however, a pocket listing, or accepting an agreement of sale before the home is marketed in the MLS, is rarely the best strategy.

So no, my 17 years experience indicates that a pocket listing is usually not in a seller’s best interests. The highest returns I have seen sellers achieve occur in scenarios when they have used strategies to maximize the excitement within the buying community through proper pricing, excellent conditioning and staging and full MLS exposure.

The Pace of the Sale

Dear Kathe,

Why do some homes seem to fly off the market and others take years to sell?

Location. Price. Condition. These are the three most important factors that go into how long a home is on the market. Unique attributes and depth of market segment would be fourth and fifth!

Location is really where it all begins. If your home is in an easy to sell location, the market will be far more tolerant of imperfections in other areas, such as wallpaper or a slightly aggressive price. Location is sometimes relative to a particular buyer – their work address may make one part of town more desirable than another, but generally speaking, buyer excitement about properties rises and falls with address.

Condition is also a very important factor in pricing. Homes that look like they are straight from the pages of a Pottery Barn catalog tend to sell more quickly, and tend to bear higher prices than are sometimes warranted. Those that are dated, with older wallpaper and carpeting, for example, tend to sit – unless, of course, they are in a hot location and deeply discounted, in which case our stable of “flippers” will be ready to buy with cash and close quick for the opportunity at a profit when they renovate.

Price is the easiest of all factors to change. If priced well, even less popular locations and homes that have condition challenges can sell quickly. But if you are trying to match the price of competing sales that were in better locations, better condition or with more amenities, you may find your home takes far longer to sell.

Finally, you may have a home with unique features. A home with no off-street parking can be a challenge to sell at any price point, and it is a matter of being patient and waiting for the right buyer who appreciates the home’s other attributes. You may not have a master bathroom. You may not have any green space in your “yard.” You may have a kitchen barely big enough for one. You may have only two bedrooms. There are many factors that could lengthen time on the market even with perfect condition and price. And of course, depth of the market segment is relevant as well. The higher you go in price, the fewer qualified buyers there will be and the longer your home will take to sell.

My Magic Wand

Dear Kathe,

Our home is on the market and not sold – where are the buyers this spring? How can we get it sold?

 Our spring market has seen some very unusual fluctuations.  In some weeks there have been surges, with several houses going under agreement in a week, and other weeks have been quiet.  The one million dollar price range has been hot for the first time in a couple of years.  The under $300,000 market is also moving very well.  If you’re home is in the “middle” then yes, it’s been slower than expected and it’s hard to know why.  Speculation has included the election, of course, as well as cutbacks in some oil and gas companies.

Sadly, real estate agents don’t have magic wands that we can wave to make a buyer appear for your home.  If it’s been on the market for more than a few weeks it’s likely the local prospects have seen it and determined that its not a fit for them.  The most likely buyer is someone currently outside the area, and there is just no predicting when a company is going to relocate someone who might be looking for a home.

 Therefore, what you must do is make sure it is the best choice in the price range when a buyer does arrive on the scene.  It is important to make sure that it shows perfectly – there is a lot of competition – other sellers who really want a buyer as well.  I have written many articles that you can find on my blog at that cover critical topics like de-cluttering and staging, and updating your home.  It might be time to bring in a professional stager.  It might be time to update paint colors, freshen any dated carpets, update lighting fixtures or baths. Many of these things can be done very cost effectively and could give your home the edge with the next buyer through town.

 It may also be time to have a professional appraisal done of your home, both to check to make sure that you have it priced competitively and to give any buyer prospects confidence that the value is there.

 In the end, homes with completely updated features and current design palates continue to be the first ones to sell.  If that’s not your home and changes aren’t possible, then review price, do the best you can to stage and de-clutter, and then be patient.  Buyers can be very fickle – your buyer will come!

Should It Stay or Should It Go?

Dear Kathe, 

My mother recently passed leaving me and my brother a well-maintained but not updated house built in 1960.  It’s full of furniture that is clean but bulky and out of style and almond-colored appliances that work fine but are 20-30 years old and don’t match. We plan to sell the house.  My brother thinks the house will sell better if it has some furniture and appliances in it; I think it would sell better with empty rooms (it has beautiful hardwood and tile floors that have been covered with carpet since the day they were built) and the distracting appliances removed. What would you advise?

First, you absolutely must empty the home – these days young buyers want Pottery Barn, not grandma and grandpa’s house.  Buyers also do not respond well when personal effects of a decedent remain behind after they are gone – so it’s important that it be completely empty before anyone tours the home.

Second, any old carpet should be removed. If there are hardwood floors underneath, that is what buyers want these days and you will do far better in your realized price if the floors are fully exposed. If they are not in good shape, it is possible to buy a Bruce product at the hardware store that does an acceptable job making them look presentable and is easily mopped on.

You must have a stove in the house in order for the buyer to get a mortgage. Therefore, you either need to keep the old one or buy a new one.  Refrigerators, however, do not need to be retained and you may be able to get a credit for turning an inefficient old refrigerator in.

I would also recommend that you and your brother have the home pre-inspected and appraised in order to make the selling process as smooth as possible!

The Cost to Close

Dear Kathe,
Is a seller expected to help pay for the buyer’s closing costs and if so, how much?

Sellers often contribute to buyers’ closing costs in lower price ranges and in first time home buyer situations. Typically buyer closing costs are not less 3% of the cost of the home and may be as much s 6%. Buyer closing costs include expenses such as transfer taxes (1%), lender fees, title insurance, property tax proration, homeowners’ insurance premiums and pre-paid mortgage interest. These fees can add up quickly. Sometimes buyers do not have enough cash saved to be able to pay their required down payment and their closing costs as well. They may be very well qualified to buy in that their salary is high enough to afford the monthly payment, but they just don’t have enough cash saved.

When this happens, buyers will look to sellers for help in paying the closing costs that the buyer would normally have paid. This is normally expressed as a percentage of the purchase price. For example, the buyer might ask the seller to pay 3% of the purchase price toward their closing costs. The seller is automatically netting 3% less in this scenario, before they pay their own closing costs which normally range between 7% – 8% of the sales price.

Before you jump to the conclusion that sellers often won’t agree to contribute toward a buyer’s closing costs, stop and look at the greater picture. Normally sellers who help with closing costs are receiving 100% (or very close to that) of their asking price. On the other hand, it’s a rare day that any listing sells for 100% of its asking price, and the average “realization” before seller expenses in Quaker Valley School District is less than 90%. So paying 3% in closing cost assistance but getting a 100% (or close) offer might be your best deal!

Where Did They Get THAT Price!?

Dear Kathe,

How do we decide how to price our home? We know buyers like to negotiate!

Deciding on an asking price is a challenging task, particularly in Sewickley.  Interestingly, in Pittsburgh’s North Hills, sellers realize much closer to their asking price, often 97% and higher.  However, if a property is overpriced in the North Hills, buyers will simply write the property off – low-ball offers are not made.  In Sewickley, however, we have developed the unique tradition of negotiating fairly heavily on the sale of a home.  In prior years, the average realization was only 89% and offers often start as low as 80% below asking price.  So how is a seller to price a property?  If a seller prices 20% over the price a home is likely to sell for to allow for negotiating, it is likely to be seen as “overpriced.”  If the seller prices only 2% over likely sales prices, many buyers will factor in the large discounts we often see and bring in inappropriately low offers.  Developing a strategy for both pricing and marketing is therefore critical to make sure that a home is both well received and does not sit and get stale on the market.

If you’re facing a deadline due to job relocation or other reasons, then you need to price competitively, even more competitively than expected in today’s market.  You’ll need to list at significantly less than your competition.  And keep your commission higher as an incentive for a quicker offer.  That may seem tough to stomach, but it’s better than continuing your monthly loan payments or the hassle of trying to find tenants to rent your home and of being a landlord for a year or more.

