Will realtor advise on needed improvements for home sale?

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mac_guy
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Will realtor advise on needed improvements for home sale?

Post by mac_guy »

My family has a dilemma regarding a home sale. A little over a year ago, my uncle had to enter an assisted living facility because of declining health. Because he doesn't have children and was never married, his sister (my mother) is left pretty much in charge of taking care of his home and preparing it for sale.

The home's value is probably right around $300K (I'm basing that on a recent neighboring home sale that was very similar.) However, my uncle's home is very old (early 1900's) and in need of upgrades. It is also extremely cluttered. My first thought was to get the entire home cleaned out. I was thinking about doing an estate sale where all the furniture and anything good was sold and all the rest donated or tossed. Then, I was hoping to get the whole home repainted on the interior. The plaster is not in good condition in a number of rooms and I figured the painters could fix and paint easier if the home is empty.

My mother looks at it differently. She says that we should have some furniture in the home for showing the house to buyers. She also doesn't think it would be worth while spending any money on improvements. She thinks the home in such need of improvement, that my uncle would never recoup the money we would spend. The kitchen is badly outdated and some flooring is old and worn. The home has no central A/C in an area with hot summers. The carpeting need to be replaced. The electrical system probably needs an upgrade and so on.

So, we really don't know what to do. We are wondering if maybe we should contact a real estate agent before deciding what to do. Will a real estate agent assess the home and give you an informed opinion about what you should do to prepare the home for sale? Will they give you an honest opinion about what would really help the home sell? Do they care whether it would be a good use of your money to, for example, spend $5K or $10K on a new kitchen (will we get a return on that money in a higher sale price?)

Anyway, we are looking for someone that cares about my uncle's interests to point us in the right direction (not sure if that is a realtor.) I also wanted to clarify why I am involved in this. My father is not in great health and his care takes up a lot of my mother's time. My uncle, I believe because of his poor health, is pretty much leaving these decisions up to my mother and myself. This is a tough situation for everyone involved.

In terms of finances, my uncle is going to fine for a while. His LTC policy will pay for much of care for the next few years. So, we do have some time to let the home sit on the market. The only problem is the cost of real estate taxes and home insurance which run him about $8K a year.
Last edited by mac_guy on Tue Aug 09, 2016 9:50 am, edited 1 time in total.
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goingup
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Re: Will realtor advise on needed improvements for home sale?

Post by goingup »

I'm sure BH realtor types will weigh in on the viability of just selling as a "fixer", which would be my first thought.

Wanted to suggest that you act with some urgency and not let a property sit vacant for too long. Things can go wrong, especially in winter. Insuring a vacant home becomes difficult, and now in August, you're already at the tail end of the best selling season. So, at the least, and regardless of making improvements, get the home emptied out.
Nearly A Moose
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Re: Will realtor advise on needed improvements for home sale?

Post by Nearly A Moose »

I'm not informed enough to tell you who would be the appropriate advisor in this situation, but to your mother's point about putting furniture in the home, there are professional home staging companies that will bring in furniture and artwork for showing. Depending on the market, it can definitely help.
Pardon typos, I'm probably using my fat thumbs on a tiny phone.
dandinsac
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Re: Will realtor advise on needed improvements for home sale?

Post by dandinsac »

My wife and I are going through a similar situation with her MIL. She is moving into an independent living apartment and selling the house. But it's outdated, has original (25+ year) carpets and kitchen. Everything works, but it's clearly not move in ready. My wife had three realtors come in and simply asked them what to do. Consensus in our case was just put it on the market as is.

I would also consider hiring a housing inspector to do a complete inspection. (The realtors can give you referrals.) With an old house, you don't want to start fixing it up, only to find later that you need to pay for major repairs to get the deal closed.
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CAsage
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Re: Will realtor advise on needed improvements for home sale?

