Episode #50 - Freemodel's Renovation Rescue: The No-Money-Down Solution to Selling Your Home

Let Freemodel remove the barriers to pre-sale renovations.

Lara Richmond from Freemodel reveals how pre-sale renovations with no upfront costs can transform properties and maximize sale prices, sharing real examples of homes that gained hundreds of thousands in added value through strategic improvements.

Watch our companion video segment here

• Freemodel funds and manages pre-sale renovations with payment deferred until closing
• Ideal for homeowners with equity but no available cash for improvements
• Project managers handle everything from design selections to contractor coordination
• Beyond selling, Fremodel offers "invoice projects" for buyers renovating new homes
• Project managers build reliable contractor networks for smooth project execution
• Understanding target buyer demographics drives design decisions that appeal to the market
• Forward-thinking renovations consider coming regulations like California's 2029 gas appliance ban

Lara's passion for remodeling ignited with the renovation of her first home, leading her to study design and architecture at George Washington University. Since 2008, she has been revitalizing homes across the San Francisco Bay Area, New York, and Washington, D.C. As the founder and CEO of Agave Interior Design, Lara is dedicated to creating beautiful and functional spaces that enhance the well-being of families. Her projects have set record sale prices in several East Bay neighborhoods, including Oakland, Berkeley, and Richmond Heights. 

Declan Spring is a licensed CA REALTOR® DRE#01398898 

Chapters

• 0:00 Introduction to Fremodel's Pre-Sale Renovations
• 3:46 Laura Richmond's Design Background & Role
• 9:47 How Fremodel Works for Home Sellers
• 26:31 Project Manager Selection & Importance
• 38:37 Real Results: From $1M to $1.8M Case Study
• 47:50 Finding & Managing Quality Contractors
• 54:41 Managing Client Expectations & Design Input
• 1:02:13 Avoiding Cost Overruns & Change Management
• 1:08:16 Beyond Selling: Invoice Projects & Design Options

Transcript

Declan Spring: 0:00

This is Declan Spring, and thanks for joining me on the Mostly Real Estate Podcast. Have you ever wondered how to prepare a property for the market when all your money's tied up in equity? Have you ever wished you could renovate a home before selling it without paying anything up front? Well, today we're talking to Lara Richmond from Fremodel, a company that's kind of changing the way homeowners get their properties market ready. Fremodel funds and manages pre-sale renovations with no upfront costs, helping sellers increase their home's value and sell faster, all while taking the renovation stress off their plate and off the plate of their real estate agent, which means a lot to me. So let's break down the process, how it works, what homeowners should consider and some behind-the-scenes insights into this innovative approach. So, laura, thank you for coming to the Mostly Real Estate podcast. You know how happy I am to have you here.

Lara Richmond: 1:06

Thank you so much for inviting me to be here today. This is really fun and exciting. I appreciate it.

Declan Spring: 1:10

Well, let's see if we can get an education on what Free Model does. How was my intro?

Lara Richmond: 1:14

Your intro was good. I liked it. Yeah, okay, it was chatty and personable and understandable for the lay people.

Declan Spring: 1:21

I think, do you know what I mean? Yeah, yeah, and maybe for realtors too.

Lara Richmond: 1:28

Well, realtors, for sure, but you're going to catch the people that you know pre-sale renovation, like we all know what those things mean. Other people are oh yeah, that's true. What is that actually? What is that? What does that entail?

Declan Spring: 1:35

Oh my gosh, this could be a good conversation then. So I met you a few years ago when I reached out to Free Model for help with an Albany property and you were introduced to me as a project manager. So can you kind of talk to me about your career and how you got involved with Free Model and what your role is there?

Lara Richmond: 1:52

Sure, I have been renovating my personal houses since 25 years probably. My husband and I have owned seven houses in seven different states that we've remodeled of our own by house number three. I had decided this was probably career ready for me and I went to design school at GW and studied interior design and architecture there and then started my business in DC. So I worked as a private interior designer there.

Lara Richmond: 2:17

I worked for a design nonprofit in New York for four years and then I came out to the Bay Area seven years ago and started with Ethan Allen and I ran three design centers for them and when I decided I was done with retail during the pandemic, when everything got really crazy and bananas and nobody had any employees and people couldn't come to the stores I was all done.

Lara Richmond: 2:37

So I was looking for a new opportunity and I found John Garner, who was one of the founders of Free Model. We sort of found each other on LinkedIn and had lunch and it was that was it. We were speaking the same language and we were both interested in doing things the same way, and the joke is always, when I had my first conversation with the two founders was for me, I was like, wait a minute, I get to do all the fun stuff. I get to talk to clients and do design and be on the project on the ground, get dirty, be with my contractors and you're going to do the paperwork, like you're going to do the billing and my invoicing and pay contractors and all of the business parts that most creatives don't love, yes, and they're going to handle that, and for them they're like this is the stuff we can do easily in an office.

Lara Richmond: 3:19

You have the hard job, and so both of us were very happy to meet at this place where we had these things to offer that were so compatible, and so that was how I started.

Declan Spring: 3:27

Yeah, brilliant, I didn't realize it was that recent for you during the pandemic.

Lara Richmond: 3:32

This May will be four years.

Declan Spring: 3:33

Wow, it's amazing. And the project management side. Now, as a realtor using free model services, when I first approached free model, I talked to a few agents who I knew had worked with free model and I asked them you know what's the most important thing, in your opinion, about approaching free model for a project? They said the project manager. Like that's the person you're going to deal with on the daily. That's the person who's going to make all the design selections, is going to coordinate the entire project and is going to also probably decide who the contractors are, who's working on the project. Now I know Free Model will allow people other than those people you select to also work on a project, so we can get into that. But the project management side for me was the most refreshing part, because now you come along and you're going to. I mean I can't. I mean I cried right, because typically we manage a project.

Lara Richmond: 4:33

It's a lot of choosing Every light, every switch plate, every tile, every cabinet style, every faucet. It is it's hundreds of things to it's hundreds of decisions to make. It's overwhelming for most people.

Declan Spring: 4:46

it is massive yeah and having worked with you.

Declan Spring: 4:48

Then everything is line by line, by line by line by line, like down to like this screw costs, this much and that screw costs and these five nails of this size will cost. I mean it's amazing how detailed, uh, all of the work you do is and and how you inventory everything and that kind of thing. So what's the? So explain people through. You know the basic process, what is a good fit for a free model project, and you know that kind of thing. Let's just go real basic.

Lara Richmond: 5:17

Well, just to start, when you say, choosing like having the right project manager, every project manager at free model, we're not actually employees. Think of us more like Uber drivers. So we're all contract employees and so many of us have businesses outside of that, Like I know one who's a stager but also does projects with Fremont, and so people. But you want to find the person that's the right fit for you.

Lara Richmond: 5:37

Some agents are more hands-on. Some really want to hand you a key and walk away. Yeah, so there are multiple people to choose from to find the person that is personally and design-wise the right fit for you. Yes, and so you can ask around. There are enough of us that you can probably find one.

Declan Spring: 5:52

Yeah, because the personality is important. I'm a fairly hands-off kind of realtor. Yes you are, I prefer to watch what you're doing, but I'm not necessarily going to you.

Lara Richmond: 6:03

Don't want to have to step in. That's why you brought us that's why I brought you Exactly. But there are agents that don't feel that way. There are agents that know exactly what they want it to look like.

Declan Spring: 6:10

Right.

Lara Richmond: 6:11

And they want to choose every tile and oversee everything and get massive design boards and make decisions on grout colors and like really gritty. And at that point I'm not sure if they've already basically have the design in their own head. I'm not sure what I've brought to the table that their client is paying for if they've already done it. Do you know?

Declan Spring: 6:28

what I mean.

Lara Richmond: 6:28

They already want to oversee every move, and so some of those are not a great fit for me personally. And I might like the agent and like the project, but maybe that's not the best fit going forward and so those aren't, you know, poor projects. They're yes not always the right balance, and there are people that want to be more hands-off with design and love that yes, yeah, absolutely.

Declan Spring: 6:47

That's what I mean, like. So when I was told back to the whole point of this, like that the project manager that I selected or chose to work with was, like, probably the most important decision, yes, um, that was. It was pretty accurate and unfortunately, I met you and I thought this is the right fit for me.

Lara Richmond: 7:05

This has been great. We've had a great relationship with our project so far.

Declan Spring: 7:08

We have so far. But so, let's say, your phone rings and there's potentially a project brewing. What kind of projects? Just very basically, what is Fremontel assisting with, or what niche do they fit into in this marketplace?

Lara Richmond: 7:28

Okay, so I would say Fremontel is the most useful for people that they have a home. They need to get it ready for the market and it needs some love that the people can't fund themselves.

Declan Spring: 7:39

Right.

