From Listed to SOLD - How to Sell Those Listings You Work So Hard to Get!

Don't know about the rest of the crowd but on first contact I disclose anything I know about the property.

Good question Jennifer.  Anything not obvious really needs to be disclosed.  And, these obvious problems, may need to be evaluated on a case by case basis.  Like you mention, one will need to evaluate who the potential buyer will be and the presentation/listing should be geared to them.

This is a great question...of course we all disclose on the seller's disclosure but right there in the MLS?  The only thing I've disclosed is "corner lot" that I can recall.  I went on a listing appt last night...beautiful home on a cul-de-sac...got inside and heard traffic...road behind their house.  I won't put that in the MLS though...so I guess my answer is probably no...hoping like you did that the amentities of the house offset the noise factor.

Gabe - yeah, it's the obvious problems I'm referring to here, and perhaps "disclose" is the wrong word. I agree with you that we should evaluate who the buyer is for the property with the deficiency and direct our marketing to that buyer...

Cindy - I'll withhold my opinion on the matter til later, but I'll be interested to hear how it goes with your noise-affected listing!

I would disclose in the agent remarks (available in our MLS) that the home had structural issue and would need major work.  Then I'd gear my advertising towards contractors and FHA203K buyers.

Cindy - since many buyers find the listings they want to see from the Internet and then tell their agents about them - how would you "gear your advertising" toward investor-type clients? That's what I'm most curious about - if your MLS description talks about how cute the house is, but it's only in the Broker remarks that you mention the issues, wouldn't Internet shoppers only see the public remarks?

This is a very good question. I think I would get a contractor out there and/or a structural engineer to evaluate the problem and what it would cost to fix. With that information I would then add to the comments something like this...this sweet little Tudor with all the right fixtures and features you will love has one last detail needed done to make it absolutley perfect. Information at the property etc etc.  

Another point to remember is that the sellers also look up their home online.  Most times they will complain if they feel the home is not presented in its best light. 

I like Martha's solution:  Include a sentence saying "Disclosures available at the property"  or "Structural engineer's report available at property"  something to put the buyer on notice that there are issues ... but not to scare them off from even wanting to look at the place...

Martha - that's exactly what I would do, too. Especially with structural issues - buyers and agents almost always overestimate what it will cost to fix them. And shoot, maybe the seller will decide to fix it which would be the best course of action by far.

Cheryl - I would get my seller's buy-in before going live - I always do that anyway, but especially in this situation. If I choose to be upfront about the deficiency, I'd explain why I feel it's best to do so (but I'll refrain from saying more til I get more of y'all's thoughts!)

I think there are a lot of ways to get the point across - highlight the positive points as well as comment on the obvious flaws - better to be upfront than oversell and underdeliver.  After the "pottery barn" type comments - positive - weave in something like "Diamond in the rough, just needs a little polishing..." or "95% Pottery Barn, 5% "something clever" here (sorry, I am fresh out of clever this morning) then maybe a specific word or two about the deficiency. 

Get a conctractor out to make it "less scary" and have the factual info available, but I do believe the best approach is to give prospective buyers a heads up as to possible problems because it changes who comes and looks. 

I am with Cindy Jones above.  I would mention it in the agent remarks.  This way the agent with the buyer knows the deal before hand.  Hope the home finally sold Jennifer :)!

Susan - that's my opinion (imagine that, we agree!) - that it's better to underpromise and give realistic expectations rather than the opposite. In my experience, buyers who feel "misled" by MLS descriptions usually get mad at the house, but buyers who are expecting "the worst" often are pleasantly surprised.

Brenda - I think it should definitely go in the agent remarks; I just wonder if the buyer (who is searching online or going thru listings his agent sends him) should be "warned" instead of putting that responsibility on the buyer's agent.

The other thing I wonder about in this scenario is if the buyer agent doesn't see the broker remarks (for whatever reason) and shows the house - and then looks bad in front of her "pottery barn" buyer, the agent's going to be annoyed with me as well for making her look bad, KWIM?

