LA Digs - Northeast LA Real Estate Blog

We hear this from sellers all the time. We discuss reducing the price after we have marketed the property for several weeks and have received no offers. Sellers don’t want to reduce their price because they are hoping that they will get lucky and some desperate buyer will pay their price. We talk about how buyers don’t want to make an insulting offer and anger the seller. The seller claims they would not be offended (food for another blog). So they say, if a buyer likes the house, why don’t they make an offer?

I have discovered the truth about this: buyers don’t make offers on properties they think are overpriced because they are conditioned not to! A prospective buyer called me about a listing that has been on themarket about 3 weeks. She wanted to know if we were planning to reduce the price soon. I chatted with her about the house, which she had seen at an open house and she loved it. But she felt it was priced too high. However, she said she knew that often a house would come on too high and they would reduce it if no offers came in.

What kind of offer would she want to make? It turns out that she thinks it’s about $100,000 too high. I told her that the seller was not in a position to sell it for that much less. I also told her she might want to look at homes priced under $450,000 if that was her price range.

After we hung up, I thought of a listing I have that is coming on the market next month. I called her back and told her about it--a cute house in the hills of Highland Park near Eagle Rock that will come on at $399,000--a short sale that has been tenant occupied for a year. She said she would be interested if it was just as nicely done as the one she had seen.

Who knows if this buyer is at all realistic about values, but she does have an educated opinion. She may be hoping that $400,000 will buy her a perfectly done house in a nice neighborhood in Eagle Rock--a not very likely possibility. When my new listing is ready for the market, you can be sure that I will call her to tell her about it and find out just how serious she is.

But the lesson here is for sellers: buyers don’t want to begin a negotiation on a negative note by making a low offer. They have seen a lot of properties have price reductions after being on the market a fairly short time. When they see a price drop, they know that a seller is willing to negotiate and are more likely to make an offer at that point. So if you have been trying a higher price and it hasn’t brought any offers, consider making a price reduction to stimulate activity, because often that is just what a buyer is waiting for.

Now that we can almost smell those relentless reindeer about to land on the roof thanks to ambitious retailers, the question of "Should I try to sell my house during the holidays?" comes up.

You may have heard all the pat answers:

1. Houses look so pretty during the holidays, why not?
2. You won't see as many buyers, but the ones who are out there looking are really serious.
3. Some buyers have to close escrow by the end of the year for tax reasons.
4. Many buyers are on vacation during the holidays and have more time to look at homes.
5. Buyers are more emotional during the holidays, so they are more likely to pay more for a home.
6. There are fewer homes on the market, so less competition for your home.
7. You can close escrow on your home before the spring buying season, and so be in a better position to make a non-contingent offer on your next home.

All pretty good reasons, but the real question that sellers ask today is not really about "should I sell during the holidays" but  "Do you think my home might be worth more in the spring?"

That is the 64-dollar question, my friends. I was just asked it today. And prospective sellers don't want to take "I don't know" for an answer! "Come on, someone who has all the experience you do must have at least a feeling for what the market will do next!"

Yes I do. My feeling is that the market is volatile and will continue to be volatile and it could go up or it could go down based on many economic indicators that we don't have information on yet. Like, will the unemployment rate be down in the spring? Or, will the economy be better? Or will interest rates go up? Spring is several months away. Who do you know who is confident that they know what will happen then?

What if I said to you, "Wait until Spring, your house will be worth more," and then come next April the bottom has fallen out of the economy and your best chance of selling at a profit was lost? How would you feel? Do you really trust my expertise that much? If I told you that the best price you are going to get for your house for the next 5 years is right now, would you believe me? Let's all put it out for a vote: who thinks prices are going to go up in the Spring? Down? Oh, it's a 50-50 split. Now what? you really have to make your own decision about when to sell. It's kind of like deciding when to have a baby. What might be great timing for you is wrong for someone else, so how do you decide?

One of the hardest things about putting your home on the market is getting it ready for everyone to see. You have to pack up all your stuff, you have to clean, fix, paint, freshen, landscape...lots of stuff. The best time to put it on the market is when you have that stuff done. So when will that be? Does it help you to have a deadline? Good. Then get it ready now and go on the market when you are done. I don't care whether that is next week or next year. I will be here, ready to do my part when the time comes. My team is here to provide all the support possible to help you through this process.

