Selling a South Bay Historic Home
Steps for getting top dollar for your Historic Home
Step 1:
Consult with a Real Estate Broker who is experienced in the sales of Historic Properties to determine the properties value and what kind of repairs or upgrades you are able or willing to do before placing the property on the market. Facts to be considered are location, condition, functionality, quality of any updating and/or remodeling, time frames, market condition, decluttering and appeal. At this time an Estimated Proceeds may be prepared so that the seller has at least an idea of what it will cost to sell the property and what they may be able to net from the sale. Also at this time the sellers are advised to use the Estimated Proceeds to consult their tax specialist on the tax ramifications of selling the subject property.
Step 2:
Determine the properties condition. Anyone that tells you that selling or buying an Historic Home is no different than any other property does NOT have a clue or does not care what they are doing. Building codes and standards have changed over the years and have tastes. The absolute best way to determine the condition of a home is to have a pre-sale inspection done prior to doing any repairs or placing the property on the market. This is very common in Central and Northern California north of Ventura but is not in Southern California. Consider that over two-thirds of escrows cancel over sellers and buyers agreeing on the repairs or repair credits requested by the buyers. Have also seen people spend tens of thousand dollars on upgrades and repairs only to find out the foundation needs lots of help. Forewarned is forearmed.
Step Three:
Complete what repairs or improvements you are willing or able to do to get property is absolute condition. If funds are a problem please do not hesitate to ask about a short term, no interest loan to fund any repairs or improvements. This loan would be due upon sale.
Step Four:
Implement a Marketing Plan that has be designed around your property and your goals. At this time Staging may be done (Please consider that staging can take away from a Vintage property if the furniture is the wrong style or will interfere with a property speaking for itself). Professional pictures will be taken, a floor plan may be drawn, Ariel shots may be taken so the buyer can better see the location and other marketing materials can be designed and printed such as flyers and brochures.
Step Five:
Property is placed on the local Multiple Listing Service. If the property is a multi family or commercial it will also be placed on Crexi.com. Property will be announced on the Bonanza Realty Facebook Page and on LinkedIn. If open houses and a Broker’s Open House is appropriate and the sellers are willing, they will also be held. Advertisements may be placed, depending on the property, in local publications such as the South Bay Daily Breeze, Los Angeles Times or Beach Reporter. Flyers may be taken door to door to the neighborhood and/or mailed to local property owners.
Step Six:
Offers are reviewed. Depending on the property and the asking price one to several offers may be reviewed over the course of a four to six month listing. Part of the review process is a Synopsis of the Offer and an Estimated Closing Cost Estimate so that the seller can see the bottom lime.
Step Seven:
Offer is accepted and Escrow is opened. This stage is where a buyer who is purchasing with a loan sends out an Appraiser to determine value from the lender’s standpoint. Also the buyers usually have a Physical Inspection to satisfy themselves of the condition of the property. Other inspections often are Sewer Line Inspections, Moisture Inspections, Fireplace or Masonry Inspection, Foundation and any other Inspection suggested by the Physical Inspector or desired by the buyer. It helps to remember that you are selling a home that is at least 80 years old and such an investment is not one a buyer is going to take any lighter than you did in your decision to sell. This step is also where the buyers and their Realtor review reports such as the Preliminary Title Report prepared by the Title Insurance Company who has been picked to insure the Transaction. Also required by the State of California is the Natural Hazards Report that is done by a third party company that discloses to the buyer the property’s proximity to Industrial Zones, Munition and National Guard Stations, Pipelines, Flood Zones and Earthquake Faults.
This step is also where the buyers and their Realtors review any and all Seller Disclosures such as the Real Estate Transfer Disclosure, Seller’s Questionnaire, Disclosure and Forms going over such things as Water Saving Plumbing Fixtures, Smoke Detectors and Carbon Monoxide Detectors. This is also the step where the buyer has the opportunity to ask the sellers to do any repairs or credit them to do the repairs themselves. The only things the seller is required to do in California is provide and install Smoke Detectors, Carbons Monoxide Detectors and make sure any Gas Water Heater is properly strapped for Earthquakes and has a Pressure Relief Valve and Outflow Pipe. Some municipalities do require more such as Earthquake Shut Off Valves for the Gas Line.
Step Eight:
Closing Escrow and Moving: First thing to be aware of is that in Los Angeles County Escrows close electronically. The money is then wired back to escrow and disbursements are made. If you want or need your funds to move then you have to arrange at the time the contract is negotiated. Most buyers want their new homes the day the escrow closes and expect the sellers to pay their principal, interest, insurance and taxes (PITI) for the days they stay beyond the time beyond the first day the escrow has closed. They also expect that pouring rain will not stop the sellers from moving out. Be aware that work schedules are not as easily altered today as they were in the past. Employers are far less willing to give their employees time off to move so it may be critical for the buyer to close by a certain date and have the seller to move out.
Seller’s are obligated to remove all their personal belongings from the property including trash before turning it over to the buyers unless otherwise negotiated. Also there may be negotiated in the contract that the seller’s need to do cleaning before handing the buyers the key’s. Give yourself extra time since something will probably go wrong. Every move has at least one small disaster. Also expect to ask the buyers if they are going to paint or redo flooring before they move in. If they are not you could be expected to touch up scratches and nicks the movers make. The infamous Southern California traffic can hold up the moving truck and weather related issues could arise even in the dry season.