Archive for October, 2009

Home Staging – The Schaefer Synopsis

I am sitting at my computer right now in a hotel room staring out at one of the biggest shopping mall parking lots I have ever seen with “Macy’s” in lights. Sounds a bit like the Vegas version of Macy’s, I know. But, what Vegas doesn’t have, is the ocean and palm trees on the other side of the parking lot in plain view of my hotel room balcony. Because of this, I am willing to overlook the mall parking lot.

You guessed it; I am in Hawaii, having just spoken at the 1st annual Hawaii Real Estate Convention. Before I came here, I did some research on the market since I never like to show up unprepared and every single market has its own special needs and trends. I feel as though it is also my job, to show up informed and am surprised when others don’t.

When I looked at the market here, I found that the main island (most of the statistics are on Maui and Oahu) was down in sales from last month to this month by 30.6% and down 10.2% for the year. They still experienced mild appreciation of 1-2%, but that is mild compared to the 85% appreciation they have had over the last 5 years. Yep, you read that right, 85% appreciation!!!

As these numbers came up, most of the people in the audience, all from Hawaii, were surprised. They knew their market was not doing as well as it had been, but they were not prepared for the reality. You see, many of these investors were used to buying on appreciation as were those in California, Las Vegas and Arizona. The Hawaii market just didn’t “crash” like the others mostly due to better lending practices, but still, the appreciation they have come to rely upon, virtually came to a standstill. Unfortunately, if you don’t know when to get in and when to get out, buying on appreciation hardly ever works. I know dozens of real estate investors that got rich quick, and lost it all even faster because of two factors:

1. They did not track their market and watch the numbers and trends
2. They bought on appreciation.

I think you all know that if you were lucky enough to buy on appreciation and make a bunch of money and keep it—you were just that—lucky. Your better and safer bet is to buy on cash flow, which is now the name of the game.

Watch all the real estate investor guru’s advertising. Instead of the “Get Rich Quick in Real Estate” advertising that they have been doing for the past several years, now they are telling you about “Safe, Long Term Wealth Building.” Mark my words, I can see the trend coming…because I am tracking it and you should be too.

So, other than bragging about the fact that I am in Hawaii, my point is that you are the only one responsible for your business and you need to keep an eye on it. Despite what all the experts are saying, the market is volatile and you should be watching it.

Make sure you have plenty of margin in each deal, not “just enough.” If you are planning on making $15,000 or less on the deal, unless it is an assignment or a wholesale deal, that is not enough margin to protect you if things take a serious dip unexpectedly.

You may still make $15,000 which is good, but you need to plan on making $25,000.

A great way to track trends in your area is simply by doing a Google search on “Your Area Real Estate Statistics” you will find dozens of sites that are local and specific to your investing farm area. If you are looking for demographic info, go to www.city-data.com .

The other thing you need to keep an eye on in the next several months in addition to the market, is of course the elections. I will save my comments on that little nugget for next month, but yes, it will affect your business, so get prepared for the long run. Buy low and sell FAST.

About the Author

Karen Schaefer is an Investor, Writer, Speaker and Property Designer. She is the founder of Simple Appeal, Inc., the Premier Nationwide Staging and Design Company as well as APSD, The Association of Property Scene Designers. She is known nationwide as the Expert on selling properties in ½ the time at full market value. And for helping Home Stagers and Entrepreneurs create seven figure businesses. If you would like to learn more about Home Staging, Curb Appeal, Real Estate Marketing and Selling, go to www.APSDmembers.com
2009
10/29
CATEGORY
Real Estate Success
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Home Staging Tips – Using Furnitures to Stage Homes

Furniture seems to be the bane of existence for many people trying to unload their houses. How much do I need? Do I need it at all? If so, where do I get it? Do I have to buy it? The questions go on and on. It never fails on each and every Wednesday morning tele-coaching call to my VIP students, someone asks me about furniture.

So today, I want to address the infatuation, or lack thereof with furniture in regards to staging.

