Real Estate Information

Ok, I admit it. Sometimes I m wrong. Not often when it comes to real estate, but it does happen from time to time. Maybe I drank too much bubble blogger juice when I analyzed a couple homes for sale in my neighborhood.

Both sold well before I estimated they would and they both sold for higher than I thought they would.

I ve been following two homes in my neighborhood for sale. If things keep going the way they are, I m betting they ll still be for sale in March.

I finally got to take a look at the sold data for these two homes.

House 1.

I said, “Nobody in their right mind will ever pay $409k for this house.” I also said it would still be available in March.

I was right about the sale price, wrong about the timing. It sold for $375k went under contract in December and closed in February.

House 2.

I said, “House #2 dropped to $309,000. Getting warmer, but still needs to go down $30k more to sell.” I also said it would still be available in March.

I was wrong about the sale price and wrong about the timing on this one. It sold for $291k and closed in December.

The Salt Lake real estate market continues to show steady growth in new home sales and strong appreciation for existing homes. Like I said the other day, even days on market is shrinking while inventory remains about the same as last year.

Can you afford to wait to buy a home in Salt Lake City? Not with the current pace you can t.

I will be running some of my listings in the local Real Estate Guide. The guide is choc-full of outdated listings (because deadlines are a month in advance).

Over the years I ve had so-so success with this kind of advertising on behalf of my represented listings. Although, when I first started in this biz, I used to put a few bits of other information about me on my page. Used to have an in-action photo of me playing hockey, a nice photo of me and my wife, that kind of thing. I d get people saying, “Hey, you are that guy in the picture playing hockey,” or “Wow, I didn t you were married to her. I ve known her for years.” I placed photos of my wife in my ads because she has lived here in Kingman most of her life. The hockey photo was in place of listings that I didn t have at that point in my new career. But again, these more personal ads for whatever reason got response. More than the photos of the listings.

Clients love to see their homes advertised in the local Real Estate Guide. While it is likely that there is benefit from such advertising, it is hard to gauge the bang for the big bucks. When the market was piping hot I stopped advertising in this guide. By the time the guide hit the presses and was being delivered, most of my listings were already in contract. The guide became razor thin practically. Now it is thick again and the average time on market is well over 30 days (more like 4 months and beyond).

I ve promised some of my clients that I would run ads for them in the guide in upcoming months. This gave me some time to think about including some other more personal bits to include on the pages once again. No, I m not going to waste ad space with my hockey playing ability or put my wife through the “I didn t know you were in the real estate business” phone calls again.

Here are the ads that I am going to include

Click on either to enlarge. It is my hope that I can draw more local readers to this blog and even to my sales website. I also am curious to see what kind of response the flat fee ad might bring. I d be thrilled to hear folks say that “You re the blog guy” or “You re the flat fee guy”. After all I do think that if I get referred to as the above it would mean more to my business than “You re the hockey guy” or “You re the guy married to Gail” (which, honey, if you are reading make no mistake that I will always be thrilled to be THAT guy who is married to Gail).

Yesterday I made a post about January s existing housing in Salt Lake. Today I got a report from NewReach on new homes throughout Utah for 2006.

In Arizona when a Realtor uses a contract to write an offer on a property, it will include a period of time called the Buyers Inspection Period. I ve since renamed this period the buyer s Free Look , because during the inspection period a buyer can practically give any reason to cancel a contract and be entitled to all of their earnest money back, almost no questions asked.

So what can you gain by getting a home inspection at the time you decide to sell your home?? Well for one you will know the true present condition of the house through the eyes of a licensed inspector. Chances are the buyer for your property is going to hire the services of an inspector, and chances are good that a buyer is going to furnish you with a laundry list of things that they want you to fix before they go ahead and truly agree to proceed with closing the transaction. You won t be happy on this day.

Inspectors climb around in the attic, check plumbing and electrical systems, and poke around in plenty of other dirty places that most sellers never bother with in their own home. They will find things that will surprise a seller at times. And when buyers find these things they think you are trying to sell them a lemon, again not a fun day for you. It is much better to know about whatever they find before you may be in the middle of a transaction. Especially if you ve already called the moving company and have begun to pack your belongings.