If your home has been listed for some time, but not generating interest, you may need to lower your price.  Of the three elements that sell a home – price, location, and condition – price is the one you’ll have the most control over.  Review your listing company’s programs and marketing, making sure that you are taking advantage of all of them.

Make sure your home shows better than its competition.  Its condition should outshine all of the other listings in its price range.  Take time to de-clutter, store off site what you can live without, stage and make sure you attend to all of the little maintenance projects you may have been putting off.

In the end, Sewickley statistics show that if your home does not have an agreement on it within 75 days of the listing date, you will not achieve 90% or more of your original asking price.  This makes the original list price a critical decision and also makes it clear that after 75 days, it is absolutely essential to reevaluate your price in light of market feedback and price.

The Long Wait Until Closing

Continuing from last week:

Dear Kathe,

We’re first time home buyers – where do we begin? 

At this point in our journey to your new home, hopefully you have resolved any home inspection issues that you have and your financing is in process.

There are many pieces to the home financing puzzle that you will not see and some that you will.  Financing has gotten quite tight now and you will need to be prepared for a high level of documentation required by the lender.  They may ask you to document sources of deposits.  They may ask you to document other expenses you are responsible for.  They may need copies of letters of employment or bonus guarantee letters.  Be prepared to respond quickly to any and all requests.  While you are addressing these requests, the lender will order an appraisal to confirm value of the home.  There is a range of reasonable in which a home may sell – the lender is simply trying to make sure that you are in that range.

Once your loan is approved you begin the long wait until closing.  If you had a particularly delayed closing, you will begin to wonder if you are supposed to be doing something else.  The next steps happen right before closing.  You will set up your insurance coverage on the home with your insurance agent a few weeks in advance.  Coverage options vary widely so you will want to work with an insurance agent who will thoroughly review all of your options with you.  About a week before, you will need to call the utility companies to move the utility bills to your name.  If you forget to do this, the utilities will simply be turned off and it will cost you more to get them turned back on again.  For water and sewer, you will need to show up in person to get them connected, so be sure to schedule that in to your work schedule.  Finally, the day before closing you will do your walk through to make sure the home is as you expected it would be.  If the seller accidentally removed something you thought was to remain or forgot to make a requested repair, now is the time to raise those issues.  Once you close, so does your window of opportunity to resolve any last minute concerns with the seller.

On the day of the closing, you will spend about an hour signing many documents and presenting a cashier’s check for any balance you owe above and beyond the mortgage.  Once that is completed, you will receive the keys and may begin the happy process of unpacking into your new home!

Negotiations Begin!

Continuing from last week:

Dear Kathe,

We’re first time home buyers – where do we begin? 

If you’re following along each week, by now you have been pre-approved for a loan, selected a Buyer’s Agent, looked at and selected a Property, made an offer and are negotiating for your new home!

The process of negotiating for a home is one of give and take.  Your Buyer’s Agent should be able to explain negotiating norms in the areas in which you are interested.  For example, in our North Hills communities, Sellers price their homes more tightly and they generally sell in the range of 98% of list price.  If you bring an offer at 90% of list price, you may not even get a response.  In Sewickley, there is often a bit more flexibility.  Keep in mind, however, that price isn’t the only concern.  Closing date is important – if you can’t get the date you want, you may need to pay for temporary housing and storage of your things.  Inclusions are important – if a Seller starts removing things from the home, they are things you may need to spend money to replace and this may affect what you are willing to pay for the home.  You must keep all of this in mind as you try to negotiate to a final Agreement to purchase the home.

Once you and the seller reach a deal, both parties sign the Agreement and you are officially “under agreement.”  At this point, the contract takes over and specifies exactly what you must do next.  Your Buyer’s Agent should lay all of this out for you in easy-to-use timelines.  This is absolutely critical – if you miss deadlines, you could lose your deposit money in some scenarios.  You generally have 1-2 weeks to apply for a mortgage.  Do not delay.  The lending process is quite complex these days – there will be a lot of detailed information requested – this will take you time to compile.

At the exact same time that you are applying for your mortgage, you will also be inspecting your new home (yes, it will be very busy for a few weeks).  More on inspections next week…

Get Thee to a Buyer’s Agent

Continuing from last week:

We’re first time home buyers – where do we begin? 

Hopefully after reading my article last week, you were motivated to get serious about buying a home and began the process.  As I discussed last week, you should be saving your down payment, keeping your credit in excellent shape, getting pre-approved by a recommended lender and researching and selecting a Buyer’s Agent.  So what’s next.? The fun begins!

Your Buyer’s Agent should set you up to receive new listings via email as soon as they become available.  To streamline the process, it is a good idea for you to pre-screen these homes before going to see them.  Check them out online and on google earth, do a drive by to make sure there is nothing that you would object to that is readily apparent.  Once you have done your initial screening, go to see the home as soon as possible.  Our inventory is at record lows.  If you love a home you can be sure that there are at least a dozen other buyers considering the home and you will need to be ready to make an immediate offer.  Along these lines, it is important that you have developed a relationship with your Buyer’s Agent and trust her judgment.  When the right home becomes available you may have to pay full price to get it, and you need to be working with someone you feel you can trust on those decisions.  In this market there is rarely time to test out the seller if it is a great house and is well priced.

When making the offer, allow about 2 hours to go over the contract with your Buyer’s Agent.  You will want your agent to review the details with you and there are many decisions you will need to make when writing the offer.

You will need to work with your agent to decide how much to offer initially, how much hand money to put down, a closing date, the mortgage terms you plan to apply for and time periods for inspections.  You will list the items that are in the house that you expect to stay there, such as dishwashers, refrigerators and window treatments.  There are many other custom terms you may want to include – you may want to include an appraisal contingency.  You may be looking for the seller to address certain deficiencies that you noted while walking through, such as cleaning gutters.  All of the things that are important to you about the home must be written into the contract or they will not happen in the future.  Oral agreements are not binding when it comes to the sale of property.  Your Buyer’s Agent has hopefully paid close attention to everything you noted while viewing the home and will make sure that the Offer reflects all of your wishes.

Once you have signed the offer (and no, you can’t just make a verbal offer – as mentioned above, everything concerning land must be in writing) the offer will be presented to the seller and you will begin negotiations with your seller.  Stay tuned as the process of buying your home continues to unfold next week…


Is There Such a Thing as “As Is”?

Dear Kathe,

We would like to sell our home “as is”and avoid the hassle of repair negotiations.  How do we do that?

“As Is.” The statement comes up more often than you might imagine.  Negotiations commence on a home and frequently, sellers are not able to achieve their hoped for sales price.  With a sales price lower than imagined, sellers often assert “well then they are buying it AS IS.”  Quite a bold statement – is that really possible?

Put on the buyer’s hat for a moment.  When  buyers agree on a price to buy a home, they are assuming that all is in good order unless it is something obvious to them when they  saw the home or it was on the Disclosure.   If an inspection discloses major problems, how can the home possibly be worth what they had offered?   For example, if the inspection shows the furnace needs to be replaced, how could the home possibly be worth what it was worth when it was believed that the home had a working furnace?  Quite simply, it’s not.  Suggesting that a buyer will need to take the home “as is”  implies that the seller is hiding something – that there are problems that could drive the price down further when discovered.

So what’s a seller to do if he doesn’t want to get stuck footing major inspection repair bills?  The two best options are the seller disclosure and a pre-inspection.  It is wise to disclose absolutely everything that could possibly come up – your agent should be able to review the disclosure in detail with you and make certain that you aren’t forgetting things that could come up on an inspection.  A pre-inspection is also critical for any seller who is inclined toward trying to sell “as is.”  A buyer needs a fair opportunity to determine what the “as is” condition is and a pre-inspection is a critical piece of that puzzle.  All conditions disclosed on the disclosure or in the pre-inspection can be excluded from the buyer’s  inspection, dramatically decreasing the chance that there will be any surprises on the buyer’s inspection that the seller will be asked to pay for and significantly increasing the seller’s likelihood of achieving the illusive “as is” sale.

