Selling a House for Top Dollar with Mindy Jensen #162
This episode is brought to you by office. Depot Office depot has supplies and services for businesses of any size and they have a wide range of services they can provide twenty four seven tech support. Print your marketing materials and even help you design your office with variety of furniture solutions. They also have all of the supplies. Your office needs from ink and in paper to cleaning and break room supplies. I'll tell you one thing that I never want to have to mess with again is figuring out what kind of toner cartridges. My particular brand of printer her needs office depot. has you covered whether you're running a home office like I do or work in a larger corporate setting they have you covered office. Depot is ready to help your business with knowledgeable eligible associates in over thirteen hundred stores or online at Office Depot Dot Com. Welcome to how money I'm Joel and Matt and today we're discussing selling a house for top dollar committee Jensen. Yeah August today knows pretty much everything. There is to know about residential real estate Mindy Jensen. She is a licensed real estate agent in Colorado. And she's been buying and selling homes for about twenty years now and not only does she buy and sell for her clients but she is an investor herself. A specifically she has this effective way of flipping properties. And and will actually. We'll get into that here in a little bit but mindy. She works at bigger pockets dot com where she helps. Investors learned the proper ways to invest in real estate and she he also co hosts the podcast bigger pockets money and so today we'll spend the majority of our time talking through the ways that our listeners can sell their homes for the most money possible. School Mindy thanks so much for joining us today. Thank you for having. I'm so excited to talk to you guys. Today I love real estate so hit me. Breath hit me with your best shot. Just hit me a great song by the way he also wrote a book like this is what you love real estate. You wrote a book called how how to sell your home and if our listeners stay tuned till the end of the show. We're going to give away ten physical copies autograph of your book so so awesome stay tuned for that by the way the first thing that we lead off the first question that leadoff asking people is about craft beer because matinee drinking craft beer on the show. It's really important to us today at this on the show were drinking a beer called slamming at the club by Casa Agree Speciality Ales and I know you love Craft Beers well what's your splurge. What's your craft beer equivalent as you're saving money and being intentional as you save for the future what are you willing to spend a little bit more on right now well it is absolutely splurge? It is literally the dumbest thing you could spend the money on. It is a car on the bigger pockets. Buddy podcast one of the questions we ask of all of our guests is. What is your biggest money mistake and most people have some some version of? I bought a brand new car. I don't actually buy new cars. I bought a used car back when I was in high school. A thousand years ago I I had a friend who worked at the ACURA dealership and I was picking up after work and I walk in and I'm like Oh my God what is that. What is that car? That's the most beautiful car ever seen in my life. You say that's the new annex. Wow that is amazing. How much is it like sixty thousand dollars? That's not going to be my car. That's a lot of article. Yeah there was a lot of a lot of money back then. It's a lot of money now but it was even more back then so fast forward ten years. This car came with this coffee table book. Look instead of a sales brochure because it was sixty thousand dollars and I found a copy of that coffee table book at a thrift store so I bought it thinking. Someday I'm going to own and I packed up and moved at every time. We moved his as you alluded to in your introduction. I do live in flipping which means I move every two or three years so I'm packing up things a lot. We started talking my husband and I started talking to Makino. I would really like to own one of these cars now that we are financially independent. You know. Let's let's look at them and we found one and it cost forty five thousand dollars with that is an absurd amount of money to spend on on an old old car at all. I Bet I've got a friend who has what to. He's like yeah. I got an old Honda when I went to get license plates for it. She's looking she's it's like. Is this forty five hundred dollars or forty five dollars. Forty five thousand dollars SIC. Why would you pay so much for nineteen ninety-one ninety-one car will you and your husband? You're both into cars right. You guys are both kind of card nerds to a certain extent. I know I know your husband Carl. He really wants a tesla right. Yes he here's a supercar nerd. I am not so much but I was always really really excited about this car. So he bought it. He drove home from. Wisconsin is where we found it and I started it driving it to work when it was nice outside and it wasn't going to rain or hail or snow or whatever and I felt so awesome in this cars like who I feel like Hat's let's not driving down everybody's looking at you like as you drive down the road in an NSF. Six people will come up next to you like the passenger is hanging out of his car with his camera. Taking pictures of your car and it was a perfect specimen it was like the most beautiful type of this car and then I was driving down the expressway. And there's this guy in this super jacked up pickup truck and he starts coming over and I'm like no no don't hit me hit me and I'm hugging my horn. And he finally like sees me at the last minute in it and that kind of flip the switch in my head like you're sitting on a pile of forty five thousand dollars driving down the road and you could get into a car accident event and ruin it so I said to Carl. Maybe we should sell this car. He's like yeah. I been thinking about that for about six months now and yeah we should sell it and then I swear the next day a house came on the market that we wanted to buy. We needed to close really quickly. And we're like let's sell the car so we can buy a house so for you. It was a car you know. I feel like a lot of people do have that car storage old that you have I kind of have that story of spending being on a maybe more money on a vehicle that ever really wanted to. But you're always pretty good about finding those deals spending bare minimum amount. That can get you there. I tried but sometimes it bit me as I did. Go to cheap with car purchases. That's for sure and their two. Joel Right Oh man. Like eighteen. Hundred dollar beater. I've done that and it didn't last very long. No it doesn't windy like you alluded to you are financially independent. You're known online. Sometimes as Miss Fifteen hundred and that's because of your goal that you you and your husband Carl that you had to reach financial independence in fifteen hundred days or less and that was a while ago but where did you guys get that that crazy goal and how how's it going because you don't get to talk to folks every day who are financially independent. It's going perfect. Thanks Day so Carl. Carl was a software developer. He loves computers almost as much as he loves cars and he loves