Friday, April 20, 2012

Local Home Prices Are Just a Starting Point!

When it comes time to put their home on the market, the Number One topic area sellers focus on is local home prices:  home prices historically, home prices this April, projected home prices in the future. What many sellers don’t truly realize is that they have more control over the price their home fetches than they may think.   

Smart application of remodeling dollars to maximize a property’s salability is the earliest and most important action a homeowner can take. If you plan to remain in your home for the foreseeable future, lifestyle and personal preference issues will rightly get your attention. But if a move is on your planning horizon, remodeling decisions should be hard-eyed business decisions. In my experience, there are three rooms that buyers are particularly interested in – and homeowners bent on raising their own local home prices should share that interest!  

Kitchens can drastically raise or lower home prices.  Since kitchens have evolved into the major social hubs of American homes, increasing its size can be superbly cost-effective. If there is a possibility of and opening it up to living space by knocking down a non load-bearing wall, it is well worth considering. Upgrading appliances to stainless steel, replacing countertops with granite or other stone, and refinishing kitchen cabinets can absolutely give some much-needed appeal to an outdated kitchen. Just switching out old hardware for contemporary substitutes can add appreciably to a kitchen’s appeal. 

Families spend much of their time in their living rooms – and even if they don’t, psychologically, it can seem the center of family activity. A cramped, cluttered and dark space will detract from other more attractive features of a home. A living room can be made into a bright and welcoming space by making inexpensive changes, such as removing all but essential furniture, painting walls a neutral color, and removing drab window coverings to let in as much light as possible. Replacing worn carpet with a wood laminate -- or refinishing long-covered wooden floors -- can take a bit more elbow grease and budget, but can be worth the cost. 

In the master bedroom, homebuyers want to visualize a sanctuary where they can escape from the trials of their busy lives. Simple but effective changes can make all the difference. Remove large pieces of furniture (particularly desks and computers)…in other words, aggressively de-clutter.  Find pale, tranquil and soothing colors for the walls, and choose simple bed linens in complimentary colors (think “hotel luxury”). Make sure that clothes are not on show and that closet spaces are tidy, even if it means putting some of your apparel into storage. 

The goal is always to make changes that allow buyers to see the potential in a home; it’s how individual local home prices can rise above general market trends.  If you’re considering selling a property and would like to discuss home prices in our area and ways to maximize values, give me a call today so we can schedule a free consultation! 

Thursday, April 19, 2012

Step-by-Step Outline for Selling a Local Home

All of life’s major projects take preparation, and selling a home in our area requires just that.  Contacting my office is a pretty good place to begin, because selling a home efficiently and within a reasonable amount of time most often takes extensive knowledge of the local market. A checklist is a good way to introduce the steps you can take to prepare for selling a home. Here’s a quick overview of five of the items I include in that checklist:

1. The obvious first step is identifying any major problems and determining what should be done about them. Decide whether you are going to fix items like roof leaks, rewiring, insect infestations or the presence of asbestos -- or whether you are going to reduce your asking price to reflect any unremediated issues.  I can provide input to help you establish where possible value may be added or lost, and what is worth your time and investment to fix. 

2. Whenever you return home, take a moment to pause and visualize what someone driving by for the first time will see. Make a solid first impression by tidying the front yard and keeping the lawn neatly cut and edged. Strategically place colorful flowers in planters where that is appropriate. Repair fences and gates, and be certain that they look freshly painted. And if Fido has the run of the place, be sure that his (ahem!) evidence is nowhere to be seen. 

3. Stage your home to maximize its appeal – and keep in mind that staging needs to be fresh for every prospect. Remove any unnecessary furniture. That may well mean renting a storage unit to place it and all other clutter into (it’s bound to be a better solution than trying to jam everything into closets or the garage!). Paint walls in light, neutral colors. Remove heavy window treatments to let in as much light as you can (the ‘cheeriness factor’). Keep the kitchen and bathroom as spotless as possible. Make sure that your home smells fresh by opening windows and using flowers, candles or air fresheners; but be careful not to overdo it.   I can be especially helpful at this stage, and if it’s indicated, we can discuss whether it makes sense to hire a professional stager. 

4. Have the property's value appraised, and educate yourself about the competition. For a bank to issue a loan, your home must compare favorably with similar properties on the market. When we sit down to establish a list price, we’ll need to keep that research and the recent and best comparables in mind.   

5. This is my favorite to-do item: Be prepared to go!  If a move is going to be in your future, you should begin the hunt for a new home, and be prepared to move quickly once you have an executed offer!  

These are just a few of the steps I help my clients take before listing to get top dollar for their properties.  If you are considering selling a home in town, call me today to see how I can put my marketing experience to work for you.

Wednesday, April 18, 2012

Tax Time is Time to Check Rent/Own Math

Tenant or Owner? With rental rates rising, a lot more tenants in our area are likely to be wondering whether they should be taking a new look at their residence situation.  

Conceptually, paying your own mortgage has always seemed more appealing than paying a landlord’s mortgage every month.   Especially this time of year, when tax time puts the whole year’s finances out there on one piece of paper, seeing how thousands of dollars have slipped away for another year can be a little frustrating.  Not surprisingly, then, this is a time of year when, as a buyer’s agent, I begin hear the phone ring a little more often! 

Seen from the long term perspective, dollars put toward a home you are buying go toward building a future -- something rent dollars cannot do. But there are more intangible benefits to owning versus renting: control over the title being potentially the most valuable.  Any tenant who has been forced to move because the homeowner needed to sell, or was foreclosed upon, or decided to move back in himself, is someone who has learned the value of controlling when their next family move should happen. 

For tenants newly considering becoming a first-time homeowner, consulting a reputable local buyer’s agent is the place to start. An experienced buyer’s agent can help you determine a practical budget, and then guide the pre-qualifying process to make it happen.   

