Updating Before You Sell

Christian: [0:01] Hello, hello, and welcome to another edition of the Awesome in Seattle podcast. This is your host Christian Nossum of the Awesome Nossum Group at Wilson Realty Exchange, Inc, and today we wanna talk about prepping your house for sale. We'll cover topics such as what updates do buyers actually care about, which updates are a complete waste of money, and should you even make the effort to do any of these updates at all? We will also share with you our strategies for doing these updates with no upfront cost to you. Yeah, that's a fun part. Ooh. So this episode isn't just for people looking to sell right away, but also for homeowners who wanna be thoughtful about the updates that they do as they enjoy their house so that when the time does come to sell, they've made the choices that will help their home sell quickly and for the most m- money in the future. But before we get into it, let's say hello to my fabulous co-hosts, the awesome, hardworking agents of the Awesome Nossum Group. First up, the one, the only, the data guru, Mr. Jason Saldarriaga.

Jason: [1:02] Me? Me, the data… Oh. Yeah. I, I, I mean, hello.

Christian: [1:08] We have the newest member to the team, Nick Toll.

Nicholas: [1:12] Hey. That's me.

Christian: [1:14] That is you. And this fellow Seattle native, Ms. Reed Watson.

Reed: [1:22] Oof. Hi, everyone.

Christian: [1:25] We were just talking about allergies.

Reed: [1:26] Yes,

Christian: [1:26] we were. Weird. All right, so let's start by going over why you'd want to consider doing any updates at all. Now, I'm sure you've heard that in this market, it's, when it's so hot you could literally sell a shack with three walls and no roof and get multiple offers on it, sell for $300,000 over the asking price with no problem. So why would you do anything at all? Well, first off, the market is cooling off a bit, and we're actually in the middle of a shift. That said, supply and demand is still out of whack, so we're still in a seller's market right now. But if and when the market evens out, which it always does, and it fully shifts into either a balanced market or eventually a buyer's market, deciding whether or not to do updates at all is even more important, because it can really help or hurt your selling equation. So the main reason that a seller might wanna do some minor updates prior to selling is because putting your home's best foot forward will not only sell your house for a higher price, but it'll also help it sell quicker. This is the same reason we do professional photos and hire a professional stager. The better the home looks, the broader the buyer pool that it appeals to, the more offers and the higher price you might get.

Jason: [2:42] Yep. Now, before we go any further, I think we should acknowledge the elephant that is in our room. He's right here in front of us. Most potential sellers in Seattle have, uh, one big roadblock in their mind, and that's a logical one. Where would I move if I sell my house? First off, lots of people are finding great homes to buy and getting offers accepted, so there are homes out there to purchase, especially like you mentioned, Christian, things are changing. Mm-hmm. Um, if you're listening to this in the future, which by the nature of how time works, you will be- um, the market will have changed regardless. Thank you, data guru, for explaining that. Yeah, I'm a physics guru now. But yeah, regardless, the market is still competitive currently, so a lot of sellers are hesitant to sell their home when worried that they might not be able to find something to move into. If you wanna explore your options, we are always happy to sit down one-on-one and chat with you. We can also connect you with a mortgage broker who will work with you to see if it's possible for you to purchase a new home before selling your current place, which is kind of the easiest way to do it, if possible, right?

Christian: [3:59] Mm-hmm.

Jason: [3:59] That concern will not be valid if that's the case, so we try to do that. It's not always possible, though. Um, we also wanna make sure your timeline concerns are met. Um, now if you wanna dig deeper into some of the strategies we use in regards to helping sellers buy and sell their current home at the same time, then I recommend you check out, I think it's podcast 16, Movin' on Up. In it, we discuss timelines and the overall process. So yeah, definitely check that episode out for more deep of a dive.

Christian: [4:32] If you take one thing away from this episode, I hope it is this: We are more than happy to come over to your house and help you decide what renovations you should or should not do. Even if you're not thinking about selling right away, like that's totally fine. With remodeling, it's sometimes hard to decide what updates to do and what will give you the best return on your investment. So please reach out to us. We are your advisors for this asset of yours, and we are happy to help you out anytime. We can help you understand the differences between the comparable homes in your area so that you can make sure that your, your remodel choices are appropriate for your home and its location and its price point. Now, all that being said, it doesn't always make sense to do updates before coming on the market. Let's go over some of the pros and cons.