programming computers he was. I was a stay at home. Mom Tom and he was having a really really bad day at turns out there was a bug in code that he was writing Nicole that he was writing was for a blood bank software. So so if you have surgery and you need units of blood this software would choose the unit that matches with your body blood type and all this stuff so that you you don't die because if you get a different unit blood it's not compatible in your body's like no we're just GONNA die instead of figuring out or whatever. Obviously I am not a blood person but having this code that could kill. Somebody really gave him a lot of stress. which is kind of the dumbest thing I've think I've ever writing code? That could kill somebody buddy because that can kill somebody was killing him. Yes so spoiler alert. He didn't write the code and it turns out. There wasn't a bug but for about a week. His whole team didn't know that so he just had all this stress and anxiety and he finally sat down at his computer and he just banged out. How do I retire early? And this little website site that probably you've maybe not heard of. It's called Mr Money Moustache her laptop and he's reading he's like no way keeps reading this this guy selling something what does he selig's we keep reading keeps reading. He's like wait a second. This is just a math problem. This guy is laying it out. And he laid out the four percent rule in a way that Carl L. had never seen before he's like. Oh my God we could retire really soon and he comes running down the stairs like hey hey we can retire in in about three years or six years or whatever it was and I'm like okay great because I knew how stressful was about his job. He's like and I'm going to start a blog about it. I'm like that's the dumbest Thomas thing I've ever heard of it. Because why would you. Why would you blog about that He only knew of Mr Mustache and get rich slowly at the time time but he decided he wanted to start a blog about it. He we figured out our current Networth we projected lug it would take us to get to our desired. Zaire net worth of one million dollars in investable assets He thought it would be about fifteen hundred days so he like well. That's the name of our our our blog. Great Good Luck with the blog. I thought he was going to run out of things to write about an he cranks it out all the time. So yeah. That's how fifteen hundred days came to be and that goal mindy of something specific like fifteen hundred days. I got imagine that was a driving force the whole time that being the blog named that being kind of the time period that you guys has it picked out that had to be really really helpful in kind of nudging you at the Times where you probably wanted to kind of bail out or stop sucking away as much money as you were. Maybe we start spending more today to do that. Kind of specific timeframe was at a big boost in helping you guys continue to attack that goal. You know I'd love to agree with you because because that sounds way better than saying we're just really cheap and we didn't spend a lot of money and we both knew that you needed to invest. So we did. And he's a that guy so he would invest in things that he knew about. He was having a problem at work. One day a different problem. And he's like Oh man I don't know how to do this and his sates said you should google it. And he's like what does away longtime ago. You should look it up in Google and Carl's like what is that. So this guy shows him and Karl types in his question and there's his answer he's like Oh my God what is this. What is this amazing thing called Google and when they went public public they did this Dutch auction thing and he like bid on stock? And they're like okay. Everybody bid this much or this is the average of everybody's everybody's bid or whatever. The stock price is going to be this so he bought a ton of it and then facebook came out and he bought a ton of that. And you know we've had some duds too but we've had some really really great products and once apple came out with the ipod. All you see everywhere. You Go is white headphones. Everything else was black headphones but apple has white headphones. UC Whitehead's everybody's ears. You're like Oh that may be. You know that might be a good stuck like I think that's going to be something. I don't know just a hunch inch quick follow so we're talking about financial independence so for you guys. Obviously besides you being able to buy the car of your dreams I period of time. How did financial independence change how you guys live? Because of all the folks we've talked to who are facially independent. I feel like y'all are maybe the what I would call the most normal like like you've got a couple of kids you live in Colorado like the kids go to school. You're still doing weird stuff to make money which we're GONNA talk to the second. You guys still live like super normal the life you haven't bought in like your island or anything like that but but yeah so how do you realize that financial independence like what has that changed. So the biggest change is is that Karl doesn't have to go to a job that he hates and I think in fire financial dependence retire early. Most people focus on the R.. Not and you know financial independence so I can quit my job so I can quit my job. And that's what he did but we were financially independent for a while before before he took the leap before he actually quit his job because he had a really good paying job he was making six figures could work from home. Why would you walk away from that? And he didn't know what he wanted to do after he quit his job so he just stayed for a little bit longer and then I got the job that I have now working at Baker pockets. I love my job Bob. I've never had a job that more so it was okay for him to leave because we sort of had a cushion. I don't really feel like I'm working king because I get to talk about real estate all day long. I get to talk about money all day long. I don't have to work there. Get to work there. I love going to work. I feel guilty Elsie. When I go to work I'll be leaving the house and the girls are fighting with each other? And Carl's like wrangling them and see. I'm going to go have a good time at the office but I really enjoy what I do. I love everybody that I work with. It's just a really great experience so he gets to run his own life. He works works at. We have partnered with that. Very little known blogger Mr Money Moustache on co working space in our town of Longmont. But it's not really a job like he really enjoys always talking to hanging out. I'm sure he's just hanging out like he works on the blog. He's we just bought a house. This is a good segue. We just spotted dumpy house that we're fixing up our perfect segue. Let's get into that. So you guys are still normal. People despite having achieve financial independence but you guys are still still doing live and flips and we really WanNa talk a lot about selling a home because you literally wrote the book on that. But I'm really really interested in how you guys have. I used to live in flip strategy to help build some of that well to help you achieve financial independence. So can you. I share with our listeners. What a live in house flip is okay so a flip is when you take ugly house and you make beautiful and you sell it? A live in flip is when you buy an