Spring and summer are the peak seasons for attracting buyers. However, the enthusiasm to sell can easily morph into anxiety to have the property listed as soon as possible. Fear not, there is a buyer in every season. Before you rush off to list your property on the market, you should consider making repairs or upgrades that can increase your bottom line. For most sellers, the ultimate goal, of course, isn’t simply to sell. It’s to sell for the highest possible price. So you want to be sure that you have invested into the property to realize maximum profit.
For starters, you’ll want to do a walk-through and check on smoke detectors, remove visible stains on walls or carpets, invest in heavy duty cleaning, remove pet odor, and de-clutter as much as possible to show off open space. But there may be other issues you may overlook.
Most issues require a simple fix. Deciding when to address them is up to you. Since most buyers take the cost of repairs into account when making an offer, the best time to get the property in selling order is prior to listing. The parties can also agree to seller making repairs pending the contract, but keep in mind that buyers will likely take the defects into consideration when making their offer and setting a bottom line. Alternatively, the seller can give a credit towards the purchase price. This option relieves you of the responsibility and shifts the task to the buyer.
Although the take-home is less in the end, this is typically the easiest and fastest fix – buyer is happy because of the price decrease and seller is relieved of the burden.
For maximum profit potential, here are some common conditions sellers should improve or address before selling:
Remove Carpet / Polish Floors
Carpeted floors are a thing of the past. Most real estate buyers in New York have no interest in buying luxury apartments and homes affixed with carpet. The fabric gives off an old-fashioned, outdated look. The good news is that removing carpet is a relatively cheap and quick fix. In NY co-op buildings, you can typically hire the super to remove the carpet for a few hundred dollars. No board approval is necessary.
We commonly see carpeted floors in an estate sale where the owner lived in the home for several decades. We also, sometimes, see carpet installed in nurseries or a child’s bedroom for noise insulation and a safe play area. In the latter case, I would leave the carpet as is and simply have it steamed by a professional company. It may be a plus for a potential buyer who has young kids or is expecting.
The floor of a home is a detail you should spend some money on. As a real estate broker in New York, I make a point to encourage sellers, at the minimum, to remove old carpet. Wood floors won’t just make the apartment brighter and give it a modern look, but can easily up the asking price. For sellers with dull wood floors, you can take it up a notch and invest in a polish. A scrape and polish by licensed professional for an 800 square foot apartment will typically run you around $1100 -$1500.
Replace Chipped Paint
We recently listed a co-op apartment which had remained vacant for over ten years – the owner preferred it that way. It was apparent to any potential buyer that they were in for a gut renovation. It was an all or nothing situation. The seller had to gut renovate the place or sell it “as is”. The seller opted for the latter – the selling point was the location and the in-demand building. However, the question we kept running into at showings, which was very difficult to refute without retaining proper professionals, was whether there was an asbestos issue due to an abundance of chipping paint throughout the unit. There was no asbestos issue, the paint was just very old.
Although the unit sold fairly quickly to an understanding buyer, the process did not go without combatting negative annotations from other qualified buyers from the start. If your home suffers from old paint that is peeling or chipping away, do yourself favor and invest in a fresh coat of paint. You can DIY or, as with the carpet removal, if you are selling a co-op apartment, you can hire your super or porter, or you can find someone through a referral or a google search.
Visible water stains on a ceiling, walls or floors don’t leave a very good impression with buyers. Water damage can be very costly and burdensome. Prior to listing a home on the market, stains should be evaluated to ascertain the entirety of the damage and the cause of the leak. If the stain is old and the leak is no longer active, remove the stain. If the leak is ongoing, address the source and repair the problem before listing. Most buyers will not accept a credit for water damage without investigating the source and the extent of the damage.
I have come across dozens of real estate sale contracts which all contained one clear cut provision: the roof is to be free of leaks. Without visible water damage, the buyer is under no duty to inspect the roof’s condition. As such, the buyer of a home relies on the seller’s statement that the roof is free of leaks when entering into contract. If this statement is false or if you have knowledge of a defect but fail to disclose, the seller remains on the hook for the damage and any harm that arises as a result, when the defect is ultimately revealed (typically post-closing).
If you are selling your home “as is”, and the place needs a major renovation, make sure to communicate to your lawyer that the roof may also need to be replaced. Otherwise, fix the roof on your own terms before you sell or list with a New York real estate broker. This way you can obtain a few quotes and negotiate the price. If the buyer takes you to court, you’ll have to take time out from work, possibly hire a lawyer, and still pay in the end.
If wires are hanging from walls or an electrical outlet, an appraiser for the bank issuing the buyer’s mortgage may have a serious issue with this set up. There have been instances when an appraiser would issue a report but make the value subject to repairs by the seller. Once repairs are complete, the appraiser has to come back out again and issue a new report. Most banks are hesitant to approve a loan in these types of circumstances since exposed wires pose a safety/hazard concern. If your buyer is applying for a mortgage, make sure the property is appraisal friendly. Also, a bit of a side note: be sure to be present on the date of the appraisal to answer any questions the appraiser may have about the property.
Foundation cracks in the stairs of a house or brownstone or the pavement can be a liability issue that most buyers don’t want to take on. If a guest or a passerby trips and falls due to the cracks, the owner faces liability for any damages that arise. A licensed contractor can identify the extent of the damage and determine whether it merits a significant repair.
Better Sooner than Later
If you’re thinking about selling your home, you’ll want to make needed repairs before listing the property with a New York real estate broker. Waiting for a buyer to come along first may cost you as a seller. However, if fixing up the property is not feasible due to time or economics, having the home inspected by a professional and making a full disclosure of the conditions upfront to a potential buyer may prevent renegotiations, lawsuits and cancellation of contract.