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Vol.3, Iss.13, Cover Story: Opting to Upgrade

by Chicago Agent

By K.K. Snyder

When it comes to new construction purchases, getting your client to sign on the dotted line might be the easy part. Because your clients can customize their new construction homes from nearly endless lists of interior finishes, the process is often just beginning when they decide to buy. To make this process easier for your buyer (and you), align yourself with the best options and upgrades experts in the field. Doing so will not only make you more valuable to your clients, it will increase your bottom line and boost your reputation for quality service.

Available options and upgrades can be overwhelming for your client: cabinets and countertops for kitchen and bath, appliances, hardwood flooring, electrical and low voltage, HVAC, security, hardwood, tile, natural stone and carpeting. Fortunately, there are professionals out there ready to lead your clients through the selection process.

“For example, if red oak is standard in the living and dining rooms and kitchen for a home, some upgraded items might be maple, cherry and walnut wood species,” says Janet Gross, an options and upgrades specialist for Explore Your Options.  “Another upgrade in the wood category might be to have an optional stain applied to the wood, or optional finish of the wood (semi-gloss or matte), or to install the wood on the diagonal.

“You can see the complexity of this line of work in this one example,” she says. “That is why it is really important to have a professional performing the task of options and upgrades. There are so many details to cover, and construction is relying on your information in order to build the home correctly.”

On average, buyers spend 5 percent to 7 percent of base the purchase price on options and upgrades, says Gross. For example, if the buyer is acquiring a condo for $400,000, he will spend around $20,000 for upgrades.

“This number can fluctuate depending on the level of standard features in the home and if the home is going to be for personal use or investment,” says Gross. “Also, it is a great idea to inform the buyers of this upfront when they are talking with mortgage lenders so they can build the upgrade amount into their mortgage.”

The best thing an agent can do for his clients is recommend to them an options and upgrades expert with confidence. “The broker needs to trust the developer and the development team and communicate that positively to the buyer,” says Gross, who also advises agents to encourage their clients to meet with the selections coordinator alone.

If the buyers prefer to have the broker accompany him, a good compromise is to have the buyer meet with the broker at the design center without the coordinator, says Gross. “This way the buyer and broker can freely talk and then get back to the [selections coordinator] with any changes,” she says.

DECISIONS, DECISIONS

The list of “must-haves” starts with kitchen options, because it’s the area of the home that often gets the most attention, says Crystal White, design studio manager for Kensington Homes, a Chicagoland builder with homes in eight communities.

Clients want kitchen cabinets in rich cherry or maple, commercial appliances, including multiple dishwashers and ovens and custom tile backsplashes, especially mosaic. Gone are the days when full-height granite backsplashes matching the stone on the kitchen counter, white kitchen cabinets and big whirlpool tubs were popular.

“People are opting for larger showers in the master baths with steam units instead,” says Gross. And some don’t want a tub in their master bath at all, adds White. But she recommends that homeowners include at least one bathtub in the home for resale value.
Hardware finishes in satin nickel and wrought iron are popular, and bright brass faucets are out. Color choices are the most subjective, so buyers should choose carefully. Varying colors, even in the same room, is currently a popular way to use color. All shades of red, “vapors” such as seafoam greens and blues and chocolate brown are hot colors.

Topping the audio/entertainment lists are items that appeal to tech-savvy buyers, such as the iPod docking station and the Sony Wall Station, a DVD player built into the wall adjacent to a plasma television. Media rooms, surround-sound and house-wide speaker systems remain popular.

Many design centers package options and upgrades, which not only makes selection easier for some buyers, but also brings down the cost. “Clients know, for example, that they can get this faucet with this toilet and this pedestal sink,” says White, noting that Kensington is flexible and will accommodate clients if they want to deviate from set bundles to create a more custom package.

Buyers are invited to open houses and provided with a visit with the design coordinator. “At the open house, the focus is on cabinets and flooring,” says White. She adds that some clients come in with a strong sense of what they want, but others require much more input from the experts.

YOUR ROLE

The agent isn’t entirely out of the picture when it comes to options and upgrades. Agents can help buyers determine their needs in order to maintain the lifestyle they lead. For example, having kids can influence color choices and other things buyers might want select to have in their houses.

Those who work with companies like those of Gross and White are indebted to them. “Having somebody like Janet to streamline the selection of upgrades and options took a major burden off our shoulders and let us do what we do best—and that’s being the developer and general contractor,” says Michael Obloy, a partner in Peak Construction, a development of Cullom-Ashland LLC and an affiliate of Peak Construction/Development LLC.

Obloy was pleased when Gross lent her expertise for a 31-unit project, even though she is accustomed to projects of 200 to 300 units. “It allows us to provide the best possible service for our customers,” he says. “We want to provide the best possible experience they can have with the best real estate agents and the best upgrades-and-options consultants.”
Some agents prefer to stay with their clients during the selection process in order to keep the process from becoming to overwhelming, says Mike Sato, a Realtor with Koenig & Strey GMAC.

“We’re not interior decorators, but we’ve seen so many places that we know what’s popularly accepted and things that aren’t accepted,” says Sato, who has 25 years experience in the industry. “We also advise them on what’s better for resale.”

Sato says some of the preparation he does with clients gets them thinking about things they plan to move into the home (such as furniture, artwork and window treatments) that can affect choices they make for options and upgrades. He reminds them to keep color schemes and finishes in mind when selecting the items for the new home.

It’s also smart to keep the client’s budget in mind so you can help him get the biggest bang for his buck, adds Sato. He advises buyers to concentrate on the kitchen and bathrooms for spending their options and upgrades dollars.

F.C. Pilgrim and Co. Realtor April Moon has worked on 27 developments, but her work on a recent project with Centrum Properties was her first experience with a developer who had his own designer. “It was wonderful,” says Moon. She is usually hands-on with clients during the options and upgrades selection process.

“Everyone wants to customize their unit and unfortunately not everyone gets out there like we do to see what’s new, what’s trendy, what works,” says Moon, who recently spent eight hours with a couple making their selections. “The other week someone picked out an oak cabinet—that bad oak from the ’80s that no one has used in 25 years. So, I explained to her that it’s not just about what you like but also what will be good for resale.” C.A.

Janet Gross
Options and Upgrades Specialist
Explore Your Options
312.296.0886
[email protected]

April Moon
Realtor
F.C. Pilgrim & Co.
708.383.8300
[email protected]
Michael Obloy
Partner
Peak Construction
312.229.4644
[email protected]
Mike Sato
Realtor
Koenig & Strey GMAC
312.475.4200
[email protected]

Crystal White
Design Studio Manager
Kensington Homes
630.579.9667
[email protected]

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