Archive for June, 2008
How to Price Your Hoboken Condo or Brownstone to Sell
Categories: For Sellers, Hoboken Condos
Thanks to Howard J. Turoff, CPA, & Financial Guru
Price, Price, Price
Everyone has heard the old axiom that the three most important things in real estate are location, location and location. From a buyer’s perspective that is often true, but for sellers, the location is effectively fixed, so the single most important decision you will make in selling your Hoboken condo, co-op or house is the initial asking price. There are a universe of people our there looking for whatever it is you have to sell, be it a 1 bedroom condo, a Victorian brownstone, or something else. Some buyers have just started their search, others have been looking for months and have seen everything there is to see in Hoboken. When your unit hits the market and is shown on the Multiple Listing Service (the “MLS”) for the first time, there will be a flood of initial interest that may never be matched. Pricing your unit appropriately is the very definition of “striking while the iron is hot” to achieve maximum return.
Most Things In Life Fall on a Bell Curve
Like most things in life, the real estate sales market can be described as a bell curve. At one end of the spectrum are beautiful properties, in great locations being offered at fair prices. These units sell immediately - often within the first few days after hitting the market. At the opposite end are not-nice, overpriced apartments in less than desirable parts of town. They languish on the market forever (or at least until the price is lowered sufficiently to make them attractive.) The vast majority falls somewhere in the middle - hence the bell curve. See:
Don’t Make The Most Common Real Estate Mistake
Many people have a number in mind when they first decide to sell. That number may be based on what they paid, how much profit they hope to realize, what they espect to pay in closing costs, or how much money their neighbor got when he or she sold last year. If that number is too high, and I tell them that they will have a difficult time selling their place for that amount of money, they will often say to me “Let’s start with that - we can always lower the price later.” That may be true, but in my opinion it is also a huge, irreversable strategic error.
Using a Bazooka to Create a Sense of Urgency
Have you ever gone to a sale at a department store and seen people frantically grabbing at clothing in a discount bin, or watched people fight over t-shirts shot out of the air bazooka during the 7th inning of a ballgame? There is an urgency to getting those bargains because if you don’t get them, the person right next to you will and then they’ll all be gone. Now think back to what I said about the universe of people in the market to buy a condo or house in Hoboken. You will never have a bigger crowd of interested people looking at your unit as when it first hits the market. You want to create that same sense of urgency - that if they don’t make a strong offer RIGHT AWAY, that unit will disappear and it’ll be too late. Overpricing the unit, killing the interest, scattering your crowd and then lowering the price later is a bad strategy.
Remember Goldilocks and the Three Bears
Drastically underpricing a unit is an equally bad practice. If I see a listing that I know is worth $100,000 more than the asking price, I’m texting my buyers looking for that type of property immediately. I’d try to lock up the offer before the seller caught wind that he should be asking for more and I’d try to get it off the market before someone else did offer more. That’d be great for my buyer, but this article is about sales strategies. No - the best strategy to achieve the highest sales prices, is not to overprice, not to undervalue, but to price it just right - you must correctly value your property at or near it’s market rate.
Reasons to be Cheerful
I’d choose a starting price that is just slightly above the fair market value with the understanding that you may be willing to negotiate a little, but that you believe the price is fair and you are somewhat firm. If your agent has done a good job evalutaing the comparable units available that you are competing against, and your started at a fair and reasonable price, there is no reason to believe that you won’t get multiple offers and may in fact get a price above asking. Then when people tell you how lousy the housing market is, you can just smile.
The Donut Proof
One final thought that I’ve put into the format of a Q and A for your reading enjoyment. We’ve all visted the local donut shop at one time or another.
Q: How much do you think it costs them to make those donuts?
A: I’d guess a few pennies.
Q: How much do they get for the donuts?
A: Around $.50 to $.75 depending on where you live.
Q: How do you know they’re fairly priced?
A: If they’re all gone at the end of the day, then they were priced correctly.
Q: If they’re not all sold at the end of the day, are the leftovers worth as much tomorrow?
A: No, there are newer fresher more enticing ones available and the older ones get marked-down. If they don’t sell by the end of the week, you probably won’t even get back the pennies it cost you to make them.
