Lots of Showings, and No Offers. Solve it and Sell it.

PROBLEM:

Your home is (or was) on the market ,  there is  (or there was)  no shortage of showings, but there were no offers either.

I hear  this from many disappointed home sellers after their home failed to sell within the listing period.  Surprisingly enough, I have had listing agents also ask me why this is happening to their own listing.

Three Very Important factors must all be present in order for your home to obtain an offer. If one of these three key elements of salability is missing, your chances of obaining an offer decrease exponentially.

 
It could be one of the three issues that need to be addressed, or a combination of any two. Sometimes it's all three.  But truly, these three are THE ONLY REASONS YOU DON'T HAVE AN OFFER, no matter what  any broker or anyone else tries to tell you.

Marketing: Is your home's marketing geared towards attracting  the most probable buyers? Is  your listing complete and truthful? Does it have current photos that accurately represent it condition and appearance?

Price: Is your home priced correctly? Do you have any negotiating room built in to the asking price?

Condition: Does your home have any deferred maintenance?Does the  exterior or interior  need any  staging?

When we talk about the three key factors in obtaining an offer, remember that if any ONE is not properly positioned, your chances of getting an offer are minimized.

Let's look at a few scenarios:

You could have the BEST house for the BEST price but if the most probable buyers never find it because of improper marketing, you won't get an offer.

If your agent has marketed your home on the most visible websites, and painted an accurate picture of your home, then it's not the marketing. It's something else- either price or condition

Price: The best marketing in the world will not help you to obtain offers on a home that is overpriced for the market.  A slightly overpriced home may indeed get showings,  but NO offers.

Condition:If your agent does a phenominal job of marketing your home,  and the price seems reasonable, it is the condition or the price. This is why feedback is so important on the showings that get. If an objection continues to arise, address it.

By the way, you may have noticed that I did not include location in this list. Location is already addressed by price. So if you keep hearing that buyers don't like the location, it is the price that must be addressed.

Contrary to what many agents will tell you, it is NOT ALWAYS the price. Try to have a neutral mindset and look at the condition of your home, look at the marketing, and make sure BOTH are in line with the market before you  consider adjusting the price.

And a note From Judy: If you would like to sell your home in Fairfield County, have not had any offers, and are in need of an Realtor to represent you, I invite you to contact me, and if you have an idea for a topic that you would like to see on The CT Realty Blog, please include it in the "Post a Comment" section link below this post. We appreciate the feedback and look forward to providing you with the best real estate content, advice and service in Fairfield County, Connecticut.

Why Your Purchase or Sale May Not be Considered an Arms Length Transaction.

You may have heard the term before and thought that it probably did not apply to you, or that it didn't really matter one way or the other. But it can, and it does- and it also applies to your home purchase or sale with non-arms length transaction(s) that were recently consummated in your immediate neighborhood.

An Arm's Length Transaction  has no direct or indirect relationship with any party involved in that transaction, with the few exceptions being Spousal buyouts, an interest buyout of inherited property, or a gift of equity.

A NON-Arms Length transaction (NAL) will have a Conflict of  Interest (COI)  A Conflict of Interest may arise when any party to the transaction has a direct or indirect personal, professional, or financial relationship with any other non-borrowing party.

Some examples of Conflict of Interest include:

The Realtor or Lender is selling  the property you  are buying. Recent developments in lender requirements  may necessitate the need for the buyer  to obtain TWO bank appraisals rather than just one. (Just a note- you may want to negotiate that additional cost  if you are buying a property that is owned by a Realtor)
The Builder of the home is also a Real estate Broker.
The broker or Realtor is representing either him/herself AND the buyer in a purchase or sale.
The buyer works for the lender.
The seller is the Lender's employee, or is related to, or associated with the seller of the property

Here are some examples of  potential NON-Arm's Length Transactions.

Purchasing with intent to "flip" the property.
Properties purchased at auction.
Short Sale Transactions with a recent Notice of Default and a purchase price  that is less than what is owing on the property.
Contractors or sub-contractors as purchaser.
Purchasers  who are in the real estate, financing, or construction trades.
Employee purchasing from an employer, or any parties related by a business relationship.
Parties related by blood, marriage or domestic union or partnership.

Non -Arm's length transactions will have a negative effect on property values, and appraisers can identify them quite easily when appraising a home.  The presence of any conflict of interest  in your transaction should always be disclosed to the other party, and in some instances, it's the law.

