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HGTV recently aired a special program entitled “25 Biggest Real Estate Mistakes” which featured experts in all aspects of real estate: agents, mortgage lenders, home inspectors, flippers and stagers. The experts opined about the top reasons a listing lags on the market. Catch the full list here. Better yet, watch for a rerun on HGTV.

The usual suspects were included:

• overpricing the house,
• not providing easy access for showings,
• FSBO,
• overdoing the remodeling for the area,
• not marketing your property, etc.

The #1 Biggest Real Estate Mistake?? “Failing to Stage and Showcase Your Home.” This validates the home stagers of the world!

A quote from the HGTV website:

“When you are selling your house, you have to really look at it objectively and think about it from the viewpoint of the house hunter. Make minor enhancements to the house and maybe hire a professional stager to come and arrange your furniture. Staging is about decorating your house for the buyers’ taste, not yours. A great place to start is with the front of the home and the main entryway. Home staging is designed to increase the potential selling price and reduce the amount of time the house stays on the market.”

There you have it. Stage those listings! It is the most efficient and cost-effective marketing tool available to Realtors and home sellers.

Go Tigers!

Happy Mother’s Day to all of the Oakland County (and farther afield) mothers out there. Gloomy as our weather here may be, I hope it is a special day for all.

We’ll now return to our regularly scheduled real estate discussions. There is a Mother’s Day tie-in since today is Sunday, open house day across America.

Recently, on one of the many listing appointments we were on in the last month, a seller asked me about our planned schedule for doing open houses at his home. Somehow, in my presentation on how the lion’s share of buyers are searching the Internet for homes and that our marketing strategy offers about the best Internet marketing available to home sellers in the Metro Detroit area, I left off the basics about open houses.

Open houses are old school…

The number one thing open houses do is give the Realtor access to potential buyers… of other people’s houses. Afterall, the people who come through open houses typically don’t even know the price of the home they are coming into, so they are not qualified buyers. Often they are curious neighbors or people who just like to check out decorating styles. Yes, some are qualified buyers, but it 8 years of holding what seems like close to a thousand open houses, we have sold exactly 2 of the homes we were in from the effort That makes the odds pretty low.

My time marketing your home can be better spent than holding it open

You are better off with me spending 3 hours getting great pictures, building a virtual tour, building a web site for your home and syndicating your home to all of the sites we use. Actually all that takes a lot longer than 3 hours, but we see a higher payoff from the efforts. We are contacted by QUALIFIED buyers and their agents. The buyers have seen about 25 photos of your home, so they have a good sense of what they are getting into before they even cross the threshold.

If open houses are central to your agent’s strategy to sell your home, you either have a very special situation (I can’t imagine what it is, but I will leave room for the possibility) or your agent might be without better tools in his home marketing toolkit.

Yes, that headline is correct. Sales are up over last year for the fourth month in a row, according to our MLS, Realcomp II. We’ve told you, we are seeing a lot of activity, and we are busier than ever. Spring has sprung! Here is Realcomp’s report

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• Yesterday I tried to show 4 Birmingham homes. Two of them went under contract over the weekend. The third was a short sale and there is an offer in it too. The 4th was just put up for rent and sale, and a tenant had put in an application. So we will keep looking because others got there before we did.
• An agent who I respect enormously for his market knowledge and decades of experience said to me last week, “2008 will be the year that people look back and wish they had bought a new home.” I think he is right.
• That said, a seller still needs to be aggressive in pricing a home and completely on top of making sure it is in the best possible condition. Especially with homes that have already experienced a long marketing history. We just had a stager go into two homes and I am excited about relaunching them now that they have been freshened up and repriced.
• Buyers, there is nothing wrong with paying full price or more. Sometimes the house is actually worth more than the list price. You might miss out on a great house because you’ve been told that your first offer in this market needs to be low. Agents from throughout South East Michigan are all telling me that they are seeing multiple offers on the best properties this Spring (if it is well priced and in great condition…)

Want to know more? Give us a call.

