Home, Land, Property Buying and Selling - Advice: Selling and Moving

My wife and I live just outside of NYC. Property values in our area have skyrocketed over the past few years. We got the house three years ago, just before the prices jumped and could make a nice sum off selling. We want to sell and move to Eastern PA (cheaper, bigger house, lower cost of living, more land, etc.). We are considering putting the house on the market ourselves to avoid paying a realtor.

One of our main questions is when we should actually put the house on the market. We have a few areas in mind, but still need to decide for sure where we want to move. Should we put our house on the market ASAP or find a new place and put an offer in there first? We don't want to wind up getting a new place and having the current house sit on the market as we want to use the money we make off the sale to pay for much of the new house (could pay 60%+). Any advice on what to do?

Also, there are a few things about our current house that could use some work. The lawn is a mess. It is mowed, trimmed, etc. but not healthy. Is that a big deterrant to potential buyers? Should we invest the $$ and time to have the lawn re-done? It is not terrible, but there is a lot of crab grass and some areas where it is a bit patchy.

Likewise, our driveway is half paved and half gravel. It was once completely paved, but was the way it is now when we purchased the house. My wife thinks that re-doing the driveway will make a big impact on the price the house goes for.

And, finally, we have a nice upstairs bathroom, but there is a crack in the tub surround and the tub, itself (an old cast iron tub) has some chips in the finish. Would it be worth re-doing the bathroom or should we leave it as is for the buyers?

As we are still relatively new to being homeowners and are hoping to do this without the help of a realtor, any and all advice would be appreciated. These may seem like obvious questions, but it would be great to get some outside opinions. I'd hate to invest the time and money in the house getting all these things fixed and not have it make much of a difference in what we get for it.

Thank you so much!

Nothing wrong with selling your house yourself, but about once a month someone posts on this site that they FSBO'd and UNDERPRICED the house by as much as they saved in commission. So, proceed carefully in this area, make sure you don't miss any mandatory disclosures. I've bought and sold over 100 houses and I still use Realtors on about 1/2 my deals.

I'd also want to know how much money I'm going to NET out of the deal before I start counting my chickens. Also how much more is it going to cost to commute from PA. If I put $50K in my pocket but I spend an extra hour commuting each day, paying more tolls, or paying more for commuter rail it may not be as good a deal as it initially appears.

Curb appeal is very important in marketing a house, so I'd start working on the yard today, you don't want to miss the busy summer season. I'd also get some estimates on the driveway but not sure I'd re-pave it yet, maybe use it as a negotiating point. On the bathroom, can you use the "touch-up" paint on the chips? On the tub surround, what is it, 4" X 4" tiles? Do you know how to repair the surround yourself. Baths and kitchens are the rooms that sell houses so having it pretty solid is important, but if the bath needs updating it might make more sense to update.

I'd want to have a pretty good idea, (within a few miles) of where I"m going before I put mine up for sale.

Lots of stuff to consider, but one way or the other start on the curb appeal tonight.

Frank

Frank,

Thanks so much for the reply. Let me start by saying, "Damn you, ice cream!! Come to my mouth!"

Your advice is much appreciated. As for adding to the commute, it is not an issue as I work at home. With the lower taxes, health insurance (we are both self-employed) and mortgage, in PA we could live off my income alone, whereas right now we are just scraping by with both of us working. My wife can get work as an occupational therapist in PA for less money, or commute to NY and work one full day at the NY rate and make enough to cover a chunk of the mortgage and other costs, so financially it makes sense for us. We would have to travel the hour to visit friends and family who, on the average, we see once a week anyway, but the main idea is that we can work less and let life slow down so we can actually enjoy it as right now we are both so busy that we only see each other on the way to the next thing we are doing. I also love small town life, woods... she loves to go canoeing and tubing, so being in Eastern PA near the Delaware is a good spot.

That said, we will immediately get cracking on the curb appeal. I don't know how to fix the tub-surround, but have a handy brother. The tub surround is one-piece cut to look like tiles. I will ask the brother to see if we can give it a crack (not literally). I'll see about touching up the tub as well.

We are doing some major research in to areas tonight and should have a solid idea of where we are going in a few weeks after we take a few more rides to check out the areas. In the mean time, I am going to attack the lawn and landscaping.

Thank you very much!!

We had a realtor come over to do a Comparative Market Analysis and she was the bearer of VERY good news. The price she said our house would go for is almost $200K more than what we owe, but in the opinion of the kind folks here, how much of that is smoke blowing because she wants us to list with her?

We are also talking to a few other agencies about coming to do a CMA (have another this Thursday) by way of comparison. Is it kosher to let them know what other agents told us, or even that we had other agents do CMAs?

