Dear Monty: Selling a nice home in a distressed neighborhood
Reader question: We have a good house in a bad location. The other homes are not as nice, and people have junk cars and other stuff in their yards. We have not been able to sell. What can we do? Ashley C.
Monty's answer: Hello, Ashley, and thanks for your question, and thanks for sending me your address. I was able to see your home from aerial photos on an Internet map. You are fortunate to have some mature vegetation and trees to provide a partial shield. A risk in homeownership is the inability to control what the neighbors do; an advantage is the freedom to do what you wish on your own property. While junk cars can happen in a city, ordinances and codes are less restrictive the further out of town one moves.
Check your asking price
With most homes, there is a direct correlation between the offering price and the time on the market. When selling, most, but not all, sellers want the top end of the range of value. Some sellers are more interested in selling quickly, and price their home to be the first one to sell. Every seller’s circumstances are unique, so what you can do to sell your home depends on your circumstances. You cannot control what your neighbors do, but you can control your price.
Why homes do not sell
Every home sells. Not every home sells during a listing term with a real estate company. Certain homes are "tulip listings" - they come up every spring. Many homes sell for less, but they do ultimately sell. Here are three scenarios that cause this:
1. The listing real estate agent, who considers them-self an expert, decided what it was worth and will “go to their grave” trying to prove they were right.
2. The sellers will not accept the message they are receiving from the marketplace. The agent may convey the right message but the seller cannot hear it. Or the agent is timid, asleep or too inexperienced to know the best way to convey the message. Even in good markets, a sizeable percentage of the listings expire unsold with the current broker.
3. The home is saddled with an attribute that is undesirable to a typical consumer.
Evaluate your situation
Depending on your circumstances and the past experience of the marketing efforts with your home, one suggestion may be to reduce the price. Two key questions to ask the agent are: At what asking price would our home be certain to attract prospects? At what price can you guarantee the home will sell? The agent cannot offer a guarantee, but can research the MLS for recent comparable sales in other neighborhoods with homes in poor condition and junk cars and deliver an answer. You may not choose to sell your home for that price, but the information may be very helpful to have in your knowledge bank. In most circumstances there is a price at which your home will sell very quickly.
Have you looked at switching agents? Is the problem your agent's real estate company? Even if the agent believes they have done everything possible, is it possible their plan is ineffective? There are many homes sold every day around the United States where the neighbors have lesser homes and junked cars in the yard. If you have to sell the house, and sell it soon, the right price and the right plan will produce results. Here is an article about "How to choose your real estate agent," and another titled the "Ten best tips for home sellers."
An important piece to this puzzle is utilizing an agent that understands what the range of value is, and what steps to take to discover it. The range of value is the best you should expect and the least you can expect in a sale.
Other potential options
There are longer-term solutions if there is time. The junk car syndrome also affects other homeowners in the neighborhood. Organize them and attempt to convince the town to upgrade codes to include "NO JUNK CARS." Try to educate the offenders. They do not realize they are hurting themselves and their neighbors. How about a cleanup, paint-up, fix-up summer? Google “before and after photos.” Some communities help support efforts like this financially.
Richard Montgomery gives no-nonsense real estate advice to readers most pressing questions. He is a real estate industry veteran who has championed industry reform for over a quarter century. You can ask him questions at DearMonty.com.