Real estate agents who want to be successful in this business can’t hide in their shell or be a “wilting lily” - at least not in Silicon Valley.  Being able to get out there and find new clients with whom to work, encourage offers on listings, and negotiate well for buyers and sellers all require a level of assertiveness.  We may need to work outside of our comfort zone if the situation requires it.

But sometimes real estate sales people can go too far and venture into aggression instead of assertiveness.  The words “pushy” and “salesperson” almost seem to go together at times, don’t they?  (Personally, I hate buying cars because I loathe being on the other end of what feels like pushy sales tactics.)

A few years back, someone I met at an open house said that he didn’t need to like his agent because the agent wasn’t someone he’d want for a friend – it was someone who would push through what needed to be pushed and he didn’t need to be likable.  I found that a really interesting idea, but fundamentally, I disagree with the guy’s premise that successful Realtors basically have to be jerks.  It just isn’t true; in fact, the opposite is the case.

The most successful real estate agents share a few recognizable traits, at least most of the time.  I will list them off as I see them – not every top Realtor will possess all of these habits, skills or traits, but as a group, they emerge as a commonality found among most of them.

Top Silicon Valley real estate agents share these traits (at least most of the time):

1. Prospect or market themselves continuously to attract new business (they cannot simply work on today’s business or tomorrow they will be unemployed).
2. Have systems in place for how to work with buyers, sellers, sales in contract, prospects who are long term, follow up etc. Good systems are crucial.
3. Work well with other agents and consumers – they play fair, communicate well, respond in a timely manner.  They are usually well liked by their colleagues. (This helps you to sell or buy a home – agents want to work with others they can trust to work well and fairly.)
4. Know the contracts and forms and use them appropriately. They explain the contract to their clients so that expectations are in line.  Surprises are bad most of the time and can be avoided if everyone understands exactly what they are agreeing to.  And the contracts we use are clear: if it’s not in writing and agreed to by all parties, it is not a part of the transaction.
5. Present their listings in their best light with enough photos, good descriptions on the MLS and online, make sure the home is staged or at least tidy and decluttered. You won’t find their photgraphs on the Facebook group’s page “Really Bad MLS Photos”.
6. Take care of any mistakes they make to the best of their ability. (Mistakes happen: the question is, how do you address it when they do?)
7. Can be both assertive and pleasant, not rude.  They are mannerly and follow instructions on the MLS when showing homes and abide by their clients wishes as to when and how to be contacted.  They are not afraid to ask tough questions or work around obstacles.
8. They work hard and don’t blame when things go awry.  The go the extra mile – and will even ask if it’s possible to present an offer in person.
9. Are discreet.  They don’t talk about their high profile clients or their business, but know how to keep personal matters (that don’t involve others) personal.

Recently I had a listing in which the MLS clearly stated that showings were by appointment only.  The for sale sign had a rider with the same information on it:  “Appointment Only”.  But because some agents don’t behave, naturally one of them knocked on my clients’ door a couple of hours before an open house and asked to be let in.  The answer was no.  Not only was the answer no, but the seller remembered this guy and later wanted nothing to do with him or his buyers.   His behavior crossed the line.  If you’re rude before you’re in escrow, when you should be trying to make a good impression, what would you be like if my clients accepted your offer?  Thanks but no thanks.

Another story of an agent who went too far:  at an open house of my listing, where there were many buyers and agents circulating through, one real estate licensee loudly called out all of the defects or flaws in the property.  The sales person holding this house open for me said that some  buyers left when they heard him. Didn’t sound like much of an accident.  That kind of nastiness makes it easy for an agent and her or his buyer to be passed over in a multiple offer situation.

A year or two ago, I was holding a listing open with another realty  agent, a friend and colleague of mine.  The open house was packed and there were agents showing the house as well as neighbors and serious buyers all circulating around.  I could just hear the tone of voice a showing agent was using on my colleague when asking her questions.  This real estate licensee sounded like he was being very critical, there was an ugly undertone.  Although it was hard to hear what was said, I could get the vibe – and it wasn’t nice.  Later, this same guy presented one of many, many offers on my listing. He was terribly pushy then – sort of slimey pushy.  I was relieved that he had the worst offer.  If necessary, of course, I could have dealt with him but what a relief to have a much more pleasant person on the other end of the transaction!  My clients were relieved too. In a tie, guess what? The nice agent/buyer(s) usually wins.

It is a huge mistake to think you should hire an aggressive agent, a pushy sales person.  Don’t do it.  Your agent is in many ways you – he or she represents you.  If you want to be perceived as someone nasty, then go ahead.  But you attract more flies with honey than vinegar, as the saying goes.

For further reading:

Do you need to like your real estate agent? Do you need other agents to like yours?

What do Silicon Valley real estate agents do?  (you might be surprised how they spend their time)

How responsive should your real estate agent be?

Silicon Valley Home Buyers: Should You Use a Buyer Broker Agreement?

What is an exclusion in a real estate contract? What is an inclusion? Both of these refer to fixtures at the property which is for sale.

Generally speaking, a fixture is any item affixed or attached to the house, townhouse, condo or property which is installed with the intention that it be there permanently. For example, cabinets in the bathroom, kitchen or elsewhere are fixtures. So are lights mounted from the ceiling, built-in ovens, in-ground (not potted) rose bushes.  The exception to the rule is anything attached solely for earthquake safety.  This would be the case if you have a large hutch which you have bolted to the wall so that it doesn’t topple in the case of a big quake. In Silicon Valley, fixtures are normally included with the sale of the home.

Exclusions refer to fixtures which the seller does not want to include with the sale of the real property (real estate).  For instance, there may be a light fixture in the dining room which is a family heirloom and the seller does not want to leave it with the house.  It would be noted either in the MLS, with a note at the property or mentioned when the buyer’s agent calls the listing agent to ask about offer instructions. Other examples could be a special fireplace screen, curtains in one or more rooms (may match a bedspread or other decor), or even a rose bush in the garden that has sentimental value.