Lara Richmond: 7:43

So either it's somebody who has passed away and the heirs don't live here and they can't oversee this process, or they you know there's no money left in. You know the heirs own the house but there's no way to cash that to pay for a renovation. There's lots of that. There are divorces, I'm sorry to say, where money is tight and people are trying to get out of these and they're complicated, and also just people that bought and never had the time or money or know-how and just lived in what they purchased and now it's 30 years later and you can't put that on the market in the Bay Area Like. That's not. It's not just will it not sell for enough? It's, will it sell?

Declan Spring: 8:15

Yes. That's an interesting question Will it even get an offer? Because this is one of the trends right that we're noticing here in the East Bay at least, is that people will pay more than the sum of the cost of the renovation, absolutely For the convenience of the fact that often it's a two-income household. They don't have time for this stuff.

Lara Richmond: 8:37

No, people want to move in, open their boxes and go back to their life. That's right, and so we need to create a place where they can do that, even if it's not perfect. Can we get it far enough that they can even in their minds, even if they never do it say well, we can live with this kitchen or this bathroom for five years and then, once we know what we want, we'll do it. Maybe they will and maybe they won't, but it has to be nice enough that people can walk.

Declan Spring: 9:00

Right, right, it has become really, really important. Like will we even get an offer is like a real question.

Lara Richmond: 9:06

Yes, and some of these renovations are not just get an offer because it's unattractive or outdated, but now we have all these insurance issues. So if you don't do some of the work electrical foundation, roof you can't insure that house, which means, even if people love it and would be willing to take it on, they can't get insurance Right, and so that is a problem. So some of this is gratuitous, like we want to make your kitchen prettier. Some of it is truly functional in terms of the bones of the home.

Declan Spring: 9:32

Marketability of a property, sellability of a property with their insurance. I totally hear you, absolutely A hundred percent. So the house that I first met you on the project I called you in on and this will probably paint a picture for people I think at the time you know it was a lovely like, I think, a three-bedroom, two-bath in Albany, something around there I think. I remember. It was a four-two.

Lara Richmond: 9:57

No, maybe there's only one upstairs, maybe it was a three or four, three or four-two, yeah, two baths.

Declan Spring: 10:07

Nice house and I had looked at the market and I think the conclusion that I had come to was OK, these folks had plenty of equity in their home. They hadn't tapped equity at all. They had paid off almost all their mortgage. So there was a lot of equity in the home, but they didn't have any money. They didn't want to open an equity line of credit. I talked to them about free model. I think we looked at the numbers and decided that if the property went on the market in the condition it was in the day I went to see it, we thought maybe it would sell around $1 million, $900,000 or $1 million. Something like that is my memory of it. Something like that is my memory of it. But if we did a certain amount of work, we could make it far more attractive, far more marketable, and my recollection is that once I brought you in and we figured out what would be the right projects to tackle I think it was about a $200,000.

Lara Richmond: 11:02

Yeah, I think like maybe even $160,000 to $180,000, a little under $200,000. Yeah, I think like maybe even 160 to 180, a little under 200, I think we spent on that I could probably look it up. But yeah, I think it was. Right, yeah, but it was a full kitchen, two full baths. We had wiring decks.

Declan Spring: 11:15

I think I had it as maybe a house that would sell for a million one, maybe a million two on a good day, okay. But if we put in the 180 or whatever day, but if we put in the 180 or whatever, that they probably see closer to 1.6.

Lara Richmond: 11:31

And they looked at those numbers they said great, where do?

Declan Spring: 11:32

we sign and they met you, of course, and all of the projects made sense to them and we went on the market. I think we closed close to 180. Is that right, yeah?

Lara Richmond: 11:41

I don't know if I even ever asked you what it went for. That's so funny because we walk off when you mark it and sometimes you guys reach back out to us and you're like, hey, look what we got from it. And sometimes I like a month later I'm like I wonder if that sold. And I'll literally look it up to see.

Declan Spring: 11:54

If it sold.

Lara Richmond: 11:55

Yeah, to see what you guys got for it and see how we did.

Declan Spring: 12:06

Sort of check in so good and your choices on cabinetry and floors and I mean it was such lovely work and all those little nitpicky things and light switches making sure they're going to the right three-way switch. Do you remember that?

Lara Richmond: 12:11

Oh, the stairway. Yeah, those are always super fun. There's always more of them than you think there are. Yeah, but what a great success.

Declan Spring: 12:19

You know, it was exactly. It was the perfect project, free model, and it came out better than expected. Everybody was thrilled. So those are more or less the kinds of projects that you're doing day in, day out, right.

Lara Richmond: 12:33

Yeah, those are really. Those are sort of the bread and butter for me.

Lara Richmond: 12:36

And one of the things I want to remember about that project was we got to the end and then we found things on the inspection, like the toilet underneath or things we hadn't seen. And we don't walk away when we're done. We stay, we finish, we correct things if there are mistakes or if there are new mistakes or things found. We don't leave you in the lurch, we don't wipe our hands and say thanks for the contract and run off and leave you holding things you don't want to hold. So we see people through their pest inspections that come later, home inspections if you need us to come back.

Declan Spring: 13:09

Yes.

Lara Richmond: 13:09

You know we want to be the people you're calling and we want to see you to the end.

Declan Spring: 13:12

Yeah, that's very smart. You know it's very smart. And you know I remember there was some tiny issue came up after the new owners had moved in. I made a call to you Very quickly, you know. Your guys went in, corrected the problem. It was just something very small and you were there to do that even after close. Yes, and it's just so nice and you're local in the East Bay, I'm like a community kind of person. The fact that you just live around the corner here is, you know, it's really really nice as well because you're a neighbor.

Lara Richmond: 13:49

Right and live around the corner here's right, you know it's really really nice as well, because you, you're a neighbor right, and that's for us free models thing is really like our house is our home base, yeah, and so they sort of give each of us a territory so that my territory is anything I can hit in 30 minutes I see and so I'm sort of you know, pinol to oakland, yes, and I can, you know, go as far as moraga.

Lara Richmond: 14:02

I saw something this morning in Lafayette. I'll probably inch over and give that guy a hand. It's not a huge project. I won't be there for six months, but I try not to go over the bridges. Ok, and so, but people can. If you find like it's a light load and you get a call for something in San Francisco. You get to decide if you go. But technically we're sort of given this smaller area because the idea is, if I'm over here and there's an emergency, I can get there now.

Lara Richmond: 14:27

I'm not going to have an hour and a half of traffic, I'm not going to be, I'm not going to have things in San Jose or something else where I can't get there. As a project manager, I need to be able to show up, like within an hour.

Declan Spring: 14:37

Oh, that's amazing, and so that's why we do it that way.

Lara Richmond: 14:40

That's partly why you were given my name. This is my circle, I am here, yeah, but it also for me it means not only I mean, I love houses and I love doing renovations but it means I'm improving my own neighborhood yeah, and I'm making the place where we live a nicer place, all these beautiful old homes. We're bringing them back to life and giving them and you know, and hopefully another 80 years with more families yes and more life happening there, and that to me feels really good.

Lara Richmond: 15:04

I'm not doing it somewhere else in the. Caribbean or you know, someplace not associated with me. I'm doing it down the street.

Declan Spring: 15:10

I love that. You're a good neighbor, it's a good company. You're, you're, you make great neighbors and you know and we're, we're very happy to have you in this marketplace and helping our clients. And so the nuts and bolts of it, let's just go through it Well. So for that particular house, you guys came in, you identified the projects you wanted to do, you gave a very, very beautifully presented summary and line items and here's the cost. And then, at the end of the day, the owner asks oh, when do I pay all this back?

Lara Richmond: 15:44

And you pay it back at escrow when you sell. So basically, when you sign a contract with us, part of that contract is the project scope. This is what we've agreed to do for X amount. The other part is a deed of trust which basically puts us in line behind the bank at escrow to get paid before the owner gets paid. So, they have to sign that because in case there's some huge gap, free model's not, you know, that's their surety of recouping the costs.

Declan Spring: 16:10

There you go. So this is not a loan.

Lara Richmond: 16:13

No, there's no interest charge, and when you start a project with free model, the day our project starts is the day I can start charging and like ordering materials.

Declan Spring: 16:22

Right.

Lara Richmond: 16:22

And the project start, really for the loan or the amount that we've given you is the day the project is completed. So when you say I agree, all tasks are done, we start a year calendar and you have a year to sell the house, with no penalty, no interest, no nothing. So really you're holding free models money for up to a year with no interest. So not alone, but kind of alone I mean-.

Declan Spring: 16:44

It's kind of alone. While you're paying the costs associated with the renovation to the contractors, everybody's getting paid. So the whole project's getting paid for, but it's not alone. No, you get repaid on the day escrow closes. It gets dispersed your direction to the penny and that's how it gets paid for. Now, in order to qualify to work with Fremodel and have this wonderful system work for you to your benefit as a homeowner selling property, how do you qualify?