What Comes First – the Chicken or the Egg?

Dear Kathe,

 We are thinking about moving this spring but have a home to sell – should we find our new home first or sell our current home first?


If you are considering a move but have a home to sell, then you may find yourself in a common predicament – do you buy first or sell first?

If you buy first, you may face the reality of owning two homes at once, which could require a lot of belt tightening (and cutting back on coffee runs!)  While we have a shortage of inventory and well-priced, well-conditioned homes are moving well, there is still a risk that you may carry two homes for a while (our strongest market period will begin again in early 2015).  Of course, buying first allows you to lock in a home you really love.

If you sell first, you don’t have the financial risk of carrying two homes.  But there is a possibility that you may be unable to find a home you love when yours sells, and be faced with temporary housing for a while.  This may be the lesser of two evils, if you achieve a sales price on your home that you are happy with.  And of course, you may have no choice – your lender may require you to sell before you buy.

There is the option of making a contingent offer on a home you like, and we now have the “right to continue marketing” option for this contingency that makes a seller more willing to consider such a contingency.  However, the stigma of a home sale contingency still stands and many sellers will not entertain this option.

Perhaps the best avenue is to list your home after the holidays and start looking for your new home.  Once your home is under contract, you will probably have a good sense of what is available to buy and hopefully have isolated a couple of top choices.  At that point you will be ready to make your offer and get moving!  Fell free to give me a call and we can design a strategy that suits your specific needs!

Should You Pre-Inspect?

Dear Kathe,

A friend in California tells me that all home sellers pre-inspect their homes before listing them, but that’s not something I hear a lot about here in Pittsburgh. Do you recommend a pre-inspection to home sellers?


Issues with a home uncovered on an inspection often cost a seller thousands in unexpected repairs and can sometimes even result in a terminated transaction.  Inspectors are incredibly thorough (sometimes even finding problems that aren’t problems) and so every home seller should anticipate that the home inspector will find deficiencies and that the buyer will expect correction.  To make the home selling process as smooth as possible and avoid finding themselves in the position of having large inspection bills or worse yet, a “dead deal,” sellers can have their home pre-inspected.

All home sellers should seriously consider having their homes pre-inspected.  For as little as $350 – $500 for a basic pre-inspection you will quickly have an insiders view of how a buyer’s inspector will assess your home.  Use the inspection as a maintenance check list – find a handyman to come in and fix all of the little things so that they don’t come up again on a buyer’s inspection.  If there are larger items that you do not have the ability to repair, such as a roof nearing the end of its useful life, get an estimate or two for the repair or replacement.  Note the issue on your disclosure and include a copy of the estimate.  This should prevent you from having to credit the buyer for the repair later – buyers should review the disclosure and take any disclosed items into account in making their offer to you.

Of course, if your inspection is good or just has a lot of little items that a handyman can fix, attach the handyman’s receipt showing the repair and provide a copy of the inspection in the house for buyers to see with a note indicating that the home has been pre-inspected and repaired and that they buyer can buy with confidence knowing that they are buying a house in great shape!  In a town full of older and aging homes, this will really help your marketing!

So before you list your home – yes, you should consider a pre-inspection.  It will give buyers the confidence they need to move ahead with a purchase, may combat concerns that there are likely problems that would lower their initial offer to you, and will hopefully result in  a smooth transaction once you do have your home under agreement.

To Stage or Not to Stage

Dear Kathe:

I’ve heard a lot about having my home professionally staged – I think my home is well decorated – is it something I need to do?

 Home staging is more about marketing a home and less about interior design. Your home could be beautifully decorated and poorly staged. The distinction is critical if your main focus is getting your home sold. Interior design is often about creating a home that reflects you personally and showcases your personal effects. Home staging is about decluttering, neutralizing and showing off your home’s best qualities. It is after all, your home that you are selling, and not your stuff!

Home staging consultations generally cost less than $200 and are well worth the investment when you consider the size of the asset you are selling and your hoped for gains. Home stagers often stage hundreds of homes each year and are very familiar with how to tweak a home to make it as appealing as possible to today’s buyers. We’ve all heard stories about home sellers in California who pack their entire homes up and bring in a new home of rented furniture to stage the home to sell. Home staging does not have to involve renting expensive furniture. It is sometimes an excellent idea however—if you bought your “dream home” and didn’t have time to furnish it with furniture appropriate to the home’s value, for example, renting furniture is likely a sound investment and will give the home the feeling that it is of a higher caliber. Most of the time, however, a home stager will work with what you have, although some of it may find its way into storage for the duration!

Offended at the concept of stripping your decorating from your home? It is important to keep your end goal in mind – you are moving. This is not about impressing the garden club ladies! It’s about showcasing your home so that prospective buyers appreciate all that it has to offer. A home’s positive attributes are often missed buyers when they are too busy focusing on your stuff. Whether they like your stuff or not, you want them admiring your home – not what you have in it. Home staging is designed to make your home – that which you intend to leave behind – sparkle – a stager eliminates, rearranges and augments to enhance the impression buyers have of your home. So yes, no matter how beautiful your décor, I strongly recommend a home stager, and working with your agent as you implement what she recommends!

How Important is Technology?

What are quickly changing world we live in!  You probably haven’t stopped to reflect upon the fact that just over ten years ago, real estate was still being sold from those big books that looked like phone books.  We agents would flip through the pages in search of prospective homes for our buyers and listing agents had to get creative to get the word out about new listings while we waited for the next addition of the book to arrive!

Today, 90% of buyers use the internet to shop for their new home.  While more buyers (40%) found the home they eventually purchased through their agent as opposed to finding it themselves on the internet (35%), most buyers actually started their search on the internet several weeks before contacting an agent.

The availability of information to home buyers has slowed down the home search process – the opposite of what you might have guessed.  Because there is so much information that buyers can discover about homes on the internet, the typical home search has nearly doubled in length as buyers take time to do their due diligence.

While Buyers rank Realtor’s as the most useful source of information (81%), Buyers are heavily influenced by the materials available on the internet about a home. Among the most important items buyers seek and expect to fin on potential listings are multiple photos (84%), detailed property information (82%) and virtual tours (63%).

What does this mean for you when you plan to sell?  Gone are the days when a sign in the yard is all you needed.  In order to stack up well against competing listings, your home needs to present well to prospective buyers on the internet.  Wonderful photos, a lot of relevant and helpful information and a visual tour are all key in drawing buyers to your home and maintain their interest long enough to request a showing.  So before you list your home, check out your prospective agent’s other listings and see how they stack up against the competition.  Make sure you trust your home sale to an agent who is using technology to your best advantage

Make More Money! Watch TV!

If you follow my column, you have undoubtedly noted my near-weekly mention that our market is hot and our inventory has never been lower.  It certainly couldn’t be a better time to sell.  You may in fact have just heard that your neighbor’s home sold for top dollar in record time.  How do you make that happen?  Start by watching more TV!

Surprising advice, perhaps, but TV sets our style expectations and our aspirations of how we want to live our lives.  Your potential buyer is watching TV and then coming to your home and expecting to see what the saw on TV.  Want to make the most money?  Meet their expectations!

This is easy to do if you also watch a healthy dose of HGTV .  There you will quickly find the latest trends and tips on how to achieve them in a cost-effective manner.  You will see what home designers are pushing and know what buyers will be looking for in your home.  House Hunters is a particularly good show to learn from.  You will get insight into buyers’ thought processes – you will get listen in on their conversations and take note of the factors that affect them in both  positive and negative ways.  Armed with this information, you will be ready to spring into action and create a home that buyers are instantly attracted to.  And why are they attracted?  Because they saw it on TV!