Post by CAsage »

You can always start with the work you know has to be done, cleaning out the clutter. Keep a few pieces of basic furniture to 'stage' the house. When my Mom passed, I found it amazingly hard to sell furniture, it goes for very little and if it's in poor shape you may be better off tossing it to sell sooner. I seriously doubt you can get a new kitchen for $5k.... or anywhere close to that. One key decision maker might be what the comparable houses in the area are like, if they are all old then a little paint and carpet might move it, but bathrooms/kitchens are spendy. If the house is likely to be torn down and sold for the lot, then don't spend a dime on improvements, just clear it out! Definitely talk to more than one realtor in the area for options.
Another thought: There are 'flippers' in some areas that take on projects just like that. Having completely redone one bathroom and kitchen in my own house, I can assure you it takes a ton of time to just oversee, make decisions, check up on the contractor and arrange to get things redone or completed.... If you don't have the time to do this, don't start that path!
Last edited by CAsage on Tue Aug 09, 2016 10:09 am, edited 1 time in total.
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mac_guy
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Re: Will realtor advise on needed improvements for home sale?

Post by mac_guy »

dandinsac wrote: Everything works, but it's clearly not move in ready.
This is pretty much the same situation we are in. Everything works, but I just don't think that a home buyer today would be happy living in the home in the condition it is in. The major problem is that very little updating or upgrading was done in the last 30 years. The roof was replaced in the late 1990's and seems to be in good condition, but I can't point to many other recent improvements.

It looks like it may make sense to contact a few realtors first. We have names of realtors who have sold home of others in my uncle's neighborhood. We'll probably try them first.
mhalley
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Re: Will realtor advise on needed improvements for home sale?

Post by mhalley »

There are pluses and minuses to both. Lots of time the simple things (new paint, etc) give a good roi. Of course that takes time and money. Staging a home can increase the price, there are even companies that will do that for you as opposed to showing it empty. You can ask the realtor which they think would bring the most $$.
tacster
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Re: Will realtor advise on needed improvements for home sale?

Post by tacster »

I say keep the whole process as simple and painless as possible. Do an estate sale or auction to clear out the contents, then sell the house as-is as a fixer upper and be done with it. Realtors can help establish a fair value. Upgrades and repairs seldom return what they cost, and it sounds like you/your mother are already busy enough with your father's care, so I wouldn't go down that path. Good luck.
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Watty
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Re: Will realtor advise on needed improvements for home sale?

Post by Watty »

It really depends on your local real estate market so it would not hurt to talk to several real estate agents.

The last time I sold a house I interviewed about six real estate agents by talking to them on the phone for about 15 minutes . I then let three of them present their written market analysis and tell me their marketing plan before I selected and agent. I was upfront with them about my selection process and they were fine with it. During the process it I learned a lot about the local market and it was also obvious that some agents would be a lot better at handling some significant issues that my house had.

A good general rule is to fix what is actually broken, like a furnace or hot water heater, but not what is just cosmetic stuff unless there is a compelling reason to.

One thing to keep in mind is that the longer you take to sell the house the more chance that your uncle will die before the sale closes. You may have all the appropriate paperwork to be able to sell it now but once he dies that usually ends and the house would need to go through the estate which could take a long time to settle before the house can be sold.

Talk with a lawyer about what powers of attorney you need in your state to sell the house since some states have special requirements for a real estate power of attorney. Your uncle may be able to sign the needed paperwork now but he might not be able to do that in a few months.
mac_guy wrote:She says that we should have some furniture in the home for showing the house to buyers.
From your description of the house I would suspect that your uncles furniture would not be very appealing.

With an old house like that some buyers will also be concerned that the furniture could be covering up something.
mac_guy wrote:The kitchen is badly outdated and some flooring is old and worn. The home has no central A/C in an area with hot summers. The carpeting need to be replaced. The electrical system probably needs an upgrade and so on.
There are are problems with trying to do major renovations.

1) You will be tempted to do it cheaply, and buyers will not be fooled.

2) Once you start on a project you may will find additional problems that will cause the price of the renovation to go up a lot and for it to take a lot longer.

3) Your taste may be different than the buyers when it comes to colors, dark wood, light wood, or painted cabinets.

4) By putting more money into the house you will need to sell it at a higher price.

My first house had a kitchen with avocado green counter tops and appliances long after that was out of fashion. The house was at the top of my price range so if they had remodeled the kitchen I could not have afforded it. The kitchen was perfectly functional but just dated so I lived with it and eventually remodeled it doing most of the work myself.
I found it amazingly hard to sell furniture, it goes for very little and if it's in poor shape you may be better off tossing it to sell sooner.
Most of the younger generations have little interest in antiques or big furniture so there is a glut of it on the market with people trying to clear out houses like your uncles.

