By Mark Nash
WHAT'S IN
* Sidelined home buyers. Family or lifestyle additions -- or changes made in buyers' households in the last three years -- are forcing those waiting out the market transition to finally get off the fence and say, it's time for our family to buy the new home that suits our new needs.
* Home uplifts. Not big renovations, but some new finishes that can visually tide over stay-put home sellers. Not a "gut rehab to the studs" new kitchen, but new flooring, countertops and appliances.
* Collaborative home pricing. The old days of home sellers configuring a home's price are out. What's new is that the seller -- with their agent -- looks at closed comparables, sets a price, then the buyer and their agent agree or disagree. In the end, a mortgage lender and their appraiser will set the price, as they are assuming the most risk in the transaction.
* Balanced reporting by real estate and personal finance journalists. Consumers learned in 2008 that the "doom and gloom" residential real estate market headlines don't apply to all markets. What's been lost in the foreclosure hype is that there are still stories of homes selling in short market times (in as little as 3 days), homes selling at full price and some selling with multiple contracts on the table. Existing home sales will be 5.02 million versus 5.652 million for 2007, a decrease of just over eleven percent, considerably less that the recent correction in the U.S. stock market. In addition, consumers are taking a more realistic view that more than five million homes were purchased last year -- in spite of the negative headlines.
* Creative home seller financing. Exhausted home sellers are turning to self-financing to move properties. Installment sale contracts and lease-to-own are the most popular and effective ways for sellers to begin receiving income from properties that languished on the market last year.
* The real estate agent as housing resource, not salesperson. Many modern-day agents aren't driven as strongly by sales; rather, they provide resources to help the consumer determine if they should buy or sell a home. Home ownership is not for everyone. Factors such as a job move in 3 years or less, marginal credit, and lack of interest in home maintenance can be reasons for a resource-driven agent to advise their client not to buy.
* Property tax appeals. With home prices dropping, many savvy home owners are appealing their property taxes. This is especially attractive to those looking to sell their homes in 2009. In a competitive marketplace, the house with the lowest expenses will have the advantage.
* House therapists. Divided partners in a home are increasingly relying on an independent third party (house therapist or coach) to bring household relationships to common ground on such prickly issues such as whether to stay or move, how much to spend on remodeling or decorating, or whether to spend anything at all. Unbiased third parties can outline the benefits and pitfalls of over-spending on a new larger home, and they can weigh in on a spouse's desire to over-improve for the neighborhood. With less equity -- and with the financial stakes higher -- smart couples can hire a home therapist to wrangle concessions and agreements instead of damaging their relationships.
* Architectural overhead garage doors. After years of bland vanilla garage doors, the architecture has permeated the most visible door in the house. Traditional styling has arrived with mullioned windows, faux wrought-iron hinges, and latches that provide the original non-overhead garage door look. Contemporary looks now include the adjacent siding applied over the door for a seamless look, much like the panels installed on refrigerator doors to complement cabinets in a kitchen.
* Loveseats. Furniture pairs and trios are gaining acceptance as the functional way to rearrange a living or family room. Consumers appreciate the ease with which they can rearrange smaller pieces or move extra pieces to other rooms. Plus, they're tired of sitting miles away from each other on over-sized sectional sofas.
* The master bed as a throne. With consumer spending down and more nesting at home, home owners are focusing on making their bed like an at-home luxury hotel experience. Posh linens, pillows and mattresses create a getaway without the need to leave home.
* Older war-horse appliances. Collectable working appliances from the 1940s through the late 1980s have found a new niche among homeowners who appreciate their rock-solid construction and durability. Harvest gold double ovens from the 1970s -- repainted a metallic red -- go from boring to bold. Coldspot refrigerators from the 1950s -- refinished in sky blue -- perk up the butler's pantry in suburban home. And the early 1960s dryer that looks like it's from a Jetson house -- painted pink to match -- punches up the in-unit laundry room in a condominium.
* Dining chairs that don't match. With consumers watching their non-essential spending closely and electing to entertain friends at home, many have found a quick pick-me-up for their dining room suites: mismatched pairs or single chairs. Feedback from friends or family has been favorable to this easy and cost-effective way to say "welcome to my cutting edge table."
* Obama-era paint colors. President-elect Barack Obama will add his own touch to residential interior paint decor in the White House. Bush-era plums, chocolate browns, mustards and sages will make way for parchment whites, cashmere yellows, and bright blues and golds.
WHAT'S OUT
* Fixer-upper homes. With larger down payments required by mortgage lenders and consumer credit cards mixed out, home buyers want a home to be in move-in condition. The DIY days are on the wane as buyers look to inherit new kitchens and bathrooms.
* Home buyers "circling" short-list properties. Overly optimistic buyers have lost out by waiting on a preferred property indefinitely, often for months, hoping for further price reductions or to wear out long weary sellers. This practice has backfired for buyers who practice this style of pre-negotiating. They often lose their short-list dream home and frustrate savvy price-right sellers. Ditto the bottom-feeder buyers.
* Real estate agents that started careers in the boom. It was easy for any new real estate agent to have instant clients during the boom years. After all, they thought the business was about order (contracts) taking. Now they've realized they didn't build a long-term client base during the boom or acquire knowledge about servicing clients' needs in a not-so-easy market.
* Home staging. This overused low-cost marketing trick for vacant homes (or occupied homes with longer-than-normal market times) is reaching an end. Buyers have had enough of the non-professional usage of assorted leftover props placed around a for-sale home to make it (supposedly) homey. Buyers want sellers to market the home as it is... and clear out the tired silk flowers and stale potpourri.
* Indoor-outdoor carpet. This type of flooring was once a staple of quick-fix home sellers for basements, balconies, screened porches and lanais -- but buyers have had enough. Many have told agents that inexpensive indoor-outdoor carpet is visual pollution, and it often masks flaws in a home.
* Track lighting. Thought of by homeowners to be a quick way to get an art gallery look, many prospective buyers usually take them out and discount their appeal. As one Gen-X home buyer said to me, "Why do sellers install them when they don't really have any interesting artwork or architectural features to spotlight? They bring undue attention to nothing."
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Mark Nash author of four real estate books including the classic 1001 Tips for Buying and Selling a Home has completed his annual survey of 839 real estate agents in all 50 US states and the eight provinces of Canada. Nash's survey is distributed each fall to subscribers through his monthly electronic newsletter 1001 Real Estate Tips.
What's In, What's Out with Home Buyers illuminates what's popular or what sours homebuyers in both the home purchase or sale transaction and home decor. Compiled annually from the trenches, it offers tips that cover the reality of buying a home, design no-nos for home sellers, and buyer must-haves. More than 450 media outlets in North America used Nash's 2008 edition. For interviews call Mark at 773-610-2074 or email him.
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