As a full-time real estate broker, every day my job lives like an episode on House Hunters.  Through countless hours listening to my clients as they evaluate potential homes, I am easily able see how HGTV has greatly impacted the home selling process.  Those sellers who choose to take to heart the lessons espoused on HGTV are rewarded with more money in less time.  They create instant attraction by making their homes appear as if they were pulled straight from an episode of HGTV.   So whether you plan to sell next month or next year, start watching more TV, put the advice into action and pocket more money when you sell!

Your Dream Home Awaits You!

The warm weather is waking up the dreamer in all of us it seems! Thankfully, we all have a different idea of the perfect home, which keeps our market moving twelve months a year.   Buyers are not all waiting for that one special home.  They are waiting for their special home – but special comes in so many different shapes and sizes.  Nonetheless, when thinking of selling, you will have a much better chance of selling your home quickly and at a higher price if you improve and decorate your home in a way that appeals to more buyers.  Most homeowners settle into their cozy homes and forget all about trends and what’s hot in the market, and so it often comes as a shock when its time to sell and they have fallen behind the times in either amenities or style.

Want to know what’s in style with today’s home buying crowd?  Pick up a Pottery Barn or Restoration Hardware catalog and that will give you a quick lesson on color palates and designs that are “in.”  Of course, the lower you price your home, the further you can stray from current trends and still capture a buyer.  But assuming you are like most of my clients, it’s sometimes easier to inventory what’s “out.” As realtors, this is a difficult message to share with your clients – the message is not that you do not have a lovely home.  But in selling homes, one must first accept that you are leaving that home and then seek to minimize potential buyer objections while maximizing the “wow” factor.

With that in mind, here is my 2014 short list of the “gotta gos” – if you have these in your home, you are well advised to invest to sell:  brass anything (particularly lights, knobs & plumbing fixtures), non-neutral carpeting, shag carpeting, wallpaper (unless applied sparingly and in the last 5 years), bold paint colors (except used sparingly), stained woodwork (except in dens), paneling, dated lighting fixtures, non-neutral bathroom tiles and tubs, wooden toilet seats, linoleum flooring (except in lower price brackets) and formica countertops (except in lower price points).

Looking for inspiration?  It’s your lucky day!  The Sewickley House Tour is just two weeks away.  Its theme this year is Your Dream Home Tour – for just $35 you can tour seven amazing homes on Friday, May 2nd, Saturday, May 3rd, or both (ticket is good for both days) and be inspired by the unique vision of each of these seven homeowners!  And all proceeds benefit children’s causes in Western Pennsylvania! Tickets can be purchased in Sewickley at the library, Dollar Bank, Sewickley BMW, Penguin Bookshop and Jewel Thief.  Don’t wait! Quantities are limited! And while none of these seven homes are for sale, they will surely inspire you to go home and recreate your dream home, or start your search to buy a new one!

Trends in Real Estate We Can All Be Thankful For

Trends in real estate come and go just like trends in clothing and interior design.  Not so long ago we were, as a country, swept up in a trend of “no doc, no money down” loans that cost most of us mightily as we trudged through the recession.  This trend was reasonably short lived, thankfully, but certainly caused extensive damage in its wake.  Trends in real estate are looking up, at least in my opinion:

The trend in financing is that buyers must actually have a downpayment, a job and good credit to buy a home.  Seem onerous?  It’s the way it was until just a few years ago and provides a far stronger base for the housing segment of our economy.  We should all be thankful for the tighter lending practices in place that will hopefully help prevent another housing bust.

The trend in borrowing generally is to no longer treat your home as an ATM.  Yes, your home is an investment, and someday may provide a nest egg for retirement, but we have all learned the valuable lesson that we cannot expect our home to finance our cars, trips and children’s education – unless we want to be homeless, that is.  Good old savings toward goals is back in fashion!  The financial planners  I know are celebrating this trend!

Lenders are also moving more quickly on short sales, and this is also a trend we should be grateful for.  When a homeowner becomes upside down on a home, its important to move through the sale quickly so that everyone involved can get on with their lives.

The trend toward green building is also an exciting change in our market.  Many builders are choosing more sustainable and/or healthier building products, which is good for our environment and for our health.

Finally, we have all enjoyed and benefitted from the trend toward low interest rates, which remain at historic lows.  It remains a good time to buy your next home, where you and your family can enjoy Thanksgivings for years to come!

Design Trends

It is not possible to overstate the importance of consistency in design when selling a home.  Buyers uniformly respond favorably when a home flows in a consistent “theme” through the home.  What does this really mean? In an ideal world, your color palate would move smoothly from room to room.  Every room does not have to be the same color, but the colors should harmonize.  In other words, you should not be using both the 1980s burgundy & green palate along with today’s grays and browns in the same home.  As soon as you begin to move a newer color palate in, the old one must disappear completely.

Smaller details must also blend seamlessly.  If you like the nickel and chrome (silver based) colors, use them throughout for cabinet knobs, lighting and bathroom/kitchen fixtures.  Do not choose nickel form one bath and brass for the next. Buyers will subconsciously feel the home needs work as they will sense the lack of consistency.  The same is true for the bathrooms themselves.  If you decide to renovate your master bath, that does not mean you need to renovate every bath, but you would be well-advised to plan your master bath so it also harmonizes with what is already in your home.  If the “hardscapes” in your baths (counters, floors) are in the beige family, it would be a bad idea to do your master in white carerra marble, no matter how “in” that might be, unless you are prepared to update all baths.  Choose instead travertine, beige granite or a beige based marble that will blend more smoothly with your existing baths.  The impact to a buyer of “wonderful new master bath” will have the added benefit of helping to harmonize the entire home and will make the entire home feel more updated.

If you are looking for some bang from your bucks, keep in mind that design has historically flowed downhill in real estate.  The latest and greatest usually starts in the luxury home market and trickles down to other market segments as more affordable versions become available.  You as a homeowner can create a more long-lasting design statement in your home by considering the most recent trends in luxury homes – imitating those trends will make your home feel “current” longer (and drive in a higher prices should you choose to sell it).

According to Trulia Trends, marble baths, marble floors, floor to ceiling windows, wine rooms, log-burning fireplaces, outdoor kitchens and home gyms are all on their way up.  If you are considering a home improvement project, you should keep these things in mind when choosing your amenities.  If you can work in a couple of trends seen in luxury home magazines it will make your home all the more exciting to potential buyers, driving in a higher price and a faster sale.

The Easy Way Out

Once you have lived long enough, you realize that if there is something to be done, there is usually an easy way and a hard way.  When it comes to selling your home, why not make it easy? If you make it easy, you are far likelier to have a successful transaction.

First and foremost, make access to your home easy for buyers.  Use a lockbox and always be ready to show.  Busy agents with serious buyers don’t have time to track down keys held by listing agents, or worse yet, schedule showings around your listing agent’s schedule.  You can’t sell if you don’t show – make it easy with lockbox access (which notifies your agent immediately every time it is accessed) and be ready to accommodate last minute showing requests.

Make negotiations easy.  When you do receive an offer, do not get upset or offended.  Every buyer approaches negotiations differently.  Some will need to give you long letters explaining their analysis of value.  Don’t take it personally – just understand that it is a unique opportunity to understand how buyers perceive your home.  If one buyer is bold enough to tell you, the chances are there are others with the same concerns.  While you likely put your heart into the home, you are leaving and need to detach.  Be pleasant and non-defensive in your response and try to focus on the one or two points in the offer that concern you the most.  The more flexible and good-natured you appear, the easier it will be to get and keep the buyer in the deal.  Be easy to reach during negotiations as well.  The more protracted the negotiations, the greater the chance the buyer’s interest will wane and you will lose the deal.

