Skip to comments.To Sell or Not To Sell?
Posted on 07/12/2010 6:19:12 PM PDT by ggrrrrr23456
My mother is preparing to sell the home that she and my late father have lived in for more than thirty years. Luckily, the housing market hasn't affected her that much since the area she lives in has become a hotspot for real estate over the years (Bay Area, CA).
The realtor she has been working with is, in my opinion, being pushy. He wants her to sell the house as soon as possible (within the next two months) and I'm of the opinion that she needs to wait given the depressed market and current economic situation. She also doesn't move as fast as she used to, and two months of packing, remodeling, maintenance, and whirlwind activity won't be good for her health.
I've insisted that she get at least two or more opinions on what to do with the house, but the current realtor is an apparently good salesman as she hasn't taken the initiative to talk to anyone else.
Does anyone have any input or ideas on this? Any realtors out there that can give me some inside information, or at least an inside opinion?
Thanks so much.
A real estate agent who wants to low-ball the price and get the house on the market and to closing asap....shocking...I’ve never seen such behaviour in these folks of high integrity.
The selling agent wants his commission and he wants it now.
They are the worst people in the world to get unbiased advice from.
Don’t let the agent pressure you, but do figure out what the carrying costs of insurance, maintenance, and taxes (and lost opportunity costs on the money you’d get from a sale) are and compare them with what you think the rate of price recovery will be. Sometimes it isn’t worth waiting, although that’s a hard decision.
The depressed market may just get much more depressed. If you really need to sell then sell asap.
Remind you mother that the profit of the sale is going toward her retirement at a time when the gov’t is forcing every vendor to raise prices... she has to be smart about the sale, and that begins with multiple opinions.
Do your own math for the area:
120 x Monthly rent < cost of house?
3 x avg yearly salary < cost of the house?
If not - then sell as the area is STILL overvalued.
Use a website like Realtor.com to see what other similar homes in your Mom’s area are being listed for. If there is no hurry, and the house is in good shape, the house should be listed at the high end of the price range of comparable properties.
When we sold our house in the Bay Area, we had three agents and three proposals. If this agent is pushing and is telling her she can sell the house in two months he maybe pricing the house to low.
If her health (mental and physical) is diminished it may be necessary to take over, allow her to lean on you for help in making the decisions. It may also be necessary to talk to the agent.
In my opinion based on nothing other than what I am seeing is this: sell now, it is going to get worse, much worse. In additions there are some tax issues coming up, and your Mom may get stuck paying more taxes than she would if she sold this year.
Good luck and God Bless you and your family.
I'm talkin' with a lot of real estate people these days, and the smart ones admit we're in for another three years of a sh*t market.
Good luck with whatever choice you make. I have no choice because I have three hongry siblings who want their share "yesterday".
The longer you wait, the worse it is going to get.
First and foremost, do what is best for your mother's personal situation. If she needs the money and needs to move, do it, don't try to play the market if it keeps her in a bind.
Second, remember that a real estate agent is a sales rep and is trying to pay his/her bills as well, which means turning property. This can work to your favor as much as it could be harmful.
Third, if the economy gets worse, high cost of living areas like the Bay Area may have a more drastic hit. It is harder to pay for housing there than in areas with moderate costs of living.
Explain to your Mother that this real estate agent may be flattering her and catering to her, but his only concern is NOT your Mother, nor her financial well being.
He just wants to get his commission and move on, and he is pushing her, to keep her from taking her time and maybe find another agent. If he is so good, then after she consults with other agents, she can always go back to this one (though from the way he is acting, I would not recommend it)
I would recommend that your Mother put the agent “on hold” — “don’t call me, I’ll call you”, have her take her own sweet time with packing, repairs, THEN, when SHE is ready, consult multiple agents.
It seems there is NO rush, except the pressure from the real estate agent.
The market in the Bay Area is not going to go down, if anything it’s on the upswing again, so there is no rush to sell.
Your Mother should take her own time, even deciding whether or not she wants to sell in the near future, or just live in the house for a few month, six months, a year...
It appears to me that the entire thing is driven by an unscupulous real estate agent.
I am quite familiar with real estate and agents — please tell her that she has nothing to lose, everything to gain by taking it slowly.
Good luck, I hope she will stop and think it through.
I thought they would want to sell quick and high as their pay is usually a percentage. A $50K higher price at 2% commission is $1K more in their pocket.
I’m an inactive No. CA realtor.
She either wants to sell it or not. That’s the driving directive. Setting a too-high price in order to sound out the market is a very bad idea. Setting a too-low price to blast the thing out is also not such a great idea. Someone (with experience and skill) has to research the price and come to a conclusion. The realtor is typically competent to execute that study, but may well be biased in his/her desire for an easy deal. One thing I can tell you is that your odds decrease a tad if you end up selling past Sept-Oct, so your window into that period is about to slam shut. The biggest factor is CA real estate pricing is the regard in which the local school district is held. There’s nothing you can do about that. But you should know about it.
