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Make an Offer- I'll Consider it- 3 Magic Words

Is there a rule of thumb in the Berkshire Real Estate  market for how much below the asking pricea potential buyer should initially offer for a listing? 10 percent below? 20 percent below?

This seems like an easy question, but unfortunately quick fix answers will  not work in the Williamstown MA real estate market.   The magic words to begin the process of negotiation are “make an offer.” The truth is that there will be number of factors at play you are not aware of , no matter where in Berkshire County or Williamstown  MA the home is located, no matter who the seller is and no matter who the buyer is.  Getting to the bargaining table is a poker game in the beginning.  Throwing down your cards and walking away means you lose without a doubt.  Staying in the game means you may sell your home or buy the one you want for a great price.

For a seller the three magic words are “I’ll Consider it.”    Consideration is the beginning of negotiation.  Negotiation is a poker game taken to the highest level.  Taking a hard line on any offer is unwise as another offer may not appears for many years.  A Williamstown MA seller is competing with thousands of homes suddenly available in the Berkshires.  Historically during the period of 2004-2007 Berkshire County and Williamstown Real Estate were undoubtedly  HOT second home housing markets and Western MA, Berkshire County was the place to be for executives, stockbrokers, and those in the upper income brackets who lived in New York or Boston and summered in the Berkshires.  The Stock Market was hot, the Real Estate Bubble was growing, fixing and flipping properties was a viable career option for college graduates in mid 2000′s.  Wages and bonuses were high and America was coasting along a financial pinnacle path that has since become unsustainable. 

The vital and most important thing to remember is that the simple rules of supply and demand usually prevail. If it’s an attractive Williamstown MA property at a a below market price, there will be competition for the property.  Competition is the Williamstown Ma Home Seller’s BBF (best friend forever).   Pricing a minimum of 10% lower than your neighbors means your property will get rapid attention and probably sell quickly and you will get closer to the initial asking price.

A new home to the Williamstown MA housing market with a price 10% below its Comparative Market Value ( new=on the market for less than two weeks) is likely to get multiple offers if it is attractive and the sellers are willing to entertain any and all offers.  Keep in mind we stated “entertain” which does not mean accept.  This is not the time to take offense at low and outrageous offers.  It is the time to use the three magic words “I’ll consider it.”  

If  the Williamstown MA property has been on the market at the same price for two months or longer, the uninformed buyer’s agent will most likely recommend that an offer of 3-5% below the asking price be offerred.  We recommend to our buyers they consider offering 8 to 10% below asking not unusual for a market where thousands of Berkshire Properties are for sale.   Even if the property is great often we can spend a few hours crunching numbers and recent sales after which we can show hard data supporting a much lower price.  Keep in mind this is the advice a buyer’s agent is giving to their client.  You as a seller now have an insider’s peak into how the offer process works.   

This is the point in the transaction process when the seller’s agent and the seller will be called upon to use all their negotiating and social skills to reel in the buyer to get to the negotiating table.  This is the time for a level head and cool poker face and a willingness to “consider it.”  Keep in mind “consider it” does not mean acceptanceof a ridiculous offer.  “Consider it’  means only that “you will think about it and get back to the potential buyer and their agent”.  Think carefully about what you are willing to give to the buyer in lieu of lowering the price and what you can give to the buyer to make the property worth more to the buyer.  Using a skilled seller representative will be the vital key at this point in the process.  You are fishing for a buyer and you will need all the skill you and your agent possess to land a qualified buyer and then get them to the closing table.

The worst thing that can happen is the buyer will say no to your first counter offer.  The best that can happen is the buyer will negotiate further up than he or she would have liked and you’ll increase your selling margin.  Either way the chances of a sale increase the more negotiating skills the seller’s agent has.   The take away from this conversation if you remember nothing else is to repeat the three magic words before you respond to any offer for your property “I’ll consider it.”  And for any buyer the magic words remain “make an offer.”

Buying a Williamstown Home

Buyers Rule in 2011.  No doubt about it.  So you are considering buying a home in Williamstown?  Would you like to know what we have found in looking back over years of analytics about buyers in the Berkshires?

Who is looking for a home in Williamstown?  Why does Harsch Associates attract more buyers and what are the two most common questions they ask first?  We will be adding charts, data and more information that buyers need to know and that sellers should know.  Keep checking back this week as we add new info everyday.

What are the three largest cities with buyers looking for Berkshire Homes?  According to our analytics of over 1,000,000 hits on our Website the cities are : New York City, Chicopee MA (home of a large server for all of Massachusetts) and Williamstown MA.  The 5 top states sending real estate web searchers to Williamstown are Massachusetts, NY, CT, NJ, and CA. 

We will be adding more information about where your next buyer will most likely come from all week long.  Check back often.