ugly house you move into quit as your primary residence while you fix it up you have to live therefore it well. You don't have to but I lived there for two years and then when I go to sell it. I pay zero dollars in capital gains taxes because it was my primary residence. I lived there for two years and I pay zero zero capital gains taxes up to five hundred with thousand dollars because of the section one twenty-one exclusion in the United States tex code so I've never hit that five hundred thousand dollars. I'm really excited about this house. Not yet not yet. The House that we just moved from we bought for one hundred. Seventy six thousand dollars. We I put about one hundred thousand dollars into it and I could list it today and sell it tomorrow for five twenty five. I could list it and sell it a little bit longer longer for probably five seventy five or six hundred thousand dollars. Because I've heard it. Yeah because I lived in it because I did all I didn't do all the renovations myself. Alf and when I say I mean my husband and I we did hire some people like we put in second story on. That's a lot of work. Nothing you're going to do on the side with kids. Yes asking for dinner like it's a time to say no I gotta I gotTa have the second store to that. I'll be done in six months. Yeah so an airfare and chicken nuggets your best friend living in flipping mom who brings us to another question about and I I want to say on the tax thing you said up to five five hundred thousand dollars tax free in profit from the living flips and if you're a single individual that's two hundred and fifty thousand dollars because if you live in a home for two years and you sell it you're not taxed on the gains right but if you live in it for less than two years than it's not technically a living flip it's just a flip and you're GONNA pay tax on the profits you make from selling out house right. Yes rush if you own the home for less than a year. Even if you're living in it I believe it's taxed as regular income if you sell it after living there for one year but not living there for two two years. I think it's taxed as long term capital gains which I believe it's fifteen percent yup but if this affects you please talk to your. CPA okay all right. Great Advice Vice. Well I WANNA know more about like what was the hardest part of living in the home while you're actually working on it right because obviously you weren't in. Its while the second story was being put on right. Oh yes I was. Are you serious okay. Well first of all I want to know about that but I mean the reason I ask. This is because we added onto our home my wife and I and our kids we lived through a home renovation automation and man it was one of the hardest things we've ever done so we've always lived in our flips because we're cheap and we're not gonNA pay rent at one place or pay a mortgage one place pay mortgage. Another place does live there. We chose to live in flip in Colorado Ratto in the wintertime. Because that's when the construction workers were available so that was freezing cold. It's up for everybody. I can sit here and make it sound really really awesome awesome because when I cash a check for a hundred thousand dollars that makes me happy. Not every flip is going to give you two thousand dollars in profit but once once you sell it. It's really easy to be like. Oh that wasn't so bad. It's like childbirth. You have a baby and you're like Oh my goodness it hurt so much to have a baby and then once the baby comes out. You're like oh I love this baby I can totally do it again. See just forget about the pain but it is a mess like it is. Oh plan to be out of the House during drywall all day and hire somebody to come and clean it for you when you're done because that's the messy part. But you know when you you pull the drywall down to do whatever you're doing behind the walls you still have outer walls. So it's not like the whole houses ripped apart and there's varying levels levels of living in flipping and you can do just cosmetic flip right now. The House that we're in on my goodness we got such a smoking hot deal on it. But it's basically Lee cosmetic. I have an ugly kitchen but I can use it like you're having it's still hold stuff in the other appliances our new but the cabinets are really ugly the countertops the top. Is this white tile countertop. And I've been living in my house my other house for about five years now with a solid surface countertop so having tiles title countertop Mike why did they ever do these all the grout gets all dirty and gross. Of course why is full of crumbs. It's the worst. Yes well mini. I mean that's something that we haven't really talked about on the show much is living flips. But I love it because there are a lot of people that after hearing you know how you do it. And the money that can be made from mm-hmm it meant living flips are just an awesome to go for a lot of people especially if you're a dealing with the mess while you're doing it so yeah I love hearing. That party started. Bow You really. I really want to get into selling a home and helping people figure out how to do that. Especially considering this is airing in February a lot of people are thinking about selling their home. So we're going to get into that right after the break brought to you by capital one where you can open a savings account in about five minutes. It's an five times. The national average. Just imagine five times more savings toward that overdue home edition or Joel. Maybe even that hot tub. You've always wanted. I've always wanted one. This is banking reimagined. What's in your Wallet Capital One? NA member FDIC. It's all right we're back from the break and we're talking with Jensen about selling your house for top dollar and Joel like you mentioned. I think a lot of folks are considering their house. It's kind of at the beginning of the year. The ramping up. It's about to be spring so many that's our question for you. Next as win is the best time to sell the house. We've seen the stories about how the spring season it seems to be be the hottest time to sell houses and starting earlier mini-van. I've seen stories about spring housing season starting in January this year. Because there's so much pent up demand yeah so okay maybe you remember back in two thousand eight there were. There was this Housing crash because people were losing their jobs. They weren't buying and selling houses when you're not buying and selling existing houses. You're not building new houses. So there is this huge glut of people who want to move but can't can't because there's nothing on the market where they want to move but they can't because they don't have a job and now they finally have a job and all these people wanNA move. I've seen the less three four four years at twenty twenty so probably the last four years every spring and I live in Colorado where spring selling season starts in February every spring. There is just this mad rush of people to put their house on the market so that they can go find another house so the best time of the year to sell. Oh is during the spring selling season because of that's when the most people are looking so economic basic law of Supply and demand the most people are looking the more demand there will be for your property. I just helped somebody buy a house. We closed on December thirtieth. There