Our mission at Team Steele San Diego Homes is to not only provide exceptional service but to shatter the negative perception of real estate agents and set a completely new standard for the industry as a whole. One of the ways we like to do this is by offering full transparency in all of our dealings and sharing what we've learned along the way.
As experts in the industry, we get many questions from our clients who trust us with often the biggest investment of their lives. We've put together a list of the top real estate questions we've been asked and answered each one of them for you below.
Whether you're a buyer or a seller, we hope this expert advice guides and clears up any confusion you may have.
How much work do I need to put into my house before putting it on the super-hot San Diego market as of 2019?
When preparing to sell your home, the goal is always to get the most money. For many sellers, this may mean making some improvements.
There is a balance though, as you want to ensure that the time, money, and energy that you are putting into those improvements and renovations are going to get you a return. Sellers often think that they have to do more work than they may need, considering things like huge kitchen and bath remodels. While these add value to a home if done correctly, you may not always get out what you put in.
Some buyers may not like the finishes you put in, and many may be looking for projects themselves, looking to put their own finishing touches on a property–not wanting something that is brand new. Often improvements like a fresh coat of paint (neutral colors), refinishing hardwood floors or replacing worn carpet or laminate, cleaning up the landscaping, and a deep clean with staging and professional photos will go a long way with helping you to get the most bang for your buck.
If you are aware of any issues with critical components of the home such as roof, electrical, HVAC, or plumbing, these are also projects to strongly consider taking care of as it will help you avoid potential headaches and buyers backing out after home inspections.
With all of this in mind, it's important to hire a great real estate agent who will help you to evaluate these potential improvements and advise you on what should be done for a successful and profitable sale.
The first house we ever sold is a perfect example of this. We met the Seller at an open house, and they mentioned "needing" to redo their kitchen before listing their home. Before having them rush in to do that, we were able to stop by and help them evaluate if that was going to be beneficial.
While their kitchen could have used updating and doing the project would have helped them to achieve a higher sales price, it did not make sense for them to do the project from a financial standpoint. Renovated homes in the area were selling around $430,000, and their kitchen was still very functional and clean, just not finished with the trendy modern finishes. While we felt confident that we could sell their home as is for over $400,000. They had quotes from contractors for kitchen renovations that ranged from $20,000-$25,000.
Taking our advice and keeping the property as it was, while doing a few minor touch-ups, decluttering, and staging. We were able to help them sell for $415,000, and they didn't have to invest thousands of dollars on top of dealing with the headache of a remodel.
Adding to the fact they had two young children and dogs, they were happy to avoid a costly remodel and save themselves time, money, and energy.
What's my home worth and how accurate are the Home Valuation ads I keep seeing online?
The real estate search has changed dramatically in recent years with the rise of technology and various online platforms such as Zillow, Redfin, Trulia, and more. Where buyers and sellers used to have to rely solely on real estate agents for access to homes and images, now buyers and sellers have the entire market practically at their fingertips with these online platforms and apps.
Their ability to review photos, sales history, take virtual tours along with access to a plethora of additional information, right from their smartphone. These platforms also often offer home value estimates and "Zestimates" and have become increasingly popular for consumers to gauge the value of their home. While these estimates can be helpful as a starting point, they are not and should not be taken as entirely accurate.
There are many factors that play into determining the value of a home, and a lot of these cannot be evaluated by a computer algorithm, which is what these estimates are based on. They may be able to see that there was a recent sale of a property nearby that has the same amount of bedrooms and baths and similar square footage as your home. But the algorithm cannot determine that the home may have had substantial improvements made to it, that it is located in a more desirable location within the neighborhood, along with many other factors. Features such as views, cul-de-sacs, school districts, floor plans, and layouts, can all have a dramatic effect on the value but are not easily quantifiable to a computer algorithm. In some areas, real estate is hyper-local with values changing dramatically just by which side of the street you may be on. These variances change even more dramatically in higher price point markets.
The CEO of Zillow himself was a perfect example when he sold his Seattle home in 2016. With a Zestimate of "$1,750,000", he eventually sold after multiple price reductions for $1.05 million, 40% less than the estimated home value on his own companies website. He even acknowledged that his property's irregular lot and location on a busy road impacted his sale–a feature that the algorithm did not easily recognize.
