Sell Your Austin Investment Property and Get TOP DOLLAR

So you’ve decided to sell your Austin investment property. There are a number of reasons you might be considering this… you’re tired of dealing with tenants, you are moving the money into other investments, it’s time to retire, it’s time to pay for your kids college or you think the market will bust soon and you want to sell at the top. (Call me if you think the last one is true… I would love to hear your reasoning). Either way, it’s time to sell. Here is my list of the top 5 things to do to ensure you sell for top dollar.

Get the tenants out of the property.

Out of all the advice I have, this is the most important to ensure you get top dollar. TENANTS ARE DEAL KILLERS. Their motivations are typically not in line with yours, they have ugly stuff, they don’t clean up and they make the property hard to show. In short, THEY WILL COST YOU MONEY.

Let’s do the math.

The average rent a tenant is paying in Austin is $1,849/month over the last 90 days.

Getting a tenant out and making the house market ready will net you another 1-3% more than if they were in the property. If the average homes sells for $357,859 in Austin, that is potentially another $3,500-$10,500 you are leaving on the table. Between the median days on market at 29 and the average days on market at 55, you’re talking about one or two months rent that you would possibly be missing out on.

You have to put yourself in the buyers shoes… tenants legally have a right to request 24 hours notice for all showings. This right there makes it really hard to show the home. More than likely they won’t be cleaning up, sometimes tenants don’t even leave the property. As a Realtor, try getting professional photos of the home with tenants present. It’s next to impossible.

Now I know this isn’t always the case. I have had some really great tenants who keep the house nicer than I keep my own. If properly motivated---guaranteeing they can keep their deposit, even paying them to work with us on showings, can create a win-win situation. I just wouldn’t count on it and I don’t think you should either.  

Get the Property Market Ready

Depending on your budget, you need to be prepared to spend some money getting the property ready for the market. Depending on how long your property has been a rental and how proactive you have been maintaining it will determine your budget.

The first rule is, your tenant’s deposit is only for damage caused by your tenant. Don’t use their deposit as your updating budget. Getting carpets cleaned, air filters changed out, etc are perfectly fine. Replacing the carpet with hardwood floors on their dime is something you could potentially get in trouble for.

Now that we’ve got that out of the way, let’s do a quick run down.

You have a $1k budget:

Do a deep clean of the property--carpets, baseboards, windows.

Have a handyman come in and make minor repairs and paint touch ups.

Get the yard under control and do some light landscaping.

Tune-up HVAC and any other appliances that may need attention.

If you can spend $2500-5000:

Paint the house--possibly inside and out

Consider replacing flooring. If you have to choose which rooms, always start with the living rooms, before moving on to the master bedrooms and then the other bedrooms, baths, etc.

Big Budget of $10,000 to $25,000:

This is where I would consult a professional. If the home is really outdated and/or needs a lot of work, it might make sense to do a more major renovation. I really like the National Association of Realtors Cost vs. Value Report here as a guide for best ROI projects.

However, my list would be the following:

1. Scrape ceilings and get that popcorn texture out of the home.

2. Curb appeal is huge. Make sure the front of the home pops.

3. Get the kitchen updated. On this budget, doing the countertops, backsplash, sink and new fixtures is best. You can always paint the cabinets and put on new hardware to freshen it up.

4. Faux wood tile is a huge hit right now for flooring. It’s easier and cheaper to install than real wood. Another alternative I would consider is a high-end laminate. They make them now that are very durable and don’t make that strange popping noise when you walk on them.

5. Updating light and plumbing fixtures is inexpensive and goes a long way. I would also consider changing out all the electric outlets for an easy refresh.

6. My last item is windows. If you can stretch it, new windows means you care about who is buying the home. They are aesthetically pleasing and will save the buyer money on their electric bill.

Additional resource: Tips and tricks for finding a good contractor

Price it to Sell

I know that everyone wants top dollar right now. It is a seller’s market and the entire reason you might be considering selling is to take advantage of that. The biggest mistake you can make with selling is over-pricing the home.

It is logical to think that if you price it too high to start and no one is willing to pay what you are asking, a simple price adjustment will do the trick. Sometimes it does. However, if you sit on the market too long and right now, I think 6 weeks is too long, the property will develop a stigma. Instead of buyers coming in and being excited about the home, they are looking for reasons not to buy it.