The next step will be to identify properties that fall within your budget.  Are there neighborhoods you have always wanted to live in, but thought you couldn’t afford?  In today’s market, just about every neighborhood – even the most chichi ones – have experienced some foreclosures.  A buyer’s agent can help you identify potential homes at bargain prices.  Some might need a little work, but the long-range payoff can be worth it.   

The bottom line? Everyone has to pay to live somewhere, and in today’s market, owning a home in our area is more attainable than ever.  With mortgage rates still at near-historic lows, if you are on the verge of becoming a former renter, now is the time to consult a reputable local buyer’s agent.  I am always available for questions -- and would be happy to schedule a pre-qualification consultation anytime you decide it is worth exploring.

Tuesday, April 17, 2012

New Activity Promises Uptick for Local Market

Buying homes and renting them are such distinctly separate aspects of our town’s real estate scene that we tend to pay attention only to the sector we are most involved with.  We pretty much ignore the other. Renters and real estate investors watch trends in residential rentals, while homeowners and soon-to-be homeowners check on prices and activity in the local home market.  

All of which means that it’s easy to overlook how trends in one sector have major impacts on the other. And any sort of residential construction activity – new building or remodeling – has a direct and positive impact on our economy as a whole.   

So here’s some good news: this year, rental construction is expected to reach its highest level since 2005. Somehow that may not seem like such a big deal, but despite the way it looks, 2005 is SEVEN years ago (time flies, doesn’t it?)! Those have been seven painful years for most of the construction folks we know, so the change comes as welcome news. It’s also possible that a turnaround could mean that other turnarounds in different areas of the economy may be in the wind. 

The apartment experts at NMHC just published something that most of us already suspected. They found that nationally, apartment vacancy rates fell to a decade low of 4.9%. We have already written about how asking rents continue to rise (in March, up .5% from the previous month). The same experts noted that some empty-nesters seem to be increasingly likely to opt for the convenience of apartment living -- even those who could easily afford to buy.  

It explains why more investors are stepping up to order the building of new rental homes even as many older apartments and rental homes are being renovated.  Add to that recent government moves to encourage lenders to become at least temporary landlords, and the result is real activity. Budgets have been tight for families in recent years, which may have caused them to decide to choose rental homes that were older, hence less expensive. If the economy continues to strengthen, these same families may later be able to afford to look at one of the new rental homes now under construction. It’s likely that many tenants would choose to live in a place that is a product of new construction, or in a complex that has been recently renovated.

All that increased building activity is another sign that the housing market as a whole is waking up. In the longer range, since newer rentals generally cost more money, more would-be tenants will ultimately reconsider the prospect of owning a home – in turn increasing demand for first-time or entry level homes. 

Wherever your family falls in the local real estate mix, don’t hesitate to call our office when you have a question about the market and what is available for you. We’re standing by!

Friday, April 13, 2012

Banks with a Heart? - Homeowners Become Tenants

A few weeks ago, Bank of America initiated a pilot program allowing homeowners facing foreclosure to remain in their homes as renters.   There are important reasons why area homeowners should be interested in the success or failure of BoA’s approach. 

First, a note about the term “bank owned homes”. It’s not technically correct to say that there has been some huge rise in the number of them, because “bank owned homes” actually describes every home with a mortgage. The mortgage holder always technically "owns" the property, even when the homeowner retains title. However, what is true is that over the last four years, many homeowners learned the hard way just what it means to face the reality of your home being owned by someone else.    

Enter Bank of America. Their press release quotes Ron Sturzenegger, a Legacy Asset Servicing executive with the Bank: "Our priority is designing a solution that helps our customer." Although we might be justifiably skeptical of this as BoA’s sole motive, allowing homeowners to remain as renters in bank owned homes is hardly just a PR move.  

The program certainly makes bottom-line financial sense for a whole host of parties, including local homeowners who have no difficulty meeting their own mortgage payments.  

Under the program, a former homeowner who qualified would be able to continue working and contributing to the economy without the costs, loss of time, and anxiety involved in moving. For all property owners, the ultimate effect is to keep the market from being flooded with distress sales. Every neighborhood would benefit if home values stabilize.  

Under the pilot model, bank owned homes convert to investor ownership in a much smoother transition than the foreclosure/short sale model. Instead of the lender being left with an empty property generating zero revenue in the interim, former homeowners simply become renters, making it easier for them to get back on their feet financially. 

In my opinion, any move or policy that helps more people stay in homes is a policy worth discussing.  BoA’s program is only in a limited test stage, but here in town we can hope that it will prove to have multiple beneficiaries: banks, investors, agents, homeowners and neighbors. Everyone benefits when his or her neighborhood’s real estate market is healthy!  

Have a question about real estate in our area?  Feel free to contact me anytime with questions. I represent local buyers and sellers, and am always available to chat about your own plans.

Thursday, April 12, 2012

Your Local Home Deserves a Hero Shot!

As a whole, we Americans are an interesting group.  We are smart, educated, involved in our community…and, not unlike the rest of America, our attention span about 5 or 10 seconds.  It follows that when you put your home on the market and your agent places it among the local realty listings, your home has about that long to grab potential buyers’ attention.   

Time and time again, studies show that realty listings with superior curb appeal get markedly more attention than those with run-of-the-mill photos.  First impressions count. It’s how advertising agencies can charge hundreds of thousands of dollars to get just the right angle with just the right lighting on their perfectly-designed product packages. In ad-speak, that photo with the perfect angle and lighting is called the ‘hero shot’.   

Your home can have its own ‘hero shot’. Its landscaping, color, the condition of its driveway, walkway, garage and backyard, along with the overall neatness combine to make a true ‘hero shot’ that will stand out from the other area realty listings. That same look (over and above the one in the photographer’s viewfinder) can also be counted upon to draw the attention of potential buyers who happen to be just driving by. 

