64 reasons your house may not be selling

by Nick Molnar on March 20, 2013

64 Reasons Your Home May Not Be Selling

  1. It smells like cat
  2. It smells like dog
  3. It’s overpriced
  4. It isn’t in the MLS
  5. You have no photos
  6. You have only one exterior photo
  7. Your photos is from another season – a snowy photo in June advertising
  8. Your exterior front photo shows one big tree with a hint of house behind it
  9. Your bathroom photo shows a corner of sink and the toilet
  10. Your bathroom photo has the toilet seat up
  11. Your photos are pixelated
  12. The basement is dank
  13. The house is dirty
  14. Your agent doesn’t respond to showing requests
  15. You don’t accommodate showings
  16. You don’t clean or prepare for showings
  17. You stay at the house during showings
  18. You leave an aggressive pet in the house during showings
  19. The house is overfull of furniture, toys, clothes, and “stuff” and potential buyers can’t see the house
  20. Bad luck
  21. Your school district has low test scores
  22. You don’t have central air
  23. You don’t have a dishwasher
  24. Your kitchen is closed off from the living space
  25. You’re selling a condo in a failed and half-built project
  26. You’re selling a spec house in a failed and mostly-empty subdivision
  27. Your house lacks curb appeal
  28. You’re at a price point that excludes most potential buyers in your city
  29. It was a meth house
  30. It’s falling down
  31. The neighbor’s house is falling down
  32. The neighbor’s yard has junked cars and trash everywhere
  33. The neighbor has frightening dogs
  34. The taxes and HOA/condo fees are high
  35. It smells like smoke
  36. You’re a day-sleeper and have painted all the windows black
  37. Frequent gunshots are heard during showings
  38. It has a “spooky dungeon-like” basement
  39. Obvious fire damage
  40. Mushrooms growing in basement
  41. Crazy neighbors harass potential buyers
  42. Your homemade indoor shooting range isn’t to code
  43. Your collection of 300 decorative Elvis plates distracts buyers from home’s best features
  44. No for sale sign
  45. 2×4 appears to be propping up joists in basement
  46. Built-in microwave in bathroom puzzles buyers
  47. Your house costs twice what anything similar has sold for recently
  48. Your valuing your $30k sunroom at your cost
  49. Wallpaper
  50. The fusebox is the most recent update in the house
  51. Fleas
  52. Your floors bounce
  53. Your floors slope
  54. Raccoons in the attic
  55. Carpet in the bathrooms
  56. You don’t negotiate
  57. Newer development is pulling away your buyers
  58. No yard
  59. Ugly yard
  60. Backs to industrial lot
  61. Next to Wal Mart
  62. Errors in property info – “0″ square feet, incorrect bedroom count, etc.
  63. Your agent has a reputation that makes other agents prefer to not work with her
  64. Road noise

That’s a long list, and that’s off the top of my head. But if you categorized them, you’d quickly find there are really just a few groups:

  • Price: self explanatory
  • Presentation: Can buyer’s find the house is for sale and does it look great online?
  • Preparation: Is the house clean, de-cluttered and free of the “ick factor?” Does it smell good? Does it appear to be taken care and give a good impression when you walk up to and into the house?

The most effective way to sell a house is to

  • get a whole house inspection and fix the problems it uncovers
  • hire a stager and act on their advice
  • obtain an appraisal and price it at or below the appraised value
  • hire a real estate agent who sells in your area
  • use a professional photographer

Those five people will help you avoid ending up unsold and on a list like this. But it many cases it’s not practical or possible. In those cases, be sure you’re addressing the same concepts of price, preparation and presentation. If you have to pick just one professional to help you, go with a real estate agent, but only if it’s one who you are confident can reasonably stand in for the others.

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South Bend Real Estate Report: September 1, 2012 – February 28, 2013

by Nick Molnar on March 5, 2013

Pick your favorite news source and odds are it’s promoting a story of a housing recovery this Spring. Another not-too-risky bet is that it called the drop in house values and the slowdown in sales the “correction” of a bubble.

But it can’t go both ways. If the crash was a correction, then prices headed back where they were is re-inflating a bubble. Using terms that conflict with themselves is just one symptom of the news media repeating press releases undigested.

And there are strong forces pushing a ‘recovery’ in housing prices:

  • record low interest rates,
  • diverting of homes that would hit the market to >100% LTV refi programs,
  • delayed foreclosures eased by government bailouts of banks,
  • low-downpayment government-insured loans that the open market won’t offer,
  • REO to rental funds buying now to rent and then sell/IPO in a few years in anticipation of higher prices,
  • Cities including South Bend spending millions to demolish abandoned homes
  • And the drumbeat of “buy now or pay more later” that I thought disappeared in 2008.