Do not let your condo become stale - sell it while it is hot!
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Selling your Condo in Hoboken? Here Are 3 Reasons to Fire Your Listing Agent
Categories: About Realtors, For Buyers, For Sellers, Hoboken Condos
1. The MLS Listing of Your Property Has No Photos
There are, literally, hundreds and hundreds of condos for sale in Hoboken today. When an agent is working with a buyer, there is no way every unit can be shown. The agent will choose what to show the buyer based on what they think the buyer might like and, of course, what meets the buyer’s criteria. Most properties listed for sale on the MLS have at least 8 or 9 photos of the property. A photo of the facade of the property is supplied by the MLS automatically when the listing is entered. I am always stunned, however, when I see a listing with no other photos. What is the listing agent thinking? How can anyone expect to have shown and sell a property without photos? If your listing agent has not taken (or hired a pro to take) several excellent photos that highlight the best features of your property and put them up on the MLS, you need a new listing agent.
2. The Flyer Advertising Your Condo For Sale Placed in the Window of Your Agent’s Office is Incorrect
Every Hoboken real estate office displays flyers in the window advertising properties for sale. If you are selling your condo in Hoboken and have listed it with a realtor, you should have a flyer, too. Take a close look at yours. Are there typos? Grammatical errors? Is the listed price correct? What about the taxes and maintenance amounts? Is the description complete and enticing? Do the pictures make your unit shine? If your flyer is not perfect your listing agent is not doing his or her job. The same principle applies to any on-line or print ads regarding your property. In today’s market, everything that is used to market your condo had better be perfect. You need to stand out from the crowd. If your agent doesn’t strive for excellence, find one who does.
3. The Keys to Your Hoboken Condo are at a Real Estate Office Outside of Hoboken
Even though you are selling a Hoboken property, you may have listed it with an agent from an office outside of Hoboken. That, in and of itself , may be problematical but that’s another post. If your out-of-town listing agent thinks that local Hoboken agents are going to drive to Jersey City or Clifton to pick up keys to show your Hoboken property, he or she is dead wrong. If the property is in Hoboken the keys (note I say keys, plural) should be in Hoboken. The harder it is to show your Hoboken condo that is for sale, the less likely it is going to get shown or sold. Unless your agent keeps the keys at the Hoboken office or arranges for a lockbox, it’s time to find a new listing agent.
Hopefully, you will consider these things when deciding who you would have list your property and before you sign on the dotted line. Next post - how a buyer knows if they are working with a competent agent.
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The Weekly Wednesday Wrap-Up - Hoboken Condo Sales Inventory & Activity
Categories: For Buyers, For Sellers, Hoboken Condos, Weekly Wednesday Wrap Up
Italy Trumps Hoboken
So I’m in Italy on vacation but I couldn’t resist checking and posting the figures. Given that I can choose to spend my time thinking about Hoboken real estate or eating gelato and riding my bike in the beautiful Italian countryside, sorry, for this week when it comes to my priorities, Italy wins. But here are this week’s numbers, nonetheless. It’s more of the same - more units for sale and steady numbers of sales resulting in a continued build-up of Hoboken condos for sale.
Hoboken Real Estate - Condo Sales and Inventory As Of June 25th.
Studio & One Bedroom Condos:
Total Active: 142 Under Contract (Dabo’d): 86
Sold (Deals Closed) This Week: 2
Average Sold Price: $502,000
New Listings This Week: 5
Two Bedroom Condos:
Total Active: 303 Under Contract: 114
Sold: 6
Average Sold Price: $591,166
New Listings: 25
Three Bedroom Condos or Bigger
Total Active: 54 Under Contract: 12
Sold: 1
Price: $650,000
New Listings: 2
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The Weekly Wednesday Wrap Up - Hoboken Property Inventory & Activity
Categories: For Buyers, For Sellers, Hoboken Condos, Market Analysis
Hoboken Real Estate - Condo Sales and Inventory As Of June 18th
Hoboken condo inventory continues to increase even though it’s summer time, traditionally a slower season for putting properties on the market. Next week will be the end of the first half of the month and I’ll post a full report on market activity at the start of July.
