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Remind your clients that even if these “adverse situations” wouldn’t bother them as home owners, they could be the bane of their existence as sellers.

high voltage power lines

In 2001, when I first got my real estate license, I took a class at my brokerage about how to show properties. Seems silly, right? How hard is it to unlock the door? But this class was about practical ways to make sure the buyer focuses on the most important factors of a home. I still follow some of the tips from this class today. One of them was to advocate caution to a buyer considering a house with an “adverse situation.”

What’s that? It’s a condition that will affect the resale of the property. I remember the instructor saying, “When my past clients call me up and ask me to sell the house I helped them buy, I don’t want to then explain to them the fact that they back to a major road will affect their value.” That hit me. No, it’s not the agent’s job to choose the home for the buyer, but they do deserve to know that if they purchase a home with an unchangeable adverse situation, it will always sell for less than similar homes and may stay on the market longer.

Selling is stressful no matter what the market is like, but in a flat or down market, it is 100 times worse. So since we can’t predict the future, I prefer to talk to buyers up front about adverse situations — deal killers, I call them — so they know what they’re getting into. And what might those deal killers be? These are the six I run into most often in my business. If you’ve dealt with others, leave a comment at the bottom of the article.

  1. Power lines: I hadn’t considered this one a deal killer until one of my first buyers backed out of a sale contract because she feared the power lines behind the home would give her cancer. Then I learned just how popular this myth is, as buyer after buyer has brought up a similar concern ever since. Just like fears about cell phone radiation, people have come to worry that the low-level radiation from high-voltage power lines will make them sick — even though governmental studies have not found such a link. But perception is everything in the pursuit of a sale. Many people also find power lines aesthetically displeasing, so you may want to warn your buyers of the trouble they could face at resale.
  2. New subdivisions: Brand-new homes are a big draw for many buyers, but if your clients are looking in a subdivision that will be under construction for years to come, you may want to advise them that resale could be difficult for the foreseeable future. They’ll be competing with brand-new construction for however long developers are building in the area, and that will make their lives difficult for many reasons. Beyond the appeal of new homes, builders also have deep pockets and can offer many incentives to buyers that traditional sellers can’t. Don’t set your clients up to compete with that if they might want to relocate in five years.
  3. Neighboring a business: I once had a neighbor whose home backed up to the rear of a grocery store. Guess when grocery stores get their deliveries? All night long. Those delivery people didn’t care who was sleeping at 4 a.m. or whether they were being too loud for the new mom next door with a baby she was trying to put to sleep. Now, not every business is going to be this disruptive all night long, but just let your buyers know that if their neighbors aren’t home owners just like them, they may have issues to deal with.
  4. Environmental concerns: In some areas of Arizona, the west-facing backyard is an immediate deal killer. During summer sunsets — a time of day when many people are home — the back of the house heats up even hotter than it usually is around this neck of the woods. Not an enjoyable experience when you’re trying to relax after a long day. It also makes barbecuing on the back patio unbearable. Your location may have different adverse situations depending on the environment in your state. In Washington, where my brother sells, he tries to avoid homes in forested areas that might be in danger of burning down.
  5. Subtle noises: When buyers tour homes, they’re listening for noise from nearby airports, train tracks, or highways and major roads. They’re probably a little more oblivious to the barking dog next door or the neighbor with parrots and a full aviary in their yard — or a chicken coop. Sometimes these noises are only passing aggravations and aren’t permanent, but you should tell your clients that if they hear it now, they’ll probably hear it in the future. And that can affect the next buyer’s opinion when they’re ready to sell.
  6. Peculiar ideas of privacy: Speaking of noise, highways and major roads are an obvious problem at resale, but some buyers prefer backing to a busy road rather than another home for privacy reasons. If your client is one of these people, you should tell them they’re a rare breed. For most people, the privacy benefit won’t outweigh the disturbance of the noise. Make sure your buyers understand the tradeoff they’re buying into.

With all that said, you’ll have buyers who won’t mind any of these adverse situations. A friends home, for example, is in the flight path of a small nearby airport. It occasionally sounds like these planes are landing on his house. Why would he buy such a home knowing how it will affect his resale? It was an awesome deal — and I mean awesome. He was lucky enough to find it right at the bottom of Seattle's market in 2011. He knew what he was buying, and knows what he will face when he sells. For my friend, the value was there. So while you should keep your buyers informed of the challenges homes might pose at resale, at the end of the day, you always follow their lead.

For more helpful information read: What You Need to Know About Comps When Selling Your Home

The sales price of neighboring homes is only one part of the equation. Be sure that sellers understand the other factors that affect how their home compares to their neighbors'.

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