In today’s Metro Detroit real estate market, there is almost no way a prospective buyer cannot run into a few short sale properties or foreclosures during a home search. Each is much different from a standard “retail” home purchase where you are working with Susie and Sam Seller, their agent and your agent.

In a short sale you have at least one other interested party: the bank. Quite often you have two banks if there is a first and a second mortgage. You may also have bankruptcy courts and lawyers, but we will leave those for another post.

1. Typically, your first round of negotiations is with the home owner. Once they have arrived at a written agreement with you, they will submit a short sale package to the bank(s) for consideration. A complete short sale package will include things like your offer and preapproval, a current CMA, the seller’s financial statement, hardship letter, tax returns, a seller’s net sheet and w2’s.
2. The bank(s) will send out an independent agent to provide a broker’s price opinion. This will give the bank a better sense of if the offer is reasonable or not.
3. You will usually have a lot of waiting and uncertainty to deal with. Hopefully your patience will be rewarded with a speedy approval, but be prepared for a wait.
4. The bank can counter the offer you have with the seller. If they feel the property is worth more, they might ask you to come up in price.
5. Some sellers will continue showing the home and presenting other offers to the bank after they have accepted yours. Have your agent ask the seller’s agent what he plans to do once your offer has been accepted just so you know.
6. If a sheriff’s sale is scheduled while your offer is being reviewed, the listing agent can ask to have it postponed until after your closing date.
7. If the sheriff’s sale has already taken place, you need to close before the redemption period expires or the deal is off.
8. The listing agent is very important in a short sale. She will be contacting the banks on regular basis for status updates and to keep the file moving. I have been known to call a couple of times a day. Or fax. Or email. Or all 3…
9. The seller may have some extra emotions associated with this sale since it has likely been a stressful experience. They’ve probably been dealing with the bank and difficult personal financial issues for months.
10. I typically write my buyer’s purchase contracts so that they do not have to pay for things like home inspections or appraisals until AFTER the bank has provided approval.
11. The reward can be worth the wait for those buyers who have the patience and nerves.

I’ve learned a lot from each short sale we’ve completed. Every bank is different. Every loss mitigation officer is different. Most are overworked and underpaid. Being nice, and presenting a complete package go a long way.

Short sales are here to stay for a while. You can steer clear, if the uncertainty is not for you. Or dive in with your eyes wide opened if you’ve found the home you want.

PS. Dmitry and I have attended numerous training courses on short sales and we are short sale certified.  If you are a Oakland County home seller in need of a short sale, we may be able to assist you.

Kris Wales, a great Realtor and blogger, has just launched Chat About Macomb. Take a look. Kris is a great writer with lots of insight about living in Macomb County.

Dmitry and I have had our busiest Spring in real estate in years in 2008.  We are working with more clients than ever before.  Last week we had a couple of closings and we asked the other Realtors and mortgage brokers if they were seeing what we are seeing: a lot more buying activity in the market.  The answer was YES!

It’s too soon to say that the market has turned.  As I have long stated, South East Michigan needs to create jobs to stimulate an enduring stabilization in the housing market.

Still, here are a couple of things we have observed:

• The supply of rental properties is actually decreasing.  Cautious would-be home buyers have delayed their home home purchases waiting for the market to bottom out.  With a few years of falling home prices behind us, it is easy to understand their reasoning.  The challenge for them will to be to time the market and purchase before the market starts heading up.  With rental supply in some segments drying up, this creates an opportunity for investors who wish to be landlords, and it forces some of the cautious tenant/would be buyers to take the leap back into home ownership.
• The last 5 of our most recent sales have involved multiple offers.  There are buyers out there, and if they see value, they react.
• The condo market remains amongst the most challenging for sellers.  Sellers of condos are often more profoundly impacted by their neighbors sales prices than sellers of single family homes.
• Today’s buyer is still VALUE oriented.  Buyers want a deal.
• There are some great homes out there!
• It seems that prices are down, but sales are up.  To me, that is the beginning of stabilization.  As supply falls, prices should begin to level out.   It will take a while for us to return to the record high values we experienced in 2004/2005.