Also, Frank, you said you still use realtors on half of your deals. We are considering doing it on our own as we could save about $25,000 doing so. I would almost just prefer to do it through a realtor so we don't miss anything and the job is just DONE, but that is a nice chunk of change. Having done it both ways yourself, what would you recommend? Any BIG flubs to watch out for if we do it on our own?

Thank you!

Wow, good news Gregabs! Yes I would let them know that there is competition for your business. As far as letting them know what the other CMAs were, I would only tell them that they're off by X thousands of dollars, and ask them to justify any difference of more than about 5%. You may also need to ask the same question of the first agent.

As far as going FSBO, how comfortable do you feel negotiating for yourself? How much do you know about "selling"? Do you have a pretty clear picture of not only the "must disclose" laws in NY, but also what you can or cannot say that might be inferred by the buyer as a disclosure. That's not to say that most or any Realtor is going to be pretty good about any or all of these, but their broker and local board is pretty much going to keep them within the law.

My rule of thumb is, once the house is really ready to go on the market. Pick an advertising budget, pick a marketing time frame and know how long you're willing to stick with it before calling a broker. Since we're now into July, one consideration is, when does school start in your area?

I've worked with Realtors that I purchased property sight unseen, just their word. Obviously I'd done a few other deals first. On the other hand, the two biggest sales I ever did, I paid commissions, and regretted it. The first one was about $275K, in California, and I live in Texas. Interviewed 5 agents and ended up going with the guy who had had me on his mailing list for 20 years. Complete idiot, he didn't apprise me of the vast differences in procedures and practices int the area, never commented on any of the "should fix up firsts" and when I countered the buyer's offer he told me I was a fool and the buyer would likely not even reply to it. This despite the fact that the buyer was BORROWING 100% OF THE PURCHASE PRICE and wanted to be pay 100% of their closing costs, they had even calculated them down to the penny. Their offer was for $15K less than my price, I countered at $5K over list price but paid the closing costs, they accepted so fast it made my head spin. In the long run I would have been better off buying a 1-800 phone number, paying my sister-in-law $50-$100 per showing and just flown out for the necessaries. As it was I made 3 flights anyway as the inspector wanted to way overcharge me for some needed repairs, Their estimate was about $15K, I did it all myself for about $350.

The last deal was our last house in Houston. We FSBOd because there were so few "patio homes" in the general area, we were in one of the best subdivisions, in one of the best school districts. On a typical weekend 5-15 cars would drive down our cul-de-sac looking for houses for sale. Two weeks after putting a sign in the yard, (we never ran a newspaper ad) we got a full price offer from a gal who brought her lifelong girlfriend, (who happened to be a Realtor) with her. Agent asked us to pay 3% commission, we countered at $500 because I told her I had probably sold as many or more houses as she had. She said she had almost 20 years experience, actually like lots of others, it was one months experience repeated 240 times. We finally agreed to pay her about 1 1/2%. We were seller financing with $40K down and the agent made FIVE MISTAKES ON THE CONTRACT, including using the wrong financing addendum. The "inspector" knew almost nothing about anything structural and managed to damage my car in the garage (and then tried to lie his way out of that). So as usual I did most of the leg work and paid this pini head $1900.

So that's my story, some are good, some aren't. Whenever I sell anything that my plan is to seller finance, I always FSBO those. Because the buyers are buying the financing, not the house. So I'm usually asking about $15K over market.

Good luck and keep posting us on your progress.

Frank

Thanks for the reply, Frank. The info is really VERY helpful and I can't tell you how much I appreciate it (though, I suppose I just did!).

The realtors we are talking to are from the BIG local agencies, so I am pretty confident about their abilities (though I do know that it still comes down to the individual when all is said and done). I was also considering Foxtons, as they are 2% as opposed to the standard 6%. I opened up a separate thread about them, but thought maybe you would know... any feedback on them or have you heard good/bad? I can't help but think that if they are so much less it must be for a reason, but it seems to be a good alternative to representing ourselves. Maybe we'll start with a FSBO and then on to Foxtons... provided we don't hear anything terrible about them in the mean time.

I have had one agency here already for a CMA. Got another coming this Thursday, then another on Tuesday and another to still schedule for next week. I'll be doing a lot of lawn mowing on the days between.

School starts in September (early Sept). We may not get out before then, depends on how fast we find something we like in the new area. Best to sell before school starts, I take it?

I am not familiar with "seller financing." Going to do some searches on it to see what I turn up, but if you can give a quick one-liner on it (or provide a useful URL), I'd apprecaite it.

Thanks so much, Frank!! (there I go again!)

Greg

Sorry, I'm not familiar with that particular one. I've seen "Help You Sell" and "Assist To Sell", in fact my brother used the latter on two deals he did in California and he was pretty pleased. But he's in a REALLY HOT market.

