Clayton Living & Real Estate

Many sellers mistakenly feel their carpet looks great to buyers, when they know deep down it doesn’t. The truth is that your floors set the tone for your entire house, and when that element is worn or neglected, buyers may correlate your carpet condition to the rest of the house. Carpets that have been lived on for over 3 years are usually worn. That doesn’t mean it needs replacing, but you should assess if it is attracting or distracting buyers. I encourage Clayton homeowners to view flooring as an opportunity to generate a higher sales price.

CLEANING
I learned the difference between low and high end carpet cleaners this year. My Eagle Peak neighbor Carol recommended someone. His quote was 3 times more than previous cleaners ($600). It was worth every penny, and this is what I got, that I’ve never received in the past: 1) The Referral: I’ve never received a carpet cleaner referral. I think this is because most do not do a great job, several are temporarily in the business, and many charge a lot more than their “$9.95 per room” advertisement. 2) Equipment: Industrial strength, new, truck mounted, well maintained. 3) Professional: Initial quote and final price were clearly described and accurate. 4) Punctual: I normally get a window of 4 hours to wait for someone. Wish I could bill them for my time. 5) Explanation: Of the process and gave realistic expectations for areas with severe or mysterious stains. 6) Results: Hand brushed all corners and stairways along with a quality vacuum. The carpets looked great even before the steam cleaner was used. When finished, moisture on tile and hardwood floors was wiped down, windows were opened for drying. No scuffs or damage to corners from the long hoses and power cables.

REPLACING
If high traffic areas are obvious, replacement should be considered. If the color or texture is dated or does not match well with surrounding hard floors or furnishings, choosing a carpet that is contemporary in style will greatly enhance your home’s appeal. Avoid buying the highest or lowest quality carpets. You may not get the best return on the highest quality, and expect Clayton home buyers to notice if you bought the cheapest one. In our Oakhurst neighborhood, expect a $3,000 - $6,000 investment, depending on your size home. Stick to a mainstream color palette, like our industry standard “real estate beige.” It may not be the boldest statement, but it is the safest answer. Most people don’t know this, but the padding under the carpet is important too. Thin, lower quality padding actually wears the carpet quicker and is less comfortable. The price difference is minimal, so don’t save here, especially if you’re going to be using it.

REMOVING
I know several real estate investors that flip houses for profit. Replacing carpet with hardwood floors and tile is one improvement they all agree on. When I take buyers out to view properties, their reaction to hard surfaces is significantly more positive than that to any carpet. For many, it sets the tone for the remainder of the visit and makes the home contemporary. It does cost to get their attention though, budget $10,000 - $20,000 for this investment, depending on your square footage. Will you get your investment back? This month I’d say you’ll recoup your cost, 8 months ago, you would have made twice your investment.

WHICH ROUTE?
In most instances, these improvements will generate more than their cost in the sales price, sometimes double. In softer markets, these improvements may not generate profits, but they will contribute to a quicker sale at market value. Never forget that buyers are going to see competing properties close to yours, and I assure you that flooring will be a big consideration if what you offer is superior.

We have a new feature on the sales map this month. Other than seeing the home sale prices by geographic area, wouldn’t it be useful to know if it sold above or under list price? Well here it is. Red indicates it sold for under list price, green is above and black means it sold for asking price. We’re seeing alot of red this month. Eight months ago we would have seen nothing but greens and blacks. Realtors [and sellers] are still fond of the prices from a few months’ back, as indicated by all the red. As the market levels off in the coming months, expectations will change, sellers will adjust, and the chart will start showing equal parts of each color. Although I was responsible for one of the greens this month, I’m not sure I’ll be able to keep my track record next month.

It’s happening a lot in our Oakhurst neighborhoods these days. A home doesn’t “sell itself” as sellers claimed 8 months ago. Buyers are smart, picky and have options. There are 6 homes on the market in Clayton for each buyer out there. If your home has been on the market for a long time, chances are it’s due to one or more of the following reasons.
Price. If it’s too high, buyers will choose a competing property. If it’s too low, they may assume something is wrong with the home. Know what is on the market today, and know the sales price of similar homes in the past month. Do not focus on the sale price of that home down the street that sold in the spring. Adjust your expectations accordingly, because even if your house is the best in the neighborhood, don’t expect buyers to pay much more than today’s rate.
Promotion. Your real estate agent or you (if selling on your own) need to work hard to market your property. The days of posting the listing to the MLS and waiting for offers are over (for a while, at least). The home needs to be actively well marketed. That means quality photos, good descriptions, online postings, other advertising, convenient access / open houses, and a ton of exposure.
Presentation. Always show the house in it’s best light. Go to a model home at a new construction development in Livermore or Brentwood (both within 30 minutes of Clayton) and emulate what their interior designers have achieved. They spend millions each year on this important task - get as close to their results as possible. Remember how clean your home was the first day it was introduced for sale? Homes get dirty and weeds grow in the garden over the course of time - don’t overlook the importance of these details to first time visitors.
If your house does sit on the market and you’re feeling discouraged, never slow down your efforts. Do more, get creative, listen carefully to buyer concerns and industry professionals and adjust your efforts. You will generate a sale if you stay focused.

When Clayton Oakhurst residents ask me the value of their homes, it’s usually a test to see if I know what I’m talking about or them wanting a professional to confirm the value they already calculated. Most residents in this area know the value of their home within 5%. Why do they have such insight? In general, they’re an educated bunch who really care about their homes. But there is more to it.

Retirement: Primary residences are now playing a huge part in their retirement fund. So many have lost confidence in company retirement plans, stocks and other traditionaly attractive long term plans. They want something more tangible, controllable (maintenance & improvements, not market), and something they can use today while it appreciates. If their house changes in value, it directly affects the quality of life in retirement years.
Comparison: Keeping up with the Jones’ is evident in our neighborhood too. Even if houses within 2 blocks of each home are no more than 15% different in value, we still like to know where we stand.
Cash Source: The past few years have trained us to see our aggressively appreciating homes as “bank accounts” where we can draw money as long as we leave around 20% equity in the home to avoid unattractive loan conditions. Those of us that have relied on this source of money for improvements or living expenses are not going to enjoy the flattening market in 2006.

Whatever the reason for their insight, it only makes my job easier. Market educated residents that are interested in the industry keep me on my toes but also require me to do a lot less convincing when it comes time to choosing a sales price for their home.

Over the past year I have had about 50 buyers request a single story home in the Oakhurst area of Clayton. There were none on the market at the time, and when one did come on, it was gone quickly after a small bidding war. They were rare because only 15% of the homes are single story, but more importantly, about 80% of single story residents are retired or soon-to-retire folks. That means they are staying and it’s most likely their last house (one resident told me it was his “final resting place”). As of today, there are 6 beautiful single story homes for sale in the Oakhurst area. I have never seen this before, but we may be seeing more of it in 2006. In the past, these homes would get an extra $75,000 just because they were single story. Today, there is no premium for them and in some cases, they can be less desireable to some buyers due to their larger footprint resulting in a smaller yard. If you want one, now is the time.