Inclusions refer to personal property (property which is not affixed) which the seller will leave even though it is not required since it’s not attached.  Commonly we see refrigerators, washers and dryers included, even when they are not attached.  Sometimes furniture may be negotiated also, such as patio dining set, a sofa or perhaps a very large dining table that won’t fit into the seller’s new house, but fits where it is perfectly.

It is important to note that if an inclusion is mentioned in the MLS, it still should be written into the purchase agreement if the buyer wants it (and this is written into the contract form as a reminder). Otherwise the seller is free to donate, share or sell those items.

When in doubt as to whether or not something is included or excluded from the sale, always ask before writing or accepting a contract to avoid unhappy surprises or conflicts later!

Real estate professionals are becoming increasingly aware of the need for caution in their line of work.  It is good for our Silicon Valley buyers and sellers to be aware of some of these issues, since it may not be obvious to everyone:

1. Don’t have your first meeting with a stranger at a home for sale, especially if it’s vacant.  It is best for consumers and Realtors to initially meet in a public place, such as the realty office or a coffee house, and for others to know where you are during that meeting.




2. For sellers who are marketing their home for sale without professional representation, be very careful about showing your property to people who call you from an ad or otherwise learn that your home is for sale. A few years back, an elderly woman showing her condo as a “for sale by owner” was attacked and killed in her northwest home by a pretend buyer.  (Real estate licensees know that agents are murdered around the country when alone or sometimes even in pairs, but home buyers and sellers are not usually aware of this risk to our safety.)  Homes which are shown by real estate licensees will usually be on a lock box – you can be gone when the home is shown, and each agent who accesses the key using the box will have his or her information recorded.  Safety is greatly increased. (I have looked but cannot find the link to that story about the older home seller. If any of my readers remember the city or town and can share that info, I’d be most grateful. I think it was in the greater Seattle area where that crime happened.)




3. Similarly, if you have listed your San Jose area home for sale with a broker or agent, buyers should come to view your house through the proper channels (i.e., during an open house or with their agent, who called ahead of time).  Do not open your door and allow entry in by people who simply “pop by” when they saw the sign, whether they are buyers or agents.  If agents, they can pull up your property’s information on the MLS, call and make an appointment.  If you have a lock box, you can perhaps let them enter if the agent is willing to use his or her display key to open the lock box – officially recording the visit with the agent’s ID now known.




4. For buyers who see signs on properties: do not presume that the house is empty and that you can peer into windows or walk around into the back yard of the house. (I have seen people do this and it is creepy at best.)  You don’t know the situation – the house could be for sale but not viewable.  Some homes are offered with the instructions that the home can only be seen once an offer is accepted (“write offer subject to inspection”).  The home could be tenant occupied.  A resident could be ill.  Children could be in the house and if they look up and see a stranger at the window it will scare them badly. Don’t do it.  (Most buyers won’t do this, but I have seen it often enough that it warrants saying.) If you need more information, call your own agent to pull it up.  If you aren’t working with a Realtor, call the listing agent. In all cases, don’t go onto the property except to grab a flier from the box on the sign post.




5. When entering a home that you have scheduled to see, be cautious and enter slowly to avoid surprising anyone or being surprised yourself.  Sometimes sellers forget that you’re coming, have the time mixed up, or someone in the house failed to tell someone else about the appointment.  When I go into a property with my clients or alone, while previewing, I do so slowly.  First I knock and/or ring the doorbell.  I wait. Sometimes people are in the bathroom, have stepped into the yard or can’t respond fast.  Give it a minute.  Then I’ll use the lockbox, and while opening the door and stepping in I’ll call out loudly, “hello! Real estate!” so that anyone in the far reaches of the house can hear me.This is where you’re most likely to encounter a surprise – when you first enter the home.  I’ve seen just about everything, including unclothed people running for cover, couples who were occupied with each other (they knew we were coming right at that moment!), all kinds of things.  Once I had a small child with a baby snake come running at me, pushing his pet into my face.  (Good thing I like animals and didn’t freak out.)   Sometimes sellers are home but don’t answer the door, so as you go through the house you may find them. (I hate that!  They should at least hollar for us to use the lock box.)  I’ve stumbled onto sellers sleeping on a couch, showering (we leave fast) etc.  It’s not good to either suprise sellers or to have them surprise you!




6. Be cautious when trying to locate the correct house, especially in the foothills or mountains where it can be hard to find some addresses due to private roads, unmarked houses etc.  Once I went down the wrong driveway and had a man emerge from his house holding a rifle.  Another time I went down a wrong driveway – should have been the one next door – and the owner drove up behind me and blocked me in such that I had no exit, came over and started hollaring at me in  a very threatening way.  Turns out I needed to be at his sister’s house next door, but the homes were not well marked and I simply had the wrong leg of the road.  He apologised but it was harrowing.  Both of those experiences have made me appreciate cell phones and GPS (both happened in the early to mid 90s). (The listings agents for these homes should have directional arrows and alert the neighbors about properties for sale nearby.)

It’s very important, when buying or selling homes, to keep your wits about you.  Crazy things can happen so pay attention and follow some basic rules of caution for your safety and that of those around you.

Likeability is a subjective term.  Who’s likeable? How important is it? Most of all, how relevant is your Realtor or agent’s likeability to your home buying or selling success in Silicon Valley?

At times I’ve been shocked at what I’ve heard from consumers and industry insiders alike:

“You don’t need your clients to like you.  You need them to respect you.” (As if these were diametrically opposed.) – a real estate trainer & coach

“I didn’t want to hire someone I’d like or who’d be my best friend. I wanted to hire a tough negotiator.” (Again, seeing these as juxtaposed.) – a real estate home seller

Why do some people think that being a good negotiator means that you have to be rough around the edges, a difficult person with whom to get along?  Strong negotiating doesn’t mean being a jerk, or even being aloof.

In many cases, it’s the exact opposite.

Many of the top agents in the San Jose, Los Gatos and Saratoga markets are indeed quite gracious and pleasant.  They are smart and they are driven.  Most are genuinely nice people, while a few have learned that good manners is part of good business.  Yes, there are a few successful ones who don’t match this description – but they are the exception, not the rule.   And in truth, their lack of likeability is inhibiting at least some of their success. If you hire one of them, it may impact yours, too.