Think about this in terms of setting the price as well. Lets just say that your home has a very favorable inspection report, one that says there are no real red flags or needed repairs. You would have third party, licensed evidence of this fact and could advertise this. Between two different sellers with a similar property, who would have the negotiating advantage with a potential buyer?? The seller with a true picture of the condition of the home, or the seller that is waiting to find out from the buyer what the inspection report has on it??

Even if your report comes back with some negatives on it, you certainly will know about these and will be able to fix the issues. This could allow you to once again ask for more $$ for your home than a competing seller, depending on the issues. Most sellers in today s market hang on the whim of the buyers and their inspection report. Get in front of the issues. Most home inspections cost in the neighborhood of $300, and it is a small price to pay if it means you can get a few thousand dollars or more for your home. This is a unique opportunity as most sellers nor listing agents do NOT make an inspection a standard of practice.

By ordering a home inspection before you list your property will also help you with your seller disclosures. You will be able to offer a more accurate representation of what you actually know about the home. This also covers you to a degree if a buyer decides to use your disclosures against you in court after the sale for some reason. Having an inspection report to give to the judge is better evidence than saying you didn t know at the time.

You can also offer a copy of the inspection report to the buyers after the offer is agreed to. The buyer still has the right to have their own inspection done (and I would still recommend it to my clients). But again, lets say you have your own inspection report and found some items that needed correction. You simply fix those issues and provide receipts or invoices from the folks you hire to do the repairs. Now the buyer sends in his inspector and asks that these particular issues are paid attention to chances are they don t show up on the buyers inspection report and the transaction proceeds without delay.

An inspection report can validate your asking price and will give you an advantage in the market if used properly.

For any local folks who are thinking of selling your home I will make this offer to you. If you hire an inspector for a home inspection and hire me as your listing agent, I will refund you the cost of your inspection at the close of a successful transaction out of my representation fees. Simply provide me a copy of the inspection report and the invoice at the time of listing or sometime before an offer on the property is made. In fact, through the end of this calendar year I will double the refund of your cost of the inspection at the close of escrow out of my fees. Some restrictions would apply, but they are reasonable and negotiable.

Normally when I complain about mainstream media headlines concerning housing, the headline normally depicts worse news than the actual numbers being reported. February s existing home sales were just the opposite. The headline said, Home price slump helps spur sales.

The numbers on the other hand, showed median prices went down and year over year sales, the only figure that matters, were also down. The good news, and this was the part the media focused on, was February s sales outpaced January. While this is good news, it s relatively meaningless. Each month could outpace the previous one for the entire year and we could still end up with 2007 having less sales than 2006.

The National Association of Realtors said Friday that home sales rose 3.9 percent last month to an annual rate of 6.7 million from a revised 6.4 million pace in January. It was the biggest percentage increase since March 2004.

Economists surveyed by Briefing.com had looked for a slowdown to a 6.3 million pace. But even though sales rose from January, the pace was still down 3.6 percent from February 2006.

But the report also showed the median price of a home sold in February fell 1.3 percent to $212,800 from a year earlier.

One month of data is normally not enough to see a trend and it is encouraging that February s report exceeded analyst s expectations, but a year over year sales decrease doesn t really bode very well. The important thing to remember is housing varies from city to city, even neighborhood to neighborhood.

It s looking more and more like the housing market is shifting into the favor of buyers. If the bubble blogs are right, there are plenty of people waiting on the sidelines for the right time to jump back into the housing market. Even in the worst housing market in the country, Detroit, deals like a $1300 house, can be had.

Pardon me, but I think I have to channel Dennis Miller for this post.

::Start rant::

So I got an email from one of my favorite lenders today about new rates and terms for 100% and 97% loans -

We ve been given a heads-up from our Secondary Marketing Department. We continue to see deterioration in the 100% products and Stated Income product offerings.

We do not have all the details but we wanted to alert you to the following:

If you have floating loans in the pipeline that fall under these products please lock them immediately.