were no other offers offers on this property. Because nobody's looking between Thanksgiving and Christmas like that's the worst time to try and sell a house but now is the best time to try and sell the house so if you have the house to sell you need to get on the market as soon as you can and you need to have it looking as good as possible now if it needs a brand new kitchen in a brand new bathroom and all the things that it needs it can still be clean. Obviously the nicest house is going to sell for the top dollar but the cleanest house is going to sell before the dirty house and it's going to sell for more money than the dirty house will so the best time to sell L. is in the spring. You want to know what it is you're selling for if you've got a job transfer you kind of don't have a lot of leverage selling your property if you I have a new baby on the way and you're living in a one bedroom condo you kind of don't have a lot of leverage but if you just want to sell because you're sick living here you know maybe we want in a bigger house. You have a lot more leverage and you can be more choosy with with what offer you accept. Yeah so so you say leverage what do you mean by that. Is it just kind of like you said. Is it being picky about about offers and just waiting longer or yeah. What do you mean by the APP? Yeah well so. Let's let's use the one where you have a baby on the way you have a one bedroom condo. You feel like it's not big enough for you. You need to buy a new house you moving with a three week old baby is a terrible idea asked me. I've done that twice stupid. Move before the baby comes so you feel more pressure to accept whatever offers out there. So that's really what I mean by leverage whereas when if you decide you know oh I'm going to sell my house. I'm sick of it when somebody comes in with a really crappy offer you can be like no. I'm not going to accept that and you can either pull it off the market or figure it out. Wait for a better offer will in your opinion. What are the big differences between selling in owner occupied property operative like? It's my personal home. I live versus an investment property. That someone selling oh so well. An owner occupied property. You have more control over. What the property pretty look like obviously trying to get top dollar for it? You're going to make it look as nice as possible. You're not gonNA leave dirty dishes in the sink and crumbs on the floor are whereas if you're selling you'll might surprise you filthy animal okay. Everybody else listening. Don't be like Joel. So so if you're trying to sell an investment property that has tenants in it it's not going to show is nice because your tenants are probably not going to care about the appearance as much as you are. So it's kind of a what should you do. Should you wait until the tenants are out and then try to sell it. But then you're not. Ah You're not getting rental income from that during the time that there's no tenants in there or do you try and sell it with tenants in there and just say hey there's tenants sorry you know that's That's a bit of a gamble there. When you're selling a house that you flipped especially if you haven't lived there you in a stage the house you WanNa have really nice furniture in in there and make it look as nice as possible because you are trying to get the highest dollar for that Gotcha Wall so many so? Let's say someone has decided that they want to go ahead and sell their home. Look you mentioned mentioned to have it clean stuff one you laugh you laugh but that become a real estate agent and you will walk into these home did they eh. Did they know what's coming but on that note right. What are some of the other things that need to be done to the physical house to the property in order to get ready for the listing listing? Okay so if you're listening to this show. Something's wrong with your house. The DOORKNOB doesn't open right or you have to like lift up the sliding glass door to get it to close or whatever fix that that's going to show up in the home inspection the buyer's going to discover it at some point. Fixed those weird little things that you know. You should be doing that window. That doesn't close quite all the way. And you have to hit it from the outside like all those things because that's just going to cost you money later when you're listing your house. There's this thing called the material defect. It material defect can also be pronounced very expensive to fix. You need to disclose those if you know or if you should have known on like the roof is leaking. There's black mold in the room in the attic. You should have known that there's black mold get up there and look at it you should fix that. Talk or disclose that that's an issue if you don't and the buyer can prove that you knew about it and didn't disclose they can sue you and they. They'll probably win. which is is kind of a scary thing? I probably can derail the show there but fix the little things the broken tile in the kitchen replace the tile put linoleum. AM In fix that. One tile. Make the House look as Nice as possible because you're GONNA get low palled on the offer price if you don't well I think you're you're completely right on that and I think one of the things that we have a problem with this humans. It's like we look at our house and it's harder to see the faults and so we almost maybe maybe even need a friend to come in and pick our house apart to a certain extent so that we know what to fix it can't that can't that be helpful. Yes honest friend exactly. You don't want some yes man friend but you want somebody to come in and be like hey it smells like you have a petting zoo in your house. I'm sorry if you have a cat ninety nine percent of the time it smells like you have a cat in your house. Yeah I'm probably not going to buy your house if you have a category if you have your buyer might have allergies if you have have a dog Oh my goodness please. Don't leave your dog at your house. During a showing had a neighbor come over and walk the dog or take them to their house or even board the dog. especially if you're I listing the House I went into a house. You knock on the door and you hear these dogs barking like what is going on here. You Open the door five of the biggest dogs. I have ever seen like it behind a baby gate in the master bedroom and all I can think of as they're going to knock down that gate and come attack me. We didn't even go in like. Don't have animals in your house when you're trying to sell the house and if you do clean the litterbox every day like wipe up after the dog. You know pick pick everything up to the cleanest house is going to sell. The nicest smelling house is going to sell. And you can tell when there is like those little glade plug ins you can tell. When that's covering up the smell of DOC so so when we're talking about getting these repairs done right? You have your picky friend. Come in and be your house is not up to snuff. You need some work. Do you have any suggestions. Any guidelines on how people should go about thinking about doing repairs themselves or or hiring someone to do them should they be kind of trying to tackle the little stuff on their own and saving that money for the bigger things might be wrong with their house or or what do you think how should we handle that well. Well let's look at what's really