Opportunities exist for sellers and buyers right now.  Be prepared, informed and open minded, and you’ll be one step closer to the finish line.

On Tuesday April 29th, the Birmingham Bloomfield Realtor Network is having it’s Spring Flowers tour from 10 to 1.  Visit LastTuesdayTour.com for more information.

We are also excited to be sponsors of the 2008 Birmingham Farmer’s Market.  The market is a favorite with all of us.  Our members will even be there to greet you 5 weekends throughout the season:

• Renee Acho
• Kevin and James Cristbrook
• Michael DeForrest and Kristi McAuliffe 
• Frank and Julie Flynn
• Maureen Francis and Dmitry Koublitsky 
• Cindy Kahn
• Sara Lipnitz
• Rebecca Meisner 
• Chris Pero

The BBRN represents the largest real estate offices in Birmingham Bloomfield market (SKBK Sotheby’s, Max Broock, Hall and Hunter, Hannett Wilson & Whitehouse and Weir Manuel). It’s a super collaboration. 

More on our sponsorship later, but be on the lookout for us on Sunday mornings at the market! 

I really like my little Plugoo thingy that sits in the center column of my site. But sometimes I forget to turn it off when I walk away from the computer. You might send me a message and I might not see it until I come back later.

Other times I forget to turn the thing on at all. So people send me messages through it, hoping for a response. Unfortunately, most of them forget that I don’t know how to contact them unless they leave me a phone number or email address.

Other times, I am actually at the computer, but in the middle of doing something else. In order to help YOU more efficiently, and quickly, I might ask you to pick up the phone and call me. Don’t construe that as a “high pressure sales technique.” I am about as far as you can get from a high pressure sales person. If you decide that I can help you, super. Let’s talk. If not, that’s cool too. Sometimes I just can’t sit in front of the screen for 20 minutes typing back and forth trying to figure out what you need. Most of the time, the same thing can be dealt with in a 4 minute call. Don’t worry, I won’t call you again unless you ask me to.

I look forward to our next “chat.”

After an excruciatingly long winter, I hereby declare… gratefully and optimistically… that spring is finally here! The birds are chirping, the trees are budding and the baseball season has begun.

In the real estate world, this means the time has come to kick curb appeal up a notch.

In a buyer’s mind, the home’s exterior reflects the condition of the interior. If that first impression doesn’t “wow” the buyer, they may assume the interior is not worth exploring. Worse, if it indicates an overwhelming amount of yard work that will need to be done upon moving in, it’s likely they will move on to the next home on their list. Many fabulous homes have been passed by because a potential buyer has found the initial view unsatisfactory.

Much is made of staging the interior, with good reason, but you have to get buyers in the door before they can fall in love with the house. Tackle the following jobs and increase your showings:

• Clean up all branches, sticks, leaves, and animal droppings from lawn
• Prune bushes
• Deadhead perennials and pull weeds
• Add fresh mulch to beds
• Over-seed bare patches in lawn
• Sweep porch and walkways
• Take a good look at the front door, door knobs, and mailbox—paint or replace if they are showing signs of wear
• Wash windows and screens; tighten or replace screening if necessary
• Make sure address numbers are highly visible from street
• Plant colorful flowers in beds and add planters to front porch (pansies are cold-tolerant and available in stores right now!)
• Power wash siding, garage door and all concrete surfaces to remove winter grime
• Seal your driveway with a fresh coat of asphalt
• If the house boasts a deck or patio, show it off! Clean outdoor furniture thoroughly and create seating and dining areas. Add planters. Don’t overlook this important bonus living space!
• Likewise with porches, balconies and courtyards—invite visitors to relax and sit a spell with a sturdy chair or two and perhaps a small table
• Speaking of decks, stain and seal if needed
• Bite the bullet and have the exterior painted if it shows any signs of fading or peeling—it will be money well-spent

So, get out your rakes and pruning shears and get busy. Invest some money at a home improvement store. Consult with a professional on jobs that are beyond your expertise or comfort level. Be proactive to get more showings. Get dirty!