If you have any questions about these types of transactions and how they can or may affect you, contact your attorney for clarifications.

 And a note From Judy: If you have a question about buying or selling Real Estate in Fairfield County, and are in need of an Realtor to represent you, I invite you to contact me, and if you have an idea for a topic that you would like to see on The CT Realty Blog, please include it in the "Post a Comment" section link below this post. We appreciate the feedback and look forward to providing you with the best real estate content, advice and service in Fairfield County, Connecticut.

Negotiating in Good Faith. Always Put Your Best (and Honest) Foot Forward.

When it comes time to put in an offer on a home, whether it's a purchase or a rental, always submit your offer in good faith.

Too many times, others do not negotiate in good faith, return calls or emails  as promptly as you or your agent do, and may have hidden agendas as to why they are hedging on accepting your offer, or even counter-offering your bid, and  to top it all off, you may not ever find out what their reasons are.

Recently,  I had a client who placed an offer in on a property where it appeared that the listing agent and owner did not negotiate in good faith, and as upsetting as that may be, it can happen. It's very unfortunate, but you must remember that not everyone operates with the same high principles that you do.

Certainly more often than such is the case, availability is misrepresented, and/or the presence of offers that are "on the table" is communicated to you or your agent in an effort to get you to adjust your price or terms. Sometimes the homeowner "hedges" or bides their time with your offer,  and there is no way of telling what is truly accurate and what is not. Sellers can also change their mind about selling or renting at the drop of a hat. You just have to go by your gut feeling. If you or your agent sense this type waffling is happening, or that there are no other offers that have been, or  just been submitted, proceed with caution, and always have a "Plan B".

What is Supposed to Be Included With Your Home Purchase or Sale?

Whether you are buying a home or selling a home, you can avoid completely unnecessary last minute disagreements at the closing table that can very well escalate into deal-breaking issues by understanding the difference between personal property vs. real property.

Avoid confrontation and issues by

itemizing what stays and what doesn't.

For Sellers: When you list your home for sale, you should be thinking of itemizing what "personal property" will be included in your home sale, and what commonly requested items will not be part of the transaction.

For Buyers:  When you place your initial offer on the property, make sure and itemize all of the personal property that you wish to be included in the sale. Do not assume that everything stays.

Personal Property vs. Real Property

Personal Property:

In regards to a real estate transaction, Personal property, generally speaking, is private or personal  property  or possessions that are"moveable"- that is, it can be easily moved from one location to another. Also referred to as "chattel or "personalty".

A few examples  are as follows: Any appliances that is movable and not built-in.  Blinds, drapes, curtains and curtain rods. Chandeliers, Light fixtures and/or Ceiling Fans.

Real Property
Generally, anything which is part of the land, or attached to the house and is unable to be moved, or cannot be removed without creating damage is Real property.  

The intent and manner with which an item is attached is used in determining whether an article or fixture is real or personal property. If removing the item requires pulling nails, it’s probably real property. (This does not include picture hangers). If something can be unscrewed and removed without leaving any damage, it might be a good idea to discuss this when negotiating the offer.  

A few examples of Real Property:

Built-in microwave, built-in wall oven, an air-conditioning unit that has been built into the wall, a shed on a concrete slab, or a swingset.

......and a little story

I remember conducting a final walk-through with a buyer client a few years back, and everything seemed to be in order as far as I was concerned, and then all of a sudden, my client went from bathroom to bathroom checking the house, and came to me in a near state of panic, because there was no toilet paper in the holders . He thought it was a law that owners had to sell their homes with toilet paper. No, I am not kidding. He was furious until I let him know that there was no such law on the books.

He got over it, but  something that seems so inconsequential to you it could really make life miserable for everyone involved.- and while we are on the subject of some of the smaller things, leaving light bulbs is not mandatory either.

Bottom Line: If it's important to you, put it in writing

so there are no mis-impressions or misunderstandings.

As with everything else in real estate, remember, it’s all negotiable. If there is a unique item you want included in your purchase, ask for it. If you are selling, and the chandelier in the dining room has sentimental value to you, it's best to replace it BEFORE your home goes on the market. That way it won't ever become a bone of contention.

If you have a question about buying or selling Real Estate in Fairfield County, and are in need of representation, I invite you to contact me, and if you have an idea for a topic that you would like to see on The CT Realty Blog, please include it in the "Post a Comment" section link below this post. We appreciate the feedback and look forward to providing you with the best real estate content, advice and service in Fairfield County, Connecticut.

