Agents: AFTER Service, THEN Paid

Here’s a fantasy thought: “What if our teachers, doctors, or politicians only got paid AFTER they finished their service, to their client’s satisfaction?” And, the professional gets paid nothing until those they serve are satisfied with an acceptable conclusion. Can you imagine?

Abraham Lincoln said:  “A lawyer’s time and advice are his stock in trade“.  Their income is based on two ‘tools’ used to serve their clients: their time and advice (knowledge). 

It seems many people don’t stop to consider how their real estate professional gets reimbursed for their time and knowledge.  Perhaps, because the client is on an hourly wage or salary, they assume agents must have a similar revenue basis?

Your real estate agent typically receives no reimbursement for their expenses (gas, time, advertising, time, promotion, time, etc.) until several days AFTER their client’s escrow closes.  If the sale does not close through him/her, the agent gets nothing for their ‘time and knowledge’.

Just imagine: At your job you don’t get paid  until you completed all of the tasks.  If there is no successful conclusion to your work, you get paid nothing. You might understand agent’s frustration when that happens to them.

Oh, and BUYERS, you typically pay nothing for your agent’s services – the seller does, through their contract with the listing agent. Make sure you have an experienced agent with a proven track record to represent you. They will “cost” you the same as a rookie agent will – zero.

Peace of Mind While On The Market

Your home is on the market and your water heater goes out.  That’s the last thing you want – spend  money on something you will not get any return on.

It happened again.  A seller in Morgan Hill had their home on the market.  One cold morning they went to turn up the heat and found their furnace had gone out.  The cost of the installed new furnace: $1,800!  While they were warm again their net proceeds from the sale just dropped by a cold, $1,800.

Water heaters, microwave ovens, compactors, ovens, disposals…they all have a functional life and then give up the ghost – without warning.  Those repair bills are aggravating and, unnecessary.

A Cool Solution: Home warranty policies are available for sellers as well as buyers.  For roughly $.73 a day you can cover all of your major appliances during your listing period.  Should something go out you only have to pay a set fee, usually around $55, and the warranty company will repair or replace your appliance for no additional cost.  Click here for more information.

The payment for this warranty can be from your net proceeds in escrow.  Additionally, if your home doesn’t sell some of the warranty companies won’t charge you anything.  So you just can’t lose.

Selling your home can be an anxious time but this little tip will keep your equity in your pocket and provide some peace of mind.

Install New Carpet for Re-Sale Appeal?

A Monterey homeowner asked a question    which many sellers wonder about: “Should I replace our dated and worn carpeting  with l new flooring on the home I’m selling?”  The seller has been told “Yes” and “No.  Buyers will want to put in their own color and texture of flooring“.

This is topic which has no perfect answer. I find most buyers really want a “turn-key” home – one where they can simply move into it and live. Those same buyers often say, “we’ll change this, and that…” but, often take a long time getting around to it if they don’t make those changes soon after the close of escrow.

A  few enterprising buyers will, in fact, shop for a ‘fixer upper’.  Some have family and or friends in “the trades” and fully intend to do a complete face lift to the home they buy.  If the rest of the home is dated and in need of repairs  the seller will have spent money on carpeting that will likely be removed.

If the home is in otherwise good condition I would go with the odds and put down a complementary-color carpet. It does make a lot of difference in the ‘feel’ and ‘senses’ of that brief tour the prospective buyer will take of the  home.  We only have one chance for a first impression.  The value of getting the home sold in a timely fashion vs. staying on the market a long time suggests that the cost of carpeting is really a cost of selling.

Regarding the cost – We have a nice relationship with a carpet store where they will allow homeowners to “bill escrow” with no costs or interest for up to a year.  This kind of relationship can make the decision a whole lot easier, right?

Morgan Hill Housing Recovery

Have you noticed Morgan Hill’s housing activity?  Wow!  Recovery is well underway in our quaint town.  In May there were 73.6% more Closings than in May ’08.  This is the 5th straight month this year where our Closings have increased over last year’s figures.  To date, Closings have increased nearly 60% (59.4%)!

On the other hand New Listings of Morgan Hill homes for sale were down for the 5th straight month.  The number of May’s New Listings were down 55.4% vs. 5/08 and year-to-date the drop totals 23.5% over the same period last year!

In nearby Gilroy the same housing trends are happening!  Gilroy’s number of Closed Sales is up 128% from 2008!  128%!   Wow!   Our New Listings were lower by 27.9%.

The affects of ‘Supply and Demand‘ are being felt here in Morgan Hill and Gilroy.  While the interest rates are still wonderfully low I wouldn’t wait to buy.