Lara Richmond: 17:19

So Fremodel qualifies owners. Basically, it's part information from you, the agent. So you're going to say we're going to put together the scope of work and say, okay, we're going to spend $150,000 on this house and you're going to say, okay, it would sell for a million dollars as is. But if we do that $150,000, we're going to sell for 1.4 or whatever.

Lara Richmond: 17:40

So, we sort of want to know what that margin is the change in sale versus how much renovation cost. And we're looking for sweet spots where, after you pay us back, at least you'll be making the same amount to you that you will have paid for the renovation. That's sort of the nice spot. It's where you've done enough but you don't want to over-improve, where they're going to get $40,000 and they've paid $250,000. Like that's not a good use of their money or their time, right? So it's sizing. The renovation is really decided between the agent, who knows what the marketability is, and us saying this is what your renovation costs. And we want to, we want to choose those numbers together correctly. So I can give you a project scope that's $300,000, but you can use it like a menu. Yes, no, yes, no.

Lara Richmond: 18:21

You do the things you want and you selectively choose and then that's how we put that together. And then for free model, they need a mortgage statement. So or you know if you paid off the house, your tax prelim, if you have, you know if it's like an estate or something else, we need a state paperwork. So all we need to know is if what you owe on the house plus what free model is going to put in on the house. So let's say you owe 500, we're going to put in 150, you're at 650 and when we're all done it's going to sell for a million. You're okay. We, the cost spent on the house, have to be 80 percent or less what you think it's going to sell for.

Declan Spring: 19:01

I I see so that's our margin.

Lara Richmond: 19:03

So they want that extra 20% margin to know that they're clear in case it's a bad market month or an election year or all the things we know that make people squirrely and make prices change on a dime right. So here, $100,000 isn't a big change on a house price Really. When you're looking at 1.6 and 1.7 and 1.8, it sounds like a lot, but those margins can move pretty quickly. So that's why they're careful about that 80%. You want to leave yourself that balance. So Fremont knows they get paid at the end.

Declan Spring: 19:33

So that's their calculation. Okay, perfect, thank you for talking me through that. And of course the show notes are going to have a link to Fremont and that whole thing, so people can dive in a little deeper. Yes, but thanks for explaining. Now you will also work on behalf of folks who simply want to remodel their home yes, and they're not looking to sell their property.

Lara Richmond: 19:55

Correct.

Declan Spring: 19:55

And so I have no idea how that works, but we should just touch on it very briefly here, in case there's any homeowner listening who? Why would they turn to you for? For your expertise and your, your, your strategy, if? If they're not selling, Explain that to me.

Lara Richmond: 20:11

So I I will. So this part is interesting and I've done a bunch of these where I helped. A realtor brought me in to do a sale and they liked the design so much on the house they sold. They asked me to get the next house ready before they moved in. And so I've worked for the same couple two different houses. So I finished one. It went on the market and I've had ones where they bought first and we did that house first and then when they moved in we prepped that one to sell.

Lara Richmond: 20:36

So in both directions but I've worked with clients on both sides of the purchase.

Lara Richmond: 20:41

And sometimes it's just they. You know, they've just bought a house and they need a designer, and most people don't have one on tap. That's not a thing I think most people carry around in their pocket, and so they, you know, agents now are working with these design companies and they have our names, so we can come in and do this with free model as well. It's called an invoiced project. So the first part is the same. We come out, come up with our scope Everybody agrees on what that is and then we decide how long that project is going to take. If it's an eight week project, you are going to pay every two weeks on an invoice project.

Lara Richmond: 21:15

So, you're going to pay 25% the first two weeks and your last payment you pay when the project is completed. So if, let's say, you have a change order in the middle and you decide you're also going to do your pool and you're going to do something else, and you add $25,000 of stuff because it's going well and you're happy and you want to do a few other things, we put your change order in, we recalculate what it is, we recalculate the time and then you're going to pay the new percentages per your two week installments until the project's done.

Declan Spring: 21:42

I see it, that makes sense and everything moves along fairly well. And then occasionally, laura, there are projects that are, you know, just design projects perhaps, that just aren't a good fit for free model. There's no need for free model, but you're a great designer and people may want to tap into your skillset and work with you on a project just for design only. You're available to do that, right I am.

Lara Richmond: 22:06

I have a private company that's my own, it's called agave interior design, and I do both I have. So I have some that are private, just design only. I do some of this with realtors who are? Having to manage their own projects. They can't afford free model, their client doesn't want to use it, or for whatever else. They just don't want to pick anything anymore they don't want to choose all the lights in the tile and they'll just say you know, here's a list of spreadsheets.

Lara Richmond: 22:27

Can you choose these things and make a design board for me? Sometimes it's that, sometimes it's. Can you do this and then help me find a contractor? Yes, I can do that. I have a huge slew of contractors I work with, depending on what you need, and so I do some of those when people like they want an invoice project but they really can't afford the free model markup. And they don't necessarily need project management to do a bathroom.

Lara Richmond: 22:48

Yes, right, so I can help them put it together and then, you know, oversee it, come by a couple of times, check on them, make sure the guy I've recommended to build it is doing what he's supposed to. Yes, and so there are. You know, there's sort of levels of design that people need, depending on the project, and I have one now where they just want, like furnishings and actual interior design, not even a remodel, and this main level of their home.

Lara Richmond: 23:10

They need furniture and paint and things on the windows and rugs and art, and so I'm doing that for private clients as well.

Declan Spring: 23:18

Yeah, and it's, and it's so great because, like you know, for example, if I go let's just say I go on Amazon to look at sconces today, right, I mean it's overwhelming right, whereas this is the world you live in Like day by day by day. You're just selecting from this overwhelming number of products out there and I love that about you because you know you have brought stuff into projects where I'm just like I don't know where she's getting this stuff from necessarily, but it's hard to go.

Lara Richmond: 23:49

Look, I mean and talk about analysis, paralysis like the minute you're looking for, like a black flush mount light fixture and you're like um, and now it's got to go with the other six that are in view at the same time.

Lara Richmond: 23:58

but they shouldn't all be the same and there are a lot, and you have to know. I just had this with a client who walked through her house and saw all the material boxes that we haven't opened because we're still in the middle of demolition and some of the lights say matte, black and some of them say bronze. He was very upset. He's an architect very meticulous and he's like this is not acceptable. I was like no, actually bronze from West Elm is black, so let's open the boxes.

Declan Spring: 24:22

Yeah.

Lara Richmond: 24:23

But to know that, to know that when I order that it's going to look like this, Like there's no, the experience of that just is you know, that's why you hire people to do that. Like I don't change the oil in my car, guess why, right, I mean, that's not my skill set. I'm sure I could learn it I'm not an idiot but like, that's not what I do all day.

Declan Spring: 24:42

It's a time saver To have you in and select stuff. It's priceless. I honestly, for you, know it's priceless and it works out to everyone's benefit. It's a win win. It's just a win, win. Does free model take a percentage of the final home sales price or is it strictly just the renovation fee?

Lara Richmond: 25:01

strictly the renovation fee, so any profits made. I mean that really is the whole point that's the whole point is we're doing this for the homeowner, yeah, so whatever margin we take and it's not tiny, I mean, you're there's always even if you have a general contractor, they have a margin on top of their subs and they bring in and we bring design and project management on top of just construction, so there is the margin for that and then they fund the money. So there is, there is that chunk, but that's it yeah, so once you know what you're paying us.

Lara Richmond: 25:30

If you make two hundred thousand dollars in your house, all yours yeah if you make six hundred thousand dollars in your house right still all yours right. So in that sense it's it's really a great bet if you're in a good place good house, good market.

Declan Spring: 25:42

Yes.

Lara Richmond: 25:43

There's no losing.

Declan Spring: 25:44

There's no losing. And you know also, you know, a lot of times, especially if it's a home somebody's owned for decades and they've pretty much paid it off right, they're going to have this massive tax liability. And so they, you know, once they realize that they're often looking for projects to pay for to, you know, mitigate that, that liability. This, this comes in handy.

Lara Richmond: 26:04

I mean it literally it makes sense to spend some money if you're facing down a massive, you know, capital gains absolutely yeah actually, something I learned just about a year ago was that home staging actually started here in the bay area yeah, I don't know if you and so I didn't know that.

Lara Richmond: 26:20

But now I'm doing tons of work with stagers so this stuff comes across. Yeah, but I've lived in, sold houses in many other states where nobody does that, yeah, and here it's such a huge part of home sale, like even homes where you do nothing. Yeah, except, like you know, correct leakage or you know what I mean or fix one rotten panel or something else, they still empty and stage the house. That's such a funny thing here, but it tells you what do buyers expect to see?