Ultimately evaluating all of these factors and coming up with a pricing and marketing strategy that works for your property is what a great agent is there to support you with. It's not in your best interest to hire the agent that just tells you what you want to hear or is willing to price a home based on an unrealistic estimated value. You want to hire and work with someone who knows the market and has a pricing and marketing strategy in place that is going to support a successful and profitable sale of your home.
How do you determine how much my home is worth?
To determine what a home is worth it's essential to look at the complete picture. You may have heard the adage "Location, Location, Location," and that is still the number one driving factor in a property's value. There are many other things to keep in mind, though. Size, number of bedrooms and baths, and finishes are also going to have a large impact on the value of the home along with the overall floor plan. If you have two homes that are comparable in every way, but one has a nice open layout and floorplan that flows and functions nicely, vs. a home that is very chopped up and not very functional. You'll likely see a dramatic difference in their values.
What's the real estate market like right now in San Diego?
The market in San Diego right now is HOT! This is especially true if you are shopping or selling in the lower or median price point. There is simply not enough inventory for the number of buyers looking to purchase. This lack of inventory means that there are often multiple buyers competing against each other for homes. This is especially true for the really great homes that are on the market. Homes that have nice finishes have been well maintained, and are in desirable neighborhoods. Once you get into the higher price points, this demand does shift as there is more inventory available to choose from. This higher-end market is more of a buyer's market, and buyers have the luxury of being more selective. Homes will also tend to stay on the market longer at these higher price points.
How long will it take to sell my house in today's market?
In today's market, if a home is priced well and does not have anything negative impacting the sale, you can expect to be under contract in about two weeks. What are some things that could negatively impact the sale? Features like being located on a busy street, being next to a gas station or similar commercial space that may be seen as less desirable, poor layout and floor plan, can be reasons for a property to sit longer on the market. Overall, price is going to be the biggest factor in how quickly a home will sell.
What should I disclose to potential buyers?
As a seller, you should disclose all known facts about the property. Here in California, there are required disclosures that the Seller must provide to the buyer. These disclosures are essentially a list of questions that must be answered and elaborated on. Should a seller not disclose something that is required and that they have knowledge of, they could put themselves at risk of a lawsuit.
How Important is home staging, and do I really need to hire someone to do it?
The staging of a home is important and can play a key role in whether or not the sale of a home is successful, and the time that it takes for the property to sell.
In preparation for a sale, sellers should make sure that their home is clear of any clutter, put away personal belongings, and arrange the furniture in a functional way that helps to give any potential buyers an idea of how the space can be used.
Many buyers struggle with visualizing and conceptualizing space, especially in vacant homes. Having a few pieces of furniture (but not too many), can help a buyer to wrap their head around the space and get ideas of how they could use it. You ultimately want prospective buyers to be able to visualize themselves in the space using it as their own.
As for hiring a staging company or not, that would depend on the furniture that you have available and the home that you are selling. If you have furniture that matches well with the home and can be arranged in a functional way, you may be able to utilize what you already have.
If you do not have furniture that would work well or the home is vacant and empty, we would strongly suggest considering a staging company. Statistically, homes that are staged sell faster and for more than homes that are not.
Should I be present when buyers view my house?
No. It is not recommended that a seller be present during showings of the home or property. Buyers that are touring want to be able to tour the home and discuss any pros and cons candidly. They do not want to feel as if they are going to offend or upset a seller should they not like certain aspects of the home.
What's the difference between a list price and a sale price?
The list price of a home is the price that the home is being advertised for. The sales price is the price that the home actually sells and closes at.
Should I price my home higher to leave room for negotiations?
This really depends on the property and local market and is something that a great agent can assist you with. In most cases, it is not recommended to overprice a home as more often than not, it will hurt you in the long run.
A better and often more effective strategy is to price the home at market value or even just a bit below. The goal is to get as many prospective buyers looking at the home and through the door. Most buyers fall in love with a home based on emotion, and you ideally want as many of those buyers competing for your property.
A seller will typically see the best result when they receive multiple offers and can get those buyers competing against each other, rather than just negotiating with a single buyer. These resulting bidding wars can often drive the price up over what the property is listed for and get you more than if you had aimed for the lofty price, to begin with.
A home that is overpriced and that is sitting on the market, attracts buyers who are looking for deals and discounts because they see the property as stale or that no one else wants it.