wrong with your house. If you're painting needs touched up anybody can paint. You can get a paintbrush an account of paint and touch up the little spots that your kids knocked into. Anybody can clean anybody can back you. There's things that you should do yourself. If you have a leaky faucet. You should call a plumber if you have you want to change out. All the electrical fixtures like all the light fixtures because they're old and brass and kind of outdated have those ready but call a professional and spend the money on that now I am a big. DIY person and I would say that electricity isn't that hard but the time to learn how to wire a house is not when you're going missile. It maybe on your own diamond your property I'm watching. TV or trying to become an amateur electrician. I got this. That's why not gonNA work out. I'm recording this in my office where I just installed six can lights all by my girlfriend. Wow that's totally impressive. I've personally I've never installed electrical for me. It just totally scares me. Like we've talked about this before on the show because I have not sat down and actually learned it but I think once you know it you know it and you can feel confident but I lacked confidence right now. Well I will invite you over because I have a lot of electricity work to do in my house. Oh come over anytime and I will rearrange. My Rehab schedule to do lights. Lights was one of the outlets or whatever But I will say. I should caveat this with my father-in-law is an electrician. So he has shown me see how to do things he showed. He showed Carl how to do things. And then Carl showed me how to do things step number one turn off electric city the breaker or the real question is how come you are the one doing all the electrical work and it's not Carl. He's the one that's got the electrician heritage so well because I was calling video video vigor. Pockets doing it for work. Well so related question them any real quick when we're talking about repairs right like the things that you need to get your your house. Basically up to up to par wind does it make sense or does it ever make sense to make improvements on the property just for resale. Like you know you hear people doing that. Where they've I've had the worst countertops for the twenty years that they live there or or even just a few years but then right before they sell it they go through all these small renovations to get ready for the listing? Does it ever make sense to go ahead and do those things yes. Would you like me to elaborate so you walk into a house and it's got a decently out you'd like the kitchen. You like the bathrooms but you cannot get over the fact that every single wall is painted. Fluorescent is an orange. If you're selling this property your agents should come in and tell you. You have to repaint all of this. Nobody's going to buy this house in this fluorescent orange. You can actually they get a really big discount on a property. Just because they didn't paint. What about those bigger improvements like potentially remodeling a bathroom or or completely redoing a kitchen? The oftentimes you know what you read is your return dollar for dollar is not going to make enough of a difference right. Like you're you're making sixty cents on the dollar when you renovate a kitchen or seventy cents on on the dollar when you renovate a bathroom. So does it ever make sense to do a bigger remodel like that before you sell the house. I think it makes sense if you are doing the work yourself self so we just did a bathroom here in the house. It costs us a thousand dollars. We pulled out. I don't know why they do this but in Colorado the carpet the bathrooms through GMS disgusting pulled out of the carpet. We pulled off the wall paper. We put a new vanity a new toilet tiled the floors painted the walls and then behind the toilet and vanity. We put this kind of like ship. Lap Board up all of the materials. Were we're a thousand dollars. Plus you know time. I don't think about the time I know a lot of people are like. Oh you need to pay yourself well. I just remodeled the bathroom for a thousand dollars. I don't what to put my time into. It is different if you're getting ready to sell. Your House carpeted bathroom versus Taio L.. Bathroom the bathroom is GonNa make the house sell faster. I'm going to look at that carpet and think that's disgusting. It's got mold. It's got urine stains like there's a lot of disgustingness gusting nece in a bathroom. I wanted to be crisp and clean. And that's what the new one looks like. So if you're doing the work yourself. You should absolutely consider doing that before you put the House on the market but but again going back to your. Why are you selling it? Because you've got a baby coming you really don't have time to put that work into it. took us a whole week but Carla's never job so and I say that lovingly is retired but I sometimes call him unemployed. I'm sure he loves that. He thinks argued that make you feel that he's like I don't care well we're talking about you. Know being able to get a lot of money from selling your home and so one of the ways that you might be able to save money when it comes to distilling. Your House is to do a for sale by owner. And so we're GONNA get the VATS and a few other things right after the break Support for this podcast and the following message come from e-trade investing. Your money shouldn't require moving mountains no matter how much or or how little experience you have. E- trade makes investing simpler and for a limited time. Get One hundred dollars when you open a new account with just just five thousand dollars. It's all about helping your money work hard for you. For more information visit EATRIGHT DOT com slash learn more e-trade securities LLC LLC member s IPC. All right we're back from the break. We're talking with our good friend. Mindy gents talk about how to sell a home and get top dollar for that home amid e we just talked about how. Somebody's house their property. It's all set up and ready to go hopefully now. They've made the repairs declutter. They've cleaned it so let's get into. Who is going to sell the house? So what's your take. How do you feel about selling a home by owner? Should phys Bobi illegit consideration or is that just like a stupid move for people yes to both of the above. Joel's favorite answer so I am a licensed real estate agent in the state of Colorado. And if you'd like to buy a home give me a call but I also wasn't a licensed real estate agent in any state and I did sell my house for sale by owner and a lot of people want to put the time in to sell their house by themselves. They would've saved the commission It is a violation of the Sherman Antitrust Act to say that the going rate is whatever but typically a real estate commission goes for between two and a half and three percent per side. So there's the selling agent and the buying agent so around five and a half or five to six percent of the sales price goes to the real estate agents so some people look at that and they think Oh my goodness I'm going to my house for four hundred thousand dollars. I have to give somebody twenty to twenty four thousand dollars to do this. I'll just do it myself. I understand that I was in that same boat. And if you're willing to put in work you're willing to do the showings you're willing to do the advertising