It’s not surprising, either, that curb appeal also affects the value and salability of realty listings. A study by the University of Washington found that "mature trees in a well-landscaped yard can increase the value of a house by 7% - 19%.” On the other hand, overgrown trees that obscure the view of the home can delay its sale. 

The curb appeal of homes almost defines a neighborhood’s appeal, and vice versa. Any home that is well kept improves the image of the rest of the houses on any street. In the same way, a home with a neglected look can bring down the general appeal of the entire neighborhood. You already know what it’s like to drive by a street lined with houses that are all beautifully maintained. Now that’s the kind of place where you would definitely want to live! 

If you are giving serious consideration to selling your local home, call me anytime for a “curb appeal” consultation.  Usually, just a few easy steps are all it takes to improve that vital first impression!

Wednesday, April 11, 2012

Property Listings: Springing into Action

With spring in the air, notions of fresh starts and new horizons have a way of pushing into just about everybody’s consciousness. It’s only natural, whether because of the weather, school schedules, or everything else around us that seems fresh and new. And something else is in the air, too: if past history is any guide, now is also simply the most popular time of year to sell or buy area property. 

For those with a home to sell, this is traditionally the most active time to be in the real estate market. Homes entered in local property listings during springtime can be expected to attract buyers more quickly, and they stand a better chance of fetching a good price. With 60% of moves in America taking place during the summer months (most likely a reflection of the school year schedule), it stands to reason that spring is a great time to get your local property onto the market.  

 For potential homebuyers expecting to shop for a new home sometime this year, there is ample reason to swing into action sooner rather than later. Local property listings can be expected to conform to the national trend: at a rapidly rising rate, Realtors® expect constant or higher residential prices in the coming year (73% vs. 62% just three months ago, according to the NAR). Following the past few years of price declines, it won’t be surprising if the market’s recovery brings a rapid rise in prices. Then the bargains people have begun to take for granted could quickly become tomorrow’s regretful “I could have bought that house for only $---” stories…that happens again and again. Those who know they are going to be in the market this year should seriously consider getting in the market! 

For both buyers and sellers, spring is the most popular season for a number of reasons. Especially for families with kids in school, or anyone whose business is geared to encourage summer vacations, it’s also the most sensible time to act. Whether you will be adding your own contribution to our area’s property listings, or beginning to comb those property listings to zero in on a new home, do get in touch with me to help make this spring the one that makes 2012 your Year of the Big Move!

Tuesday, April 10, 2012

Investment & Vacation Home Markets Waking Up!

The investment- and vacation-home markets have been among the first to show signs of real estate resurgence, according to the people who keep track of such things (as usual, the National Association of Realtors® is one). It might seem unlikely, given the general view that the housing sector continues to post mixed signs of recovery. But when you think about it, there are reasons why it could make perfect sense. A few that come to mind: 

* The price is right. If the overall real estate market is in fact in the process of rebounding, it’s still so early that no one can be certain it will be strong -- or even that it will continue. You couldn’t describe a more appealing situation for small investors who have been biding their time, waiting for the right bargain to pounce upon. Investment home prices rose 6.4% last year (of course, because rents were rising), yet the median vacation-home price was down over 19%! Talk about vacation bargains! All of a sudden, the daydream of affordable beach houses for sale seems to have become a reality. 

* The market is open. Right now, there are also strong inventories of vacation and beach houses for sale – many of them located in attractive settings. Many of those settings also happen to be the very places were the real estate market is still digging out from under the foreclosure mess. This makes it easy for people to find vacation- or investment-home opportunities that previously would have been out of their price range.  

* Interest rates are low. Low interest rates make a second mortgage even more affordable for those seeking a luxury vacation home.  Today's interest rates signal savings throughout the term of the loan, which is even more appealing for those seeking a second home. Combined with the sheer volume of beach houses for sale, this makes it the ideal time to purchase a dream vacation or retirement home.

*Optimism on the rise. When the wolf is at the door, few of us are tempted to make luxury purchases. And for years, it seemed like the only news about the economy was bad. But declining unemployment numbers, soaring stock markets, and the resulting good news for retirement accounts can change attitudes…the same attitudes that underlie investment decisions of every kind.  

A second home can be a vehicle to generate investment income. Or it might be the fulfillment of a long-held dream. For those fortunate enough to have put aside some disposable cash, today any one of those mountain or beach houses for sale could wind up representing both! 

Friday, April 6, 2012

Moving ‘Moving’ From Nightmare to Dream

Remember when moving was fun?

If you share the sentiments of just about everyone in town, your answer to that is a definite “NO!” Picking up and moving a household has never been fun or easy -- and long distance moving can be even worse. When you need to relocate from another state to this state, you can’t just hop back across town to take care of a few last minute details: likely as not, you’re a jet plane ride away!

The logistical concerns of moving your belongings, coupled with the expenses and the stress of locating a new home, can combine to be close to overwhelming. Thankfully, there are specialists to help with the situation. With focused training and years of experience, relocation specialists help save time and money (not to mention mental stability). With assistance from a relocation expert, you can move ‘moving’ out of its traditional nightmare category. 
When a local agent lists ‘Relocation’ among their qualifications, it means more than just first-hand knowledge of the area’s schools, shopping, commute times and home values. While people tend to be more or less familiar with the real estate market in their current neighborhood, it’s challenging to get up to speed with an unfamiliar real estate market. Agents qualified in relocation are particularly aware of the need to familiarize their clients with local values -- especially since they often have a small window of time in which to secure their new home.