 

Is a Hubbard Clause Right For Your Connecticut Home Purchase or Sale?

Current homeowners who wish to buy another home, but need to sell their home first in order to use the equity as a downpayment can wonder if they should sell the home they own first, or find the home that they wish to buy first, and then start the process of selling their home. In the case of the latter, the homeowner who wishes to purchase a new home should consider placing an offer with a "Hubbard Clause" rider.

A "Hubbard Clause" is a contingency in (or addendum/rider to ) a purchase agreement that expressly conditions the buyer's offer upon their ability to sell and close on another home or property. It is almost like a first right of refusal to purchase the property- ALMOST, but not quite. Think of it like "reserving a right to buy a particular property" while trying to sell the one you own.

While most  buyers and sellers think this just another perk for the buyer, think again. By the way, I can include a number of agents who would tell you that this is a benefit for the buyer, as well. This type of agreement actually benefits the seller much more, especially  in a buyers market.

The "Hubbard" portion of the agreement must have the following two items included in the verbiage:

1. Final Hubbard contingency sale date- That is, the deadline for the buyer to secure a purchaser for their home, so they can move forward with the sale on the home that they wish to purchase.

2. A deadline for the buyer to remove the "Hubbard" contingency if another offer comes in during this period.

There is no national standardized  form for this, nor are there generally accepted statewide forms for "Hubbard Clauses"- rather the forms which are used tend to be much more regional or generated through independent franchises.  There are a good number of agents who just do not like to work with Hubbard Clauses at all, which I do not understand, but it is what it is. I think that if an offer comes in a home where I represent the seller, that we should absolutely listen to it. It's kind of like a back-up offer without having the main one. As long as all the conditions and terms of the sale are acceptable and  we can still market the house, it would be foolish not to entertain such an offer. When I represent the buyer, and if that's the only way they feel comfortable moving forward, I believe it's my fiduciary responsibility to help them get the house that they want.

Buyers:

If your home is not already on the market, be prepared to list it THE SAME DAY that you place your offer in on the property that you wish to buy. You do not have to list it if the homeowner does not wish to entertain your offer, but  if they are willing to negotiate with you, it is of extreme importance to be ready...ready.... ready.

I have to go on record, here- this is not the most cost effective way to purchase a home. Sorry, but it's true. If this is what makes you most comfortable, I am all for that, and will do as you wish. Often times, you will end up paying a premium for the right to purchase a home in this manner,  and you may end up selling your home for less money to satisfy the Hubbard Contingency within the time. allotted.

Sellers:

I do not really see a downside to sellers as long as an acceptable Hubbard addendum allows you to continue to market the home as ACTIVE, and not change its status to anything else. (See FAQ's below)   Provisions must be made  for the instance of  another offer coming  in during the period that the Hubbard is in effect. Usually, giving a buyer 2 or 3 business days to remove the Hubbard Clause is sufficient, so if they are comfortable removing the clause, you will sell it without the contingency, or if they cannot remove the Hubbard, that you are free to sell it to another party. There are no guidelines as to price or terms for accepting another offer unless they are written into the addendum itself. You must just concern yourself with the time frame.

Hubbard Clause General FAQ's

• Hubbards may include unique terms or conditions.

• Understand that homes are shown with a signed Hubbard Clause agreement in place.

• And then, some agents will NOT show homes that have a signed Hubbard Clause

• Some buyers choose to include a Hubbard Clause because they would actually qualify for your home purchase without selling their home, and just do not want to carry two mortgages.  

• Hubbard clauses can be extended by agreement from both parties.

• Regionally, we work with binders first and then formal contracts are prepared within two weeks- Sellers may decide NOT to have their attorneys draw contracts until the Hubbard Clause is removed.  

• The buyer can withdraw their offer entirely with no penalty, unless expressly written in the contract.

• This agreement seems to be more binding  performance wise to the seller than it is to the buyer.

• And in case you were wondering, the name has nothing to do with Old Mother Hubbard, (despite the shoe)

If you have a question about buying or selling Real Estate in Fairfield County, and are in need of representation, I invite you to contact me, and if you have an idea for a topic that you would like to see on The CT Realty Blog, please include it in the "Post a Comment" section link below this post. We appreciate the feedback and look forward to providing you with the best real estate content, advice and service in Fairfield County, Connecticut.

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