The Advantages of Working Together

Happy New Year! Hope everyone’s holiday was relaxing and joyous, because now it’s time to roll up our sleeves and dive back into work.

Here’s a case study from my most recent success story. Frank Rosmini of RE/MAX Millennium contacted me regarding one of his listings at 226 Dallas Road in Willow Grove (MLS # 5179183). All the way back on 11/14/06 another agent listed this property for $279,900. After 168 days and a price reduction to $264,900 the listing expired. After it expired Frank picked up the listing and put it up at $253,000. After 132 days he withdrew it and re-listed it for $249,900. While it was withdrawn the seller replaced his gravity warm air heating system with a forced air system including central air for $7,000. It was now November and the property was still not under agreement despite numerous showings. Frank knew that the property had flaws that could only be overcome by price, but his seller didn’t see it that way. He had lived in the house for 14 years and had grew accustom to these so called flaws. Frank contacted me in mid November and hired me to appraise the property. Without any counsel from Frank I inspected the property and wrote my report a day later. In that report I detailed the positives and negatives and how they related to the current Willow Grove market. I appraised this property for $230,000. Keep in mind it was listed for $249,900. Frank told me that my property flaw details mirrored the feedback he had been getting from buyer agents. Shortly after my appraisal the listing price was reduced to $239,900, despite Frank’s pleading for closer to my $230,000 appraised value. After a few weeks it was reduced to $229,000. Within two weeks it went under agreement for $230,000 and is scheduled to close January 21^st. Frank and his seller are just the latest example of people who I was able to help get their house sold.

To view a case study appraisal click the following link:

  Case Study Appraisal 

Here’s my take on our upcoming Spring market: there will be plenty of buyers after 12+ months of sitting on the sidelines. While the buyers will be there, make no mistake that there will still be much more inventory than available buyers. It is going to be more important than ever to get your listings priced right. I expect prices to drop about 10% from what the current comps demonstrate. I’m already seeing deals come across my desk with sale prices 10% less than asking. Those priced right listings are going to end up selling in a timely manner and end up taxing less of your time and money and keeping your clients happy.

In the upcoming months many of you are going to encounter some or all of the following. Unrealistic sellers who will want to base their asking price on outdated 2007 comps. Sellers who overlook their property’s negatives. And sellers who overvalue what they consider their property’s features. In these situations your best bet is to hire me to come out and provide an unbiased third party opinion. Based on the “time is money principle” $300 is a small price to pay to get a listing under agreement in a timely manner.

I’m looking forward to this year and wish all of you a healthy, happy, and prosperous new year!

Hello readers,

If you're reading this you are reading my first blog ever.  Wish me luck.  Anyway, I had the opportunity to speak to the agents at Remax Millenium on Wednesday, October 24th.  Despite the fact that I went on after they sat there for an hour they were extremely attentive and welcoming.  I thank them. 

As I stated at the meeting, going forward I would like to partner with each and every agent as their appraiser.  When you need counsel or advice, phone me.  I will always give you my time, maybe not always the answer you want, but always my time and consideration.  But my main message, and the one I feel gives you the best opportunity to enhance your sales and income, is the need for you to consider getting an appraisal done for those tough listings that you know are over priced.  Or the potential listing with the pie-in-the-sky seller who is pushing for an over price.  For whatever reason, most sellers put more stock in an appraiser's opinion of value than they do your's.  Makes no sense to me, I know you folks know your markets as well as me, but that doesn't change your seller's perception.  And their perception is their reality.  Rather than you get in a debate with them over price, let me, an unbiased third party, give them a dose of reality.  As I communicated, I will present myself in a well dressed professional manner and will take my time to to hear them.  I have found that sellers need to be heard.  My estimate of value will reflect their marketing needs: do they need a quick sale or is it preferrable to get a higher price despite an extended marketing period?  Click on the following link, it is from realestatejournal.com, a Wall Street Journal on-line publication, I think you'll find it informative.  Also, if you have a seller who you would like to approach with the appraisal concept, print it out, it's excellent ammunition. 

http://www.realestatejournal.com:80/buysell/tactics/20060728-hoak.html

The other point we discussed is getting an FHA appraisal done for one of your listings.  Obviously, you should only consider this if you have a listing in an FHA prevalent area.  Getting the FHA appraisal ahead of time serves numerous purposes.  Most importantly, you establish a value that sticks with that property for six months in the eyes of HUD.  In other words, if the listing ends up selling FHA that buyer's mortgage company must use that appraisal.  That is an FHA guideline and there is no way around it.  That's huge.  What if values come down in the months after that appraisal or there have been some low sales on the block since the appraisal?  So what, those conditions will not affect you or your seller.  Also, getting the FHA appraisal ahead of time alerts your seller to any required repairs.  As we talked about on Wednesday, HUD revised their appraisal guidelines approximately two years ago.  Since the revised guidelines repair items for FHA deals are way down.  So there may not be any required repairs anyway, but at least you will know for sure.  Keep in mind with the obliteration of sub-prime, alt-A, and no-doc, and the revision of conforming lending guidelines, FHA buyers are going to be more and more prevalent. 

In conclusion, I have been practicing what I'm preaching with different agents over the last six months and they have had sucess.  Their feedback is that my listing appraisals have saved them time and money as they were able to get the house priced right and subsequently sold fast.  We all know that as bad as this market is, when a house is priced right it typically sells in 30 days or less.  I hope you give me an opportunity to work with you, as I strongly believe in these methodologies.  You should note that we are credit card capable, which we have found people prefer.  Also, don't feel you need to give me appraisal work in order to lean on me for counsel or advice, I'm always happy to help other real estate professionals.  I would love to add any readers of this blog to my address book for future blog notices.  Please go the "contact us" link and give us your contact info including e-mail address and phone #'s.  I promise you we won't be bombarding you with junk.  My goal is to do a once month blog targeted towards agents.  I'm fairly certain next month's will be shorter. 

Jim Dougherty