I feel it is in the seller's best interest to advertise the home to the public in its most positive light. The broker's remarks (in our MLS area) are for the "203k project" and "see uploaded docs for quotes". When I'm working with buyers, I ALWAYS read the broker's remarks, and the uploaded docs, if there are obvious red flags (priced way below market value, short sale, REO). As a buyer's agent, it's our job to then educate our client. I have sold houses that I thought would NEVER sell with "obvious deficiencies". But the buyers who bought them? They fell in love...warts and all.

Sue - you are definitely the queen of selling difficult properties! You have the magic touch to make buyers fall in love "in spite of..." whatever!

I think it depends on what the 'defect' is. In your case, I'd put it in the remarks because you'd be looking for a whole different buyer. With power lines or anything that wouldn't change who your potential buyer fundamentally is, I wouldn't give people a reason to eliminate the listing without at least taking a closer look, especially if it's well priced.

I think mentioning it in the agents remarks, and suggestiong something like FHA 203k Financing and even having estimates to "cure" the problem would all be important, and helpful in selling a home with problems.

What a great question and  If this is a material defect issue I would disclose it in internal remarks.  Smart/Savvy agents would know what to do with situation like these. If the concerns about highway or other issue I will let the buyer come by and see it for them self.

Jennifer:  A year ago I would have answered not to disclose on the listing but today I am sure that, as in your post, disclosing the issue even in the agents' only remarks helps bring in the right type of Buyer. 

Might as well disclose the problem up front - that way, the fewer folks who do come have already factored in the problem & feel they can handle it.

I think you have to try to bring in the right type of buyer so disclose it.  The person who is not scared away is the person who will be buying the house.  If marketed correctly a home like that will never get that many showings.

I remember going to a brokers open house where one side of the house sloped and the master bedroom carpet was WET. Because the agents were all friends of the listing agent, I think, NO ONE SAID ANYTHING. Much better if it had been addressed with "it will take about $10,000 to jack it up" or whatever. That was a couple of years ago and the home still has not sold and dropped in price by HALF. So disclose.

Jennifer, probably best to have a structural engineer evaluate and include his remarks in with your listing data. 

better safe than sorry, mention it in the confidential remarks section so that the buyer's agent can prep them before seeing it. 

They are going to find out about the OBVIOUS eventually. You can't change power lines or a sinking foundation or a location just don't over advertise the weaknesses. Address it with words face to face and price adjustments.

If the seller is willing to get a structural report on the home, then you really have something to disclose. While people love surprises on Christmas, they are not so excited about them while looking at homes.

I'm guessing you marketed it to someone who had the capacity to fix the home to its proper standards and that buyer knew it was a jewel...

Jennifer,

I had a house that was somewhat like that. I was able to sell it to a 100 year old man who said it would still be leaning after he had becoem part of the carbon cycle.

This post reminds me of a recent conversation we had in the office.... Wouldn't it be fun to write remarks that REALLY described the home...?! Think of the inappropriate fun we could have!! LOL! OK... unprofessional but fun.  :-)

Jennifer - While I am not a Realtor/agent listing and showing property, I can tell you what my borrowers say and think about listing agents who try to put lipstick on a pig with their deceptive MLS descriptions. 

While I can't speak for all buyers, I know for a fact that most of my buyers spend way too much time looking at properties based on misleading MLS descriptions.  If MLS descriptions were more truthful and accurate, they could spend their time looking at more appropriate properties.

On another note, my 203k buyers are specifically looking for fixers and wouldn't waste their time looking at some cute, sweet little listing.  But then again, what do I know, I'm just an MLO and this is just my personal opinion based on the things I hear from my borrowers about this issue.

I'm with Cindy - You might scare away a buyer for whom that property would be perfect.  But I see your point about the Pottery Barn buyer.  Great post. Lurking for more postings and feed back.

