How Not to Play Poker with Your Inventory

How Not to Play Poker with Your Inventory Homes May 21, 2008 Presented by Kate Kelley-Dilts, SCRP, GMS, CERC Vice President, Client Development-Western Region NEI Global Relocation Omaha, NE

Relocation Home Sale All transferees: • Home Marketing Assistance With formal home sale programs: • Pre-Inventory • Inventory 2

Home Marketing Assistance • For all transferees • Transferees engaged in the process – Educate and advise on today’s challenges • Key factors: – Partnering with a proven relocation Realtor – Pricing competitively – Condition – Marketing strategy 3

Maximum Exposure • Relocation real estate professionals • Ensure great condition and appearance • Best price out of the gate 4

Maximum Exposure • Internet is where it’s at!! – More than 20 photos generate 10 times the leads/views – Statistics show • 1 photo = 70 DOM 6 = 40 DOM 20 = 32 DOM • 1 photo = 91. 2% of original price • 6+ photos = 95% of original price • Location, location is now photos, photos!! 5

How NOT to Stage a Home Advertised on the Internet as a “Showcase Relocation Home” 6

Maximum Exposure • Attract attention – List at even numbers for two search ranges – Listing at non-round numbers between ranges: i. e. , $231, 102 – Weekly, bi-weekly reductions – Unusual open houses • Evenings, Sunday mornings • Make the interested buyer an offer 7

Marketing Actions • • Condition – improvements to compete De-clutter, de-personalize Staging options Know the competition – Foreclosures, construction, days on market (DOM), absorption rate • Educate and advise on competitive list price – Aggressive action with “stepped down” reductions – Add verbiage “home listed below appraised value” • Next steps 8

Marketing Trends • Guidance/mandate on Realtor selection • List price parameters – i. e. , initially 105% of BMA averages, then reduce – Adjust again if/when appraisals conducted • Transferee encouraged to entertain all offers – Listening to the news, articles, TV – Rely on assistance to evaluate purchase offers • Repair and improvement allowance • Home sale bonus • Appraisals to gauge listing price 9

Marketing Trends • Transferees consider offers less than Buyout • Formal home sale offers less than established price (appraised value) • Buyer incentives • Loss on sale (capped) • Short sales 10

Pre-Inventory • Preparation required – Before a home is purchased from a transferee • Review marketing strategy used to date • Order updated BMAs • Condition of home – What has been repaired – Bids on repair/improvements needed – Strategize on expense vs. value • Project marketing plan – List price to established value (loss on sale) – Advise on sale price to extended carrying costs 11

Inventory Marketing TIME IS MONEY Industry Average Home Sale Costs: Employee-Generated Sale Guaranteed Buyout Difference 9% 18% 9% Additional cost on home value of $250, 000 $22, 500 Additional cost on home value of $450, 000 $40, 500 12

Inventory Home Sale Challenges • • • Prolonged market exposure Market conditions vs. initial marketing efforts Curb appeal Condition – house is “naked” Marketing tools – Internet, creative approaches • Negotiations for highest price – Concessions that make sense – Critical buyers 13

Assessing Purchase Offers 14

Home Marketing Success • BMAs revealed “too much stuff” • Advised transferee to de-clutter and store extra/personal items • House showed much neater, cleaner • Sold in shorter timeframe Employee Sale = higher transferee satisfaction, lower company costs 15

Preparing a Home for Inventory Marketing • Pre-arranged for painting upon transferee vacating • Competition: supply of homes in area = 12+ months • Staging and neutralizing costs = $10, 400 • Home sold within 3 months • Saving 9 month’s carrying costs = $71, 800 16

Inventory Management • Resistance to pink kitchen • Extended marketing time due to new construction in local market • Immediate paint, appliances to compete • Reduced carrying time net savings = $17, 222 17

Challenging Home Sale • Remote location • 2 heavy smokers, 4 ferrets • Property required reconditioning • Ducts and floors cleaned, repainted, tear down shed Employee vacated upfront, repair immediately Sold in 90 days 18

Emu Ranch – SOLD!! 19

Fireman’s Dream • Condo across from fire station • Noise a challenge • View – direct and rooftop • Appeal to market buyers 20

Where to Park? • Home improvement resulted in no off-street parking • Added a front circle drive • Competitive home • Sold shortly thereafter 21

Functional Obsolescence • Attracted to home – until you opened the front door • Entry post a challenge • Staging benefit? 22

Walk Right In? • Stairs immediately inside door • Addressed in HMA, appraisals • Some things cannot be changed • Creative descriptions needed 23

Listed for a Year • 3 exterior photos online • Rehabbed historical home 24

Bright Colors • Transferee color choices • Neutralize or accent? 25

Relocation Homes Sell • With transferee’s knowledge of market • Proactive marketing plan • Put your best “house” forward – Realistic listing price – Best condition • Maximized exposure – Relocation Realtors – Web photos – Identify potential buyer pool 26

Resulting In • Increased transferee satisfaction • Managed home sale costs • Partnerships providing expertise The next concern ~ Transferees buying smart in the new location 27

Case Studies • • Round Tables Review Case Study Offer recommendations to sell the home Follow corporate policy provisions Recap all groups to gather ideas, input. 28