Odds makers understand statistics. Specifically they understand the likelihood of two events happening. As an example, if you drive down the street, what would be the likelihood of seeing an older Volkswagen beetle? If you are in Southern California, this would be pretty likely, it might only be 15 minutes before you saw one. Then what would be the likelihood of seeing a pink car. This might not be as likely as seeing a bug, but in our area I can think of several occurrences. Mary Kay cars are pink, and there is a bail bond company, Lipstick Bail bonds, that has at least 5 cars painted pink for advertising purposes. They are usually parked on the street in plain view. So both scenarios are VERY likely to happen.
But what would be the likelihood of seeing a Volkswagen Beetle painted pink? VERY UNLIKELY. This is the principle of understanding your marketplace and compound probabilities.
2440 Marber – Close to Fwy
There is nothing wrong with having to sell a home on a busier street or location we do it all the time. Some locations are more difficult that others. For illustrative purposes, lets consider the property we sold last year at 2440 Marber. This home was not on a busy street, however the 405 Freeway was visible from the home and there was freeway noise. All things considered most most buyers would prefer to not live with the freeway in sight. What percentage of buyers would consider this location. My best guess is 20% of the buying pool.
Now this home was also a fixer upper. Not in a bad way. But here are some “Before & After” photos. My experience is that a good majority of buyers “Say”, they will consider a fixer upper, but when shown the perfect fixer upper, like 2440 Marber, they quickly back peddle and change their definition of fixer upper.
In addition, even if the buyers have the emotional fortitude to handle a fixer upper, most don’t have the financial reserves, skill set, time and vision to take on the job. Also consider the mindset of the buyer that is OK with a fixer. These buyers are VERY location sensitive. They are looking for a deal, but only the right type of deal. One that when fixed up will not have flaws. Fixer buyers can be choosy because they are willing to take what 80% of buyer don’t want. But they will not sacrifice location. So out of 100 buyers, maybe only 20% at best (and this is optimistic) would consider a fixer.
So the question then becomes from a sellers perspective. How easy or hard will it be to find a buyer that is “OK with a busier location” AND is “OK with a fixer upper”. This is simple math. The answer is 20% times 20%. Only 1 out of 5 buyers will consider the location and only 1 out of 5 will consider the condition. Out of 100 buyers only 4 would be interested. This lack of buying interest will have a direct negative impact on the financial outcome for the seller.
One out of 25 is not good odds. It is the exact opposite of a term I have coined “Universal Appeal”. Which I define as “If 10 buyers were to walk into a home 80%-90%, would walk out and say they have interest.
It is critical to have a marketplace to sell into. There isn’t anything you can do about a flawed location, but the condition can be changed. While selling a home with a locational flaw OR conditional flaw is not as easy, we can always get the job done. But it is when a home has multiple flaws that finding a buyer can become a daunting task.
The key is knowing the local market and how buyers think. With over 40 years of combined experience, and over 1,000 residential homes sold, Penny and I have the experience to maximize your homes value. We invite your inquiry regarding real estate.