Can you imagine that you apply for a realtors agency in order to sell your house and suddenly they tell you that it’s unsellable? Don’t let it put you down since such house problems are typical nowadays considering market changes and fluctuations. Further information will enlighten you as to how to sell an unsellable house.
The main reason for the low liquidity of a house is its age. The longer you live in a house, the more unsellable it is if you don’t take the necessary steps. So, it’s time to reveal the key problems and present an effective solution to let you sell an unsellable house.
Housing trends sail by faster than most of us have time to notice, but when it comes to selling your house, you might suddenly wish you’d sat up and paid attention before. Some styles can be put down to the vagaries of fashion and are easily fixed — gaudy wallpaper isn’t difficult to replace, but moving a laundry room above ground or fitting a proper staircase is another story entirely.
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Issues That Could Make Your House Unsellable
It’s easy to go “nose blind” to your own home, but when strangers stroll through it, they’ll be sure to notice any unsavoury smells. So clean every room top to bottom. Rent a machine to get the funk out of carpets and take drapes that aren’t washable to the dry cleaners. Pick up pet accidents promptly, empty ashtrays, and avoid frying fish before hosting an open house. Open windows for cross-ventilation, but don’t go overboard with air freshening products—ideally, the house should smell clean, as if no one lives there. Once you deodorize, ask a trusted friend to do a walk-through and let you know if anything offends.
Lack of Natural Light
You may consider dim quarters cozy, but most home buyers today are looking for spaces with ample natural light. Dark interiors hide the layout of your home and can make the place feel gloomy. To brighten things up, repaint in white or light colours, and choose a glossier, more reflective finish. Rearrange furniture so that nothing blocks the windows, and replace heavy curtains with sheers to let in more light. Simply hanging some decorative mirrors will help. Suppose you’re contemplating renovations to make the house more marketable. In that case, illuminating improvements include putting in additional windows or a skylight and adding shinier surfaces to the kitchen or bath (a glass tile backsplash, a stainless steel counter).
Malfunctioning Major House Systems
If your furnace, air conditioner, hot water tank, or any other major system is not operating properly, undertake repairs before attempting to sell. Such issues will surely turn up during a home inspection, the prospective buyer will commission, and even if you agree to pay to have things fixed, the very presence of a problem can spook a buyer. An HVAC expert charges between $200 for a simple maintenance call to $8,000 if your furnace needs to be replaced.
Older abodes may be fraught with anything from aluminium wiring to faulty pigtails, and even newer homes can have their share of hidden electrical troubles. If you notice flickering lights, have switches that don’t seem to operate anything or know that your fuse box hasn’t been upgraded in 20 years, a home inspector will spot these red flags in a flash. Outdated electrical is a turnoff to would-be buyers since as a major source of fire risks, it’s likely to raise their insurance estimates. So hire an electrician to ensure your electrical system is at least up to code (simple repair can cost around $300), even if you don’t invest in bringing it completely up to date (approximately $15,000 if the entire house needs rewiring).
Cluttered or Confusing Kitchen
These days, just about everyone’s version of a dream house includes a spacious, open kitchen. Suppose a major renovation to enlarge the footprint of your cook space isn’t a possibility. In that case, you may want to take on some smaller improvements that make it easier to navigate, function, and congregate in the kitchen. Think about what kinds of changes you can affordably make for greater efficiency, such as reorganizing appliances to create a triangle workstation or upgrading cabinetry for additional storage. At the very least, get rid of all clutter by purging nonessentials from surfaces (no piles of mail on the peninsula, all pots and pans stowed).
Water Damage and Lingering Dampness
Water damage—appearing as cracks in your foundation, stains on surfaces, or even mould—are likely indications of plumbing problems, excess humidity, or leaks in an outer wall. Before fixing the cosmetic issues:
- Discover and repair the root of the problem.
- Unless you’re experienced in plumbing, don’t go poking around yourself, as locating sources of water damage can be tricky and possibly dangerous.
- So call a pro and be prepared: A plumber may charge only $150 to fix an accessible leak, but a more complex problem can run at up to $1,500; should you need mould removal, insulation replacement, foundation damage, or any other major repairs, you may have to bite a $10,000 bullet.
Old or Dated Decor
While you enjoy your furniture and knickknacks, prospective buyers will find it challenging to imagine themselves living in a space filled with your stuff. Consider hiring a professional to stage your home for sale, for a fee ranging from $500 (to redecorate with existing furniture) to $5,500 to use their pieces to update interiors. If you’re not prepared for this expense, remember less is more—fewer large items enable house hunters to envision their items in the rooms. Ask yourself if, when you sell, you’ll want to move all your belongings. Didn’t think so! Throw a yard sale or donate what you can.
Exterior Maintenance Issues
Roofing in disrepair, busted porch steps, damaged siding, or a peeling deck could make would-be buyers flee before coming in the front door. Neglecting such repairs displays a lack of pride in place and can cast your neighbourhood in a bad light, too. Fortunately, some fixes—like a fresh coat of stain for your deck—are DIY-able; do them to show that the house is worth maintaining.
