How Would You Sell This House?

By
Real Estate Agent with Florida Property Experts

THE Port Orange Real Estate & Community Event Blog. By Lisa C. Hill, "THE SMART CHOICE!"
  dining roomIsn't it amazing that as a REALTOR®, no matter how long you've been in the business, you're constantly encountering new situations in real estate? But there's a good chance that another real estate agent has already experienced a situation that you have not, and vice versa. So this blog post is to ask for advice from other real estate agents who may have already experienced what I did today. Or even if you have not experienced this exact situation, you might have some fabulous ideas and advice. So here's my story and some questions...

Yesterday I got a phone call from a very pleasant man with a unique house to sell, and met with him today. His house is currently listed with another agent so I'm not going to "advertise" the house while it's still listed with the other agent. (And these photos are not of his house) But I am going to describe it since he asked me to help find a buyer, even while it's listed elsewhere. I have no problem with that. I'd love to sell his house!

This is just added! I didn't mention that "Ed" is planning to list his house with another brokerage when it expires. But only if he has good reason to do so. Right now, he's upset because his house has not sold in a year. So when his listing expires, if I can provide him with advice on how I can sell his house, without reducing the price, he will then list the house with me. But he also interviewed other agents. That's why I'm staying on top of this.

When this gentleman, we'll call him Ed, called me, he told me a little bit about his house, including the fact that it had been on the market for a year, and told me the price, and wanted to know what I would do to sell his house. I have to admit that when he told me his neighborhood and price, I immediately thought it was overpriced, (which is what his agent is telling him) and told him I needed to look at the applicable comps, as well as the active listings to determine price. He then told me doorthat he was tired of hearing that because that's what every agent had been saying. His house had a lot more to offer than the other houses!

Right now, I can read your thoughts through your computer and mine! How many times have you heard that one before? But I proceeded to schedule an appointment anyway, then went home to start doing my research.

Today, I had my appointment with "Ed". I have to say, when I saw Ed's house, I totally changed my opinion on his price. Ed's house is worth every penny of what he's asking! I told Ed that one year on the market was the norm in our area, even though business was definitely improving. But when I pulled the recent sales for his neighborhooed, I found that only the houses that had recently sold were the ones in the section with the smaller, cheaper homes. And since his asking price is over $500,000, he's not only in the slower to non-existent sales range, he's also going to have the jumbo loan issue. But I still haven't addressed the real problem. The real problem is Ed's "in-law" apartment. The in-law area of Ed's house is absolutely incredible! It's the part of the house that actually makes Ed's house worth his asking price. But when Ed had his in-law apartment added to his house (at the time the entire house was being built), he "bent" the rules of what is allowed in Port Orange, and in his community. Now, as a result, Ed won't allow the in-law area to be advertised to the fullest extent, which is what is needed to produce the buyer for his house!

I spent 3 hours with Ed! We got along great and I gave him many ideas of things I would do differently that his current agent, had not done at all. Ed told me all the agents he had intereviewed. And I told him that he had honestly managed to find some very good agents. But I also, bluntly told Ed that he was tying our hands behind our backs by not letting us fully advertise the in-law suite. I suggested a few workarounds, but even with the workarounds, the limitations he was putting on us, would make it next to impossible to produce a buyer for his house. I'd like to tell you the suggestions I offered to Ed, but I know that Ed found me here on Active Rain, and I know he found another agent here also *cough: Midori* LOL. I ain't stupid girl. I'm not giving away all my secrets =Phouse

So what I want to know is, if you had the opportunity to list a beautiful house in one of your favorite communities, that was actually worth the price that the seller was asking, but you couldn't advertise the part of the house that made it worth the asking price, what would you do?