Reed: [5:20] Yeah, you're right, Christian. It doesn't always make sense to do these updates. There isn't really a one-size-fits-all plan for getting your house ready to sell. There can be pros and cons based on your home, the current market conditions, as well as your personal goals and your personal situation. Sometimes it might not make sense to do any updates at all. So here are some general pros and cons to keep in mind when deciding whether or not you're gonna do some updates prior to listing your home. Pros, your home will appeal more to buyers, right? That's kind of why you would do it in the first place. The right updates can yield a higher sales price, so it might make sense financially. The home will sell quicker, ideally, and not sit on the market as long, and, you know, sitting on the market could also potentially lead to a price drop, so back to that higher sales price as well. Cons, it takes time, so you might miss your window if you're trying to list your house at a really specific advantageous time. Um, the month of December is notoriously slow, so if you were to, you know, do a bunch of renovations that push you into the month of December, then it might not be the right choice for you. Um, or maybe if you wanna try and get it sold before your kids start school or something like that, you wanna take into consideration how long these renovations can take. Doing updates is also just more complicated than not doing them, and it takes some effort. We can help you to do a lot of it, but as the owner of the property, you do have to navigate schedules, have, be okay with, like, loud construction going on in your house, et cetera. You also might have to move out sooner to accommodate for the renovation or, as I said before, you would, if you don't do that, you have to live with construction happening around you. So that's another big con if that's not something you're up for doing.

Nicholas: [7:13] So which in- uh, which updates give you the best return on investment when you're planning to sell? Well, first would be painting. Interior or exterior paint is the most common update that sellers tend to do, uh, and it makes a huge difference. Generally, we would recommend something like white for the interior. Uh, and for the exterior, something neutral. Uh, white is a good option for that too, but also gray or blue. Uh, and then we, we can also help you choose some colors because everybody's house is different. Um, and, uh, these are just kind of guidelines.

Christian: [7:49] Um- Mm-hmm. And sometimes you don't wanna be, like, if there's already six white houses on your block, you don't necessarily wanna be the seventh sometimes. Right. So we can help with all that too.

Nicholas: [7:59] And then, yeah, kitchens can also have a huge return on investment. Um, minor updates, even just minor updates can be great, like painting cabinets, changing a backsplash, new countertops, new appliances, things like that. A really old kitchen that's, like, really closed off from the rest of the house, better to have, like, a- an open layout. So if your kitchen has got that really old, closed-off feel to it, then, then a bigger renovation can help. But yeah, the minor updates are really all you need for, um, in a lot of cases.

Christian: [8:33] Um- Yeah, and that's one of those things where you lean on us. Lean on us to help you decide if it makes sense to do those bigger, more expensive renovations, um, because that's where, that's where our expertise comes in. If it doesn't make sense based on the cost and time and your specific price point in your neighborhood, then we're gonna say, "You know what? It doesn't make sense. Let's just do a really inexpensive, quicker, minor cosmetic rehab versus the full-blown kitchen gut and replacement."

Nicholas: [9:06] Exactly. Yeah, like if you do, if you do, like, all Sub-Zero and Wolf appliances and gut the kitchen and everything, and, you know, soapstone countertops, but the average, you know, the median home price in your neighborhood is only, like, $500,000, people are gonna be a lot less likely to wanna buy your house because it's gonna be overpriced-

Christian: [9:26] Mm-hmm

Nicholas: [9:26] um, for the neighborhood.

Christian: [9:28] Um, and yeah, also bathrooms can be a good return on investment as well. You can replace or paint a vanity, can do the mirror, lighting.

Nicholas: [9:36] I've seen a lot of times people will update bathrooms so that they fit the period of the house really well, but they look like it was just built. Like, in some mid-century modern houses I've seen really cool, you know, new diagonal tile and, you know, marble thresholds and stuff. It's really cool. Um, it looks like it was just built. Um, that can be a really cool way to do it too.