But the most problematic element is that, after the most catastrophic housing market in 30 years or more, thinking has not changed. A rational view of the housing market is that any change benefits someone and hurts a different group:

  • Prices go up? —-> good for owners, bad for buyers.
  • Prices go down? —-> good for new buyers, bad for sellers.
  • Prices are stable? —> good for communities, banks, and long term investors, bad for flippers.
  • Prices fluctuate wildly —> good for quick turn traders, bad for most everyone else.

The unspoken idea that constant appreciation of real estate prices is to be desired and is a positive outcome is driven by groups who benefit from rising prices; banks, real estate agents and established homeowners.

Early Spring sales in 2013 are not wildly better than in recent years. February sales volume is down 2013 compared to 2012. Even if they were up, it pays to be cautious making 30 year decisions on two months data and to ignore anything the mass media reports on real estate. There is probably no market more manipulated than the housing market, and it pays to think your decisions through carefully after getting advice from someone who knows the relevant area -think blocks not cities.

Here are the numbers from the Greater South Bend – Mishawaka MLS for sales 9/1/2012 – 2/28/2013. That bring us up to date on this blog.

  • September 2012: 254 sales for ~26.9 million in volume
  • October 2012: 270 sales for ~28.5 million in volume
  • November 2012: 241 sales for ~30 million in volume
  • December 2012: 206 sales for ~24.5 million in volume
  • January 2013: 163 sales for ~15.3 million in volume
  • February 2013: 181 sales for ~14.8 million in volume

Here are the graphs:

All sales prices at a glance, coded by type of financing:

Sales-Sept2012-Feb2013-Scatter [320x200]

 

For clarity, the same graph excluding the 28 sales over $350k:

Scatter-9_12-2_13-to-350k [320x200]

 

For context,  the long term sales graph:

 

Long-Term-Sales-Graph [320x200]

 

And that same graph showing only Q1 for 2008-13

Q1-sales-2008-13 [320x200]

 

So if the market overall is still anemic, where is the media finding stories of homes selling in days with multiple offers? They are finding the markets with an undersupply of homes for sale, those lacking a Realtor’s “inventory.” And it’s true, there are spaces where it is good to be a seller right now. In Granger, if you have a decent house without any major flaws (on a highway, under a power transmission tower, with a failed septic system, etc) that is in the $250-300k range, you’ll probably sell it.  Here’s my reasoning:

Granger easily supports that price point (graph below does not show the few sales over $1m, but does use them in calculating the trendline)

46530-sales-long-term [320x200]

 

And sales in zipcode 46530 at the 250-300k price point have decreased from the boom, but seem to be on stable footing

46530-sales-250-300 [320x200]

  • 2008: 48 sales
  • 2009: 34 sales
  • 2010: 39 sales
  • 2011: 44 sales
  • 2012: 55 sales

So, it’s uncertain but reasonable to guess that  about 44 will sell in 2013 (the average of the post boom figures). And there are 21 for sale today, with 2 closed sales this year and 4 pending sales. That’s 17 short of expected sales. More buyers looking for a type of house than sellers selling that type of house = few days on the market and selling near list prices.

But that setup is particular to specific niche markets. If you are selling a farmhouse on 5 acres or a townhouse near Notre Dame or 1920′s house in South Bend you might as well use stats from San Francisco as those from Granger.

If you’re buying or selling or just trying to better understand real estate, don’t follow the TV news. You won’t get good information in a 30 second segment put together by a reporter contracted to produce ten stories a week. And it won’t be specific to your situation. Do your homework, or hire someone to do it for you. The real estate market is no longer moving as a single block. It is fractured so that some markets lack inventory and some lack buyers.

More frequent posting to commence. Have questions? Need advice? Hit the comments or find me with your favored messaging system, http://www.realst8.com/contact-us/

-Nick

 

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Irish Crossings Nears Completion

by Nick Molnar on September 21, 2012

Buying a South Bend condo can be a difficult investment choice.

You can buy in an older complex. Most of these are in “B” locations a bit further from Notre Dame, and several are starting to have maintenance concerns. Many of the units need updating. On the plus side, the price can be very attractive.

Or you can buy in a newer complex. These are mostly in prime locations walking distance to Notre Dame, restaurants and shops. They are generally larger, have modern floorplans and finishes, and have better parking. But they cost more, often 2-4 times the price of the older condos.

In itself, that is a straightforward decision – pay more and you get more – and the newer condos and townhomes have mostly been winning the last five or six years.

But there is another concern that comes with the new condos – build-out hassles and risk of buying into a development that later stalls.