you're willing to accept the contract and read through all the stipulations and all of that then. FSBA was a really valid way to sell your house. If you're not willing to do that if you don't have the time to do that you're too busy. You don't feel comfortable doing that you should they use a real estate agent the I.. Buying is not something that I really have a lot of experience with. This is your zillow's in your open doors and that kind of thing where somebody will you list you say I want to sell my house. They say. Hey we'll buy your house. Here's the price will give you. And they say we'll we'll give you four hundred thousand dollars for your house minus a ten percent commission minus these repairs are going to cost twenty thousand dollars so minus that minus minus minus fest and in the end you typically end up with less money in your pocket than if you went with the traditional agent or you sold it for sale by owner. It all goes back to your. Why why are you selling the house? Are you selling it because you need to get out of it right away or are you selling it because you're sick of it when you list with a traditional a real estate agent they put it on the MLS. The multiple listing service. It makes it available in a database to every real estate agent. So if you're looking looking to get the most eyeballs on your property. That's the way to go but when you do that you're giving up five to six percent of the sales price if you WANNA go. Oh for sale by owner. You can list the property plant to sign in your front yard. You have an open house yourself. You can start marketing. The property and it doesn't start counting days on market which is an indicator of how long the house has been for sale When it's on the MLS as soon as you put it on the market? That's one day on market the MLS seems to be one of the most important things. You're listening to home right. That's where all the agents go in order to know how to show to their clients. So how important is it to be on the MLS and if you are attempting to do for sale by owner. Is there way that those people can then get their home on the MLS. Yes there is still yet big on the is where all the agents go. That's where I go when somebody calls me up and says hey I want to look for a property Operti let me go to the let me show you all the properties that are listed right now and I get them a list based on their sales price or how many bedrooms they want or whatever I send them a list and they they go through it and they're like oh I wanna see these three houses. I don't have the time to knock on everybody's door in the city that we're looking at to see if they're interested been selling their house. I don't have time to drive around and look for for sale by owner signs and I don't go on craigslist and all those other ways to find for sale by owner properties. I go to the MLS. Because that's where the majority of the properties are. I WANNA say ninety percent but it kind of sounds like I'm just making that up so I'll just say ninety percents of homes are on the MLS. If you want the most eyeballs on your property you WanNa be on the. There is a way to have your cake and eat it too. You can N. B. for sale by owner with a flat fee. MLS listing service. So you pay a real estate agent a flat fee five hundred dollars thousand dollars to put your property on the MLS. They don't Take Care of showings. They don't care. Take care of negotiations they don't take care of anything all they do is listed on the mls for you so you get all the eyeballs. But you're still just doing all the showings yourself remember. I said that it's two and a half to three percent per side approximately. So if you're not offering the buyer's agent agent some sort of incentive to sell your house they may not show it. I think this is kind of a jerk Turkey move. You should show the House that your clients went to see and legally. You're supposed to show the House that Claes what to see regardless of the remuneration into yourself but there's no law that says what order you have to show houses in so the House that offers one percent selling commission is it's probably going to get shown blast if at all if you know though that like the physio route right for sale by owner. If you know that that's not gonNa work out for you. You've got a full time job. You don't have a lot of time to devote to the move. Sounds like maybe going a real estate agent that might make the most sense. But how do you go about finding the right one. Like what questions. Should you be asking specific specific agents when you're when you're interviewing them essentially You should interview your agent and you should interview a lot of agents. You shouldn't just like drive pass. Somebody signed to be like. Oh Oh I've seen that before. I'll call that person. You should absolutely question your agents. What would you list my property at if they answer that over the phone? I'd be leery you need to come and see my house. You need to see all of these amazing improvements that I've done. You need to see the house itself. Walk the house smell. The House listened. Listen to the House and be in the house in order to give me a price. How did you come up with that price? Oh I really think that this price will work. A property doesn't sell for what you think it's worth a property sells based on cops and COMP is a comparible property located near the property that you're trying to sell similar in bedrooms and bathrooms and you know so similar in layout similar in condition condition that's a comparable that has sold recently. So if you can if you're agent your potential agent says oh I can get you four hundred thousand dollars yes because I just know that. The market's going up so I know we can get this well. Why do you know that? Show proof that that's what can happen. Because that's what the the appraisers are going by. When you get a loan from a bank they don't just give you a giant pile of cash? They make sure that the property that you're buying is worth that much money so they're going to send an appraiser out if the appraisal comes back low they're not gonNA give you a loan. Let's say you have the property under contract for four hundred thousand dollars and the appraisal comes back at three seventy five. The bank is not going to give you a loan for four hundred thousand. They're going to give you a loan for three seventy five and you have to come up with the difference. You have to ask the seller to drop the price or you have to walk away. So I think asking the agent how they he came to the price that they came with is a good a good first step. When everybody's saying oh well listen for three seventy five and this agent says elicit for four hundred a lot of times agents will say that to get the listing and then when it doesn't sell they're like oh you should drop the price of three seventy five? We'll by that time you've already got the days on market. Your listing is considered stale. You've dropped the price so you start to look a little desperate so you definitely want to know how they came about that price before before you sign a paper with them you know how they communicate you want somebody who communicates the way that you communicate and if all you want to do is have phone calls you. You don't want an agent who text you an emails you and that's that's valid however you want to communicate