AmyBSells Team - Cincinnati Real Estate Blog

Amy March 25th, 2008

This morning, I was up with the birds, hoping that spring will find its way too cold and confused Cincinnati Weather. We need spring here to make our lawns and trees green, so our Real Estate can look beautiful for our promising spring market.
I was reading Real Trends Newsletter online today and thought I would share the whole article with you, along with some points I thought you might find interesting. I also wanted to point out some points that I have been sharing with you all along, since the market became not so easy to work in. As you all know, I am a realist, and a very painfully honest Real Estate Advisor. I like to try to find the positive in every situation, and we still have some reasons to be positive in this market. Let me share with you some thoughts….
This March edition of Real Trends newsletter that is attached suggested that this year, for the first time ever, the number of Realtors and associated Real Estate Professionals (Lenders, Appraisers etc) have declined. Only the Strong Survive! This has proven true in the Cincinnati market as well, as membership in the Cincinnati Area Board of Realtors dropped when our annual fees were due in January.
Interesting as well that 50% of all listings in the country are held by the nation’s top firms, listed in the article. I believe this is a true testament to BRANDING the large companies, and the internet reach of so many large Real Estate Companies. As you may recall, Remax is an international Real Estate Name, in over 60 countries on Earth! Easy exposure for your home in any part of the world. In fact, recent data shows that Remax is only behind Realtor.com and Homegain.com with the largest internet market share in the US, Based on NAR statistics.

Real Estate Auctions have become more widely used in this current market. States that were hit hard with the market value decline like Florida and California, report the use of Auctions to sell real estate up 46% from 2003-2007. Interestingly enough, the foreclosure properties are not successful at auction sales, as they report that banks are not able to take low bids or the types of hits that auctions often result in)

FORECLOSURE UPDATE:

VERY IMPORTANT INFO ON page 5 of this newsletter if you want to invest in a foreclosure! This will be another article on my blog entirely. This section of the newsletter warns of the same issues that I have previously discussed in my articles on Foreclosure and the hidden costs and the slow banks response times. The bottom line on Foreclosures, they are not good if you are looking to buy your first home, to move your family in the home, if you are looking for a good experience with ease when you purchase, or if you need a loan to purchase, if you do not have cash on hand for unforeseen emergencies. Foreclosures are still best for those that have SUPER PATIENCE, do not need to buy, and have cash, mostly investors.

Real Trends compiled a chart of all the major data sources in US Real Estate, which all 8 sources showed a decline in year over year change in the national price index, ranging from -0.3 to -10.9%.
In the markets in the US that are selling homes, they found that those selling are priced BELOW $250,000, and are “cleaned up.” Contributing to my 2008 motto: We are in a PRICE WAR and a BEAUTY CONTEST with home sales in Cincinnati.

Further, in all of the major markets, only 4% of the inventory is on the market for less than 4 months. 95% of inventory is on the market for 4-12+ months, and over half of those 95% are on the market 9-12+ months. The silver lining and positive spin on this data, is that in Cincinnati, we experience the same issues, but certain areas of the city are on the market far less than 9-12+ months! Areas like Hyde Park, Mt. Lookout and Oakley have a high demand, a good portion of housing at or below $250,000 and are experiencing about a 95-97% list to sale ratio in today’s market. In my own business, my average days on market are between 45-25 depending on the part of town, and my overall list to sale is 97%. I know that my experience and success pricing homes for the current market has directly contributed to my rapid sales and high ratios. I contribute this to experience, realistic sellers, and .
I have to agree with a statement that Forbes magazine wrote recently, that was quoted in this Real Trends Newsletter, and I will increase the size and change the font for good measure,
Greed and Impatience are the top 2 factors contributing to our current market conditions today.
Another interesting set of data regarding negative equity in homes in the US. The longer you own your home (5 years being ideal, the longer the better in this market) the more equity you have. The data was collected from 72 million owner occupied homes, suggests that
30% of homes purchased in the last 12 months have negative equity
39% of homes purchased in the last 24 months have negative equity
LESS THAN 2% of homes purchased in the last 5 years have negative equity.

