Home > Blogs > Valerie Osterhoudt > Valerie's Blog

IS THERE SOMETHING WRONG WITH THIS STRATEGY????

By Valerie Osterhoudt

Real Estate Agent with Johnson Real Estate, Inc. RES.0761759

April 16, 2009 05:49 AM

This is a rare find in the real estate market today. I have a listing of a condo, that is NOT a short sale, in forecloser, and is priced *AT* market value.

My client has lived here for some time, and just didn't do any updating, but we are doing this for her (Johnson Real Estate, is a full service real estate company), and are getting the place painted throughout to include closets, ceilings, woodwork, walls. Also, new carpeting is going throughout, replacing windows where the seal is broken, and new floors in the kitchen, bath and foyer.

What is not being changed out is the dishwasher and stove. My client feels these are working fine, even if they are older. Plus, the price for the unit takes this into regard. Now, if we changed out these appliances the price would reflect this. So, why would a buyer want a new generic stove/dishwasher put it, that would increase the price? A new stove for say the price of $500 over a course of 30 years could be well over $1,000. Wouldn't it make more sense for the buyer to keep the mortgage low, and choose a stove or dishwasher they wish and not have it wrapped up in the financing? This seems to be a major issue for most of the people looking at this home. Why doesn't their realtor point out the benefits.

Am I looking at this the wrong way?

valerie osterhoudt

Info about the author:

Valerie Osterhoudt is a Cromwell Connecticut Residential Realtor who can assist you with the purchase and/or sale of real estate in the Middlesex County of CT, which includes Rocky Hill, Berlin, Middletown, Wethersfield, Newington, as well as all other surrounding areas. Please visit me at www.CTrealtorMLS.com for all your relocation and/or local needs.

Valerie Osterhoudt, ABR - Johnson Real Estate, Inc. - 860.635.0387 #2 - valerierealtor@sbcglobal.net

Re-Blog

Comments(22)

Comment

Show All Comments

Sort:

Heather Chavez

Second Self Virtual Assistance - Caldwell, ID

Real Estate Virtual, Assistant (928) 692-3235

I agree that the buyer's agent should explain the benefits (how it would actually cost more to purchase it with newer appliances over the long haul) of buying this unit with the older appliances.

Apr 16, 2009 06:30 AM

Jack Gilleland

Home Inspection and Investor Services, Clayton - Clayton, OH

That is strange Valerie. I was beginning to think short sale, foreclosure, tax sale, etc. were the norm.

Apr 16, 2009 07:15 AM

Tammy Lankford,

Lane Realty Eatonton, GA Lake Sinclair, Milledgeville, 706-485-9668 - Eatonton, GA

Broker GA Lake Sinclair/Eatonton/Milledgeville

That is odd. I just did 23 BPOs in one townhouse complex, so sad. I wish you and your seller luck in moving his condo.

Apr 16, 2009 08:54 AM

George Souto

George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT

Your Connecticut Mortgage Expert

Valerie, I think that you are right on in the way you are looking at this. It doesn't make sense, but then again very little seems to make sense these days :) :)

Apr 16, 2009 10:53 AM

Wanda Thomas

Montana Homestead Brokers, Broker, CRS, GRI, SFR, RN - Billings, MT

Billings Montana Real Estate

I think for many people it's still all about how much cash they have to put into the deal. If you're at market and have "competition" in that price range, wouldn't you beat the competition with these upgrades?

Apr 16, 2009 01:06 PM

Kristin Johnston - REALTOR®

RE/MAX Platinum - Waukesha, WI

Giving Back With Each Home Sold!

I agree with you....I don't think that is such a big deal, but then again, if it is in all the comments/feedback, maybe you will have to purchase them. This is a strange, unpredictible market!

Apr 17, 2009 01:35 AM

Debi Ernst

St. Charles County, Missouri - Prudential Alliance Realtors - O'Fallon, MO

GRI, e-PRO, Broker/Sales Associate

Valerie - Unfortunately, in this market, it seems that buyers want a great low price and brand new features...

Apr 17, 2009 05:38 AM

Valerie Osterhoudt

Johnson Real Estate, Inc. - Cromwell, CT

ABR, Cromwell, CT Real Estate ~ 860.883.8889

Sheldon.. I know buyers want EVERYTHING for just about NOTHING right now. What I can't figure out is why they can't see a deal when it is right in front of them.

valerie osterhoudt

Apr 18, 2009 05:33 AM

Valerie Osterhoudt

Johnson Real Estate, Inc. - Cromwell, CT

ABR, Cromwell, CT Real Estate ~ 860.883.8889

Michael.. I know brand new stainless steal appliances would look good in my condo too, but that isn't going to happen either.

valerie osterhoudt

Apr 18, 2009 05:34 AM

Valerie Osterhoudt

Johnson Real Estate, Inc. - Cromwell, CT

ABR, Cromwell, CT Real Estate ~ 860.883.8889

Heather.. everything else is being done to this unit... except for the appliances. Why would a buyer want to spend $15k more (roughly) for the same unit with new appliances when they can choose the ones they wish, and NOT have it wrapped up in their mortgage. This seems to be a no brainer to me.

