Maintained Homes Sell for More While Bad Neighbors Cost You
an article by Wall Street Journal's Lauren Baier Kim
Prepping before it's time to sell
Think you might try to sell your house in a few years? Then now's the time to do what you can to make your house market ready, says Bill LaHay in a Universal Press Syndicate story published by the Orlando Sentinel.
While most people have heard of readying one's house just before putting it up for sale, keeping one's home maintained during your entire ownership is both a time saver and a money saver, he says.
Among his tips:
- Don't let routine maintenance slide – repair leaky faucets, replace cracked window panes.
- Create a "wow" feature to make your home stand out from the crowd, such as a large bank of windows to bring the light in, or detailed woodwork.
- Keep consistent when it comes to quality -- if you spring for top-of-the-line countertops but go cheap on the floors, buyers will be more apt to notice the poorer-quality flooring.
'Bad Neighbors' Bring Down Prices
Having bad neighbors who are noisy or don't keep up their home's appearance is more than just a nuisance. They can bring down your property's value, writes Frank Rosci in the Jewish Exponent of Philadelphia. For instance, one Philadelphia-area broker quoted in the article says she lost a listing (and a house didn't sell) because the residence across the street "was a complete wreck that needed paint and a whole lot of fixing up." The neighbors didn't respond to requests by the sellers or the township to repair the home, the broker says.
If you find that a neighbor or his home is hurting your home's resale value, what can you do? You can broach the subject with the neighbor or "report enforceable infractions" to local authorities, the article says. Condo owners can enlist the help of their condo association.
If worse comes to worse, you can tackle some of the problems yourself. Mr. Rosci writes that in some cases, neighbors have been known to mow lawns and do fixes at abandoned homes in neighborhoods with foreclosures.
But if nothing works, you may have to lower your home's listing price to account for the "negative externality" of your home, Mr. Rosci says.
Cities take banks to court
Rust Belt cities like Buffalo, N.Y., and Cleveland, are filling up with foreclosed homes as banks abandon properties with values they deem too low, writes Michael Orey of Business Week. This creates a problem as cities are faced with a surging number of dilapidated houses and unpaid property taxes. In Buffalo alone, there are as many as 5,000 to 10,000 vacant homes, Mr. Orey reports.
To tackle the problem, Buffalo has what is called "Bank Day," in which institutions like CitiFinancial, JPMorgan Chase and CountryWide Financial are hauled into court for not keeping up the maintenance on such homes. Buffalo has threatened banks with liens and has tried to get lenders to donate properties to community groups or pay for homes' demolition, Mr. Orey says. He says that loan originators, servicers and Wall Street trusts that buy and securitize mortgages have been charged with violations by the city. Cleveland has launched a similar program, he adds.
Banks contend they are not responsible for maintenance on properties they don't own and often ignore Buffalo's summonses, so the city sometimes enters default judgments against the lenders and imposes a maximum fine of $10,000 to $15,000, Mr. Orey says. The fines give the city a lien against the lenders that can make it difficult for banks to buy or sell other properties in the area, he says.
Banks aren't the only ones being fined -- homeowners of abandoned homes have been levied fines and called to perform community service by the city, Mr. Orey says.
Charlotte transplants try support group
Charlotte, N.C.'s housing market is relatively strong -- ending in Nov. 2007, average homes prices there have risen 23 out of the past 25 months, reports Christopher D. Kirkpatrick of the Charlotte Observer.
But the market is slowing -- Charlotte homes took on average 124 days to sell in Oct. 2007, while they spent 118 days on the market in Oct. 2006, Mr. Kirkpatrick says. Also in November, home purchase contracts fell 21% from their Nov. 2006 levels, Mr. Kirkpatrick says.
Also dragging down the housing market in the area -- which gets about 80,000 "transplants" or new residents a year -- is that "too many clients are simply blocked from buying because they can't unload properties elsewhere," the article says. For instance, one area mortgage broker has helped create a support group for new area residents, the "Charlotte Transplant Meetup." Fifteen out of the 89 members in the group hold a mortgage on a home that they can't sell in another state or region, the article says.
