Wheaton, IL

Both the Wall Street Journal and Bloomberg.com are reporting today that homes sales in December had their biggest monthly increase in nearly seven years. Homes sales were up 6.5% nationally in December 2008.

Most likely this is due to buyers taking advantage of home price cuts and homes in foreclosure.

Some great news for Wheaton real estate. 2008 condo and townhome average prices have gone up 11% since 2007! That is wonderful news considering the current real estate market and financial credit situation.

The market times have gone up considerably and the number of homes sold have been more than cut in half from the height of the market in 2005. However, these numbers are more consistent with single family homes in Wheaton.

There are some basic rules to selling your home: The first, and most important, is price it right the first time. This is followed closely by allow people inside to see the property. I know, the second seems a little obvious, but it is just as important as rule number one.

I just received this email from a selling agent.

“Did your client’s ever end up buying? My listing is still available, they are having a showing tomorrow at 11:00, I try to condense or combine showings because the seller has two babies, let me know if there is still any interest.”

Well, I tried to preview that property for my client back in early December. They were not allowing previews to agents because it disrupts the family. My clients did not have a lot of time to see properties, so I was previewing everything before bringing them inside. We ended up seeing 12 properties that weekend, one of which we bid on (closing this week – horary!). The house that wouldn’t let me inside and wouldn’t work around my client’s viewing schedule lost out on a very qualified buyer.

In any market, and especially in this one, it is imperative to allow people inside your home to see it. You can not sell a property with 25 photos or a virtual tour – no matter how good they are. Buyers want to walk around, look in closets, and see the view from the kitchen window. Once buyers have moved on, they rarely look back.

I am very understanding of schedules, dinners, nap times and Sunday morning family time. However, the buyer must be allowed to see the merchandise. And, they must be allowed to see it when THEY want to see it (within reason of course). No seller should turn away showings, EVER.

I thought it would be more beneficial to look at 2008 Wheaton Real Estate numbers in context with those same numbers from past years. I have gone back to 2005. This should give us a good idea of where we have been.

This first graph is of average sale price. The average sale price of Wheaton homes went up in 2006, had a plateau in 2007 and then dropped to just below 2005 sales prices. Now these are just averages. There are neighborhoods around town where the numbers are even lower, more in line with 2003 prices. It just depends on where you live.

The next two graphs are pretty self explanatory. The days on the market have gone up considerably from 2005 and the next graph shows the number of homes actually sold have gone down each year.

I went on a listing presentation this week and I didn’t get the job. I am a competitive person and I don’t really like to loose out to another agent. However, character and integrity are all I really have. I will not lie to people. I will not tell them what they want to hear just so they like me and I get their business. It is a tough market out there and we all need to be realistic on pricing.

Going in, I knew that they paid more for the home than it is currently worth. I presented 3 comparable properties; all were of similar size, age, construction and location. They all closed within the last 6 months. The comparable homes sold for $480,000, $495,000 and $545,000. The one that sold for $480,000 was the closest in terms of condition and updates. The home that sold for $495,000 had an updated kitchen and updated appliances. The larger home for $545,000 had a top of the line gourmet kitchen and updated baths. I told the sellers that they needed to price their home closer to the first two, maybe starting out at $499,900 or $509,000. If they want to sell in a reasonable amount of time, they need to get the pricing right the first time, or they will linger on the market. There is about 14 months of inventory on the market in their price range.

The next day I received and email from the seller asking: “Do you have any other comps that you considered in addition to the 3 presented?”

This was my reply: “I could pull other listings and make the numbers say anything you would like, numbers are easily manipulated. However, a higher listing price will limit the number of showings and prolong the listing time. Even if we do get a buyer to write a contract, the banks will use these three sales to determine the assessed value. If that number is less than what the buyer said they will pay, there is a good chance the buyer won't get the mortgage anyway.”

Well, the other agent they called in pulled three “comparable” properties and somehow came up with a list price of $650,000. Wow, that means one of us is off by more $150,000. That is a lot of money. Needless to say, they went with the agent who told them their house was worth way more than it actually is.

Am I upset I didn’t get the listing? No. I can’t sell a house that in my opinion is listed so far above what other homes in the neighborhood have sold for. I wish these sellers and their agent all the best. Who knows, maybe I will get to be their second agent.