An arrogant, rude and nasty agent may find that his or her colleagues are less excited to show his/her listings.  Or that they will be less enthusiastic if he/she brings an offer in on one of theirs.  Conversely, if that agent is well liked (and, of course, well respected) by the real estate community, it’s far more likely that agents will want to have him or her on the other side of a transaction.

Realtors do not like to speak badly of one another. In fact, part of the Realtor code of ethics involves not disparaging the competition.  So you may be challenged to try to figure out, from a distance, whom to avoid. What’s easier might be finding who is liked and respected.  If you are on Facebook or Twitter, you may be able to see positive interactions up close there.  You may also see it while touring open houses should another agent come through with clients.  Agents who are active in the industry, either paid or as volunteers in assisting other agents or the broader real estate community, may be a good pool to draw from also.  Of course, always consider references too.  Real estate transactions can be stressful even under the best of circumstances, so it’s good to hear how your prospective agent does when things get tough.

My advice:  because buying and selling homes is both a business transaction and a big event physically and emotionally, find someone who is knowledgeable, hardworking, ethical and – yes – pleasant. Your real estate sales person represents you.  Be a good negotiator, be tough – but don’t treat people badly in the process.  That part is never necessary and is counter productive in the long run.

Seen on Realtors board tour: Pull out wine rack for under the staircase

Many of our houses in Santa Clara County are ranch style, tract homes which were built from the 1950s to the 1970s (or ’80s). Often they include one coat closet, normally near the entry area of the home, and one linen closet, usually found close to the hall bathroom.  To the surprise of folks relocating to Silicon Valley from colder climates, we don’t have basements in the majority of houses here.

Where does all of our “stuff” go? That’s what these home buyers are wondering. It is really a critical question in smaller homes with fewer, and tinier, closets.

It is not uncommon to see garages in the San Jose area acting as a catch-all for seasonal decorations, old financial documents that can’t yet be shredded, business files, boxes from the last move which haven’t been opened yet, keepsakes and things that the residents haven’t had time to handle yet…for years at a time.  Guilty here also!  We will not be featured on an episode of “Hoarders”, but our garage also needs thinning out.  In this case, I have real estate files going back until 1993.  Rather, I did.  I have been scanning them, saving to both an external hard drive and to CDs, and shredding them.  So far about 10 boxes are gone.  Only a few more to go (I wish!).

Clutter increases stress for most of us.  Home buyers love built ins and see a future with less clutter when viewing cabinetry in home offices, family rooms, hallways, etc.  It’s a great surprise that assures them of better organization and less clutter in that home.

Most houses, townhouses and condos have places where a little more storage can be squeaked out, or even where wasted space was planned in!  This is especially true for structures with attics (sorry, Eichler and mid-century modern home owners). Here are some possibilities to consider in your own home:

• A furnace in a closet inside the home may be able to be relocated to the attic, providing another inside closet
• Water heaters hogging interior closet space could be moved to the garage or a different type of water heater could be installed in the attic.
• When remodeling the kitchen, consider removing soffits and bringing the cabinetry all the way to the ceiling (assuming your kitchen has a normal kitchen height, not vaulted ceilings!).
• Don’t forget the corners in the kitchen!  Often at the bends in a u-shaped kitchen, hard-to-access spaces can be lost. But by inserting a lazy Susan, or at least access from the other side should it face the nook, you will capture some of that back.
• If your house has interior stairs, make sure you are using the “under the staircase” space well.  That area can be more than just one large closet with a hard-to-access area.  Home or interior designers may have great ideas for you.
• Consider adding closet organizers, particularly in bedrooms.  Some master bedroom suites offer only one small closet – it is really critical to get the most use out of that, so including more than a coat hanger rod is important!
• Adding built in cabinetry to garages and interior spaces can be a huge boost to storage space.  Even more so if they include pull-outs rather than just shelves.
• If you’re a business owner, as I am, you may have a lot of paperwork in your garage that you could toss, but are concerned that it might be useful some day.  Scan and shred!  If you are too busy to do it, hire someone. Many photocopy places can handle this task. As your garage thins out, you will feel better and your storage space there can be put to better use – holding the stuff that you really do need to hold onto.
• Outside, consider a small storage shed for gardening tools, patio furniture, etc. A small shed on the side of the house should be unobtrusive but very useful.

Decluttering

Adding storage is great, but the other half of the equation is getting rid of items that aren’t truly needed.  If you are preparing to sell your Silicon Valley home, one of the best things you can do to boost your sales price is to declutter.  After that, you’ve probably heard me say (or seen me write) that a storage pod is a good idea.  I strongly suggest going through the decluttering before the storage, though, or you may actually increase the problem at the new place. It can be hard to find the time to go through boxes of stuff later, especially when you know that really, half of it should have been thrown out prior to the move.

For many home owners in Los Gatos, Saratoga and San Jose, this really is one of the toughest challenges in a move: getting rid of accumulated things, some treasures but many not.  The lighter the load, though, the less it will seem to you and to your home’s prospective buyers, that storage is not really an issue.  For many, senior home sellers especially, it can be a good idea to start thinning out possessions years ahead of time.  A bag a week each to family, friends or a charity and another to the trash or recycling.  After a few months you’ll see a huge difference!

Which is better: buying or selling a home in “fixer upper” condition, or aiming at “turnkey”?   In Silicon Valley today we are experiencing a shortage of good inventory. Home sellers may be tempted to market their home without preparing it well.  Buyers may feel that they will get a better deal if they purchase something that needs some work. What is really in your best interests?

Silicon Valley home buyers decide: bargain price and do the work, or turnkey and pay a premium?

Often it’s not a black and white choice of extremes between a “total fixer” and a “completely remodeled” home, but often there’s a basic stance that Silicon Valley home buyers must take: am I searching for turnkey or something that needs work? And if it needs work, how much am I willing to do?