For anyone planning relocation to our area, there are a few steps you can take to find the right agent for you. First, put all potential agents through a telephone test. Call several agents during the day and leave a brief message, stating your needs. Then sit back and wait for return calls. Avoid any agent who doesn’t call back within 24 hours. Relocating to a new area is stressful enough without having a real estate agent you cannot rely on.

Next, ask the remaining candidates a lot of questions. Find out how much experience he or she has in relocating clients to this area. Determine how much the agent knows about the neighborhoods that fit your baseline criteria – have they successfully relocated clients there? Finally, ask for references – the names and phone numbers of past relocation clients. And don’t skip calling those references! The most reliable referral is one obtained from someone who can report from experience.
For a long distance or logistically complicated move – the kind that happens when you need to simultaneously sell one home and buy another – being able to rely on an agent who lists ‘relocation’ as a specialty may be the key to success. If you are considering a move to our town, give me a call anytime to discuss your timeline and needs.

Thursday, April 5, 2012

It’s 9 O’Clock: Do You Know Where Your Listing Is?

In an age where technology is king, the concept of free and widespread listing syndication at first sounded promising to agents and consumers alike.Listing Syndication” is the term used when third parties – including big Internet outfits like Zillow and Trulia -- take local real estate agents’ listings and put them up on their humongous national websites. 

Most local real estate agents thought to themselves ‘Great! – now everyone in the country can see my clients’ home listing; we will get the word out nationally.’ And they were right about that, up to a point. But now some serious scrapping has broken out, and the details are something I think readers will find useful to think about. They affect what happens whenever you look for a local real estate property, or put your own up for sale.  

For area house-hunters, the biggest issue with syndicators is information that is either out of date or inaccurate. To any would-be homebuyer, sites like Zillow or Trulia hit them first: they’re always smack dab at the top of the Google or Bing pages when you look on the web. What isn’t apparent is that such websites don’t always offer all of the homes or data that might be available through a local real estate agent.  

Rather than using feeds that offer each viewer the freshest information possible, syndicators lead those searching for a new home through a dizzy trail of listings. Moreover, if you have ever used them, you probably know that some of those have usually expired. In addition, syndicators are real search engine hogs; local real estate agents have to battle against their Google-engineered pages to get a top spot. As a result, house-hunters may be unable to find what the very local housing market and its most active agents have to offer. 

As well as failing to deliver accuracy to consumers, syndicators may lead consumers in the wrong direction when they do find a house that interests them. If a listing agent is not willing to pay Zillow a monthly fee for the privilege of having listings accurately placed at the top of the search results, a consumer may find a different agent's contact information displayed. It’s easy to see why some agents are fuming about this, but more importantly, it may do damage to the client’s experience. Just because an agent is at the top of a search result does not mean that he or she can answer important questions a buyer may have about that listing.  

Finally, it is not uncommon for consumers to experience confusion when it comes to listing prices. Syndication has in the past led to inaccurate information about prices to be published online, even duplicates with different prices. Yikes.   

However, those slowly evolving issues don’t totally cancel the early promise of wide syndication. Personally, I love the wealth of information syndication provides consumers.  Technology and free access to information are boons to us all.  However, when it comes to buying a house in our area, sometimes there’s no replacement for the human touch.  Call me anytime for the personal service only a local real estate agent can give you!

Wednesday, April 4, 2012

April Showers Bring May Sales

Once you decide that the time has come to sell your house, the area’s open houses are one of the most promising ways for you to show off its fine points. And early spring has long proved to be one of real estate’s peak selling seasons. Despite the fact that April can bring unpredictable weather to town, it’s undeniably prime time to use an open house to market your home.
Open houses are popular for the simple reason that they provide maximum exposure to house-hunters, whether they are casual or more highly motivated. Particularly when a home is occupied, open houses invite easy access to a property, side-stepping all the normal hurdles of appointment making, phone tag, calendar syncing, etc.  Since vacant homes are easy to show any time, they tend to get more exposure (especially since prospective buyers frequently phone at the last minute to request a tour).
Open houses are a way to even the competition. Held on a Saturday or Sunday afternoon, they provide the easiest way for potential buyers to browse. Prospects can casually pursue their search without having to commit to a day full of appointments. For them and for the seller, it’s a handy tradition.
But what if it turns out to be one of those local rainy days?
Ideally, everyone plans their open houses with a bright, sunny day in mind. But when the clouds gather, you don’t need to let a little inclement weather wreck the opportunity.  When it turns gloomy outside, think of it as the perfect opportunity to make your home shine on the inside.  Open all the blinds, turn on the lights, throw some upbeat jazz on the stereo, and crank the heat up!  Another nice touch (especially if you want to come home to a clean house) will be to place towels or mats by the front door so that attendees can wipe their feet.
Looking to go the extra mile?  Provide hot chocolate or hot tea in disposable cups for your agent to offer browsers.  At the very least, they’ll be sure to remember your open house!
If you are considering listing your area home and are looking for solid marketing support and exposure, today is the day to call me to schedule your consultation…rain or shine!  

Monday, April 2, 2012

Mortgage Rates Are Rising! Or Are They Falling?

When mortgage rates began to rise in January, it caught the attention of a lot of future local homebuyers. If they had been enticed by the record-breaking low mortgage rates that had been headline news for so long, many of them began to reconsider their leisurely home-hunting pace.  Now we have an interesting turnaround: last Tuesday, the FHFA reported yet another reversal. They say that rates fell again: either nine or ten basis points, or --depending on how it’s reported-- five.

It may seem a little difficult to sort that one out.  The difference between five basis points and ten basis points is, after all, 100%. But mortgage rate reporting can be like that. As the FHFA (it’s the outfit that regulates Fannie Mae) points out in the fine print, interest rates are typically determined 30 to 45 days before a loan is closed. So even when you have last week’s report in hand, the apparent trend might be misleading. Even if it were clear what the exact size of the rate dip was -- and it isn’t. 

