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Couldn’t Sell Your Home Last Season? Here’s How to Relist It So It’ll Move
If a home lingers on the market too long, it begins to acquire, well, a reputation. Deserved or not, the home may be perceived by buyers as flawed or overpriced. So in the interest of avoiding a bad rep—or becoming the real estate equivalent of the last kid picked for kickball at recess—some sellers pull their listing from the market and take some time to reassess and, eventually, relist.
Of course, it’s not as easy as pulling the home one day and relisting the next. Even if you take a home off the market and start over with a new agent, it won’t necessarily appear as a new listing. Your local multiple listing service has rules that determine what qualifies as new.
In Chicago, for example, you’ll need to have your home off the market for as long as six months before it can count as new. In Jacksonville, FL, you only have to wait 45 days. Since the rules vary from city to city, make sure to check with a local broker about how long your home must be off the market before it can be “new” again.
In the Washington, DC, metro area, your home has to be off the market for at least 90 days to reset the “days on market” ticker to zero, says Sue Goodhart with McEnearney Associates in Alexandria, VA. She added that it’s not a total reset, because the property record will still indicate the home’s previous exposure to the market.
Property sales and listing history are easy for any prospective buyer to find, saysRhonda Duffy, broker/owner of Duffy Realty of Atlanta. While a lingering listing might be giving your home a bad rep, she thinks marketing plays an important role in getting your home sold.
“Getting a new MLS number is much less important than what I call ‘juicing’ a listing with something new that will grab the attention of buyers,” Duffy said.
The first thing an agent can do is analyze why your home didn’t sell and then address that issue, Goodhart says.
“Sometimes it’s the price, but often it’s the way the home shows in person or online, or a lack of targeted marketing,” she said. “Sometimes it’s as simple as realizing that the photos were taken on a cloudy day and it makes the rooms look too dark.”
Photos more crucial than priceGoodhart relisted an affordable condo that had been on the market for 157 days but should have sold much faster. She says they cleaned it and took new photos, and it sold in four days.
“You want to have a freshened listing re-sent with new photos and new lighting to entice buyers,” Duffy said.
“It’s especially important to send seasonally appropriate photos,” she added. “If it’s spring, you don’t want to start off with a photo that shows fall leaves or piles of snow, because that’s an instant tipoff that the home has been sitting on the market.”
It’s also important to take new photos if the home has been staged or updated in any way. At the same time, Duffy stressed that only attractive photos should be displayed with the listing. Some agents upload dozens of photos just to meet a quota rather than showcase only the most enticing photos of a home, she said.
Price changes that work
A small price change may serve to trigger an email alert to buyers who have set up a home search based on their price range. For example, if your home is priced at $255,000, you’re not reaching buyers who’ve set their search for homes priced between $225,000 and $250,000. Reducing the price to $249,900 will draw new attention to the property without a deep price cut.
“The key is that even if you juice the listing with a price change, you also need to change the photos so that buyers stop and look at it and wonder if they’ve seen the property before,” Duffy said.
Staging and timing crucial to saleOne of Goodhart’s relistings was reduced from $864,900 to $859,900, but she believes staging the home was more important than the price change. She replaced antique furniture with with Pottery Barn-style furniture that would appeal to older millennials
New photos showcased the new look, and the home sold in six days.
“Shopping online makes a huge difference,” Goodhart said. “Buyers today are looking at 15 to 20 properties every night, so your photos have to be perfect to make your home stand out.”
Whether it’s staging, photos, or a new agent, avoiding the dreaded rep of a lingering listing is something every seller must consider.
When potential buyers drive up to your home, they’re full of hope.
They imagine themselves baking in the kitchen and their kids playing in the yard. Most of all they think: “Could this be my home?”
Then they look closer. They see a mess by the driveway and the peeling paint near the roofline. Very quickly, they decide to keep driving—and keep looking. They don’t want your home. The exterior tells them the interior might have the same negative impact.
