When I was getting started in Real Estate, I really didn’t have any clients. I had moved to Austin 7 years before with my wife, but it was in a different field, and I didn’t have the largest circle of friends. I didn’t know anyone in Real Estate, except for the Realtor that sold us our first house. I was convinced that I wanted to be successful, and I knew that I could, but I didn’t really know where to begin. (more…)
I’ll never forget my first sale. It actually came as a referral from a colleague of my wife. They were an older couple who needed to downsize from their home, and wanted to move into a fancy retirement home. All their life they had been working hard, and now that they were older, they just wanted to be taken care of. (more…)
The other day, I advised my clients to reject a contract for an unexpected reason, the option fee submitted was too low.
When I get a receive an offer on a house there are a bunch of things that I immediately look at and use to evaluate if it is an offer that I will recommend by clients accepts or reject
- The sales price
- The Financing. Is it a cash offer or will there be a mortgage?
- The Earnest money amount
- When is the closing date
- The Termination option (or the Option Fee, as it is commonly called)
- Who is paying for the title policy
- Who is paying for the survey
- If there is a residential service contract being asked for, and who is paying for it.
Each of these 8 things are totally negotiable, and cost money that comes out of someone’s pocket. And as a seller of a house, you can reject any offer based on any reason. So be sure to carefully evaluate everything and make sure it is to your liking, because once you are under contract it is hard or even impossible to change things.
The buyers have a few more options to get out of a contract than the sellers. But as time goes on, they get more expensive. There are two different points where a buyer can cancel a contract. The first is at the end of the option period, and the second is after that, but involves loosing their earnest money (and possibly more).
As soon as a contract is executed, the clock starts ticking. You are in escrow, and each side has a bunch of things to do, as outlined in the contract, to make sure everything happens by the closing date. You can’t back out, unless…
Unless you use the option period. The option period is a short amount of time at the very beginning of the contract that the buyer can purchase. Option checks can be anywhere from $250 – $1000 or more, and generally last a week. That’s 7 calendar days (not business days). During this time, the buyer can back out of the contract for any reason, and all they loose is their option check.
Since this is a way out of the contract, I like to see a higher option fee, and the other day I advised my clients to reject an offer because the option check was only $50.
I didn’t want my listing to be tied up for a week while they decided to kick the tires of the house. You see, if the house is under contract, you can take backup offers, but the first contract is the one that has to be done first.
Right now Austin is in a deep Seller’s market. There are a lot of people looking to move to Austin, and not a lot of places for them to live. If they are serious about buying a house, they need to back it up.
I’ve been burned before at the last minute by buyers cancelled out at the very last minute because they get cold feet. It is a waste of time for everyone involved. Of course it is their right, but it costs them money. And I believe the higher the option fee, the more serious they are as buyers.
After the comprehensive marketing has successfully found a qualified buyer who submits an offer, there are still many important steps to be considered and handled. Maybe just one offer will come in, but my clients usually get multiple offers, which need to be analyzed and negotiated.
In Austin’s housing market today, when your house is properly priced, and successfully marketed, you most likely will receive multiple offers. What exactly is a multiple offer situation? It’s one where you, as a home seller get to choose from several people who are interested in buying your home, and have submitted an offer.
In a multiple offer situation, you will need to choose which offer you want to move forward with. Sometimes the choice is easy, more often there are confounding factors that can cause problems down the road. Here’s a situation I found myself in a little while ago:
A house was priced at $695,000, exactly in line with the neighborhood and style of home. After a little less than 2 weeks after listing it, three buyers were interested and submitted offers:
- The first offer was for ALL CASH, but was at $675,000
- The second offer was for full price, but the buyer was trying to qualify for a Jumbo loan with 3% down.
- The third offer was for full price, but the buyer was putting enough down to only need a conventional mortgage.
Once you have received and accepted an offer, escrow begins. This is the time of deadlines and paperwork. Typically the buyer has more paperwork to do, because they have to get their finances in place, but there still are steps the seller needs to do, and I’ll make sure everybody stays on task, and gets their job done in time for closing.
In addition to keeping you updated of where we are in the process, I’ll communicate with the buyer’s agent and follow their process, working to avoid common pitfalls, and prevent disappointments.
After successful negotiations, and choosing the best buyer from a multiple offer situation, and following Escrow, when everything needed for closing has been prepared, we sit down to sign the paperwork. If you are in town, I’ll attend the closing. Alternatively I can be available via phone, or Skype, if you are out of town, to answer any questions.
I’ll guide you through the paperwork, explaining everything you are signing, and review each document for completeness.
How does one communicate they are a great negotiator? I really don’t know. All I can do is let you compare my website, with that of ANY other Real Estate Agent. I try to let my personality show through, here, and in the signing room. I know my stuff, and won’t get caught flat-footed, which ultimately could loose you money.