One of the panels we attended at the Inman Connect Real Estate Conference in New York a couple weeks ago featured Vern Yip from HGTV's "Deserving Design." He was fantastic to listen to and had a lot of great tips for showcasing a home to really appeal to its buying audience. Here is his presentation (you can skip ahead to 11:45 to get to the tips): Design Tips to Sell Homes. You can read the transcript of the presentation here.

And here are his "Best Ideas for Staging Your Home":

1. Present an optimal space plan

Optimize every room with a space plan that keeps rooms open and easy to negotiate, while showcasing how to utilize unusual spaces. Moving furniture around doesn't cost anything! This is so critical because not everyone who enters a property has the ability to envision how that property can be fully utilized. Sometimes people just aren't visual people, that's not what they do. Presenting an optimal space plan is the first and most critical portion of really showcasing what makes a property special.

A couple of examples:

• Take an awkward nook in a bedroom or kitchen and turn it into a home office.


• Use a dining room table as a place for meals and a desk for projects. In Urban Oasis New York, Vern used a table that seats six, but also served as a desk complete with pedestals for storage and electronics. He points out that it also serves as a prep surface for the open layout kitchen - all to show viewers how to optimize square footage in a small apartment.


• Hide a laundry unit behind doors in the kitchen, or a hall closet, or a bathroom closet.

It's really about showing people how a space plan can improve their space and what they're actually getting.

2. Stick to a monochromatic scheme

A monochromatic room with minimal contrast looks bigger because the number of visual breaks is minimized. When you diminish contrast you actually expand the visual plane. Neutral colors in tans, warm grays, taupes, and shades of warm white have the most flexibility for adapting rooms to anyone's style and have the broadest appeal. A fresh coat of paint is the best investment when staging a property for sale.

An example:

In one unit from the show Selling New York there were some serious architectural elements in the living area. Everything in this unit is painted a warm white color, even some of the furniture is white. So the structural element blends in with the environment. You can accent it if you want, but painting it the same color as the wall diminishes it so if somebody doesn't necessarily like it, it fades into the background.

3. Incorporate organic elements

Real elements will make a property look well cared for and add an appealing sense of life, vibrancy and vitality to a space. They don't have to necessarily always be fresh flowers or plants. A couple of examples:

• Instead of fresh flowers, Vern staged three clear jars with different kinds of hard candy in the entry area of the Urban Oasis New York Unit (he also mentioned "candy is questionable as to whether or not it's organic, but again it's injecting that sense of life to a space").


• A bowl of apples is a great way to go. They can last three to four weeks, are relatively cheap, and they give a lot of life to a space.


• One of Vern's favorite tricks: Monstera leaves in a vase (placed on a nightstand or bathroom counter looks great). They are a couple dollars each and last for several weeks.

4. Edit to showcase a space

Editing is free and an invaluable tool for expanding the visual volume of a room while also making it look neater, cleaner, and more expensive. When it comes to accessories, fewer items with higher individual impact offers the most bang for your buck.

People have a natural tendency to just accumulate stuff. Before going on the market it's important to go through a home and really edit down your belongings so that a potential buyer can visually understand what's happening in the property they're looking at.

An example:

"This is a bedroom from Urban Oasis New York. It's not the world's largest bedroom, but we've done the monochromatic color scheme and we've really pared it down. We put one large, central bed there, we have these pedestals on either side showcasing these keystones from a demolished brownstone here in Manhattan, and these pedestals also have niches so that they serve as night stands. Fewer things, really substantial things. More meaningful things, but fewer things really help showcase the property."

Whether a space has a fantastic view, a tremendous volume, or incredible floors, the highlight of a room should always be underscored dramatically! This is so important because every room has highlights, it's really up to you to now find out what those are and highlight them.

If, say, the highlight is an unobstructed view - put low furniture near the window and keep a monochromatic scheme to not distract the eye from the view.

6. Remember secondary spaces

Finish and accessorize auxiliary spaces. Bathrooms, guest rooms, and home offices should be treated as primary spaces and showcased with furniture, accessories, and organic items to illustrate that a property has many possibilities.

Everybody thinks about the living room, everybody thinks of the dining room, everybody thinks about the master bedroom. But you have to think about the secondary spaces as well if you really want to sell a property.

A couple of examples:

• In bathrooms: include artwork on the walls, place fresh towels in a basket, put a plant on the counter.


• In guest bedrooms: make sure there are fresh linens on the bed, put lamps on the side tables, add an organic element to a dresser.