Real Estate Investing

Perhaps this is a rhetorical question but we’ll attempt to brainstorm reasons why.  Why would someone put their home on the market and then not allow showings?

10.  Court ordered sale, so owner really doesn’t want to leave. Just on the market to obey judge’s ruling.

9.     The house is nasty inside.

8.     Need time to remove body from freezer before anyone accidentally finds it.

7.     There are dangerous animals who bite.

6.     Lonely.  Just hired Realtor for someone to talk to.

5.     Foreclosure and current occupants aren’t yet out.

4.     Like your new paint colors and want to see how they look online.

3.     Playing a cruel joke on your neighbors who hate you… pretending to sell but not really.

2.     Waiting for smell to subside.

1.      Fear that potential buyer will contaminate your house with the swine flu.

I hope my colleague will be able to get into the house eventually to show her buyer!

It was with great interest that I read a post on Active Rain by Ken Cash of Incline Village, Nevada.  He poses the question of rent v. own - a question Realtors regularly face in this market.

This past week, I had the usual buyer who says, ‘why buy?  Shouldn’t I just rent?  After all look at the costs of owning.  Sure the interest rates are low, yes I have good credit and can qualify.  Yep, I have 40+% for the down.  But why?  I mean look at the costs.  I am going to pay $3000 month in payments, the taxes are $19,000 a year, the homeowners association is $385 a month.  OK, I have $60,000 in deductions.  So what?  I can rent this same place for $2000 a month.”

After seeing property taxes of $19,000 per year and knowing my own are under $1500, I think I’d definitely rent, too!

There’s a web site that I won’t say the name of here (not so G-rated name), but it touches on some of the myths of home ownership that are valid.  For example, the writer says it’s a myth to think that when you buy you build equity through forced savings of paying your mortgage.

ABSOLUTELY NOT! That is exactly what home equity lines and continuous refinancings were all about. Spending your savings as opposed to accumulating it and making yourself a “renter with an option to eventually own”.  A person very close to me has just refinanced a 30 year mortgage after 21 years effectively turning it into a 51 year mortgage and unless the almighty intervenes they won’t be paying it off in this life.

I have refinanced my home about two or three years ago and very much regret it.  It was when home values were climbing like crazy, so we thought we suddenly had $40,000 in equity after just two and a half years.  We refinanced and paid off credit cards, two cars, and consolidated our 80:20 mortgage into one mortgage. Now if we want to sell, we’re in upside down because our home is worth only about $20,000 more than when we first bought because of dropping home values.  We plan to ride it out, though.  Or see if our bank can do a refinance at its current value.

Welcome to the reality of the popped housing bubble.

Do I really want to be honest with you and say when my last closing occurred?  No, I don’t WANT to, but I will.  It was in December.  I have remained busy … taken four listings, counseled someone on renting their home because of poor home values, have worked on a couple of lease purchases.  But no closings.

This is about to change, thankfully.  One of my listings has sold and we’re waiting only for the appraisal to come back.  My heart is in my throat as I anxiously await the findings.  One of my lease-purchases moved in yesterday, so we continue to move them toward final purchase.  And my phone is beginning to ring … people are calling interested in buying.

Today’s article on MSNBC.com underscores that buyers may be returning to the market, but they don’t seem to be in a hurry.

The number of house hunters out this spring is an encouraging sign that the real estate market is beginning to turn around. There’s just one problem — a lot of them are in no hurry to buy, according to interviews with dozens of shoppers at open houses last weekend.

The market’s turning point will be tough to predict, because it will be gradual and obscured by conflicting signs like recent housing reports that showed sales of previously occupied homes fell 3 percent from February to March, while new home sales seemed to have bottomed out.

I am trying to hang in there as a Realtor - finding ways to earn extra income while I wait.  Finding ways to contact those potential buyers.  Finding ways to contact the people I know who might refer someone to me.   Trying to be realistic and not let my Pollyanna dreams mar reality.  I wait.