I rarely use furniture in staging, not because I don’t like it, but I think more often than not, it is unnecessary. The reason that most staging companies use a lot of furniture is because they don’t understand who their customer is and the difference between selling vs. decorating. Yes, I realize that comment may make some of you angry, but my job is to help you sell your properties and continually learn more about the real estate industry on the whole, so there you go. I can tell you that most stagings we do as well as nearly all of our Property Designers yield fantastic results with very little furniture.

Let’s first discuss when you need to use furniture. Generally in very large rooms or very large homes, you will need some furniture. Or if you are trying to make an odd space work, you might also need to use furniture. Finally, furniture can also give people directions in the house. In other words, you can use furniture in such a way that it creates flow and helps to guide the potential buyer thru the home in the way that you wish them to view it.

In large rooms or even in large homes, sometimes you will need furniture since you need to fill a larger space. What I see people try to get away with are really small accessories in a large room making the room look bigger which is not a bad thing, but the downside is that the staging items look puny—which is never good. In an over large living space, some good and easy furniture items are chaise lounges placed in the middle of a room at a diagonal on a rug with the appropriate décor or a couple of arm chairs with a great coffee table works too. The arm chairs and coffee table depend on the home, but of course, many variations of this will work. You can do anything from Wicker chairs and wicker trunk to leather arms chairs with a tufted oversized leather ottoman.

The other clever pieces of furniture that I like to use are sofa tables. These are great tables when you need a dining room table but don’t want to bother with an enormous dining room set. Basically, you can take this long sofa table, place it in the center of a rug that should be centered under the dining room light fixture, put a great table runner on it (this can be an easy Pocket of Emotion, by the way, so pay attention to your table runners) and then adorn it with multi-colored wine glasses, interesting place settings or a unique center piece. You have an excellent opportunity to fill the space, add something unexpected, and not break your back or your budget by trying to move in a huge dining room set. Just a little tip—even a homemade table with a floor length table cloth will work and then just do the same thing we mentioned above.

The last few pieces of furniture that I do like are oversized bean bag chairs for kid’s rooms as well as basements and small tables that have a multi purpose. They can be used to collect keys at a front door, for art or plants, or to hold a Pocket of Emotion. You can also use them to suggest a desk or a table in a breakfast nook, so I always keep an eye out for pieces like this.

Okay, so if you need furniture, where do you get it? Well, you can go to all the logical places, like your own home, good will, the discount stores and the rental stores. If you buy it, no problem, just make sure you know what to do with it when the house sells. If you rent it that is fine because usually they will absorb the liability if it is damaged or you will at least know the terms if it gets stolen or damaged, all of which is very unlikely. The third option you have is to negotiate a deal with a furniture or décor store. You will use their item at no charge but they get to advertise at no charge. It is a win win situation except for pick up and returns—and damages. These things can put you in a tough spot so make sure you go into this arrangement with your eyes wide open.

And of course, many of you already know my trick to create instant beds with blow up mattresses, milk crates and plenty of comforters. You will also need a roll of duct tape to shorten the length of the bed skirt, from the center. Make sure you have a full sheet set, at least 3 decorative pillows and at least 4 regular pillows. You will also need 2 comforters or duvets and inserts to give it a rich and lush appearance.

So, as you can see, furniture is not hard to come by, but generally speaking you don’t need it or don’t need a great deal. There are always exceptions to the rule and for those, I recommend that you give us a call.

About the Author

Karen Schaefer is an Investor, Writer, Speaker and Property Designer. She is the founder of Simple Appeal, Inc., the Premier Nationwide Staging and Design Company as well as APSD, The Association of Property Scene Designers. She is known nationwide as the Expert on selling properties in ½ the time at full market value. And for helping Home Stagers and Entrepreneurs create seven figure businesses. If you would like to learn more about Home Staging, Curb Appeal, Real Estate Marketing and Selling, go to www.APSDmembers.com

2009
10/27
CATEGORY
Attracting House Buyers
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Home Staging Tips – How to Properly Clean and Stage Your Home For Sale

Have you ever seen a MR. Clean commercial?  Isn’t he clean?  Don’t you wish he would just come over and take care of all of your properties for you?  Some big shaven headed one earring wearing really clean guy all in white—you got to love it. There has to be a song in there somewhere.

My topic today though, is cleanliness—you know who it is next to!

Sellers, Agents and Investors will do one of two things.

