The 'One Year Plan' for Selling A Home

Posted: Oct 13, 2008 12:01 AM
The 'One Year Plan' for Selling A Home

They're a couple at the front line of the baby boom generation -- he's 62 and she's just behind. Once they were boating enthusiasts with a sailboat, powerboat and pontoon. To enjoy their fleet, 20 years ago they bought a lakeshore lot and built a stunning cedar-sided custom house.

Now the couple is selling their fleet to focus on his worsening health problems and her mother's Alzheimer's disease. With little free time or energy to spare, they'd also like to sell their one-time dream house, which has become a burden. But it's in such awful condition -- with junk heaped everywhere and overgrown landscaping -- that they've given themselves a full year to raise it to current market standards. Otherwise, they'd be compelled to take a big hit on price.

They embody a stark reality of the present real estate market: Only homes in superb shape now fetch their full current value. Others either languish unsold for a lengthy period or go for a sacrificial price, says Mark Nash, a real estate broker and author of "1001 Tips for Buying and Selling a Home."

Although the couple with the cedar house would like to liquidate as soon as possible, Nash says they're smart to realize the enormity of the task before them and to give themselves a long lead time for the restoration process.

"Putting your house on the market before fixing it up is equivalent to hanging out a red flag that screams 'take advantage of me,' according to Nash.

Many would-be sellers can't afford to take a "time out" period to ready their home for the market. This is the case for owners who must sell promptly due to a marital breakup. It's also true for those under heavy financial duress -- perhaps due to a job loss.

Fortunately, the couple isn't in an urgent bind that would force them to unload their property immediately. And convinced as they are that their neighborhood real estate market will rebound in 2009, they're not fearful about delaying their sale until next year.

Here are pointers for would-be sellers who need up to a year before they'll be ready to sell:

Move into action mode.

Real estate experts typically advise against waiting for a "better time" to list and sell your house. One reason is that sellers who postpone often endure high carrying costs, particularly if their properties are allowed to go vacant.

But some prospective sellers whose homes are in bad condition are in a different position. They'd like to move to a larger home but face no imperative to sell immediately. And they know that going to market "as is" would mean a huge financial penalty for them.

"If your place reeks of awfulness, you're going to sell for far less than necessary. Expect to take a hit of at least 10 percent or more off the prevailing sale prices in your community," Nash says.

Find the right listing agent to serve as your project coordinator.

If you're staking out a period of months to transform your fixer-upper, make sure you approach the task in an orderly, organized way. No matter how much time you've allowed yourself, it's imprudent to procrastinate.

One way to effectively chart a plan -- and then to ensure you stay on track -- is to find a listing agent willing to serve as your project manager, says Eric Tyson, a personal finance expert and co-author of "House Selling for Dummies."

"Not every agent will step in months in advance to guide your work as a consultant and adviser. But some agents will do this, so long as you promise them they'll get your listing when the time comes to sell," Tyson says.

As he notes, a skillful listing agent can help you develop a checklist of tasks, set a timeline and interview contractors. The agent can also make sure you progress as quickly as is reasonably possible.

"If there's lots of work to be done and you're unavailable -- or not particularly organized -- the right listing agent can become an invaluable mentor," Tyson says.

Seek out help to de-clutter efficiently.

Nash cautions that people who try to take on a big de-cluttering job on their own often get bogged down. Indeed, he says some people are still sifting through their possessions after several years of on-again, off-again effort and that they need help to mobilize.

"Chances are your real estate agent isn't going to work with you day after day to plow through your possessions. But for a reasonable hourly wage, you should be able to find someone to help with the grunt work and to give you momentum," Nash says.

He says a classified ad offering $7 to $15 an hour for organizing help should yield you multiple applicants, including high school or college students who are eager to exchange their services for extra spending money.

After you're done with de-cluttering and repairs on your place, it's time to lead an extensive cleaning binge on your property. By making your property immaculate, clutter free and in top repair, you'll be well-positioned to sell in early 2009 or whenever the work is complete, Nash says.

"Serious buyers in today's market will only accept a house that's in shipshape condition. If you compromise on either cleanliness or fix-ups, your place will probably go begging," he says.