Successfully selling your home is more than just sticking a sign in the front yard, and entering some data into the MLS. I’ve learned that getting the best price means attracting as many possible people to view your home as possible, and I use every possible method to accomplish that goal.
Once your home has been properly prepared, I’ll schedule a professional photographer who has experience in photographing homes to take incredible photos which will be used in all the print and web marketing materials. When required, I’ll also pay for a professional film crew to come in and prepare a video of the property to supplement the full color photography.
Once the photos have been edited, a graphic designer will prepare high-end, full color flyers, postcards, and print advertisements showcasing your home, and describing all the best features to buyers.
Studies have shown that approximately 90% (source) of all people searching for a new home begin their search on the internet. Lots of realtors provide a custom website, however without the proper traffic, that never gets seen. I have the most popular Real Estate Blog in Austin, and will feature your property on the front page until it sells. I’ll use social media and share the listing with my Facebook friends, and Twitter followers. All this is included in addition to the regular MLS and syndication that gets your listing to appear on all the popular real estate websites, and searches.
In addition to all the web based marketing, I also use traditional print advertisements like newspapers and high-end magazines to showcase your property, to reach the other 10%. Even though print advertising is dying a slow death, your property will still be featured in a full page ad in the Austin American Statesman, as well as other publications like Tribeza & Austin Monthly, as needed because I want to reach 100% of the people.
Plus, I mail out custom postcards to my network of other Realtors, Investors, previous clients, and even neighbors informing them of a new listing, and encouraging them to tell their friends that a new house is coming up for sale in the neighborhood.
Finally, I hold your house open as much as possible using highly visible directional signs to guide drivers to see the house. Since we have prepared the house to look fantastic from the street, more people will stop in, and take the next steps, ultimately ending in an acceptable offer.
The goal isn’t just to reach people who are actively looking for a home to buy, but also their friends and family, to help spread the word.
Choosing the Best Realtor:
Frequently, your home is your largest asset so choosing a Realtor is an important decision. In Austin, you can’t throw a rock without hitting an Agent, but you want to be sure your Realtor has the 4-E’s of Real Estate education, expertise, enthusiasm, and experience, to get your asset sold for the best possible price.
The first thing buyers and Realtors do when they are interested in your home is to drive past it. This is where we make our first impression. I like to evaluate your house from the street in 2-ways. First from the vantage point of a driver on the street. If it doesn’t look good from this angle, people will keep on driving. Second, I make sure the path from the curb to the door is spectacular – nice landscaping, leaves swept up, and even the doorbell, and doorknob cleaned. It’s these little touches that make a difference.
Cleaning & Making Repairs:
These are minor repairs that may be red flags on an inspection report, or simple cosmetic touch-ups that can be done in a weekend. Oftentimes these simple fixes give a return of over 100% on the investment. This can include washing windows and baseboards, touching up door frames and cabinets, and other small fixes. I also recommend a deep cleaning including the kitchen, bathrooms, and floors, to make the house look as fantastic as possible.
Improving the Right Areas:
Generally I don’t recommend putting a lot of money into making significant upgrades if you are going to be moving out. It is true that a lot of home buyers don’t want to do a lot of work when they buy a house, however the wrong improvements just get ripped out and redone. I can provide specific guidelines if you are thinking or remodeling to get more money when you sell.
Making the Interior Shine:
A recent study proved that a house that is staged can get up to 5% more than those that were not. On a $200,000 house that’s and extra $10,000 and on a million dollar home that is $50,000. In addition, staged homes sell faster, too.
Texas law requires home sellers to complete a disclosure form communicating the owner’s knowledge of a property. Failure to do so, or lying on the form can lead to a termination of the contract, or penalties if fraud is proven.
Finding the Right Price:
Correctly pricing your home can be a touchy subject. I base my recommendations on actual sale prices of similar homes in your neighborhood with comparable prices. I do not base my price on what your next door neighbor is listing their price for. It’s been proven that an overpriced home can sit stagnant on the market for months, while an accurate or even slightly underpriced home can attract multiple offers, and even sell for more than the asking price.
Marketing your Home:
My successful marketing techniques include print, mail, and web advertising, which reaches the widest possible audience. I want to maximize the exposure of your home to attract the most qualified buyers. For a complete description of all I can do for you, please contact me today.
Every week until your house sells, you will receive a report detailing what has been done to market your house. It will include web views, number of visitors if an open house was held, as well as if any other realtors showed the property to interested clients.
A well marketed home will attract lots of interested parties. Ultimately one (or more) will submit an offer, and negotiations can begin. I’ll notify you immediately when an offer comes in, and guide you through the next steps.
Closing the Deal:
Once you accept an offer, and the property goes “under contract”, I’ll manage the process of all the paperwork, and ensure the proper documents are submitted in a timely manner to title companies, and other required agencies.
I will be available during the actual closing to answer any questions you have about signing the paperwork, of course.