And please, please…change your MLS and marketing photos to reflect the change of seasons. In addition to being a dead giveaway of the listing’s time on the market, winter photos are usually far from flattering. Besides, no one wants to be reminded of the winter we’ve just endured!

Remember, the outside is the first and last thing the buyer sees. Make it inviting!

Go Tigers!

This just in from MCAR, our board of Realtors.

Sales figures for March cooled off a little from the previous two months. In February, for example, sales in Oakland County were up seven percent year-to-year. For March, sales dipped four percent. One likely culprit: the fourth snowiest March since 1880. And home buyers that may have been more active in the February-March timeframe might have accelerated their buying schedule to take advantage of zero-down mortgages before banks largely stopped offering the option in January.

Oakland municipalities* experiencing year-to-year increases in March sales included:

• White Lake Township, up 35 percent
• Southfield, up 31 percent
• Birmingham, up 29 percent

Last month, it was Birmingham that posted across-the-board positives. This month, it’s White Lake Township: sales volume was up 68 percent and the median sale price jumped 64 percent, while listings decreased nine percent.

Oakland municipalities that experienced sales drops include Rochester Hills (down 42 percent), Commerce Township (down 23 percent) and West Bloomfield Township (down 17 percent).

And Oakland County listings declined 14 percent from March 2007, following a decline of four percent in February and a modest 0.5 increase in January.

For the complete report, follow this link.

polar bear, originally uploaded by Maureen Francis.

Been to the Detroit Zoo lately? No school today, so we took a rare family trip to the zoo to enjoy the first days of spring. The polar bear exhibit is one of our daughter’s favorites, and today we were lucky enough to catch this guy swimming in the water right over our heads!

I am clipping an interesting portion of an email just received from the Michigan Association of Realtors, witha bit of good news for those home sellers who are carrying two homes in Michigan.

Yesterday, Governor Granholm signed 3 significant pieces of REALTOR® supported legislation. First, legislation enabling home sellers to retain 2 principal resident exemptions for property still on the market after the seller has moved elsewhere in the state. The signing of this legislation is a huge step in aiding struggling sellers who have had homes on the market for over a year and have lost their principal residence status on that property.

House Bill 4215, now Public Act 96 of 2008 sponsored by Representative Ed Gaffney (R-Grosse Pointe Farms) enacts that the seller can retain an additional exemption for up to three years on property previously exempt as the owner’s principal residence if the following circumstances are met:

• the property is not occupied,
• the property is for sale
• the property is not leased or available for lease
• the property is not used for any business or commercial purpose

The Michigan Association of REALTORS® (MAR) was active in pointing out to lawmakers that the struggling economy in Michigan has forced several home sellers to relocate to other areas of the state, in some instances continuing to market a home that they have not lived in for over a year. As a result, the home was no longer treated as a principle residence and the homeowner lost the principal residence exemption. Retention of an existing homestead credit for an unoccupied home that is currently for sale would offer relief to sellers who have had to relocate for whatever reason. The MAR is grateful to Representative Gaffney for being receptive and following through on this very important piece of property tax relief.

I am left with a few questions after reading this.

1. If the seller has moved out of state, are they eligible as well?
2. Does this take place now?  The May 1 deadline for removing or replacing a property tax exemption and having it impact the coming tax year is almost upon us, so some people may need to rush to replace the exemption.
3. Can a previously removed exemption now be replaced?  I assume the answer is yes, but I don’t know.

Clearly, this is a great benefit for those who qualify.  The audience is probably limited, at least in Metro Detroit, where we are seeing transferees leave the state.  Also, many of those who would prefer to sell have turned to leasing in order to reduce their cash out flow each month.  These reluctant landlords will not benefit either.  This could actually help to reduce the number of rental homes coming to market, though I don’t think it will have a significant impact there.