Since it is an older house you might select a couple of accent type pieces of furniture to leave in the house for the next buyer. When my son bought his first house a couple of years ago the seller did that and that seemed to go over well with his generation.
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Watty
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Re: Will realtor advise on needed improvements for home sale?

Post by Watty »

mac_guy wrote:Then, I was hoping to get the whole home repainted on the interior. The plaster is not in good condition in a number of rooms and I figured the painters could fix and paint easier if the home is empty.
One more thing. When I have bought houses I am always suspicious of fresh paint. Some sellers will just try to paint over a problem.

When I look at something like a ceiling that looks like it hasn't been painted in 20 years I can be pretty sure that there have not been any any water leaks in the last 20 years.
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mac_guy
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Re: Will realtor advise on needed improvements for home sale?

Post by mac_guy »

Watty wrote: Most of the younger generations have little interest in antiques or big furniture so there is a glut of it on the market with people trying to clear out houses like your uncles.
It's funny. You basically just described his dining room set. Its a Chippendale reproduction set made in the 1940s. It was probably considered quality when he bought it. But is so big and bulky and fills the dining room up in an almost uncomfortable manner.

As someone much younger, I would never consider that style.
Northern Flicker
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Re: Will realtor advise on needed improvements for home sale?

Post by Northern Flicker »

The answer to the OP's question is: yes, a good real estate agent will help you sort through the options to help you decide on what to do (if anything) to get the house ready for market. Find an agent who regularly does business in the neighborhood in question for the most accurate and detailed advice.
NotWhoYouThink
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Re: Will realtor advise on needed improvements for home sale?

Post by NotWhoYouThink »

Check out several estate sale companies in your area as you check out the real estate agents. It's a good idea to have a "For Sale" or "Coming Soon" sign out in front of the house during the estate sale - some buyers might walk in and check it out or talk to friends about it. At least in our area, they work that way.

The estate sale companies here will go through everything (they all told us not to throw out anything, but we got rid of the catalogs and National Geographics anyway), throw out the trash, price and stage the rest, advertise and hold the sale, empty out what doesn't sell, all for 30-35% of the proceeds. Worth their weight in gold. You'll want to do some preliminary screening to make sure he doesn't have a bag of gold coins lying around somewhere, but otherwise it's probably worth it to let the experts deal with it.

Good luck. And clean out your garage so your nieces and nephews don't have to do all of this for you.
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mac_guy
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Re: Will realtor advise on needed improvements for home sale?

Post by mac_guy »

jalbert wrote:The answer to the OP's question is: yes, a good real estate agent will help you sort through the options to help you decide on what to do (if anything) to get the house ready for market. Find an agent who regularly does business in the neighborhood in question for the most accurate and detailed advice.
Thank you. That does answer an important question for me. Do you also know if realtors are able to refer contractors to do any needed work? I would imagine a realtor would have a good idea about which contractors do quality work. Not sure if it would violate any realtor code of ethics though.
Rupert
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Re: Will realtor advise on needed improvements for home sale?

Post by Rupert »

Why make things harder for yourself and your mother than they need to be? Just empty it (there are estate sale companies that will do that for you), list it for sale as a fixer upper, and price it accordingly.
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Re: Will realtor advise on needed improvements for home sale?

Post by Jack FFR1846 »

It's well worth having an inspector and/or contractor in to give you a better idea of what's needed in the house. My wife and I will be faced with a similar situation with an aunt's house, but we know enough to know not to do anything besides yard sale, craigslist and dumpster. In our case we're looking at:
1890's 3 decker house in the part of the city where the neighborhood has gone way downhill.
Lead paint everywhere.
Knob and tube wiring.
Asbestos insulation on heating system and pipes.
Not sure if water pipes are steel or lead.

Well over $100k to make the house inhabitable. I estimate it would then be worth $80k....so as I relay to my wife.....the house is bulldozer ready and whatever the lot is worth is likely the upper range of what the property is worth. With the cost to tear down, even more likely worth zero.

You want to know this going into it.
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Lynette
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Re: Will realtor advise on needed improvements for home sale?

Post by Lynette »

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whomever
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Re: Will realtor advise on needed improvements for home sale?

Post by whomever »

I'm no expert, but what we did was to have a few prospective realtors come over a couple of months before we planned to list. We'd ask the usual questions about experience, their fees, their marketing plans, and for examples of houses they were currently selling (so we could look at the online listings; you want to see how good their marketing verbiage and especially photography is).