Make inspections easy.  I have said this many, many times, but if there are conditions that exist that are called out by the inspector and they were not on your disclosure, you should expect to pay for them or lose your deal.  You can make this very easy on both you and the buyer – have your home pre-inspected – then a buyer can make an offer knowing the condition at the time of offer and you should sail through the inspection.

Sound easy?  It is!  Keeping these simple concepts in mind will make your home sale much easier.

The “Hot Potato”

Who can forget the old childhood game – pass the hot potato?  The object, of course, was to not be holding the hot potato when the music stops.  We have our fair share of “hot potatoes” in real estate too, and just like in the childhood game, someone always gets stuck holding the hot potato.

You may wonder, what are these hot potatoes of which I write?  Years ago, it was radon.  If you were selling your home and it had radon levels in excess of the EPA limit of 4.0 pCi/L, you got stuck paying the remediation bill (usually less than $1000) because a buyer isn’t going to agree to buy a home with a radon problem.  That hasn’t changed, but if a home has sold in recent years and ever had radon, chances are it has been remediated.

Next, the media exploded with stories of illness caused by mold in homes and suddenly, sellers were faced with mold inspections.  There is the very bad black mold (Stachybotrs), but honestly, all molds have the potential to make you sick.  As you can imagine, buyers aren’t going to buy a home with a mold problem either, and once again, the seller bears the cost of remediation and often, the cost to solve the cause of the mold problem as well. The cost can be several hundred to several thousand dollars.

These days, the hot potatoes have expanded to include two tricky electrical issues.  Pushmatic electrical panel boxes are very expensive to maintain and the manufacturer is no longer in business.  Most buyers will require a seller to replace these panel boxes – the cost per panel is generally $1500+.  Knob and tube wiring is the other big hot potato for homes built before 1930.  Rewiring an entire home can range between $10,000 – $20,000 and so many homes retain this original wiring.  Most insurance companies will no longer issue new insurance policies on homes with this antiquated wiring.  Therefore, if knob and tube wiring is discovered on an inspection, the cost of the rewire also generally falls to the seller – very few buyers are willing to buy a home (at least not unless they are getting a substantial discount) if it has knob & tube wiring present.

If you own a home with one of these hot potatoes – radon, mold, pushmatic panel or knob & tube wiring – things that years ago wouldn’t have raised an eyebrow – you should expect that when you go to sell your home, you will be stuck with the cost of getting rid of the hot potato, if you haven’t already done so!


Who Works for You?

Realtors are commonly called “agents,” but why?  Real estate is practice under the “law of agency,” which means that one party, the “agent,” represents the interest of another, “the principal.”  How does this really apply to you?

If you are a seller, you enter an “agency relationship” with the agent you choose to be your real estate advocate at the time you sign your listing agreement.  At that point, the agent you chose must act on your behalf, with your best interests in mind, to find a buyer.  And so does every other agent out there.  In Pennsylvania, buyer agency exists in written form only, so until a buyer actually signs a buyer agency agreement with a broker, all agents represent the seller’s interests.  Yes, buyers must be treated with honesty and fairness, but this does not mean they are represented.  The seller’s interests must always come first.

So what if you are a buyer?  This is probably sounding less than favorable right now.  All the sign or ad calls you have made – the open houses you have attended – the properties you may have screened without officially having your own buyer’s agent – the agents you were dealing with all represented the sellers and had a duty to put the sellers’ interests first.  That is great when you are the seller, but as real estate transactions have become more complex, buyers need representation too.

And so evolved buyer agency agreements in the state of Pennsylvania.  Buyers now have the right to demand an agency relationship where their interests must be put first by the agent.  To have this, buyers must sign a written agreement where they agree to work with only one agent and whereby the agent is bound to put that buyer’s interests first.  With a written buyer agency agreement in place, buyers know that an agent is representing their interests and must fulfill the obligation to faithfully serve them.

If you are a seller who has done your research, chosen the agent best qualified to advocate for your interests and have signed a listing agreement, you have representation.  If you are a buyer, you should do your due diligence – research agent qualifications – seek references  – and then sign a buyer agency agreement.  Know who is representing you, and don’t leave home without them!

Are You Paying Too Much?

Buyers often assume that if more than one offer is presented on a property, they will end up paying too much money.  In light of this view, many buyers back away when they find out a home is getting multiple offers.  Is this a sensible approach?  Is a bidding war evidence that someone will overpay for the home?   Will they ultimately lose money on the resale?

I would assert that is not the case.  Multiple bids may in fact be evidence of exactly the opposite scenario.  When more than one offer comes in on a home, it is usually because it has been well priced and/or is in excellent condition – that the home in fact represents a terrific value.  Looking exclusively at price fails to acknowledge the most important component – value.

If you are renting and considering buying, then an analysis of value must include an analysis of how your rental payment compares to the mortgage payment.  With interest rates as low as they are, mortgage payments are often far lower than rental payments.  This potential savings alone can represent real value to you.

When considering whether to jump into a bidding war, don’t forget to take into consideration that with each mortgage payment you are building equity in your home and increasing your net worth.  Additionally, it is important to consider the value of the mortgage interest deduction on your tax return – when you consider the tax savings currently available as a result of the deduction, you are “out-of-pocket” significantly less than it initially appears.

Interest rates have never been lower.  Inflationary times are predicted.  Inventory is at a low point.  Expect bidding wars.  But a higher price does not necessarily mean that you are getting a bad value.  Take the time to analyze all of the factors that create value with your real estate advisor before shutting down on price alone.  Don’t sit by the wayside and let someone else buy a home that is a good match for you – jump in and win!  When interest rates go up and inflation escalates, you will look back and be happy that you did!

Time IS of the Essence

Our real estate contract is very long, indeed.  With 11 “front” pages, plus 8 “back” pages, that is a lot of information for a real estate consumer to digest.  Buyers and sellers alike tend to focus on price, price, price and often neglect some of the document’s most important terms.  In our state, the Agreement of Sale declares “time is of the essence” inside the Agreement.  This is a legal term of art and yet all of the non-lawyers are expected to understand what it means.  To the real estate consumer, it means that the days mean what they say they mean – you get no extra time (without a signed addendum, that is) to meet you deadlines.  And so it is absolutely critical for every party to a real estate contract sit down with their contract and their realtor and write these critical dates on their calendar.  Gone are the days of a handshake forming the basis of a real estate transaction.  It is all very legal now and if you are not watching your deadlines, you very well could live to regret it.

So what harm may come, you may wonder, by missing a deadline by a day or two?  If you are a buyer and you fail to respond to your home inspection on time, you are taking the house as is.  This could mean absorbing a lot of inspection deficiencies.  Your only option if you miss this deadline?  Default on the contract and lose your hand money – it might be cheaper than absorbing a lot of inspection deficiencies.  Better yet – don’t miss the deadline!

If you are a buyer and the lender you choose fails to provide the seller with a compliant mortgage commitment on time, the seller has the right to terminate your transaction – this little slip-up could cost you your dream home.  Choose your lender wisely and make sure you impress upon them the importance of meeting this deadline – if they seem too busy with refinances, consider shopping for a lender who can guarantee that they will meet the deadline.

If you are a buyer or seller and you don’t make the closing date, you could be paying damages to the other party for the expenses they incur for your failure to close on time.

There are no automatic extensions or free days in PA – you need to know and abide by your deadlines or be prepared for the possibility of some unpleasant consequences.  Before you sign a contract, make sure you check your calendar and that you can focus your undivided attention to meeting these deadlines and making your real estate transaction a success.

The Toilet Stays!

