A divorced man in his late 60s was already struggling with medical issues when he was also diagnosed with bladder cancer. He was compelled to put his 1960s-era bungalow up for sale. He needed the money to buy a condo in an assisted living community near relatives.
Even though he’d previously worked as a home remodeler, the owner had let upkeep on his house slide for years. His living quarters were crammed with unsorted possessions, and the whole place cried out for a paint job. But he lacked both the funds and energy to undertake the necessary improvements before selling.
Unfortunately, this true tale didn’t end happily. Though the man’s bungalow was located in a solid suburban neighborhood with forested yards and a coveted elementary school, the property languished unsold for nearly a year. Ultimately, he accepted his only bid -- an extreme lowball from a couple who hauled in a dumpster for the man’s castaways and then tackled the renovations themselves.
John Rygiol, a veteran real estate broker, says selling a house “as is” nearly always results in sacrificial returns.
“These days, buyers’ eyes are accustomed to seeing model-homelike interiors. So, any place that goes on the market in a shabby condition is usually passed over,” says Rygiol, who heads an independent realty firm.
Housing economists say that “as is” sellers must moderate their expectations, especially in the current economy.
“The rise in mortgage rates this summer to their highest level in seven years has made it more difficult for potential buyers to afford a home. The slackening in demand is reflected in the slowing of national appreciation,” says Frank Nothaft, chief economist for CoreLogic, which tracks real estate markets throughout the country.
Nothaft is now forecasting upcoming valuation adjustments for housing, based on CoreLogic’s estimate that 38 percent of all metro area properties are now “overvalued.”
Even though now may not be the best of times for “as is” sellers to liquidate, Rygiol says many in this category simply can’t wait.
Here are a few pointers for sellers:
-- Concentrate on low-cost changes with impact.
Owners with few resources can still increase their odds of getting somewhat more for their “as is” property with little or no cash expended. Even those who must rely on volunteers to make their homes presentable are better off than sellers who do nothing to improve the looks of their property.
“It’s unbelievable the bad reaction buyers have to a house that’s messy,” says Rygiol, who’s affiliated with the National Association of Exclusive Buyer Agents (naeba.org).
Claire Jean Prager, a veteran real estate broker, says financially challenged sellers should consider searching for volunteers by looking on the internet for a support group, such as a cancer survivor network or a nearby faith organization.
“Go to a local church or synagogue and ask if they know anyone who could help you. You don’t have to be a member,” Prager says.
As you embark on a cleaning and decluttering blitz, she recommends you first focus on removing excess furniture and personal items that make it hard for those viewing your place to picture themselves living there.
“For example, I’m talking about all those photos and notes attached to your refrigerator with magnets and all those many family mementos. Get all these items packed up and put away in a storage area,” Prager says.
-- Try to find a listing agent trained to redo your interior.
The current real estate climate has spawned the new industry of professional home stagers. These are people hired to rearrange and supplement furnishings to make properties more appealing.
Mark Nash, a real estate broker and the author of “1001 Tips for Buying and Selling a Home,” says stagers typically charge $300 or more for a minor redo. But if you lack the funds to pay a stager, he suggests you look for a listing agent who will provide such services without charging an extra fee.
“An increasing number of agents are trained in staging, and some are getting very good at it,” he says.
-- Make your “as is” property more saleable with the right list price.
Rygiol says some owners are still tempted to “test the market” with an original list price at the high end of the neighborhood range.
But he says those in this predicament are better off pricing from the outset at the precise current market value of their property, given its current condition.
“Go around your neighborhood and look at For Sale signs as indications of the strongest and most successful agents in your area. Then call three of these top agents, asking them to come over and recommend a totally realistic selling price,” Rygiol says.
He says you shouldn’t necessarily select the agent who suggests the highest list price of the three. Rather, listen intently to their advice on how your “as is” property should go on the market.
“Tell your agent you want to sell in 90 days or less, and ask what price and marketing plan will get that job done,” Rygiol says.
(To contact Ellen James Martin, email her at firstname.lastname@example.org.)