They didn't all agree. One recommended extensive remodeling that, I think, would have been very difficult to recover the cost of. Some said do nothing. The one we picked recommended new carpets and painting a couple of rooms. I asked about staging, and she advised against extensive staging; she just wanted the house empty and scrupulously clean. When we were ready to list, she showed up with a trunk full of bric-a-brac and did some minor staging - hanging some pretty, brand new towels and putting some fancy soap in the bathrooms, a bowl of fake fruit and some bottles (classy looking olive oil etc) in the kitchen and so on. I remember she had several classy bottles of hand soap in different colors (the soap, that is, clear glass bottles) and tried a few to get the color she liked. That kind of stuff made a surprising difference for negligible cost.

I think it's hard to generalize. For example, she said she usually only brought in furniture etc for more expensive houses, and her recommendations also took into account the current local market conditions.

In any event, you want to interview agents anyway, and asking both for their fix-up/staging advice, and the 'why' behind their specific advice will help find a suitable realtor, and you can then choose among their recommendations.
Northern Flicker
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Re: Will realtor advise on needed improvements for home sale?

Post by Northern Flicker »

mac_guy wrote:
jalbert wrote:The answer to the OP's question is: yes, a good real estate agent will help you sort through the options to help you decide on what to do (if anything) to get the house ready for market. Find an agent who regularly does business in the neighborhood in question for the most accurate and detailed advice.
Thank you. That does answer an important question for me. Do you also know if realtors are able to refer contractors to do any needed work? I would imagine a realtor would have a good idea about which contractors do quality work. Not sure if it would violate any realtor code of ethics though.
A realtor should be able to provide you with referrals to contractors with a history of successful projects known to the realtor.
Lynette
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Re: Will realtor advise on needed improvements for home sale?

Post by Lynette »

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adamthesmythe
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Re: Will realtor advise on needed improvements for home sale?

Post by adamthesmythe »

The right answer is somewhere between "only declutter" or "total house flip."

Talk to realtors, ask then not only what but why, and then go with your gut.

> These older houses are a minefield of potential problems

You know that, prospective buyers know that. A house priced at the right place will sell, old, new, cluttered, staged. The issue is finding the best compromise between work, money, and selling price.
grandmacassie
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Re: Will realtor advise on needed improvements for home sale?

Post by grandmacassie »

Can't give advice, but will share experience
MIL owned house since 1958. Although reasonably well maintained, it was very outdated, no a/c, old appliances, "50's floor plan, you get the picture. Here's how we sold it when she moved to skilled nursing. First we (the kids and grandkids) took items that were meaningful. Then:
Step 1. We got a real estate appraisal from a certified (whatever that means) appraiser -- not a RE agent.
Step 2. We hired an auctioneer with a comprehensive auction business including on-line, arts and antiquities, guns and militaria, etc. subset auction ability. He surveyed the house and took specialty items for on-line specialty auctions. He then helped us toss and clean out unsellable items.
Step 3. An onsite auction date was set for real estate and remaining household items and furniture. This was advertised 6 weeks ahead of date. Several open houses were scheduled and potential buyers could bring in inspectors/contractors by appointment.
Step 4. Auction Day. Furniture and household items were sold for next to nothing. House was sold (many procedures for pre-qualifying, $$ down earnest money, property sold "as is", etc. All handled by auctioneer.) for $80k more than appraisal. Settlement 45 days, no contingencies permitted.
This worked well for us and has provided plenty of $$ for her future care. Non-real estate items carried a 20% auctioneers fee. The real estate auction fee was half of what the standard Realtor fee is in our area, although advertising and promotion was not included. We first spoke with the auction house in mid August and the settlement proceeds for the real estate were in the bank by mid-December.
Carefreeap
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Re: Will realtor advise on needed improvements for home sale?

Post by Carefreeap »

Keep in mind that not everybody wants a "modern" house.

Emptying it, cleaning it up (small repairs, paint) will go a long way.

I hate paying for someone else's "remuddling" and prefer a house that has "good bones" in a nice location.
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Boglegrappler
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Re: Will realtor advise on needed improvements for home sale?

Post by Boglegrappler »

A lot depends on the local real estate environment.

You must be in a decently upscale area for taxes to be 8000, and for a home built in the early 1900's to be worth 300k.

