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3 Ways Presale Renovations Firms Are Not the Same

August 23 2022

toolboxlPresale renovations are one of the hottest tools agents can add to a listing presentation. Sellers are often blown away by the massive property gains possible by avoiding the urge to rush and list, and instead wait and renovate. They are shocked to learn that when they sell "as is," they could lose out on 15 percent to 20 percent -- or more -- of the home's potential value.

For agents, introducing sellers to the newest sales tool distinguishes them from the competition. By showcasing how a move-in-ready home generates the highest possible sales price, agents are winning over more sellers.

Explaining how a presale renovation works can be a huge differentiator for agents, especially among sellers who have likely seen several nearly identical listing presentations.

While the basics of a presale renovation program are often the same — free evaluation, no upfront costs, pay when you close, net a high sales price, and your home sells faster — the companies offering these services are not.

Here are three major criteria to consider when helping your sellers choose a presale renovation firm.

1. ESP: experience, service, and process

First and foremost, look for a firm with a proven track record based on actual experience. The personality and culture of a company are most often a reflection of its leaders — and especially its founders.

A firm led by someone with proven real estate DNA has a significant market advantage that can benefit agents and their sellers, especially in a shifting market. The real estate business is complicated — especially when it is undergoing a transition. But when leadership has successfully navigated through tough waters, that's experience and deep knowledge you can't get from a book.

Do they share their real estate experience by showing you the details — including the math — behind completed renovation projects, or do they offer just video testimonials instead? When the firm is transparent on its website, you will likely find them to be equally transparent when doing business with them.

Not all presale renovation firms have the same service orientation. For example, some presale renovation firms treat real estate agents as their "customers." By contrast, others focus on the seller — yet still ensure the listing agent remains at the center of the transaction.

Finally, the process among presale renovation firms varies greatly. Some renovation firms are the general contractor, and all your eggs are in their basket. Others use a network of contractors, structural engineers on call, in-house designers, and other resources that strive to deliver the highest-quality product to the local markets they serve.

2. Contractor-centric

As mentioned, while some firms are the general contractor and handle all renovations in-house, another approach is to work with a network of vetted contractors. The second approach helps maintain a high-quality work product and faster turnaround times.

For example, Revive Real Estate provides its contractor network with a complete back-office technology solution that frees contractors to focus on the work. Revive handles the process.

It's a model borrowed from successful home flippers. Because Revive handles the details that are needed to run a renovation business, Revive contractors have more time to complete the projects on their list.

3. Seller certainty

Real estate technology often touts the need for speed, assuming most sellers want to close fast. But that's not typically the case. Most sellers don't want speed, which shouldn't be surprising; how hard would it be for you to move if you just found out you are closing in 10 days?

What most sellers really want is certainty: knowing they will close on time, with no unpleasant surprises. So sellers (and agents) want to work with a presale renovation firm that can deliver what they promise on time.

Sellers also want to maximize the sales price of their homes. They are typically willing to take a little more time to get their home in spectacular shape if they can make more money — often a lot more — with a presale renovation.

In today's marketplace of picky buyers, sellers must bring a move-in-ready home to market if they don't want their home to linger on the market (and possibly face a price reduction). A presale renovation increases the certainty of sale and maximizes the sales price.

You can see dozens of before-and-after photos of real homes that have used Revive's presale renovation services, complete with project costs and the net increase in profits to sellers, here.

When agents explain to sellers that the biggest market of home buyers today are millennial buyers, who don't have the time — or the desire — to fix up a home, smart sellers will jump at the chance to do a presale renovation.

Dalip Jaggi is at once an active entrepreneur, a highly skilled technologist, and a profoundly passionate business leader. Today, Dalip is co-founder of Revive Real Estate, a PropTech with a goal to democratize house flipping.