Life Imitating Home Improvement TV?

Pumpkins at Robbs Farm in GlastonburyI don’t watch that much TV, but find when I do that I gravitate towards HGTV. Apparently I really enjoy real estate because even in my down time I focus on work related shows.

I like the creativity in the design programs but am more intrigued by the behaviors displayed on House Hunters or Property Virgins. I think it has to do with the fact that we help buyers in addition to sellers. I’m interested in seeing if buyers in other parts of the country are looking for similar things to those that we’re working with in the Hartford region.

The message I see coming across in the house hunting shows again and again is “We don’t want to have to do any work.” Buyers want nice curb appeal, updated kitchens and bathrooms, no wallpaper, minimal carpeting, an open floor plan, and plenty of light. Oh, and a finished basement, large backyard, quiet neighborhood, and big closets.

For some reason there is almost never any mention of mechanical systems. You know, the unsexy things like furnaces, hot water heaters, electrical systems, roofs, windows… The components of a house that cost large amounts of money to replace if they’re not in good repair, but keep your home running happily. *sigh*

The majority of buyers that we work with tend to be okay with having some work to do in a home. They understand that wallpaper is removable and can make it a weekend project or hire someone to help them. A kitchen might be from the 1990s, but it’s clean and functional, so it’s doable. They can upgrade it somewhere down the line to make it more in tune with what they’d like. If the neighborhood, room sizes and layout work those tend to be the deciding factors.

Some of our buyers do want “perfect” though. They don’t want the headache of dealing with contractors or have time to think about what they’d want in a kitchen remodel. They just want it done. I would actually say that this is the norm these days too. Just like we see on HGTV. Other agents indicate that their clients want homes that are done. Showing feedback on listings provides hints like “the kitchen needs to be remodeled” or “there is too much wallpaper” or “the floor plan wasn’t open enough.”

I wonder whether home improvement TV created the craze for perfect, or if the TV execs have modified their programming to reflect current sentiment? Eh. I feel a bit badly for sellers these days. What ever happened to the concept of sweat equity?

Real Estate Bargains: Getting the Best Buy Possible

Reflecting on the Real Estate MarketsYesterday we highlighted four common myths that sometimes lead buyers to believe they’re getting a better deal than they really are. Today we’re sharing some thoughts about finding true real estate bargains.

Let’s just get this first point out of the way early. If you’re looking for a ridiculous value – a complete steal – then a real estate agent probably isn’t going to find it for you. You need to start pounding the pavement to track down leads on your own. You need to find sellers who are (1) just starting to think about selling their home, and (2) completely out of touch with the approximate value of their home and the real estate market overall. Because once they talk to a real estate agent, or begin to look at what similar homes are selling for, the pricing is going to be far more rational and efficient. You are effectively competing with agents for listings.

Okay, so if we agree that your buyer’s agent is not going to find you the deal of a lifetime, how do you find a good real estate deal?

1. Look at what everyone else is ignoring.
Buyers are currently fixated on fully updated homes. This is a big change from the middle of the decade when sweat equity was all the rage. As a result, there are some interesting opportunities in homes that are in desirable locations but need some work. Sometimes these homes can be money pits, but other times the main issues are cosmetic. Differentiating between the two can lead to very good investments.

2. Be flexible in your requirements.
The wider the range of possibilities that you are considering, the more likely you are going to find a seller willing to compromise on price. Consider multiple towns. Consider different house styles. Consider different bedroom and bathroom configurations. The more options you are open to, the more likely an opportunity will come your way.

3. Be ready, willing, and able to react.
Every now and then we come across a property listed in the MLS that’s a good buy. We tell as many of our buyer clients about it as possible, but most of the time it’s not a good fit for their needs or the timing isn’t right.