Declan Spring: 26:48

right.

Lara Richmond: 26:49

Even in a rundown house. They want to see cute furniture, they want to imagine a modern life there, and so, for us, anything we can create so that we look good in photos right, we're all selling to like millennials on the internet. Um, that my job is to create so that we look good in photos right. We're all selling to like millennials on the internet that my job is to create something that a millennial on the internet is going to say I want to go see that house in person.

Declan Spring: 27:07

No, you're absolutely right. You know. The way I explain it to my clients who are looking to sell their property is we have about a two second window of time where somebody is going to look at the first photo on their phone of your property and if it's not the perfect, if it doesn't resonate or hit them perfectly, we're not getting second number three, we're just going to be pushed off and they're never coming to the open house.

Lara Richmond: 27:30

They're just going to scroll, yeah.

Declan Spring: 27:32

Yeah, so I mean, that's it, that's your opportunity. Right Is a second or two on somebody's phone and they might be walking down the street. Right, there's a second or two on somebody's phone and they might be walking down the street and you know they can't even fully concentrate and they're going to dismiss it.

Lara Richmond: 27:44

No, they're trying not to get hit by a car while they drink their Starbucks and scroll right Like everybody's distracted and busy and short of attention, and I think that's where staging probably started here.

Declan Spring: 27:55

I think we have some of the most intelligent realtors in the entire country all kind of nested here in this kind of Berkeley.

Lara Richmond: 28:08

North.

Declan Spring: 28:08

Oakland area in my opinion. But we also have a ferociously competitive market right. So any advantage you can have when you're listing property, you want to take advantage of anything that you might have within reach. I think Berkeley is also the home of that list versus sales price peculiarity Like there's nowhere else in the country outside of the East Bay where property routinely sells 40% over that whole manufactured. You know it's an entirely manufactured situation.

Lara Richmond: 28:37

Yes, and it's a history of underpricing, knowing people are going to overbid, right, but some of it's insane and it creates people's knowledge that, okay, whatever you're looking for, like, oh, I can afford one six, so I'm going to look at anything up to 1.2.

Declan Spring: 28:50

Right.

Lara Richmond: 28:50

Otherwise I don't have a shot at it.

Declan Spring: 28:52

That's right.

Lara Richmond: 28:52

And so trying to create those numbers and market. I can't imagine as an agent how you're trying, where you're trying to put that, but I've worked on a couple of projects. One in Berkeley that was actually two houses on the same lot, yeah, and they listed for 1.8 and got 3.1. Wow, so people put 2.8 on that house and lost. Like what, how do you know how to bid on those homes?

Declan Spring: 29:14

I mean I've got a couple, I can just tell you in the last week like oh really, oh, I mean, mean where, where I had clients writing an offer on property, that I think both properties, one of them sold 80 percent over and one of them went 100 percent over, and that's just the market that we're in this particular moment in time. Yeah, and you know, but that kind of pricing, along with staging, that kind of stuff, did you? I've heard the stories too that that really just all started here and it's because of our incredibly intelligent group of realtors and just the ferocity of the market.

Lara Richmond: 29:51

Well, and also, if you live in the Bay Area, we do have the best weather, yeah. So if you're working in the city or in the Facebook camp or whatever else, tell me what you want to about the North city or the Facebook camp or whatever else. Tell me what you want to about the North Bay and the South Bay and everywhere else, or trying to live in the city and navigate. But the East Bay by far has the sunniest, nicest weather and we have great schools and we don't have to cross bridges to go to Lake Tahoe or out to the farm stands or to get down to Santa Cruz or whatever else. So we're really in this beautiful sweet spot and then we get the view of the water and the city.

Lara Richmond: 30:25

So this is it is a sweet place to live.

Declan Spring: 30:28

Yes.

Lara Richmond: 30:29

And it's not like there's a lot of people here, but the neighborhoods still feel like neighborhoods. Yes, I mean, I grew up here, actually on the backside of this hill in Arenda. That's where I grew up. I didn't know that. Yeah, I lived here until I was 16 and we moved, but I came back. I've been here seven years and this is where I wanted to come back to and I love this place for that.

Declan Spring: 30:49

Wow, those East coast winters you couldn't 25 years in DC and New York.

Lara Richmond: 30:53

I was, I was all done. Yes, it was time to come home. Yeah, I would say, the craziest house I did, I did last year and it was a two bedroom, one bath in Berkeley yeah, a block off Solano.

Declan Spring: 31:06

Yeah.

Lara Richmond: 31:06

So walking to everything and we did everything. We probably put 220 into that house and it was a thousand square feet, so full heat pump with air, and we took down, you know, basically 12 dead trees. I think had rebuilt the backyard, new bathroom, new kitchen, but only two bedrooms and like a little den that really couldn't even be called a bedroom.

Declan Spring: 31:26

Yeah.

Lara Richmond: 31:26

And they listed it for 1.8,.

Declan Spring: 31:30

I guess yeah.

Lara Richmond: 31:31

And sold it for 2.1. Wow, highest price ever sold for a two bedroom square footage in Berkeley.

Declan Spring: 31:36

Wow, and that was last summer. I remember the house.

Lara Richmond: 31:42

And so that was, that was last summer. I remember that was. That was insane when we heard that, because we had a friend who was a realtor who was looking at it with clients. She's like my clients are totally gonna get it, they're gonna bid 1.9. And we're like that's crazy. And then they didn't get it. We were like isn't that? That was that is an insane number to pay for a thousand square feet. Who pays that?

Declan Spring: 31:57

it is insane, yeah, but you know it's supply demand and you guys did a fantastic job.

Lara Richmond: 32:03

Yeah, the house was perfect like nobody was gonna have to do anything for 100 years on that house right, all new wiring, all new plumbing, all new everything right, so it's well worth it.

Declan Spring: 32:10

Yeah, so I mean. So I think, shout out to arlene baxter, would that be correct?

Lara Richmond: 32:14

yes, that was arlene baxter who did that with us and the client who had lived there and left during the pandemic and then had a tenant who wouldn't leave. So it took a couple of years to have the tenant get out. But he was like in Colorado or someplace, not here, and he's like I can't keep carrying that, I need that to soak. I got to do like the rest of my life and he showed up with a friend of his at the end and they walked around like spinning, like children in the living room and they're like if we knew it looked like this, maybe we'd have stayed. And then they saw how much they got and they ran. So they took the check with a smile, but they were thrilled.

Lara Richmond: 32:49

Oh, I'm sure they were he didn't have to put anything up and he got this huge unexpected payout.

Declan Spring: 32:54

Wow.

Lara Richmond: 32:55

After like the pain of a tenant that won't leave and we all know here in the Bay Area, with the rent control and everything else, how hard it is to get tenants out, especially after the pandemic, when they didn't have to pay rent and just as a landlord you were stuck eating all those costs. This guy ate a lot of money and cost for that and then we felt really good that we were able to sort of liberate some of that off his books. It was really nice.

Declan Spring: 33:15

It made you feel really good. Oh yeah, it just makes you feel useful and satisfied. And you know it matters. What you're doing matters.

Lara Richmond: 33:22

It does and somebody is going to move into this house and I'm really proud of the work we did there. We made something beautiful for something at somebody else and that feels great.

Declan Spring: 33:29

It does, I know what you mean. It just feels really good. Sometimes our work is just really makes you just feel so darn good, you know.

Lara Richmond: 33:36

Yeah, it's satisfying.

Declan Spring: 33:37

So what happens if a homeowner decides, like they love your work so much they're not going to sell the house anymore? Has that ever happened?

Lara Richmond: 33:45

Yes, and that's really how you know you've done the best job ever. They see it and they're like never mind, we're not moving. It's rare. Most people because we stage here people have exited before we come, so they've already created another situation. Do you know what I mean? But it happens rarely, but it happens. And basically, if they decide to take the house off the market whether they decide to stay in it or just decide to rent it or do anything else they get it.

Lara Richmond: 34:13

We'll invoice them for the total of the project and they can just write a check and keep the house.

Declan Spring: 34:16

There you go. I'm amazed that it's happened, but I'm not but I'm kind of not at the same time.

Lara Richmond: 34:22

Yeah, I mean, I think some people. I've had a client who had like a house in Walnut Creek and one in Menlo Park and they had sort of been living down there and they came out here for the kids. Then the kids were off at college and they were like we're missing our friends and they they sort of couldn't decide where they wanted to be and so they were going to free model one and then I think they just decided to keep that one and then sell the other, but the other was done or something like that. So they were, you know, they were sort of back and forth and they had another option.

Lara Richmond: 34:49

And so but you never know, everyone's got their own set of circumstances.

Declan Spring: 34:53

Yeah, right, yeah, I love it, I love it. Can I was going to ask you about, like, how you so you're bringing in contractors and various trades people, even sometimes stagers how do you vet the contractors that you choose to work with?

