Preparing homes for market pays off in the end

Real estate news on Santa Barbara’s South Coast has consistently reported that the number of sales is down, that active and new listings are down, and that there is about one to two months of available inventory.

Even with interest rates up, financed and cash buyers are still showing strong, yet prudent, demand for homes in our area.

All of this makes for what continues to be a “seller’s market” marked by buyer demand, brisk showing activity and, in many cases, competitive offers and overbidding — most notably in those properties around and below our median price of about $2 million.

Given this buyer demand and “seller’s market,” some sellers may question why they have to go through the cost and process of preparing their home for market, doing updates or repairs, paying for presale inspections, staging and pricing competitively. The answer is simple: They will sell faster and make their investment back and likely more.

and estimates for major repairs.

By spending money up-front, sellers can often head off costly repair negotiations during escrow. With more information about the property, buyers can write offers confidently and avoid surprises during their inspection period. It has been shown many times in recent years that when the seller provides a major repair estimate — foundation, roof, drainage — up front, they can avoid the buyer renegotiating that work during escrow. The cost of a $350 inspection may head off a $30,000 to $80,000 concession.

Cara Gamberdella

Once the seller has their house prepared and inspected for market, the last piece is pricing the home to sell. The listing price is an integral part of the overall marketing strategy. In today’s market, sellers cannot simply put their home out at a “make me move” price and expect buyers to bite.

Even with low inventory and high demand, buyers are more informed and savvier than they have been in decades, and they are influenced by the gloomier real estate news coming out of our national media.

Through presentation and price, a seller’s home has one chance to make a great first impression, convincing those skeptical buyers that this house is “the one.”

This is not the time to skimp on pre-market repairs or updates, staging, decluttering and freshening up the curb appeal. The first step is for a seller to interview and hire an experienced Realtor as their listing agent. This professional will be an invaluable team member with the goal of selling the home at the best possible price and terms.

A listing agent’s recommendations for market preparation will always start with a tour of the property, assessment of the needs and the client’s budget. Most homes will need some level of staging — whether it is decluttering and accessorizing the seller’s furniture and décor, or a full staging of a vacant home.

Other updates may include paint, flooring, repairs of items that could hinder the sale of the home, landscape tune-up or a curb appeal refresh. The seller’s Realtor will work with the seller and trusted vendors to procure estimates for any recommended work, and then prioritize with the seller where they may get the best return on their dollar and stay within budget.

It is part of the listing agent’s service to manage and schedule any pre-market work, so the sellers can concentrate on their own work and responsibilities. Some brokerages offer services where a seller can have staging, high-impact cosmetic renovations and repairs designed to maximize the home’s value with no out-of-pocket or up-front fees. All costs are deferred until closing or a negotiated term.

Staging, paint and flooring are updates that have the highest impact on a buyer’s perceived value. Statistics show that staged homes sell 87% faster and up to 17% more than comparable homes that are not staged. That might mean $300,000 or more on a home in our median price-point.

In recent years, we are seeing more sellers getting, and listing agents recommending, pre-sale reports

The listing agent will advise the seller using recently closed comparable sales, active inventory that may be “competition,” current market forces and overall buyer sentiment and activity to give an informed opinion about the best pricing strategy. On properties that are uniquely challenging to price, often a listing agent will invite other agents who are active in the neighborhood, property type or price range for a preview and their price opinion. Sometimes many heads are better than one.

Ultimately, the only person who can definitively tell the seller what their home is worth is the buyer who writes an offer and closes the transaction. The goal is to pinpoint the list price that will get the best exposure and generate high interest to get a buyer or buyers to write that offer.

As of the end of February, the average Days on Market for single-family homes in Santa Barbara was 30, up from 23 in 2022. The average list-to-sale price was 97% down from 101% in February 2022. From the perspective of current buyers, 30 days on market is long, and they assume “something must be wrong” with the property.

In many cases, homes sitting on the market for longer periods are not priced correctly or not presented in a way that garners demand and value in buyers’ eyes.

Even with this average, there are properties that are still selling in one to two weeks and for significantly over the list price. These are the homes that are prepared thoughtfully and priced strategically.

With higher interest rates and some more sobering national real estate news, buyers are not as willing as they were a year ago to throw any amount of money at something with four walls and a roof. They are more prudent and thoughtful and must feel that the home is worth quick and decisive action.

Savvy sellers can capitalize on limited competition by presenting a polished and well-priced property that encourages the group of buyers out there to funnel to their offering as the one they “must have.”

A former local high school English teacher, Cara Gamberdella has been practicing real estate for 17 years, all with Village Properties. Santa Barbara has been home to Ms. Gamberdella and her family for more than 46 years. You can find more information about Ms. Gamberdella or contact her with any questions at www.caragamberdella.com.