North Shore Views

Archive for March, 2010

The 5 Pitfalls of Overpricing Your House

These days I am finding that the “pricing talk” is one of my least favorite parts of the job. I feel for my clients when I have to tell them that their house is not worth what they thought it was or what it used to be. It’s especially hard when I have to tell them that it’s worth less than they paid. And I know how they feel because I am in the same position as they are. Luckily for me, I don’t need to sell my house.

Usually, after I deliver the bad news about where I think we should price the home, I hear one (or more) of the five “buts”:

1. “But the other agent  said it was worth x” (a higher number)

2. “But my neighbor sold his house for x” (a higher number)

3. “But my house is much nicer than the ones you’re comparing it to”

4. “But if I price it that low now, then the buyer will still negotiate it down and I’ll make even less money.”

5. “But why can’t we just start a little higher? We can always reduce it later.”

All of these are natural reactions under the circumstances. But these “buts” can lead to pricing decisions that will ultimately cost you money. Here’s how to avoid these five pricing pitfalls:

“But the other agent said it was worth x”.

I don’t want to say that there are agents who will inflate the price to get the listing, but it can happen. More likely the agent is throwing out a ballpark figure without having (yet) done an in depth competitive market analysis. Don’t ever hire an agent based on the price he or she gives you. Your choice of agent should be based on experience, track record, knowledge of your specific market and the marketing plan for your property. Above all it should be based on trust and confidence that the agent has your best interests at heart.

“But my neighbor sold his house for x”.

When? Three years ago? The fact is, unless his house is almost the same as yours and he sold it last week, it’s an irrelevant comparison. The market has changed and the hard reality is that your house is almost certainly worth less now. You need to do (or make sure your agent does) the research to determine the value of your house today. You should only be looking at comparable homes that have sold in the last three months. AND you should be looking carefully at the homes that are on the market today, as this is your competition.

“But my house is much nicer than the ones you’re comparing it to”.

We all become emotionally attached to our home. It’s our refuge and our haven.We’ve added our personal stamp. We’ve made lots of wonderful memories there. But when you go to sell your house, you have to emotionally disconnect. This is not your home anymore. It is a product for sale and you need to look at it objectively vs. its competition. Then price it accordingly.

“But if I price it that low now, the buyer will still negotiate it down and I’ll make even less money” .

This is one of the most common “buts” and I have to admit I’ve been guilty of it myself.  The problem with pricing a house higher than it should be because you “can always negotiate” is that it will attract less buyer interest because it doesn’t measure up to the other houses at that price point, and you won’t end up having anyone to negotiate with. It seems counter-intuitive, but pricing it lower may actually net you more money in the end, because it will attract a lot of interest and potentially multiple offers and a bidding war.

“But why can’t we just start a little higher? We can always reduce it later.”

This is the slipperiest slope of all if you are in a depreciating market, because you end up chasing the market down and are always higher than you should be. You will end up months later with an unsold house at a list price that is much lower than the price you could have sold for if you had only priced it right from the beginning.

The other thing to keep in mind is that a new listing gets the most buyer interest and activity in the first 2-4 weeks after it goes on the market. If it is priced too high, you are only helping one of your well-priced competitors make a sale. And your home will be invisible to those people who are its most likely buyers, because it is out of their price range. When it doesn’t sell after a few weeks it becomes “stale” and people begin to think there’s something wrong with it. So you reduce it, but you’re still behind the market, and so on.

Like it or not, in this market pricing will be the deciding factor in whether or not you sell your house.  If you really need to sell your house, then you need to price it so that it is the best house at the best price, and not a penny more. End of story.

Tags: Home prices, home selling tips, Pricing your home to sell

Asahel Gage House

I love the way this house looks against the blue sky (something we haven’t seen much around here for awhile). If you don’t recognize it, it’s on Elmwood Avenue in the Cage. I drive by it often and finally stopped to take a picture today.This beautiful example of Victorian Italianate architecture was built in 1873,  and is one of the oldest homes in Wilmette. It was built by Horace and Edwin Drury for Asahel Gage, son of John Gage, who was one of the early movers and shakers in Wilmette.