They’ve already done research on your neighborhood and know your asking price. Now they’re just driving by to see if your home has that “it” factor—not an “ick” factor.
Where do most sellers go wrong? Here are the main mistakes they make:
1. Ignore curb appeal
How your home appears from the curb is extremely important. It’s the proverbial first impression. If your home looks inviting from the outside—the yard maintained, the garden manicured and the paint fresh—potential buyers will take an interest in it. If not, they might think the interior is likely unkempt, too—and they’ll move on.
2. Crowd the buyer
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When you sell your home, take yourself out of the picture. If you happen to be home, greet any potential buyers and then allow them to walk through your home undisturbed. Give them a chance to picture their couches in the living room or their dining set in the dining room. Let them have space to discuss what they’re seeing.
Some sellers crowd a buyer, thinking that any newcomer will want all the details of every renovation and every nook. Don’t do this. Let the buyer be. You can always provide an info sheet to describe anything you feel should be mentioned.
3. Offer that ‘lived-in’ look
Prospective buyers don’t want to see your clutter. It’s distracting and makes it hard for them to picture themselves in your home. A mess can often hide aspects of the home that would entice someone else to buy.
When you’re selling, keep a tidy home and tuck away all your family photos and knickknacks. Try to create as many open, clear spaces as you can. Clean off counters and other surfaces. Even the toaster and blender should be stored away when you show your home.
Ideally you will have time to give all the rooms a fresh coat of paint. You don’t need to hire an interior designer, but do look over your home with an unbiased eye. Is it warm and inviting? Pleasing to the eye?
4. Let odors linger
If you smoke or have pets, your home will likely have an odor. Although you might be used to it, others may not appreciate it.
Removing pet urine smells out of carpets takes care; you’ll likely need to use special solutions or a steam cleaner. With rugs, you may just have to buy new ones. Vinegar will work on most flooring. If you have a litter box, change it daily while showing your home.
If you smoke, try to smoke outside as much as possible. Most nonsmokers are sensitive to the smell of smoke. Not only will they want to leave, they may also find the prospect of cleansing a home of smoke odor a turnoff. You may be so used to it that you hardly notice the odor, but others will walk out the door quickly.
If there is a heavy smell in the home from years of smoking indoors, try washing the walls with vinegar. And don’t forget the curtains, shades and anything else that might collect the tar and resin from the smoke.
For any unwanted smells, try baking soda. Sprinkle it around the house, on the furniture and on the carpets. Let it sit for a day so the granules can absorb the odors and then vacuum it all up. You may have to do this a few times.
Think of it as vacuuming your way to a good deal on your home.
Lenders are showing signs of loosening up when it comes to home buyers seeking a mortgage. The Mortgage Bankers Association's Mortgage Credit Availability Index ticked up slight in April, following an increase the previous month too. Increases in the index are indicative of an overall loosening of credit.
Other government offerings also helped to ease credit even more in the latest report, reflecting April data, MBA notes.MBA's index shows that mortgage credit availability has increased consistently over the last several months, coinciding with recent announcements from the federal government of programs that have been designed to open the credit box. Fannie Mae and Freddie Mac's move to back 3 percent down payment loans as well as the Federal Housing Administration’s action to reduce its mortgage insurance premiums have helped ease credit, MBA Chief Mike Fratantoni says.
"Mortgage credit availability increased on net in April," Fratantoni says. "The increase was driven by new offerings of FHA's 203K home improvement program, new VA offerings, and new jumbo products. The increase was partially offset by some investors tightening underwriting criteria on conventional cash out offerings."
REALTORS® surveyed have pinpointed tight credit conditions, significant lender overlays, and loan processing delay as a major hurdle facing their buyers the past few years, but REALTORS® are also reporting gradual improvements, according to the latest REALTORS® Confidence Index, a survey of real estate professionals.