All this is an indicator of a basic residential real estate truism: in addition to using a great local real estate agent, today’s house-hunter will be well served to enlist the help of a great local mortgage broker, too. Your local mortgage broker will be on top of what area lenders are doing, what they are looking for, and what the latest timing realities are. Your mortgage broker will paint a clear picture of what to expect based on your individual financial picture, and will work with you to shape a loan package that works for you, the seller, and the lender alike.   

It’s worth noting that mortgage brokers are no longer allowed to pay referral fees to any Realtor. That tends to work in your favor, since it solidifies the fact that at the end of the day it's solely by doing a great job for you that a local mortgage broker stands to earn repeat business.

If you are considering buying a local home, please don’t hesitate to call me for a complimentary buyer’s consultation.   If you like, I can introduce you to a great mortgage broker, and you can decide if now is the time to make your new home a reality!

Friday, March 30, 2012

Local Investors: New Rental Homes Index is a website that is often cited for its index of home values across the nation – but its surveys and data are interesting to local real estate observers, too.  Recently it launched a new rental homes index that seeks to measure rental rates throughout the country. The index weighs rental listing prices as well as tax data and homes' sale histories. 

The index has some value to prospective area tenants and landlords as well. Ultimately it might help identify local market trends (but their data only extends back to November 2010, so more time will be needed for its usefulness to be proven). It might, though, serve as a tool for comparing markets. For example, the index showed year-over-year median rent increases in nearly 70 percent of metro markets from January 2010 to January 2011, and it reports that rents have appreciated 3% during the same period. 

Of course we all know that decisions based on data are only as good as the data itself. Unfortunately, Zillow's track record for accuracy in its market value numbers (it calls them "Zestimates"!) is less than stellar. Although these estimates of value are thought to come within 15% of true market values more than three-quarters of the time in some metropolitan markets, if you are interested in rental homes in that other quarter, you might be misled. And in many small markets, it misses the mark entirely. In some markets, the estimates are so far off base that Zillow doesn't even attempt to quantify their accuracy. 

The other disadvantage to relying on an algorithmic index like Zillow's is that algorithms can't replace the local market knowledge that is any real estate professional’s stock in trade. The data we collect and analyze on area rental homes comes from our own knowledge…and what is more important, is put it into a context that allows local tenants and landlords alike to use the information to make sound decisions.  

If you are considering buying an income property, you need to know the most recent and accurate information for the local rental homes market – so I hope you won’t hesitate to call me for a consultation. 

Thursday, March 29, 2012

Selling Your Home to a Relocation Buyer

Anyone moving to our town from out of the area is experiencing life near the top of the stress meter. Most homeowners who have listed their property are sensitive to their plight: after all, once they have sold their home, won’t they be facing the same situation? 

Relocation planning has also grown more complicated over the past few years. For many prospective buyers, a slow economy and slumping housing market have narrowed their options. According to, relocating individuals cite the depressed housing market as their Number One concern. They may be facing a difficult market as they sell their previous home, and may also have career jitters connected with their new working venue.  

Local home sellers can increase their chances of a successful sale by specifically targeting the relocation market. The can offer a “move-in-ready” home: one that is prepped and ready to show any time the opportunity presents itself. 

Whipping your home into shape before you show it invites the relocation-minded buyer to imagine himself or herself moved in and ready to go to work. Once they see that hour home is in excellent condition, it will go a long way toward removing one important layer of worry -- fear of the kind of unknown maintenance expenses that would only become evident after moving in. Remember that unsolved ‘minor’ mechanical problems can seem ‘major’ to a prospect. Your goal is to make it easy for any potential local relocation candidate to imagine an easy transition, a fast settling-in time and a worry-free living environment.  

You can also reach more relocation buyers by making your property easy to show. Relocation prospects who have to travel for area showings usually need to cram in as many as possible. The schedule is usually tight, especially when they add showing requests at the last minute. When your home is one that a relocation candidate has asked to squeeze in, resist the temptation to regard their request as inconsiderate. It’s a real opportunity to create an excellent impression of your home once they see how great it looks even though you had little time to prepare.    

If you are considering selling your local home and would like to discuss listing, please don't hesitate to contact me directly to discuss strategy.  On the other hand, if you are planning your own local relocation, I have great listings and a buyer's packet waiting for you!

Wednesday, March 28, 2012

Just How Valuable are “Property Values”?

It’s a little bit like real estate’s Rite of Spring: ‘for sale’ signs sprouting on lawns like new flowers finding the area’s April sun. And since we are used to hearing how “property values” are still battling to rebound, this season the ‘Sale’ part of those signs is likely to be taken more literally than usual.  

But since “property values” seems to be such an important measure, what is really behind the term? Who determines our area’s “property values” – and how? 

We aren’t just talking about some abstract Econ 101 textbook definition of economic principals. We are dealing with a family’s major investment – their current or future home. So it’s valuable to make a mental distinction between that notion of ‘property value’ and other, less abstract terms. Like “price”.  

In a nutshell, “property value” can mean different things to different people -- and even different things to the same person! To a homeowner, for instance, it can be the amount of money he or she can sell it for (its “market value”), or the value it has if he or she don’t sell but continue to use it as a place to live (its “use value”). To a lender, it usually means current market value; to a pure investor, property value might be its future value or its liquidation value, -- which would also vary depending on whether they are thinking of some possible future forced liquidation or an orderly liquidation. In other words, “property value” is a term that can mean so many different things that it is not terribly useful. 

So the next time you hear a commentator talking about “rising property values” or “sinking property values,” be ready to take what they are saying with a grain of salt…or possibly a shaker-full. Property values are not anything like “price”, “asking price,” or “selling price.” Those terms can have real numbers attached!  

In case you have been thinking about buying or selling a local property, give me a call.