A deep discount will be had on properties which are “all original”.  The question, though, is whether or not it will be worth the effort and cost to go through the trouble of extensive repairs and thorough remodeling.  Often the biggest projects are more profitably taken over by contractors – and even then it may not be profitable in the long run. Last summer I sold an original condition home to a contractor who remodeled and sold it.  The contractor did a lot of remodeling and sold the property a few months later for about 18% more than he paid for it.  When you consider the costs of buying and selling (8-10%), the cost of the remodeling (probably another 8-10% of the purchase price if you include the value of his labor), I’m not sure he really make much money.  For his sake I hope so.  For consumers, though, not contractors, it’s even harder to break even with huge remodels if you want to sell anytime soon.  What you do, do for the long run and for yourself – not because it will make you money!

At the same time, buyers need to be careful of homes which have been flipped by investors for a quick profit: they may have simply done the most visible work, leaving undone items which still need addressing, such as pipes, foundations, or structural items.

A few questions to ask yourself if you want to do a massive remodeling job (and buy a fixer upper):

• Do I have the time to oversee the work?
• Am I knowledgeable about construction? Or do I have time to research and learn prior to doing it?
• Can I do what I need and still put aside an allowance of 20% for non budgeted surprises?

For most buyers, changing paint, carpet, windows, appliances or counter tops is a big enough assignment. Rearranging floor plans and expanding a house is going to be too much work, cost, liability and stress for most.

Repair and staging advice for Silicon Valley home sellers

For most people who are selling Silicon Valley real estate, the house, townhouse or condo they are about to put on the market is the single largest asset they own. For this reason, maximizing the return on investment is extremely important. Most sellers avow that they want top dollar for their home.  Many, in the next breath, say “I want to sell As Is and I don’t want to fix anything.” Those two, unfortunately, are mutually exclusive.

To get the best price for your property, it needs to be the most attractive to potential buyers for the money (even in a seller’s market).  Often that means not just making the home attractive, with things like fresh carpet and paint (if needed), but worry free.  First time home buyers are especially prone to worrying: worrying about hidden costs, how difficult it will be to fix problems, whether issues will come back once addressed, etc.   A great example of this is water damage.  If a bathroom has water damage, and the seller wants to sell the house As Is, the buyers will be concerned, naturally, that if they complete the sale without a pest clearance they will later find that the entire bathroom needs to be remodeled due to the previously unknown extent of the problem.

One of the most important things that sellers want to understand about home buyers is this: worried buyers pay much less for their homes than do confident buyers.   For this reason, it is often best to get presale inspections and possibly have work done before a buyer ever crosses the threshold.  A super clean, well presented home (appropriately priced) will attract buyers who are confident and in turn will pay more for the home.

For more reading on this topic, please also see these related articles:

Preparing Your Silicon Valley Home to Sell: What Will It Cost?

Should You Repair & Update Your Home to Sell? Or Sell “As Is”?

Preparing Your Silicon Valley Home to Sell and Return on Investment

Want more personalized advice? Call me for a no pressure, no obligation consultation:
Mary Pope-Handy
408 204-7673

Silicon Valley home buyers (and sellers) are faced with a myriad of questions and choices when completing or reviewing residential real estate contracts to purchase the property.  One of them, early on, is whether or not a particular day is chosen for closing escrow or if instead it’s a number of days from contract formation (acceptance) to closing.

Which is better?

The are pros and cons to each approach, of course.  Many buyers want to be able to plan, without any ambiguity, when they will move in to their new home.  (For some this can be a matter of feng shui, astrology or a sense that some days are more fortuitous than others.)  This can work if negotiations are not protracted.

With distressed sales, though – bank owned properties (REOs) and short sales – and sometimes with multiple offers, the negotiations time frame can be hard to predict and if you pick one particular date, you may well have to change it later or find that you don’t really have enough time because a week or more gotten “eaten up” with counter offers, waiting for a bank or seller to respond or other delays. In those cases you may want to have the flexibility of writing in the length of escrow (number of days) rather than picking a certain date.

As always, talk with your professional real estate licensee for guidance as each case may be different.

For several years, we’ve seen declining residential real estate prices in much of Silicon Valley.  In many areas, though, prices are now either flat or bouncing up and down within a small range such that the probable buyer’s value or market value is very close to where it was a year or two ago.  Today’s San Jose Mercury News reports

“In a report to be released Monday, Clear Capital, a real estate valuations company in Truckee, predicts that prices will remain almost flat this year — compared with a 4.7 percent drop in 2011 — in the San Francisco-Oakland-Fremont metropolitan area, including Contra Costa County. Silicon Valley should see a 1.6 percent increase in home prices, compared with a 2.5 percent drop last year, the company said.” (Bolding mine.)

A small, modest increase in pricing is usually healthy for home sales as it gives buyers the confidence needed to finally take the plunge. It’s immensely challenging for people to buy when they believe any product – cards, home appliances or houses – will be cheaper in a day, a week or a month.

Home sellers who have wanted to move up from a starter home to the one they hope to spend decades in have felt somewhat trapped by lack of equity in many cases.  In others, the idea of selling for less than at the peak was so upsetting that they felt terrible about moving ahead prior to a full recovery.  Most now understand that getting back to prices at the peak of the realty market in San Jose and Santa Clara County will take many years.

Some of them are tired of waiting and are electing to forget about the profit they could have had if they’d sold at the peak.  These folks have decided to make the jump now to get on with their lives, despite less equity than hoped for initially, while at least interest rates are so favorable.  (It should be added that the move-up home will now cost less also!)  This can be a very wise decision since buying a house, townhouse or condo is usually not one purchase but two: you’re buying the loan product also and the total cost of home ownership should factor in both the costs over the lifetime of the loan as well as the purchase price.

Have you been “on hold” and “waiting for prices to recover” before moving up?  It could be a long wait.  What else is on hold with it?  Better schools for your kids?  More room for visiting friends & family?  The view you’ve always wanted?

A client of mine said to me the other day, “it’s time for us to ‘bite the bullet’ and make the move“.  They know that they won’t get the price they originally wanted, but instead only what the market will bear.  They want to get on with their lives and quit waiting on the market – which is completely out of their (and my) control.