1. Not realize their property is dirty because they have been living in it for so long that they just don’t see it.

OR

2. They will have it cleaned once in the very beginning, but not ever again.

When people walk into your property, they can feel the dirt.  Yep, you can feel it, not to mention seeing it, which most of the time you can do as well.  Even though we joke about investors looking for really dirty properties, the truth is, unless you are a conditioned wholesale buyer, the dirt will turn you off completely.  So, just to be on the safe side, let’s always deliver a “Mr. Clean” property.

Most people think clean can be subjective, but it really is not.  Below, I have listed multiple steps that you need to take in order to keep your property spotless clean while it is on the market, which incidentally, will be a far shorter time than if you are showing a dirty house.

Last month I discussed Curb Appeal in this column, so please refer back to it in order to know what to do on the exterior of your home.  Suffice it to say, your shrubs should be trimmed, papers picked up, grass mowed, driveway shoveled and all debris or garbage removed from the lawn.

Interior Cleanliness

1. The main entry should be spotless. When you stand on the door step and get ready to go inside, make sure that the entire area is free from grass trimmings, spider webs, and dirt—this is the impression they will take inside.

2. Once inside, look up.  Are all of your ceiling fans clean?  I am talking about the blades, bulbs and globes.  Look at all light fixtures in the same way.  Bring a ladder and feather duster, prepare to remove the globes if necessary and wash them.

3. Change out your light bulbs.  Bulbs often lose their intensity anyway, so it is best to change them out.  If you decide against this, only clean bulbs when they are very cool to the touch otherwise they will explode.  Do not use any harsh ingredients (I prefer cool water and dish liquid or water and lemons). Otherwise, when you turn the light on, it will burn the cleanser and put off a harsh smell.

4. Look at all the window coverings in the house.  They need to be cleaned or even replaced if they are not easily dusted.  Often you will find window coverings that have been damaged by smoking, long term dust build up or cooking splatters in the kitchen.   Your customer is always drawn to the window, so make sure they enjoy the view.

5. This brings me to the window itself.  Remove the screens as they never look clean and put them in the garage.  Clean the windows inside and out, and not while the sun is shining on them or they will streak.  I prefer to use Binswanger for windows which is normally used on automotive replacement windows.  It is the very best I have found, but you must wipe it completely dry.

6. Don’t forget the window sills while you are there.  How many dead bugs can you count on a window sill is not a fun game to play when you are looking for your dream home.

7. Walls and floorboards are overlooked time and time again.  These areas are so easy to clean once you have done it right the first time.  All you have to do is to pull out your feather duster and zip over all of them.  If they are really dirty to begin with, my favorite cleaning tool for these areas is the Mr. Clean pad.  It not only washes off grime, grease, smoke and dust, but they even get rid of crayon and other marks.

8. Do I really need to discuss bathrooms and kitchens?  It is so important that you hit all the major components in these rooms.  Lets first talk about the bathroom.  Clean and scrub the toilet, top to bottom and close the lid. You need to scrub it at least once a week, same with the tub and sink.  The tub may have dead bugs, so keep an eye on it.  Don’t forget to wipe down the vanity and floor and take a peak inside the medicine cabinet for old vitamins, hair, and other not so appealing “left overs.”  If your tub is stained, the best solution is warm water and witch hazel.  Then I cut up a few lemons, let them soak in the solution and use them as my scrub brushes.  It turns out beautifully white and you get a fresh lemony scent instead of a harsh chemical one.  Finally, make sure your bathroom is smudge free on the knobs, mirrors and water fixtures.

9. The kitchens are treasure chests for hidden bundles of dirt.  Obviously, the things we have already mentioned apply, but have you really cleaned your appliances.  Run your dishwasher while it is empty and use a jet dry tab to really get it clean.  Remove the shelves and drawers from the refrigerator when you clean it so you can really get all the gunk out.  The outside of the fridge needs attention too—obviously the front, but down below by the grill too.  Replace the drip trays on the stove and cut the grease!  Don’t forget the fan as it is always dirty inside and out.  Finally the sink.  Get the edges and the drains.  These are areas that are always missed and yet very visible. 

Finally, give the water faucet a great shine and make sure it is clean all the way around.