Lara Richmond: 35:09

So this is a great question. So when I came to Fremont four years ago, they'd been in business about a year. I was employee number eight and that includes the founders. Wow, eight, and that includes the founders. So I am they'd like. John still calls me OG, which is like I was the first person that the founders hired. That they didn't know before they were hired.

Lara Richmond: 35:27

So I was the fourth project director. The first one is John's sister and then, like a college roommate's wife in Moran, and then Joelle in the city and me here were hired at the same time, and so I was the first person in the East Bay. So when we started this, all of us are coming new. I'm the first person in the East Bay. So when we started this, all of us are coming new. I'm the first person in the East Bay. There are no contractors here. I had to start so the first time. It's very awkward. When I started this job because I would have to bring three electricians to the bidding walkthrough, not just bring my known crew, and so I'm trying to piece together. You know which painters I like. Some of them don't show up to the bidding thing Like you know what it's like trying to get people to come to your own house.

Declan Spring: 36:04

Right.

Lara Richmond: 36:04

The first few projects we did like that, felt like that as somebody who's supposed to be a project manager. So we did not have a cache of people to draw from.

Declan Spring: 36:12

I created my stable of people myself. You build your own network, we built our own.

Lara Richmond: 36:18

So that was true for the first sort of year to 18 months, and then they hired a contract team. So, they have been grabbing, you know, they've been vetting and we have sort of a contractor database now. So if I'm here and my electricians are busy or one just went to Thailand or whatever happened, which actually just happened, and can't do the job for me, I need other people. I do have a contractor database I can start calling from.

Declan Spring: 36:40

I see, I see.

Lara Richmond: 36:42

And if we find somebody we really like, or let's say, you say, hey, I'd like to use my electrician. Can we do him through free model. Is that possible? It is, but free model pays our vendors. And so they have to go through a process of getting signed up with free model to be payable, which means they need to be licensed and insured and all of those things, because free model has a license that we're not going to put at risk by hiring unlicensed people so everybody has to be sort of vetted by free model, and then I can pull whoever I want onto my team that way.

Lara Richmond: 37:12

So you can always add people if you want to do that, or you can grab somebody. Somebody else has added or the contract team has added and pull them in and try them out. Um, yes, and so we can do that. But those of us who sort of came in early and built our own teams, that is a hard process and you have to find the right people that you want to keep working with.

Lara Richmond: 37:30

That show up that can work together and so like that is something that saves me on my job. My painter and my handyman are friends and know each other and we all have each other's phone numbers, so sometimes they have an issue to work out. Does it need to go through me?

Declan Spring: 37:44

Right.

Lara Richmond: 37:45

The painter's like I need Frank to move these things before I do this thing. And Frank, he just hey, frank, yeah, I'm coming, I'll be there at eight. Great, we'll come at nine and that doesn't even make it to me Like I, years later, are a well-oiled machine. These crews that come on, and that's what you try to build.

Lara Richmond: 38:01

Yes, absolutely, there's this trust and this you know, and people will throw somebody else's trash away if they need to. When you have new guys and they don't know each other, everybody's like that's. Somebody else made that mess, somebody else scratched that cabinet, nobody wants to own up to it. When you start doing this together, the presentation belongs to everybody.

Declan Spring: 38:21

Yes, I think every realtor you know just working smaller, more mundane projects, understands exactly what you're talking about. Like when I'm not using free model, I have a guy who always does the floor refinishing right. He knows my handyman. They talk to each other, they schedule around each other. They don't have to right and you know, and I you know every realtor like that's that's a beautiful moment when you but how long does it take to build that?

Declan Spring: 38:44

it doesn't yeah, it doesn't happen overnight it takes a while to build crews right I mean, the good news is we do so much of this.

Lara Richmond: 38:51

You know a lot of my crews. I am their employer, almost right, like I my business is busy enough.

Declan Spring: 38:58

I have two crews basically working for me full time and they're just kind of working full time and they're full time Wow.

Lara Richmond: 39:03

I'm keeping everybody in business.

Declan Spring: 39:05

It's amazing. So. So, when most realtors are working on projects and not using free model, we have that additional layer occasionally where you have a client or homeowner who wants to be very involved in the whole design process. And I'm curious about you, know your thoughts on that and you know, do you? Will you work with a homeowner if they, if their preference is something that they feel is?

Lara Richmond: 39:33

Yeah, so this is. This is a sticky spot for free model, because my job is to deliver something to the market to make them money, and it is very hard to walk to tell somebody and you it's not that they don't have good taste, it's that they don't have internet market taste for this neighborhood and it's and I'm always trying to convey to them we're going to walk through your house and say we're going to change things and it is isn't about you. The minute you decide to sell, we're presenting this in photos on the internet for people of this age. This is who's going to buy, so we're designing for them and also, the things I'm putting in your house aren't things that would go in my house it's not like I think I have the best taste in the universe and I'm putting my favorite things in your house.

Lara Richmond: 40:18

It's not that either. My job is to create the marketed project Right, and so trying to let people know that it's, in that sense, really impersonal.

Declan Spring: 40:27

Yes.

Lara Richmond: 40:27

The things that we choose. Yes, I can look at your house and say, okay, this is the architecture. We want to work, you know, make it look modern and clean and new, but also work with the architecture of your house. Is it a mid-century, is it a craftsman? And how do we pull those elements in so that these new modern things feel true to the house.

Lara Richmond: 40:44

So I feel like that is really my job and helping people find that sweet spot and trying to describe my process to people they're like well, I really like this light. Okay, if we put that here, it's going to block your biggest window with the view. It's a great light, but there's a reason we wouldn't put it in this location, and so talking people through this is why we choose these things. Often, if you get through, a couple of those people are like they understand, like there are questions they're not asking because it's not their job. Right, people can like what they like, but it's not their job.

Lara Richmond: 41:18

And so we try to let people know like we're doing this to make you money, not to make you feel bad about your design choices, and I can put whatever you want in your next house.

Declan Spring: 41:27

Right but this house.

Lara Richmond: 41:29

You've brought us in to do this thing and please let me do my job. And some clients can't let it go and want to see everything. Those end up being difficult projects because the clients are not letting go of the house, they're still holding on. I have clients who basically always wanted to renovate that house and so when they bring free model in to get it ready for the market, they basically want me to do the renovation they could never afford.

Declan Spring: 41:51

They're scratching their own itch, but it's not in their best interest.

Lara Richmond: 41:54

No, it's not, and it's very hard, and those end up being worse outcomes.

Declan Spring: 41:59

Okay so.

Lara Richmond: 42:00

Because you're trying to compromise or work with these people and they're making choices that are not yeah, that are not going to help the sale of their home.

Declan Spring: 42:08

Got it.

Lara Richmond: 42:08

But they think that this is how the house should have always been. It's what I would have done. And then they want free model to do their own HGTV on the house that they're about to sell. Yeah, but it's hard for me to feel good about a project when I know that that's not how the house will best show and there's only so much of you can sort of say that nicely before. The client owns the house and is paying for the project and we have to.

Declan Spring: 42:33

Yeah, I get it, I get it, but those are challenging Cause it cause they're basically shooting themselves in the foot.

Lara Richmond: 42:39

They are and it's hard to tell them that. Yeah, so for an invoice project where somebody's Because they're basically shooting themselves in the foot.

Declan Spring: 42:42

They are, and it's hard to tell them that, yeah, yeah. So for an invoice project where somebody's going to continue.

Lara Richmond: 42:45

Anything you want, whatever you want, who cares right?

Declan Spring: 42:46

Why are we doing this? Well, we're trying to target an audience out there and you're not the audience You're selling.

Lara Richmond: 42:53

Right, but everybody thinks they're the audience.

Declan Spring: 42:56

Right, right.

Lara Richmond: 43:02

Right, right, right, right. Well, if I was buying, this is what I would want.

Declan Spring: 43:03

Yeah, but you're not the majority buyer.

Lara Richmond: 43:04

You're 70 and you're this is. We're selling it to people in their late thirties and early forties with young kids that want to move into the Berkeley school district.

Declan Spring: 43:10

Yeah.

Lara Richmond: 43:11

So that is not their aesthetic.

Declan Spring: 43:13

Yes.

Lara Richmond: 43:14

They don't want antiques from the forties. They, you know. You may think this is a beautiful look and it's fine, but I walk in and this feels and I'm in my 50s, this feels like my grandmother's house right, beautiful, some gorgeous pieces, but not modern, comfortable, current lifestyle yes, this is, you know.

Lara Richmond: 43:31

so we're trying to create this thing that your market is looking for, and it's if you, if you keep stepping in the way, it's going to take longer, it's going to cost more and you're going to have a worse outcome, and so, but it's. It's very hard to share that information in a way that doesn't hurt people's feelings or make them upset, and I so I'm always walking a fine line.