REALTORS® point to the trend of lenders showing more willingness to accept slightly lower FICO scores – moving from the high range of 740-plus to now the mid-range of 620-740. Also, REALTORS® note an increase in the number of their clients securing a loan while making zero to 6 percent down payments. FHA's reduction in the mortgage insurance premium and the GSE-backed 3 percent down payment loans are helping buyers to come with less money to the table.
But while mortgage credit availability is showing definite signs of easing, credit continues to still be far less available than it was during the housing boom days, according to MBA.
A century ago, fewer than six percent of all households consisted of people who lived alone. By 2013, that percentage has jumped to 28 percent, with single-person households now making up the second most common household type just behind married couples without minor children (at 29 percent), according to U.S. Census Bureau data. What's more, single households have now surpassed married households with minor children (19 percent).
These single households – once mostly dominated by men – have shifted to a rise in the number of women living alone. Women now head 54 percent of all single-person households.
In large cities, single person households account for 45 percent of all households. Some neighborhoods in Manhattan and Washington, D.C., in particular, have single-person households that approach two-thirds of its households."In the past, when living alone might have been a short-term condition, for many it is now a long-term situation, the result of a number of broad demographic and economic forces at work over the past half century: greater affluence, longer lives, later ages of marriage, higher divorce, smaller family sizes, greater labor force participation and financial independence of women, and stronger government safety nets across a wide spectrum of social programs," writes George Masnick, senior research fellow at The Harvard Joint Center of Housing Studies.
Single-person households aren't dominated by one generation either. About 28 percent of all single-person households are under the age of 45; another 36 percent are between the ages of 45 and 64; and 36 percent are over the age of 65.
Many of these single-person households are also home owners. Fifty-four percent of single-person households are owner-occupied, according to the 2013 American Housing Survey. Between 2003 and 2013, owners comprised 55 percent of the growth in single person households.
Don't underestimate the importance of a beautiful yard to home owners and their neighbors. 84 percent of adults say that the quality of a home's landscape and yard would affect their decision on whether to purchase a home or not, according to a new survey of more than 2,000 adults conducted by the National Association of Landscape Professionals.
"Across the board, the survey reveals that Americans deeply value surrounding natural elements and yards where they can spend time outside their homes," according to the National Association of Landscape Professionals.The majority of Americans want to live amid nice landscaping. The survey found that 91 percent of Americans believe it is important to live in close proximity to trees, grass, or nice landscaping. Midwesterners are the most likely to rate the importance of landscaping the highest (at 94%), followed by the West (89%) and Northeast (87%).
Eighty-four percent of home owners surveyed said that it is important to have their yard well-maintained, and 71 percent also say it's important for their neighbors to have well-maintained landscapes as well. But the survey finds that only 33 percent of Americans say they believe they have the knowledge and skills to keep their lawn and plants healthy and appealing.
Millennials make up the largest share of home buyers at 32 percent, according to a recentgenerational trends report by the National Association of REALTORS®. While older generations sought out homes with luxury amenities and rooms with one specific purpose, younger buyers are seeking affordable, efficient homes that can be customized to suit their changing needs.
These are the top five millennial home desires, according to Boyce Thompson, former editor of Builder Magazine:"When it comes to homes today, millennials want something creative, something different," says James Roche, CEO ofHouseplans.com. "They want something that better suits the times. For example, fine china and living rooms that nobody ever sets foot in are considered desires of the past. Dining rooms are being converted into home offices. Family rooms are being transformed into media centers. And, homeowners are now leveraging smartphones and tablets to adjust the temperature, or turn on outdoor lights and security systems."
Affordability. Many millennials want a home that is affordable, yet "move-in ready," with all the bells and whistles, including an updated kitchen, high-tech amenities, and open, versatile spaces with an indoor-outdoor flow.