I'd vote for getting the house empty, and also for doing your painting and plastering stuff. You might need to do floors too. Also, apparently young people don't want carpet, so I'd hold off on buying new carpet. You might want to just rip out what you have, assuming there are hardwood floors.

The kitchen is another matter. It depends somewhat on the likely buyers, but your figure of 5-10k to fix up the kitchen seems low to me by orders of magnitude.

Interview some realtors and see what they think. My experience and that of others I know is that today's buyers aren't that interested in creating "sweat equity" by fixing things themselves. Not even painting. And to the degree that they would, its easier for them to finance if its already done and built into their purchase price.

Markets seem to be different all over the country. I know some areas are "hot".......but in our upscale area realtors are cautioning sellers to be prepared for a long wait before their house sells. (I think this is because our prices are slowly declining from very high levels, and its easier to tell clients to be prepared to wait than to risk their ire by telling them to drop their price.)


Finally, its possible to be in a situation where all of your value is in the land, and your "improvements" or structure, are essentially worthless. We see that a lot where I am, and I'm not talking about houses that are falling down, either. Just ones that are over 40 years old, and on lots that are now worth a lot to a builder. If that is the case, then its pointless to do anything. Your buyer would be a builder who would demolish the old house anyway.
Good luck.
Bacchus01
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Re: Will realtor advise on needed improvements for home sale?

Post by Bacchus01 »

dandinsac wrote:
I would also consider hiring a housing inspector to do a complete inspection. (The realtors can give you referrals.) With an old house, you don't want to start fixing it up, only to find later that you need to pay for major repairs to get the deal closed.
I would strongly advise against this. Whatever you find during the inspection you are now completely liable to disclose and/or rectify.
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mac_guy
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Re: Will realtor advise on needed improvements for home sale?

Post by mac_guy »

Boglegrappler wrote:A lot depends on the local real estate environment.

You must be in a decently upscale area for taxes to be 8000, and for a home built in the early 1900's to be worth 300k.
The school district is very highly rated and most of the real estate are school taxes. However, I was lumping all real estate taxes and homeowners insurance policy in there. Taxes are about $5000. Homeowners insurance is $3000/year. When my uncle moved out, I had to get a policy for a vacant home. I could only find one company that offered vacant home policies and his premium went from $1000 to $3000.
Boglegrappler wrote:A lot depends on the local real estate environment.
The kitchen is another matter. It depends somewhat on the likely buyers, but your figure of 5-10k to fix up the kitchen seems low to me by orders of magnitude.
I mentioned that price without even knowing anything about kitchen costs. I probably should have done some research. The only reason why I thought it might not cost that much is that the kitchen is so tiny. There isn't even a dishwasher.
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steadyeddy
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Re: Will realtor advise on needed improvements for home sale?

Post by steadyeddy »

You have to ask yourself who is going to buy the house.

A large house in a nice neighborhood offers better ROI on improvements than a small home in a bad neighborhood. Handy people shopping in that nice neighborhood likely also have more cash to fix a home up themselves if you sell it as a blank canvas at a lower price.

A small home in a less desirable neighborhood is only going to attract buyers with more limited means, so you won't make money if you fix it up too nicely and price them out. But you also can't sell an uninhabitable place to them because they won't have the cash to fix it up themselves. In that situation you're getting lowball cash offers from flippers and slumlords.

Figure out who you're trying to sell it to, do the appropriate renovations (if any), and then price it at what the market you've chosen will bear.
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steadyeddy
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Re: Will realtor advise on needed improvements for home sale?

Post by steadyeddy »

Boglegrappler wrote:My experience and that of others I know is that today's buyers aren't that interested in creating "sweat equity" by fixing things themselves. Not even painting. And to the degree that they would, its easier for them to finance if its already done and built into their purchase price.
Definitely agree. In my area, any "turn key" homes under $300k are snapped up in days while homes priced at $150k with $75k repairs needed are languishing on the market. Buyers simply don't have the time, interest, or available capital to rehab houses, but they can afford a 30 year mortgage payment when a flipper fronts the money and does the work. YMMV
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Sandi_k
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Re: Will realtor advise on needed improvements for home sale?

Post by Sandi_k »

It might help if we knew where the house was located - a LCOL vs HCOL area could have widely disparate responses.

To answer your specific questions: yes, a realtor can give you an idea of the worth, and they can also recommend useful vendors who handle repairs, etc.