You sound like you may be sort of interested in this transaction or lots interested in this transaction. Better decide which.
The realtor is being aggressive, perhaps, which is what you want. Again, if she wants to sell. To do that, the realtor does indeed want his/her commission.
It’s not uncommon for folks engaged in buying or selling their homes to have all manner of regret and remorse. IMO more than half of a realtor’s job is to push the participants.
The Bay Area (if that’s where you are talking about) has undergone some price strengthening, and IMO it would be a reasonably ideal time to sell into it.
Personally, I believe it’s not a great time to buy, but my opinion and reasons in that regard have nothing to do with your Mom’s situation.
If you believe that rates will rise later on, and that further evidence of economic weakening is about to occur, then I’d be putting out the for sale sign forthwith.
My advice to you is do the homework on your real estate agent. There seems to be a lot of less than honorable agents out there.....
Now my friend had a real estate agent in CA she really liked, I would be happy to ask her if this real estate agent could recommend someone, just FReepmail me if you want.....
All real estate is local.Yes,many markets...particularly in CA,NV,AZ and FL are bad and,in the case of Florida at least,is expected to get worse.But the Bay Area could possibly be stronger than most..perhaps much stronger.Only someone familiar with a particular market can give reliable advice.
My advice: interview at least three real estate agents, get a professional appraisal from an appraiser not from the RE agents, talk to a RE attorney and last but not least consult an accountant regarding your mom's finances, goals and any upcoming tax changes.
Best of luck to you and your mom.
Since realtors only get about 2% of the price, after sharing it with the buyer’s broker and the office where they work, they make a lot more money selling multiple properties at a lower price, than working the get the best price on one property, they spend more time, than the extra few $K they would get.
Sell quick is the motto and in a slower market, you can only sell quick, if you sell cheap.
This is from Feb 2010 data, but, as I said, prices are starting go up in the Bay area.
Please see link:
What matters the most is if you have a real need to sell or if there is just no hurry. That s/b your prime motivation IMHRO!
Even in a bad market, a well cared for house priced right will sell fairly quickly. Its when folks have those deferred maintenance issues and other factors that will make a dwindling buyer pool even smaller and make things really tough for a seller in this market.
Plus, you really do want to price your home correctly and sell quickly because a house that lingers on the market screams OVERPRICED or to that small group of searching buyers that are serious about buying will develope an impression that there’s obviously something wrong with that house even though they haven’t even seen it.
If you have a trust issue with an agent, interview others and either confirm your suspicion or possibly come away feeling more respectful of that agents negotiating skills.
You can probably tell what I do for a living. Main thing be happy with your decision its pretty important that you make the right one. :) Good Luck
I suspect the realtor is starving. It’s not a good time to sell here in LA — homes are just sitting here. And ... I never do anything in a hurry if it is somebody else’s hurry. Act in haste/ repent in leisure, you know.
Sell, but don’t sell cheap.
If you have a 6% commission on a 500,000 house as an example, his/her cut is 7,500 (1/4 x 6% X 500,000). If she can get the seller to come down to 450,000 for a quick sale, she makes 6,750. Now that's 50,000 real dollars out of the sellers possible proceeds but only 750 from the realtor and believe me, she'll do it in a heart beat, EVERY time.
Whatever you listing price is, no matter how fair it is, I guarantee you it’s only the opening bargaining price as far as the realtor is concerned, especially in today’s market. It’s an ugly fact of today’s market.
Realtors have only one objective...sell quick and cheap.
They are the worst people in the world to get unbiased advice from
I take offense to that comment. First of all, why is the woman selling her house? Is she behind on her mortgage? Has she considered other alternatives? To decide how to comment I would need all the facts. My information would definitely be unbiased as I am a resident and realtor from another state and have no skin in this game.
I can help you. Contact me privately if you wish. I’m in Florida and have been a realtor for over 20 years.
You really need to stop and think it through. If you sell your home or a home you inherited at a loss you can’t take the loss on your taxes.
It’s better to rent the house for a few years and if it’s been put in service as an investment you can take the loss. Plus you can take depreciation and write off all expenses if repairs are needed. All expenses include all the travel needed to visit and take care of the place. At approximately .50 a mile you can write off a lot for every mile you have to travel.
A good (I mean really good) tax person can save you much money. If you can try to explain the tax advantages to your siblings. They probably won’t listen so it may pay to buy them out.
She sounds like she is old, tired, and overwhelmed.
If you want to protect her you will probably have to take over.
Just offer to handle everything and get her ok before making any major decision.
She will probably be relieved.
She should take her time. The current lousy market will be waiting for her.