Declan Spring: 43:50

Yeah, but I'm sure there's very often a moment where you've connected with them, what you're saying makes sense and they let go. Is that a beautiful moment?

Lara Richmond: 43:58

It's a fantastic moment and then some people never let go and then they weren't satisfied to start because they always wanted to do it themselves. Often those are the people that are selling under duress, that don't really want to sell.

Lara Richmond: 44:10

So, they're at least going to see the house done the way they want before they have to let it go. And so some people there's no moving. And then other people I had somebody once this was my favorite. I walked into a house with an agent that I knew well and we had done, you know, six or seven projects together at that point. And the clients are like so here, look around.

Lara Richmond: 44:28

And then the guy turns around and hands me a key and I'm like I haven't given you an initial estimate yet. I brought no subs by. You don't know what this is going to cost. Maybe you want to give this to the agent. And he's like no, it's gonna be great, we're going to portugal on tuesday, right, and let me know when it's done. I'm like well, I write, you know, weekly updates to keep you paid. He's like sure. So they handed me a key. I'm like I'm gonna put it in a lock box so we all feel comfortable. I have one in my car. But he was like I don't want to do anything with this house other than get a check at the end yeah, yeah, and they and I would would send them updates on Fridays and they'd be like we're on our way to Porto, we're on the train, photos look great.

Lara Richmond: 45:03

Thanks Bye, you're like okay.

Declan Spring: 45:05

Yeah, I never saw them again. That's amazing.

Lara Richmond: 45:07

And they, you know they did well in the house and then moved overseas and apparently lived happily ever after, I guess, but they talk about not holding on tight. Here's a key Do whatever you want, yeah they had a better.

Declan Spring: 45:19

Why I notice often with clients who are looking to purchase a new home and sell the current home, if they can afford to at all, it's nice. If they can make the purchase which you know financially, it's a demand right.

Lara Richmond: 45:35

It's challenging here, but if they can.

Declan Spring: 45:37

I always find it's so much better for their mental health because of the act of purchasing the new home. Now they have no reason to keep the old one, so they just want to get it sold.

Lara Richmond: 45:48

Right Once you put in boxes in the new place.

Declan Spring: 45:50

talk about rear view mirror right, and now it's just like how quickly can we sell that house?

Lara Richmond: 45:54

Right, they're not invested in which light goes in the entry, whether their grandfather installed it there or not right. Like this is Right, exactly, nobody cares anymore. Life has moved on, absolutely.

Declan Spring: 46:04

So let's say you're working on a project. How does free model protect homeowners from like unexpected cost overruns?

Lara Richmond: 46:12

So free model part of our contract is everything is lie-dyed. So one of the things that I've had issues with agents in the past is basically we put together a project scope, like you said, with, like you know, dimmer switches. Go on my project scope because that's 30 bucks instead of two bucks, like if you want nine dimmer switches. That's real money. So that goes on the list, we itemize everything we're going to do and then that's the project. But often what happens?

Lara Richmond: 46:37

agents come in at the end and now that it looks so good, the things they cut off, trying to save money yeah they actually really still want it done, but now they want it for free because, like, the house isn't perfect, and then they expect us to come and sort of finish all this other stuff that isn't in the contract, and so for me that's tricky and they're like well, you're here, can't your plumber just right no, that's not how this works. This is a task-based contract. If you want to add it, we do change orders, so we do not have like a contingency.

Declan Spring: 47:08

Okay.

Lara Richmond: 47:09

We don't do that. We say okay and I always try to prepare my people in advance. Like we know, there's some rot in this wall. We're going to fix the drywall. But if I open that and find mold, we have to call somebody. We can't close that up legally. We're going to have to do these things. We don't know what we're going to find. So, I try to let people know where I think the surprises might come from.

Declan Spring: 47:28

Right, okay.

Lara Richmond: 47:29

And those you can't know ahead of time. That's part of building is there can be something. The lighter touch you have, the less of that you're going to find. But when you do deep things like kitchens and baths, you could find a bad drain. You could find all kinds of things in there water damage and things that you have to resolve before you put the house back together. So for me, as soon as we find that, we take photos, I get my guys to give me bids and we create a change order and say, hey, this is what we found this week.

Lara Richmond: 47:57

These are the mitigating things we need to do. These are things we can do. Here's what we have to do. Here are the costs. Do you approve that work? And they get a change order, and if they do, they sign the change order and we keep moving and so that's it. Everything is done by change order. Nothing is done without that, unless it's an emergency. If something breaks, we will bring a plumber to fix it so we don't flood your house waiting for you to sign a change order, like nobody does. That we're not ridiculous.

Declan Spring: 48:23

Right.

Lara Richmond: 48:23

But we don't move ahead with those projects unless there's like we have to.

Declan Spring: 48:28

Right, right. That makes perfect sense and I've seen it in practice.

Lara Richmond: 48:32

Right.

Declan Spring: 48:33

And it's logic, it's the logical approach, right, and it's fair for everybody.

Lara Richmond: 48:37

Yes, and people, and we do, but we do try to tell people like this is what we expect your project to cost if there are no surprises.

Declan Spring: 48:43

Yes.

Lara Richmond: 48:43

You know, if your house is this old and you've done zero maintenance, we should expect some surprises. These are the places I think we'll find them.

Declan Spring: 48:51

Yeah, yeah.

Lara Richmond: 48:52

And if you're really worried about surprises, then you'll be smart and you'll do your pest and home inspections first. Nobody likes to do that. They don't want records of what the house was. But I'm not a home inspector. I can see what I can see. But I do not go through and do my walkthrough and poke at woodwork on your fascia.

Declan Spring: 49:14

You know what. That's a good point, because for the couple of projects I've worked with you on, I got a pest before I reached out to you.

Lara Richmond: 49:18

Yes, that's very unusual, you should know.

Declan Spring: 49:21

Oh, really, and super appreciate it. Oh, it makes so much sense to me Lots of people.

Lara Richmond: 49:25

they want us to finish the house and make it perfect so that the pest report is clean. Get perfect so that the pest report is clean and I'm like I can't do that because I'm not a pest inspector.

Lara Richmond: 49:35

I don't do free pest inspections as part of my sort of aesthetic walkthrough of this home, and so, if you want a clear pest inspection, get a pest report and that way, when we've taken the house apart, we're going to fix it during the course of our construction. If you don't do that and you get a pest at the end, what if you find things that were you know? Didn't you see that under the house? No I didn't go looking under the house yeah, I didn't have projects under the house.

Lara Richmond: 49:57

It wasn't my job to find that for you and correct it, do you know? I mean so the expectation that I'm going to show up and be an inspector and cover all that work, and yeah, so for me, I, if people are really like, want everything at 100 at the the end, please get those, because the worst thing is we finish the house and then they find something and we're going to what? Rip out the shower to correct it. Like nobody wants to do that work twice or pay for it, right?

Declan Spring: 50:22

It's so interesting to me that you're saying that doesn't happen very often that you get a pass report, like I was talking to a home inspector the other day, cause I'm more often now encouraging clients who want to list property with me. I'm more often encouraging them now to um to do a verbal walkthrough with an inspector. Not a written report, but like just do a full walk around. I take all the notes, I know what all the action items are. It's not documented, it's not a disclosure, it's just kind of a heads up. That would also be appropriate.

Lara Richmond: 50:53

I would just want to see that list.

Declan Spring: 50:54

Yeah.

Lara Richmond: 50:55

Right, you can give it to me without, or show it to me or read it over the phone, where I can take my own notes and whatever. I know people don't always want to have everything written down. I understand, for disclosures, why people make those decisions, but it puts everybody in a tight spot. At the end. We're trying to stage your house yeah and get people to come through for broker opens and now you want us to fix deck boards that were painted, that they found rot underneath at a stair and like why are we?

Declan Spring: 51:21

doing this now yeah, yeah, right, and it puts everybody in a tight spot at the end, because you, you know, you got to know the chessboard, you got to know how the game is played. You have to know the moves. You know because we know what's coming up like four weeks from now if we're getting a property ready but we didn't do the pest inspection. Yeah, you're, you're setting yourself up for a problematic inspection.

Lara Richmond: 51:44

You know you are, you are and then. But I don't want that to. That's hard when they decide it's my problem that I should have caught everything on a pest inspection.

Declan Spring: 51:51

Yeah.

Lara Richmond: 51:52

That's my job is not to be an inspector.

Declan Spring: 51:55

Do you know what I mean? Do you recommend? If an agent calls and it's a big project, do you sort of say, hey, you might want to think about doing a pest inspection? I always encourage it, you do.

Lara Richmond: 52:04

And more now. I don't think I did it enough when I was starting. Yeah no-transcript, but anything where we're going to do really a full kitchen, full bath, or it's a really high end property where people do expect a clear section one on their pest report yeah, yeah.