John Gage bought two tracts of land in the area that is now Wilmette: one was part of the Ouilmette Reservation (land given to Archange Ouilmette in 1829 as part of the Treaty of Prairie du Chien) and the other was in the area between Wilmette and Kenilworth. Later, after the Chicago fire (1871), many city residents sought refuge from the congestion and dangers of the the city. Seeking to take advantage of this movement out to less populous areas, Asahel Gage platted his father’s lands and began promoting sales of plots in “Gage’s Addition” to Wilmette, with this house featured prominently in his promotional materials

The Victorian Italianate style blended classical and romantic architectural elements and was popular in England and the U.S. during the Industrial Revolution. This house was typical of the style, with gabled roofs, wide eves supported by ornamental paired brackets and a four story entrance tower with steep mansard roof and cast-iron grillwork on top.

The house has been authentically restored and painted with several colors to accentuate the architectural details. It was granted local landmark status in 1989.

Tags: Asahel Gage house, Victorian Italianate style

What Home Sellers Can Learn from Lenny Briscoe

I’ll admit it. I love cop shows. I went through a big “Without a Trace” phase a few years back. And I still catch” The Closer” whenever I get a chance. But my all time favorite is the original “Law and Order“. We watch reruns while we cook dinner (Ed cooks; I chop).  Anyway, the other night as I chopped onions I was watching an episode I’ve probably seen ten times, and I realized there was something we Realtors could learn from Detective Lenny Briscoe and company.

Usually, about halfway through the show Lenny and his partner solve the murder and arrest the suspect. They read him his Miranda Rights and drag him off to the interrogation room for questioning, where they roll into their “good cop, bad cop” routine. Sometimes the perp is smart and lawyers up right away, but often he is (inexplicably) so eager to please the “good cop” that he ends up spilling his guts and incriminating himself.

That’s when it struck me that agents should read their sellers their Miranda Rights before they are allowed to talk to prospective buyers or their agents. Sellers want so badly for buyers to like their home, and are so eager to build rapport with them, that they divulge information they shouldn’t. We need to remind them that “Anything you say can and will be used against you”.

Here are some things that sellers will reveal that can undermine their negotiating position with a buyer:

• They’ve already bought another house and are closing on it next week.
• They’re being transferred to …(distant city).
• Their mortgage is all paid up.
• They’re facing foreclosure if they don’t get their house sold soon.
• They hate all the barking dogs or screaming kids in the neighborhood.
• They can’t go below x on the price (or they need to make x)
• They’re getting a divorce.

Any knowledge that can give buyers negotiating leverage should be kept under wraps. Savvy buyers will ask innocent sounding questions in an attempt to find out about your situation, why you are selling and how desperate you are. One of the agents in our office even had a buyer tour her listing, see (and read) a letter from a divorce attorney lying on the desk, and then try to use the knowledge of the sellers’ impending divorce against them in negotiations.

Obviously you need to be honest when answering questions about the condition of the house – it’s the law – but otherwise it’s a good idea to keep mum and refer questions to your agent. Better yet, be gone when buyers are touring your home. Things will work out better all around.

Tags: home selling tips, Law and Order, Miranda Rights, negotiating with buyers

St. Paddy’s Day Parade of Homes – How Broker Opens Help Sell a House

Broker opens are one of those tools in a Realtor’s marketing toolkit that we don’t think too much about. Unlike most of the standard tactics this one is not aimed at the buying public but at the other agents. Broker opens are a great way for agents to efficiently familiarize themselves with what’s new on the market. If done right, an agent can see 10 or 15  houses in the 3 hour window each week. You get the list. Map out your route. Spend 10 minutes in each house and move on to the next one.

For listing agents, broker opens are a good way to make sure their listing stays top of mind with other agents. It’s also a good way to showcase features of the home that are not easily explained in the listing remarks.  Agents use a number of bribes tactics to attract other agents to their open houses and get them to linger longer. The most popular bribe is food. Gourmet lunch is to Realtors as Dunkin Donuts is to cops.  Feed them and they will come. Another typical tactic is giving gift cards to everyone who shows up. Starbucks and Panera cards are pretty standard bribes around here.

