Real Estate Myths (and Truths) - Part I

We've all heard them over the years.  They're like those old wives' tales we grew up with and still find ourselves tossing out there as cocktail party conversation, even though we've learned as adults that they aren't entirely true.  However, in some cases they are at least partially based in truth.

So what's myth and what's truth when it comes to real estate?  Here are some of the most common.

You'll get a better deal when buying a home through the listing agent.  Buyers assume that since the listing agent will get a larger piece of the commission pie and are eager for the sale, they will cut their commission or make up an offer shortfall so the buyer will save money.  Not necessarily so.  And...the listing agent's fiduciary obligation is to get the highest price for the seller.  They must put the seller's interests above their own, and above that of a buyer who is not also their client.  As a buyer, you want to make sure that you are working with an agent who will have your best interests at heart, and a buyer's agents with superb negotiating skills can be worth their weight in gold.  That's how you know you're getting the best deal.

Don't over-improve your home for the neighborhood.  You've probably heard someone give the advice of buying the worst house in the best neighborhood you can afford.  While that also should be taken with some caveats, a home that is considerably larger or more well-appointed than all the others in the area will usually be a tough sell.  Research the most expensive homes in your neighborhood first before doing any work.  An appraiser or a good buyer's agent will be doing the same thing and that will set a “ceiling” for what they'll value the home at.  If you're still set on making the improvements or additions for your own enjoyment, at least now you will know the limitations when it's time to sell.

The first offer you get is the best.  Your Realtor may tell you this from the outset but you don't believe him or her.  In this case, good chance they will be right!  Buyers who are seriously and actively looking for a home like yours are often already in the market and will be the first to see it.  They know home values in the area based on what they've already seen.  Those buyers are likely to make the best and strongest offer.  That's not to say you should accept their first offer; you should always try to negotiate up to the highest price they will pay.  But particularly if the offer isn't far off what your Realtor told you to expect, don't think that waiting will get you a stronger buyer or more money.  Consider how much your monthly carrying costs are on the home while you wait (mortgage, taxes, maintenance, heating, etc.)  Statistically, it's been proven that the longer a house is on the market, the bigger the gap between list price and sale price.

Always paint your house in neutral colors before putting it up for sale.  Bold or bright colors are not necessarily the kiss of death when selling a home.  Calming, neutral furnishings and floor & window treatments may complement the paint colors for a beautiful, stunning effect.  Or maybe those bold colors successfully highlight a desirable architectural feature or bring needed brightness into a room with little natural light.  Consider the space in its entirety and ask for feedback from professionals such as Realtors, home stagers and decorators.  Sometimes neutral may be the best way to go, but don't automatically go running for the paintbrush.

By Gail Fattizzi, Executive Director of Westchester Real Estate, Inc., Lic. Real Estate Broker