Declan Spring: 52:27

And we have interesting things coming up by the way that I'm finding now. Yeah, and we have interesting things coming up by the way that I'm finding. Now I'm having to talk to the homeowners about and really consider what we do. We know that there's a ban coming into effect January 1st 2029 on gas appliances, that's, furnaces, stoves. So like I was out this week listing a property in Castro Valley fairly soon and the furnace is falling apart. Right, it's ancient, but we decided, you know what, there's no point in replacing this. There's a new roof on the house. It's a perfect time for solar to come in and maybe do a different type of heat system in that house. Like why would we replace a furnace? It doesn't make any sense. The new owner can make a decision with the knowledge that there's a ban coming into effect. You know it's up to them to decide, you know. So understanding what's in store for us in the future, you know, also dictates.

Lara Richmond: 53:31

But not everybody makes those decisions. I have a house right now where they want. It's an old gas furnace with the huge plenums and the asbestos-wrapped ducts. The whole thing's a mess under the house and we had a price to replace the gas furnace because that's what they have. And it was like $2,500 more to do a heat pump and they declined and I thought what a mistake.

Lara Richmond: 53:55

And we have an electric stove in there, with the potential. I mean, we think it was originally gas, but somebody put an electric and I was like great, we're gonna put an induction stove in here. It's berkeley yeah this should. This is how they should go. No, he wants the gas back yeah, I'm like to sell. You want to put all gas appliances back in here. Like this, berkeley's going to be in the front of the line for electrification so this is again.

Lara Richmond: 54:16

This is like you like to cook on gas, but again, it's not for you. And so this is where the market is going to want to see a heat pump and an electric dryer and an electric stove yes and all of those things. So the minute they put solar panels on, it's free. But again, homeowners, people get in their own. Well, this is $3,000 cheaper. But, it's a gas furnace as opposed to a heat pump and it's going to have to go anyway.

Declan Spring: 54:45

Be careful. Where you think you're making a savings, it's often a short-sighted call.

Lara Richmond: 54:50

And a gas furnace for that much money. For an extra three grand, you're going to get air conditioning and I'm sorry but it's getting hotter. You know, like even here in Berkeley, if you're down on the flats or if you're, you know it's much hotter.

Declan Spring: 55:02

There are some hot days here in September and October, so yeah, we're definitely seeing longer runs of warm weather no question about that, absolutely. And longer runs of warm weather no question about that, absolutely. What would be like a really challenging renovation project, and how you handled it.

Lara Richmond: 55:15

I would say I've had a couple of challenging projects in the last couple of years. I had one where the agent did not have a lot of experience with renovation. I think she had mostly worked with people that couldn't afford larger projects. She was excited to try us out and everything went great through her signing off and the hug at the end. And then things kind of fell apart and it was the things that she thought she knew but didn't understand that came back and so like she had gotten a pest report.

Declan Spring: 55:45

Yeah.

Lara Richmond: 55:46

And we went through it and some of the stuff, the fascia they wanted to replace, was going to require us to lift the roof in places to fix it. But they were adamant that this cost amount could not change. Like there could be no change, like we were fixed here Okay. And I said, if we do that piece of fascia and we pull up the roof and find something, we can't leave it. And now you have to disclose it, and now we've done more damage than leaving a single piece of fascia.

Lara Richmond: 56:11

So, we talked about all of these things, it was like, do we do these parts of the pest report and leave these couple of things? Because if we open that and find something, we've hurt ourselves more than you need to move these two pieces of wood.

Declan Spring: 56:24

Right, right.

Lara Richmond: 56:24

So you don't have to be a perfect section one, but you can do most of it. So we talked through all of this stuff and I felt like there was an understanding of what that was and we got to the very end and then she brought the pest inspectors out to clear everything and so, like one place where we had replaced siding, they were like we'd like you to do one more piece. Okay, fine, so come back, put it in, paint it, no problem. And then she went back through and she's like well, you didn't replace these pieces of fascia, we're never going to replace those because we have this conversation where that could be the roof and it could be these other things.

Lara Richmond: 56:58

She's like well, I told them they'd have a perfect section one and now you need to come back and do that and I she's like and I don't care if it's ten thousand dollars, don't you care if your client is happy? Um, we very much care if the client is happy, but if you have told them something incorrect, because you did not understand, like you said, you understood this conversation. I thought we were speaking the same language. She took it away that, like, you'll do everything.

Declan Spring: 57:18

Yeah.

Lara Richmond: 57:18

And so we had to go back through emails and through contract stuff and what people understood and signed.

Declan Spring: 57:23

Yeah.

Lara Richmond: 57:23

And so she ended up leaving very upset because I think for the agent it made her look poor in front of homeowners because she didn't understand her job and I felt like I had explained it, but you don't always know where everybody's level of understanding is.

Declan Spring: 57:36

Yes.

Lara Richmond: 57:37

And so it ended up being sort of communication issues that sank a project that looked great and felt great and everybody felt happy with. And then there were like two or three past line items that didn't happen for reasons we had explained on the front end, yes. And then she was furious that we wouldn't come in and just do them for free at the end right and I was like that's not how free model works. I had to call my company and they were like this is your contract yeah, which you signed and then it just it.

Lara Richmond: 58:05

It got crazier and crazier and like she couldn't let it go, yes, and so that was, that was something.

Lara Richmond: 58:11

And then she showed up the craziest part. She showed up at the open house. She was ready to do one and she's like they had a gate already on their fence and we just put new slats on it. We didn't actually change the gate or the hinges or the lot, it was all fine, we just put new pieces of wood because theirs were rotten. Yeah, and she said you've made the gate too tight, like we didn't adjust the gate, we just put some wood on it. And she's like well, it's not opening. Now it's raining and you've made everything so tight my gate won't open. And she's like and here's what happened. And she showed me a picture of the gate like leaning, like halfway falling off. And I had to send her back a picture of you opening the gate in the wrong direction and you've now broken the hinges Once she was upset. And then that happened.

Lara Richmond: 58:49

And then it was clearly we actually just went back and fixed the gate for free Because we couldn't do the pest stuff for her. We're like I'll send somebody to take care of the gate. Sorry, you're like pushing on the pole gate, but so there were things like that where you just feel like you can't do enough right to right the wrong that they felt.

Lara Richmond: 59:07

Yeah, even if it was what was signed and agreed to and she had the contract list, she knew exactly what was on it and they were spelled out in emails and other things, but it was still. The understanding was missing. And so I always feel like I, even though I felt like we spoke about it ad nauseum, was there something else I could have said to make her not put herself in that position with the buyers? So that was it got uncomfortable.

Declan Spring: 59:29

It's a tough spot to be.

Lara Richmond: 59:31

It is yeah and I I understood for her but, that I don't have ten thousand dollars yeah, to pay for this work and then a new roof yeah if do you know I mean for two pieces of wood. I was like nobody's gonna do that. That's not how this business works and we can't that's right.

Declan Spring: 59:45

That's why those change orders are always handled meticulously well by the way way, and your communication, in my opinion, is meticulous. Thank you, but my goodness. But this is how I'm careful.

Lara Richmond: 59:57

This is what you learn. When I write contracts and we do pest work. I, literally my line item has the item number from the pest report. Yes, 11j from pest report description cost, so that they can't go back and say, well, I thought this meant that. No, this is 11J, not 11I, not 11M. Right, do you know what I mean? Yeah, so there is no confusion. After things like that I am very meticulous about communication.

Declan Spring: 1:00:21

You're so meticulous. I love it, thank you, and the level of care that you bring is. I love it Because you do a Friday update wrap on the project, which, by the way, I notice, often comes in after 9 PM on a Friday. So and I feel like, oh my God, she's not really doing this.

Lara Richmond: 1:00:43

Fridays are my longest day of the week, but that is how I go into my weekend. So, I run all week, but I make no appointments on Fridays.

Declan Spring: 1:00:51

I don't ever see new Fridays.

Lara Richmond: 1:00:51

I don't ever see new properties. I don't. Friday is the day where I go to every active construction project and. I take photos and.

Lara Richmond: 1:00:58

I put together change orders from the week. If there are any issues, we've had any places, we're behind or we're ahead, or we've had, you know, products that aren't showing up and we need to reselect. You know anything? And I've got all my notes together and I'll go home and I'll have seven of those emails to write in an evening. So I'm home at five, 30 or six and I'm writing for three or four hours. So it's photos that now get documented and put in albums. I'm writing contracts, change orders.

Declan Spring: 1:01:23

It's a great system.

Lara Richmond: 1:01:24

But then I go into the weekend, like, even if I work till 10, I've put this in everybody else's box and then I have a weekend. And that's that for me, is mind clearing so that I get to have a weekend.