We would say the exception to this would be in the higher end luxury market where prices and value are more subjective. Multi-million dollar properties can have much larger swings in list price and sales price and room for negotiations.
What happens if I'm not happy and want to cancel a contract?
As a buyer, you typically have your contingency periods to investigate the property and ensure that it is what you want to buy and meets your expectations. Should you discover something that you are not happy with, you could choose to cancel or renegotiate. A seller, on the other hand, is contractually obligated to the buyer and can only cancel should the buyer not be upholding their end of the agreed-upon contract. Should a seller cancel anyway, they could be subject to reimbursing the buyer for any costs and fees that they incurred. It's important to consult your real estate agent or real estate attorney before canceling a contract.
Do I need to provide permits or anything from my deck, shed, fencing, ADU, or any other additions?
In most cases, permits are required for work that is done on a property. However, there are many projects and work that are completed without permits. While you can save on time and costs by not pulling permits, you do leave yourself at risk should the city discover anything. We always recommend pulling permits anytime you are adding square footage to a home, a bathroom, or an additional unit.
How do I respond to low ball offers?
A seller can choose to respond to an offer however they would like, if at all. If a low offer comes in, a seller has the option of responding with a counteroffer, or they could choose to ignore the offer altogether.
What are seller concessions?
Seller concessions are when a seller "gives up" something to the buyer. This is typically in the form of a credit or repairs. Ex) Seller offers a $2,500 credit to the buyer for closing costs.
What happens if the appraised value comes in too low?
If an appraisal comes in low, you have a few options as a buyer. You can decide that you no longer want the property and cancel, citing your appraisal contingency. You can try and renegotiate with the Seller, getting them to come down to the appraised value or meeting somewhere in the middle, with the buyer bridging the gap in appraised value and agreed upon purchase price. You can decide that you want the property regardless and come up with the difference in value in cash. Or you can try and fight the appraisal and have the report amended.
What is a sale contingency?
A sale contingency is a sale that is contingent on something else occurring, typically the sale of another property. You will most often see a contingent sale on a seller who is looking to purchase a property, but in order to qualify and be able to purchase, needs to sell another property.
How does the inspection phase work?
The inspection phase, known as your inspection contingency, is your opportunity as a buyer to verify that the property you are purchasing is what you want and meets your expectations. This window is when you would conduct a home inspection, bring out any specialists if needed, review seller disclosures, and essentially look into anything that you would like to regard the property. Should you as a buyer discover anything that you are unhappy with, you have the opportunity to back out or renegotiate.
What are the common closing expenses for home sellers?
Escrow fees. Title Fees. Realtor Commissions and potential reports like Termite, Potential repairs, etc.
Should I include appliances or leave them as negotiable?
We would suggest having appliances be negotiable. Not including them in the sale when you have a buyer that is willing to offer a good price and write a strong offer asking for them, may turn off some buyers and cost you more than the appliances may be worth.
How do you market my home?
When marketing a home, the goal is to get the property in front of the largest audience possible in the hopes of attracting buyers and getting as many as you can through the door. Every property is different, and there is not a one size fits all approach to marketing.
There are a few important general rules when it comes to marketing, though. Pricing is important, and you want to have a good pricing strategy that is going to ensure success. Professional photos are another component that should be used in the sale of most homes.
Depending on the property and price point, you may also want to consider things like virtual reality tours, events, or publications.
Ultimately it's important to partner with an agent who is experienced and knows how to market a property in your market effectively.
Why isn't anyone looking at my home?
There could be many factors to why no one is looking at your home. The first factor in evaluating would be price. If your home is priced too high, it is not going to be attractive to buyers that are in the market when they are comparing them to similarly priced homes that may have more to offer. You also want to evaluate how the home is being marketed. Are the photos nice? Is the home staged well? Are buyers able to find the listing online and does it look better or worse than the other similar properties on the market?
Can you recommend services providers who may be needed throughout the transaction?
A great real estate agent is often very well connected with various service providers and contractors. We would definitely suggest connecting with your agent to see if they have any recommendations prior to hiring anyone for work.
Because of the amount of work that real estate agents do in this space, they may be able to get you discounts and/or make sure that you're working with someone that is going to complete quality work.
That's about it for now! If you have any additional questions we didn't cover in this Q&A please mention them in the comments below and we'll do our best to respond to you directly or in a future Q&A.
Also, if you'd like to work with us, please give us a contact anytime!