is valid but you need to find somebody who communicates the way that you can communicate. How long have you been an agent? You could be very experienced. Be Part of a team. And then you're never going to actually work with Mindy. Jensen the agent. You're going to work with with one of her underlings because Mindy is so busy. She can't work with you. If you WANNA work with Mindy you WanNa make sure that you want to work with mindy if you don't care if you just want on her name on your side and that's fine too if you just got your licensed. That doesn't necessarily mean that you don't know anything I've been buying and selling real estate personally really for twenty two years but I have been a licensed agent for six years so when I first got my license I still knew a lot more than a lot of agents who had been doing it for a while just because I had the personal experience so having a newbie agent isn't necessarily a bad thing you just you need to know that that's what you're getting into. That's great advice for picking the right agent. That's a lot of stuff to a lot of check marks. I think people can then look to to hit in order to make sure that the person they're hiring to this really really important job that could potentially save or cost them in the tens of thousands of dollar range to make sure they're getting the right person on their side. Yes I think that's some great stuff. I WANNA talk about market conditions for a second to me personally. I'm not currently planning on selling any of the homes that my primary orienting my rental properties. Nobody's anytime soon. But I guess I have a question for you like should I be considering selling something. Because when the market conditions are ripe for a seller color should somebody that hasn't thought about selling home maybe start to consider selling based on market conditions. Alone like what do you think about that. Wow how that's a really interesting conundrum. Because I do believe that with not getting to political Michael. We have an unstable political climate in Washington and that can affect the housing market that can affect the economy of the United States. At this time that we're recording. We have some issues with Iran right now and that could affect the economy and the general market the world market if you WANNA NSL. Maybe now's a great time to sell. But why do you want to sell you. Just said you're not interested in selling. Why would you? Why would you move to a new market? I personally personally have moved this twenty eighth home so to me. It's not a big deal to move. Wow I'm also not saying well what do you let them. Every two years you can rack a lot of them up. Like I wouldn't necessarily just say move for the sake of moving if you WANNA move to a school district if you want to move to a bigger home or a a smaller home now certainly a good time to start thinking about selling but you know if you're not thinking about selling if it's not in your plans then you don't have to accept the first offer that comes your way you don't have to accept an offer that you don't like I don't know you could always put your house on Zillow make me move. You've got Karl. Put our health zillow. Make me move it. Six hundred thousand dollars. Somebody reached out to him. I'm moving along. I need a house. Can I buy yours like no. We don't have any place to move to. I think that's a great way to think about it if you put it this. Just astronomical price on something like Zillow make me move and somewhat is willing to pay. Hey that price something. That's above normal market conditions. And you're like I'd be happy to sell it if I was able to get all that much but it's just not likely than I think that's a reason to sell potentially but yeah I mean I just think it's interesting that with these conditions where there is just incredibly low. Supply rates are so low especially when we're talking about the cheaper homes uh-huh the starter homes. There's just not enough of them out there for buyers and so the prices have just gotten jacked up in a big way and it'll be interesting to see what happens over the next few years because I have a feeling. That's not sustainable. I completely agree. And it goes back to two thousand eight and two thousand nine and two thousand. Ten builders stopped stopped building houses. They went out of business and they didn't come back. When the market changed and now there's a favorable housing market the builders have found on new jobs and they didn't come back? There's a builder a couple of builders in my area that will give you a job training. You pay you while you're being trained and then you have to sign like a one one or two year contract with them to work for them building houses but they'll teach you framing an electric and plumbing and roofing and like all the things that go into being a A homebuilder because they can't find anybody to hire so it's not sustainable to have these these starter homes going up so crazy but there were so many homes that weren't being built now that everybody has jobs again in. The economy is humming along. There's no place to buy so you pay more. Because that's the only houses is there and you pay more in order to get the house and all the homes that are currently being built seem to be in the higher end all the apartments and and I want to say all but most of the homes and apartments that are currently being built are on the more expensive side and that's just because there's more incentive right now especially in this economy to provide those types of housing housing and so there's just not much in the low end and because of that it's really check those prices up against deal right and I mean how much does it cost to frame awal. You can buy like you order the framed wall from the wall framing company. Or whatever it comes to you it's a twenty by fourteen wall. Paul already framed out to slap it together. You Slam. It's pennies more printing a t-shirt it costs twenty dollars to print won t shirt but to imprint. Twenty t shirts. It's like twenty four dollars fifty t shirts. It's like twenty eight dollars. It's the all the setup and all the all of that so once. It's you get people to crank out of house. I will pay more for a five bedroom house than I will. A two bedroom house but the builder doesn't it doesn't cost that much more to build a five bedroom house versus a two bedroom house. So why would i. Why would they build these little houses that I'm not making much money on when I built these big houses that I make a ton of money on? Yeah so true mindy. Hey this has been a fantastic conversation. I think our listeners. We're GONNA get a lot out of this especially the ones who are actually considering selling their home and we're going to give away a bunch of copies of your book how to sell your home which is essentially. I mean. It's a guide and it'll take our listeners. Step by step through the entire process of thinking through. Why is it? You're selling through the entire process. We touched on a lot of these topics but there is way more to it than what we just discussed. And Mindy we mentioned the the podcast that you host where specifically kinfolk find you online. I am all over bigger. POCKETS DOT COM. I'm the community manager there so I am all over the forums. You can if you are not a member of bigger pockets and went to join. I will be your first colleague. I am also on every social media platform except for Tick Tock. 