On the flip side, I would not be worried if you didn’t get an offer the first week or two on the market. I’ve had properties sit on the market for a few weeks and then get multiple offers. Sometimes it is good to price it slightly higher and be patient.

This all feeds into my last point at the end of this article regarding hiring a pro. The right agent knows that real estate is hyper-local and every neighborhood has different market tendencies. Make sure the agent you hire to market your home understands the area your home is in. More on this later...

Staging/Styling the House

Buying a home is an emotional experience. You want a buyer to connect with the property, feel like they can live there, start a family there and so on. We firmly believe that staging a vacant home can increase the selling price by an additional 1-3%. Above you will see a home that was on the market for months and didn't sell (top row of pictures). Below is the exact same house that was staged by BIRDHOME and sold the first weekend on the market.

The average buyer CANNOT imagine themselves living in a home. You have to curate that experience for them. Staging does come with an expense and you can decide to do some very light “vignette” staging or you can stage the entire house. I really prefer homes that have the living room, dining room and master bedroom staged. The other bedrooms can sometimes be small to start and can feel smaller with furniture in them.

Additionally, when you have the home staged, it makes the professional photography so much better. It gives the photographer a point of view and helps guide the buyer through the home visually online. And since 99% of buyers start their home search online and decide whether or not to even look at a home in person based on their perception of the home online, this is crucial.

Need help staging? Click here. We offer complimentary staging to our sellers and help other Realtors stage on a case-by-case basis.

Hire a Professional REALTOR

I am going to keep this last point short and simple. I am a firm believer in hiring professionals and paying them well for their services. Anytime I have ever gone for the lowest bid or cheapest alternative, I have paid for it dearly. I know this may come across as self serving, but I can’t help it if it is true.

That being said, here is our guide to interviewing real estate agents. If there is another thing that I stand by, it is interviewing more than one agent for the job. Most people think that all Realtors are created equal. I challenge you to interview more than one to three agents and you will be surprised at the varying levels of professionalism and services they offer.  

I still stand by my first point that getting the tenants out will net you the most amount of money when going to sell. Hiring a professional real estate agent to help you navigate preparing the home for the market, determining an asking price for the home, properly marketing your property and negotiating top dollar is a very close second on that list.

Call us, text us or connect with us on social media to get your home sold today.

Additional resources:

Wondering if it is time to sell your investment property? Here is an in-depth analysis.

Interviewing real estate agents? Here is what to ask.

Staging/styling help: Click here

Need help fixing up the house? Tips and tricks for finding a good contractor

IN CONCLUSION:

1. Get the tenants out of the property.

2. Make the property “market ready”.

3. Price it right.

4. Stage/style the home.

5. Hire a pro.

It’s time to file your Homestead Exemption

Happy New Year and welcome to 2017!!

Thank you for being a part of BIRDHOME in 2016 and buying a home with us. We want you to start off 2017 on the right real estate foot by filing your homestead exemption form so you can SAVE MONEY on your tax bill at the end of the year.

Depending on the price of your home, filing this exemption can potentially save you thousands of dollars per year.

Who should apply?

You! If you bought a home in 2016 and it is your primary residence, the time to apply and save is now. The deadline to apply is anytime between January 1st and April 30th.

How to Apply for a Homestead Exemption

Below are a list of counties where we sell real estate. Depending on where you live, you will download and file differently.

Travis County Appraisal District

Mailing Address: P.O. BOX 149012, Austin, TX 78714-9012

Williamson County Appraisal District allows for Online filing

Mailing Address: 625 FM 1460, Georgetown, TX 78626-8050

Hays County Appraisal District

Mailing Address: 21001 IH 35 North, Kyle, Texas 78640

What you will need to file

Besides filling out the form and sending it in, you will also need to send a copy of your Texas driver's license and the address must match the homestead address.

Cost of filing for a homestead exemption

There is absolutely no cost associated with filing your homestead exemption. You will get mail from third party vendors offering to file your exemption for a fee. Do not pay them to file for you.

Resources

Texas Comptroller’s FAQ

Texas Property Tax Exemptions Tax Code

Other Exemptions you can potentially file for are here.

As a quick recap….