On the positive side, though, two years ago interest rates were hovering at 5% for a 30 year fixed, conforming rate loan.  Today they are at 3.91%.  The home they want to buy is 3-5% less than it would have been 2-3 years ago.  Prices are lower for selling, but the cost of buying their next place and also the cost of a loan is lower too. The math may work out very much in their favor after all.

Silicon Valley home buyers often state that they want to purchase a house, townhouse or condo which includes these attributes:

• inviting
• spacious, not cramped
• open (open floor plan)
• light, bright & airy – lots of natural sunlight inside
• has a good floor plan
• includes enough storage space
• well cared for (ideally, unless buying distressed)

In a nutshell, buyers want sunny, open, clean, uncluttered feeling spaces.

Rarely do they request cozy (implies small) or private (suggests flag lot or large hedges in the front, blocking view of the street), though most love a private back yard and some buyers really do want privacy in front as well as back (hence the great appeal to those who prefer an Eichler or other mid-century modern style house).  To get you the most money for your real estate sale, though, we don’t want to appeal to the few buyers who want one style; instead, to maximize your return we need to aim the staging at what the majority of buyers (or the most probable buyer for your property) will want.

How can you transform the home you live in to the house or condo you’re selling so that it appeals to these majority of buyers who want “sunny, open, and uncluttered” interiors and un-scary houses or homes?  Here are a few quick tips:

1. First, understand that you are moving from “your home” to a house or townhouse you’re selling – it is an item for sale and the main goal is to maximize what it will sell for. This is an attitude shift but is critical for getting you the best deal for your Silicon Valley property.
2. De-clutter: Anywhere from 1/4 to 1/2 of your belongings will probably need to go, whether to storage, to charity, to a garage sale, to a recycling plant or, all else failing, to the garbage.  A storage pod is a great help – they can take your stuff away and usually deliver it to your new place, if you are not moving too far away.  Most Americans have too much stuff in their homes. It’s fine to live that way but not so good to sell that way. (“The way you live in your home is not the way you sell it.”) Most of the “stuff” will come out of closets, hutches and cabinets but sometimes even walls need to be decluttered too. (Very smart to hire your Realtor BEFORE you do this so that you don’t get rid of the items you need the most and can get good advice on this action.)
3. Light, light and more light!  It’s so important to do everything you can to let the sunshine in from windows (pull curtains back, trim outside landscaping), have extra good interior lighting (add it if need be) and make sure that no room, hallway or area is dark.  Dark homes will truly cost you money!  Whether you need to increase the wattage of your light bulb or add a sun tunnel or two, look at every area of your house or home critically to see if it’s sunny and bright. If not, fix it!
4. Clean and scrub til it’s all shiny, including places where you never really look, like the sliding glass door or window tracks. Dirty homes cause buyers to worry about what is neglected, and worried buyers pay far less for homes.
5. Fix whatever doesn’t work well or is broken. Noisy fan – but it works? It’s usually inexpensive to replace it, so do! Loud fans and small things amiss tell buyers that you are deferring repairs, and they will wonder what else you’re not fixing that they’ll get stuck with, or worse, surprised with! That worry translates into lower offer prices.
6. Do pre-sale inspections. Confident, happy buyers write stronger, higher priced offers and back out of the deal far less often! Their happiness is contagious – you will sell for more and be happy too!
7. Offer and pay for a home warranty for the buyer. The buyers will feel better about paying top dollar when some fear is removed about expenses the first year after closing.
8. Don’t be there during showings. Buyers think it’s creepy if you’re there (sorry, but true) – they cannot talk freely and feel rushed to quit imposing and get out of your house. Plan to be gone!

If you hire a great Realtor to help you with pricing, marketing and negotiating your San Jose or Santa Clara County home for sale, you will have good help in making your property appeal to the largest pool of buyers and thus sell for more. Agents are not all alike, so hire carefully!

I’d love to be your first choice, so please call me, Mary Pope-Handy, for a no pressure, no obligation consultation on selling your home in Los Gatos, Saratoga, Campbell, San Jose are nearby: 408 204-7673 or email me at mary (at) popehandy (dot) com.

Real estate referral fees are often mysterious to folks who are buying and selling homes (whether in Silicon Valley or anywhere else), and there are a lot of misconceptions about them. So I’m going to explain what they are, who can get them,  how it works, and what to “beware of” with them.

What they are: referral fees are a broker-to-broker (agent to agent) payment of money for business that one agent refers to another. For instance, if my friend, a real estate licensee, asks me to help her friend or relative to sell a home in Los Gatos, Saratoga, or San Jose (let’s say she’s in LA), I will pay her a percentage of the sales price (or possibly a fixed dollar amount) because she referred me the business. The amount varies, just like commissions do, but 25% is pretty common. When I was at Windermere, 20% was most common. When I was at Intero, there was no set fee but some agents required 30%. Some relocation firms demand 35% or more….

Relocation companies also vary among themselves in how this works, but basically they charge the agent a fairly high fee (40 – 50% is not unheard of, sometimes more – and the agent’s company often also reduces the “split” between the agent and the company) so that the buyer or seller’s move is underwritten somewhat by the commission dollars. The agent makes a lot less than usual on this deal, but hopefully the client will be happy and refer the agent to others (who will not have a referral fee attached to them).

What about Costco, USAA or others? To work a “referral” deal, they have to be licensed by the department of real estate in the places where they are referring business. Let’s say a big company wants in on this lucrative market. They get a license and offer to “feed” potential clients to hungry agents and in turn charge a set amount, such as 30%, as a “referral fee”. The big company, in turn, tells the potential buyer or seller, “find your agent through us and we’ll get you a rebate (kickback) of XX% or XX dollars!”  So maybe the agent is charged 30% to “find” a client and the client gets 20% back. Guess who gets the rest? Yup, the big company.

A couple of years ago, I had a potential client for buying a Los Gatos home, who’d found an agent through Costco once before, DEMAND a kickback or rebate of my commission when or if she bought a house through me. I told her that I don’t do that (no one referred her to me – she found me because of my Silicon Valley home sellers book and other connections, not because someone else “sold” her to me as a lead). I didn’t mind that she asked, but she got quite huffy about it when I tried explaining how referral fees work, and I realized that this woman just wanted a portion of my income and with her really bad attitude, I didn’t want to work with her.  There are a lot of nice folks buying & selling homes in the San Jose area, so I was OK letting her go.