My commercial manager is always saying "who is your target audience and who is the best buyer for this property?" This goes along with what is the highest and best use? If the home you are listing is best suited for the investment crowd then market the listing to them.

Jennifer,

I list most like this "As-Is" in the MLS, which gives an idea of there are issues. In Agent remarks, I might be more specific.

Thanks for all the feedback! And Irene - I love your "as-is" suggestion in the public remarks - it definitely puts the buyer on notice without taking up a ton of room in that precious comments section.

My concern with leaving the onus on the agent to warn or filter the listing from buyers is 1) if the agent somehow doesn't read the broker remarks or 2) the buyer is screening properties for the agent, then by advertising a house to the Pottery Barn crowd, you're likely to 1) make the agent look bad in front of her clients (which won't endear you to her) or 2) as  Donne mentioned, give the buyer (and agent) a reason to question your integrity - and the integrity of our industry overall.

I actually believe you CAN be upfront about deficiencies if you keep a sense of humor about it. For example, if a house is close to a highway, you could say "Close to the highway and a little noisy, so if that's a problem, pass this by. But if your buyer is looking for a great home at a great price, give it a look!" Okay, so that's a little wordy, but I think it would be effective at both catching the attention of buyers and agents, and preparing them for the deficiency so they aren't surprised - they might even get there and say "Well, this isn't so bad!" Of course, the house needs to be priced appropriately for the deficiency!

Jennifer,

As one who works almost exclusively with buyers. I would definitely agree with a couple of your initial respondents (Martha & Susan).

The fear of the unknown can be greatly minimized by having the professional assessment by a foundation available, for those who are otherwise hopelessly in love with the property.

After all, things might actually be "less bad" than the conclusions the "nervous nellie" buyer might automatically jump to. Living in the north Texas clay soil, the foundations have either previously cracked, are currently cracked, or will almost certainly crack sometime in the future! :0)

Great thought-provoking post (as usual) !!!

Edith - that is so important. Almost any problem can be fixed cheaper than someone imagines it can be. Maybe not CHEAPLY, but cheapER!

Just had another thought on the matter... if the Pottery Barn buyer does decide to overlook the deficiency based on the great price, his inspector will likely change his mind for him, thus wasting everyone's time, energy and money.

It depends. If it's a relatively minor issue I put a note in the agent remarks and quotes for repair in the attached MLS documents with printed copies in the home so prospects can see that the repairs might not be as huge a deal as they will otherwise only imagine.

That said, if the home needs a new roof or a major repair, I would put that in the public remarks together with the estimated replacement cost. There is absolutely NO point in attracting a buyer who cannot afford the repair.

Best option is to have the owner make the repair before listing the home but that often isn't possible in today's economy.

Phil, Broker-Associate

Jennifer,

I also list properties like this, sold as-is and get estimates for the work that needs to be done. I talk up all the positive features of the house.  I also go to local banks to see what funding programs are available for that particular home. In the agent only remarks section, I ask for all agents to call before showing so that I can share the info and give them a full picture.

I say be upfront and disclose in the marketing.  Isn't it better for buyers to know BEFORE they walk through the front door of the home?  If they are left to discover the defect on their own they will wonder about what else could be wrong with the property and walk away. 

If a potential 'Pottery Barn' buyer knows about the structural issue and still takes a look he/she/they might fall in love with the house.  So marketing it as somewhat of a fixer upper (one issue, maybe include an estimate to fix) AND emphasize the Tudor features.  Perhaps include in marketing informational materials on 203k loans...  People shy away from things they don't know.

Yes!  In this case, I would know that the price was going to give the listing a lot of attention.  Then, like you said, there would be a huge let down when the home was viewed and the obvious flaw was discovered.  It's VERY hard to recover from this emotionally and get excitement back. 

