Featuring Mary McDonald

HOME-COURT ADVANTAGE:
Winning strategies for attracting buyers in today's softer market

by Mary Ellen Podmolik
Special to the Tribune
April 7, 2006

The Cary home that Maria Victoria Zitelli shares with her family is spacious, at 3,600 square feet, and has amenities like a gourmet kitchen with an island and breakfast bar, soaring ceilings and 2 1/2 bathrooms.

But when it came time to list the 4-year-old home for sale a few weeks ago, Zitelli, a former real estate agent, looked beyond her comfortable home to face the reality that after five stellar years, the residential housing market is slowing.

So first Zitelli had her listing agent take her to comparable homes to check out the competition, and then priced hers slightly lower than a direct competitor with more upgrades. She then repainted the upstairs, trading white for putty and neutral shades of green and yellow. She put away accessories and brought in plants and orchids. She rearranged the furniture. And every morning before she left the house, she made sure it was immaculate and all the lights were left on.

"It looks great," Zitelli said. "You have to give it some oomph. Because I'm a Realtor, I know the first two weeks are critical."

With mortgage rates edging up to their highest level in three-plus years and total housing inventory at its highest level since 1998, some homeowners are nervous as they put their properties up for sale. "The people I'm working with are almost kind of frantic, [asking], 'Are things moving? Are interest rates too high? Are people going to buy,'" said Kim Vales, an agent at Baird & Warner, Orland Park. "They are anxious and apprehensive."

But rather than fret, real estate agents say there are a number of steps sellers can take to increase the chances that their home will sell, not sit.

Price it realistically. Real estate agents say it is here that sellers make their first, and perhaps biggest, blunder. The days of lofty price appreciation and buyers lining up outside the front door to outbid each other are waning to a close.

A listing agent will provide sale prices of similar homes for the past six months to a year, but it's important to compare conditions then to now. For instance, six months ago, was that similar home the only one of its kind available and now there are several like yours?

Check out the competition to see how similar properties are priced and how well they show. Also, keep in mind that if a home is priced at the higher end of a group of similar homes, buyers walk through the front door expecting more.

"If you don't have 10 showings in the first two weeks in a fairly active market, the house is priced too high," said Mary McDonald, an agent at Re/Max Unlimited Northwest in Cary.

If you are determined to test a slightly higher price, test it for two weeks and then re-evaluate it. Don't wait more than a month to drop the price, agents say.

Use the Internet to your advantage. Keep in mind how people look for homes in a computer-savvy age; they like round numbers and photos. Pricing a home at, say, $484,000, automatically excludes the listing from searches for homes listed for $450,000 to $475,000. And potential buyers doing searches for $475,000 to $500,000 are going to expect that $484,000 home to have the features of one priced higher.

Allow a real estate agent to take photos or put together a virtual tour of the home too. The more photos, the better, agents say. Make sure there are interior pictures of the kitchen, family room, living room, master bedroom and master bathroom; potential buyers may think there's something amiss if some of those rooms aren't shown.

Consider incentives. Agents say the market isn't at a point where sellers need to tap into their profit margin too much. However, think about offering a home warranty if the appliances are dated. And if it's a property such as a condo that will appeal to first-time buyers who have no equity elsewhere, an offer by the seller to pick up some of the buyer's closing costs may set that condo apart from similar units.

Showcase the home's interior. That means more than cleaning out closets and removing refrigerator magnets. Some listing agents stage their client's homes for free; other brings in professional stagers. The goal is the same, to update the home and give it a warm and inviting personality, just not that of the seller.

"The hardest thing for people to get past is it's no longer the place you raised your children and you have these great memories," said Julea Joseph, owner of Reinventing Space in Palos Park. "It's a product like something sitting on a Target shelf."

If wallpaper is dark or the pattern is too busy, rip it down. If walls are white or boldly colored, repaint them. Think neutral colors like warm beiges, greens and creams. A worn couch no longer makes a room look tired if it has a new slipcover. A new area rug can cover old tile. A shiny new bathroom faucet gives a dated sink new life.

"If things are outdated, you can mask it with staging," McDonald said. "They've decided when they walk in the door if they even like the house. They'll make up excuses and say we can fix that. They'll see a rattan rug over [bad] tile and say it's dated but we can replace that."

Don't forget the outside. It's tough when spring is just beginning to sprout in the Midwest, but little fixes go a long way. Keep a pot of colorful pansies right inside your front door and place them outside before a showing. Buy a new doormat. Rake leaves left over from fall.

"The time standing there while the Realtor gets the door open, that's the first impression people get" of a home, said Fran Bailey of Baird & Warner, Arlington Heights.

Be flexible. Don't expect to sell your home just by having an open house. "Ten percent of the people that come through the property are potential buyers. The rest are lookers," said Ed Schwind, of Schwind Realty and Development Inc., Chicago.

Agents say the more open you are to having strangers in your home and the more you're willing to put up with inconvenience, the better your chances of selling it quickly. That means don't put restrictions on the listing, such as requiring 24-hour notice before a showing. It eliminates out-of-town buyers who are looking at many properties.

Also, don't require the listing agent to attend each showing. It may make a seller feel more comfortable with having strangers in the home, but it to can lead to lost showings.


Copyright (c) 2006, Chicago Tribune.  Reprinted by permission.