Limit the trendy

Limit the trendy updates when renovating your home. If you’re renovating your home to prepare for a home sale, or for your living pleasure, there’s an overwhelming sense of excitement and creativity focused on the finished product.  You may already have a vision of the design for the room and fixtures.  Or you may decide to hire an interior designer (or certified home stager) to assist you with the project. Regardless of the route you take, take heed to design trends, as some are more fleeting and personal than others and could hinder your home sale.

limit the trendy renovations
Top renovations

One definition of “trend” is current style. Meaning that although a design or style is hot and desirable today, it won’t be in the near future. If you’re updating the home to live in a few years then sell a few years down the road, consider that any update you make today could seem outdated to home buyers in the future. Knowing this could help reign in your current budget, and budget for additional updates down the road.

If you’re renovating to sell, be careful to cross over the line of over-personalization.  Over-personalized spaces/rooms/homes can turn off home buyers.  Home buyers get distracted from the space of the home when they see updates, designs, and/or fixtures that they don’t like.  “Look what they did here…” seems to be an automatic response I hear when viewing homes with clients who get distracted.  Of course, distracted and otherwise turned off home buyers typically won’t pursue that home.

If you’re enticed to design by the latest and greatest trend, keep in mind that most home buyers are more interested in homes they can picture living in.  A January 17th article from the NAR blog (“The Most-Hyped Home Design Trends for 2022; Home design is reflecting much more personality, from black accents to textures galore, by Krisztina Bell, No Vacancy Home Staging Inc.) has a comment about “maximalism design: “Maximalism is back, if the 2022 fashion shows are any indication. More people are seeking to surround themselves with objects that reflect their personality. We’re seeing expressionistic lighting—like geo-shaped groupings and swirls—as well as an explosion of colorful rugs. It’s popular to mix vintage pieces with contemporary furniture and colorful glass. Put a disco ball in the basement and add tinsel curtains for even more sparkle. That’s just how bold decor is getting. But don’t go overboard with ’70s decor! A few playful and unexpected pieces is all you need for this trend.”

Ms. Bell’s words of wisdom “don’t go overboard”and limit the trendy should be the rule when renovating.

By Dan Krell
Copyright © 2022

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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

Creating home staging vision

home staging vision
Creating home staging vision (infographic from nar.realtor)

Although home staging has become entrenched in the home sale process, it doesn’t have to be a pricey way to prepare your home sale. Not only has it become part of the home seller experience, the home staging vision is now expected by buyers and their agents when they visit homes. 

The spring home sale season is the perfect time for the National Association of Realtors to roll out the results of their 2019 Profile of Home Staging survey (nar.realtor).  In a March 14th press release, NAR President John Smaby summed up this year’s profile by stating, “Realtors understand the importance of making a residential property as welcoming and appealing as possible to potential buyers. While every Realtor doesn’t use staging in every situation, the potential value it brings is clear to both homebuyers and sellers.” 

Staging may affect a home’s time on market, and it’s likely due to visual cues.  Meaning that home staging vision helps the home buyer picture themselves living in the home. More than half of the agents who responded to the survey indicated that home staging reduces time on market.  Forty percent of buyer agents said that home staging effects most buyers’ perceptions of a home.  Eighty-three percent of buyer agents believe that home staging vision makes it easier to visualize living in the home.

It’s not surprising that agents agree that the most staging attention goes to the living room, kitchen, master bedroom, and the dining room.  It’s not that these rooms have special significance, but rather it’s because it’s where people spend most of their time in the home.

The NAR survey also found that real estate TV shows has impacted home buyers’ views and expectations.  Thirty-nine percent of buyers indicated that they experienced a more difficult home buying process than what they expected.  Twenty percent of buyers reported being disappointed that homes they visited didn’t look like the ones portrayed on TV.  While ten percent believe that homes should look staged as they are depicted in TV shows. 

Not all agents stage the homes they list for sale.  Only twenty-eight percent of listing agents said they staged all sellers’ homes prior to listing them for sale.  Compared to the thirteen percent of agents who confessed that they only stage homes that they deem difficult to sell.

Does home staging affect sale price?  It was noted that all agents surveyed indicated that home staging affected their home sale positively.  Twenty-two percent of the agents reported an increase of up to five percent in buyers’ offers, while seventeen percent reported offer increases up to ten percent. Only two percent of the agents responded that it increased offers up to twenty percent.

But the idea of staging your home to get top dollar may just be traditional wisdom, as evidenced by NAR’s survey.  One of the few studies on staging revealed that indeed, staging does not have a significant impact on sale price.  Lane, Seiler & Seiler’s 2015 study (The Impact of Staging Conditions on Residential Real Estate Demand. Journal of Housing Research, 24,1. 21-35) concluded that although staging affects the home buying process and the buyer’s opinion and perception of livability, it’s not enough to result in a higher sales price.  The authors stated, “These results stand in stark contrast to the conscious (stated) opinion of both buyers and real estate agents that staging conditions significantly impact willingness to pay for a home. As such, the findings are new and useful to a large group of stakeholders (sellers and agents).”