Christian: [9:58] Yep. Flooring is another super common update that we suggest that sellers do sometimes. Replacing old, worn carpet or refinishing hardwoods can make a huge difference. Uh, if the carpets are still in good shape, having them professionally cleaned can give the house that fresh and clean feel that buyers really crave. Sometimes replacing a room that has carpet with a product called luxury vinyl plank, AKA LVP, can be a great cost-saving option to refresh the look and feel of a space. But it also depends on the price point of your home. Sometimes LVP isn't the right product based on your home's price point. Um, it can feel a little cheap when it should've been hardwood floors. At the end of the day, cosmetic updates on your home can really make a big difference when you sell. But like we've said, there's no black-and-white answer as to what updates are the best for you. So here's a tip. If something is going to make a buyer hesitant to make an offer on your property, you should probably change that thing. Then always take that roadblock away in the buyer's mind if possible. Uh, especially if it's something that's dangerous, like a rotting deck that you shouldn't be walking on, or if you have really gross stained carpet, like, that's an obvious thing to, to replace.

Nicholas: [11:14] One other thing to keep in mind, don't go overboard. Like I said earlier, yeah, if you add all Sub-Zero Wolf appliances to a house that, you know, none of the other houses around it are ever gonna sell for as much as you are gonna um, have to price it at if you've just done that to your kitchen, you know, it's gonna make it less attractive to buyers. So don't go overboard if you're about to sell. Uh, there's lots of updates that you won't be able to make your money back on. And so, yes, have one of us assist you in deciding what makes the most sense. One thing to pay attention to, one thing to pay attention to as you're updating your property for listing it is fixtures and finishes. There's a huge range of fixtures and finishes, uh, uh, as far as levels, uh, and prices. Uh, sometimes sellers go overboard in choosing really expensive light fixtures. Backyard concrete is also another thing. It can be really expensive, and it often just doesn't give you a very good return on investment. Another backyard blunder is adding brand new sod when your grass is already fine. Buyers don't care. So yeah, just try to make choices that'll appeal to the masses, and not just to you or your lifestyle. You're trying to fix it up with, um With selling in mind

Christian: [12:38] Yeah. Now that we know what updates to do and how to decide which makes sense for you, let's talk a bit about the timeline. Reed, let's, let's kind of lay out the timeline for everybody.

Reed: [12:48] Sure. So if you're going to list your house with us without doing any updates, generally our process takes about a week or two from when you hire us to when your home actually goes on the market. If you are gonna do updates, it takes a bit longer, obviously depending on the amount of work, and the process usually looks something like this. So first we'll come over and we'll walk through the house with you and make a list of updates that make sense for you and for your property. Then we'll connect you with contractors for the items on said list, and you can of course use your own contractors and vendors as well, but, you know, we have a list of lots of people who are great at what they do as well, if you need recommendations. Next, we will help you schedule all of those contractors to come and do their part, uh, which, you know, the timing can vary based on what you're getting done to the house and who's available when. If you've already moved out of the home before the work is being done, then we'll put a contractor key box on the house so that they can access it and get in when they need to work. And it can take anywhere from a few days to a few months, depending on how intense that work is. And we can help you make design decisions as things progress, like, you know, painting, flooring, that type of thing. Tell you kind of what styles buyers are currently gravitating towards. And then once the work is complete, we have our cleaner come, and then the stager comes through, stages the place professionally, and then the professional photographer comes through, takes the listing photos, and also creates a virtual 3D tour of the property. So then we prep all of the marketing materials, and we put it on the market, and that whole process typically takes A month to two months, again, just depending on the scope of the work that you're gonna get done before you list it.

Christian: [14:37] All right, so I bet the biggest question that you have at this point

is: [14:40] how the heck do I pay for all this? Now, Jason, you've actually used some of these strategies, uh, to make sure that our sellers don't pay anything out of pocket. Let's, let's kinda go over that.