There are lots of licensed middlemen like House Values, HomeGain and others who likewise collect leads and basically sell them to agents for a fee, whether a percentage at closing or a “per lead” cost. Again, they aggregate “leads” (people inquiring about selling or buying a home), pass the leads to local, San Jose area real estate agents and charge them for the leads, either per each lead, per territory each month, or at a successful closing. So what you may not realize, as a consumer, is that if you get an agent through one of these portals, that agent is probably paying a hefty fee for the pleasure of meeting you. (So if you were hoping for a discounted commission, it will be difficult for the agent to do that.) Also to be noted: many of the contracts between agent and aggregator prohibit them from telling you how much they must pay the referring company. This is particularly true among relocation companies.

As a consumer, is a referred real estate agent better for you or not?

Let’s dig a little deeper:

Are you better off with an agent you get by referral from another licensee or company than you are finding one yourself?  Some buyers and sellers are very cynical and suspicious of referred agents because they know that the referring agent or company is getting paid.  To see if it’s really in your best interest, we need to view the referral types distinctly from one another.

1. Agent to agent referrals

Often agent to agent referrals are excellent because the referring agent hand picks the individual that he or she feels will be your best match.  The agent who gets the referral is normally very grateful for the opportunity and will work hard for you both because he or she wants your repeat business and referrals, but also because of the hope for more future business from the referring agent.  Conversely, the agent who gets the referred business knows that if he or she screws up, there will be lost opportunities on both fronts.

When I make agent to agent referrals, I take it very seriously and do research before deciding not only who’s most knowledgeable but also who I trust to be honest, hardworking and diligent while assisting the client.  A bad referral reflects poorly on me, too, so not only will I make the original introduction, but I’ll check back to make sure all stays on track and that my clients are taken care of from start to finish.

Agent to agent referrals are usually not at a high cost.  Sometimes they are made at a really low cost to the receiving salesperson, and occasionally at no cost at all.  Don’t assume that if your current agent is referring you to someone else that there’s a big payoff happening.  Of all referral categories, in my experience, these are the most trustworthy and are often head & shoulders above picking someone you don’t know (and might not know how to glean on your own).

2. Relocation referrals

Many times, when a company relocates its employees there is a benefits package which requires that you work with a real estate licensee or brokerage which is assigned to you.  Because relo referral fees are so high (50% in many cases), the best agents – the successful ones – won’t do it.  Why work so hard for half the pay?

Sometimes, though, the fees aren’t so high.  And sometimes you may be able to work with anyone you want (and get your benefits if the agent agrees to the fee).  In some cases, there is no fee from the agent at all.  They’re not all alike.

Relo benefits are hugely helpful in making a move, both for assistance on the practical items but also for the cash assistance which is very often involved.  Best if you can find out upfront, before you even start surfing the web about your future home, what the rules of engagement are so that your relocation is as smooth as possible. (Your agent will thank you for it too.)

3. Lead aggregaters

The final category is that of lead aggregaters. These companies have websites which are designed to “capture leads” – that is, you and your contact information – so that they can sell them off to hungry agents who “buy leads”.  Sometimes the cost by the agent or Realtor is per lead, other times it’s a referral fee if a transaction closes, sometimes it’s a monthly fee – or some combination of all three.

Even within this category there are better and worse companies which provide more or less help to the consumer.  Some home buyers will want to use these companies or sites because of a promised rebate or lower selling commission. Just remember that as with other cases discussed above, the more of a discount there is from the agent, very likely the lower the quality of the agent since the best agents don’t have to work for pennies on the dollar – and they won’t.

In order to work for a really low amount of pay, to make a decent living these same agents absolutely must increase their volume and lower what is offered to their customers or clients in terms of time and attention.  This may not be true on every transaction but over time, it will happen because there’s not nearly the profit margin built into the traditional model that the public might think (there’s a lot of hidden work in the real estate business which isn’t obvious to those outside of the industry).

Referrals are very helpful for agents looking to grow their business, whether by relocation companies or via an agent network. If you want to make some money in real estate yourself, get your license and network like mad. You can make a decent amount of money and never have to actually sell a house yourself!

This article originally published by Mary Pope-Handy for this blog in 2008; updated & expanded in 2011.

Whether you’re preparing to sell a home or are in contract to purchase real estate in Silicon Valley, you likely will be faced with the prospect of hiring professionals to inspect your home. This can run hundreds of dollars, a thousand dollars or more. The potential liability, though, could be much higher than the cost of paying the professionals to inspect your home, so you’ll want to hire very carefully.

So, what must you know when selecting inspectors in the San Jose & Santa Clara County area?

First, there are different types of inspectors:

There are inspectors who focus on particular elements of the property, examples being termite or pest inspectors, chimney and masonry inspectors, foundation & drainage engineers, pool inspectors, heating & air conditioning inspectors and more. Generally, these are all licensed by the state of California, and they may perform repairs on the items they find in need of repair.  The two go together – licensing and being allowed to do repairs.

But this is not true for property or home inspectors. There is no license for doing house or condo or townhouse inspections in this state. Is that good or bad? Part of that package is that they can’t do repairs on problems they find. You can see why it’s good to separate finding problems from being paid to fix them. That’s the plus.  There is another side, though.

Finding the Right Home Inspector

The down side to this is that in the San Francisco Bay Area  or anywhere in California, anyone can call herself a home inspector. As with many aspects of real estate, just because it’s legal doesn’t mean it’s ideal.

There are two trade associations or groups (voluntary) for inspectors in California, both of which uphold a high standard of practice. One is CREIA, a state organization, the California Real Estate Inspection Association.

The other is ASHI, the American Society of Home Inspectors, a national group with exceedingly high standards (and two levels of membership, ASHI inspectors and “associates” who are on their way to being ASHI inspectors). ASHI inspectors have a higher standard of practice, are extremely experienced and keep current on the latest practices to provide consumers with the best information available.