Studio & One Bedroom Condos:
Total Active: 151 Under Contract (Dabo’d): 79
Sold (Deals Closed) This Week: 8
Average Sold Price: $395,875
New Listings This Week: 8
Two Bedroom Condos:
Total Active: 299 Under Contract: 116
Sold: 10
Average Sold Price: $596,700
New Listings: 32
Three Bedroom Condos or Bigger
Total Active: 55 Under Contract: 13
Sold: 4
Price: $641,250
New Listings: 3
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4 Big Problems Sellers Must Face When Selling a Hoboken Condo
Categories: Design, For Sellers, Hoboken Condos
1. You Have Only 3 Minutes
Let’s say you list your Hoboken condo for sale and, thanks to excellent marketing, have a showing appointment for a potential buyer to come to see it. You’ve got their attention and they are in the door. How long do you think the average buyer spends in each property? Five minutes? Maybe 10 to 15 if they really take their time? To think that you have 5 minutes to convince a buyer to buy your condo is generous. Most buyers walk in, take a quick look around and make a snap decision in the first 3 minutes whether or not they like the property enough to buy it. This decision is a gut reaction and can be very subjective. If they don’t immediately get a good feeling about your condo in the first few minutes, trust me, they are ready to move onto the next.
Your condo must make an outstanding impression in the buyer’s mind immediately. That means you need “wow factor“. Wow factor is what happens when someone opens your front door, steps inside and, literally, says “wow”. Selling real estate successfully is all about first impressions. There are many different ways to make “wow” happen depending on your particular property. An exceptional realtor should present your property in such a way that potential buyers walk in and can picture themselves living there. Unfortunately, many realtors have no clue how to do this and some sellers don’t use a realtor thinking they can do it better on their own. We’ve all seen photos on-line of condos for sale taken with the laundry piled on the closet floor and the toilet seat raised in the bathroom. Many people just don’t get what it takes to make a property shine. The most important steps include decluttering, depersonalizing, modernizing and creating an immediate focal point that draws the buyer’s attention to the defined attributes of your particular condo. Spending all day, almost every day seeing other condos that are for sale certainly gives you an edge in knowing what must be done.
When a buyer walks through your condo and has an internal dialogue that sounds like: “well, if we change the paint color and redo the floors, then put the couch over here to make this room flow better, we could eat over there, and maybe build a small closet against this wall” forget it, it’s over. When a buyer focuses on what is wrong with your condo instead of what is right you have lost the sale. The buyer must be so taken with everything right about the property and can picture living there so easily that they never even notice any potential flaws or drawbacks.
2. Your Taste Doesn’t Matter - Selling a Condo in Hoboken is a Numbers Game
You might have spent years agonizing over every little detail in your home to get it just the way you like it. The problem is, nobody cares what you like. To sell your condo you need to consider what most condo buyers will like. Of course, you can’t get inside every buyer’s head but you can shoot for the most popular choices that are most likely to appeal to the greatest number of potential Hoboken condo buyers. For example, if you’re selling a 2 bedroom condo in Hoboken, remember that Hoboken is full of young couples with babies and they almost always want a washer/dryer in their home to wash the baby’s onesies. If you are selling a 1 bedroom condo in Hoboken, chances are high that your buyer is a young, single professional who commutes to work in the city. Most guys want a place to put a really big flat screen and most girls like a huge closet with adequate shoe and purse storage. Did you think about that when you set up your furniture or organized your closets for showings? Is the first-time Hoboken buyer going to walk in and immediately see the perfect wall opposite the couch for the plasma TV or “ooh and aah” over the little shoe storage boxes built into the closet? You may love the purple walls in the bedroom but do you think more buyers will prefer purple or cream? Even if you never needed or wanted these features what matters now is what your potential buyer likes and wants. The more potential buyers you can appeal to, the more likely one will take action and make an offer and the more offers you get, the more likely you are to sell.