My partner, Maureen, never does anything “standard”. She prides herself on her creativity. Her newspaper ads don’t look like other Realtor ads. They always have a humorous theme or clever hook that makes people notice and remember her. Her broker opens are not like other agents’ either. She always tries to make them special and fun, so that her listings stand out from the others. Her “events” are always memorable, and so are the houses that are the venues.

Maureen is also Irish (2nd generation) and she takes great pride in her Irishness. So it didn’t surprise me to hear her idea for this week’s broker open: a St. Paddy’s Day Parade of Homes. She put four of her listings on the “parade” and sent out a flier to all the North Shore agents letting them know how the tour would work: at each home there were tickets to a drawing for a pot of gold ($100 in gold dollar coins) at the last house. If you went to all four houses you would collect four tickets, meaning you would have four chances to win the pot of gold. At each house there was also a grab bag of silly St. Patrick’s Day trinkets to get everyone in the mood. And at the last house there was a big Irish feast for lunch: yummy corned beef sandwiches, Irish soda bread, cookies decorated with shamrocks, Green River…you get the idea. And, of course, we had the drawing for the pot of gold.

The result:  all four “parade” homes had a better than average turnout and everyone lingered at the last house eating, chatting and soaking up all the features of that lovely and unique home.  And, as the agents enjoyed Maureen’s hospitality, they were thinking about which of their clients this might be the perfect home for.

So, when you get ready to list your house for sale, ask your agent what creative marketing ideas they have that will set your home apart.

Happy St. Patrick’s Day!

May your pockets be heavy and your heart be light.
May good luck pursue you each morning and night.

Tags: broker open house, marketing your home, Maureen Spriggs

Adorable and Affordable: 903 Willow Road, Winnetka

My best buy for this week is 903 Willow Road in Winnetka. It’s an adorable vintage Dutch Colonial style home with 9 rooms, 3 bedrooms and 2.1 baths.

It’s priced at $599,000 and here’s why it’s such a great value:

• Lots of space in the house, the yard and the garage: It has good-sized rooms. Plus there’s a large screened in porch which expands the living area. There’s lots of living space and storage in the finished lower level. The yard is larger than comparably priced homes at 50′ x 187′ . And there’s a 4 car garage, part of which could be converted into an office or studio.

• It retains its vintage feel, but is updated where it counts (kitchen and bathrooms) and the updates are in keeping with the character of the house. The floors have been refinished, central air has been added and the windows were replaced within the last ten years.

• It is very conveniently located. You can walk to town and trains as well as to Crow Island School.

The downside?  If there is a downside to this house it is that it is on Willow Road, which does have a fair amount of traffic during morning and afternoon rush hours. But if you’re used to living in the city, this might not bother you.

See the virtual tour of this house here. If you’d like to see it in person, just let me know. I’d be happy to show it to you.

Tags: Homes for sale, Real estate, Winnetka

Confused By What You Read About the Housing Market?

It’s hard to know what to make of recent headlines about the housing market. Some days it seems like things are improving. Other days it’s all doom and gloom again. Here are some of the headlines about real estate I’ve read in the last few weeks:

“Housing Market Activity Picks Up”

“2010 Housing Market Off to a Chilly Start”

“Illinois Real Estate Sales Up 35% in 4th Quarter”

“New Wave of Foreclosures Threaten Market”

“Warren Buffett Sees Housing Market Bouncing Back by 2011″

“Chicago Local Housing Report Reveals Market Slow-Down”

“Negative Reports on Housing Continue”

I try to read everything I can about the real estate market and consider myself pretty well-informed on market developments. But even I find myself scratching my head sometimes. I guess I’m not the only one who wonders what to do with the mixed messages we are getting from the media. Lawrence Yun, Chief Economist for the National Association of Realtors, attempted to make some sense out of it all in his podcast on Thursday.

Here’s a summary of his comments on the state of the economy:

The U.S. economy grew 5.9% in 4th quarter 2009 and is projected to grow 3% during 2010.
But this growth was not accompanied by any new job creation, and unemployment remained near 10% in February.