My impression is that ASHI is a higher standard than CREIA, but either one would be a minimum pre-requesite for most realty agents.

What else should you be concerned with, as a consumer faced with hiring a home inspector?

• What is the inspector’s scope of the inspection? Usually, it’s limited to the visible areas – but check – it may vary from one inspector to the next. For instance, are sprinklers or fences included, or just items within the walls of the home? Ask. Obviousy, the inspector cannot see between the walls or inside the concrete of the foundation. All inspections are limited. Some inspectors limit a lot!
  
• What is the inspector’s insurance coverage? Ask about malpractice or “errors and ommissions” insurance. Some will limit liability to the cost of the inspection. Others will limit it to $1,000. Inspectors make mistakes, just like the rest of us. What happens if your inspector misses a $5,000 item? Ask.
• How high-tech is your inspector? Does he or she take digital photos to show you the areas you cannot easily see, such as under the house or in the attic? Does the inspector use a moisture meter or other devices to help detect issues that aren’t easily seen?
• How easy is the inspection to read? How comprehensive is it? Some inspectors will not just tell you how things look today, but what the anticipated lifespan is for that item (such as how much longer the roof will last). This can be enormously helpful information to have, but many inspectors don’t include it.
• How quickly will you get your report after the inspection? In real estate transactions, “time is of the essence”. Getting an inspection within 24 hours can be a big plus!

Finally, how do you choose an inspector if you’ve got several names of ASHI or CREIA inspectors who all seem to be knowledgeable, experienced, communicative, and so on? As with many other aspects of real estate, referrals can be invaluable. Ask successful Silicon Valley Realtors whom they use. Ideally, you want to find the inspector that agents say they hire “for everyone”, both buyers and sellers alike. Those are the inspectors that ought to be fair and honest, who don’t miss anything important but who also don’t create panic. Good inspectors can convey why something’s a problem, how it might be addressed, and put everything in context too.

It should be added that some of the other inspectors, those who are licensed to inspect roofs or chimneys or other elements of the home, may work on commission. Ask about this; clearly it’s a conflict of neutrality if the guy looking at your roof is paid more to find more that’s wrong! And again, ask successful, experienced agents for names of reputable inspectors in any of these industries.

Related topics for further reading:

What to consider when buying a hillside home in Silicon Valley

What happens when inspectors disagree about the property?

This house was ‘termited’ four years ago. Do we need to do it again?

Would you recognize signs of subterranean termites if you saw them?

What is fumigation prep work?

Watch for dampwood termites in Silicon Valley!

If a house or other building is going to be fumigated or tented for termites (or other pests), certain things must be done for the tent to go on and to effectively seal the structure.  We call that “fume prep” work or “fumigation prep” work. It is sometimes included in the cost of the fumigation, and sometimes not – so if this work is being done at your property, be sure to ask if it’s part of the bid!  If it’s not included, there are companies that can be hired to do these jobs if you do not want to or cannot do them yourself. (If you need one in Silicon Valley, please email me and I can give you a name or two.)

Anything which obstructs being able to enclose the home or building must be cut back, disconnected or removed.  For instance:

• fences or gates which touch the building must have a few slats or sections removed so the tent can be placed next to the house
• bushes, hedges, trees and other plants which are adjacent to the house must be trimmed back or pulled away as much as possible – at least 12″ from the structure (if trees are touching it, they must be trimmed)
• any other structure such as a trellis or deck must either be included with the fumigation or separated from the house so that a tent can go between it and the house
• downspouts connected to French drains must be disconnected at the ground
• loose gravel, tanbark or mulch needs to be raked back or removed at least 12″
• any stored items up against the building must be removed

Other items which make it hard for the fumigation to happen need to be removed, such as an aerial or antenna on the roof or an awning on the side of the home., a chimney cap, or weather vane.  Solar panels must be drained.

When everything else is done, it’s important to soak the soil around the building (the perimeter) so that it’s really wet going down about 4″ and out from the house or other building about 12″.  The damp soil helps to create a seal so that the fume is effective.

Please note, this list may not include everything required for your specific building!  Your fumigation contractor should provide you a comprehensive list both of what is needed for the fume prep and also what is needed inside the home (food removal, for instance), by way of utilities, accessibility & keys etc..  There’s a lot of paperwork that you will be asked to sign when you hire a fumigator, but don’t just skim and sign: read and make sure you understand everything so that there are no surprises!

Related reading:

Choosing a home inspector in Silicon Valley

How often should you get a termite inspection?

Choosing a termite company (on my Live in Los Gatos blog)

Both buyers and sellers in Silicon Valley find themselves having to compromise in order to purchase or sell homes in today’s market. In a red hot seller’s market, the buyer usually makes most of the concessions. In a deep buyer’s market, that can be said of the sellers. Right now, though, it is fairly balanced in the sense that homes are selling fast – but only if they are priced aggressively. In some areas, such as the Cambrian Park area of San Jose, prices continue to inch downward.  Sellers often feel as though they are compromising left and right before they even get their property on the market! What kind of compromises might you expect when buying or selling a home in Santa Clara County now?

Silicon Valley Home Seller Compromises

Most sellers want to sell for full price and to not have to do any repairs – that is, they want to sell “As Is”.  Unless they get multiple offers, though, often that’s not the case.  Often sellers must compromise on both price and terms, and may find themselves providing a pest clearance or do other repairs in order for the property to sell.  In some cases, though, the compromises are larger still: they may need to pay points for the buyer’s loan, provide credits, re-roof or do other work to make the transaction work. A suggestion for most sellers is to do pre-sale inspections. One of my clients this last year objected, asking why they needed to spend money (the cost of the inspections) to find out that they needed to spend money (the cost of the repairs)?  But in truth, by doing this, the seller can take care of some items up front, create a more secure feeling for the buyers and then maximize the sales price in most cases. It is a compromise, though, to do these inspections upfront. That said, it’s a worthwhile one because normally it will net the sellers more money in the end! A word to the wise: selling As Is often means not getting top dollar for the property (most sellers want Top Dollar with NO WORK – it doesn’t work that way).  To get the most money out of the sale, usually a hoe owner will need to make the property worry proof: do repairs upfront, before a buyer ever even sees it.

