Your House Usually Isn't Worth As Much As You Think

That is a really good opener to win a popularity contest with sellers, right?  

But it is a situation sellers and their Realtors face daily, and believe me, I had my share of those moments. Excellent advice on how to tackle pricing properly appeared yesterday in the newsletter Realty Times:

Your house is super badass. It's easily the nicest home on the block. Great updates and a corner lot. You're going to make a fortune when you sell. You might even set a new record for the neighborhood.

It's all about making as much as you can, right?

Especially in a Seller's Market. Those two words get everyone that's about to put their house on the market all giddy. But "seller's market" doesn't mean license to be a real estate snob.

Somewhere between what the last people paid for a house like yours and the highest price suggested to you by a REALTOR - that's your sweet spot. But pinpointing it isn't always easy. Here are five tactics that will help.

1. Choose the right agent

The right agent is not necessarily the one that wants to list your home for the most money. In fact, an agent whose recommended list price is significantly higher than the other agents you are interviewing may be a red flag.

"Local agents have an inside track on what local buyers care about and what they will and will not spend. Talk to your agent about it, but don't forget to actually listen to and consider what your agent has to say," said Forbes. "If you don't trust what an agent is telling you about where you should list your home, talk to several agents -- if the consensus is a recommended list price range lower than what you had in mind, that's a sign you should reconsider."

2. Get comps

Comps, otherwise known as comparables, will tell you what other houses are selling for. It will also show you a pattern of sales trends over a period of time. But it can also be dangerous for anyone seeing dollar signs above all else.

If you're tempted to price your home high, check the comps, said Forbes. Active buyers do not "want to overpay for a home, and most will view your home as overpriced and not worth the hassle (or the haggle) if it is out of whack with the recent sales prices of similar homes. Similarly, appraisers will use these numbers when figuring out your home's value. Even if you do get an offer at a higher-than-justified price, if the buyer's appraiser finds that your home is overvalued compared to other nearby recent sales, it can cause major delays in your buyer's mortgage process -- or derail it altogether.

The bottom line:  Heed your agent's advice... he/she will be able to delve deeper into the trends and provide further context around them. Which brings us to:

3. Listen to your agent

You probably already have a good idea of the price you want for your house. But is it based on reality or is it simply a number that sounds good? Perhaps it's what you need to comfortably get out of your house and into something bigger. But that doesn't mean you'll get it.

A local seller not listening to the market for nine (!) years; cs = last sale date

"Here's a real estate fact that every home seller should know: Buyers determine the right price for a property, not sellers," said the Washington Post. "The market price for a home is determined by what an able and willing buyer ultimately pays for it. There are certainly things that homeowners can do to influence buyers' perceptions of their home's value and hence increase the price buyers are willing to pay for it. But, ultimately, the buyers will set the price."


4. Do additional research

In today's day and age, you can easily gather a mountain of information to help you understand the market in general, and, specifically, the market in your neighborhood. Pay special attention to the number of homes on the market in your projected price range. The more inventory, the more competition, the more pressure to make sure your home is priced right.

5. Consider the consequences

Pricing too high is a danger in that a house that sits on the market unsold will eventually have to lower its price. Chasing the market down is not something any seller wants to do. Plus, the longer a house sits on the market, the more momentum it loses from being a new listing. And all of this means one thing: money lost.

"Making a mistake on price can cost sellers thousands of dollars…not by under pricing the value of the home, but by overpricing it," said NH Homes.

Pricing right, or even lower, thereby creating interest (and possibly even a bidding war), is the easiest way to get your home sold. Your fear of leaving a few thousand dollars on the table upfront should pale in comparison to what could happen if you can't sell quickly, or at all, at your "preferred" price.
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What is your experience in pricing a home for sale? I would love to hear your input.

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Article ©Jaymi Naciri for Realty Times, photo illustrations ©tckaiser

Architect Thomas Crowder, 1956 – 2014

Sadly, Thomas Crowder, architect and City Councilman in Raleigh, NC, died on Tuesday.