Many of you have said I should write a book about all of my real estate stories, and 14 years later, they are really starting to pile up.  But this week’s story I just had to share.  This week I accompanied my buyers on a walk-through of their new home only to discover that the Seller had taken the master bathroom toilet with him when he moved out! Hard to imagine, I am sure.  No, it wasn’t handed down from great-grandma causing an emotional attachment, but it was a $1500 Toto toilet.  And so the question of fixtures comes into play.

When you sell a home, you sell with it everything that is “affixed” to the home.  Affixed items include any item that is attached with a  nail, screw, bolt or is wired in.  Mirrors handing on a hook can be detached and moved with you.  Mirrors attached be a screw must stay.  Shelving that is affixed to the wall must stay – free-standing units that are not screwed in any way to the wall can move with you.  Lighting fixtures stay – they are hardwired into the house (although free standing lamps can move with you). It’s a reasonably obvious standard, but before you list your home for sale, its critical that you walk through the home and assess what is attached.  If any of the attached items are things you want to take with you, it’s best to replace them before a buyer ever sees your home.  Believe it or not, sellers have lost deals over chandeliers that buyers just had to have and they couldn’t leave behind.  If the seller had removed the chandelier to begin with, it would not have become and issue and the sale may have gone through.  If there are items you plan to take and you absolutely cannot remove them in advance, then you must list them in the sales contract as exclusions.

Buyers, when you decide to buy a home, it is reasonable to assume that certain things will stay behind.  Yes, vanities, dishwashers, garbage disposals – all of those type items should be obvious to all.  But if there are specific things you want, be sure to have your agent include them in the agreement of sale.  Things like curtains, refrigerators, wine refrigerators, washers, dryers, ceiling fan remotes, mirrors on hooks all need to be specifically included or they wont be there when you close.  But don’t worry – the Toto toilet will be there, or will be replaced by the seller in advance of closing – it’s a fixture and it must stay!

A Master Plan

Our spring/summer market exceeded all expectations this year.  Our inventory remains low and the number of homes selling have increased dramatically – all good news for home sellers.  If you have been sitting on the sidelines thinking about selling, as the fall approaches, it is an excellent time to get your home on the market.  We have fewer homes enter the market in the fall, meaning less competition for you.  However, even in a strong market with low inventory, it is important to go into the market with a master plan and not just throw a sign in the yard and hope for the best.  A successful sale starts with a master plan and a partnership between agent and homeowner.  We must partner together to get your home sold.  A great listing agent works hard to market your home, but only you must supply the highly saleable product.  So what ‘s your role in the plan?

First, start packing right away.  Your plan is to move and your treasures will all need to get boxed up anyhow.  Move them to a pod or an off-site storage facility – no need to raise objections from buyers if there appears to be inadequate storage space.

Have your home pre-inspected and repair what is uncovered as deficient by the inspector.  This will impress a buyer that you have taken the time to make sure the home is in good condition for them.

Bring in a staging expert to put the finishing touches in place – you only get one chance to make a first impression – make it a good one!

Finally, listen to feedback, from both agents and buyers, and act on it..   Buyers generally will not buy projects, unless of course you want to fire sell your home.  So if any objections have been raised (wallpaper, paint colors, old roof, overgrown landscaping, too much clutter, dated décor), you must deal with them if you want your home to sell.

It Starts and Ends with the Contract…for Buyers

Last week I talked about how important it is for both parties to respect the contract they sign, and specifically addressed important things for sellers to keep in mind as they move toward a closing.  Sellers are not the only ones, however, that need to be sure to honor the contract they sign.  Buyers, you too need to understand the contract and abide by its terms.

Let’s start with deadlines.  The contract gives you a set period of time to address your contingencies, such as inspections, appraisals and mortgage applications.  The contract is very clear – miss your deadline and you waive your contingency.  So once you have a signed agreement, take the time to write the deadlines on your calendar and then be sure that you comply with them.  If you don’t, you will lose your bargaining right and your only option if you are unhappy at that point is to terminate and forfeit your hand money.  That’s a real shame when you have taken the time to find a home you love and a compromise may have been reached if you had been watching your calendar.

Understand the mortgage approval process.  You generally must apply for a mortgage within 7 days of reaching agreement.  It is possible that you could pay out mortgage application fees only to decide you are unhappy with the inspection, terminate the deal, and lose your mortgage application fees.  This is something to work out with your lender before you make an offer on a home – some will allow you apply fees to future home purchases if a deal falls apart – but in any event, you absolutely must make timely application even if this means you risk losing the fees.

If your home purchase is contingent upon the sale of another home, or if you have an extended closing period, you will likely have to pay for two appraisals – one at the time of initial application, and one prior to closing.  This will add approximately $350 to your expenses.  Again, while it is additional funds you must expend, it is part of the deal you struck and only fair to the seller who is likely abiding by all of the terms that apply to him.

Understand that if you do back out of a deal once your contingency periods have expired, you will lose your hand money.  It is the deal you struck when you offered to buy the home and just compensation to the seller, who has taken his home off the market with the understanding that you will buy it.  Put yourself in his shoes before you decide to tie up the release of hand money in arbitration.

As I said last week, contracts are lengthy and complex and it is important that you really understand what you are signing and what you are obligating yourself to do — be sure to hire a realtor that you have confidence will thoroughly explain what you have signed and help you to be a good buyer and honor all of its terms!

It Starts and Ends with the Contract…for Sellers

The real estate contract is what makes a real estate transaction work.  If you want to sell your home, you need some kind of document that binds the buyer to your home so that they don’t just walk away, leaving you holding a home you just moved out of and unable to close on your new home.  It is equally important to the buyer – they need a document by which a seller is actually bound to sell their home so that the buyer is also not sitting on the curb waiting to unload the moving van and unable to get the seller out (and yes, real estate is specific performance – if you sign a contract to sell, you must sell).

But these days I have noticed a trend away from respecting contracts.  For some reason, people seem to have forgotten that what they sign in a real estate deal is in fact legally binding.  I have seen blatant disregard for contracts from both buyers and sellers – this week I will focus on the sellers.

Sellers, if you include something on your disclosure, it is important that you actually leave it behind for the buyer.  The stove and dishwasher are obvious, but what about garage door openers?  When you are listing your home, take the time to be sure that you correctly list what is included – misplace a garage door opener and you are contractually required to buy a new one for the buyer.

If you agree to fix something during an inspection negotiation, then yes, you must actually get it fixed. Its not ok to have the buyer show up for the walk through and find out you haven’t taken care of the agreed upon repairs.  What you signed is legally binding – do what you said you will do or be prepared to give a hefty last minute credit to the buyer.  If you do get the items fixed, pay your bills!  These repair bills are not the buyers’ responsibility and its also not ok to agree to make a repair and then stick the buyer with the bill.

And remember, the contract requires that your home be in the same condition it was in when the buyer made you the offer.  If you break something, you will need to fix it prior to closing.  At 11 pages, it is a lengthy document but it is important that you understand what you have agreed to do.  We can’t all be attorneys, so be sure to hire a realtor that you have confidence will thoroughly explain what you have signed and help you to be a good seller and honor all of its terms!

Have You Really Thought This Through?