Silicon Valley Home Buyer Compromises

Most San Jose area home buyers want to purchase a home for 10-20% less than what the sellers think it’s worth.  The main compromise is on price!  It’s sticker shock every time, but especially for real estate purchasers who are coming from out of the area. Additionally, buyers tend to want homes in turnkey, perfect condition.  That is, they don’t want issues with permits, repairs, health and safety hazards, termites, and so on. They want to move in and “not have to worry” for a few years. So moving from this position to a purchase where they take on some responsibility for repairs or updating is a major concession or compromise right there. A word to the wise for buyers: demanding every little repair and home perfection will not usually work UNLESS you pay “top dollar” for a property. If you want the best price, be prepared to take on some of the responsibility upfront. For buyers and sellers to agree on price and terms it’s going to involve compromises on both sides. With proper planning, though, these compromises will result in a win-win for all.

Homes which are dark inside, or which feel dark to potential buyers, are much more difficult to sell, and virtually always sell for less money than those which are perceived as “light, bright and airy”.  While a property’s owner might love the cozy feeling of dark paneling, deep overhangs and low lighting, it’s not what most buyers want today.  To maximize the amount a house, condo or townhouse in Silicon Valley will sell for, it’s imperative to make it as attractive to buyers as possible.  In many cases, that means it needs to be lightened and brightened to sell for top dollar.

How can a home owner make a house or home be – or seem – more bright?  One of the biggest “offenders” in this area involves windows! Here are a few window-related problems that can make a home feel significantly darker than necessary, together with some potential solutions:

• an interior room with no windows (seen with additions sometimes) or dark hallway

**consider adding a sun tunnel or skylight (as well as ceiling & other lights)

• tinted windows

**remove film, if applicable, or replace with non-tinted windows

• curtains/blinds which obstruct part of the window

**pull back so that 100%, or close to it, of window is visible

• shrubs, and trees covering some of the window

**trim back so the window’s glass panes are 100% visible, if at all possible, to let maximum light in

• deep roof overhang which prevents sunlight from directly entering the home for much of the day

**look into adding skylights over the porch – keep the overhang but allow more light in!

Once you’ve done as much as possible to allow the maximum amount of natural light into the home through the windows, it’s time to tackle other areas where light is either absent, minimal, or otherwise obstructed.

• heavily landscaped yards, especially with many thick, deep trees and/or hillside adjacent

**being close to a hill will cut down on light and can’t be mitigated, but a heavy canopy of shade from thick, tall trees can be addressed with trimming and thinning (possibly topping) the trees. Don’t remove or severely trim – many areas have laws against damaging trees or removing larger ones so check before you do anything.

• lack of ceiling lights inside: many houses lack high lighting and instead rely upon lamps at the coffee table level.  These will not be able to make a room as bright as lights on the ceiling or high on the wall (sconces)

**Adding recessed or other lighting up high can make a huge difference in the amount of light there.

• dark floor coverings and wall coverings – these don’t make a room darker per se but they make buyers feel that the room is heavy and dark

**best to remove dark paneling, wallpaper and carpet and substitute lighter colors instead to create the “light, bright and airy” feeling that buyers strongly prefer

Every home is unique, so hire a great Realtor who can assist you in making your Silicon Valley home as appealing as possible to the largest numbers of buyers so that you can get the best deal when selling your home.

More home selling tips & information

Home sellers: beware over improving your property when preparing to sell

Selling your home in rainy weather

Home selling tips (ValleyOfHeartsDelight.com site)

Free reports about selling (popehandy.com site)

Those of us who sell real estate for a living know that consumers want to hear back from us as soon as possible when they call or email (or text, in some cases).  What’s a realistic turnaround time for the response?

If not with clients or otherwise tied up, many Realtors (yours truly included) will pick up the phone when called during business hours. (Some won’t. Some do time blocking and return calls at set times, such as between 11am and noon and 4 and 5pm. Those who time block in this way will often put a message on their voice mail explaining when they will call back. Hopefully, that works for the caller!)    In general, Realtors and real estate sales people will not take calls or return phone calls while they are with other clients unless there is a really crucial event happening – and if that’s the case, they’ll let the folks they’re with know about it upfront.  Depending on how long the appointment is, then, the return call could be an hour or two or, in the extreme, at the very end of the day (if with relocating clients and doing a crash course in the area that goes 8 hours – it can happen, but is exhausting for all).

Once in awhile, a voice mail or text simply won’t be delivered by the wireless carrier in a timely manner. This is extremely embarassing and upsetting to everyone impacted by it.  So please keep in mind that it’s always possible that your message simply wasn’t delivered.

If something big is going on, check in ahead of time with your Realtor

If there is some momentous event or report looming, talk to your buyer’s or seller’s agent ahead of time to learn his or her schedule and availability.  This is key for reducing everyone’s stress!

Agents do sometimes take time off, too. Communicate with yours to know when he or she is off, and do your best to respect that time. Real estate licensees who get too burned out are less effective in the long run.

In my practice, often I can call back within a few minutes if I am simply on the other line when I miss a call. Most of the time, my appointments (listing or showing homes) last only about 2 hours, so I can get back to callers within 2-3 hours 95% of the time.  On very rare occassions, I’ll have a marathon appointment and be tied up all day.

If your agent is really busy – and we all get at least some spells like this - know that he or she will probably call you back within a couple of hours. If you don’t get a response and it’s some sort of emergency, try texting (many agents now communicate that way – I do) but know that you are probably interrupting so it may not be possible for your agent to call you back immediately.

It’s all about expectations: if you know your agent’s availability, it won’t be frustrating for you or her/him if there’s a small amount of phone tag.

Finally, I should add that the best agents are not available 100% of the time!  This week I learned that in Santa Clara County, 78% Of the agents have sold either no homes or only 1 home this year.  Those agents may be more available – but they may not be the best agent you could hire.  When hiring an agent, do find out how busy he or she is generally. You’ll all be happier to establish realistic expectations upfront.