So, I would, in a short sentence, have said, "The low price reflects the fact that the home needs some structural work." Or something to that degree.  Then, I know the buyers (and agent) would be prepared before walking in the home and falling in love.  And, I would make available, any information I could about the flaw and any research we'd done about repairing it.  But I would definitely want to share this information---at the very least with other agents---BEFORE they took the time to bring their clients over. 

I have two main objectives when it comes to marketing property:

1. The whole purpose for marketing a property IS TO GET AN APPOINTMENT.  It's not to tell a potential buyer everything there is to know about a property.  The purpose is to entice a buyer to want to know more and want to see more.  I try to do this by keeping descriptions short and sweet and using lots of key words.  I also try to take photos that are attractive, clean, but not unrealistic.  This is also where I will disclose something that needs to be, but the disclosure will be very short and simple with a suggestion to call for more info. 

2. When the appointment is made, and the buyer sees the property, my goal is that the property IS BETTER IN PERSON than it was in the marketing.  So, here's why it's important not to overpuff or unintentionally mislead people.  It's also important that the photos were not too nice (nicer than the property).  I want the buyer walk away having had a positive emotional response to the property.

I agree with Susan H. - address it as creatively as possible without scaring people away.  I have this issue right now with one of my listings - some of the people who have toured it "think" it's on a "busy" road so they've passed it over - I have since included in my MLS comments the fact that the road is filled more so with bike riders and joggers and also becomes one way in this particular area so the amount of cars is decreased.  I didn't go in to it too deep but, hopefully, enough to address it and move on.

I had a listing a few years ago with a dodgy front porch--sloping, big cracks. We had a structural engineer conduct an evaluation and made his report available to prospective buyers. We also received some rough (non-binding) bids from various contractors about what it would cost to fix.

Turns out that the porch was not in immediate danger of falling off the house & in fact could have many yrs of use & the cost to make the repairs was not that expensive. By doing this, we just took the uncertainity out of the equation for buyers.

I don't think I'd put it in the marketing remarks, but on the table I'd have a solution all planned out! Contrator's evaluation, a quote to fix it... 

I try to let defects in my listings show in the pictures.  If something important can't be conveyed in a photo I use something like the statements already described to draw attention to it without trying to make it sound really scarey.  Too often I see agents' listings that have major issues that are not disclosed in the pictures or in the comments.  I get calls from buyers that say "This house is perfect!" only to respond that it isn't (for whatever reason I know about because I've seen the house).

If the Seller disclosed it on the condition report, and that document is posted online, the agent shouldn't need to make remarks. If the problem can be shown in a photo as part of the property, that should clue the buyer in prior to them making the appointment. I would encourage the Seller to have an expert's report available to post online with the MLS listing and have copies available as well. Many times a buyer thinks a problem is 3 times more expensive than it actually is, and a qualified expert can put their fears to rest - if given the opportunity.

OMGoodness - Blake - that is brilliant!!!! I LOVE how you expressed exactly what I was trying to! When you disappoint a buyer, they get mad at the house, even if it's perfect for them. But if they go in with realistic expectations, they're SO much more likely to be pleasantly surprised.

Phil - I agree - there's no point in bringing in buyers who can't buy it. Especially in today's market where the lenders are fussier about condition and other challenges.

Here's the ending to my story...

We withdrew the listing from the market and while my seller and I were trying to decide what to do, I told one of my active buyers about it. I hadn't thought she'd be interested because she was definitely a Pottery Barn kinda gal, but for some reason, I brought it up one day, including the structural issue. She wanted to see it, so I took her over. She loved it, cracks and all. She even brought her parents over (warning them ahead of time about the structure) and they approved, and agreed to help her fix it. I Covered My A$$ by taking pictures of the cracks and asking her to sign the pictures that she was aware of them, along with the property disclosures of course - she bought the house, eventually fixed the problem and lived happily ever after there.

