Article aired May 12, 2005

Company gives people putting their home on the market an edge

written by: Mark Koebrich, 9NEWS Consumer Reporter

Colorado leads the nation in foreclosures, a problem that could create a tough market for home sellers as we head into the summer selling season.

One company has come up with a solution for those competing in a crowded market. The key is to make your property stand out as a real find against the other properties for sale in your neighborhood. Can't afford it you say? You can if someone else is paying for the upgrades upfront. That "someone" is a company called Value-Builders. They'll do the remodeling at no cost, and then take a share of the new sales price of your home.

For example, they've taken a duplex in the Baker District that was virtually a lost property, a complete write-off, and is now a $400,000 jewel.

Another Baker District resident, Tony Lewis, is hoping they can do the same for his home. Tony says the home sales picure is slow all across the city. To separate his property from the rest of the pack, he hired Value-Builders to do a complete remodel.

"They can make this house stand-out, not only from the outside, but when you walk in, it can deliver that "Wow" factor," says Lewis.

Another example of delivering the "Wow" factor is a home Value-Builders tackled just off Parker Road that was just another beige box.

The home had a dark, outdated kitchen. The bathrooms had no color and the family room was dominated by an old brick fireplace.

Today, the kitchen looks like something out of magazine. Those old bathrooms sparkle, and you'd never recognize the old fireplace.

Value-Builder's Chris Hotz says that's the stuff that matters.

"There's data that suggests the average homebuyer makes a decision within 30-60 seconds of walking into the house so it's all visual," says Hotz.

That's why the company makes sure that interior walls are re-painted in soft and inviting colors, and why every piece of furniture (which they provide for staging) is a conversation piece. Incredibly, much of it comes from garage sales.

"Well fix it up a little bit; we'll paint it, we'll re-finish it, and it looks great in these houses," says Value-Builders partner Brad Licht.
Bank Executives like Shauna Naous, who turns foreclosures over to Hotz and Licth, says the two are batting 1000. Desperate properties sell in days.

"They're fantastic," says Naous. "The property was finished in a show-case condition and we sold that home I believe within 10 days and realized a good recovery on it."

Tony Lewis is hoping for the same results.

The base price of his house is $300,000. Value-Builders will do $15,000 in improvements, at their expense, and boost the "new" sale price to $369,000. After the sale, Value-Builders recovers their remodeling costs, and then splits the remaining profit of $54,000 with the homeowner.

The down-side? "The only downside that I can figure," says Tony, "is if you think you can sell it and get on the market right away, with Value Builders I've got to wait 4-6 weeks until they do the work."

It's a risk that thousands of sellers in a slow market will probably be willing to take.