Real Estate Investing

An always fabulous agent I work with told me recently about one of her closings.  She found a home for her buyer that had first been on the market for $145,000.  Following the market downward, it was reduced after several months to $130,000 in order to remain competitive.

Her buyer wanted this home, so they wrote a contract.  In the contract, they asked for 3% ($3900) in down payment assistance and 3% ($3900) in closing costs.  They also asked for a home warranty, a $1000 repair limit, termite inspection (we’ll say $75, but could be up to $800 depending on whether termites were found), and for the seller to pay for title expenses (another $1200).

This once $145,000 home was being purchased for

… drumroll …

$119,925 after the seller paid all of the concessions on behalf of the buyer.

That was $25,075 less than the original list price.  BUT because the market sets the price - and in fairness - the number would be $10,075 off the list price.  So the buyer made a full price offer on paper, and yet it was not a full price offer.

It got back to my friend the agent that the buyer’s father fussed at everyone he met because the agent didn’t get her son a “good enough” deal in a buyers market.  I beg to differ.  That she saved his son over $10,000 dollars from the list price was a pretty fabulous deal.

Yet there are always people who argue that it wasn’t enough.

Another friend of mine wrote a comment to me about full price offers saying, “No one should ever pay full asking price for anything that lends itself for negotiation possibilities…..there is always someone willing to wiggle….keep looking.”  I respectfully disagreed with her given the scenario outlined above.

I believe people need to always remember that just because you see something on paper, it doesn’t tell the whole story.  A full price offer may appear to be full price, but when a seller walks away with over $10,000 less than expected, they are not receiving full price.

Of course, you can also ask yourself how badly you want a house.  Even in a strong buyers’ market, homes in your price range in safe neighborhoods may not be available, so you do what you have to do.

I urge buyers and agents to never let the naysayers convince you that you made a mistake because only you know and have the complete picture of what your needs are.

Photo by Kathy T. and her blackjackii phone. Special guest: the calculator.

When you’re ready to sell your home, thinking beyond running an ad in the Sunday paper is what it’ll take to get a contract.  Although many agents and “for sale by owner” homes are still found in the Sunday paper and in supermarket real estate books, a staggering 85 percent of buyers today turn to the Internet when looking for a house.  Online, buyers have the opportunity to look at interior and backyard photos, read about additional features like whether the yard has a fence and marble counters, and find directions so they can drive by they neighborhood before making an appointment to tour.

A good marketing effort will certainly focus on online, but a well-rounded program will also include some tried and true methods.  Here are my Top 10 ways to market a home. 

1. Put a brochure box in front of the home for flyers that will include basic information like number of beds and baths, interior photos, square footage, and contact information for a personal tour.  Make sure the box is never empty!
2. The local MLS is perhaps the single biggest boost to any listing.  Be sure the information is accurate, honest, and please-for-the-love-of-buyers include photos.  If you don’t they’ll pass you right by because honestly your words aren’t that eloquent that they’ll pull in a buyer without a photo.
3. Use Postlets.com.  This fantastic site is easy-to-use and will promote your listing at many other online places like Trulia, Zillow, and GoogleBase. 
4. This ties in with Postlets, but once Trulia picks it up your listing will go to Trulia Snapshot.  This is one of the most awesome, amazing, coolest sites I’ve ever seen.  Go there immediately.  Do not pass go.  Do not collect $200.  It’s that good.
5. Develop a web page just for the listing at Freewebs.com.   Here’s a sample page by Theresa from my office, done for one of her listings.  I admit I haven’t done this yet mostly because I blog about my listings.
6. Write a blog.  It doesn’t have to be about real estate, but can focus on your family, your neighborhood, your town.  I’ve met a lot of great friends from hosting a blogsite (though I often call it a “site” because blog is such an icky word). My community blog has a real estate section where I feature my listings … some listings I’ve gained because I show that I care about my community.
7. Make business cards for your home.  Include an outside photo of the home and other basic features.  Give the cards to the home seller and ask them to hand them out to their friends, colleagues, and neighbors. 
8. Curb appeal.  The house MUST look good on the outside to attract buyers to the inside.  This isn’t necessarily the job of your Realtor, but a neat, well-kept appearance will go far to promote your listing.
9. Host a Realtor home tour because another agent is probably who will bring your buyer.  We have office caravans every week, but hosting a luncheon is an option to make other agents feel welcome.
10. Finally, Animoto is one of my favorite online sites.  I’ve opted to pay the $30 p/year fee for an unlimited amount of “long-version” videos, made by uploading still photos and selecting music.  Here’s an example of one of my listings.

Good luck and happy selling!

More home sellers are turning to the rental market as an alternative to taking a financial hit on their property, according to the Atlanta Journal Constitution. The offers they are receiving are so low, in many cases, that sellers decide they’d rather be landlords. Some prefer the seller financing route, offering buyers a lease-purchase agreement. Either way, this housing market is forcing sellers to get creative.

But this new trend presents difficult scenarios to two different population groups. There are those who are moving long-distance due to a job transfer or other circumstances. A lot of sellers fall into that category now - if they are crazy enough to move in this housing climate, they are doing so involuntarily. Renting and/or lease-purchase could be difficult for this group of sellers because it will be nearly impossible to oversee the maintenance and well-being of the property, as well as enforce rent payment and find new tenants when needed. This group may do well to hire a property manager before moving out of town.

The renters themselves comprise the other group that will be negatively affected by this trend. This group is growing drastically because of the many foreclosures and related bankruptcies and ruined credit records. According to the AJC:

“‘I put more people into rentals last year than all my previous years in real estate combined,’ said Jamie Hook, a realtor with Metro Brokers GMAC Real Estate in East Cobb. ‘I think the rental market is pretty good now. And I think we’ll see the rental market improve.’”

So while the number of renters is growing, the number of rental properties will be shrinking whenever the housing market recovers. All these sellers who are forced to do rental agreements will certainly be putting their houses on the market at the earliest opportunity. This could mean the displacement of countless tenants. Maybe it’s a good time to get into the apartment rental or lease-purchase business.