You might not know what’s lurking under your roof. So before putting your house on the market, give the place a thorough going over for signs of pest infestations that can lead to structural or electrical system damage. For instance, termite evidence looks like piles of sawdust along your walls, while droppings in pantries or along baseboards point to rodents in residence. Mould and mildew can be present in on window frames, in bathrooms, or nearly any other area of the home–be on the lookout for black stains or spots that appear to dark to be dirt.
Thinking of transforming your basement into the Bat Cave? Don’t expect the trendy, elaborate, or uniquely personal style to bring a major return on investment (ROI in real estate lingo). Redoing the kitchen or master bath may well appeal to buyers, but most folks won’t go gaga over a gazebo, a sunroom, or even eco-conscious solar panels. Even remodels that should see a great ROI, such as increased square footage, can backfire if the average price of a house in your neighbourhood doesn’t support your home’s elevated value. Pricing yourself out of the average range often leads to your home sitting on the market as the house around you sell. So keep renovations basic and attractive to the average home buyer.
While your home is hardly an Amityville Horror, if a sad or criminal event unfolded there, it could cast a gloomy cloud over its sales potential. Sellers in most states are required disclose a murder or suicide that took place on the property, and homeowners in California, South Dakota, and Alaska, must inform a prospective buyer of any deaths in the house, even a peaceful passing. No matter where you live if a would-be buyer asks about deaths in the house and you fib about the facts, you could later face legal repercussions (check out Diedinhouse.com to research a home’s history). You’re also obliged to tell all if asked about criminal activity, such as robberies. Some people may believe that bad guys will return to the scene of the crime, and even if that’s unlikely, burglaries, in general, don’t bode well for a neighbourhood.
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Unreasonable Price Tag
You might consider the home you’ve lived in for 20 years to be priceless, but its nostalgic qualities are only valuable to you. While undertaking repairs for any of the major issues discussed in previous slides can be reflected in your asking price, if you want to sell—sooner rather than later—ensure that the price is right. Explore online what similar houses in similar neighbourhoods have sold for. Contact a few real estate agents for their opinion, or even consider getting the home appraised. To find a home appraiser, search the National Association of Realtors; with a price range of only $350 to $500, it may be well worth your while.
Location, location, location is a real estate credo for a reason: Few people want to live in a dicey neighbourhood, next door to noisy, inconsiderate folks who’ve let their place run down, or within earshot of railroad tracks, an airport, or a busy highway. However, neighbourhoods are often in flux, and yours may be on the upswing. There’s not much you can do about your location, but if you keep your home well maintained and price it accordingly, you may find the perfect buyer. After all, you only need one!
How to Sell an ‘Unsellable’ Home
You Are Not Your Customer
It is very common to craft a sales plan, look at it, and think, “Yeah, I’d buy that!”
But to reach your strongest selling position, you need to understand your product from your target buyer’s point of view. This may differ a little or a lot from your point of view. When you are selling, you need to get out of your head. You need to think like your potential buyer, who might be—and very likely is—nothing like you.
So, if you think the house is “unsellable,” that tells you that you are looking at it from your point of view—the angle of why you would not choose to buy it. And if you only focus on pitching the sale to an audience of buyers who think, act, shop, and buy like you, then you are right, it WOULD be “unsellable” to someone like you.
Don’t pitch the sale to you. Find the buyers who would want that house. Position the product you are selling, in this case, a house, to the buyers who would value what that product offers.
Shift Your Mindset
To do this, you have to step away from the limitations you placed on that house. Change your mindset, so you begin seeing it as a highly saleable house. Think outside the box and brainstorm who might want the property with the “flaws” you perceive it has—or better yet who would not even consider those things “flaws” and might even perceive them as strengths.
Now, I am not speaking about issues of pricing here. You can always change the price. So, if you are judging a house to be “unsellable” solely based on the issue of pricing, that fix requires altering your mindset about what kind of profit or loss you are willing to accept.
I am addressing broader issues about a property that can cause it to seem undesirable or seen as a potential liability (for reasons of location, condition, rehab-gone-wrong, etc.).
Let’s talk about how the perception of a property affects its value, negotiations, equity, and success. At the same time, I’ll give you a little twist on the idea of “unsellable” and how that works differently depending on how you pivot the concept.
The Story of the Forgotten Carriage House
An investor I know, Tim, found a property that had been on the market for about 12 years. (Yes, you did read “12 years.”) If you saw the property, you would understand why it was on the market for that length of time.
It had originally been a carriage house, a term coined to describe buildings where literal carriages were stored in prior centuries (essentially a garage for horse-drawn carriages). Often there was a living area above it that was occupied by the coachman. The horses themselves were usually housed in a separate barn building.
