Evanston foreclosure remodeling moving along nicely

Last February, I blogged about how the city of Evanston was going to receive $18 million in grant money to fix up some foreclosed homes in an attempt to lower the inventory of foreclosed homes and make some new homes affordable to low-income families.

Well, the Evanston Review has just posted that some of those homes that were purchased could be available by this summer.

The City has been working with Brinshore Development to get some of these homes ready for rent or sale.  So far Brinshore has purchased more than three dozen foreclosed homes in Evanston to work on.  A few of the homes need minor cosmetic repairs.  Some other homes need complete gut rehabs.

The terms of the grant stated that one quarter of the $18 million had to be used to benefit households with incomes at or below 50 percent of the area’s median income, or $30,050 for a two-person household and $37,550 for a family of four.  About 20 homes fall into this range.   According to the article, the remaining units units have to have the maximum income ceiling of 120 percent of the area median, or $72,100 for a two-person household and $90,100 for a family of four.

The grant also states that the money needs to be used by 2013 and at have at least 100 units rehabbed and reoccupied.  So far Brinshore has purchased and is under contract to purchase a total amount of 70 units.  The article also says, “Of $1 million in subcontracts awarded to date, 77 percent have gone to minority, women and Evanston-based employers, according to the city. Nearly half of the $1 million in subcontracts has gone to firms employing residents from the target areas.”

So by doing this, more money is being funneled into City-based employees and workers.  It’s so nice to hear that everything is moving along smoothly with this grant.  I love hearing that these foreclosed homes are being remodeled so that they’re not sitting unoccupied and creating an eyesore for a neighborhood.  Have you come across one of these remodels in your neighborhood?  I’d love to hear about it.  Please leave me a comment or visit me online.

What not to do when selling

It’s hard enough when you’re stuck selling your home in a buyer’s market.  You have so much competition as it is.  But this MSN article also talks about what’s important when selling your home and what not to do.  I wanted to go over the main points because this is so important.

1. No photos.  So you want to get your home listed Friday to make sure it’s available on the weekend but the photographer can’t come out until Monday.  So you’ll list it and just add the photos early in the week.  That’s a bad idea.  Every buyer who sees your home with no photos will not go back once the photos are in to look at your listing again.  They’ll pass over it the first time and won’t remember they wanted to see pictures.  Another bad idea is only listing photos of the exterior of your home.  Buyers will automatically assume something is wrong in the interior that you didn’t want to show.  It will prevent showings.  As always, make sure your home is in showing condition prior to scheduling photos so that it shows in great shape.

2. Not giving all the details.  It’s very common these days to be viewing short sales and foreclosures, just because of the sheer number of them.  But what buyers want to know when something says “third-party approval” is who that third party is.  What’s the estimate on when they’ll hear back if they’re interested?  It’s as easy as saying a home needs the bank’s approval and you’ll get it in 2 weeks.  Even better, if the bank has already approved a price reduction, be sure to mention that it’s at a bank-approved price.

3. Lies or exaggeration.  Do not say your home is “freshly painted” if that paint job happened 4 years ago.  I just had clients visit a so-called “freshly painted” and “meticulously kept” rental that had marks over the walls and cabinets falling off the hinges.  Be honest.  Do talk about the great features of your home, as long as they’re truthful.  While your carpet may not be new, if it’s neutral in color, that’s a great selling feature so people don’t have to worry about their furniture not matching.

4. Selling as is.  While it’s not always the wrong thing to do, if you’re worried about cosmetic repairs or replacing an out-of-date furnace, just be up front about it.  It’s likely that it will come up during negotiations anyway.  I’ve seen plenty of sellers offering a $2,000 carpet allowance or $1500 for the buyer to choose new appliances.  This is better than having the buyer think everything has been removed from the house to the studs.  

I’d love to know what other tips you have for sellers looking to sell their homes at the moment.  What would you suggest they not do?  Please be sure to leave me a comment or visit me online.

Get creative with incentives

This week I saw an extremely creative incentive offered by a home seller in Libertyville.  The home seller, an interior decorator, offered the buyer of her home an interior design package worth up to $40,500 if her home sold before a certain date.  She offered a similar package for up to $25,250 if it closed a month later.  Now this is someone who didn’t need to drop her price and could offer a skill that would help a new buyer with new furniture and design ideas. 