3. There is Stiff Competition in the Hoboken Condo Market - Go See For Yourself
The inventory of Hoboken condos for sale is on the rise. You are not the only game in town, no matter your location or price. Today’s condo buyers have choices. Let’s imagine that you own a condo in 100+ year old, 10 unit, walk-up building on Park or Willow or even Hudson. These long, narrow, two-to-a-floor condos are abundant in Hoboken. Does yours stand out from the others? Have you actually seen the others that are for sale? If not, why not? The potential buyer of your condo will probably see all of them before deciding on which to make an offer.
The same applies to newer construction units like MetroHomes or Fields construction buildings. These units are not inherently that different from one another. They tend to be located in similar areas like the northwest section of Hoboken. Your condo, at whatever price it is offered, must be one of the best available in that particular price range. Hoboken buyers are smart, sophisticated and willing to shop around. Your condo unit must be perceived by the buyers as the best deal in town. If it’s not, your condo is simply not going to sell in today’s market at the price you are asking.
4. Hoboken is a Buyers Market - If your Condo is Overpriced it Will Not Sell
This problem relates back to the other three. Sellers always have reasons why they can’t bother to paint or put possessions into storage or replace the bathroom vanity or redo the kitchen. Sometimes it is unrealistic for a seller take the time or make the effort or invest the funds to build a new closet or rearrange furniture or whatever may be needed. That’s fine. That’s a seller’s decision. There is, however, always an alternative to taking action. If your condo can’t show as the best on the block it had better be a bargain. If your condo does not call out to the average Hoboken condo buyer and make their heart beat faster as soon as they walk in the door it is unlikely to sell unless it is perceived as a great value compared to the other similar condos for sale that show beautifully. There are some buyers out there who would rather get a deal and do their own renovations than pay top dollar to buy a mint condo. Keep in mind, however, that most Hoboken condo buyers are young and busy with jobs and families. The majority of them don’t want to or don’t have time to deal with construction or renovations. Most Hoboken condo buyers want a condo in move-in condition.
How do you know what the sale price of your condo should be? Well, again, if you have a skilled realtor they can help you correctly reach that decision. Beware that many real estate agents out there today are not doing well in a slower market. These less successful agents will do absolutely anything to get a listing. If you tell them you would like to get $500,000 for what is really a $400,000 condo they will list your condo for $500,000 rather than offend you and possibly lose the listing. The problem is, your condo won’t sell if it is overpriced. That real estate agent isn’t too smart because they are going to have to spend time, money and effort to market your property to no avail. If it doesn’t sell, they don’t get paid and you are not happy with them since you likely will see it as their failure to do what you hired them to do - sell your condo. But then, if they were a good agent they would not have taken the listing at an inflated, unrealistic price. So tell your agent you want to go and look at the Hoboken condos for sale that are similar to yours at the price you would like to ask. If you were a buyer, and be objective now, would you choose your condo as the best condo for sale on the market right now? If not, you need to list your unit at a lower price.
Sellers don’t like to hear that they are going to get less than they would like when they sell their condo. Many sellers price their condos based either on what they paid and how much they hope to make in profit or on what their neighbor got for his. Buyers don’t care what you paid. Buyers don’t care what your neighbor sold for last year or last week. Buyers only care about what is for sale right now and how your condo stacks up. Of course, some buyers may decide that no condo currently for sale in Hoboken is worth its asking price. That buyer, for whatever reason, has not made the necessary mental committment to part with his or her money at this point in time. That buyer is never going to buy your condo anyway. The buyer you need to attract and convince is the buyer that is serious about buying a condo in Hoboken now. The serious buyer has made the mental leap and will part with the cash but still wants value, and value is perceived as getting the best possible property for sale.
Remember the 4 classic steps in a making a sale: AIDA or Attention, Interest, Desire, Action. The proper marketing and advertising of your condo should get the buyers attention. When they walk in the door, the WOW factor is going the get their interest. A buyer who can picture himself living in the space has desire. When that buyer feels that your condo is priced right because it represents a good value compared to the alternative he or she will take action and make an offer. Its a formula that’s been around and proven for a long time. Now you know how to put it to your advantage to sell your condo in today’s Hoboken condo market.
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