Jeremy Ochsner: Welcome to the call. This Jeremy Ochsner with Stillwater Payments. I’m the founder of Stillwater Payments, and today I have the pleasure of speaking with Aaron Clark. He’s a realtor with Edge Realty, and he’s been in real estate for 18 years. We’re going to be discussing what you need to do when you’re buying a house or selling a house and just some great information for business owners as well as folks that are looking to buy or sell. Aaron, welcome to the call.
For More Information about Aaron Clark: ReRenoNV.com
Aaron Clark: Thanks for having me.
Jeremy Ochsner: Absolutely. My pleasure. Do you have any opening comments before we get started?
Aaron Clark: No. Have a good interview.
Jeremy Ochsner: Alright. Hey, Aaron. Since you’ve been in real estate for 18 years, we might call you an expert.
Aaron Clark: It’s important when you want to buy or sell a house to one, figure out what your end goal is going to be. Specifically, what type of home you’re looking to buy, what your goal is as far as your payment, what your affordability is, what area you want to be in. If you have kids that are going to be enrolled in school, you want to think about what schools you might want them to be in. The primary thing for families that weighs heavily on their decision is school districts, so that’s important. You want to think beyond just maybe daycare, but also elementary, junior high, and high school because you could be there for a really long time. You might look at purchasing as something you want to just get into as a stepping stone for five years until you move up to the next thing. Those are all really important things to think about before you reach out to anyone.
At that point, once you have those narrowed down, and they’re going to change, to contact a realtor. A realtor’s going to be able to help you pinpoint those things more precisely and specifically. They’re also going to put you in touch with what type of lending solution you need, whether you’re paying cash or you have a certain amount of money towards a down payment, what type of loan’s going to benefit you the best, which lender to talk to based upon your goals. Once they put you in touch with a lender and you get that information dialed in, then your approach of more of a shotgun approach is going to change to more of a sniper approach. You’re going to be very specific into where your location is and all that.
Sometimes what people will do is they’ll assume a specific area or region and find out that they can go higher than expected and get something a little bit better than what they thought they could get, and sometimes it goes the other way. Sometimes they think can afford something that they really can’t afford. Getting all that information will really help in the process. The whole aspect of it is pretty overwhelming. I like to tell people that it’s sort of like eating an elephant. It’s really overwhelming when you look at it in the whole situation, but the way you start is one bite at a time.
Jeremy Ochsner: Perfect.
Aaron Clark: That’s how the process goes.
Jeremy Ochsner: Okay. This is sort of a follow up question. Where do I start if I was going to buy or sell?
Aaron Clark: Where you start is once you do kind of have that precise information down that we talked about earlier, then, like I said, I kind of already answered that too, that’s where you would start would be to contact a realtor and sit down. A realtor isn’t just to find you a house and work the transaction. Their job is basically they’re an ambassador through the whole process. There’s so many moving parts in the process, from the beginning stages of finding a good lender to finding a house, having to figure out whether or not it’s going to need work, how much that work is going to cost, contractors and repair people for that work, how is that work going to affect the price we’re going to offer, negotiating, insurance, home warranty, taxes, the escrow and title company that’s involved, the underwriters, processors, all of that stuff. There’s a lot of moving parts within a transaction. You probably have an average of about 10 to 12 people that touch the transaction, and it’s all organized by timeframe and things like that. The realtor’s job is really to be an ambassador to make sure that that train keeps moving and reaches its destination.
Jeremy Ochsner: Okay. That’s great information. There is a lot there. Let’s dive into a specific question then. If I was selling my home, Aaron, what changes could I do to my home to increase the value of it?
Aaron Clark: That’s a great question. I get asked that a lot. One of the things that we have to consider is what our budget is. Every home, when we’re getting ready to sell it, or you just bought a home and you want to start dumping money into it to help increase that asset because it’s a huge asset for you over the life of you owning it and figuring out what budget you want to put towards it … You can have a budget that’s a few thousand dollars and you can do quite a few upgrades to your home to increase value.
You can have a budget of say $50,000 or $100,000 where you can do big remodels and things like that, but statistically, the number one thing you can do to a home to increase its value is to upgrade the kitchen. It’s the most desired area of a home to upgrade for potential buyers, as well as just appeal of the home. When you have people come over and people walk in and see your house, the first thing that they notice is the kitchen. In our modern times nowadays, we do a lot of things where, when we have company over, we hang out in the kitchen. The kitchen’s a huge one.
Some really inexpensive things you can do is you can upgrade the front door. That’s another one that’s not too expensive, but it adds a huge appeal to a house because it’s the first thing that anyone sees. You can upgrade the back door. A lot of people, you get into a house and you have a slider or something like that. You could put french doors in there, lead out to a patio. They even have doors now that you can completely remove when you’re entertaining.
Another inexpensive thing you can do if you don’t want to do a full kitchen remodel is, of course, paint and hardware on cabinets. Hardware on cabinets is huge. Can’t tell you how many people I walk into who want to sell their home and their cabinets don’t have hardware, so you get the grease from your hands on the cabinets and you don’t have the hardware for opening and closing the cabinets and the drawers. Just adding a couple hundred dollars in hardware to cabinets instantly improves the appeal of the kitchen.