I’m here at the office -- and the market’s ready!

Tuesday, March 27, 2012

To Buy a Home or Rent: That is the Question

It’s a fact that many folks in our neighborhood decide not to buy a home. Aiming to save some cash, they rent instead. They may feel that it makes more sense to work on rebuilding their portfolios, put some extra cash into a rainy day fund, save for retirement, or for college -- for any number of worthy goals.
These would all be prudent financial maneuvers, but only if the original assumption is correct. But today’s environment is creating a new reality. It’s one where renting may not be as much of a cost saver as most people think. 
Since it is my profession to deal in real estate, you might think my answer to the question of whether to rent or to buy a home would be an automatic ‘buy!’ Not so. While I certainly do want to help arrange a sale whenever a local buyer and seller can agree on terms, I also want all my clients to make the financial decision that is right for them and their family.  And as we enter the April selling season in our town, I’m pleased to be able to report on a piece of information that may be surprising. It’s one that comes from the latest Trulia Spring 2012 Rent versus Buy index.
This index is a widely watched calculation derived from data in the 100 major metro markets. A Price-to-Rent ratio of 15 or less means that any buyer who plans on living in his home for at least five years would be better off to buy a home than to rent it.
Bottom line: 98% of those 100 areas currently offer a cheaper environment in which to buy a home than to rent it! To make sense of the numbers, looked at the asking price of national rentals and homes for sale. It also included insurance, taxes and maintenance costs in the calculation. With low interest rates making the monthly mortgage cost lower, and high rental rates bringing the rental rate higher, many would-be renters might now find themselves looking at a surprising new reality -- affordable homeownership.
If you are currently considering renting or buying a home in our area, why not sit down with me in our office to run a few numbers first?  I am happy to schedule time to discuss your needs before you sign a lease.  Today it is entirely possible that for you, owning a home will just be cheaper than you think!

Thursday, March 22, 2012

Home Automation: The Next Big Thing?

Advanced technology has become such a prominent feature in our everyday lives it is no surprise that it’s increasingly affecting local home values. As “Home Automation” features grow in importance, bottom-line home values are following suit. It’s a new phenomenon, one that motivated home sellers (as well as homeowners heeding long term home values) should understand. 

Home automation – the inclusion of luxury technological features like temperature control, lighting control, security systems and the like – are becoming more commonplace, increasing home values in the process. A few years ago, adding such bells and whistles to an existing home would probably have been more pricey than the return would justify -- but that is becoming ever less true. Think hi def flat screen TV and you’ll have a good example of the direction home automation is headed: ever-improving features for lower and lower prices. 

As automated features become more widespread and their prices lower, some of them are growing increasingly simple to add. And the scope of home systems and their effect on home values can be quite varied. For some, adding an ‘automation system’ might consist of something as simple as installing remote or automatic control of a few lights. Others might make electronic security the key, choosing to install a full-fledged central system.  

Where wireless home Internet networks are already in place, home values can easily be raised by the addition of remote operation. Right now that may sound like an unnecessary futuristic feature, but it may turn out that being able to control lights or heating systems from afar could substantially increase energy efficiency (along with home values).  

Matthew Berman, one of the owners of New York design firm Workshop/apd, was recently quoted in the New York Times describing a “whole-home” lighting system.

“A popular feature of this kind of system is the ability to hit one button when you're leaving your house to turn off all the lights." As a practical matter, he also recommended keeping automated systems separately controllable, making them less complicated to operate and less subject to breakdown. 

It's important to think long-term as well as short-term -- especially for anyone looking to increase home values, whether for future or immediate sale. Home automation is looking like a worthy candidate for the Next Big Thing, and buyers might be ready to gravitate toward advanced features that distinguish one local seller's home from the competition.  Call me if you would like to discuss how home automation might come into play when it comes to selling your area home.

Wednesday, March 21, 2012

More Bank-Owned Homes Headed Our Way?

With the National Mortgage Settlement (aka ‘Robo-Settlement’) finally negotiated, major lenders are now able to re-examine their plans for dealing with the backlog of bank-owned homes. Local bank-owned homes may be only a tiny portion of the almost 1 million in play nationally, but are nonetheless subject to the wider phenomenon. Banks well realize that at some point, these homes have to enter the housing market. 

That development is a large part of why some analysts believe that for homeowners who want to sell, now might be the time to list. In our town as well as across the nation, their reasoning goes like this:

1. With housing prices at or near record lows, potential buyers who had been on the sidelines are seriously considering a home purchase. Many are aware that the bottom of the market may have been reached. They feel a sense of urgency to take advantage of that combined with record today’s low mortgage rates. For home sellers who have set the right price, it can mean that March is the beginning of a spring selling season filled with newly-motivated buyers.

2. The number of bank-owned homes is predicted to increase over the next few years. Lenders had put foreclosure activities on hold while negotiating the government settlement. But the coast is now clear for them to resume, with the number of bank-owned homes rising as a result. When that glut of bank-owned homes hits the market, it could end in a crowded market and prices driven back down.

3. Individual home sellers have a built-in advantage over banks because they can move a sale significantly faster. Banks are not well equipped to sell their inventory of bank-owned homes – most do not have the staff to handle listing properties or pushing the kind of energetic follow-through that gets deals done in a reasonable amount of time. Tales of frustrating delays are already widespread, and they make dealing with a homeowner and his agent all the more appealing. To some experienced buyers, the difference is worth a premium.

All these factors mean that now might just be the opportune time local sellers have been waiting for.  If you have been delaying your home sale, why not call me today to schedule a complimentary home price evaluation?

Tuesday, March 20, 2012

Why “For Sale by Owner” Signs Cost A Bundle

When the time comes to list your local home for sale, it can be tempting to stick one of those “for sale by owner” signs in your lawn and just try to sell it yourself. Daydream visions of trips to Europe, new Lamborghinis and stacks of gold ingots (all bought with the commission fees saved) can crowd out more realistic thoughts.