Nowadays, the term is used to describe buildings on a property used as additional quarters for various purposes.
This particular carriage house had once belonged to a much larger estate. Over the years, parcels of the estate had been acquired by different developers, and multiple neighbourhoods had gone up on that land. But this carriage house had been left out of the mix.
So, it sat for decades, a deteriorating eyesore outside all these lovely neighbourhoods of various ages.
Eventually whoever last owned it passed away, and no one inherited the property. It reverted to being city-owned, where it sat on the books for a very long time. At a certain point, the city decided they should get on with selling the property. They listed it for sale on a city-maintained website. That is where it sat for 12 years.
During this time, the property had fallen into a state of complete disrepair. Tim drove by the house frequently over the years, each time thinking of the unique ways this building could be refurbished.
But his curiosity about the house and his search for the owner led him to the city’s website. He submitted a bid.
Now, here is the original stance on the mindset of “unsellable.”
As the listing had been sitting on the city-maintained website for 12 years, the city had come to view the property as “unsellable.” In truth, however, they were not thinking creatively about how to market it to attract an appropriate buyer. So, with each passing year, it became more and more difficult to sell. A vicious cycle, their perception that it was “unsellable” caused them to shut down their creativity and with it any unique possibilities.
How a Buyer Can Use “Unsellable” to Their Advantage
Because the city had come to perceive the carriage house as “unsellable,” Tim was able to use their negative perception of the property in his negotiations. Hence, Tim negotiated the purchase of the property for less than 5 per cent of the asking price.
Tim did not view the property as “unsellable.” He viewed it as having “incredible potential.”
Tim was correct. He bought it for $1,800.
At that price—and with a solid plan for the building—it was easy to get financing for a complete rehab. He brought in a partner. They made changes to the existing house, turning it into a thriving multi-unit short-term rental property in the heart of the city.
The equity value is currently 244 times what Tim paid for the property. The carriage house is now valued at $440,000.
In addition, as a short-term rental, the house is currently turning more than a $100K a year in profit.
All this from an “unsellable” property.
Learning from the City’s Errors
The example of the city’s experience teaches us that, once you place a label on something, you will respond and act upon it with the label you have assigned to it. Don’t make the same mistakes the city made.
Once they assigned the label of “unsellable” to the carriage house, the city began to believe and act on that perception, causing them to commit the following errors in judgment:
- They relied on limiting assumptions about how to value the property.
- This blinded them to the potential value of the property.
- Thereby, this caused them to judge the property to be “worthless.”
- This eliminated any attempt they might have made to market the property effectively.
- Which, in turn, allowed an investor to pick it up for a song
The “unsellable” label they assigned the property limited their vision and therefore their potential for profits.
Kicking “Unsellable” to the Curb
What the example of Tim’s experience teaches us is to look at the property with fresh eyes. Make a very detailed list of all the pros and cons of the house and the surrounding yard.
Be objective. Be specific. Be alert. The more detailed you are, the greater your chance of finding the hidden marketing gems you might otherwise miss.
Also, be willing to step outside yourself and your perceptions. Call in a friend, mentor, or colleague who you know can always find the good in everything. (By the way, if you don’t have anyone like that in your life, start cultivating those relationships.) Positive thinkers and outside-the-box thinkers will spark creativity.
Walk the property with them. Get out of your way. Listen to what they say.
If they say they like some aspect of the property, whether the yard or the house, don’t bring up objections! Ask them why they like that item or feature. Delve into what benefit or value that detail adds to the property for them.
Next, let go of the idea of “problems.” Every problem is an opportunity.
So, look carefully at the “cons” or the negatives on your list. This is when your true creative power switch gets turned on. Open your mind and come up with a positive slant for EVERY “con” on your list. I mean it.
And if any one of those “cons” really stumps you, pull in that positive-thinking friend again—maybe even make them a partner.
No matter the reason(s) for perceiving a house as “unsellable”—whether you think your property is in an undesirable location, someone died in the house, there are condition issues (deferred maintenance, pet smells, water damage, mould, lead), there’s a lack of amenities, it’s inconvenient architecture, has outdated appliances or decor, or any other “unsellable” feature—let go of viewing it as a limitation. Shift your viewpoint.
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It’s Your Choice
Stop assuming a challenge is a barrier when it is only a hurdle. Jump over it, go around it, go under it, maybe smash through it. But look for the opportunity.
As we say in marketing, find the hook. Find the take. Find the slant.mIn other words, find the opportunity.
Keep your eyes open and your creativity flowing. This is the beauty of real estate investing: One person’s shanty is another person’s castle. It is all in the perception. Change your attitude, and you change your options!
All the unsellable issues mentioned above are solvable and require very little in terms of cash investment. However, one more “secret issue” can make your house unsellable. It deals with the wrong real estate agent that is able to convert even a palace into an unsellable house. However, if acting independently, it’s difficult to make an objective assessment of your property. That’s why a credible real estate agent will be helpful.