Efficiency. Millennials tend to be conscious of not being wasteful, and will do what it takes to save on the use of electricity and water. "One [Florida] home I worked on featured one of the earliest disappearing window walls in production housing," says Thompson. "You walked through a short entry vestibule to the main living area, and you looked right through the home, to the pool deck, and out into the Orlando night. The architect, Mike Woodley, and I sat on a couch in the family room and watched the delighted expression of visitors as they entered the space and discovered that a corner of the roof was suspended on a post in the pool."
Flexibility. Since millennials see their homes as an extension of the rest of their lives, not just as a refuge from work, they prefer casual, flexible spaces. They want home offices that can convert to a game room and large attic spaces that could eventually be transformed as a play space. Customization of the home is important, even if it means spending extra money. "An ideal floor plan might include an "away" room, especially if you needed to 'get away' to do yoga, practice the guitar, or, even if you want to isolate your child’s latest Lego creation," says Thompson. "Then, later on, this space could eventually be converted into a bedroom."
Going Green. A recent study from NAR revealed that 10% of millennials seek out new-home construction for green/energy efficient reasons. As a group, young buyers prefer green building and homes that use sustainable, recycled materials. They want housing that's smaller and energy-efficient (think LED lighting), and they appreciate good engineering.
Entertaining. It should be no surprise that the younger generation wants a home that they can show off to their neighbors and friends and use as an entertainment space – from fire pits to open floor plans to game rooms. They also have a deep appreciation for versatile outdoor spaces that extend living space.
Construction of newly built single-family homes edged up
The new-home market continues to make gains, albeit at a gradual pace as some price sensitive buyers remain on the fence, says Tom Woods, chairman of the National Association of Home Builders on the latest new-home data.
Construction of newly built single-family homes edged up 4.4 percent in March month-over-month, while multifamily starts dropped 2.5 percent, the Commerce Department reported Thursday. Overall, nationwide housing starts – which reflect combined starts for the single-family and multifamily sectors – rose 2 percent in March to a seasonally adjusted annual rate of 926,000 units.
"Builders are being careful not to add inventory beyond expected demand, especially as they struggle with increasing costs for lots, labor and materials," says NAHB Chief Economist David Crowe. "However, pent-up demand, low mortgage interest rates, and a growing economy should keep the housing industry moving forward throughout the rest of the year."
Regionally, housing starts posted the highest gains in the Northeast. Combined single- and multifamily housing starts surged 114.9 percent month-over-month in the Northeast, and the Midwest also saw a gain of 31.3 percent in March. Meanwhile, housing starts dropped 19.3 percent in the West and by 3.5 percent in the South.
"There is a continuing under performance of the new-construction market, but it’s still better than where we were," says Jed Smith, managing director of quantitative research at the National Association of REALTORS®.A slight decline in housing production may be on the horizon, however. Housing permits – a leading indicator of the health of the new-construction industry -- fell 5.7 percent in March, led by a 15.9 percent drop in multifamily permits. Single-family permits, on the other hand, rose 2.1 percent – with the strongest gains in permits in the Northeast.
To return to a more normal market, Smith says builders need to construct 1.5 million to 1.6 million new homes this year. Builders are on track for 1.2 million, he says.
But there's no reason to panic, housing analysts say. Housing permits overall are still up 8 percent from year to date.
"In some regions, we’re seeing double-digit gains," says Jonathan Smoke, realtor.com®’s chief economist. "It shows we’re making progress—it’s not even remotely enough to relieve the inventory shortage, but we’re moving in the right direction."
The spring home sale season has finally sprung. Existing-home sales surged to the highest annual rate since September 2013. Also: More homes went up for sale, relieving some inventory constraints, according to the National Association of REALTORS®’ latest report.
The Midwest posted the largest gains in home sales, but all regions saw a rise in March and are above their year-over-year sales pace, NAR reports.
“After a quiet start to the year, sales activity picked up greatly throughout the country in March,” says Lawrence Yun, NAR’s chief economist. “The combination of low interest rates and the ongoing stability in the job market is improving buyer confidence and finally releasing some of the sizable pent-up demand that accumulated in recent years.”