Build-out hassles are clear with a moment’s thought. Construction is noisy. It’s dusty and dirty. It requires lots of traffic, lots of trucks and leaves lots of trash. It’s generally not an environment in which you want to spend time.

But failed, slowed or stalled developments are a less obvious risk. Once you buy a townhouse or condo, you are tied to that development. If sales slow several things can happen:

  • The developer might change the plans for future buildings or phases. If the new units are significantly smaller or less expensive than your unit or they clash with the existing units, that could change the personality of the community, and the price of your condo.
  • The developer could drop prices on future units to spur sales. This drops the value of your condo below the amount you paid for it.
  • The developer could fold and fail to complete the project. This is the worst result because it could make your condo essentially unsellable. It will take time for the bank who financed the project to take the property back and to sell it. The future buyer will have different plans for the project. Those likely include making future buildings rentals, leaving you owning a condo in an apartment complex that is very difficult to sell.

South Bend has seen more than a few condo projects fizzle, flop or fail to get off the ground. A partial list would include:

  • The Notre Dame Avenue Townhomes
  • Legacy Square
  • Gameday Hall of Fame
  • The JMS Conversion
  • Colfax Place
  • Keenan Court
  • The North Douglas condos

So that is the downside risk to buying a new construction condo in South Bend.

But there are several ways to minimize risk when buying a new South Bend condo or townhouse.

  • Choosing a community with popular features and an attractive location can help ensure you buy in a winning complex.
  • Finding a community with the best selling floorplans can help ensure you buy a property that will have continued demand when it’s time to resell. To date, multi-level townhouse properties have sold better than other styles.
  • Choosing a community with a good history of sales at or above the price you’ll pay is a good sign there is demand for the properties at/above the price you’ll pay.
  • But the simplest and surest way to be sure you’re buying into a successful community is to buy after it’s nearly complete. If you buy the last, or one of the last properties competed in a community, you know exactly what you are getting. You can get the sold prices on the other units. You can be sure the plans aren’t changing after you buy. And you can talk to other people who have bought in the community and see if they are happy or have complaints.

Irish Crossings has hit the point where it is a compelling buy compared to other communities. In fact, Irish Crossings is the most successful residential real estate development in South Bend, or anywhere within 10 miles on Notre Dame, in the last 5 years. Of the 78 properties in the community, 76 have been built and sold, for more than $30 million altogether.

The final two townhomes in the community are now being completed and listed for sale. It’s an opportunity to buy one of the last units at Irish Crossings and a good way to buy a known commodity and limit your risk if you’re buying a Notre Dame townhouse.

Full disclosure, I am the listing agent on these last two townhomes.  You can find more details about them here: http://irishcrossingstownhomes.com.

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South Bend Real Estate Report: Through August 31, 2012

by Nick Molnar on September 14, 2012

Here are sales statistics for sales through the Greater South Bend-Mishawaka MLS through the end of August 2012.

 

And for clarity, here they are removing the years before 2008.

 

All the sales 1/1/2012 – 8/31/2012 at a glance

 

and those sales by financing terms:

 

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South Bend Foreclosures – What banks sold in the first quarter of 2012

by Nick Molnar on April 22, 2012

Here’s a snapshot of the foreclosure market in St. Joseph County (primarily South Bend / Mishawaka / Granger) for the first quarter of 2012.

There were 131 such foreclosures sold, but just 12 at $100k+. Here are all the recorded sales prices:

Click on the images below for interactive maps with details. You’ll need to zoom in to South Bend as a few addresses mapped incorrectly. You can ignore the markers out of the state. Once you are in the area, you can click the icons for addresses, prices and links to details of homes for sale.

Everything

There were 131 sales of foreclosed homes recorded in the area’s MLS between January 1 and March 31.
There were 106 foreclosed homes listed for sale in the area’s MLS when I pulled the data on April 19.

Foreclosures in St. Joseph County that sold Jan 1 – March 31 and all foreclosures listed for sale

 

Only those over $50k

36 foreclosures sold over $50k in St. Joseph County January 1 – March 31 and 43 foreclosures are listed for sale at $50k+

 

If you’re looking to buy a South Bend area house at a price over $100k, you won’t find many foreclosed options, just 24 are listed for sale at the time I write this. If you’re willing to deal with the uncertainty and slow responses that are part of buying a short sale you’ll find more choices by including those in your search – there are 107 short sales for sale now and 28 of them are priced at $100k+.

And there are well-priced homes included in homes that are neither foreclosures nor short sales. There are 946 houses for sale over $100k in the county right now. Limiting your search to the five or six percent of these homes that are short sales or foreclosures may not be the best way to get a good buy. It may take filtering out some overpriced homes, and even writing some low offers, but considering all types of housing is a smart choice before you buy.

 

 

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