But keep in mind that most realtors want it sold, and fast - so they will possibly overbid its value (to get your signed contract for sale) and then encourage you after the fact to slash the price since you're going into the fall and winter sales slump time. It's what happened to my MIL, when she went to sell her mother's house.

IIWY, I would clear out the house, and leave a few smaller pieces of furniture that won't sell: bed and mattress with bedding; bookcases or desk for an office, small dining room table or chairs. And not much else.

I would paint if the room is obviously dingy - especially the kitchen, bath, living room, and master bed/bath. Remove clutter, long drapes that hide the natural light, excess furniture, pictures, and empty the closets and basement.

Prune the yard relentlessly, plant some nice rose bushes or camellias, and then sell it as-is. Paint and cleaning is cheap. Lowe's can sell cut-to-order blinds on the spot, which can help update a room over claustrophobic curtains.
CWhea1775
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Re: Will realtor advise on needed improvements for home sale?

Post by CWhea1775 »

Here is an idea that some friends used; Most home sales in our area occur with an inspection, followed by a negotiation about what gets fixed and who pays. Our friends paid for their own inspection before putting the house on the market. They then fixed up the major items that the inspection revealed. When folks made an offer on the house they presented them with the inspection report and listed the repairs that had been made. I would think that cosmetic upgrades would be best left to the buyers, but safety and maintenance issues taken care of first might help you sell.
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hand
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Re: Will realtor advise on needed improvements for home sale?

Post by hand »

jalbert wrote:The answer to the OP's question is: yes, a good real estate agent will help you sort through the options to help you decide on what to do (if anything) to get the house ready for market. Find an agent who regularly does business in the neighborhood in question for the most accurate and detailed advice.
My take is slightly different... The above is what a good agent *should* do.

In reality, as in many commission driven situations, a realtor is likely to advise you on changes you can make that will make their job easier / commission higher which is largely (but not exactly) aligned with your interests in a maximally profitable and timely sale.

As always, you retain the responsibility for evaluating the proposal based on your own best interests.

This is a situation where I could imagine getting real value by evaluating several agents - as part of their listing presentation, ask that they provide specific advice regarding fix up options.
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mac_guy
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Re: Will realtor advise on needed improvements for home sale?

Post by mac_guy »

Sandi_k wrote:It might help if we knew where the house was located - a LCOL vs HCOL area could have widely disparate responses.
I would say it's a somewhat HCOL area. It's in a fairly densely populated suburbs of a large NE city. The school district is rated in the top-5 of the state. There are many very expensive homes on the school district. My uncle's home, however, is on street among the smallest and lowest cost homes in the school district.

In terms of specs, the house is 1600 sq feet. 1 full bath, 1 half bath. 5 BRs. Fully usable third floor.
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mac_guy
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Re: Will realtor advise on needed improvements for home sale?

Post by mac_guy »

steadyeddy wrote:You have to ask yourself who is going to buy the house.

A large house in a nice neighborhood offers better ROI on improvements than a small home in a bad neighborhood. Handy people shopping in that nice neighborhood likely also have more cash to fix a home up themselves if you sell it as a blank canvas at a lower price.

A small home in a less desirable neighborhood is only going to attract buyers with more limited means, so you won't make money if you fix it up too nicely and price them out. But you also can't sell an uninhabitable place to them because they won't have the cash to fix it up themselves. In that situation you're getting lowball cash offers from flippers and slumlords.

Figure out who you're trying to sell it to, do the appropriate renovations (if any), and then price it at what the market you've chosen will bear.
This is a relatively small home in a neighborhood that I think it desirable because of a very high quality public school district. It's a relatively HCOL area, but the neighborhood his house is in, is among the most affordable.
harmony
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Re: Will realtor advise on needed improvements for home sale?

Post by harmony »

I might have missed this upthread somewhere, but have you considered not selling the house until your uncle passes away? This would give stepped-up basis to the heirs. You would have to research the purchase history to get the value of the stepped-up basis to compare to the annual expenses of $8K / per year that you mentioned. However, if he outlives his LTC insurance (sounds like that could be a possibility?), it would be good to have the house ready to go on the market. Most of the income from the house sale, in a year when he has huge unreimbursed medical expenses like LTC, could be used as a medical expense tax write-off on Schedule A.
stan1
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Re: Will realtor advise on needed improvements for home sale?

