Garage Sale Tips for Sellers by Tracy Suttles: Ways to Maximize Profit from Rummage Sales

The following post is a guest post from Houston, Texas area real estate developer and entrepreneur Tracy Suttles. Tracy can be best contacted for questions, comments and concerns on Twitter at @tracydsuttles.

If a person has never put on a garage sale, the task may seem quite intimidating. Some people let their old, unused items pile up simply because they do not think yard sales are worthwhile, or because they think that they are too much work. However, the following tips may help simplify the garage sale mess to make it more manageable, which can help get the cash flowing.

Sorting out Items for a Rummage Sale

Frankly, one of the most difficult tasks when it comes to putting on a garage sale is sorting out the junk to sell from the other junk. One of the most important things to keep in mind is the question “would anyone consider buying this at a yard sale?” If the answer is no, then the item can probably be donated, or thrown out if it is too ragged. If anyone may possibly want the item then it may be worth it to at least try to sell the item. But if space becomes an issue it may be a good idea to try to sort out good sale items from bad ones.

One never knows whether people will be interested in buying in their “junk” or not, but some items are definitely better sellers than others. The following items are examples of items that can be good sellers:

  • antiques and collectibles that were not widely manufactured
  • star wars collectibles, or other collectibles that have a large fan base (like comic books)
  • electronics, like old video game systems
  • musical instruments
  • clothing items
  • kitchen appliances in good condition
  • small items to be sold in bulk, like gems

Just about anything can sell if the price is low enough. However, very cheap or common items are less likely to sell. For instance, Beanie Babies and other fad items seem as if they would sell well, but because so many people have them they will probably not sell as well as other items. Cheap items like plastic rings are also unlikely to sell unless one comes up with a clever marketing idea, like “ten items for ten cents.”

How to Set Up Shop for the Sale

Before starting, it may be a good idea to contact nearby neighbors about the event if one anticipates that any neighbors may have issues with the garage sale. Once any necessary people have been contacted, a set up plan can commence.

It is a good idea to make a simple map of one’s garage beforehand. Make sure that all tables will fit, and that the space is not too small for an effective sale. If it happens to be too small, some larger, less valuable, or sun-resistant items can be placed outside the garage if it is not raining or snowing on the day of the sale. Items to go in the garage may be set up the day before to minimize stress the morning of the sale.

Organizing the sale floor by item type may help buyers navigate the sale. If everything is just thrown together people may miss items that they otherwise would buy. For instance, placing all electronics together may attract a potential buyer who is only interested in buying electronics.

It may also be a smart move to price items, and to place similarly priced items near one another on the tables (or on the ground). While many garage sale hunters love to bargain, others do not. However, it may be wise to price items slightly higher than one expects to sell them for at first, so that bargain hunters do not go below one’s acceptable price.

It is very important to have some cash and change on hand in the event that potential buyers come in with big bills. A cash box and a place to record sales can help one to keep track of any transactions. A calculator is a very important element of any yard sale, as are plastic and paper grocery bags for any buyers who purchase multiple items.

Getting People to Come to Yardsales

Personalized signs can be a great way to let people know that one is having a garage sale. However, as mentioned here, it is important to make sure that this is not against any regulations, and that a permit is not required for a sale. Signs and banners are a very important element, because they can attract people who are in the process of hunting for sales, people who shop on a whim, and people who want to plan their garage sale route ahead of time. Because of this, it is best to place signs up a few days ahead of time to alert potential shoppers.

Signs should not be too descriptive or detailed, as people who are driving by may miss all of the important information if that is the case. The most important elements are the name of the event, date, time, and location. An arrow pointing people in the correct direction may also be helpful.

Another marketing method is to advertise one’s sale on a public site like Craigslist. Sites like these allow users to advertise events free of charge. This can allow one to advertise an event to people who do not live within the immediate vicinity of one’s neighborhood.

With these hints in mind, one may be able to throw together a successful garage sale with minimal headaches.

The Case for a Down Real Estate Market

Many lucky sellers saw their fates rise with the brief uptick in the real estate market. The housing tax credit, optimistic economic data, low mortgage rates and reluctant bank foreclosures set the stage for a fleeting rally in housing process.

More importantly, the real estate market re-opened for business with buyers snapping up homes at a faster rate (albeit at a steep discount to the purchased price). Of the factors listed above, the only enduring attribute of that market rise is the low mortgage rate.

