You Might Adjust for That

You Might Adjust for That

Frank Lucco, SRA, CRPManaging Director

Accurity Qualified Analytics

1004 FORM ADJUSTMENTS

Thinking Outside the Grid

ENERGY EFFICIENCY

Saving Energy: Inside and Out

• Solar panels aren’t always considered the most aesthetically pleasing

• Solar shingles can also be used which have the appearance of standard shingles but function the same as large solar panels

• Spray foam insulation fills cracks and crevices better than traditional fiberglass

Saving Energy: Inside and Out

• Energy-efficient HVAC systems with regular maintenance will help cut down on energy bills

• Smart appliances – fridge, washer, dryer – will help save energy, water, and money

Photovoltaic Panels

• Photovoltaic (PV) systems convert sunlight directly into electricity

• PV systems are most common in Arizona, California, and Hawaii

• Approximately half a million homes use PV systems as a source of power in the U.S., with about 32% of the total PV systems in the U.S. added in 2013

Photovoltaic Panels

According to a December 2013 Lawrence Berkeley National Laboratory study:•$24,705

– Average price increase for homes sold with a typical 3.1-kilowatt PV system

•$5,911– Sale premium for each 1-kilowatt increase in generating

capacity•$2,411

– Sale price decrease each year that a system ages

Light Bulbs

• Described by The Daily Green as “one of the easiest changes someone can make, with some of the quickest payback period and best ROIs.”

• According to HGTV’s “Kitchen Cousins” – “the two biggest savings are thermostats and light bulbs.”

• Adding motion sensors or dimmer switches can also decrease energy expenses

Windows

• Marvin, Anderson, Pella, Gulf Coast - $2,000 each

• No Name - $200 each

SMART HOME

Broadband Speeds

• Young people – this is a make or break feature• Fiber optic, high speed, upload and download

speeds

Technology

• Media• Digital• Remote Control• Kitchen Equipment• Whole House Generator

EXTERNAL INFLUENCES

Nasty Neighbors

• Nasty neighbors can hurt home values by as much as 10%-the New York Times

• A nasty neighbor, cranky neighbor or sloppy neighbor can bring down property values and it tends to be outside of your control

Schools

• Location in a good school district can be a prime factor for families buying a home

• School district can be so important that many families will take out riskier loans or otherwise stretch their financial situation

• Owners may stay in homes long after they’ve outgrown them to stay in desirable districts

Schools

• Sometimes buyers will pay more for a home in a good public school district because it’s seen as offsetting costly private school tuition

• According to a study by Zip Realty best property values often correlate with the best school districts

• Strongest correlation was seen in cities like: Chicago, Denver, Los Angeles, Orlando, Phoenix, Sacramento, San Diego, San Francisco

Spite Houses

Generally built to annoy or as a form of protest

Dating back to the 1700s, reasons for spite houses can include:•Wreak havoc and protest local authorities•Feuding neighbors•Familial strife

Spite Houses

Aesthetic ProtestPurple House, Lubbock, TX

Equality House, Topeka, Kansas

Spite Houses

The Alameda Spite House, Alameda, CA

Skinny House, Boston, MA

Obstruct neighbor’s view

Foreclosures

• Foreclosed properties can sit vacant for extended periods of time, even years

• Sitting vacant, yards become overgrown, houses fall into disrepair or can become inhabited by stray animals or squatters

• If a neighborhood becomes increasingly full of run-down foreclosed properties, the neighborhood can become blighted

Foreclosures: Health Effects

• The stress of going through a foreclosure is self-evident, but what about living next to a foreclosed home?

• A new study by the Harvard Center for Population and Development Studies suggests living adjacent to a foreclosure can elevate blood pressure

• Add another foreclosure within 100 meters and add an additional 1.71 millimeters or mercury in systolic blood pressure

Foreclosures: Health Effects

• The study also suggests not just blood pressure may be impacted, but also increased alcohol consumption and minimal weight gain - typical health effects of stress

• Neighbors can become stressed, worrying that the neighborhood may be in decline

• That stress can also increase when you’re living within the 100 meters and trying to sell your own home

Blight

• Generally characterized by neighborhood, city, or other market area falling into disrepair, decay, or deterioration

• Common in many cities across the country and globally; especially common in areas still suffering the effects of the Great Recession

• Blight is a common problem that may not always have interested parties pursuing solutions

Blight:The Problem

Blight:An Aesthetic Solution

A new company offers a novel solution – life-size, realistic decals of doors and windows that can be adhered to plywood

ECONOMIC INCENTIVES AND DISINCENTIVES

Economic Incentives

• Grants and tax break programs, particularly for energy efficient improvements

• Grants for first-time home buyers and affordable housing candidates

Economic Disincentives

• Increased flood insurance premiums• Restrictions on rebuilding, renovating or

remodeling• Property Taxes

HIGH END HOMES

High End Homes

• A study by Redfin and Grammarly suggests that listings written in complete sentences and without spelling or grammatical errors sell three days faster and are 10% more likely to sell above the list price

• Elsie de Wolfe, credited by some as the inventor of Interior Design as a profession, described moldings, light-openings, door-handles and hinges as “the unconsidered things that make or mar your house.” One could surmise this is particularly true for high end homes.

