french quarter architecture (Photo credit: abundantc)
Everybody likes unique homes… maybe not the same unique homes, but homes that are unique to their needs and desires. But, when it’s time to move, a unique home can be a REAL challenge to sell. In effect, it takes finding someone else that sees the same value in the property in order complete a sale where everyone leaves the closing table with a smile.
Financing a unique home can ALSO be a challenge. Now, you don’t just need to find a buyer that has similar needs and desires for their home, but the appraiser needs to be able to justify it through the use of comparable properties. Comparable properties might be pretty slim… since the very definition of “unique home” would seem to preclude comparable properties.
What makes a “unique home”?
- Unusual interior features… maybe a 30 seat movie theater, 10 car garage, recording studio or maybe even a smaller house with a commercial grade kitchen.
- Architecturally distinct… this can be something as “mundane” as a house that doesn’t fit the character of nearby homes. A modern, minimalist home in a neighborhood of traditional homes would be unique.
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Falling Water (Photo credit: spike55151)
Different type of lot… like a 10 acre lot tucked into a neighborhood with ½ acre lots, or a ¾ acre lot in an area loaded with 20 acre mini-farms.
- Homes with historical significance… whether we are talking about a house like “Falling Water” (famous Frank Lloyd Wright design) or the Lalaurie Mansion (a famous home in the French Quarter of New Orleans, purchased a few years ago by Nicholas Cage) or even a home owned by a notable person from history.
- VERY different homes… a house built to look like a shoe, or an earth-shelter home. Lots of very high end homes fall into this, just because of the cost and limited market for them.
Selling a unique home involves a lot of challenges, both for the sellers AND for their real estate agent.
- They may take a substantially longer time to sell than other homes. They need to have the right buyer… and they have a much smaller buyer pool because of their unique attributes.
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Image via Wikipedia
The sellers will often end up selling for much less than they originally hoped… even if they find the “perfect buyer” because of the problems that can arise during the appraisal and financing processes.
- In some cases, especially homes with historical significance, there might be substantial restrictions on the buyers (can you imagine what would happen if someone bought Monticello, Thomas Jefferson’s home in Virginia, and then bull-dozed it because they liked the lot?)
- The marketing costs and effort need to be much higher in order to have a good outcome.
There is a saying in real estate… Price fixes everything… but there are limits to that. In fact, over the last few years we have actually seen properties that couldn’t be GIVEN away. In Detroit, there were homes that were livable (not nice, but not caving in, either) that failed to sell for $100. The value of the underlying land was less than the cost of removing the house… and there was no demand for the house. The parallel in unique homes is that there might not be a noticable local demand for a house with that particular style. To sell a specialized home to a general buyer often means that the unique features are completely discounted, or may even be a liability.
So, “price fixes everything” may actually not apply in the case of some unique homes. Marketing might also not be able to overcome some obstacles. However, to get the best outcome, a combination of aggressive marketing, realistic pricing, and a realistic timetable are the solutions.
I have dealt with several unique properties… garage homes being the most predominant. The require a different type of service than many real estate agents are willing to provide. There is a substantial portion of the real estate community that “plays a numbers game” when it comes to listings. They figure that by listing a lot of properties, they will get a percentage that sell. By lowering their marketing costs and concentrating on funneling more into the listing end of the equation, they will get more sales on the closing end of the equation. They are much less interested in changing the equation to get a higher percentage fo the properties sold… and they have little patience for dealing with interesting and unique properties.
If you have an interesting property that you want to sell… or you are looking for an interesting property… around Atlanta, especially in Gwinnett County and around Lake Lanier, give me a call.
