Real Estate Rich, Cash Poor Struggle to Stage Homes for Sale
Do you have friends that love to go out with you, but never invite you to their home? How about neighbors who are super-nice in the yard, but never let you in the house? Don't worry. It isn't you, it's them.
They are hiding a secret that has been kept for years by many homeowners, but the economic decline is causing the veneer of this life of illusion to crack. These friends and neighbors are victims of the American Dream: having the big house to prove you've "made it," but having no money left over to decorate it.
So how did so many people end up real estate rich and decor poor?
The availability of easy money and creative financing can be blamed for being "house poor." People didn't worry about how they would furnish it, the economy was growing strong and they were confident their raises and bonuses would more than cover the cost of decorating. At the very least, they counted on rising real estate prices to enable them to take out a second mortgage for improvements.
Now that the real estate bubble has burst, the secret is out. These homeowners are underwater, and having to sell or be foreclosed on. These "illusion homes" are an added challenge to an already challenging real estate market. Realtors implore the homeowner to stage the home, but they don't even have money left for that.
The home ends up lingering on the market and either being sold at a deep discount as a short sale, or as a foreclosure. You see, today's buyers search the Internet for homes long before they ever step inside one. According to the National Realtors Association, each home receives a mere three-second glance before clicking to the next listing. You have to have great photos in order to grab the buyer's attention and get them interested enough to walk through your door. Since unfurnished rooms don't photograph well, they fail to get attention from anyone but the bargain hunters.
As the old saying goes, you can't judge a book by its cover. Your friends and neighbors may look like they have a fabulous life by the view from the street, but no one knows what lurks behind those doors.
Barbara Green is The Design Diva and owner of Sensibly Chic Interior Design. Follow her on Twitter @thedesigndiva.
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