Mining Marginal Real Estate Listings for Great Deals

I've written before about what real estate agents should do if they're interested in helping their clients sell their homes quickly for the highest price possible. Lots of high quality property photos do the trick. It's not the only trick, but it helps prospective buyers decide whether a house is worth visiting, thus worth buying.

But what if, as a buyer, you want to get the best deal you can get on a property in your town? In that case, taking the exact opposite approach to searching may help you discover some hidden deals.

Think about it: Property listings with no photos get less traffic, thus less showings, thus less competition. Because of this, they end up staying on the market longer and end up selling for less than they otherwise would. All because the listing agent was too lazy to snap some pictures and load them to the web.

It makes me wonder how much energy lazy agents will put into other aspects of the real estate transaction from marketing through negotiating a deal. If they can't find the time to take photos, can they find time to negotiate a competitive closing price on their client's behalf?

So there's the opportunity: Dig through the dregs of home listings to find anonymous homes that will sell for less than they otherwise would. Sure, it's a major pain that you shouldn't have to go through, but the savings may make it worth the extra effort.

Nice thought about the lack of photos. Surely the ones with photos sell the quickest. Lack of photos could mean that the house is a real fixer upper, with nasty shag carpet, trashed front yord, and so on - you get the picture. if the buyer doesn't mind purchasing that kind of 'nest'... Aren't some things better left to the imagination?? It would be a real bargain hunters dream purchase!! What a deal!! Look what I found!! Only took two dumptucks to clean it out! Wow!! Never under estimate the power of sweat equity...

AJ, as I see it, there are buyers for every home. And every home would sell faster if people could use the web to find out what's being offered. People interested in investing sweat equity are going to look for the biggest opportunities that fit their skills. They shouldn't have to drive around aimlessly to see things they could see online.

Not to mention the time an agent could save by taking photos rather than driving people around to show them what they should show them with photos first.

I'm a big fan of photos and virtual tours myself. I use them all the time for exactly the reason you suggest. It is also my experience that most people are not looking for the "diamond in the rough". They are looking for the house in the best condition for the amount of money they can afford.

My guess is that most home buyers are not looking for the fixxer upper. They're looking for "cheap" or "a deal". This usually means finding a nice home (with or without photos), beating the Seller down on price and closing costs assistance and the requiring every repair - cosmetic or otherwise - found in the home inspection.

The other side of this coin is the glut of "short sales" and REO houses on the market. No amount of photos or lack thereof will compensate for the condition of the house or the hassle one has to go through to buy them (especially short sales). The lack of photos may not be necessarily the sign of a lazy agent (although that's probably true, too) it could be: the price is the price, it's in "as is" condition, take it or leave it.

Some photos help eliminate a lot of houses from a live, in-person visit while others tend to be, er, flattering by omitting certain aspects of the house itself or the house next door. Bottom line is that for the "plain vanilla type" sale, the "no photo rule" may be the chance for a good deal. Short sales and REOs? Eh!? Not so much.

Ken, I'd argue that in those "take it or leave it" situations, photos are just as important. Whatever it is people are buying, they need to be able to see it to know whether it's worth investing the time to visit.

I have written a few posts on this topic myself and a few about how bad the MLS photos are.

Well my opinions were formed when I was a marketing manager at a property management outfit. This was 5 years ago when rental was down and home ownership was flying...we really had to be dialed in.

1. Pictures rent units. We photoshopped the hell out of them, nothing over the top just bump the color levels (blue sky, green grass kind of stuff) and made them as big as possible for the applicable media. Make sure that you invest in a wide angle lens...a point and shoot digital camera isn't going to cut it. Take photos from high angle corner vantage points through a doorway or from a flight of stairs if possible. If there is a sliding glass doorway, open that up and shoot into the home from outside; making sure to get as much shot as possible without the door frame entering the frame of picture. Make sure that you have exterior photos from the summer, if all you have is winter...I would skip exterior photos.

2. Signs rent units- a surprising amount of people actually do not want to sift through the internet, they actually like driving around. It gives them a feel for the area and a "macro" view of the neighborhood.

3. As a general rule multihousing that showcased a photo of the signage or only external shots were usually crappy shotgun/flakjacket type joints. Your probably better off leaving photos out all together if all you have is an exterior shot. At least then theres some mystery.

I understand the concept of sifting through homes without pictures its the equivalent of searching ebay for miss-spelled listings. Do you have a program that would do this for people?

Comments

1. Posted by: Andrew Chau on December 23, 2008 4:40 PM:

I like your train of thought. I think this is along the lines of overhead and operational expenses. I like to use restaurants as my favorite example. Usually the restaurants with the fancy advertisements are the ones that charge unreasonable prices. One of my favorite metrics is marketing spend as a % of sales. I wonder if the cost of shooting, uploading, or contracting agencies to create ads or dress up a home is worth the additional foot traffic. If anything, the additional cost is folded into the agent fees.

Anyways, very interesting thoughts.

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