Next month, I will finish all the cleaning tips on houses, that nearly everyone misses yet will hinder the sale of your home if you fail to do them.

I would recommend that you do what we do and have a maintenance crew, or just use ours or one of the crews from our Property Designers. They will maintain the yard, shovel snow, pick up papers, adjust the staging and clean as appropriate.  That way, you don’t have to worry as it is picture perfect every time.

About the Author

Karen Schaefer is an Investor, Writer, Speaker and Property Designer.  She is the founder of Simple Appeal, Inc., the Premier Nationwide Staging and Design Company as well as APSD, The Association of Property Scene Designers.  She is known nationwide as the Expert on selling properties in ½ the time at full market value. And for helping Home Stagers and Entrepreneurs create seven figure businesses. If you would like to learn more about Home Staging, Curb Appeal, Real Estate Marketing and Selling, go to www.APSDmembers.com
2009
10/25
CATEGORY
Tips of the Month
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Staging Your Home – How To Sell Fast

It seems as though it does not matter where I am, people are saying the same thing.  “How do I sell my houses?’  I was just in St. Louis last week and as I was giving a one day seminar, the biggest concern was the increasing days on market, currently up to 180!

Nearly every investor in the room was sitting on properties and you could almost feel the pain in the room.

Last week I had an investor from New England call about 2 investment properties in Florida and he was upside down by $40,000-$60,000 on both!

My heart bleeds for these people.  Not just the investors, but everyone that bought too late and is trying or needing to sell too early.  Real estate is not for the faint of heart and you should definitely make sure that you can lose before you begin.

I think so many people see others out there making large profits on real estate investing.  What they don’t see are the times they experienced large losses.  I have only lost twice, one time it was just a few thousand, which did not hurt too badly, but the second time, it was nearly $100,000 which I could definitely feel in my pocket book.  That one is a long story but, you can be sure that I made multiple mistakes, trusted all the wrong people, and eventually, when I decided to get out, felt as though it was the best $100,000 I ever lost.  Don’t get me started.  The money did not hurt nearly as bad as the loss of the relationships involved.

My point that I am trying to make is that real estate is not a sure thing and many people are losing right now.  You should not be buying above 70% LTV period.  Real estate is going down, not up and it is not even staying flat.   As a matter of fact, it went down 8.5% last quarter which averages out to be $19,600 per house!  So, each day you hold on to your house, you are losing money.  On average that amounts to $91.65 a day.  If this does not frighten you, it should.  Days can add up fast and if you are in the national average of DOM that means you will sit on your house for 163.7 days.  That totals to just under $15,400 in holding costs alone!  Are you willing to lose that much?  Plus, while you are holding, your house is going down again.

The chances of you selling at full market value right now are very slim because no one can really define what that is.  With a market that is dropping on a daily basis, you must make sure you are accounting for the right price in the beginning or you will hold in the end.

The sexiness of the big payoff with a fast sale is, at least for awhile, gone.  Now, you have to really pay attention to your numbers.  As I said, I would look at a maximum purchase price as an investor of 70% LTV and then I still want to make sure it can be made unforgettable so I can sell it fast.

So when you are out there now, getting ready to list, sell or even buy, make sure you run the numbers.  You must buy low enough to hold for at least six months if needed.  Make sure you account for the prices dropping on the property and that you are solid in having multiple exit strategies in case it just does not sell or rent.

One of the biggest mistakes made by most investors is the lack of multiple exit strategies.  One of the biggest mistakes made by brokers and agents is over pricing in the beginning.

Both of these mistakes can be deadly in the final sale of the home for the investor, agent and seller.

One of the only few appreciating markets left is Seattle and of course small pockets in various other locations throughout the country.  For the most part, the market has stopped or is declining.

So what is the solution?  Buy right and learn to sell.  All the best paperwork in the world does not help you if you can’t get someone to fall in love with the property.

Remember, according to nearly every financial expert, the markets will decline steadily for the next 2 years.  So, if you decide to hold, get the best possible tenant buyer or renter by giving them a property they love…hopefully they will keep it that way. If you decide to sell, buy low and make each property unforgettable.