I mentioned in my blog last week how buyers just want to score an amazing deal.  And seeing how many people don’t just want to give their house away, it’s important to be creative in coming up with other ideas to get the house sold, similar to what this interior designer did.

Typical incentives include free assessments paid for a period of time (for those in association communities), parking paid for.  I’ve seen cars and vacations offered.

I was so impressed with this idea to offer an incentive of a skill you possess … You could even offer to pay for the buyer’s attorney expenses in purchasing your home or cover their home inspection for them.  Another great idea is to have a home inspection done at your cost and made available to the buyers looking at your home.  That way there’ll be no surprises when you’re under contract and the buyer goes to do their own inspection (NO MATTER WHAT – DO YOUR OWN INSPECTION!  I’ve heard horror stories of people that skipped it and there’s no recourse against the seller unless they purposely falsified information).

Some other creative ideas could be an appliance package of up to a certain amount of money, a landscaping gift card, a gift card to a popular hardware store or Target, for example.  And while this might work for some, others would just prefer to knock the price down by that amount, which is fine, but you never know.

Another simple gesture for your new buyer is just to leave a bottle of champagne in the fridge when you move out welcoming them into your home.  I’ve had buyers call me so impressed that sellers have done that for them.  It really just puts a nice spin on a stressful situation of moving.

Do you have any other creative incentives you’ve seen or that have impressed you?  I’d love to hear them.  And if you’re selling your home and would like some ideas of what to offer, please contact me via my Web site.

What buyers are looking for this year

We all know there’s a lot of houses on the market.  Inventory is high.  Values are down.  It’s harder to get a loan.  Interest rates are low.  People’s discretionary income is lower.  So what does all this mean in terms of the housing market?  Here’s a list of some items that Bankrate.com has put together of what home buyers are looking for when they buy a home this year.  This will also help sellers be aware of how to stage their home and what buyers are looking for when it comes time to negotiate.

1. A deal.  An amazing deal.  They want to tell everyone they know that they got this amazing house for such a good deal.  In 2007, it would have cost them $500,000, but they just closed on it for $395,000.  So this makes them a lot more critical.  They’re going to take longer than usual to find a house.  They’re not going to feel like they have to settle.  And that’s because they don’t.  Unfortunately for sellers, buyers hold the power when negotiating right now.  So understand that when turning away a low offer.  It might be worth it just to counter to see what happens.

2. Good condition.  I mentioned before that discretionary income is limited.  They don’t want to have to redo carpet and paint and put in new appliances.  They want homes that are more updated and in good condition.  When showing your home, make sure it’s clean and presentable.  It’s like putting your best foot forward at a job interview.  You only get one shot.  Make it a good one.  And reconsider taking your appliances with you when you move.  It’s likely the buyers want them to stay with the home.

3. More green.  It’s a lot more common these days to find buyers looking for energy-efficient appliances, windows, furnaces, and air conditioners.  Again, this helps them save money down the line, aside from being good for the environment.  Buyers want to know that maintaining their home will be easy on the wallet.  So if you are looking to sell and plan to upgrade some items, try to go as green and energy efficient as possible.

4. Smaller homes.  This is not to say that if you are selling a 5,000 square foot home that nobody will be interested.  But consider how you stage your home.  Make use of space.  It’s more common that buyers aren’t interested in a sitting room.  Make it into an office.  Create a craft room with your sixth bedroom.  Buyers want homes that serve a purpose because they don’t feel like they need the extra space if all it is is just space.  “Three to five years ago, if they could get a loan that would get them into a McMansion with stone and tile and brick and more rooms than they needed, they would do it,” says Jeff Wiren, president of the Portland Metropolitan Association of Realtors. “Now they’re saying ‘I don’t know if I want to heat that place and clean it.’ They’re being much more realistic.”

So those are four of the nine items that Bankrate thinks buyers are looking for in 2011.  What do you think?  As a buyer, do you agree?  I’d love to hear your thoughts.  Please leave me a comment or visit me online.