Declan Spring: 1:01:36

Was that your own decision on how you're? You know how you put together your own systems, or?

Lara Richmond: 1:01:43

was that a?

Declan Spring: 1:01:43

free model directive.

Lara Richmond: 1:01:44

Free model wants us to keep clients updated, but they were, especially when I started, not specific about how.

Declan Spring: 1:01:49

Okay.

Lara Richmond: 1:01:50

That was my decision for how people feel. Here's what we did this week here are the photos through the week. Here are issues we've had. Here's the change order. Here's this other thing. We're actually we don't need to do this, you're going to get a refund. Here's that change order, you know, whatever, it is Right. And then here's what's coming next week.

Declan Spring: 1:02:06

Oh, I love it.

Lara Richmond: 1:02:06

And so people that aren't here, people that are in you know, maryland or North Carolina or Portugal or wherever you know, they're getting their own little HEV wrap ups, you know, on the house. But then it also it helps me as well. It helps me sort of, in my own mind. Okay, I've put these things away. Here are the things I'm focused on next. But it also helps me keep my job sites clear. It keeps agents and homeowners for feeling like they need to go over and babysit a project which they don't, because you've brought us on. But some people are nervous, but I find once you get through that and you start going through those and they can physically see the work happening, they relax and they're like well, I don't have to drive two hours to check on that, because I just saw the photos, or whatever else.

Declan Spring: 1:02:51

Yeah, you feel like you're just in, in good hands. That's the hope you know that's how it feels to me whenever I work with you Is a free model in every market. I mean, are we all over the country of agents who listen to this and they want to reach out to free model?

Lara Richmond: 1:03:07

Free model is all over California.

Declan Spring: 1:03:09

Okay.

Lara Richmond: 1:03:10

And we are in Texas and Florida. Wow, okay, and we are in.

Declan Spring: 1:03:12

Texas and Florida.

Lara Richmond: 1:03:12

Wow, okay, and I can tell you from having some like project director meetings I had. Some of this stuff does not translate the way it does in the Bay Area, like when you're living here you think this is how we do real estate.

Declan Spring: 1:03:22

Yeah.

Lara Richmond: 1:03:23

And then somebody in Houston. She had been a stager and then came on with Fremont as a project director.

Declan Spring: 1:03:28

Yeah.

Lara Richmond: 1:03:33

But she does some of the staging for her clients and she. She said that you know it was really hard to convince them to spend that two thousand dollars on staging yeah but it's important people can't see the face you just made of two thousand dollars, who only pays that for staging, which is the face like everybody in california was like I'm sorry, what, where we're you know seven, ten yeah, on the size of the house, sure. Right.

Lara Richmond: 1:03:54

Places where they spend nothing in pieces are like $2,000 on staging. But I convinced her it was important to bring some new pieces. Wow, so they're still using the majority of the homeowner's stuff. But they're bringing, like you know, the new white sofa and clearing some things out and everybody here is like, oh, that's not really a staging budget.

Declan Spring: 1:04:10

But so hearing the difference in the markets is interesting you know now that you're talking about staging, though it does allow me to highlight something else that I really, really appreciate about free model, which is that, um, you'll do everything, but uh, but you don't. You don't insist on doing everything, like, for example, the project that we're working on right now. I told the homeowners, yeah, we could have free model do everything, including the staging. But I sat down with them I said we're using free model? Why? Well, because you just don't have a huge budget, but you have plenty of equity, so free model is a good fit. But you do have a little bit of money, have plenty of equity, so free model is a good fit, but you do have a little bit of money.

Declan Spring: 1:04:53

And they said, yeah, we do. I said, well, how much do you have? We looked at how much is available and I said, well, look, you have enough money to pay out of pocket for staging. There is a markup with free model a little bit, and so it would make more sense, in my opinion, if you just pay out of pocket for the staging. That way, you save a little bit of money and we're using free model correctly, and free model is okay with that, they don't mind.

Lara Richmond: 1:05:18

They don't at all. And I have agents who want us to do everything through, you know, cleaning and windows, landscaping and staging. I have other people who really just want us to do the main construction.

Lara Richmond: 1:05:29

And then they have cleaners, landscapers and stagers of their own. Some people, you know everything except staging or everything except window, and I don't mind that because that's all at the end, right. I don't want five subs that I don't know on the project while we're working and Fremont does get particular about that. When we're owning that job site, that's our license and our insurance and our workers' comp, and I don that when we're owning that job site, that's our license and our insurance and our workers comp, and I don't know who these other people are and we. They can break something and then is it my responsibility. So I run a fairly tight job site.

Lara Richmond: 1:05:59

Yes, during the construction phase got it but once we're sort of you know the construction's done and now it's cleaning and windows and some landscaping and other things, yeah, they could be my subs. I'm happy to run that for you. If you have people that you use all the time and you love your landscaper, the way he puts things together and he's got a vision for this great, use him and we'll walk off when we're done with the things you need us to do.

Declan Spring: 1:06:21

Yeah, and I really like that. It's fair, it allows us it is fair. It allows us to have a really proper conversation with our clients about well, you know, free model has a markup for this thing that maybe you don't need to pay the markup because it's just staging and it's not the construction. So, let's, let's save a little money there.

Lara Richmond: 1:06:39

Yeah, and if you save that markup you can get a better stager or you have more. You know you can do more spaces outside, depending on the home or whatever it is.

Declan Spring: 1:06:48

Or you could just save a little money.

Lara Richmond: 1:06:49

Or you could save a little money, but it allows you to have more choices. Yeah, yeah, you know as you walk into staging, because I know some people are like, well, we can do two outside areas, where should we do them? Yeah, and where people are making those sorts of choices, that's right, you know. Or maybe we'll do two bedrooms, and I had somebody once, you know, not do all the bedrooms, it was a lower market property. And they're like let's just show them what a bedroom would look like.

Lara Richmond: 1:07:11

But maybe we won't do everything everywhere just because it was, it was in South Oakland and it wasn't a lot of money and I think some of the expectations were a little different there, and the agent and the homeowner were like, we, this is how much we have for staging. And I'm like, okay, if you could afford it not with me, so that you can do more in the house and then you, you can do more in the house, yeah, and then you know.

Declan Spring: 1:07:30

Yeah, very fair, yeah, very fair. That's just a lot of goodwill Again. It gets back to being a good neighbor and all that stuff. You know there's goodwill.

Lara Richmond: 1:07:38

Well, and we want to be partners with our agents.

Declan Spring: 1:07:40

Yeah.

Lara Richmond: 1:07:40

Right, like we don't want to come in and take over and we're not Nazis. Like we're not coming in and we're not jerks about it. We want to work with everybody, but the smoothest projects are the ones where we control the site during heavy construction.

Declan Spring: 1:07:54

There you go.

Lara Richmond: 1:07:55

And when people have a little say, you know, in design or whatever, on the front end, before we're started.

Declan Spring: 1:08:00

Yeah.

Lara Richmond: 1:08:00

And then you just let us run. Yeah, the more interjections you get in the middle, it's confusing. There are mistakes or misinterpretation.

Declan Spring: 1:08:16

You're going to add time, you're going to add other things and you end up with the worst outcome. Yeah, and so I. If people do want to say I want to do it up front, well, I can't thank you enough for your, your time today. I mean, I've taken up plenty of it, so I'm going to, I'm going to let you go. I'm sure you have places to be. Let's go through. I'll have everything in the show notes. But people want to reach out to Free Model. I think it's just freemodelcom. It is Right, so you can go to freemodelcom. Now, if people want to reach you directly, because perhaps they're not interested, maybe they just want some design help, okay, what's a good way to reach you?

Lara Richmond: 1:08:47

It's my first name, Laura, and I'm at agaveinteriordesigncom.

Declan Spring: 1:08:51

Oh, so agaveinteriordesigncom. It's its own website, mm-hmm.

Lara Richmond: 1:08:54

It is. You can reach me there.

Declan Spring: 1:08:56

I'm going to put that in the show notes as well. So now people can either look into Free Model or they can look you up directly just by checking the show notes. Yep, absolutely. I'm a big fan. I'm a believer. Lever, Laura Richmond, it's been absolutely lovely to have you. I wish you best of luck with all the projects in action and look forward to hearing about the success stories down the road.

Lara Richmond: 1:09:16

Thank you so much for having me. I really appreciate being invited on.

Declan Spring: 1:09:27

This episode was edited by me, with original music by Chuck Lindo and graphics by Lisa Mazur. The podcast is brought to you by the Home Factor Realtors thehomefactorcom. Catch up on the latest news from the East Bay Market in their weekly blog, published every Saturday at thehomefactorcom. If you'd like to reach out to me with suggestions for the show, that kind of thing, please text me. It's that simple 415-446-8591. That's 415-446-8591. We'll catch you on the next episode. Thanks, everybody.