Appliances, update appliances. A little more on the higher range, but putting a new refrigerator, oven, dishwasher, microwave, fan, all those things, those add tremendous value. Fixtures in each room. A lot of homes, especially older homes, they don’t have light switches into the rooms. They just have outlets or what we call half hot, so it’s a switch for an outlet, so it’s a lamp. Putting in an overhead lighting system or putting in ceiling fans in all the rooms, pretty inexpensive to do, especially if you’re doing, let’s say, one room a month or something like that. That adds tremendous value.
Landscape is huge. We’re in the timeframe now where everybody is really being water conscious, so doing more xeriscaping, desert landscape, things like that, that’s highly attractive for potential buyers. Upgrading your garage door so that it doesn’t look like the track home garage doors. That’s a large increase in value when you do that.
Probably the second most important thing behind a kitchen would be bathrooms. Specifically, the master bathroom. Master bedroom/master bathroom are typically the oasis of the homeowner, so you want those to be as comfortable and entertaining and inviting as possible.
Jeremy Ochsner: Wow. That is great information. Learning a bunch of stuff. Never thought about garage doors being something to upgrade. That’s great information, Aaron. Thank you.
Aaron Clark: It kind of goes back a little bit to the beginning of our first question about financing options. When you’re a business owner, one of the things that you have to get in early to figure out is qualifications. You’re a business owner, I’m a business owner, and typically, business owners, their 1099, depending on how they’re set up with their taxes and how much money they make and all that kind of stuff, will affect their loan availability to themselves. Meeting with a lender right away is going to be really important.
One, if you are a 1099 employee, then you need a minimum of two years of 1099 income for them to approve you. There are some programs out there that allow you to do one year, but there’s some nitty gritty details on that. Overall, it’s going to be two years. For any type of small business owner that’s going to purchase, if you’re two years, three years, four years out, now is the time to start working on that so that you can go in with full knowledge to know what you need to work on, how you might want to modify the way you’re paid to help you be more successful in the process, things like that. That’s typically why you would get in early and get that information so that you can customize everything that you need for that lender to get those approvals for a loan.
Jeremy Ochsner: That’s good. We contact the realtor once we’ve figured out our goals, schools, and that sort of thing. The realtor helps us focus down on what we need to do, contact the lender, now we kind of have a ballpark of what’s going on and there’s definitely some special cases for small business owners depending on how they’re paying themselves. Aaron, you’ve been a professional in this industry for a long time. Can you give me a little bit … How do you put yourself in their shoes since you’ve been doing this for so long?
Aaron Clark: This kind of goes back to … There’s a joke in the industry that a realtor, whenever they’re buying a home, they become a first time home buyer again. It’s easy when you’re on the other side and your life isn’t depending on things. It’s hard for a realtor who’s doing transactions day in and day out to remember those feelings of when they first bought, or not even a first time buyer, but just buying a property, how nerve wracking it is and how stressful it can be on your marriage, family, on your home life, personal, whatever.
One of the things for me, going back a little bit to my background being in the industry since ’99, is I started in the industry in the escrow and title side. I used to train realtors, write continuing education classes for the state, things like that. One of the things that separate me from the pack is having the knowledge of the escrow and title side, which can be the most frustrating part sometimes of the transaction.
Remembering that side and then remembering what it’s like to buy a home myself makes it easy to put myself in my clients’ shoes and walk them through the process, from a moment by moment basis. I try to sit down with the client before we even look at any property for the first time and explain the entire process, what can happen, what most likely will happen, points that are going to be frustrating, points that can derail things, so that they go in completely full of knowledge of the potential things that can disrupt the sale, as well as the excitement of what it’s going to be like to go through the process, because it’s both exciting and stressful at the same time. When those things happen that I have no control over, usually we have a good understanding in the moment so that it’s not a surprise and we can do everything we can to mitigate or save something in those situations.
The other part of it is because we are aware of that whole process, if we start to see anything get a little bit squirrely, then we have time to prepare ourselves for it, modify things if we need to, basically do whatever we can to prevent that.
Jeremy Ochsner: Wow. That’s great. You’re putting your experience to work, helping people out and helping them even through the tough spots. That’s a great plan, Aaron. Hey, I thank you so much for your time and your great answers today. Aaron’s on the radio a couple days a week and provides great information on that show as well. We’re just grateful that you took the time to help share some tips about real estate and what to do, where to start when you buy and sell, and some great information on how to do some upgrades if you’re thinking about selling, as well as maybe contacting a lender to find out what you might be able to buy, and, I guess, focus. That’s another thing you kind of hit on quite a bit was focusing on the things that are important when you’re purchasing or selling your home. Thank you so much, Aaron.
Aaron Clark: Yeah, no problem. Thank you.
For More Information about real estate and Aaron Clark, please visit, ReRenoNV.com
For More Information about Jeremy Ochsner and Stillwater Payments, please visit, StillwaterPayments.com