The housing market recovery is still in a delicate state. Sales activity is up and the downward trend in prices appears to have stabilized. However, foreclosures remain high and government policies (e.g., HAMP) to stave off an acceleration of foreclosure activity have been ineffective, so foreclosures will remain high in the near future.

New home sales are down, because builders are just not building. The credit conditions for builders to get loans are very tight. Plus, builders cannot compete with the prices of all the distressed properties that are on the market.

Existing homes sales are doing better due to the tax credit, though sales dipped in January because of the severe weather in many parts of the country. Sales activity is expected to pick up in coming weeks as the April 30 tax credit deadline nears.

In the near term, the sustainability of the housing market recovery is going to depend on two things: consistent job creation and what happens with foreclosures in the coming months. And it’s anybody’s guess how that will play out because we’ve never been in exactly this situation before.

The general consensus among economists is that the housing market will move sideways in 2010 and then begin to grow again at a moderate and sustainable pace beginning in 2011.

Tags: North Shore real estate market predictions, North Shore real estate trends

Guide to Wilmette Preschools

Here ’s my list of the best preschools in Wilmette, based on my own experiences and research, as well as the recommendations of friends and clients.

Banner Preschool

3220 Big Tree Lane, Wilmette, IL 60091
(847) 251-3955
www.bannerpreschool.org

Banner Preschool believes that children learn best by being active participants in the learning process and the program is geared to stimulate intelligence through creative learning experiences. Curriculum includes music, art, reading readiness, cooking, science and social studies. There is an indoor gym and outdoor playground.

Banner is open to children two-five. Two year olds attend two days a week; three year olds attend three days;  four and five year olds attend five days. Read the rest of this entry »

Tags: Preschools, Wilmette

How Photos Can Prevent Your Home from Selling

By now most of us are aware that home buyers start their search online. According to the National Association of Realtors that number is currently 87% and growing. And 80% of people using the Internet rate photographs as the most important feature of their online search. In fact, these days, with large supply of homes available, most people see online photos as the easiest way to filter all the listings down to a manageable number. Here’s how it works:

If I like the pictures, the house stays on my list.

If I don’t like them, I click away, never to return.

Common sense, right?

So…it baffles me why home sellers and their agents (who should know better!) continue to commit the three deadly sins of real estate photography:

1. No photos when a listing goes onto the MLS

Here’s a common scenario: an agent gets a listing and immediately puts it into the MLS, even before taking photos of the property, figuring that the pictures can be added later. Or, the sellers pressure the agent to get their property into the system as soon as possible, thinking that the sooner it’s in the MLS, the sooner they’ll have an offer.

Here’s why that’s a mistake: most people beginning  the home-buying process set up online searches with automatic daily alerts for any new listings that hit the system. So, in the case of the aforementioned new listing, they get the alert but, since there’s no picture, they immediately eliminate it from consideration. Later, when the photos are added, they don’t get another alert, so those buyers never see that property again. Yes, agents will show the home to their clients if it meets their search criteria, but the sellers have inadvertently cut their buyer pool in half. The sad thing is, they don’t even realize it.

Give your home its best shot at finding the perfect buyer. Make sure you have your photos, floor plan and virtual tour ready before your listing goes in the MLS.

2. Not enough photos

In the old days, each real estate listing had one photo of the front of the house. But then again, in the old days people relied on their agent to show them all the homes that met their search criteria. Now, since home buyers are ” touring” homes online first, they want to see as many pictures as possible. At a minimum they expect to see the main rooms: kitchen, family room, living room, master bedroom. So, if they notice that some of these rooms are missing, guess what?  They assume that the seller is hiding something…that there must be something wrong with those rooms… and poof! The house is eliminated from consideration.

Make sure your house gets on the “must see” list of every target buyer by including great photos of all the key rooms of the house.  Try to include at least 9. You can also include some photos of your garden, neighborhood or nearby parks, beaches and other local features. Remember, you are not just selling a house, but a lifestyle, so use the photos that can accomplish this.

3. Bad photos

Bad photos come in two flavors: photos that are  bad because they’re dark or blurry and photos that are bad because the rooms are not staged or properly prepped for photography. Heck, some people don’t even bother to straighten the room they’re photographing. I’ve even seen one MLS photo where there’s a dog in the foreground licking himself.