Existing-home sales—reflecting completed transactions for single-family homes, townhomes, condos, and co-ops—rose 6.1 percent in March month-over-month to a seasonally adjusted annual rate of 5.19 million—the highest annual rate in 18 months. Sales are now 10.4 percent above a year ago.
Home prices also climbed last month, with the median existing-home price for all housing types reaching $212,100 in March—7.8 percent higher than March 2014. That is the largest price increase since February 2014, when prices jumped 8.8 percent year-over-year.
More homes were on the market nationwide in March, with unsold inventories climbing 5.3 percent to 2 million existing homes available for sale, representing a 4.6-month supply. Inventories are now 2 percent above year-ago levels.
“The modest rise in housing supply at the end of the month despite the strong growth in sales is a welcome sign,” Yun says. “For sales to build upon the current pace, home owners will increasingly need to be confident in their ability to sell their home while having enough time and choices to upgrade or downsize. More listings and new-home construction are still needed to tame price growth and provide more opportunity for first-time buyers to enter the market.” The share of first-time buyers in March was 30 percent (historically, they represent a 40 percent share).
CEOs of the largest companies renting out single-family homes say they plan to raise rents up to 5.7 percent this year. Investors are switching their focus from buying properties to optimizing the revenue from the thousands of properties they bought, taking advantage of the increased demand for rental homes, Bloomberg reports.
Large-scale investors—those who purchase at least 10 properties a year—have spent about $68 million snatching up 528,000 single-family rental homes since 2011, according to a report last month by Haendel St. Juste, a Morgan Stanley analyst. Now the CEOs of Silver Bay, Starwood Waypoint, American Residential Properties, and Blackstone Group all say they plan to raise rents this year.“In the 2015 rental season, we’re really seeing the ability to move rents,” David Singelyn, chief executive officer of American Homes 4 Rent—the largest publicly-traded single-family landlord, with about 35,000 homes—said at a recent conference in Miami Beach, Fla.
“We are focusing aggressively on rent bumps,” Stephen Schmitz, American Residential Properties CEO, said during a panel discussion. “There’s a supply imbalance in some markets. The same thing that keeps occupancy high also drives rents.” Schmitz says they plan to bump up rental rates by 4 percent on renewals and up to 5.7 percent for new tenants.
Despite recent increases, new-home inventories remain near all-time lows and are unlikely to return to their highs any time soon, according to a new analysis by John Burns Real Estate Consulting.
The rise in single-family inventory levels over the last few months bring them back only to 2012 levels. What's more, the supply of condos continues to be at record lows, with fewer new high-rise developments and condo conversions occurring now than in the mid-2000s, John Burns Consulting says.
From 1984 to 2014, there was an average of 9,900 units on the market. The current inventory is 72 percent below the average of the last 30 years and 79 percent below the average since 1971, Pete Reeb, senior vice president at John Burns Consulting, notes in a recent article for the firm.
Why are new-home inventory levels so low, and why will supply not likely reach the previous highs? John Burns offers the following reasons:
Decrease in available lots. Los Angeles, Orange County, and San Diego, for example, have less land for large-scale new-home developments than five years ago. Fewer master-planned communities will lead to less supply.
Fewer overall projects. With fewer projects, there are fewer units coming on to the market. Actively selling community counts are far lower today than 10 or 20 years ago, Reeb notes.
Lower unit counts. The average total number of units in a project has significantly decreased in the last three decades. For example, in San Diego County, project sizes have dropped from a median size of around 125 units per project in the 1980s to 59 units today. "With fewer units per project, there are less total units to bring to market," Reeb says.
Tight construction financing. Lenders now often require builders to have 50 percent to 100 percent of units under contract before releasing funds for the next phase. That has greatly reduced the potential for overbuilding, Reeb says.
Contact your local RE/MAX Realty Center Agent Stacey Guzanick 262.490.3696, Guzanick@gmail.com, if you have questions about buying a house or selling one. I can guide you toward your next home.