For example, last year there was a home in a popular neighborhood in West Hartford that turned out to be a very good buy. According to the group of agents who visited it with us on broker’s tour, it was initially listed about 10% too high. It was also listed late in the spring market. The sellers quickly lowered the price to the point it was fair, but nothing happened. Buyers had checked out for the summer and there were no offers. After lowering the price to about 8% below was we all initially agreed was fair, they got an offer. The property ended up closing more than 12% below what we thought it was worth, and more than 20% below the initial asking price. It was not a distressed home, just one that got lost in the shuffle due to poor timing and pricing.

4. Focus on more than just the price.
Most of the homes in Greater Hartford are more than 25 years old, which means that their original mechanicals are approaching the end of their useful lives. Time for a quiz! You have the choice of buying two houses that are virtually identical. Choice A is a home with fresh, tasteful paint, but older mechanicals. Choice B is a home with hideous wallpaper and shag carpet everywhere, but new windows, roof, and furnace. Both have dated, but functional, kitchens and baths. Both have the same number of bedrooms, baths, and total rooms, and both have the same asking price. Which do you prefer?

Most buyers gravitate towards the tasteful and pretty. They overestimate the amount of time, effort, and money needed for cosmetic issues and underestimate the value of the mechanicals. Not only will newer mechanicals allow you to avoid the cost of replacing them, they will also operate more efficiently and save you money every month.

The average real estate buyer and seller is much more knowledgeable today than ever before. Information available via the internet and traditional media sources help them understand the sales process and pricing, which in turn makes the overall market more efficient. Finding an unbelievable bargain is a real challenge. Most buyers are focused on making sure that they get a good buy if a property needs work, and at least pay a fair price if the home is in move-in condition. The key is to know what else is on the market, so you know if the price is right.

29 Greystone Road, West Hartford

This classic Colonial located in West Hartford’s Webster Hill neighborhood is a great opportunity for a first time home buyer looking to put in some sweat equity. This home offers 1,323 square feet with 3 bedrooms, 1.5 baths, and an attached 1-car garage. The traditional layout provides nicely sized rooms, a living room with fireplace, hardwood floors, a classic black and white tile bath, and many newer windows. There is an oversized 3-season porch with Jalousie windows which is a great space spring through fall. The basement offers the potential for additional finished space. Finally, the level, private backyard is a nice retreat.

29 Greystone Road is offered at $235,000. If you’d like to see this home, please have your agent arrange a showing, call me at 860-655-2125 to schedule a visit, or stop by the open house on March 28 between 1:00pm-3:00pm. Both floor plan and photos are available.

29 Greystone Road, West Hartford

Preparing for a Fixer Upper

The New York Times had an excellent article this past Sunday regarding homeowners buying fixer uppers. Not necessarily because they want to, but because it’s what they can afford in order to enter the real estate market.

Unfortunately I think the HGTV culture leads lots of people to believe that home renovations are much easier than they really are, and that the renovations cost less than they really do. Remember, when you watch an HGTV do-it-yourself renovation show, they typically are only quoting the materials and are not taking into account the cost of the laborers doing the actual work. As far as you and I are concerned, the plumber or electrician isn’t really going to work for us for free.

So if you are in the market for a true fixer upper, here are some things to think about…

1. Is the house livable? Are you going to be able to stay there while you do the renovations or do you need to have other accomodations? I have a client that recently closed on a property and they live in about one-third of the house while they fix up the remaining two-thirds. It works fine for them, but I know it would not work well for others. You have to figure out your comfort level.

2. Do you have the cash available to get the necessary work done? Your agent and a general contractor should be able to give you rough estimates of what the renovations will cost. Can you do all of the work immediately or will it need to be staggered over several months or years?

3. If you have a partner, is your relationship a strong one? Major renovations that you personally undertake can be very stressful. They usually take more money and time than expected, and you may not have the same ideas as your partner. My husband and I once took on a porch renovation project that he and his dad thought they could do in a week. Three months of continuous evening and weekend work later, our neighbors were remarking they were surprised we were still married! Make sure your partnership can endure this type of stress before embarking.

Fixer uppers really aren’t for everyone, but if you’re willing and able to put in the work, you may be able to get the home of your dreams that would otherwise be out of reach. It might just take a few months or years to actually turn it into the home of your dreams.