Real Estate Investing

In what appears to be a move not unlike the insurance “If you die, your house will be paid…” coverage, one real estate firm in Queensbury, New York is offering job loss protection insurance for home buyers interested in listings offered by the company.

Sellers of homes listed with RealtyUSA have the option of paying a one-time $500 fee toward insurance for the buyer. Should the buyer lose their job within two years of the closing, they can receive up to $1,800 a month for six months toward mortgage payments.

This is a BOLD move, but is being done in partnership with The Rainy Day Foundation, a group whose major focus is to provide tools to educate, counsel, support and financially assist homeowners who experience unforeseen short-term financial problems.

A friend of mine once suggested that if someone loses a job, the mortgage holder should allow an automatic waiver of payments for six months like students loans now provide.  It seems like this is akin to that suggestion, but I’ll be curious as to how well it will work.  To learn more, visit the company’s web site here.

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!

Although existing home sales gained 5 percent in February according to the National Association of Realtors - and reported by MSNBC.com - the slow down in home sales over the past six months may be breeding a new way to price homes when they are listed.

A friend of mine contacted me last week because she may be taking a job out-of-state.  Her home is already located in a neighborhood where few houses turn over… it’s not that they don’t sell, it’s that people don’t leave.  Because of this, it may be very challenging to come up with a fair market price point to list her home.  When I ran my numbers, I can justify listing it for between $180,000 and $280,000 - a price spread too wide to make me at all comfortable.  I don’t want her to sell it for too little, but also don’t want to price it so high that she can’t sell.

Clearly I’m going to have to call in the cavalry on this one.  I’m putting together a pricing team to go with me to review the property.  After we tour the inside of the home and walk the acreage, we’re going to separately crunch our own numbers.  Afterward, we’ll sit down at the conference table to defend our potential list price - our final number is the one I’ll share with my seller.

This type of scenario could become more commonplace as it gets harder to find comparable home sales since sales have been down.  I’m relieved to have a team of colleagues willing to help me out because certainly I won’t mind stepping in to help them as well.