Sandra Braunstein spoke today at the Committee on Financial Services regarding challenges facing Community Reinvestment programs.
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With worries over property values falling, and buyers more cautious than ever in light of shockingly high mortgage costs, greater attention might now be focused on a certain overlooked aspect of selling a home:
Curb appeal.
Most homeowners lavish attention on the interior, thinking that prospective home buyers will warm instantly to their neutral colors, updated appliances, immaculate closets and floors.
But if the outside looks so-so, buyers and their real estate agents may turn up their noses and move on to the next property - especially in this real estate market. Well cared for and tasteful interiors are a moot point if no one likes the look of it.
“If we lose them at the curb, they’ll [buyers] never come inside,” agent David Montz said. “If the buyer already has a negative feeling, it will affect how they feel about the house.”
And in many cities where time-on-market can drag on for more than 90 days - a fact of life in the California housing market and other parts of the U.S. for about a year now - homeowners can actually gain an advantage by paying close attention to the external factors buyers may find pleasing.
Depending on the condition of your home, you may spend from a few hundred dollars to several thousands to bring your exterior up to date. Which may seem like a lot, but to the discerning mortgage loan applicant, it can be the difference between a buyer walking in or driving right on by.
Routine improvements you can perform quickly and cheaply include a fresh coat of paint to siding and doors, power washing the exterior or filling the cracks in the driveway and walks. You can continue your “outdoor” home staging by refreshing the landscape as well.
Some homes might need significant investment to overcome visual eyesores that could give buyers cold feet. New windows, siding, and tuck pointing to brickwork can be costly but effective. Such repairs may require a home improvement loan, but if you get the home sold, that’s money well spent.
Don’t overlook your roof, either. The roof accounts for 40-60 percent of the exterior view of your home, and buckled, warped, cracked or otherwise damaged shingles are immediate turnoffs for buyers.
“Buyers will perceive there’s something different about the house,” said Whatley Bush of MonierLifetile, an Atlanta maker of faux wood shingles, slate and tiles made of concrete.
Fixing your roof is costly. But those costs are recoverable.
According to the Value of Housing Characteristics study conducted by the National Association of Realtors, the appealing look of a slate or cedar shake roof can add more than 25 percent to the selling price of a home.
After years of giving short shrift to exteriors, home sellers in the super-competitive sales market in suburban Chicago have been jolted to the fact the outside of a home is important.
Home improvement contractor Robert McDowell of McDowell Exterior Builders in St. Charles, Ill., says that in order to lure Illinois mortgage applicants, home sellers need to “freshen up” the exterior and make it “current with today’s styles.”
“My guess is the majority puts more energy into the interior. But people have to have both a marketable interior and a exterior in today’s selling environment. You can’t get someone through the front door if they don’t like the outside of your house,” McDowell said.
SOURCE: Orlando Sentinel
Though the slowing housing market is bad news for prospective home sellers, real estate agents and the construction industry, it’s actually resulting in increased business for a handful of people in Greater Des Moines.
With the housing slump beginning to become evident in Iowa, businesses specializing in “staging” homes are reporting more demand for their services.
Home staging is “dressing up” or marketing a home to help it make a good impression on potential buyers. It often involves rearranging furniture and artwork, removing distracting personal items and incorporating a few new pieces into the decor.
“The way I live and the way I show my house are different,” said Sharon Hatten, owner of Roomscapes, a home staging firm. “Things that you have in the house for your own comfort, you might have to re-evaluate when it’s time to sell.”
According to a 2006 survey from StagedHomes.com, homes listed for sale without staging spent an average of four and a half months on the market, while homes staged before listing spent less than one and a half months on the market. Costs for staging vary widely depending on where you live. On the West Coast, professional stagers charge upwards of $200 per hour, but in Greater Des Moines, the rate tends to be $50-65 an hour.
“Staging is worth the upfront cost if it gets you an offer sooner,” said Jennifer Gruber, an agent with Iowa Realty’s Jordan Creek office, which hires a local company called Artistic Attitude to stage home listings.
With a growing inventory of homes on the market, staging has never been more popular. According to the Des Moines Area Association of Realtors, there were 6,980 active listings on the market in October, up from 5,937 a year ago. There were 825 homes sold in October, 80 fewer than a year earlier.
“With so many properties on the market, if the buyer coming through doesn’t have a good immediate reaction to your home in the first minute, they’ll move on because they have plenty more homes to look at,” Gruber said.
As Iowa home sales flatten, this endeavor is seen as more important than ever before. Hatten said awareness about staging homes has been growing over the past couple of years in Greater Des Moines.
Five years ago, she spent most of her time educating real estate agents and home owners about the process. Now, she gets many inquiries about staging, which has grown to about 75 percent of her business.
Trying to get inside the mind of a potential mortgage loan applicant who’d be walking through the house, the stagers begin assessing a home before they even walk inside. Approaching the house from across the street, they take note of things such as the quality of the landscaping, outdoor clutter and the condition of the paint.
Inside, they go through the home using a “buyer’s eyes,” looking for problems such as loose caulk in the bathrooms, curling wallpaper, chipped paint, cluttered closets, an abundance of family photographs, etc.
The goal is to suggest improvements, remove clutter, make rooms appear larger with proper furniture placement and de-personalize the home so that potential buyers can picture themselves living there.
“You would be surprised at how some people don’t see beyond the things you have in your home. Sometimes people will remember that collection of beer steins you had in the family room, but not the great fireplace they saw there,” Hatten said.
People are quick to make judgments on a home based on how it’s decorated. When Gruber takes prospective buyers through houses, they often have a stronger reaction to colors and furnishings than overall size.
“I’m amazed when I go through homes with buyers. Sometimes I stop and ask them if it’s really the house they like or the furniture, because the house may be smaller than what they told me they were looking for.”
Homes on the market in Des Moines typically sell within 6-8 weeks, but now, according to market statistics from October, the average home is spending 11 weeks on the market. With those market conditions, and uncertain home mortgage costs, staging can make all the difference in snaring a buyer.