  • You're limitations are, you CAN advertise the in-law suite, but you can't include a photo of the kitchen or say that it has a full kitchen, which for the record is fantastic!
  • You can include pictures of the bedroom, bathroom and living room in the in-law apartment, but you can't mention the separate entrance, or the fact that in the 3 car garage, there is a full dividing wall (without permits pulled) that separates the 2 car side from the 3rd car portion.
  • You also can't mention the fact there is a private entrance from the 3rd car portion of the garage, directly into the in-law apartment.

staircaseBear in mind, this can only function as an in-law suite, or possibly an area for your teen or young adult children. It definitely cannot be an apartment that you can rent out! So even if we could photograph and advertise all the features of the in-law suite, it must be clear that it cannot be rented out, due to city codes and the neighborhood HOA. But most people looking in this neighborhood will already know that, so don't get hung up there.

After all that, we still have to get past the jumbo loan price range, as well as the fact that there are very few houses in this price range that have sold this year at all. But it's my belief that those are hurdles that can be overcome, once we find a way draw in the buyers that are actually looking for a home with an "in-law apartment/long-term, comfortable, private area for other family members", given the constraints upon which "Ed" has insisted.

So what are your thoughts? Any ideas? Help me out here. I promised Ed (and his lovely wife: I met her just before I left) that I would be brainstorming for him. And I'll probably e-mail a link to this post to him. So what would you like to tell Ed?

And if you're a potential buyer for a house of this nature, please contact me today. I promised Ed that although I can't advertise his property while it's listed with another agent, I would still try to find a buyer. After all, that's the reason we have an MLS, and commissions that are shared. We all work together for the benefit of the client. And if you're interested in any type of real estate in Port Orange FL, or any of the nearby cities, make a Smart Choice and contact Lisa C. Hill with Adams Cameron & Co., REALTORS®.

View Port Orange and Daytona Beach area real estate MLS listings here

View Port Orange and Daytona Beach area real estate MLS listing videos here

Lisa Hill real estate agent

list real estate with lisa hill and adams cameron realtors and get it sold

 

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Rainmaker
145,362
Barbara Carter
C21 Alliance Realty Group - New Paltz, NY
Serving Your Real Estate Needs in the Hudson Valle

Lisa- What a challenge! I think the suggestions in the comments have been great. I think the Brokers luncheon would be a great idea- I would try to incorporate the ideas and have the mortgage people available at the same time- The problem though is that there is another agent listing it at this time- Your hands are really tied. Good luck maybe when the listing expires you can put all these ideas to work for you!

Sep 03, 2008 10:13 PM #7
Rainmaker
363,451
Susie Blackmon
Ocala, FL
Ocala, Horses, Western Wear, Horse Farms, Marketing

Hmmmm, there are great suggestions here but all of this makes me nervous. 

Sep 03, 2008 11:03 PM #8
Rainmaker
595,563
Lisa Hill
Florida Property Experts - Daytona Beach, FL
Daytona Beach Real Estate

Susie- Read the section I just added.

Midori- "Ed" told me he met with Susan =P

Lynda- "Ed" spoke with city officials and was told it was the stove and microwave that made the in-law suite an apartment. So he won't allow any photos of the fabulous kitchen in the in-law apartment. He also has a couple of other things that are definite code violations, but are done VERY well, and make the house an incredible buy for buyers who need a separate living space that will not be actually rented out.

Jason- We discussed the bonus, but first of all, I'm not a fan of them. Our agents don't look at anything but the commission, and "Ed" didn't realize that a bonus had to go through the broker and be split with the broker. He wanted the bonus to go directly to the agent. He was shocked when I told him that was actually a felony.

Sherry- I know the jumbo will be a problem, but in order for me to get this listing, I have to convince "Ed" of how I'm going to produce a buyer IE what I'll do differently than his current agent... The listing will expire soon.

Thesa- The buyer doesn't want to get caught with what he did because he doesn't want to have to tear out the things that don't belong. That's what would happen if the city found out. I have a few ideas, but he is adamant about not actually showing the entire in-law area.

Sherry & Barbara- I like the idea of inviting people to see the "secrets". But "Ed" doesn't even want an open house because he's afraid of the neighbors finding out what he has inside. But we did discuss some possible variations that involved prequalifying buyers and having their names on a list before they could enter the "closed, open house" *sigh*.