I had the pleasure to meet Tom during my wife's and my first exploratory visits to Raleigh. He was a very interesting man to talk to, very smart and very much on the ball.

While we were discussing architecture in the Triangle, he proudly gave me his business card and asked if I noticed something?

I said “yes, the spelling”: he had very slyly circumvented some legal naming convention and named his firm “ARCHITEKTUR”, which is the German spelling for Architecture; fitting for a modernist.

Godspeed, Tom, and all the best to your family.

Details on his work on NCMH, the announcement of his passing at the Raleigh News & Observer.

Thinking "Architecture in the Alps ≠ Modern Architecture"? - Surprise!

If you by chance were thinking "Architecture in the Alps ≠ Modern Architecture" - you would be in for a big surprise.

Every time I go to Munich – I just came back – I'm astonished how much modern architecture is put into place in this area, public and private. Actually, I don't stop and document interesting construction often enough. And it pops up not only in Munich, a cosmopolitan city with a metro population of  1.49mm.

No – you see interesting examples of Modernism in small villages in farm areas, which are very much imprinted by typical alpine architecture influenced by functionality (i.e., an integrated barn, roof overhangs to protect stacked firewood from snow, etc).

But perhaps not by accident was this beautiful pre-alpine area (locally referred to as "Das Blaue Land") home to then-radical modernism before: The "Blaue Reiter" school of painters, formed in 1911.

A few examples observed over the last weeks:

(from top: Linde HQ, Pullach; Buchheim museum, Berg; Kindergarden, Feldafing; traditional Bavarian house and modern construction directly opposite, Feldafing; Highschool, Grünwald; Elementary School expansion, Starnberg) Photos: Kaiser

Have you been in the Munich area? Architecturally, what did you notice?

Have a fine Labor Day weekend!

To a nice relaxing Labor Day weekend!

Photo: tckaiser

NC Museum of Art, Raleigh

Classic pose: drawing a Rodin sculpture

On my third visit of the North Carolina Museum of Art in Raleigh last week, I had the chance to see both the new and old building as well as the sculpture garden.

Origins

The NCMA opened in 1956 as the first major museum collection in the country to be formed by State legislation and funding. In 1967, the current site was chosen for a new building, as the museum had outgrown its previous location.

Designed by Edward Durrell Stone of New York and Holloway-Reeves Architects of North Carolina, the building on Blue Ridge Road opened in 1983. Stone used spatial experimentation with pure geometric form for the museum, by using a square as a basic unit and designing the entire site by manipulating the square form.

After Stone's death in 1978, the exterior was changed from white marble to red brick.

In the East Building

Expansion (West Building), east elevation

2010 Expansion

In April 2010 the museum opened the $72m 127,000-square-foot (11,800 m2) West Building, designed by Phifer and Partners. The single-story structure, clad with anodized aluminum panels that are canted back two degrees, and surrounded by sculpture gardens and pools, was created to feature the museum’s permanent collection as well as more than 100 new works of art, acquired on the occasion of the expansion.


Offerings

Erich Heckel, Tiergarten im Herbst

The NCMA offers a collection of art spanning more than 5,000 years from antiquity to the present, an amphitheater for outdoor performances, and a variety of celebrated exhibitions and public programs. It features more than 40 galleries as well as more than a dozen major works of art.

Highlights include a gift of 30 Rodin sculptures and work by artists Roxy Paine, Ursula von Rydingsvard, El Anatsui, Jaume Plensa, Jackie Ferrara, Ellsworth Kelly, and David Park. The project also transformed the older East Building into a center for temporary exhibitions, education and public programs, public events, and administrative functions.

Museum park

The nation’s largest museum park with 164-acres (0.66 km2) includes walking paths, bike trails, ecological projects conceived with artists, and site-specific commissioned works of art in a rolling green landscape.







Impressions

The contrast between old and new (east and west) building is startling. While the expansion shows  the architecture and (mostly) light qualities museum visitors today would expect from contemporary museum design, the old building in its current form (or what was accessible on a recent Sunday afternoon) looks dark, a bit cavernous and somehow forlorn. It reminded me of a favourite tool, forgotten in the shed.