Original published at https://dankrell.com/blog/2019/03/21/creating-home-staging-vision/

By Dan Krell
Copyright © 2019.

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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

Curb appeal science

curb appeal science
How to increase curb appeal (infographic from keepingcurrentmatters.com)

Curb appeal is one of those “intuitive” topics that only gets media attention in the spring and maybe the fall.  If you search the internet, you’ll find millions of websites that talk about curb appeal.  Because the concept is based on accepted lore, my guess is that most of those sites regurgitate the same ideas.  Everyone has some understanding of curb appeal.  And if asked, they will give you their opinion on improving it to get a higher home sale price.  Everyone agrees that curb appeal can increase home buyer traffic.  And most agree that curb appeal can increase the home’s sale price.  But is there a curb appeal science?

I often present empirical studies to help you understand if widely accepted real estate traditions and principles are accurate.  Unfortunately, curb appeal science is one of those subjects that doesn’t get much academic attention.  Notwithstanding, there are two very compelling studies about curb appeal science.

One of the first studies to empirically confirm the connection between home sale price and curb appeal was published in 2013.  Chen, Evans-Cowley, Rutherford, and Stanley (An Empirical Analysis of Effect of Housing Curb Appeal on Sales Price of Newer Houses. International Research Journal of Applied Finance. 2013, Vol 4 No 11, p1407-1419) examined how a home buyer’s preferences of a home’s exterior influenced the sale price.  Not a surprise, they concluded that there is a connection between a home’s exterior and the sale price.  They also quantified the relationship, saying that even small improvements to curb appeal can increase the value by as much as eight percent.

It’s not just the yard and exterior home maintenance.  Chen’s study also discovered that architectural elements also determine the home’s sale price.  They discovered that the demand for higher cost “modern” homes is relative to what’s contemporary.  Meaning that today’s highly desirable new homes and floor plans could be less desirable and sell for less in the future.

A more recent study went further and developed a measurement of a building’s curb appeal.  Freybote, Simon and Beitelspacher (Understanding the Contribution of Curb Appeal to Retail Real Estate Values; Journal of Property Research. 2016, Vol 33, No 2, p147–161) found that there are three dimensions of curb appeal that can be measured: atmosphere, architectural features and the authenticity of a building. 

A home’s atmosphere describes the general landscape maintenance as well as emotional aspects, such as how relaxing, inviting, and vibrant the home feels.  Architectural aspects rate the visual aesthetics of the home, highlighting modern design and interesting features.  A home’s authenticity relates to its charm and how “genuine” it feels. In other words, can the home buyer picture themselves living there? The study concluded that curb appeal and sale price is not only connected, but can also be accurately measured.  The two dimensions that affected sale price the most were atmosphere and architecture.  The authors also suggested that the atmosphere dimension has a social component (which may be associated pride of ownership). 

Although authenticity was not found to be as influential on sale price, it is notable.  A home’s authenticity (as described in this study) is probably one of the least thought of aspects when preparing a home for sale.  If the home staging, including landscaping and exterior elements, is over-the-top or does not portray the home accurately, a home buyer may be less interested in making an offer and negatively affect the home sale price.

Original published at https://dankrell.com/blog/2019/03/14/curb-appeal-science/

By Dan Krell
Copyright © 2019.

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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

Occam’s razor home selling

Occam's razor and selling a home
Staging is one of the four basics of home selling. (infographic from nar.realtor)

Many home owners are preparing to sell their homes this year.  And in doing so, home sellers are looking for new and exciting ways to sell their homes fast and for top dollar.  But the reality is that selling a home is not rocket science.  There really isn’t a secret trick or approach to selling a home.  Rather, it’s more like magic, where properly performed fundamental tasks can set the stage for a satisfying experience. If you don’t know how Occam’s razor (or what it is) can help you get the most from your home sale, pay close attention.

Unfortunately, it’s a human trait seek a complex solution to a simple question.  In other words, applying Occam’s razer to your home sale can save you time and allow you to get out of your own way.  Occam’s razer is a tool that is often used to figure out solutions and devise scientific theories.  It has become popularized as the “keep it simple stupid” method.  However, Susan Borowski’s history and explanation of Occam’s razor, written for the American Association for the Advancement of Science, gives it teeth (The Origin and Popular Use of Occam’s Razor; aaas.org; June 12, 2012).  Borowski states, “Occam’s razor doesn’t necessarily go with the simplest theory, whether it’s right or wrong; it is not an example of simplicity for simplicity’s sake. It merely tries to cut through the clutter to find the best theory based on the best scientific principles and knowledge at the time.”