Jason: [14:51] Yeah. Uh, it's surprising to a lot of people, but the truth is many of our sellers actually do not end up paying out of pocket for the various updates they do to their home pre-listing it, you know, in order to list it. Now, there are a couple ways that this happens. The first o- option, and probably the most common, is a HELOC. A HELOC is short for home equity line of credit, and with one, you basically use your current home as collateral for, for the loan. And the loan itself, it really, it's a line of credit. It's similar to a credit card. Um, you can pull or take out as little as you w- want and as much as you need, up to your limit, obviously, which is really handy in this case because it gives you a lot of flexibility to get the projects done that you, you need to get done. It also reduces some of the stress involved in that. Secondly, a- another reason that HELOCs are really partic- are particularly popular to pay for pre-listing work is that they Have a variable rate, which is either good or bad. However, there's generally a fixed rate period the first 12 months. So if you're getting work done with the hopes of selling it, um, oftentimes you'll have it sold within 12 months. Um, so you don't have to worry about the variable interest rate kicking in. And then also, they're, they're pretty easy to get as long as you have home equity, and they're often rather affordable, particularly if you pay them off quickly. So if, uh, HELOCs at the end of the day are pretty common for this, um, you only pay for the money you pull out. There's a lot of little ins and outs to HELOCs. So if you want more… I sound like a broken record. If you want another deep dive on this subject, shocking, we have another podcast episode devoted to, to HELOCs. It's episode 50, five-zero, so definitely check that one out. Now, if HELOCs aren't your thing, then another potential option, um, for you to end up not paying out of pocket for pre-listing work or really paying upfront for pre-listing work i- is, uh, I, I call them pre-listing concierge companies. Basically, they will come out and do the work for you. They function pretty much as a general contractor. The only difference is you don't pay them back until you sell the home, and the money goes, comes out of the proceeds you get from the home sale. Of course, there's, uh, some details here, like timeframes and if you don't sell the house within, let's say 12 months, you know, it kinda turns into a loan that you pay off and… But these companies, there's a couple of them, and I, I feel like this is a, a new trend. I expect more to come out of the woodwork as time goes on. They can be a nice option for sellers in a position to, who need to sell their house but wanna get some work done to get the most bang for their buck. Another benefit of these companies, these pre-listing concierge companies, is that because they function as a ge- general contractor, a lot of the stress, a lot of the weight that comes with managing all these projects and there's already so much stress. You're selling your home. It's easy to get stressed out just if you don't have projects to do. Well, these companies can alleviate a lot of that and take a lot of that weight and burden on themselves We have a couple companies that we've worked with in the past and some contractors who can take payment after closing as well. So once you have the sale proceeds, you can pay out of that. So yeah, that very handy for you as a seller to not pay upfront out of pocket.

Christian: [18:43] Yeah. Feel free to reach out to us and we can, you know, share our contacts at these companies so that you can make sure that you're getting taken care of. Um, I know that we have used these companies in the past for a couple examples. Like, one of them was an estate sale where the property needed, you know, quite a bit of work because it, you know, it, it just had been outdated, and they did a great job. And then we've done it, and that was kind of a more extensive repair, and then we've had them come out and do just very minor stuff where they, they handled the exterior painting, put some new gutters on, did some curb appeal stuff to the front of the house, replaced some flooring, like maybe not extensive, but you know, quite a bit of stuff. Um, so they really range from what you can hire them to do, uh, depending on what your house needs. And again, we can help with all of that. That's why we are here. We are a resource for you to lean on when that time comes to decide if there's anything you should do and what it is, and then how extensively you need to do a remodel based on the market. Mm-hmm. Yeah. 'Cause the worst thing that we have seen people do is spend time and money on making updates that just don't matter at the end of the day. Like, it's not gonna help sell the house, and it's just gonna cost you time and money in the process. So please, please, please lean on us. Use our expertise to help you. It doesn't cost you anything more when you hire us to lean on us for these update ideas. Um, this isn't like an added cost or anything like that. It's just an added benefit that you get for using us as your agent. So yeah, if you are thinking about selling your home or just want some help figuring out what renovations you should do, just reach out. You know our website. It's AwesomeNossumGroup.com. All of our contact info is on there. Um, we have a huge list of vendors that we are happy to share and refer to you. Um, so yeah, just reach out. We'd be happy to share. That is it for today. Thank you so much everyone for joining me on the podcast, guys. You are awesome as always, and we'll see you next time on the Awesome in Seattle podcast.

Jason: [20:50] Bye.

Nicholas: [20:51] Bye. Bye.