As the market has improved this spring, Sellers are occasionally considering selling their homes themselves, without the advocacy of their trusted agent.  The rationale seems the same – save the commission.  And yet, while a commission is in fact not paid, it is paid in reduced realizations.  You see, buyers are very savvy – they know what the market will bear and if you, the seller, do not have to pay an agent, they expect to realize the benefit of a reduced  purchase price.  Buyers also know that if they can get you to start to walk down the FSBO road with them, you will be unlikely to back out even if they are less than reasonable because you will fear losing the deal you appear to have happening and will be very unsure about whether there will be another buyer.  It is a rare day that we see FSBOs actually achieve a net sales price greater than what we, agents with the power of big advertising dollars and years and years of strong negotiating experience, can achieve.  So in the end, your net sales price is the same, and yet you have to deal with all of the tricky little details yourself.  Details like making sure you actually have a valid contract (not as simple as it might seem), to working your way through financing and inspection issues, to working to make sure you close on time.  All of the jobs that we, the agents do – attending to every last detail to make your transaction smooth sailing – you must now handle on your own – and yet you are getting nothing for your effort because your net is no higher, and may be lower, than we agents could have achieved.  If your house is “hot” enough to bring a FSBO buyer to the table with minimal or no advertising, imagine how much excitement we could generate with the power of our advertising behind your home – these days, a bidding war is even possible!

Statistically, FSBO transactions also fail to close more often than brokered transactions.  So if it is important to you to close (and you are not just fishing for an offer if someone happens to come along), consider this as you decide how to proceed.

I can cut my own hair to save a few bucks – but it wont look as nice as it would if I went to the salon – I can paint my own walls (try to ignore the messy spots) – I can invest my own money (and watch it stagnate) – I can suture my own wounds (and end up in the ER with an infection).  I can do almost anything – but not as well nor to as successful an end as someone with years of experience.  The same is true for real estate.  Years of transactions and we, the trained professionals, make it look easy.  Before you don your real estate cap, take the time to think it through and ask yourself whether you are absolutely certain that you will actually come out ahead on your own.  Statistics are clear that you will not.

Should You Pre-Inspect?

Dear Kathe,

Friends of mine just had the sale of their home fall through because of a home inspection. How can that be prevented?

 Yes – sellers should have their home pre-inspected before listing to prevent these kinds of issues! Finding a buyer and agreeing on a purchase price is only one small component of a real estate transaction and yet it is often all that sellers focus on.  What happens between then and closing, however, is often the more difficult part of the process.  Issues with a home uncovered on an inspection often cost a seller thousands in unexpected repairs and when sometimes even result in a terminated transaction.  Inspectors are incredibly thorough (sometimes even finding problems that aren’t problems) and so every home seller should anticipate that the home inspector will find deficiencies and that the buyer will expect correction.

All home sellers should seriously consider having their homes pre-inspected.  For as little as $250 – $500 for a basic pre-inspection you will quickly have an insiders view of how a buyer’s inspector will assess your home.  Use the inspection as a maintenance check list – find a handyman to come in and fix all of the little things so that they don’t come up again on a buyer’s inspection.  If there are larger items that you do not have the ability to repair, such as a roof nearing the end of its useful life, get an estimate or two for the repair or replacement.  Note the issue on your disclosure and include a copy of the estimate.  This should prevent you from having to credit the buyer for the repair later – buyers are supposed to review the disclosure and take any disclosed items into account in making their offer to you.

Of course, if your inspection is good or just has a lot of little items that a handyman can fix, attach the handyman’s receipt showing the repair provide a copy of the inspection in the house for buyers to see with a note indicating that the home has been pre-inspected and repaired and that they buyer can buy with confidence knowing that they are buying a house in great shape!  In a town full of older and aging homes, this will really help your marketing!

So before you list your home – consider a pre-inspection.  It will give buyers the confidence they need to move ahead with a purchase, may combat concerns that there are likely problems that would lower their initial offer to you, and will hopefully result in a smooth transaction once you do have your home under agreement.

The Disclosure — Your Best Insurance Policy

If you have bought or sold a home in the past 15 years then you have come across our (now very lengthy 6 page) Seller Disclosure.  The Disclosure is the document where, as required by law, the seller discloses what they know about the property that they are selling.  Sellers – the Disclosure is your friend – it is your best insurance policy against future problems in the deal or lawsuits after the fact – take the time to fill it out completely.

Right now, if you are like most home owners, you are probably thinking “I maintain my home – its in great shape.”  Or maybe “its an old home – old homes have problems – that’s what you get when you own an old home.”  You might be surprised to learn that what you know and fail to disclose could present future liability to you.

What might you not be thinking of?  The list is endless – some quick examples  follow.  Ever have water leak into the basement that you thought you fixed?  The disclosure asks if you have ever had water enter the basement.  Even if it seems fixed, you must still disclose that it happened – failure to do so could result in a lawsuit if the problem recurs when the buyer moves in.  How about windows that are painted shut, don’t stay open or have broken seals?  Failure to disclose these sorts of issues can cost you thousands when the home inspector inevitably finds them – if you disclose them upfront, the buyer cannot object to their presence later.  How about bathrooms that do not have exhaust fans to the exterior?  Bathrooms, kitchens or garages without GFCI plugs?  Staircases without handrails? Cracked pavement in sidewalks or driveways?  Non-fire rated doors leading into attached garages?  All of these things seem like non-issues when you live in a home but if not disclosed, can cost you thousands in inspection repairs.

And don’t forget disputes (or what could become a dispute).  Is your fence just a little bit over the property line?  Disclose, or you could find yourself having to pay to move the fence prior to closing.  Do you have liens against your home, such as tax or contractor liens?  Failure to disclose could cost you thousands in compensatory damages to your buyer if the closing is held up as the closing company tries to address the liens and your buyers find themselves having to store their belongings and live in a hotel.

If you are selling your home, it’s a good idea to sit down with your experienced real estate agent and make sure you have thought through all of the possible items that need to be disclosed.  If  you take the time to be thorough, it is your best insurance policy against future problems.

Buyers be Good to Your Sellers, Too

The past few weeks I’ve talked a lot about what it takes to woo a buyer, and how to avoid turning buyers off.  But buyers beware!  You also need to pay attention to seller turn-offs if you actually want to successfully close on a home! So what should you avoid doing?

First and most obvious. don’t speak badly about a sellers home, either when they are present or in a letter to the seller (and beware baby monitors – some sellers have been known to use them to “spy” on buyers!)   All this does is put a seller on the defensive and make them not want to sell you the home.

Along these lines, due thorough due diligence and make sure your offer is grounded in reality and not your dreams of owning a home you can’t really afford.  Be sure that you have fully “seen” the market and know how your home choice fits in the market.  Work with an agent whose analytic skills you trust and get a thorough understanding of the likely sales price of the home.  And then do not lowball unless it is extremely clear that the seller’s asking price bears no relation to reality.   There is no faster way to sour a deal than to start throwing unjustified lowball offers at a seller, unless you really didn’t want to buy the home to begin with.

Be sure to take the time to get pre-approved, and thoroughly disclose all of your financial circumstances to a lender.  Nothing is more annoying than having a deal fall-through because a  buyer can’t get the loan.  Be brutally honest with the lender upfront – there is no gaming the system these days, and if you aren’t be able to get the loan, save yourself the heartache as well and find out early in the process.

Finally, don’t mislead the seller.  Don’t offer a high price with a plan to beat the seller up on the inspection.  Don’t stick in an appraisal contingency with a plan to get the price reduced to a lower price later, once you think you have a captive seller.  And don’t try to renegotiate the deal later – if the seller discloses pre-existing conditions to you, your offer should be the price you are willing to pay given those conditions and you should not come back with your hand out looking for more later.

If both buyers and sellers give each other these common courtesies, you’d be surprised how smoothly transactions can progress to smooth closings!

The Trail to a Sale, Part II

Last week I talked about how hot our spring market has been.  To take advantage of this market, sellers must do their part in getting a home sold.   While we are in a hot market, gone are the days when you can get away with sticking a for sale sign in the yard, a lock box on the house and watching the offers roll in.  Too much HGTV!  Buyers expect every home to look like it could be in a magazine and sellers who take the time to meet these expectations fare exceptionally well.  Last week I talked about the exterior of the home, which is critical if a buyer is even going to consider the home.  Once in the door though, the interior must present equally as well.