After that experience, I vowed to always do as Blake suggests - never overpromise; always pleasantly surprise. Not sayin' I was 100% successful in selling challenging listings, but I believe it was the right approach.

I think there have been some great responses and my response is geared specifically towards the scenario presented (not cosmetic issues).

It's important that we represent the property in the best light; that being said, it's equally important to identify our target market and market accordingly.  When dealing with structural issues, the average homeowner is usually not prepared to deal with such issues so it would be more important to market to an investor who has the capacity to deal with structural problems.

If you/your seller have decided to market to the average homeowner I would not want to rely upon the buyer's agent for disclosure; 1) it assumes they will 2) it assumes they have the knowledge/expertise to appropriately address it.  It's not in the sellers best interest to get them into an escrow only to find the buyer didn't understand there might be significant defects until the inspection is done.  Sales 101 teaches us to overcome the objection before the objection is expressed so why not apply this strategy when dealing with a structural issue.  Overcome the issue by identifying the problem and providing an independant report on potential scope/remedy and disclose, disclose, disclose.  You certainly don't want to find out after the close that the homebuyer feels in over their head or mislead in any way.  I practice in California and selling a home with a known structural defect to the average homebuyer; even with all of the disclosures could easily be a lawsuit in the making. 

I think a great parallel is the financial investment world; there are certain types of investments with higher risks/rewards but the average individual would not be able to participate because they do not meet the minimum experiece/net worth. 

At the end of the day it's up to you and the seller to decide on the best strategy but I say you can still talk up the great points of the home and address the issue in the public marketing comments so you start dialog off on the right foot with prospective buyer's reaching out to you directly. 

Thanks for giving us the ending to your story! I was wondering how it finished. I like the ideas of having it in the note section or speaking for itself in the pictures. Sounds like once you started bringing it up earlier you found more success.

You have to disclose it at some point, so might as well let potential buyers know up front so that you attract buyers that know how to handle things like that. The house can probably be jacked up close to level. I'm sure " This Old House" has a video on this repair.

I was just reading some of the previous posts and I like what you said about having a sense of humor.  I appreciate that when I'm reading marketing text.  We are in rural southwest New Mexico and these are some disclosures I've seen and written lately:

"Gorgeous views, but road is not for the faint of heart.  Call me if you need a 4 x 4 and I'll drive."

"Wonderful southern exposure.  Perfect for building your solar-powered home. No electricity available."

"Officially a 3rd bedroom, but might serve better as a utility room."

I could keep em' going, but I'll stop here.

LOL, Blake - I love that stuff! Creative descriptions definitely stand out from the crowd!

Laura - Wow - very very well said - yeah- exactly!

Been thinking about this situation more (not my example since it's a non-issue, but in general...) and it comes down to - as the listing agent, we are obligated to represent our seller's best interests. NOT to improve the perception of the real estate industry or to make friends with other agents or to ensure that potential buyers don't get mad at us, but to do whatever we can (within legal and ethical limits) to do what our sellers hired us to do, which is, in most cases, to SELL THEIR PROPERTY.

So, the real question is - does being upfront and transparent (in our marketing) about a property's material defect, thus potentially limiting the number of buyers who look at the house serve the seller better than NOT being upfront and transparent, thus NOT limiting the number of buyers who look at the house, but perhaps not attracting the RIGHT buyers? (whew, that was a mouthful). 

There probably isn't one right answer for every situation. We probably all have real-world examples that support both approaches, so it's hard to know in the beginning which approach will "work" on any given property.

How's that for definitive!?

Thanks for sharing your dilemma and solution, Jennifer. It seems that setting the proper expectation prior to viewing was the successful approach. (Congratulations on selling the home!)

Jennifer - I have not had the opportunity to have a listing like this, other than tough sellers like a probate client, but even at that I would put it in the agent remarks and state the obvious. Disclose disclose disclose.

I also would do as a few mentioned to market it as a contractors dream, or a fix-it to make it a dream home or an FHA203K opportunity.