To take away stress, time and project planning is necessary. She needs to make lists of what she wants done and the scheduling of those activities. I hope she will hire some help. She will be sorry if she hurries and does not do things right for herself. Just sorting through the stuff and getting rid of what you can’t take in a move like that is stressful and takes time. It is a big move!
The realtor works to sell houses and they are hungry as heck right now. He/she should not be pressuring your mom in any way. There is no hurry as far as the market goes and that is all she needs to be concerned with. But he/she needs a quick sale to eat right now so he wants it to get listed yesterday. The realtor’s concerns are not for her.
When we sold our house in the Bay Area
Having lived in the house for 30 years, has it been updated or will it be a handyman’s special? With bay area prices sky high, even in this period, often buyers shelling out $500,000 or more aren’t going to get exited about an old house that needs work. The market narrows to fewer buyers.
Get several opinions for more complete advice and go over agent resumes and recent sales. Consider staging the house and clean out the 30 years of junk that has probably accumulated over the years.
We were in Sunnyvale, in an Eichler.
You are so correct, reduce what you have in the house 80% at least. Stage using common sense.
We sold four years ago at the peak, received an unbelievable price.
In Santa Barbara now, see adds for houses at 2.5mil that are fixers. Lucky to be buying a nice condo (short sale) never do that again.
Thanks for the advice/info. I sure hope the poster figures it out.
We sold four years ago at the peak, received an unbelievable price.
We sold in 2002 5 blocks from city hall in SF as the boom was getting started but made a killing also, making retirement possible. I feel so sorry for those who expected to do the same and are now stuck with this economy.
We moved down at retirement in Palm Springs when the prices were still dirt cheap compared to SF so it has worked out well for us
Here’s an idea, if you’re game for it... this is how I sold my house in 2000 during the dotcom crash
Hire a real estate agent for a fee to do a comparison for you. Pay them, say, $100 for 3 comparables in the neighborhood. Tell them that you want to list the house yourself for 60 days (or whatever), and if you don’t sell you’ll give them first shot at representing you, provided you can come to agreement. I would think most agents would accept this; I had no trouble finding one to do it.
Go to a sign shop and have a sign professionally made that says ‘FOR SALE (Phone Number) BY APPOINTMENT ONLY’. When I say a professional sign, I mean a realtor-looking sign, metal, printed. Use simple type, nothing fancy. That will cost about $75. If you’re clever, have them make a magnetized sign that you can attach to it that says, ‘Open House SAT/SUN 1-4’ or whatever. Put that up every other week and have a pleasant but disinterested person sit at the showings for you. Have any questions referred to your email address.
Have a graphic artist make a flyer. Supply him with photos and bullet points of the the best features of the house, including the asking price and an email address to write with questions. You can find an example of one of these outside of most properties that are for sale. Have a bunch of them printed, in color. You could do them two to a page, cut them in half, to save a few dollars. The idea is to have a professional presentation. Total cost, less than $100.
Place ads on Craigslist, in the paper; with permission put the flyers up at the grocery store, coffee shops, etc. Expect realtors to come by and offer advice and pressure you to sign with them. Politely tell them you have someone in mind if you don’t sell
Contact a real-estate lawyer up front and get copies of the proper offer and disclosure forms, and a little bit of advice on selling yourself. I got this for free by telling the lawyer I’d bring him my eventual sale. He was pessimistic, but gave me some free advice anyway (I had questions about what to put on the seller’s disclosure, how to talk about taxes, utilities, neighbors, etc).
When the time came we had our first open house. We got a half dozen offers the first day, all nearly on the money. Did we underprice? Maybe so, but we had a unique house for the neighborhood and were eager to sell so we could start construction elsewhere. With six offers in hand I called our original real estate agent and told her of my ‘dilemma’. She offered to coach me through it for a flat $500 fee. She earned it.
We ended up selling for 100% of the ask and getting 3 months to ‘rent’ back during construction.
Our attorney was very surprised when we called him to set up the sale; we closed in his office. I think he charged us ±$700
Your mileage may vary, but I’d do it this way again if I were a seller.
Having been in the business for over 30 years, I can’t tell you how many times I have told friends and relatives to NEVER go under contract to buy a house until you have SOLD and SETTLED the house you are in now. Rent an apartment for a few months if you have to, but NEVER put yourself in a position where you are pressured into selling below market. Real estate agents love that situation - - the clock is ticking, you need the funds to settle on your new house, but you still haven’t sold your old house, oh what to do, what to do, the clock keeps ticking, oh no..!!
...And I could revel you all night long with stories of people who didn’t listen and ended up having to sell their houses to waiting vultures (often, real estate agent/speculators!) for way-below market value.
It sounds like you mother, smartly, has no such pressure. Get several CMAs from a variety of agents (ie., make them compete for the listing) and then sit tight and wait for your price, with no pressure, screw the “hurry up” real estate agent. Also, do not sign any listing agreement that has a term of over 6 months.
