Recently, Suzanne sat down with Matt Becker of Magnolia Real Estate for a conversation about key ways to get the best price for your rehab properties during a slower time of year. From finding the right agent, to choosing quality finishes, to pricing, to staging, to pictures, these strategies will work to your advantage any time of year– but they’re essential as we head into the slower market of the holidays and winter. Let’s listen in!
SUZANNE: Matt, you’re an awesome real estate agent and broker for Magnolia Real Estate, with a top-performing team of 80-plus agents. Your main office is based in St. Charles County, MO, but you go all over the area, right?
MATT: Yes, we go everywhere, in and around the St. Louis area, as far north as Mark Twain Lake, all around the Lake of the Ozarks, the Columbia area, and more.
SUZANNE: We know, historically, the market slows down a little bit in October, November, and on into the holidays. Yet this is still a hot market if you’re offering a good product! So what are some of the top things people should do, proactively, to get their house sold quickly at the best possible price?
MATT: Being a realtor and owning a brokerage, I know one of the biggest things is finding the right agent, the right brokerage, for you and for the area. Most sellers don’t realize the advantage of doing that early on– don’t wait until your project is almost finished.
SUZANNE: How do you recommend they go about finding the right agent?
MATT: Well, it’s nice if you already have a personal connection to a good realtor, but there are a lot of people who don’t. So ask around. Talk to friends and family members, read reviews, do your research, and talk to two or three different agents.
SUZANNE: What questions should the seller be asking them?
MATT: When you talk to agents, ask them about the specifics of your house and the specifics of the area. Make sure the agent you choose knows the market you’re in. If your property is in Lake of the Ozarks, you’re not going to want an agent who has never sold a house in Lake of the Ozarks before. It’s a far different market than O’Fallon, Missouri, for example.
SUZANNE: I would caution sellers, here, that even if you have a close connection with a realtor who is a friend or family member, you’ll want to treat them as you would any agent in terms of interviewing them. If they aren’t the right fit, it’s not going to help you sell your house. For example, if they know St. Louis County well, but your house is in the City, they might not be the best fit.
MATT: Great point. As an agent, nobody likes it when friends and family don’t use you, but if you’re not the right fit for a certain house or area, it’s not going to work out well in the long run, anyway. You’ll be doing them a disservice, which could strain the relationship.
SUZANNE: Absolutely. So step one was to find the right agent with market-specific experience. What else can you recommend to help sell a house quickly and for the most money?
MATT: Once you pick a listing agent, bring them into the process of finishing your project. Don’t wait until the project is done. It’s in their interest, too, for you to offer the best final product. Walk the property together. Let the agent point out things that will be called out by buyers. Make a punch list as you go. Even ask your agent about final finishes, and listen to their advice about matching the product to the price point. Don’t go too cheap for the sake of saving money. Use better quality materials if you are in a better neighborhood. Make the product match the price point! Ask the agent to recommend a staging company. Good staging is super important.
SUZANNE: That’s a great point– don’t wait until the project is finished to bring your agent in. The agent knows what’s trending and can help you make good choices. For example, a couple of years ago flippers were putting in gray flooring. Now nobody is using gray flooring because buyers don’t want it. A good agent will know the trends that will bring in higher offers.
MATT: Exactly. Whether it’s choosing a certain type of light fixture or deciding whether to do an accent wall, your agent can help you not only pick what’s trending but can help you match the materials to the price point. If you’re selling in an area that draws a $300k price point, but you chose materials that dictate more of a $250k price range, the house is going to sit. People will notice and they won’t pay the higher price. You’ll have higher holding costs and you’ll ultimately regret not putting that money into finishes that would have made it sell faster and at the pricepoint you wanted. You’ll wind up losing money.
SUZANNE: What advice do you have for the flipper out there who, all through the project, has understood in the end this is a $200k house, and he’s chosen materials for a $200k house; but then he sees a similar flip next door, listed at 200k, getting multiple offers and selling for $250k? Should he now list his house at a higher price?
MATT: Don’t do it! We’re in a market where buyers and agents are already in the mindset of needing to fight for a house, to come in with higher offers. If your house starts out high, they won’t want to put in an over-ask offer, and you definitely won’t get multiple offers. Your house is likely to sit longer. A good agent knows how to get the higher prices– it’s kind of a dance. Take their advice on pricing. Know the comps and know the correct price point for the area. Don’t just go with the agent that says they can list it at the highest price for you. What good is that if they can’t sell it at that price?
SUZANNE: Often I hear people say, “I got my real estate license so I could be my own agent and save money.” But I see that their houses are too often just sitting. What advice do you have for people who have done this or are thinking about doing it?
MATT: Just because you have the piece of paper that says you can sell a house doesn’t mean that you’re good at it, or that you should. If you don’t have the experience and the knowledge that go with selling houses frequently, it’s not a good idea. An inexperienced agent will not be prepared for the negotiations after inspections. They especially aren’t prepared for the emotions that go with trying to sell a house that they have invested themselves in and have probably fallen in love with to an extent. They have to hear someone picking it apart, calling out things that can make them feel defensive. When they go up against an experienced buyer’s agent who knows all the ins and outs and every little detail of fighting for the best contract, the flipper-as-agent is going to get run over in that deal. They will lose money in the long run.
SUZANNE: Exactly. Quality agents usually pay for themselves, in my experience.
MATT: They absolutely do. When you interview them, discuss the process and their paperwork with them. What have they done before? Who do they use for staging? Quality staging is worth the money, every time. Who do they use for pictures? For pictures, choose professionals who will pay attention to lighting and details and not carelessly take a shot with a paint can in the corner or an electrical outlet cover missing. Make sure there is a solid timeline in place for all of this. Don’t think you can finish a project on Thursday and it’s going to be on the market by Sunday.
SUZANNE: Matt, thank you for all of that great advice. I know people will appreciate it and use it to produce the highest-quality flip and to get the most for their house quickly, even in this slower season.