Selling the “Family Home”

Remember the house you grew up in?

Do your parents still own that house?

If not, is that house still “in the family?”

Of course, there are readers of all ages reading this post. If you are a REALTOR, odds are good that whether or not you have experienced the scenario that follows, you will have clients dealing with these very issues.

Whether it be Parents or GrandParents living in that HomeStead, the day will come when they (and the family) will come to the realization that they will not be able to maintain that BIG house . . . or that the house is now “functionally obsolete” for them.

If there’s plenty of money, the strategy can be one of “aging in place” through a series of adaptations/renovations to accommodate the limitations that aging creates – Elevators – Main Level Master Bedrooms – One Level living – In-home care – Gardeners – “On staff Maintenance Crews” etc.

The reality for most folks is that there’s NOT “plenty of money” other than the equity in the house . . . a somewhat paltry FIXED income from pension, retirement, or Social Security . . . and perhaps some savings . . .

BUT . . . medical expenses, inflation of the cost of necessary goods and services (Food), Transportation . . . are RISING!

The money may be running OUT.

Aging can reveal some “Barriers” that limit the support network

  • Pride – Not wanting to acknowledge limitations and need for assistance
  • Limited Local Family (estranged or Living afar) and Friends – “Relatively Alone”
  • Mental and/or Physical deterioration/disability
  • Meddling “Good Samaritans” – Neighbors and Friends who may not understand the gravity of the situation may offer well-intended (but bad) advice
  • The aforementioned financial scarcity – Failure to pay taxes, Insurance, Utilities, Maintenance could result in loss or deterioration of the property (Loss of Value/Equity)

When we stumble across similar concerns, how we REALTORS best serve (and in some cases PROTECT) these clients?

Having successfully navigated these waters several times recently, I recommend addressing the following:

  • Legal Concerns
    • WHO is the “Responsible Party?”
    • If it’s not the client, Does that person have the LEGAL authority (As Power of Attorney or Trustee) to make decisions for the client?
    • Is the client of sound mind? This is not something that we Real Estate Sales Professionals need to diagnose ourselves, but if we suspect such, I believe we serve best by recommending evaluation.
    • Are there any “Gold Diggers” positioning themselves to take advantage of the client? (Contractors, Scammers, or Potential Heirs in the event of death)
  • Financial Concerns
    • Valuation – What’s the house worth in today’s market? If there is any concern of “Sound Mind,” “Meddling Good Neighbors,” or “Gold Diggers” who seem to have inflated opinions of value, an appraisal by a LOCAL Appraiser is the best course of action to offer a “3rd Party Opinion of Value” from a professional who doesn’t have a dog in the hunt.
    • Income and Savings – Does the client have enough reserves to sustain a reasonable quality of life?
    • Debt – Is there a mortgage (or reverse Mortgage) on the property?
    • Taking all of the above into account, what is the probable “Net worth” of the Client after selling the house?
  • Property Concerns
    • Condition – What deferred maintenance is visible? Has the Client made any recent improvements? Are there any safety issues? Is there any correctable functional obsolescence How can we prepare the property for the market for the least cost?
    • Highest and Best use – In today’s market environment, who is the most probable Buyer for this property? With the Buyer buy it to live in it, hold it as a rental, flip it, or raze it and build something new on the lot? (These are important questions to ask so as to price and prepare the house appropriately)
  • Relocation concerns
    • When the house is sold, where will the client live?
    • Does it make more sense for the client to rent or BUY?
    • If Buy, all cash? How Much . . . and what equity will remain to live on?
    • Condo, House, Assisted Living, or moving in with family (Children) . . . Which?
    • Who will help with “Scaling Down” the furniture and belongings so as to fit in the new, smaller living space?
    • Can we build in enough time to make this transition smoothly without feeling rushed?
    • Family – Can the family coordinate such that there’s 1 person with the client for a week at a time rather than everyone showing up at once.

There are many other factors to consider and this work can be excruciating and rewarding at the same time.

In my experience, the client is facing a continual rush of emotions as other people show up to turn everything upside down and inside out.

I believe the goal of everyone must be as simple as this:

  • Preserve the DIGNITY of the client throughout the process
  • Preserve and protect the MONEY so the Client can live out life as long as possible without financial concern
  • Include the FAMILY of the client in every step of the process

This is NOT easy work, but it is IMPORTANT and NECESSARY work.

The Vital Few Real Estate Professionals are poised and ready to help ANYONE contemplating a move . . .

Just connect with us, and we’ll schedule an introductory “Listening Consultation” so we can learn how we can serve you best.

 

Published by Barry Owen

Strategist-CEO of Pareto Realty Real estate sales Professional Inviter-Facilitator-Practicer of Open Space Technology Opening safe space for people & organizations to self-organize around issues & opportunities BarryOwen.US Invite-Listen-Love

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