In other words, focus on the tried and true fundamentals of selling a home.  Anything above and beyond may not necessarily help to sell the home faster or for more money, but could help make the process more enjoyable.  That in mind, let’s consider these four basic concepts:

First, consider the condition of your home.  Do you have deferred maintenance issues?  Does your home need a makeover?  Homes that get top dollar are “turnkey.”  Many home buyers are willing to compete and pay more for recently upgraded and renovated homes.  Selling a home with deferred maintenance or lacking recent updates can not only turn off many home buyers, but can encourage low-ball offers.  A pre-listing home inspection can help you identify maintenance issues.  Also, consider consulting with a design professional to help you understand which updates (if any) are necessary to help your home sale.

Next, work on the home’s presentation to give it a clean and spacious feel.  Decluttering is one of those tasks that can be overwhelming, but it’s importance cannot be overstated.  Decluttering will force you to decide which items to keep in the home.  Additionally, staging your home can help balance space, furniture and décor.  This can help home buyers envision living in the home.

Deciding on a list price is often a conundrum.  Although enticing, don’t be seduced by the agent who tells you the highest sales price without understanding their rationale.  The housing market can turn on a dime.  If your home isn’t priced correctly, it can languish on the market.  There are many aspects that go into deciding a price, so work with a respected seasoned agent to go through the market details and scenarios. 

Finally, when the home is ready to list, how is it to be marketed?  Today’s MLS listing syndication takes advantage of the fact that most home buyers actively search homes on the internet. Don’t rely on gimmicks that promise activity on your listing.  A complete marketing plan will take into account the factors we discussed here, and apply strategies to attract motivated home buyers.

Original published at https://dankrell.com/blog/2019/01/12/occams-razor-home-selling/

By Dan Krell. Copyright © 2019.

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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

Home sale renovations

home sale renovations
Interior Home Sale Renovations (infographic from nar.realtor)

According to the National Association of Realtors (nar.realtor), the average time a homeowner stays in their home is ten years.  This is higher than the seven-year average prior to the great recession (but is less than the thirteen-year average immediately following the recession).  Needless to say, many homeowners are approaching (or have exceeded) their ten-year stint, and are likely selling their home during the spring and will likely be doing home sale renovations.

Any home sale preparation in today’s housing market should include some home sale renovations.  If you haven’t replaced the home’s systems (such as the roof or HVAC) while you lived in your home, there’s a good chance that they are approaching or have exceeded their average life expectancy.

Additionally, the décor and fixtures in your home are likely outdated.  The home sellers who make the mistake of not updating or renovating before they list inevitably face home inspection issues.  They ultimately find that the home takes longer to sell at a reduced price.

Let’s face it, remodeling can be expensive and overwhelming, especially when it’s for home sale renovations.  According to the NAR’s 2017 Remodeling Impact Report, about $340 billion was spent on remodeling projects in 2015.  Although a majority of homeowners would remodel their home themselves, thirty-five percent would prefer to move instead of remodeling their home.

The Report cited functionality and livability as the top reasons for home sale renovations.  It’s a no-brainer that home buyers prefer homes that are functional, comfortable, and sustainable.  Aesthetics is not enough for a home to be appealing to today’s home buyer, it has to fit their life style.  Additionally, home buyers want efficient systems in their new homes that can help save on utility costs.

Home sale renovations should focus on functionality and livability

What projects will get buyers who will pay top dollar into your home?  It should be no surprise that the number one interior project, listed by the 2017 Remodeling Impact Report, is a complete kitchen renovation.  Other essential interior projects include renovating bathrooms, installing new wood flooring, creating a new master suite, replacing the HVAC system, and finishing a basement or attic.

It also shouldn’t be a surprise that the Report listed replacing the roof as the top exterior project. Other exterior projects in high demand include new windows, new garage door, new siding, and installing a new front door.

If you want to add value to your home, even if it’s not for home sale renovations, check the 2018 Cost vs. Value report (costvsvalue.com).  The report can give you insight to which remodeling projects are the most popular, and estimates how much of the cost you can potentially reclaim when you sell your home.

There’s no doubt that renovating your home can be expensive.  Although the costs of home sale renovations can tempt you to cut corners, don’t.  Cutting corners on renovation projects can actually cost you more.  You may have to repair, or even re-do the project if not finished adequately.  Home buyers are savvy, and can spot low quality materials and poor workmanship.

Also, make sure to get permits when required.  If the home buyer doesn’t ask you, the home inspector will likely recommend that the home buyer check for permits.

Although many homeowners don’t mind a DIY project, many hire home improvement professionals.  When hiring home improvement professionals, check with the Maryland Home Improvement Commission (dllr.state.md.us/license/mhic) to ensure they are licensed contractors.  You should also ask for proof of their insurance, including Workman’s Comp insurance, in case there is an accident on your property while completing the project.

If you hire a contractor who will accept payment when the house sells, read your contract carefully and thoroughly. Do your due diligence.  There may be provisions in your contract that you may not be aware of, such as added costs, charging interest, and setting/lowering the sale price.

Original article is published at https://dankrell.com/blog/2018/11/17/home-sale-renovations

By Dan Krell. Copyright © 2018.

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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.