(1) If you bought a home in 2016, and

(2) it’s your primary residence as of January 1st, 2017, you can

(3) apply for a homestead exemption with your county appraisal district.

(4) The deadline to file is April 30th, 2017 and

(5) you will need to include a current Texas driver’s license or ID with the address matching the homestead address.

(6) The cost associated with filing for the exemption is ABSOLUTELY FREE.

Selling Over the Holiday Season

Historically, December is a better month to sell than the rest of the Fall or Winter, which is generally considered part of the "slower" season in real estate. There are a few reasons why this is the case and why it might be a good time to consider selling your house around the holidays. We also have a few tips and answer some often asked questions that you should need to know about if you are planning of selling during this time. And be sure to check out Patrick on Fox 7 below as he shares his tips for selling during the holidays.

Serious Buyers Only

This is one of the best parts about selling in the "slower" season - you're really only going to attract serious buyers. While this can seem like a bad thing it is far from it. This means that the buyers you get are extremely motivated to move on a house and they aren't as finicky and flaky as some spring buyers can be. Beyond this there are some specifics that make December a great time to sell if you are willing to play it right. 

December Buyers are usually some combination of this:

• People that are relocating for jobs. There are lots of people that are relocating around this time of year and have a strong need to buy. They are usually under a time constraint and are looking to buy fast. 
• People with a little extra cash to spend. This is the time of the holiday bonus; large cash bonuses get paid out when companies do well and this usually happens around the holidays. This means that there is a good chance that buyers have a little extra cash to use for that downpayment. 
• People with time off. In December you have 2 weeks of downtime that you just don’t get any other time of the year. That means people who are looking to buy have a larger window of time to look and want to visit and see more houses.

Low Supply 

December is historically one of the months with the lowest number of houses on the market. In December of 2015 there were just under 8,000 active listings on the market in Austin. For the months of May through September there was over 11,000 listings. That is 3000 less homes available to buyers in December than in the Spring. What this means is that there isn't a lot of competition from other sellers. Additionally as we detailed above the buyers are more motivated during this time of year, this can lead to low supply and high demand - which is always beneficial to the seller. 

The Election

Now these reasons are general to most Decembers, however its important to remember that some effects are specific to certain years. For this December we just went through a very contentious election that had a lot of people on either side concerned. And traditionally when people are concerned about jobs or the future they are less likely to spend money, especially when it comes to something like a house. Now that the election is over we can expect a bit of a bounce back and some people who were thinking about buying in November but didn't, start their search up again. 

Best practices for marketing/selling:

• Should I/should I not put up holiday decorations?

  • Yes, but keep it tasteful, don’t go overboard. It can create an emotional connection for the buyer as well. Still want to declutter/depersonalize.

•  What do I do if someone wants to see my house on Christmas?

  • Yes. Only a very motivated buyer wants to see homes on a National holiday.  

• Pictures of the home during winter should be done sooner than later before the leaves change and before decorations go up. 

Love It Or List It? A BIRDHOME Recap!

SHOULD I LOVE IT OR LIST IT?

We had the joy of participating in an amazing event last night with the incredible Amity Worrel & Co. that we just had to share with you! Over the past few month they have been putting on their Design 101 events to help share professional advice on interior design, architecture, and real estate amongst other things. We were ask to contribute to their Love It or List It event last night and it went so well that we decided we need to share some of the knowledge and advice from the event with you! So read our recap below and be sure to check out the three amazing ladies that we had the pleasure of speaking with last night: Amity Worrel, Dianne Kett, and Maureen Hodges. They are inspirations to us and we can't recommend them enough!

1. Make a list of what you love and what you don't love!

Even if you think you already know you want to renovate your house, its always good to go through and make a list of everything you love and don't love just to make sure you don't miss anything. And be sure to include things beyond just what is in the house itself, consider the neighborhood, neighbors, commute, and location as well! This will help you narrow down your list to the things you can change versus the things you can't and you can decide if you can just renovate or if you need to sell and something different.  

2. Talk to an interior designer and architect

Once you have your list of what you love and don't love you can talk to an interior designer and/or an architect to get their opinion on budget and feasibility. A good general rule is that if you are just changing the setup of a room its okay just to reach out to an interior designer, but once you start talking about moving walls, changes plumbing or electrical, or adding on the house you'll need the knowledge and expertise of an architect as well. And any good interior designer will help you find one that you can trust! So make sure to reach out to them early and often - they are always will to help and get you moving in the right direction.  