Images of craven real estate agents, twirling their mustachios as they plot to under-price your home, may compete with more practical notions… such as the actual hassle of learning to deal in a specialized marketplace without specialized tools and resources.

Still, it is tempting. After all, in town “For Sale by Owner” signs cost just $8.99 at any hardware store! And how hard could it be to find out what forms you’re supposed to use to accept a good faith deposit? Or where to put the deposit so it’s in escrow (or whatever they call it)…???

The fact is, about 70% of homeowners who try to sell their homes themselves eventually hire an agent. Some of the others give up altogether -- having now established a record of owning a house they didn’t sell.

So it’s probably more practical to forget the Lamborghini, right? Well, maybe not entirely. According to the National Association of Realtors, represented sellers get higher prices for their homes than do owners of comparable homes who eventually complete a sale. Often, the difference in price is more than enough to cover the broker's fees.

Marketing your home is only part of my job. Things really swing into gear once a prospective buyer makes an offer. That offer includes more than an offering price: it also establishes how the buyer wants to structure the deal and sets forth a timeline. It’s really difficult for a homeowner to evaluate the offer and the possible consequences of each term in the contract. As a result, it is also very difficult for the seller to negotiate the offer to his best advantage. I will make sure you understand the offer and its implications -- and keep you from making a costly mistake.

A lot happens between your acceptance of the offer and closing day. The buyer usually orders numerous inspections and, depending on the results, may request repairs. These requests often lead to further negotiations. If the buyer isn't satisfied, your deal can fall apart. And a deal can collapse over financing and title delays. It’s a stressful, emotional time for the buyer and seller both.

From the moment you sign your listing agreement, I am legally and ethically bound to work in your best interest and to ensure that your sale is as profitable as possible.  If you’re considering selling your home, before you decide to just stick one of those local “For Sale By Owner” signs in your lawn, contact me for a complimentary consultation to see how I can help you succeed!

Monday, March 19, 2012

What - Me Worry About Local Housing? Maybe Not!

If you happened to be among the thousand or so consumers who got a telephone call last month from Fannie Mae, and if you took the time to answer the 100+ questions they were asking, on behalf of the rest of us I’d like to say ‘thanks!’ 

You and your fellow survey subjects have sent a ray of light our way. You told us that you think things are finally looking up! 

According to you and your 1,000 fellow respondents, homeowners who have been considering putting up their local home for sale might have reason to be more inclined to do so. On average, Americans expect home prices to increase over the next 12 months; the number of respondents who say it’s a good time to sell rose to the highest level in over a year; and a solid 65% say they would buy rather than rent their next home if they were going to move.  

Just 29% said they would prefer to rent -- even though 45% think home rental prices will go up. That is nearly ten times the number who think rents will fall.  

Delving into personal financial expectations, only 12% think that their financial situation will worsen in the coming 12 months, representing the lowest value in over a year. Fewer believe their expenses have increased significantly in the last year;, and only one in seven report that their income is lower than it was a year ago.  

Fannie Mae’s National Housing Survey is a window into opinions about owning and renting homes, household finances, housing and the economy, etc.  It is by far the most comprehensive measure of consumer attitudes toward the housing market; and since they keep at it every month, is a fair signal whether attitudes are beginning to turn up or down.  

Local attitudes tend to echo their findings, if for no other reason than Fannie Mae’s headline: “Consumer Attitudes about Personal Finances and Housing Stabilize Alongside Positive Economic News.” That may be a mouthful, but whenever you see ‘Housing’ and ‘Positive’ in the same headline, it has to make everybody a little cheerier.

If you are planning on your own local property purchase or sale, why not give my office a call? Unlike Fannie Mae, we won’t ask you 100 or more questions – but will be ready to answer all of yours!

Friday, March 16, 2012

Mortgage Rates: Getting Right to the Points

The subprime mortgage crisis and the resulting haymaker it dealt the entire housing market has caused noticeable changes in how local homeowners look at mortgage rates and the loans they negotiate. 

The intense media focus on the residential financing industry has caused everyone to pay closer attention to the form of home loans they arrange. The truth is that borrowers are more wary about the loans they choose. They are insisting on clarity in how their choices will pencil out in dollars and cents in both near and long terms. 

One decision that determines what mortgage rates wind up on local bottom lines is whether to ‘buy down’ mortgage rates with points. Points represent interest that buyers pay up front to lower the rates on the remainder – the mortgage rates that show up at the bottom of our monthly statements.  

Increasingly, local buyers are shunning the points option. 

There are many reasons for the shift. Some are clearly related to the subprime mess, but others less so. Many of today’s buyers are entering the market for the first time, and they are cash-strapped. They may find it a struggle to come up with money for the down payment and closing costs. Often, these new homeowners simply can’t afford to pay points -- even if they can be rolled into the loan.  

Historically low interest rates are another reason area buyers at all levels are thinking harder about points vs. mortgage rates.  Last week’s national average on 30-year fixed mortgage rates (3.88%) was a full percentage point lower than a year ago – when it was already visiting the basement! Some buyers just don't see the value in making an advance interest payment – financed or otherwise – when it may only knock a fraction of a percent off an interest rate that's already at such low levels. 

First-time homebuyers can also see points as an unnecessary expense if they do not plan to stay in their homes long enough for the lower mortgage rates to return the investment. For them, it just doesn’t pencil out. 

With interest rates at historic lows and lenders competing for the same pieces of a smaller pie, it has never been more important for buyers to take a hard look at the pros and cons of the mortgage rates vs. points decision.  If you are looking for a home to buy in town and would like to discuss your options, give me a call. The time has never been better.  