Patch all holes and cracks in walls and ceilings. Check with your local Home Depot or Hardware store for the items needed to make these easy do it yourself repairs.   Inspect every room for spider webs and lint clinging to ceilings.  A simple long handled duster will make short work and give a cheap face lift to an aging room.  Don’t forget to dust the tops of  light fixtures with fans- consider temporarily removing the blades and washing them.

Fix all broken appliances (or replace them with mid-range priced appliances).  White appliances will appeal the most, with black or stainless steel coming in second. Mid-Range Appliances even cheaper appliances will dress up a kitchen more than costly but old, stained and highly used appliances.   If you can’t afford to purchase new appliances think about adding an appliance allowance of cash in your negotiations on final price.

Get the HVAC system checked out by a professional with detailed facts and estimates in writing and cost of repairs if any  (a good bargaining tool in your pocket if they check out in good shape).

Repairing  simple gasket replacements on leaky faucets and using a polish created for bathroom/kitchen plumbing fixtures will go a long way toward making a good bathroom impression.  Anything that is a mirror surface is attractive to buyers if they can see the shine.

If your carpeting is badly stained and worn in places (be brutally honest when you evaluate the condition of your carpet) – replace it with cheap (to save costs) but clean carpeting.  This is a trick that many people who buy homes cheap and sell higher (flipping) use.  Keep in mind that the new buyer can replace the carpet in time if they desire, but carpeting is seen as a costly replacement at the negotiating table.  Be pro-active and get it done first with a cheap carpet, perhaps thick padding and neutral color. Then take your shoes off each time you enter the house until the house is sold to keep that brand new look. 

Remember the Addams Family Home on Television in the late 60′s.  Do you have broken, chipped or cracked windows that painfully remind the neighbors (and any buyers) of  the Addams’ home?  Replace every broken, chipped or cracked window pane now.  Then wash them so that sunlight streams through them.  If you aren’t able to reach them or have a physical injury/disability that prevents climbing on ladders ask someone to help you with this task, be it family, friends or hiring labor for a day to get it done.   Some communities have charitable organizations that will help freshen up a home for elderly or disabled residents.  Check it out.

 What is happening under your roof?  Most of us have no idea.  For this reason have a professional inspect the roof and write you a detailed fact sheet on the condition of the roof.  You can bet the first buyer and every buyer after that will inspect the roof visually first thing as this can be one of the most expensive repairs that any home has.  If you know in advance the roof may be an issue you will have pro-actively established the amount you will allow in the negotiation of the final price.  

Clean and repair all light fixtures so they shine.  Then replace every bulb with a brighter one which provides the full spectrum of light.  Colors will brighten.  Bright is Right when selling a home.

Consider taking down even fairly new drapery which can hide odors and replacing the cloth window treatments with thin white vinyl slat blinds cheaply purchased at a discount store and easily installed with a few tools.  White is always the right color for a buyer.  To a buyer white is like a new canvas upon which the buyer can paint their own picture of home.

Hire a home inspector FIRST (most likely the biggest cost you will face but the one that will give you the most return on your money when the negotiating starts).  If at all possible get a real estate agent to provide you with three different names of local licensed home inspectors used by banks.  When the negotiating starts you will have fixed all of the minor issues with your home and have a price (estimates provided by the inspectors)

to allow when you reach the final negotiations on price.

Neutrality Sells. As a general rule homeowners are shocked by buyers first impression of their home.  The seller associates ” home” with a lifestyle they cherish which may include  family members (kids/parents/friends), pets, vocations/avocations and the many objects they have collected for each unique interest.  It can be slightly “insulting” to hear that a buyer thinks the home has an unpleasant odor, is too cramped without enough open space and that the level of cleanliness isn’t up to standard.

Neutral Colors Can Sell your Home Faster.

Every home has a unique smell of combined foods, pets, furniture, aging building materials, moisture or dampness and neighborhood/urban/country odors common in these locations.   Convincing buyers whose own lifestyle is made up of totally different olfactory and visual experiences to imagine themselves in what is to a buyer a strange environment is a hard sell.   