Main lobby; wall-mounted: "Doors of Jerusalem" by Jaume Plensa

What really caught my eye is the very broad palette of art styles and periods at the NCMA – everything from Egyptian art via Rodin sculptures (a lot!) and some lovely Germans (Schmitt-Rottluff, Heckel, Richter), to famous Americans such as Motherwell.

But amidst this plethora of styles and periods, I was not able to recognise a defined focus. Perhaps the focus is "A Bit of Everything" as a general overview; a subject my local friend and I discussed at length but came to no conclusion. An interesting museum nevertheless, and certainly worth visiting.


If you go

Admission to the permanent collections is free, to the special exhibits usually not.

Hours: Tuesday through Sunday. 9:00 - 17:00, Fridays - 21:00, Sundays 10:00 - 17:00. The museum's lovely Iris restaurant is open for lunch Tuesday-Saturday, dinner on Friday, and brunch on Sunday.

2110 Blue Ridge Road, Raleigh, NC 27607, (919) 839-626, http://ncartmuseum.org

At the Iris restaurant; it could be art. Who knows?

S. Florida Homes Sales, 2nd Quarter 2014

It's time for us number-geeks to gather, isn't it? Let's do it:

For the first two quarters of 2014, absolute inventory of Single Family Homes (condos and townhouses are not subject of my data) remained glued to the table at just over 17,000 homes for sale, with a monthly variance of less than 400 units.

But the absorption – the rate of sales – increased every month this year, so much so that relative inventory shrunk from 6.3 months in January to 4.3 in June (relative inventory means: if no homes came to market, in 4.3 months at the current rate there would be nothing left to sell. A balanced market is said to linger around six months).

The blue curve shows the inventory volatility over the last three years very nicely:

SE Florida Single Family Home sales data, June 2011 to June 2014, ©tckaiser

Asking prices went up too, big surprise: from a median $378,000 in January to $398,000 in June, though the movement happened in the first quarter, while the second barely twitched.

Noticeable is an increase in selling prices: from a median of $251,000 in the always-lame-January (only few people think of real estate between Thanksgiving and New Year when January deals are signed) to a much more robust $274,000 in June.

That’s a solid nine percent increase over six months, and seven percent year over year. The culprit: lack of good and affordable inventory and a tighter market at the bottom price end.

If you know and like my “Disconnect” index – what sellers want and buyers are willing to pay:

That one sank. Two percentage points from the first quarter 2014 and a hefty 11 percent from the second quarter 2013. It seems sellers did not over-stretch buyers' willingness and wallet, as both became aware of a more limited selection.

One oddity I can not explain: the median duration of houses on the market - from hitting the MLS to contract – has hardly blinked in the last twelve months.

That goes against instinct when looking at dwindling inventory, but it's reality. Maybe you have an explanation?

Thoughts on Independence Day

On Tuesday, I congratulated my Canadian friends and clients on Confederation Day, Canada's Day of Independence from the British. Today we in the US are celebrating it.

It is a major Holiday, not because all supermarkets are closed, which is unusual enough, but because of the significance for this country, just as Canada Day is for our Canadian friends.

By coincidence or by design, today I also wrote a former prospective client who had acted rather unprofessionally: after a flurry of important emails from him, super-urgent phone calls – often several a day – and a property search that couldn't wait one single second, all of a sudden: nothing. No more response, no "thanks, not interested any more".

Until today, when he asked to be taken off my email list. Which of course I did, but I also added a cool-ish (but polite) comment about his unprofessional behaviour.

Silly of me? Perhaps. Did I write it to make me feel better? Nope.

But I strongly believe one shouldn't offer the other cheek: bad behavior, tolerated, breeds more bad behavior.

Luckily, my business is successful enough to allow me to pick my clients, to voice my opinion, to assert my independence.

What about you – Can you, do you, have you?

Happy Fourth to y'all,

Tobias

Fireworks over Miami Bay, shot from a bobbing sailboat. ©tckaiser