High End Homes: Over $20 million

• A study by Zillow indicates the median sale-to-list price ratio is 72% for homes listed at

$20 million or more• According to Zillow’s analysis, approximately

50% of the homes demonstrated at least one price change compared to 36% of inexpensive homes

• Quantity and quality of comparable data often leads pricing to be more of a “guessing game”

High End Homes

• Top important luxury features for both luxury home owners and non-luxury home owners are view and a chef's kitchen.

$20 million or more• 40% of luxury homebuyers are willing to go

over their budget as opposed to 29% of non-luxury homebuyers

LISTINGS

Technology

• Smart phone technology has put the power to search, view, and even buy homes, literally in the buyer’s hands

• Instead of pre-recorded virtual tours online, a video call can give a buyer a real-time video tour

Technology

• A study by Realtor.com shows that more than 50% of all listing page views happen on a mobile device

• Users on mobile devices on average submit five times as many inquiries as Web users

What's a word worth?

• According to an article in the Wall Street Journal there is a 1% increase on average, in the sale price when positive opinion words are added to a listing, according to a study:

• Words like beautiful and fabulous can boost the sales price

Selling Turnkey Properties

• According to zip Realty a turnkey sale describes selling a property that doesn't require any major repairs or renovations

• Nationwide, listings billed as turnkey are 3.1% more expensive than listings without the term

Turning off buyers

• Biggest mistake is not getting the home in the best possible condition

• Various odors, outdated fixtures and appliances, displaying personal items and having sellers hang around the house during the showing along with poor curb appeal and clutter can have a disastrous outcome on the potential offers.

Bless Our Happy Home Sale: St. Joseph Statues

• According to an article in the Wall Street Journal from 2009 to 2010, when home prices were stagnant, the number of sales of St. Joseph statues slightly more than doubled

• When home sale prices began to creep back up, St. Joseph statue sales dropped

A Whiff of “Welcome Home"

• Buying real estate involves a lot of factors: location, price, etc., but how about smell?

• Developers are creating custom scents to sell high end luxury condos, this goes well beyond baking fresh cookies or a loaf of bread

• Should there be a scent dispensing machine in your condo project?

Bidding for a House: Strategies That Win

• According to national real estate brokerage Redfin, 44% of winning offers were all cash– making that one of the most successful ways to come out of it ahead of others

• Other successful strategies include waiving appraisals, inspections and submitting a personalized cover letter

Word Play for Agents-WSJ

• Using local terms sells real estate • According to Redfin, local customs are

important, replacing stove with range, powder room with half-bath and study with office can make a big difference if those terms are common and customary for your region

How a Dual Agent Affect’s Sales Price

• Dual agency sales that occur in the first 30 days of a listing contract sell for a roughly 18% premium because agents may be able to more efficiently match the property with the right buyer if they search within their own network

• On the other hand dual agency sales in the last 30 days of a listing contract sell at about 6% discount

The New Old Home

• Psychic comforts of yesterday-selling the new old home

• Selling a new authentic old house can be seen as a psychic comfort of yesterday, a concept of the past that's happier and less disposable than life in 2014. Supposedly, people have this visceral memories of their grandmothers house. Memories are an underrated idea in terms of making people feel comfortable

Staging Your House for a Quick Sale

• According to a real estate agent with Martha Turner Properties, the interior of the home needs to be de-cluttered and re-arranged for maximum space and light. You may need to rearrange furniture and pack up some personal belongings

The Popularity of Trees

• According to a recent article over 5% of current listings in the US are on streets with tree names. Median listing price of homes on Oak Street is $187,000 for Cherry Street is $169,900

• Homes with actual trees can boost the sale price of a property

The Popularity of Trees

• Research done recently found that homes with street trees sold for $7,130 more on average and 1.7 days quicker then houses without trees planted between the sidewalk and the street.

Tricks

• As of May, a Redfin study of 37 major metropolitan markets showed that 58% homes sold above list price when there was a published offer deadline

• The same study also indicated DOM averaged 31 days compared to 61 days on listings without published deadlines

• Deadlines can push buyers who are on the fence or otherwise delaying to make a decision and take action

Pets

• Pet odors are an obvious turn-off, but even just the presence of an animal at a showing can turn away buyers

• For stubborn sellers who do not heed their agent’s advice, it is crucial that the listing provides that an animal is on-site.

• Agents also suggest another reminder at the door or other clearly visible location before a showing

Pets

• Pets are a distraction: from buyers wanting to pet them to being afraid to barking

• Barking, or any loud noises, can impede discussion and viewing making it difficult to focus on the positive aspects of the home

• Remove evidence of pets from the home for best results – from the usual bedding, bowls, and toys to photos and refrigerator magnets

Buyers Personality

• Know the buyer's personality as it can impact the final negotiation and price

• Aggressive-procrastinator-perfectionist-investor

Photos

• Everyone knows a picture is worth a thousand words; this is especially true for home listings

• Brokers may spend hundreds of dollars for high-end photography to set off their listing

• In the hottest markets, where buyers can make offers without even seeing the home, photos become even more important than usual

Photos

• The best photographers make the home look even better in pictures than in person

• Photographers will get the frame just right, avoiding power lines just above the roof for example

• Dusk or twilight shots can be popular favorites, with some photographers calling it “the magic hour”

Photos

• Similar to pets, personal belongings in the home can distract buyers and have them thinking more about the homeowners than the home

• Photographers may add a blue sky in the background if it was cloudy or replace the brown grass with green

• While they often use tricks, it should never rise to deception

VIEWPOINTS