I am always amazed at some of the pictures that people will include, thinking that these will help sell their home.

Do yourself a favor. Make sure your agent hires a professional photographer to shoot your listing photos. Believe me, it is worth every penny. A professional photographer has both the equipment and the expertise to show a home off to its best advantage.  A good agent will often include the photography as part of his or her marketing package.

The bottom line: think of the Internet as your first “showing”.  Just as you’d make your house shine for an open house or a showing, make sure your photos shine for that first virtual showing.

Tags: home selling tips, preparing your home to sell, real estate photography

Best Gas in Town

I know what you’re thinking. Gas is gas, right?

But this gas is different. Well, maybe not the gas, but the gas station. I’ve never been much of a loyalist when it comes to gas. It’s a convenience thing for me. I get gas wherever I happen to be when my car is on empty.

But a while back I came out of my house one cold morning and my battery was dead. Triple A gave me a jump but told me the battery was basically shot and I should get a new one ASAP. I was already running late that day so I went down the hill to Forrest’s Marathon Station (now owned by Duxler Complete Auto Care) at 1201 Green Bay Road in Wilmette to see if they could help me.

I had no sooner settled in with my newspaper and complimentary cup of coffee when they told me I was all set. The new battery was already installed. I don’t think it took five minutes. After I paid for the battery I realized I needed gas so I pulled up to the pump and started to get out to pump my gas when Ed came bounding up and said, “I’ll take care of that”. I thought he was just being nice because I had just had my car serviced there. But no. Turns out that they actually pump everyone’s gas.  I’ve always been a do-it-yourselfer when it comes to gas, but I have to say that, when it’s 20 degrees out and sleeting, it sure is nice to sit in my warm car and have someone else do it for me.

Today I needed gas again, so I headed down to my new favorite gas station. This time I brought my camera, snapped some pix and talked to the owner, Glenn Moak. Duxler has three other locations (Evanston, Northbrook and Skokie) but this one is the only one that has gas. Glenn says their goal is to put the service back into service stations. They pump the gas and, no, it’s not more expensive than self-serve places; in fact, it’s a bit cheaper. They have a full-service garage and tire replacement operation. They also have the cleanest bathrooms in town. They’ll even top off the windshield wiper fluid in your car and give you a lollipop when they’re all done. You can’t beat that.

ATTENTION LADIES: Thursdays are Ladies’ Day at all Duxler locations. For every oil change, Duxler will donate $2.00 to Susan G. Komen for the Cure, and you’ll also be entered in a drawing to win a day spa certificate.

So, if you’re sightseeing on the North Shore or touring homes for sale or just driving your kids’ carpools and need to make a pit stop, Duxler’s Marathon Gas is the place to go.

Tags: best gas station, Wilmette

It’s TV Tune Out Week!

Think your family can go for a week without TV or any other form of “screen entertainment”?

If you’re up for the challenge, North Shore businesses are here to support you. All week long sponsors of the “holiday” are providing tons of activities for those who want to experience life unplugged.

This year’s theme is “Power on Your Imagination” and the fun kicks off Sunday, March 7 with a performance by the Chinese Acrobats– at 3:30 p.m. in the Washburne School gym, 515 Hibbard Rd., Winnetka.  All week long you can take part in dozens of alternative activities – including acting classes, art projects, treasure hunts, story hours, behind-the-scenes tours,  sports and community service opportunities. Or, you can just enjoy time with your family at home, without the distraction of TVs, computers and video games.  Play board games, read together, bake cookies, or go on a family expedition.

TV Tune Out Week was started in 1995 by the Winnetka Alliance for Early Childhood and has now spread to surrounding communities. Over 5500 children participate in the program, whose goal is for families to evaluate the role TV plays in their lives, to explore other options and to become more educated about screen media.

Ideas for family fun and information about community activities are all  listed in The 2010 TV Tune Out Guide, which is available at participating schools or at various locations throughout the community.  For more information about TV Tune Out Week, visit www.winnetkaalliance.org.

Also see:

• Activities at The Book Stall
• Drop in at The Botanic Garden

Tags: Family fun on the North Shore, TV Tune Out Week, Winnetka