About the Author

Karen Schaefer is an Investor, Writer, Speaker and Property Designer.  She is the founder of Simple Appeal, Inc., the Premier Nationwide Staging and Design Company as well as APSD, The Association of Property Scene Designers.  She is known nationwide as the Expert on selling properties in ½ the time at full market value.  If you would like to learn more about Home Staging, Curb Appeal, Real Estate Marketing and Selling, go to www.APSDmembers.com
2009
10/23
CATEGORY
selling homes
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Home Staging – Why Are Rugs So Great?

This month in the Staging Report I want to talk about something so exciting, you will hardly be able to sit and read this at the same time.  No, you will jump for joy, scream at the top of your lungs and no doubt, run naked thru the tulips.  What could possibly be so exciting?  Rugs.  I know what you are all thinking, that I definitely need to get out more, and yes, I do realize that, but please, hear me out on this one.

Rugs are probably the single best staging item you can get.  That is why I generally will pay more for a better one, so I can use it time and time again.  Why are rugs so great?

Well, you can use them to add color to any room.  If possible, I even drape them from a wall or over one wall into the next room.  They also carry, color throughout a house.  Your rugs don’t all have to match, but if you can match a color or two in each rug from one room to the next, now they have the appearance of all going together.  The best general color choices are to start with a neutral pallet and then have color or pattern added from there.  Try to look at rugs with either a neutral border or a neutral center, and then you will always have the option to coordinate with the opposite pattern.  One thing that I find continually is that people want to add heavy design in small houses.  Although you can and should have design on your rugs, unless the house is huge, it should be kept to a minimal.  If you can see a rug from a rug, in other words, the rooms are open to one another; you must make sure the rugs coordinate.   This not only makes it more aesthetically appealing but when you go to use those rugs again, they already match, so you are one step ahead of the game.

Rugs also allows for a sense of flow from room to room.  You are literally directing people to go from one room to another with the simple usage of rugs.  They look for a direction to follow and are rarely given one.  But, the use of rugs literally shows them where to go next.  Watch people next time they go in and out of your property, they will almost always go toward the area rug, then walk on the runner to get to the next area rug.

The next benefit of rugs is that they help you with theme and continuity.  You can decide on a theme for a home, such as rustic, mountain, trendy, or even fresh or traditional.  Your rugs, by choice of color, pattern and texture can help you to maintain that feel.  Since I live in Colorado, a common theme here, obviously, is mountain home.  Now I am not a big fan of going overboard with this but by simply using a few good rugs with a neutral border, rich colors and a simple southwest mountain look, now I can add a sheep skin rug in the master and I have coordinated the entire theme, while still adding lots of texture, color and uniqueness.  Now, I don’t need to add tons of accessories that accent my theme.

Obviously, a rug can fill a room which is great, but the best use of them is to help define a space.  A properly placed rug can define 2 spaces in one room such as a living room and dining room or even in an unfinished basement; you can show someone how they could finish it by separating multiple areas with different rugs, such as a home office from a play room for the kids.

Finally, rugs allow other people to get a better sense of the size of the room, and they can mentally begin to place their own furniture and items around the rug.  It truly gives them a sense of the room, which is vital for them to “move themselves in.”

So, in a nutshell, why do I love area rugs?

1. They create color, continuity, theme and flow throughout a home
2. Rugs can fill a space and make it seem warm and inviting
3. When you use good area rugs effectively, they will define spaces giving your customer a sense of the size of the room and space available
4. Now your buyer will mentally start to place their own items in each room on and around the rug.  They will purchase the property faster and you can go to your next house faster.

Rugs are a beautiful thing!

Now you can see why I am such a huge fan of rugs.  I tend to carry about 200 at one time in my staging warehouse.

About the Author


Karen Schaefer is an Investor, Writer, Speaker and Property Designer.  She is the founder of Simple Appeal, Inc., the Premier Nationwide Staging and Design Company as well as APSD, The Association of Property Scene Designers.  She is known nationwide as the Expert on selling properties in ½ the time at full market value.  If you would like to learn more about Home Staging, Curb Appeal, Real Estate Marketing and Selling, go to www.APSDmembers.com
2009
10/21
CATEGORY
Attracting House Buyers
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