Thursday, March 15, 2012

Warren Buffet Now: “Buy!”

Since everyone in the country knows who Billionaire Warren Buffet is, it’s fair to call him the most prominent investment expert around. So, when Mr. Buffet offers his opinion of the housing market as he did during a recent interview, area residents considering whether to buy a home (or sell one) had good reason to pay attention.  

Mr. Buffet is definite in saying that believes now is a good time to enter or re-enter the housing market. It may not mean that it makes sense for everyone in town to go out and buy a home -- but what he does say is more than a little encouraging:

1. Buffet believes that real estate is a good investment right now because of the undeniable price factor. In an interview with CNBC, he even singled out the single-family home as a good investment opportunity. Would he personally buy a home right now? “…A couple hundred thousand” would be about right…if only he had a way to do it!  

2. According to the Oracle of Omaha, real estate is now a good long-term investment. In addition, with 30-year fixed rate mortgages below 4%, this looks like a particularly propitious time to buy a home for the long term. 

3. He also points out that there is a lot of real estate available for sale. With such a large inventory available in all over the country, area buyers join others throughout the country in having an unusually wide number of options available.

Even though Buffet’s prognostications on the housing market have not always been spot-on, his track record as an investor speaks for itself. He points out that while some of these same positives are true of other investments, single-family investors have a built-in advantage over institutional competitors. When we buy a home, it’s likely to be our single largest investment. To institutions, that same purchase is too small to consider. Less competition means more opportunity.

When someone like Warren Buffet says he would invest in hundreds of thousands of homes if only it were feasible, that does have a way of making anyone pause and think.  In other words, in case you have been considering whether now is a good time to buy a home or local income property, go ahead and call me today. Let’s talk over the prospects!

Wednesday, March 14, 2012

Uncertainty + Homes for Sale = Good News

Now there’s a headline that doesn’t seem to make much sense! But here is why I think it does:  

For a long time the ‘the economy’ seemed to be just some distant abstract notion. Talking heads on Sunday shows jabbered about it, made predictions or shied away from making predictions about it, and life went on either way. Certainly local homeowners would decide to put up their homes for sale and prospective buyers would look for local homes for sale without first checking on the state of ‘the economy’. Remember those days? 

Then the whole thing seemed about to crash (and just missed doing so). People started to pay attention as their own lives became affected. Soon everyone began to pay attention, and to hesitate before making plans. 

And now we have a situation where the economy is…headed up? Headed down? In a stall? About to stall? It’s anyone’s guess. It’s no wonder why individuals and families have been waiting for ‘the economy’ to declare itself one way or the other before making major decisions (such as beginning to hunt for local homes for sale).  

When there’s uncertainty in the air, it does not create a comfortable atmosphere for making large commitments. But there are major reasons – comfort aside –  why the atmosphere this March may be perfect for beginning to seriously investigate area homes for sale.  

Large inventory

In any market, buyers find options when inventories are strong. The uncertain financial conditions have led to precisely that situation. If supply were the only factor, now would certainly be one of the best times ever to look for local homes for sale. It also makes it much more likely that you will be able to find precisely what you desire…and probably at an affordable price. 

Low financing rates

One factor about which there is no uncertainty at all is this March’s financing rates. Rates are famously low, and most of the aggressive financial products that were associated with mortgage shenanigans have already been discontinued. First time buyers can check out the FHA to find out what options are available. And if you look at any historical chart, you will see how the squiggle is scraping along the bottom – the ‘good news’ area for homebuyers! 

Discounts from builders

Many builders have grown keenly interested in saving their credit by clearing out inventory. In this kind of buyers’ market, it’s not unusual for potential buyers to ask for improvements, price reductions and discounts on closing costs.  

The only thing that is certain about the future is that whatever is happening today, sooner or later it will change. When it’s widely agreed that ‘the economy’ is roaring back, the factors that are so favorable now will change with them. That’s why I believe that for area homebuyers, Uncertainty + Homes for Sale = Good News!

Tuesday, March 13, 2012

Million-Dollar Foreclosures Up, Midrange Down

It’s not what you would guess, but there it is: according to CNNMoney, the firm that keeps track of foreclosures has reported that the foreclosures on million dollar properties is growing while foreclosures for midrange properties are beginning to drop. 

It’s been five years since the housing market began its precipitous drop. During that time, overall growth in foreclosures has been front and center for headline writers in our area and throughout the rest of the nation.  But only now are foreclosures among some of the nation’s wealthiest homeowners drawing attention. The foreclosure rate is rapidly increasing in this group --and at a faster rate than for the rest of the United States.   

Surprising also is that many of these wealthy families are doing so voluntarily. 

RealtyTrac is the firm quoted by CNNMoney. Its data show that last year upwards of 36,000 homes valued at $1,000,000 or more were foreclosed upon or served with a notice of foreclosure (default). Even though that is fewer than 2% of all foreclosures nationwide, it still represents a greater number of foreclosures than seen in earlier years. For wealthier homeowners who actually could continue to make mortgage payments but decide not to, it can be a business decision. Financial experts call such foreclosures “strategic defaults.”  

RealtyTrac also found that the number of foreclosures on properties valued at $1 million or more has risen by 115% in the last five years, and twice as fast for those worth more than $2 million. However, among mid-range homes – those valued between $500,000 and $1 million -- foreclosures actually dropped by 21% during the same period.

It seems that the housing crisis may be ending from the bottom up, with borrowers who purchased lower-cost homes now beginning to emerge from the storm, even as some of the wealthier families (admittedly a very small percentage of them) go through the same trial.   

The silver lining?  If you are looking to buy a home in the $1,000,000+ range, now could be your window to snag a once-in-a-lifetime value!  Call me if you would like to see a complete picture of all the local properties for sale this March.