Post by stan1 »

Some thoughts based on my mom's house (built in 1969). I cleaned it out and got it ready to list over a 3 month period.

1) Empty the house and make it spotlessly clean. You can save some furniture for staging if it is clean and not too dated but it is better clean and empty than dirty. Estate sale companies might not be interested if most of your uncle's treasures are "junk". We brought in a large dumpster, had a yard sale, and donated the rest to charity after culling through the house. I gave away many items for free at the garage sale (EVERYTHING in the free area was taken).

2) Interview multiple realtors. Ask a lot of questions and gather feedback. Select a realtor who closes sales on a lot of houses in the neighborhood (hundreds over her career). Avoid realtors who primarily give you interior design advice. Go with someone who is successful and pragmatic. Our realtor was one of the most successful in town over a 30+ years career and also had a contractor's license. Ask the realtors how they will handle repairs. Most realtors will not offer to work as a general contractor but many will make referrals to contractors, roofers, and handymen that they have worked with in the past. The contractors appreciate the business a successful realtor sends their way so our experience was that they were responsive, fair, and quick.

3) Is it possible the house would be a tear down or gut remodel? If so proceed differently. I'm guessing this is not the case at the $300K price point but this is hopefully what the realtor consensus will help you understand.

4) Repair major items that will show up on an inspection (roof, HVAC, water damage, windows, drainage, foundation, appliances). My recommendation is to do this first because some buyers will be scared away if these problems start coming up during the closing process.

5) Paint outside and inside. Government lenders will not finance a house with chipping exterior paint. If there is old, dirty carpet that can't be cleaned replace it. The idea is to make the house clean and livable so buyers don't feel rushed into an immediate remodel. Some people will want turnkey. Clean and livable are a compromise that will be OK with many buyers.

For us this approach yielded a good price and a quick sale. Our realtor discouraged us from remodeling the 45 year old kitchen and bath because we wouldn't get the money back. By doing the above work we were able to avoid low ball offers. If you sell "as is" you risk lowering the price once before listing and then again to get it sold. In my state there is no such thing as an "as is" sale because the buyer is legally entitled to a contingent inspection. We put in $25K which I think yielded over 100% and got the house sold into escrow at about day 45 on the market in a low volume small town.

Hope this helps. In our case my mom needed as much money as possible to pay for her future care. She cannot live by herself but is OK in a supervised independent living situation which she could be in for 10-20 years.
Pharmacist
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Re: Will realtor advise on needed improvements for home sale?

Post by Pharmacist »

You may or may not make more money by remodeling, but in the worst case scenario the house will at least sell a lot faster.

I'd get the house appraised as-is and see what the similar sized move in ready houses are selling for in your area. This should give you an idea on how much you can gain by doing the upgrades. At the very minimum I'd paint it and have new carpet installed. Maybe refinish any wood floors. These are the easiest things to do and yeild the greatest value. If you are talking about gutting kitchens/bathrooms that is where you need to know the market because you may not get your money back.
Pdxnative
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Re: Will realtor advise on needed improvements for home sale?

Post by Pdxnative »

A good realtor should help with advice; finding a good realtor is very hard...

I've seen houses like this get listed with a carpet, paint, appliance allowance (basically a rebate to the buyer). This could save you the trouble of managing all these things yourself while also making this an attainable purchase for a family who wouldn't be able to afford out of pocket upgrades. Of course, it's hard to beat the first impression of freshly painted walls and new flooring.

Definitely empty it out and clean out the yard. If you want to stage it, buy or rent newer furniture for that purpose.
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whodidntante
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Re: Will realtor advise on needed improvements for home sale?

Post by whodidntante »

Anyone can give an opinion. You hope that the realtor will give good advice, but unfortunately that is not always the case. I stopped listening to the advice and did what I thought was necessary and my house was sold in a week for a price I was happy with. It had been on the market for months.
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jfn111
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Re: Will realtor advise on needed improvements for home sale?

Post by jfn111 »

I'll skip over all the agent bashing and offer this-
When doing price opinions there is a low, medium and high. (Low being distressed properties that are often bank owned and high being the pristine remodeled house with all the latest bells and whistles).
A good agent can give you an opinion on where this house falls in that range.
It's often not worth it to chase the "high" because it usually costs more than you'll ever get back.
The agent should be able to give you some advice on some low cost enhancers that will help the property sell faster, and be more appealing to a broader range of buyers.
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