I consider myself an ITP guy (Inside The Perimeter) – while I occasionally assist clients who want to explore areas outside of I-285, my primary focus has always been the intown neighborhoods -(I love selling in Morningside, Virginia Highland and the surrounding neighborhoods). Yes, I’ve sold homes in Alpharetta, Sandy Springs, Dunwoody, Marietta, Roswell, Cascade/Campcreek, Tucker, & Stone Mountain to name a few…..yet nearly 90% of my business is ITP.
A past client asked if I might be able to assist her co-worker who’d recently relocated to D.C. for a new position and was struggling to get her home sold. There are a number of programs out there where employers offer relocation incentives, yet require buyers/sellers to use their “approved” agents in order to qualify. Unfortunately, the relocation companies take a massive percentage of the agents’ commission – therefore you don’t have a great deal of top agents willing to participate in the program.
The seller had a few of the progam affiliated agents come out and give comp’s & suggest list prices in February…..let’s just say the market wasn’t anywhere near the numbers she was quoted – the median suggested value was more than 20% above where she should have been. After the required 90 period the relocation program required her to use their affiliated agents was up she was fed up & ready for a change.
She called me & explained the situation. The seller had a home in Clarkston, just outside of I-285 (not too far from the Dekalb Farmer’s Market)….yet not really a location that had a lot of demand from buyers currently in the market. I told her that I tend to give the brutally honest truth to sellers and don’t always have the information they find comfortable or exciting to hear, yet it is the true market activity & how they chose to act after hearing it is totally up to them. (For most sellers that means staying in their homes right now as they often are inverted or don’t want to lose all of the equity they’ve worked hard to achieve, which is totally understandable considering our current economy).
I developed the comparative market analysis & let the seller know that it would required more than a 20% reduction to even get in the range where buyers would consider her property…..and that wasn’t a guarantee that they’d pay that amount & even more importantly, that the home would actually appraise for that amount due to a lack of recent sales in the area of comparable properties.
My advice was either to rent the property for the foreseeable future or attempt the 20% price reduction and be prepared to cover Buyer Closing Costs up to 3% of sales price & some repairs (typically in the 1st time homebuyer price range it is wise for seller’s to have $1,000-$1,500 set aside following the Buyer’s home inspection for additional repairs – as long as all of the mechanical, electrical, plumbing systems are working properly).
2 Weeks later we had her home repositioned on the market & Buyer showing traffic increased from what she’d seen in the prior listing period. Within 3 weeks we had an offer on her property….we actually ended up with 2 offers on the property (one was too low – which helped reinforce the data I’d sent the now out of state seller as to how the values had significantly dropped in her area – plus there was a new foreclosure listing on her street).
We were able to make one of the offers work – at roughly 98% of list and under contract in less than 30 days. While many would celebrate….I looked at this at yes, the 1st major hurdle – but far from the finish line. We negotiated & addressed repairs following the Buyer’s Inspection, and then I got to what I considered the biggest hurdle….the FHA appraiser.
Since these appraisers can come from anywhere and have no intimate knowledge of the neighborhoods I do my best to protect my clients interest & provide local knowledge to help ensure the appraisers are on the right track (some live in Macon or Acworth and then travel down into the city of Atlanta/metro area and conduct appraisals on areas they truly don’t know well at all – yet they look for comps within a 90 day window, sometime 180 day window in a specific radius of the property & don’t want to make more than a 15% adjustment on values). It’s a tough job – banks are breathing down their necks because they’re scared to have bad notes/artificially inflated values, so the appraisers are looking to minimize risk by scrutinizing values and keeping them as low as possible, which may or may not support the sales price. Considering the amount of work & time they have….I tend to try to assist in the process by providing my CMA of actives & solds along with distances from my listing, dates of sale, and a paragraph explaining the differences we’ve seen from actually having been in the other properties.
I see this portion of the transaction one of the most value-added components of the process I provide to my clients, yet they usually don’t understand the importance of it – considering they see a buyer & themselves having already agreed to a price & are looking forward to a closing date. But believe me, if they suddenly lose an additional 10k-20k or even as much as 100k because an appraisal came in below the agreed upon sales price & the buyers couldn’t get financing for the deal…..they’d be devastated.
We were able to proceed with the closing, ensuring the seller didn’t have to make any more mortgage payments on a now vacant home & allowing her to move on with her life – which now could be focused 100% in the D.C. area.
It’s about being realistic, staying up to date with market data/trends, and being the eyes & ears for your clients – especially when they are no longer in the area. We take an oath as realtors (not as mere licensed agents) to subscribe to a code of ethics & commit with our brokerage agreements to serve the best interest of our clients. I take this responsibility very seriously & believe that when you are given the opportunity to positively impact the lives of others, especially when handling some of the largest financial decisions of their lives, you must live by the Platinum Rule (do onto others as they’d like for you to do on to them) & remember that when you do good, more good will come your way.
If you know someone facing the challenge of selling their home, while encountering challenging market conditions…. definitely if they are relocating out of the Metro-Atlanta area, please let me know & we’ll be happy to assist them during this important transition within their lives.
With recent appearances on Good Morning America, ABC World News, HGTV and in the AJC….I’m glad to know when we consistently deliver a truly value-added service, people take notice & appreciate our efforts. My goal is to positively impact as many lives as possible in the Metro Atlanta area, 1 family at a time.
Call Mike for Results You’ll Like!
Michael Neville
Real Estate Consultant
Keller Williams Realty Atlanta Midtown
404-310-8364
www.LiveInAtlantaGA.com (website)
http://activerain.com/blogs/mpneville (blog)
Comments(1)