The only way you could do seller financing is if you owned the place free and clear or had a huge equity. Wait a minute, you do have a huge equity. However I don't like being in a second mortgage position so I don't recommend it. I've done about 25 or so deals with some seller financing. The first 10 or so I either did "wrap around" mortgages, or took high interest rate seconds. That was back in the day when you could find houses that had fully assumable FHA or VA loans. Since I lived in Houston then, and the average house had lost about 30-50% of its value over a 4 year period, there were lots of houses with assumable loans. Of course many of them were worth less than the loan value, and the interest rates ranged from 9-16%. Still we did find a few.

As I've gotten older and more financially secure, (I've reached financial "critical mass), I buy for cash, fix up and sell for low down payments (usually $2K), I charge $350 to draw the contracts and I hold escrow for taxes and insurance. Of course I live in an area of Texas where houses are cheap, right now there are 6 houses in our zip code for less than $60K. I try to get at least $15K over my investment and I don't charge real high interest. But then in Texas a foreclosure can be done in about 45 days if you do it right. The funny thing is, it doesn't matter what price range, some people just have that "rental mentality" even when they're buyers.

Two examples, we sold a house in a country club community about 6 years ago. Every agent said to ask $99,000 and settle for $95,000. We asked $115,000 with $5K down, had our pick of 5 buyers. The couple paid the down and all closing in cash, never paid on time once and two years later walked away. It cost me about $3000 to foreclose because we couldn't find him for service of legal documents. I put $7500 into carpet and a lot of other stuff. Again, I asked all the agents and they said ask $110-$115. I was kind of PO'd so I asked $135,000, got it from the 3rd couple that looked, they wanted to pee away part of the down on some other stupid stuff so I agreed to take $3500 down, if they would pay an extra 1/2% interest, they said OK. They then ripped out all of the (admittedly used, but very functional) top of the line kitchen appliances, through them out and replaced them with scratch and dent stuff, of the worst builder grade crap you've ever seen. After 2 years they've paid on time once and pay about $60/month in late charges.

Another true story. A couple that rented our old house and wanted to buy it. At the time they moved in they commented that they'd really like to be able to buy a house, but couldn't afford it. They were earning about 70-75% of what we were earning, but they had TWO CAR PAYMENTS THAT TOTLALED ALMOST WHAT THE RENT DID. Over the next 5 years they bought IIRC 4 new cars, of course they claimed they always beat the dealer on every deal. When we finally got tired of owning, we wanted to move to the lake area, we offered to sell it. They kept wanting a lower price, because of the sweet financing I still think I sold it too cheap. Anyway I told them "it's April now, we need to close by December of next year, so for every $100 over the minimum down payment that you pay me, ($2000) I'll credit you an extra $100". In other words, if you pay $6000 down, I'll knock another $4000 off the price. It took them the full 20 months to come up with the mimimum $2000! The funny thing is, a friend of ours from church, who we had financed on a house after he husband died leaving her in not great shape, told us one of her best friends was the aunt of the wife in our little story, and that they tried to borrow the money from the aunt. The aunt having known this woman her entire life refused her. When the friend from church heard the story she thought, "hmmm, that sounds like something Frank would do".

BTW, in the 3 years since they've bought our house, they also bought 2 new cars! My wife and I bought the first "new" car that either of us has ever owned about 5 months ago. I really don't feel like I've suffered by not ever having had a new car until I was 55 years old.

Well enough bragging about me. Sounds like you're getting your ducks in a row. Now just make them quack on command.

Gotta go, Asian reporter Trish Takanawa is on.

Frank (aka Stewie)

Foxtons only works in NY/CT/NJ - I didn't think about that before I asked. They are a 2% realtor that charge so much less because they don't use MLS. We have them coming for a CMA so I can throw them up against the wall with the rest of the realtors and see if they stick.

Now that I "get it," seller financing is not for us. Don't want to have to chase after someone for the money, plus we are going to take the money we make off the current house to put a BIG down payment on the new one (and use the rest to plan for retirement and fix up the house nice, maybe get a new car since we will be driving more).

Neither of us have owned a new car. My wife's car is a '96, which is the newest we have owned. I drive an '89 Mercury, which is on the fritz, and I got a car from a friend for $200 that is in the shop getting checked out.

It'll be nice to be able to afford a new car (if everything works out). I think we are doing the right thing... even my mother, who was horrified at first at the idea of us moving an hour away, conceded last night that it was a "good idea."

Greg

"My father's worked at that mill for 60 years! That's almost 80 years!!!" - Peter Griffin (Family Guy)

Hello again.

My brother was recommending FSBO for us... just putting out a sign and seeing how many hits we get. He said that if we find a real estate lawyer, once (and if) we get a good offer, we just put our laywer in touch with their people and the laywer takes care of all the legal wrangling. Is it really that simple, Frank, in your infinite wisdom?

I think by the time we sell the house, we are going to have to give you a cut!!