valerie osterhoudt

Apr 18, 2009 05:36 AM

Valerie Osterhoudt

Johnson Real Estate, Inc. - Cromwell, CT

ABR, Cromwell, CT Real Estate ~ 860.883.8889

Jack.. With all these benefits going for it, why can't buyers see the deal that is right in front of them?

valerie osterhoudt

Apr 18, 2009 05:38 AM

Valerie Osterhoudt

Johnson Real Estate, Inc. - Cromwell, CT

ABR, Cromwell, CT Real Estate ~ 860.883.8889

Tammy, That must be one large complex... 23 units? Wow. There has been a lot of activity on this unit which is a good sign.

valerie osterhoudt

Apr 18, 2009 05:45 AM

Valerie Osterhoudt

Johnson Real Estate, Inc. - Cromwell, CT

ABR, Cromwell, CT Real Estate ~ 860.883.8889

George.. You try to make a deal a win-wn situation for both the buyer & the seller. When something is so easy, why can't everyone grasp this concept? Strange.

valerie osterhoudt

Apr 18, 2009 05:52 AM

Valerie Osterhoudt

Johnson Real Estate, Inc. - Cromwell, CT

ABR, Cromwell, CT Real Estate ~ 860.883.8889

Wanda.. If we put the upgrades into this unit, the price would be the same as the others. Right now this is priced to sell and is a deal to the buyers. Why would they want to spend more money, when everyone is trying to save?

valerie osterhoudt

Apr 18, 2009 05:53 AM

Valerie Osterhoudt

Johnson Real Estate, Inc. - Cromwell, CT

ABR, Cromwell, CT Real Estate ~ 860.883.8889

Kristin.. I have another idea. Maybe we can take the appliances out all together, and lower the price even more. :) The buyers would then have to buy appliances, and would spend more money then what it is priced for right now with working appliances?

valerie osterhoudt

Apr 18, 2009 05:56 AM

Valerie Osterhoudt

Johnson Real Estate, Inc. - Cromwell, CT

ABR, Cromwell, CT Real Estate ~ 860.883.8889

Debi.. The buyers want their cake and eat it too. Sad.. this never happens with anything. You never get 100% of what you are looking for in a job. You never get EVERYTHING you want in a vehicle or for that matter a spouse. Too bad most buyers are not in the *real* world.

I had one buyer that wanted to purchase a $750,000 home for $400,000. Would you sell your home for that amount if you still owed over $700,000 on the mortgage? Buyers need to be educated. It IS a buyers market... but it is NOT a flea market or tag sale.

valerie osterhoudt

Apr 18, 2009 05:59 AM

Debi Ernst

St. Charles County, Missouri - Prudential Alliance Realtors - O'Fallon, MO

GRI, e-PRO, Broker/Sales Associate

Valerie - You're right...It's not a flea market or a tag sale. I guess that's what buyers are thinking it is. :)

Apr 19, 2009 05:53 AM

Valerie Osterhoudt

Johnson Real Estate, Inc. - Cromwell, CT

ABR, Cromwell, CT Real Estate ~ 860.883.8889

Debi.. In life you get what you pay for. If buyers want a deal and end up paying very little for a property it might not be a deal in the long run.

valerie osterhoudt

Apr 19, 2009 06:31 AM

Troy Erickson AZ Realtor (602) 295-6807

HomeSmart - Chandler, AZ

Your Chandler, Ahwatukee, and East Valley Realtor

Valerie - I agree with what you are saying, but you need to keep in mind that in real estate, it doesn't matter what the seller thinks, or what the listing agent thinks, it's all about what the buyer thinks. If buyers want a new/updated unit, then that is what they will purchase, no matter the price; even if it doesn't make any sense.

The fact that your seller thinks the dishwasher and stove are fine, or that you think it's better to have a lower sales price and let the buyer purchase a new dishwasher and stove of their choice, doesn't mean everyone will agree with that. There are a lot of things, and people, that don't make sense in this world, but the objective is to get the unit sold.

I don't know the details about this listing, or how it compares to others, but there are a lot of other factors that could be playing into this as well. Are other units selling? What type of units are selling (3bd, 2bd, size, etc)? Where is this unit located (corner, near heavy traffic area, etc)? Has this unit been staged? Is someone still living in it, or is it vacant? How long has this listing been on the market, and was it painted and fixed prior to listing? How badly does your client want their condo sold? I could go on and on. Anyway, keep your head up, and I am sure you will get it sold.

Apr 20, 2009 05:32 AM

Valerie Osterhoudt

Johnson Real Estate, Inc. - Cromwell, CT

ABR, Cromwell, CT Real Estate ~ 860.883.8889

Troy... All units right now in this complex are not moving. The ones that are 2 bedrooms, like this one are sitting there. These have new and updated bathrooms and kitchens. So buyers is they wish everything updated could go to these units. It just seems that buyers want everything updated at a price that is under market value.

This unit just so you know is NOT in a heavy (no traffic at all) area. It is vacant and stagging is the next step. I don't think this unit will be around much longer with all the interest/traffic that has come through, but one never knows.

valerie osterhoudt

Apr 20, 2009 09:29 AM