Short-Term Real Estate Market Expectations

The sellers that missed the market or simply priced themselves too high in hopes of eking out a slightly larger profit will soon find themselves without a chair in the fast past game of musical chairs that is the real estate market. Many people are surprised at quickly the market turned sideways.

Unfortunately for many sellers, the expiration of the homebuyer tax credit coincided with renewed economic challenges. The job market remains soft; however, many jobless people face the end of their unemployment benefits. Legislation remains stalled that would either extend those benefits or provide outside financial help for jobless homeowners.

To further add to the perfect negative storm, banks finally got the foreclosure message. Listing of bank owned properties continue to increase and the high foreclosure numbers of the past six months have turned into even higher real estate inventory numbers in the market.

In the short-term, the real estate market faces a major supply and demand problem. On the demand side, consumers lost an $8,000 incentive to purchase a new home and they remain weary of the job outlook. On the supply side, bank foreclosures are flooding the market at extremely competitive prices dragging down an already challenged real estate market.

Real Estate Investor Opportunities

Real estate investors that missed the sale window should de-list their property and hunker down. Now would be a great time to lock a tenant in for one or two years until the market regains traction and the broader economy commits to a real recovery.

On the buy side, it is once again the time to go for big price concessions and target foreclosure opportunities. Given the above, the best strategy today is buy and hold. Flip opportunities will be rare in the next six months to a year and now is a great time to lock in great 30-year fixed interest rates. Buying big at deep discounts should pay huge dividends in the coming years.

Buyers should also avoid the hassle of short sales. There are too many opportunities in the market (read high inventory levels) to waste time, energy and money pursuing a short sale that could take six months or more. Recent foreclosures offer better discounts and can be purchased quickly. Now is the time to buy low

Midwest Real Estate Analysis of Residential Prices in a Recession

The Midwest real estate markets have been doing exceptionally well, as compared to much of the rest of the country. Homes have foreclosed and properties have been sold at auction, but when one looks at the numbers they can’t deny the Midwest residential real estate markets, namely Wisconsin, Iowa, and Illinois, have done well.

Wisconsin’s Residential Real Estate Wins Big

A recent report published by neighborhoodscouts.com, states, the percentage of Wisconsin residents who are currently home owners is an astounding 61.46 percent. Renters in Wisconsin reached, 28.34%, leaving just over 10 percent of the Wisconsin homes vacant. The most common type of real estate in Wisconsin, is the single family detached homes, with 65.99 percent of the real estate falling into that category. Apartment complexes, otherwise known as high rise apartments, are the next best bet for the real estate investor in Wisconsin, consuming 14.03 percent of the total real estate owned in Wisconsin.

Wisconsin’s apartment real estate markets are on fire, the high rise apartment properties are a large chunk of Wisconsin’s real estate industry. That becomes more apparent, with the next revelation of Wisconsin’s real estate numbers. The amount of real estate being consumed by small apartment buildings in the state are nearly the same as the high rise apartments. Mobile homes sales in the state also makes an impact on the real estate markets, and the economy of Wisconsin, small as it may be. The amount of real estate being owned by mobile home owners and sellers rests at a small, 4.37 percent.

The median home value in the state averages out to be just under, $186,000. The price paid by most homeowners. Some paid a bit more, about 43.75 percent, paid between $170,000 and $339,000. The majority of the rest of the real estate sold in the state of Wisconsin, 33.83 percent, rests below the median home value range at the $84,000 to $169,000 range.

The average rental rate for a Wisconsin apartment crunches out to be $696.00, per month. After reflecting on these numbers, any agent can see that the largest and most profitable, despite the losses, is the residential home market. Over 30% of the real estate sales comes from privately owned homes, by far the largest chunk of the pie in Wisconsin.

Iowa Real Estate

The state of Iowa has been one of the best real estate markets in the country. Since 1990, the appreciation rate of Iowa real estate has risen 6.37 percent, and in the last 12 months, it has risen 0.82 percent. Residential real estate prices in Iowa fling from the bottom rung, all the way up to the top shelf.

The cost of residential real estate in central Iowa is much heavier than that of the western and northern regions of the state, though, making a median value hard to determine. In Des Moines, residential homes can range from $129,000 all the way up to $168,400, for the average single family home. In the northern cities, such as Dubuque, the housing costs are fairly low, in the range of $35,000 to $79,000.

Iowa’s median income reaches the 60 thousand dollar range, which is needed by Iowans just to maintain the mortgage on a lower priced $70,000, home.