Sep 04, 2008 01:03 AM #9
Rainer
42,659
Mandi Perkins
Pioneer Title Agency - Pinetop Lakeside, AZ

I think an "open house" for agents only would be something.....he will allow other agents just not neighbors right? A drawing for a gas card & some food always works well in our area. Also can you call it "privacy quarters"? It sounds like a nice private place for the in-laws or teens to go.

Sep 04, 2008 03:28 AM #10
Ambassador
688,047
Ann Allen Hoover
RE/MAX Advantage South - Hoover, AL
CDPE SRES ASP e-PRO Realtor - Homes for Sale - AL

Hi Lisa! I thought the open house idea was your best bet, but he doesn't even want that......he really has your hands tied.  Good luck!

Ann Allen Birmingham Realtor

Sep 04, 2008 03:32 AM #11
Rainer
195,296
Elizabeth Nieves
The Elizabeth Nieves Realty Group - Durham, NC
Bilingual Raleigh - Durham North Carolina Real Estate Team

MAN...my first thought was to focus on the benefit to a large family...or family with the need for a separate area for teens, nanny or even home office. Then, I got to that part in your post. PUT IT OUT THERE...the best way you can. Don't emphasize the parts you cannot...but put it out there! Someone will see the pictures and fall in love. It is a gorgeous home. Good luck with it, my friend! GBU!

Sep 04, 2008 04:00 AM #12
Rainer
18,480
Sweet Viscape
Arlington, VA

Hi Lisa:

That is an interesting dilemna.  I wouldn't know what to do either.

I hope you figure out that situation.  Thanks for the great post

Misty

www.viscape.com

Viscape's Web 2.0 technology will make other vacation sites obsolete,     

....It will drive leads to you for FREE!!

Sep 04, 2008 04:58 AM #13
Rainer
7,117
Sheila Santini
Waterfront and Boaters paradise Realtor! - Tarpon Springs, FL
GRI

Ed screwed up,  and regardless of you changing your mind of the homes value after seeing it it is non-conforming.  and you will have difficulties getting an appraisal to support the price you and he feel it could command. Also insuring it for what it is.  Ed has two choices, reverse permit the addition, or scrap it from the value!

His need to circumvent paying for permits and the additional taxes will cost him on perceived re-sale, save a penny loose a pound.

Sep 04, 2008 05:28 AM #14
Rainmaker
595,563
Lisa Hill
Florida Property Experts - Daytona Beach, FL
Daytona Beach Real Estate

Ann- I think I have a workaround on the open house part =)

Misty- Thanks

Sheila- The addition itself is not non-conformng. Only a couple of parts are. And I don't believe his concern is with paying for back-permits. His conern is with being forced to change something that is truly unique and is actually going to be a huge appeal to the right buyer.

Sep 04, 2008 11:38 PM #16
Rainmaker
1,561,974
Carla Muss-Jacobs, RETIRED
RETIRED / State License is Inactive - Portland, OR

In the year's time that it has been on the market, and with the great length Ed seems to be making to avoid something . . . it's not as if he has the Tell Tale Heart boarded up within the walls.  Get an architect out there and get some solid advice on what is going to happen when he goes for the permits.  That alone, e.g., not having something permitted, would irk my buyers.  It doesn't matter how beautiful, charming . . . and secret . . . the room, area is.  It's going to be the same "issues" for the new folks when they get ready to sell.  Do you have any type of "grandfather" codes which allow for permits on the pre-existing? 

If the minor changes were made during the home's construction, there was a Permit of Final Occupancy (Occupancy Permit) that was issued -- had to have been issued.   Pull the Occupancy Permit, take it BACK to ED and show him that on such-and-such date his house was approved for occupancy . . . and, as such his property has been permitted to be occupied.  End of Story.  Market away!!

Plus, you're a real estate agent, NOT a code specialist.  This is something that, to me, really does go outside our purview.  But, many people turn to us for our knowledge, even in areas where we might not have knowledge, and/or are not required to have knowledge.  Whoever DOES have this code knowledge . . . get them in there and maybe they can explain to ED he's really making a mountain out of a molehill. 

