What's 'beautiful' worth? About $12,500
The right phrasing in real-estate listings can speed a sale and even boost the final price, a Canadian study says. And here's a tip: If you must sell, don't put "must sell" in your ad.
In real-estate listings, what's the difference between describing your home as "beautiful" versus "move-in condition"? About $12,500 on a $250,000 home.
Professor Paul Anglin, a real-estate economist in Guelph, Ontario, says that homes described as "beautiful" in real-estate listings sell for 5% more while "move-in condition" has no effect on sale price.
Anglin and his colleagues from the University of Windsor and researchers from Canada Mortgage and Housing examined about 20,000 real-estate listings and sales data in Windsor and Essex counties, Ontario, from between 1997 and early 2000. Among other things, they studied how listings' phrasing affected sale prices and the length of time it took for the listings to close.
When speed is of the essence
Listings with the words "beautiful" or "gorgeous" sold 15% faster. "Landscaping" in a listing hastened a sale by 20%. Describing a property as in "move-in condition" quickened the sale by 12%. Calling a home a "handyman special" cut sale time by half (researchers excluded listings that used the term to describe a workshop or hobby area).
Other familiar jargon, such as "must see" or "vacant," or including the information that a seller was moving, had virtually no effect on the time before a sale.
The kiss of death appears to be language that reeks of desperation -- words such as "motivated" and "must sell." These slowed sales by 30%. The term "ranch" house slowed sales by 10%. Properties described as rentals (income-producing) took 60% longer to sell.
Though Anglin assumes the basic effects he identified are universal, the size of their impact will vary by locale, he says.
Do you believe in magic words?
Is there magic in these words? Does the concrete, visual nature of "landscaping," for example, fire a buyer's imagination?
Stella Frize, a real-estate agent in Cerritos, Calif., believes so. But for her, the magic word is "turnkey."
"Any time I see the word 'turnkey,' I expect that house is in immaculate condition," she says.
Frize's business partner has his own favorite turn of phrase: "He always writes, 'This could be the best buy in town.' He believes in this wholeheartedly. We put it on every listing. It's like good karma for us. We have sold 100% of our listings."
What surprises Anglin is that some hot words not only speed a sale but also seem to raise the closing price. "If a house is described as 'beautiful,' everybody expects it to sell for a higher price," he says. "The thing that surprised me is that it sells for a higher price -- and faster. ... I don't have a good explanation for it."
Maybe, he says, buyers' idea of beauty includes features such as structural integrity, a good neighborhood and excellent upkeep, qualities agents call "curb appeal," which allay the fears buyers usually bring to big transactions.
The right words pay off in speed and money*
|Term||Effect on time until sale||Effect on list price||Effect on selling price|
Source: "House Prices and Time-till-sale in Windsor," Professor Paul Anglin, University of Guelph, Ontario
*The study examined roughly 20,000 listings in Windsor and Essex counties, Ontario, from between 1997 and early 2000. The effects shown are averages; wide variations appeared within categories.
Language + price = sale
None of this is to suggest that opting for "must see" over "must sell" is all it takes to sell your house quickly and garner a higher list price. The hot words have to be used accurately, and they must be combined with the right price.
"The single most important message that a seller can send to a buyer is their choice of list price," Anglin's study says.
Thus, the study does not illustrate a triumph of style over substance, Anglin says, but how certain words, used accurately, can boost a listing's power. Although "beautiful" seems to make a house sell faster, using the term dishonestly can offend buyers and create distrust that will backfire on a seller.
"The basic idea is that you are trying to find the one buyer who is going to buy the house. As a seller, you hope they'll pay a high price and quickly find your house. But usually it does not work that way," Anglin says. "It takes some time to find a buyer, and usually the buyer does not want to pay a high price. The purpose of the listing information is to attract not just any buyer but the buyers who would like the house that you are trying to sell."
That's why, although "handyman special" may sound negative -- "most people do not want to go anywhere near that place," Anglin notes -- it's an efficient, positively framed means of isolating such properties for the specific buyers interested in tackling fixer-uppers.
Home size, too, is another important factor. The smaller the property, the quicker the sale. One-bathroom homes sold 13% faster. Homes with three bathrooms took 50% longer to sell. Homes with two stories or more took more than 20% longer.
The size-speed relationship makes sense to real-estate agent Joe Dobson of Coldwell Banker Schneidmiller Realty in Coeur d'Alene, Idaho. Smaller homes usually cost less, and there's more competition in lower price ranges, he says.
For the most part, Dobson says, his experience bears out Anglin's research, with a couple exceptions. "'Motivated,' that's been beat to death. In a slowing market, every seller is 'motivated,'" Dobson says.
But sometimes, he says, desperate language can work when accompanied by an emotion-laden explanation such as "must sell due to health reasons" or -- a phrase Dobson likes but has found occasion to use only three times in his 36-year career -- "divorce dictates dumping."