Home Newsletter free at local businesses in Williamstown Harsch Associates Berkshire Real Estate is and has been your Source for Solutions, Service, and Stability in the Berkshires for 35 years.  Welcome Home to Harsch! Love personality quizzes???  You will absolutely adore the 10 House-onality Quizzes we gathered to help you find the perfect home.  Share our blog page with your friends and then laugh together as you share the results….  House-onality quizzes Spring is here!  March Madness is upon the Berkshires and here at Harsch Associates we are beginning a new feature- Video Blogs with Tips, Topics and Takes on Real Estate in the Berkshires.  Quick and to the point face to face info you can use today.  We call it “In A Real Estate Minute.” The Good, The Bad, and The Ugly of FSBO (for sale by owner) .  Should you try it?  read more Want to watch the video blog instead of reading the story about For Sale By Owner, then watch more Did you know that there are actually FOUR different prices you can put on your home depending on what the appraiser says?  read more Want to watch the video blog instead of reading about the Four Different pricing strategies?  Then watch more Spring is the most active time for listing your property on the market.  We offer 7 fast tips on getting the attention of buyers NOW!  read more Want to watch the video that shares top tips from home appraisers on how to get the attention of buyers?  Then watch more Welcome to Spring and Mud Season in the Berkshires.  We are here to sell your Berkshire Home or represent you as a buyer when you purchase your Berkshire Home. Call us and let us share the unique features we can offer YOU.  413-458-5000     If you no longer wish to receive these messages, please click the appropriate link below: Unsubscribe me from this one Harsch Real Estate e-mail list. Unsubscribe me from ALL Harsch Real Estate e-mail lists.
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Anyone in Williamstown or Berkshire County who expects to collect a fee for selling real estate in Massachusetts MUST be Licensed in Massachusetts.  A large percentage of real estate licensees are members of the National Association of Realtors (registered trademark), the trade organization of the profession.  Only members of the National Association of Realtors and the state and local Boards may participate in Multiple Listing Service and the Information Data Exchange.

Licensees must assist the public in one of the following ways in Massachusetts: Buyer Agency, Seller Agency, or Facilitation.  It is very common for clients to sign a working agreement with a licensed real estate agent and under law, licensed real estate agents must provide a disclosure form to members of the public with whom then intend to work upon first meeting to discuss a property or upon first meeting to discuss creating a working relationship.

Agents or those real estate licensees procurred as Buyer’s agents or Seller’s Agents have a duty of ABSOLUTE faith to the lawful instructions of their Principals (similar to employer in some ways).  The licensee must follow strictly the  guidance of the client and advocate only for the client’s interests above and beyond all others.  Creating an agency relationship with a licensee also creates what is called vicarious liability for the principal (you the client).   You are responsible by virtue of creating an agency relationship for what your Real Estate Agent does on your behalf.  Should your agent inadvertently state a false fact or otherwise perform a misdeed in the transaction then you are responsible for the resulting liability.   You may also be responsible for other agents if your own agent assigns “showings” to another agent in the firm during the time you have agreed to agency representation.   You should read and understand fully any document your agent asks you to sign.  If you are unsure of the liability involved consult with your attorney before signing an agreement.

Facilitation brokerage does not create an “Agency” relationship and thus removes the risk of vicarious liability from the client.   In the facilitation brokerage agreement the Real Estate Agent has a duty to treat both parties (buyer and seller) fairly and equally providing complete disclosure to both parties involved in a real estate transaction.  The information provided to both  parties allows the clients to make decisions based on full and equal disclosure.  The real estate agent acting as a facilitator has the same  legal obligation to the client in regards to trustworthiness, accountability for all funds, and full disclosure of known facts as any other licensee in the State of Massachusetts.

The majority of buyers and sellers want competent assistance with what is a relatively complex transaction of considerable financial importance in their lives.   A seller wants to sell their property for the best price and a buyer wants to buy a property for the best price.   Both the buyer and seller are working toward the same goal.  A facilitation agreement allows full disclosure to both parties of the same information, requires that the facilitator be neutral in the transaction, and that every effort is made to bring all parties to the closing table in a mutually agreed upon and satisfying price for both seller and buyer.   No adversarial activity is required or encouraged in a facilitation transaction, in fact the goal of facilitation is  closing the deal with EVERYONE content that the best outcome has been achieved.

Berkshire Real Estate in the Springtime

Spring has officially sprung and mud season is upon the Berkshires.  Williamstown, Stockbridge, Lenox, Great Barrington,  and the Berkshires in general are thawing and the smell of fresh green is in the air.  Shopping for a new nest is what spring is all about.  Sunshine and warm weather causes buyers to feel that  same longing for a new start.  Traditionally spring has been the peak season for putting a home on the real estate market.  Why sell in the your Berkshires home in the springtime? 

We have seven good reasons why this is the season to sell your Berkshires real estate:

S=  Sprucing up the exterior and increasing curb value is much easier during the spring season when plants begin to sprout, snow has melted and the siding, porches and walkways of the home can be power washed and scrubbed.  Curb appeal is the number one hook to get buyers inside to look at your home.

P= Placing your real estate offering on the MLS and every site where properties are offered before the competition gets into the ballgame.  Get your offering out there early and of course Price based on a the market in your area-  get that comparative market analysis from your agent and hire that real estate appraiser to give you the write up professionally on the current market value of your home.