'cause I don't understand Dan that one yet and I am at continue that one. Yeah Yeah exactly I am at Mindy at BP Mindy Y at at BP awesome well. Yeah people can find you there and mindy seriously awesome hanging out with you. Thanks so much for taking the time to join us today. Oh I'm so excited to be on on how to money. This is like bucket. The bucket checklist item right. A bucket list checklist item. And I love talking about real estate so if somebody has a question about realistic please email me mindy at bigger pockets dot com awesome. All right. Well thanks so much many. Thank you for having me on. I really really appreciate it all right. Joel what a fantastic conversation. We had with Mindy shed a lot of great advice on just some of the practical steps that we need to take before we sell our comb so on that note or maybe not. I don't know what you're going to say. But what is your big. Take away from our conversation with Mindy Man. I think the thing that struck me the most was when she said something. Something is wrong with your house and I think there are so many of us truly. Who have this kind of pollyannaish view towards our home in our is someone would walk in and point a couple all things out and we might get frustrated or annoyed that someone would think that those things are wrong with our home when talking about my home screen and maybe some of us don't have that maybe we can see see all the flaws in her home very clearly? But I think you need to look at your home with a very critical eye before you do sell it so yeah anything that you can do with obviously just just the easy things painting and cleaning but then on top of that all those little things that might seem insignificant that you can fix you can take care of on the front end before people con to take a look at your home while. They're considering the price that they're going to offer even just a doorknob fix or making sure that window closes properly right. Those are Kinda the little things that can make a big impact and they can stick in a buyer's mind so yeah something is wrong with your house find out what it is and get it fixed so that you can make top dollar for your house. That's what stuck out to me. And what many said Nice iceman. Well okay so what I'm gonNA share is actually really similar to that. But it doesn't have to do with your specific house or features of Your House but it has to do with what's in your house. Also that being your pets many mention just whether you have a cat or whether you have a dog you probably don't notice the smell and I will say from personal experience -perienced for years having a big gray Dane you get used to the smell but it's not until you don't have a pet that you realize oh man it smells really fresh and clean in here. So even the smallest animals can have lingering smell goldfish and hamsters out to do Seriously Hampshire is actually hamsters and Gerbils and rabbits. Abbott's the Goldfish. They don't really smell right. I don't know then we'd probably wetness and get out of there too but either way I think just kind of keeping your pets in mind. You know she. She mentioned definitely not having them. They're like a friend walk them. I think. Even maybe a step beyond that. If you know you'RE GONNA have a string or a series of showings maybe for one week where you're going to hit it real hard. See if a a friend could hang onto your dog for that week maybe your parents maybe your in laws. Maybe they can watch the dog. Maybe they can take the cats to where you can almost get a fresh restart on your home. I was really thinking about that when she was talking through. That and I know much more sensitive to the smell of animals. Now that I don't personally have a pet and so there are a lot of folks Out there obviously who do have pets but there are a lot of folks who don't have pets and who don't want pets and who do not like the way that they smell. Yeah and that could really make or break. I mean some buyers might say this smells like an animal and I don't want it and even if you're completely used to it. There are a lot of people that aren't and so. Yeah that's definitely something to be aware of. Good point are no matter. What were your thoughts on that we had on the show today? We had a beer better for Josh gave us from Casa agree out in California. This was called slamming at the club and it was a clean clean cut. American lager is within this sweet punk. Rock can design the reason. It's called Slam. Another cloud arose reading the label. It's kind of a tribute to hardcore punk rock which is a specific type of punk rock that originated in southern California. I gotta be honest. I'm reading some of the band's read some of them. There's no good I don't know any of them but it before our time as well all right I feel better. Yeah there's one call. Gosh I can't even remember these. You can't read read some of them. Fistfight on ecstasy is one of them which that's one of the more tame one on they known but yeah this one's got slamming at the club. It was a lager style that we have often. But like I've mentioned before the more often that I drink some of these. Just well-crafted loggers the more. I appreciate them because I see what loggers are actually supposed to taste like. They're not flavourless. And they're not totally skunk. It's nice blend of the clean drinking crisp beer. That has all that nice beer flavor but without that credit after taste that you can kind of come to expect from some of the mass produced lagers out there. Yeah I mean I think clean clean and crisp or the two words that describe this and that described any really well made lager. The folks at Casa agree. They really know what they're doing. I feel like every we've had a bunch of beer styles by that brewery at this point in every one that they've made just is on point. The flavors are beautiful and this was no exception. This was a great lager from them. I really enjoyed it and so yeah big. Thanks to our Buddy Josh for sending this one our way thanks. Josh are and let's get around to that giveaway. Mindy is generously giving away ten copies of her book. How to sell your home and if you WanNa be entered into this giveaway all you have to do is review our show? So if you haven't left to review for us we really appreciate it. All you gotTa do is go to Apple podcasts at click five stars preferably and say something Nice about the show and what you've learned or you can also if you're not an apple person like me go to Stitcher DOT com. You can leave a review there and then shoot us an email l. at how to money POD AT DOT com. Let us know the screen. Name that you've left the review under and if you've already left her of you in the past just an email let us know that you want to be entered into this giveaway and you can be entered heard into Yemen. That's right and folks listening. If you WANNA be entered in. You have until Friday at noon. Make sure you get that email into us by Friday at noon. That'll be when we closed that giveaway and choose the names angel. We'll have our show notes up on our site like we normally do at how the money dot com and I think that's going to be a man so until next time best friends out friends out in this episode is brought to you by office. 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