What hurts is these new changes appear to come from Fannie Mae, meaning, my favorite lender isn't the only one that will be affected. This will be a systemic change. FICO scores have been raised from 680 to 700. On top of that, the rates are increasing; 100% by .25% and 97% by .5%.

So why am I upset about this? Because like the way Homeland Security treats airline passengers, Fannie Mae is applying a broad brush to a problem that needs specific, targeted action taken.

Homeland Security knows that people who attack America from overseas so far have proven to be young Arab men. Their solution to the problem of young Arab men committing terrorist acts is to make every grandmother, housewife and businessman from Anchorage to Kalamazoo be searched from head to toe for cuticle scissors and toothpaste! All of this comes with a price tag of billions of taxpayer dollars. BILLIONS!

It appears that in the face of a housing downturn, America's government sponsored enterprises which facilitate the movement and efficiency of the mortgage market, are taking a similar approach. Instead of eliminating making loans to the people who are most likely to default, they are eliminating entire programs.

I'm going to let you in on a secret here. Those "subprime" lenders that have gone out of business because of forced buybacks are going down because of fraud:not because of a few greedy borrowers here and there. They're going down because of corporate cultures that value production over quality and a lack of regulation and oversight over corrupt mortgage brokers, real estate agents, appraisers and title personnel who are also in on the scam.

Subprime lenders are not seeing losses because the nature of the business is bad. They are seeing losses because they ignored the precautions put in place to reduce risk. Considering that about 15% of loans are even in the subprime category and that of these 15%, 90% of borrowers are paying their mortgages, the fact that a few lenders have generated so many buybacks for first payment default and fraud tells me this is not a systemic problem, it's an isolated problem associated directly with the originators of those loans. Those lenders who have tolerated and encouraged this kind of behavior are now paying the price.

Unfortunately there are many innocent victims with mortgage fraud and everyone will pay the price. Fannie Mae is applying a knee jerk reaction to the problem. Just like Homeland Security, a broad net has been cast to scrutinize everyone, not just those who we know are most likely to be the problem.

::End rant::

The Salt Lake Board of Realtors normally publishes housing numbers on a quarterly basis. They usually turn up around the 20th of the month following the end of the quarter. With all the national shakeup with loans and housing, I ve been very curious to see how the local market is doing. I ve seen anecdotal evidence from the industry that things are still OK in Salt Lake, but I m getting emails from potential clients asking if they should wait.

Today, I got my answer. I managed to snag a copy of the latest copy of the Realtor magazine. We ll have to wait until April for the quarterly report, but this magazine did have January s numbers.

2007

Average List Price - $257,469 Average Sales Price - $254,349 Days on Market - 41

2006

Average Sales Price - $220,109 Days on Market - 44

That s a 15.5% increase over last year. No major price drops are happening and sellers are getting very close to their asking prices. Additionally, houses are selling faster. And this was January and this January was very cold!

Waiting for first quarter s results will paint a better picture for prospective homeowners. The question you have to ask yourself if you re looking for a home in Salt Lake is, “can I save more than the prices are going up.”

By Marshall Loeb MarketWatch, Inc.

The task of packing up all your things to move to a new place can seem daunting at best. A move, whether it s cross-town or cross-country, is often fraught with anxiety and headaches: Which mover should I use? Am I getting a good deal? Will my belongings be safe?

Because moving expenses can run high, it s smart to do a little research before handing your money - and your hard-earned possessions - to just anyone.

Click here to read the entire story.

Just an update on a couple of things that happened over the weekend, but not really real estate related.

My sister Teri (you may have seen her comments here as she is a loyal reader) is in Las Vegas right now with plans on moving there from where she lives in Hawaii. She and her husband are interviewing for teaching positions, I think today in fact. Their plan is to live in Vegas sometime this summer.

On Saturday I was able to play a round of golf with Teri and one of my dearest friends, Eric Weiss. While Teri is planning on moving to Vegas, my good friend recently took a job which will move him to Austin Texas. He is going to be some big-wig manager at a large lending firm. It is funny, my family is moving closer to me from parts all over the country, while my friends from Vegas seem to be moving out of the area.