He's got to be a little more transparent with his property, because the way he's acting, he will scare off any buyer who might have interest.

Sep 07, 2008 08:11 PM #17
Rainmaker
160,778
Retired Notworking
Tallahassee, FL

This one seems like a real problem even if it is lovely. I agree with the comment above that it will also be a problem the next owner when they try to sell. I think he should drop the price and can't wait to read the next installment.

Sep 07, 2008 11:15 PM #18
Rainer
304,164
Cynthia Tilghman, Realtor® Onslow County NC Home Specialist
Kingsbridge Realty, Inc - Hubert, NC

Hi Lisa,
Would the city really make him tear it out if they find out?  In our area, they would make him get the permits that he did not get and fine him and that would be that.  Sure would be worth paying if that would release him from the "bind" he finds himself in and puts his agent in.

Sep 07, 2008 11:53 PM #19
Rainer
225,598
Diane Bell, Hilton Head Real Estate, Bluffton
Charter 1 Real Estate, Hilton Head, Bluffton, SC - Hilton Head Island, SC

This would be a mighty challenge, I'm afraid.  Your hands are tied as to marketing the home. Plus there's the ethical considerations to deal with.  Do you REALLY think you can get it marketed and closed?  That's the question you need to ask yourself as you don't want to spend 6 or more months in futility.

Sep 08, 2008 12:22 AM #20
Rainmaker
545,070
Karen Rice
Davis R. Chant, REALTORS - Hawley, PA
Northeast PA & Lake Wallenpaupack Home Sales

I'm wondering if this non-permitted work is going to come back and bite him in the end anyway - this goes to show that it's not a good idea to "bend the rules" no matter how attractive it seems.

I think I would even pass on this listing - it sounds like a nightmare to me.  But maybe I'm just chicken.  LOL

Sep 08, 2008 12:59 AM #21
Rainer
31,524
JoEllen Stranger-Thorsen
Eustis, FL
Lake County, FL

I would tell ED he needs to go down to code enforcement and get the permitting issue resolved. I believe it will actually save him money down the line. Mortgage people might want to chime in here regarding financing a home with permit issues as these issues must be disclosed. I find the rare buyer who wants to inherit code enforcement issues.

That being said, I personally would market the in-law suite with disclosure that some elements are not permitted or may not be to code.

Sep 08, 2008 01:17 AM #22
Ambassador
894,582
Janna Scharf
Keller Williams Realty Coeur d'Alene - Coeur d'Alene, ID
Coeur d'Alene Idaho Real Estate Expert

I agree with JoEllen, resolve the permitting issues.  In any event they need to be disclosed to a potential buyer.  Sore really good ideas here, thanks everyone.

Sep 08, 2008 05:23 AM #23
Rainmaker
595,563
Lisa Hill
Florida Property Experts - Daytona Beach, FL
Daytona Beach Real Estate

Carla- I think you win for the comment with the best advice on most of the issues. In actuality, there are only a couple of things that violate the city Codes and HOA rules. And it's possible that a buyer would have no problem removing one of them which is the extra wall in the garage. That part was added after the fact.

Sep 08, 2008 02:21 PM #24
Rainmaker
289,221
Pippa Mac
Chevaux Group Realtor, The Woodlands and Spring - The Woodlands, TX
The Woodlands TX Real Estate

Can you show pictures of it??

Sep 09, 2008 10:08 AM #25
Rainmaker
595,563
Lisa Hill
Florida Property Experts - Daytona Beach, FL
Daytona Beach Real Estate

Pippa- It's not my listing, so no I can't show the photos. There's an update to this post that explains in further detail =)

Sep 09, 2008 10:12 AM #26
Rainmaker
76,503
Natalie Langford
Realty Negotiations - Winchester, VA
Winchester, VA Real Estate

Interesting challenge.  I can't add to this conversation as you've had some great advice already.  Looking forward to seeing you get the listing!

Sep 10, 2008 02:21 PM #27
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