Real Estate Reality TV: How real is it?

Reality-TV-Shows-vs-Reality-in-the-Real-Estate-World Today we are going to talk about something quite a bit lighter than the Federal Reserve and interest rates and well, you get the idea.

Reality TV is all around us. I admit, I am guilty of watching some of it. My favorites are (as you could probably guess) real estate shows. It’s amazing how easy they make it seem to buy, sell and renovate houses. Of course there are often the requisite problems that arise (that makes interesting TV of course), but they almost always magically work out, and so quickly too!

Well let’s get the skinny on what really happens. The infographic you see above is from Jensen and Company REALTORS®, and I found it via Keeping Current Matters. I will provide a link to the image at the end since it’s probably too small to see on your screen, but I’ll summarize what is says below.

Let’s compare myths to the facts:

* On real estate shows, usually the buyers only view three homes before making their decision. The reality is that buyers often see WAY more homes than three.

* On TV, the homes buyers view are actively for sale. Reality? The homes they view are often sold and off the market.

* When we watch these shows, we are under the assumption that the buyers have not yet decided on which homes they want to purchase. Reality: The home-buying process takes a long time, and the people chosen for the shows have already decided on the home they want and are well into the buying process.

* Real estate agents make a ton of money off of these houses! Reality? The commission paid on the sale of a home is split between the listing agent and buying agent. Then each agent’s commission is split again (the amount depends on the firm). So it may look like they are getting a lot of money, when in reality, they are splitting it a couple of times. Also, people tend to forget that real estate agents pay for marketing.

* Flip or Flop? Ah the renovation shows. Gotta love those. Flip a house and make a killing doing it, right? Well, let’s look at reality. A lot of people are under the impression that the only costs involved in a flip are the renovations and cost of the home. They don’t realize that the investors (how about flippers?) have to pay commissions, closing costs, insurance, interest, utilities and taxes. Those expenses certainly add up.

* The only way to properly prepare a house for market is to hire a professional stager–as seen on many a TV show. True or false? Well, the answer is false. (And I say that despite my upcoming class in December to become a certified stager.) Staging certainly has its place. What is ideal is if your agent understands how to make the home more fit for market. He or she doesn’t necessarily need to be a stager (though the education does help). A simple thing (or maybe not so simple in some cases) homeowners can do is to de-clutter. Everything. I remember when we were selling a home we owned and my agent told me that I could only have three things on my kitchen counter. T.H.R.E.E. Can you even imagine?!? (Well, the house did sell pretty quickly, I must say.) So, de-clutter, take personal photos off the walls (so potential buyers can envision themselves in the home), paint if you can and move big items to the basement or a storage unit. The TV shows very often show stagers coming in with furniture, artwork, vases, lamps, rugs, you name it. This costs lots of money, and with some common sense and a little guidance, you can do it yourself.

To see this infographic up close, click here.

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