If she gets those opinions from two other realtors then she will only hear more of the same.
I suggest that you find a very good appraiser and see what he has to say about value. If it is where you want, then sell. If not, hold.
BTW, do NOT ask the realtor for an appraiser, do some research and find a good one on your own.
I’m sure there’s always the exception to every rule and nothing personal was intended.
Fortunately, all the kids just want it liquidated; it wouldn't be at a loss and the small gain won't be taxable.
yes — I have friends in another city who bought a new house before they sold their old one — then it took more thana year to sell the first — wiped out their finances.
Seems like common sense to, not to buy before you sell. I was shocked that they did this.
My Father sold his Mother’s San Francisco home after she died. He sold the home in 1996.
1996 turned out to be the bottom of the prior housing boom that peaked in 1991. I told my Father that he would be selling short if he sold. He sold anyway and missed the entire savage illogical housing boom that peaked in 2005/06.
You are asking if your mother should sell her San Francisco home or wait.
Ask yourself is housing at a bottom. I think we are not at bottom and prices are still going down.
Conclusion: sell now.
Ask yourself if housing is poised to surge and we are heading for a new boom. I don’t think a new housing boom is on the horizon. Housing could be down another decade at least.
Conclusion: sell now.
Ask yourself if we are heading for a deflationary depression. If you believe we are, then housing prices will crash as unemployment surges and economic activity plunges.
Conclusion: sell now.
Ask yourself if we are heading for solid double-digit inflation. Over the long term, housing ALWAYS ALWAYS ALWAYS rises with the rate of inflation. Period, end of discussion. If you see meteoric inflation on the horizon, you want real assets including property.
Conclusion: do not sell now.
So there you are. Look in your crystal ball and make your best guess. I see high inflation coming down the path very far in the future. I see a depression in the meantime - maybe 10 years of depression. Maybe milder than the 30s but still a depression.
If I am right, then she will want to sell now, as there is no financial reason to wait for later.
You don’t say where she is moving to. Moving into a home? Moving in with you? Buying a new home? Moving into an apartment. Where is she supposed to live when she sells? Leaving that out could change the equation, but I doubt it.
If you think she should wait because “house prices are depressed now”, I don’t think they are going up soon and should fall further in the short term. You have nothing to gain by waiting a few years. A couple of decades when we get massive inflation, then yes, but not a few years.
I do not agree that 120 x monthly rent applies to the bay area. I would use a minimum of 150 x monthly rent and I don’t think 180 x monthly rent is unreasonable for an especially popular neighborhood or expecially nice home (with views, vanity zip codes, etc.)
You cant just treat San Francisco proper like suburban Atlanta. It doesn’t work that way. Yes, rents in the bay area are expensive and 120x monthly rent should work on paper, but it does not work even now.
During the housing bubble, some homes went for over 300 x monthly rent.
I agree with your principal but not your number. I would not expect to get a home in any peaceful, non-crime ridden area in San Francisco for less than 150 x monthly rent.
They'll tell ya a dozen times, lower the price, lower the price....lol...
All they are thinking of is their commission...It's really disgusting...(I know people in the RE biz)
Trust me, these folks are on the same level as used car salesmen and only think of their own wallets....
Tell them for every thousand you lower the price, you'll lower their sales commission $700.....Write it in the contract!
That will get them to shut up...lol
Very interesting! Saving your post.
This is such an interesting thread.
So many posters in threads about real estate don’t believe that the housing market is going anywhere, but DOWN, for quite some long time.
What happens to realtors if we do experience not another year, but rather, another decade of houses not selling with any resemblance of speed?
We recently learned that some houses in our city have come down in price by almost 30 percent since their initial listing less than half a year ago.
NOT huge numbers of properties, I just wrote, “some,” and really, for all I know, they were initially overpriced on purpose, hoping that the $8,000 housing credit would lure a buyer in.
Just learned yesterday that non-selling houses can be removed from the market, and then are re-listed on the housing market with a new MLS, making it ‘appear’ to be a new listing ...... having just learned about this yesterday, makes me think that maybe people are all playing a serious waiting game to see how far a price will plummet, before paying any serious attention to a truly new listing.
Sounds like a mine field, how can realtors possibly support themselves, isn’t their commission contigent upon the selling price?
Taking a house off the market and then putting it back on again a few days or weeks later is a trick used here to. It re-sets the ‘days-on-market’ clock so that prospective buyers won’t think it has been on the market for a long time. What a buyer has to do is to ask to see the ‘listing history.’ This will show you for how long it has really been for sale.
It might be a good idea for her to get an appraisal done by an independent appraiser (not someone the realtor recommends).
Bay area? Pushy salesman? Perhaps God is using this aggressive agent to save your mother's life, to get her outta there ASAP.
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