R= Ready, set, GO!  Spring is the perfect time to increase the square footage perception of your home without spending a dime on construction.  Clean out that garage, basement and attic to give your buyers the impression your home is much larger than it appears from the outside.  Spring cleaning, tag sales and donations to local charities all go together nicely when the weather warms up.

I= Improve your Instant Appeal!   A coat of neutral white paint will go a long way toward making your home appear fresh and inviting.  While you are at it consider replacing that old carpet with some basic neutral color and voila ! Instant appeal!

N= New Buyers.  Buyers have cabin fever from the long winter inside and are ready get out and about into the sunshine.  Make your home the sunniest view on your street by placing some spring time yello pansies or other yellow cool weather plants in hanging pots on the front porch.

G=Great Marketing will sell your home faster than a for sale by owner sign in the front yard.  Choose an agency with local and Internet presence.  When you interview your real estate agents ask about their website, how many hits do they get a week, how many of their buyers are from the surrounding area and how many come from outside of the area.   Ask the agent how they plan to make sure your home gets seen in the most places.  Ask them to take you on a tour of their website and share with your how many homes they have sold in the past two years.

These are just a few reason why spring is a great time to get Berkshire home on the market.  Here at Harsch Associates Berkshire Real Estate we strive to be the top Real Estate Website in Berkshire County.  We attract buyers from New York, and all through New England with some as far away as Los Angeles and Miami.  Harsch is your source for real estate solutions, service and stability in the Berkshires.

Williamstown CMA

A comparative Market Value Analysis or “CMA” in Realtor speak is a Broker price opinion based on the current real estate Market in Williamstown or the  Berkshires or your real estate location.  “Your location” is the key word here.  The same home in Palm Springs Florida may sell for far more than a similar home in Hancock MA.   Location  is everything in the real estate market.  While homes in the Berkshires and Williamstown, Stockbridge, Lenox, and Great Barrington.  Key points to keep in mind when you imagine how much your house is worth are

• How many jobs does your town area offer- right now
• What are the demographics of the community-  young families, retirees, and careerists
• How many homes are on the market right now

What is the least important fact when you imagine how much your home is worth?

• Current listing price of homes in your neighborhood (meaning the how much is the “for sale “amount on homes still for sale- which can be 8-36% higher than what the home will eventually sell for)
• What you paid for your home, what improvements you made when you bought the home

What is the most important piece of information to keep in mind when you imagine how much your home is worth?

• What have homes sold for in your neighborhood within the past 12 months (not in 2007 when real estate experts claim the housing market bubble was a the top of the boom)

The four values that a Broker or professional may discuss with you…

• Market Value- the most probable price that a property should sell for in the current competitive and open market.  Market value depends on what a buyer is willing to pay in the current real estate market.   Suppose you owned a BMW car lot with 15 used BMW vehicles all in excellent condition.  Colors may vary, options may vary and sticker price may vary.  However, the bottom line in sales is what is important to the buyer- If price of the vehicle is the bottom line for the buyer, the cheapest BMW will be snapped up.   If the buyer is insisting on a BMW loaded with options then the vehicle with the most options for a price within reason will sell first.  Bottom line is the buyer will determine which vehicles sell and how quickly they sell.  The same is true of real estate.   The seller of BMWs may want top dollar and that would be possible if the car lot owner had only one BMW and it was the only one in town.  Not true in vehicles and not true in real estate in 2011.
• As-Is Value- no frills included, the property is being sold exactly as it is.  What you see is what you get.  The end.  This price will usually be much lower than the Market value and it may be possible to negotiate it lower.
• As-Repaired Value- This is a tricky one.  The appraiser or broker may place a value on the cost of repairing the issues found during the home inspection.  After the recommended repairs, the house should be in turnkey condition.  Problem with this one is that after you make the improvement the home may still sit on the market for a while.  A good thing about this one is that you can negotiate with the buyer and perhaps lower the price if the buyer will do the repairs themselves.
• Quick-Sale –Value- This value is below the current market value and usually indicates the buyer needs to immediately liquidate the property or the property is in foreclosure.  This value may be considered if the buyer has immediate need of cash, has already purchased another home, or if the buyer has moved to another state and does not want to continue carrying the cost of two homes. 
• Conservative real estate experts estimate that 1% per month of a home’s value is the actual carrying cost for an empty home.  If you home is worth $200,000 then 1% per month translates to expenditures per year of $24,000 per year.  If the home is on the market for 3 years then the owner has lost $72,000 in carrying cost.  Meaning actual value received upon selling for $200,000 minus the $72,000 to hold the home 3 years = $128,000.    That is a 36% loss of value. 

The best advice your agent can give you is to have your home appraised prior to putting it on the market.  The cost can range from $300-$450 and is well worth the time and effort.  The number one reason homes do not sell is that they are overpriced for the current market.    Priced right is half sold!