3. Decide - Love it or list it!

Now that you've talked to an interior designer and an architect its time to make that decision. Are you going to love it or are you going to list it.  Maybe the architect comes to you and tells you that you can't add a second story or there is a heritage oak preventing you from extending that porch. Or maybe the budget and time just doesn't work for you. Or perhaps everything lines up perfectly and you're ready to move forward with making your house into a dream home. Either way - you'll be confident that you've got all the information to make the right decision for you!

4. Run the numbers

Either way though, once you've decided on what you're going to do make sure to reach out to a trusted real estate professional. Because a good agent will help you run the numbers. As we tell people all the time, buying or selling your house is a business transaction so its important to treat it like one. We can provide a valuation of your house currently and then what it would be after you renovate. If you are going to sell, we can help you through the process to make sure you can get top market value for your house. So don't hesitate to reach out to us, we understand that while this can be a very emotional moment it is also a very important financial one as well. 

5. Think Like a Buyer

So once you've decided to sell and interviewed and hired your real estate agent its important that the goal of selling your house becomes the priority. And the best way to do this is to take it from being your home to becoming a house that someone else can turn into their home. We always recommend to our clients to run through our Seller's Checklist and start to think like a buyer. The easiest way to do this is to have a stager come in and make your house appeal to potential buyers, they can remove the emotion from the process of selling your house and make it so much easier for a buyer to imagine and dream of living there. This is such an important part of selling a house that we started our own staging company!

We hope this helped you as you consider remodeling or selling your house and if you have any questions please don't hesitate to reach out to us or the wonderful women that spoke (we'd be happy to connect you as well). And if you're interested in attending the next Design 101 class be sure to sign up to be on Amity's mailing list!

Why You Should Buy In The Fall

It's no secret that Austin is considered by just about every metric to be a strong seller's market right now. In our most recent market report we shared that for August there were 2.8 months of inventory within Austin and balanced market is considered to be 6.5 months of inventory. This just further confirms what we all know - it's great to be selling your home but it can be difficult if you are looking to buy. However if you are looking to buy hope is not lost, we've got a few tips that can help you get the house that you want for the price that you're looking for.  

Currently there 2,519 homes on the Market in Austin, with another 4,874 are listed for sale in the surrounding areas. That is 5% more homes on the market than there were last year. And 958 of them are new construction homes.  Within the last week, of those homes on the market, 404 have lowered their price, 49 homes fell out of contract and came back on the market and about 90 homes came off the market (either withdrawn or expired). This creates an environment that can benefit a smart buyer. 

Here are four reasons it can be better for you to be buying in the fall:

 

Less Competition

Most homes sell in the spring and summer months. Everyone clamors when new houses come on the market during those months and all that competition can make it harder get an offer accepted, or even submit an offer in the first place. This past spring we saw it was quite common that buyers had to submit an offer immediately after the house when to market if they wanted a realistic shot of getting the house. With less buyers crowding the playing feel you've got opportunity to really search for the home of your dreams without worrying it will get snatched up immediately.

Serious Sellers

 There are generally two types of sellers in the Fall, those who's homes went to market in the spring and summer and then sat until the fall or those who have to move out immediately, either because of jobs or family or something similar. This means that most sellers are seriously movtivated to sell. They aren't just testing the market or seeing what's out there, they need to sell and this is to the buyers advantage. 

Negotiating can be a little easier

Now can be a good time to make lower offers to see if the seller will accept them. The average sale in Austin goes for 98% of the asking price. Based on a median sales price of $289,990, that’s an average of about $6,000 of the seller’s asking price.If you can negotiate the seller’s another 1-2% off of that, that translates into a savings of about another $3,000 to $6,000.

Sellers who have been on the market for awhile are more ready to deal    

Of the 2600+ homes in Austin currently on the market, the average days they’ve been on the market is 88. This is double the normal average days on market of 40.  It’s a great time to negotiate for that dream home or that smart investment property purchase.

We hope this post has shed some light on some of the advantages that buyer's have in the fall. Be sure let us know if we can help you out with your home search or if you want to talk about any of the topics we've talked about in this blog.