Illinois real Estate

According to that same report, Illinois has been doing a bit better in this respect, than Iowa, but not nearly as strong as Wisconsin. Illinois appreciation rates have climbed over the past 10 years , 6.4 percent, but across the last 12 months, the residential real estate in Illinois has plummeted 2.92 percent, including a loss of 0.16 last quarter. In 2014, the all important median value of a residential piece of real estate, namely a single family home, lists at just below $184,000, making it the 21st in the United States.

The average monthly mortgage in Illinois is $1,455. The median income of Illinois home owners was $61,174, ranking it 14th, but per capita, the state averages a poultry 26,307, making that $1,500 mortgage payment a little harder to fathom.

Most of the Illinois economy is industrial based, that includes farming, soft coal, mining, oil production and refinement. It manufactures everything from iron and steel, and chemicals . If the industry markets of Illinois are crushed by state and national legislations, as many politicians wish to do, the Illinois’ real estate industry will crumble as the legislations grow.

The Overview

After researching and reading all the real estate facts for Iowa, Illinois, and Wisconsin, the only conclusion that can be reached is, the most commonly bought and sold pieces of real estate in the entire Midwest, is residential homes and apartments, specifically large or high rise apartments.

Selling Real Estate and Emotions: Property Transactions and Feelings Don’t Always Mix

Unlike stocks and bonds, real estate tends to be a very emotional asset class. Because owners invest their time, energy and money into making their real estate investment shine, they feel an added connection to their building or home. While a stockholder can easily blame the CEO for the stock price decline, real estate investors can only look to themselves. Rarely do real estate investors accurately assess their value-adds or lack thereof to their investment; instead, they price their investments as they see them through rose colored glasses.

Identify Real Estate Emotions

The biggest value a realtor can bring to a transaction is an outside, unbiased opinion of the property’s value. While it is up to the seller to decide whether or not to trust that opinion, realtors don’t have the same emotional tie to the property.

Emotions cloud a multitude of transactions. In real estate short sales, the seller is obviously disappointed that the value they must sell their home for is less than they paid and even in fact less than their current mortgage. Furthermore, every lowball offer further reinforces their poor investment decision. These sellers will be much tougher to negotiate with because they feel a sense of personal failure.

Conversely, an older couple or family selling the home they built for their family will feel a huge amount of sentimental value for their home. Each memory and investment adds a bit of character to their home that another purchaser could never quantify. Again, a lowball offer personally offends these sellers because they feel as if their memories are being cheapened in the process. First time rehabbers and long time landlords often have these same emotions.

Negotiating with Emotional Real Estate Sellers

When buying real estate, investors need to understand the other sides’ perspective. Getting to know the seller and their motivations for selling can help a buyer tailor their investment pitch. While it still may be necessary to place a lowball offer on a property, potential buyers should do their best to accompany these offers with factual analysis. It might be helpful to submit comparable properties prices or a list of items that the buyer intends to replace or repair. The goal is to submit an offer that will appear fair to an emotional seller.

From an investor’s perspective, buying and selling real estate should be a transaction devoid of emotion; however, real estate transactions always involve two people and are rarely without emotion. Providing a fact-based bid and showing a seller that a the buyer intends to better the property can go a long way in making a transaction happen.

Real Estate is Too Easy…NOT!

It is so easy to sell your own home–right? That certainly is the opinion of the general public. There is skill and expertise required to effectively market your home–that is where a real estate has professional training to help do the job. You see, thie key is to define your target audience, homebuyers, that is, and gear all of your efforts towards them. In other words you would not advertise in an “Auto Trader” magazine or RV Trading periodicals. The people that are reading those publications are not in the market for a home at this time. You are best suited advertising in a local real estate magazine such as “The Real Estate Book” or “Real Estate Source”. There are many publications out there–find out which is the dominate one in your area and go with it. You also might want to advertise in the real estate section of your local newspaper and/or the Internet. But that scoop is not where the skill and expertise end.What you say in your advertisement is equally as important as where you advertise. You advertisement needs to peak the curiousity of the prospective buyer enough to make them call you. Your advertisement does not need to be so detailed that a buyer prospect can make up their mind without even inquiring with a telephone call. The ad needs to call the buyers attention to your property and entice them to call you–you then become the salesperson! Also avoid putting your address in the advertisement–a buyer might drive-by at a time when the curb appeal is not at its optimum and never call!!! There are just so many things to know about the law in advertising–that’s set for another article.