One thing you should know about my sister is that while I was good at things like sports growing up, she excelled at those things. She made all state teams while I may have been lucky to merely make the team. She was the star player and I was the role player. Luckily she is six years younger than me so I didn t have to deal with these kinds of facts while in school. Well Saturday at the golf course this fact reared it s ugly head once again.

Eric, Teri, and I were to tee-off in the early afternoon at the Tuscany Golf Course in Vegas. The course added a fourth to our group and it just so happened to be a fellow Realtor that works in Las Vegas named Jeffrey Gahr (I m having trouble with his website so I cannot link to it). He was a very nice guy to play golf with and he played very well.

Right away Teri was impressing the group with her shots. She tells me that she hasn t played in a long time, but every drive seemed to be long and straight. Sure she was a little rusty, but even my buddy Eric tells me that it is easy to see who the real athlete of the family is.

On the back nine, our fourth says that we need to play partners and he selects Teri as his partner. We play best ball (meaning that of the partners whoever has the best score wins the hole). I accept the pairing. I m not going to lose to my sister right?? Wrong, Eric and I never win a hole from that point on. In fact Teri won a hole on her own when her partner hit a ball out of bounds early on the hole we were playing. I was sure that Eric and I would at least tie her, but no, we choked — no make that — she excelled in typical fashion.

It was a great day no matter how you slice it (and I sliced it on many of occasion).

Locally while I was having so called fun in the sun, my wife was having a garage sale at one of our rentals. When the last tenants moved out they left a garage full of items, including some really nice power tools. My wife Gail is very involved in this years local cancer walk to raise funds for the American Cancer Society. She decided that all proceeds from the sale of the former tenants items would go towards her efforts to raise money. She happened to collect $370. She didn t even place price tags on the stuff that sold, she merely told people that the money was going to charity and the people gave more than I think they normally would have if this was a normal garage sale.

She was moved by one of her customers. He was a young boy (I think she said around the age of 9), he offered her 20 cents on something and Gail said that would be great. He then asked her about the charity and she said that she was trying to raise money to help save people s lives. He then gave her the rest of his change that was in his pockets and said to her to add that to the effort. He even then went to his parents car and got more money and gave it to Gail. Gail was practically in tears when she was telling me this story. The people of Kingman were very generous and there were other stories similar to this.

My only regrets this weekend is that I don t have any photo s to share on either happening.

FIXTURES AND PERSONAL PROPERTY: A fixture is an item that was once personal property, but is affixed to the home in such a manner as to become a part of the home itself. A buyer purchases the fixtures affixed to the home, but personal property is not part of the transaction unless it is listed in the contract. The contract should specifically identify all items that are to be conveyed in the transaction[1]

If you have your home for sale or you are thinking of placing your home for sale this definition may mean the difference between a smile or a few tears.

I have to relate a story here about a seller who had a beautiful handmade clock. The clock was the focal piece of the living room and was situated right above the fireplace. The clock was so large and the manner in which

it was attached could have been construed as 'affixed'. When the offer came in I was excited for my sellers because it was a full price offer, however, on the page that contains the additional language the buyers had requested that, and in some very specific language, the clock stayed and became the buyers property.

Now, the sellers and I had the discussion that all of the items, like the clock should be put away while the home is offered for sale, but the sellers also felt that the home and the space defined by the fireplace really showed well with the clock there. We had a discussion about what should be done about removing it and replacing the space to it's original state. Of course, it was true that the clock did make the fireplace stand out but now the sellers where faced with making a decision. Since their move was precipitated by a lucrative job offer that included relocation they were concerned about doing anything to jeopardize the offer. I was prepared to discuss with the buyers agent how important the clock was to the buyers offer but the sellers asked that I let it go since they had put themselves in the situation anyway. So it was that the clock went with the transaction and the sellers shed a bit of tears when saying goodbye to their beautiful clock. Moral of the story: If it is precious to you, put it away. [1] Definition from http://www.aaronline.com/documents/RealEstateLang.aspx