Getting the interior of your home ready for a buyer can be a real challenge for a seller who has lived in and loved their home for years.  I was once criticized for wanting my listings to be “perfect,” but let me ask you – if you could spend $5,000 and make $25,000 more on your home sale, was that a worthwhile use of your time and resources?  Of course, home sellers never know what they might have gotten if they had failed to make the recommended improvements.  And those who chose not to do the hard work will never know what they might have gotten had they improved their home.  So what do you do?  You need the advice of an experienced agent who knows exactly which improvements will pay for themselves. You also need to hire an experienced home stager who can help you to best present what you do have.  And finally, once you engage these professionals, as painful as it may be, you actually need to take their advice.

I personally learned this lesson the hard way.  I marketed my own home in 2008 for 18 months.  I was a big fan of color and that was obvious in my home.  My home finally sold one month after every wall inside had been repainted a warm neutral color and I had it professionally staged, including a furniture and accessories package.  In the end, the sale was well worth the effort!

Where to start?  With the wallpaper!  A Pittsburgh favorite in years past, most buyers have an extremely negative reaction to wallpaper – it is so personal that, no matter what the designer brand name, it is like asking someone to wear your wedding dress.  It needs to come down.  Paint can be in a warm neutral color tone (white is not necessarily a good choice) but should not be “loud.”  Nick knacks need to be packed up and stored, ready to move to your new home.  Windows may show better without drapes.  Kitchens and baths may need “freshening” and if you have a lot of furniture, some of it may need to find a temporary home in a storage facility to open up the rooms.

Great condition sells homes.   Feel free to call me and we can develop a strategy now for making a strong introduction into the market!

The Price is Right!

Deciding on an asking price is a challenging task, particularly in Sewickley.  Interestingly, in Pittsburgh’s North Hills, sellers realize much closer to their asking price, often 97% and higher.  However, if a property is overpriced in the North Hills, buyers will simply write the property off – low-ball offers are not made.  In Sewickley, however, we have developed the unique tradition of negotiating fairly heavily on the sale of a home.  In Edgeworth last year, the average realization was only 89% and offers often start as low as 80% below asking price.  So how is a seller to price a property?  If a seller prices 20% over the price a home is likely to sell for to allow for negotiating, it is likely to be seen as “overpriced.”  If the seller prices only 2% over likely sales prices, many buyers will factor in the large discounts we often see and bring in inappropriately low offers.  Developing a strategy for both pricing and marketing is therefore critical to make sure that a home is both well received and does not sit and get stale on the market.

If you’re facing a deadline due to job relocation or other reasons, then you need to price competitively, even more competitively than expected in today’s market.  You’ll need to list at significantly less than your competition.  And keep your commission higher as an incentive for a quicker offer.  That may seem tough to stomach, but it’s better than continuing your monthly loan payments or the hassle of trying to find tenants to rent your home and of being a landlord for a year or more.

If your home has been listed for some time, but not generating interest, you may need to lower your price.  Of the three elements that sell a home – price, location, and condition – price is the one you’ll have the most control over.  Review your listing company’s programs and marketing, making sure that you are taking advantage of all of them.

Make sure your home shows better than its competition.  Its condition should outshine all of the other listings in its price range.  Take time to de-clutter, store off site what you can live without, stage and make sure you attend to all of the little maintenance projects you may have been putting off.

In the end, Sewickley statistics show that if your home does not have an agreement on it within 75 days of the listing date, you will not achieve 90% or more of your original asking price.  This makes the original list price a critical decision and also makes it clear that after 75 days, it is absolutely essential to reevaluate your price in light of market feedback and price.

Helping the Next Generation of Home Buyers Prepare for Success

Obtaining financing to purchase a home seems to get more and more complex as the years pass by.  Many of my readers are likely long term homeowners who pay their bills on time and are not concerned about getting their next loan, whether its time to move up, down or just across town.  But what about the next generation of home buyers? The next generation of home buyers may very well be your kids or grandkids.  Our housing market starts at the bottom and builds from there.  People buy their first home, which allows someone else to make a move, and eventually all of these moves will affect you and your property value.  So equipping the next round of first time home buyers with the tools it takes to actually buy a home benefits us all.

When I was a kid I overheard my parents talking about saving the 20% down and being sure to pay all the bills on time.  But we recently moved through a period in our nation’s lending history when money was free flowing and loans could be had with a wink and a handshake. But those days are gone, likely forever.

After many “easy money” years, our newest group of home buyers may not have been educated with the old mantras – save – pay on time – and they may shocked to find out that they don’t have what it takes to get a loan.  So what does it take?  A loan applicant must have credit in their name (and not a card they are authorized to use that belongs to mom or dad) on three separate lines (cards, car loans) and they must NEVER have made a late payment.  The cards DO NOT have to be actually used to establish a credit history – the potential homebuyer just has to have been granted the cards.  If they do use the cards, then as a general rule, it is not a good idea to charge more than 50% of the credit granted in any given payment cycle, at least if they are nearing a time when a loan application is planned.  If they miss a payment, that line of credit is disqualified and they will  need to show the existence of 3 lines of credit that have never had a miss.  If they don’t have three lines of credit showing on their credit report, they will only be eligible for an FHA loan, and must be able to show 12 months of payment history on other things such as a cell phone bill or utility bill in their own name (note: utilities paid on a budget plan do not satisfy this requirement).

So what should you be doing to help the next generation of home buyers?  Educate your kids & grandkids about how they will have to learn to use credit cards responsibly and how they will always have to pay their bills on time.  When you feel they can handle a credit card (or 3), help them choose appropriate no fee cards.  Consider checking in with them each month at first to make sure that they are remembering to pay the bills (preferably in full) by the deadline each month.  With a little coaching, we can all help the next generation of homebuyers to be ready to successfully purchase their new home.

Its a Global Economy, but Our Market is Still Very Local

I’m sure you’ve read it in the news – whether online or in print – but when it comes to real estate, it seems that there is always the good, and the bad. So, which is it?  Who’s right?  The answer is simpler than you might guess – they are all right.

As much as we are all interconnected to each other in this technologic age, there is still a strong separateness when it comes to real estate.  What happens internationally can affect your portfolio on a daily basis, but it takes a lot to affect the local housing market.  Our prices here are almost entirely dependent on what is happening here and now.  And right now, that’s all good.  With the natural gas industry bringing so many people to our region, we have had an increased demand for housing. At the same time, the national economy has caused large employers to hold back on relocating employees, creating an unusual lack of homes coming on the market.  Anxiety about the future has caused many who might have moved up to hold back, despite the amazing interest  rates.  This has all converged to cause a bit of a log jam in our market – there just isn’t much to buy, which creates a very strong real estate market.

The stability of our region has gotten us through these tough economic times without the major losses (in many markets in excess of 50%) what some have seen.  It has also made real estate one of the best investments you can make – with your money safely parked in local real estate, you don’t have to worry about the near daily swings in value, and with a supply shortage, renting is a popular option, driving up rental prices for those who have chosen to become landlords as part of their investing plan.

So what does this mean for you?  You get to enjoy all of the advantages of a global economy – fast and easy access to things we never would have imagined even 20 years ago, but at the end of the day you can rest soundly knowing that by investing in local real estate, you have added stability to your portfolio and to your life.  Sewickley is a great place to invest.  Of course, in making your investment choices, it’s also a very local market.  While websites can offer all sorts of analytic data about market value, real estate is more emotion than analytics.  Advising you on how to price, strategies for selling at the best price, how to buy smart for future resale  – that also is very local.  To make your best decisions regarding your real estate investments, you need to be certain, first and foremost, that you are being advised by a licensed professional who works in the market you plan to invest in every single day who can provide you with the best analysis and advice to make your local investment as sound as it can be.  With that advisor by your side, local is a great place to be!