What does this mean to the homeowner? Stay in that house as long as you can, especially if you have a 100% or an FHA loan with little or no down payment. You will need every bit of equity you can get! I hope that my clients recognize that I want to help them sell their homes for a gain, not a loss. The longer you own your home, the more gain we can find you, the shorter, the more likely it is that you will need to make up for the loss at the closing table. The AmyBSells Team can sell a home in any market, we prefer to help you make money, and curb any losses. In the end, we price the house for the market, not the equity position.

THE POSITIVE

The report suggests that there will be more new households created in the next 10 years, than there were in the last 10 years.
Congress has done some good things for the housing market: They increased FHA loan limits, which have helped a number of my clients, they have passed laws to deter some foreclosure increases, which helps area property values not decline, and they are creating a number of Real Estate associated Tax Credits, which encourage buyers to purchase real estate.

CONCLUSION

As a Certified Residential Specialist, selling more than 32 homes a year in a down market, REAL ESTATE IS SELLING. I tell my sellers, if you have to sell, we will get it SOLD for you, but now is not the time to have unrealistic expectations. I did not cause the market conditions, and I cannot cure it, but we must make the best of the situation. There are proven ways that my team has found to position your home for a solid SALE in a realistic time frame. Call us to help you position your home for a successful sale! We have proven results in this challenging market!

• Buyers , Financing , Foreclosures , Housing Market , Lending , Pricing , Value
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Amy March 24th, 2008

According to the National Association of Realtor’s, curb appeal sells 49% of all houses. The front of your property should be alluring enough so that a buyer and agent, driving by slowly, will actually want to stop his or her car, and get out to have a look. That is curb appeal.
Your property should also give the prospective buyer a feeling of confidence in the property. Risk is something that we all avoid when buying real estate. If the property looks like it needs improvement then that perception alone will introduce the idea of risk into the transaction. However, if the property is well cared for and has tasteful decor then the perception of risk is lessened. Simply, a nice house is worth more or will sell faster, given the market conditions.

It’s important to understand the difference between price and value. Price is the amount you are asking for the property. Value is the buyer’s perception and can be influenced by location (it’s 2 miles from my office!), features, condition and most importantly, comparison to similar homes on the market. While you can’t control all of these factors, Real Estate Opinion Expert Paul Bianchina shares some tips that, when properly attended to, can have a positive impact on value and significantly increases your chance of attracting qualified buyers more willing to pay closer to the asking price, and have your home sell in less time than competing homes on your street or in your area that could be on the market for 6 months to a year.

Some tips to achieve a positive impact on value are:

1. Perceived size impacts value, even more so than actual square footage. Open floor plans make a room feel bigger than larger spaces with smaller rooms. Showing property that is furniture free, or at reduced clutter, helps to make the space feel bigger.
2. Vacancy increases sale-ability. Property is easier to show and easier to sell, and quicker to take possession of when it is vacant at the time it is offered for sale. Evidence of problems to take possession of the property — such as encroachments, or tenants who won’t allow buyer tours — negatively impact value. Vacancy also helps the buyer walk through the property imagining ownership. Sellers should remove personal trinkets and family pictures as well as being conveniently absent during a buyer tour.
3. Cosmetics are important:
   • Fresh paint will always add more value than it costs.
   • Clean or new carpet/flooring adds more value than it costs.
   • Landscaping adds more value than it costs. At the very minimum, make the entrance area neat.
   • If you can, add some colorful flowers and new sod.
   • Staging your home with a professional is a great way to sell faster or for more money. Check out staging article and the difference it makes in totally vacant homes.
4. Take care of the obvious! The spot on the ceiling from the roof leak takes thousands of dollars from the perceived value and the offer price.
5. Condition affects value. Do a seller’s home inspection to identify and fix the problem BEFORE closing. No point holding up your check a few extra days; plus a failed buyer’s inspection could cost you the sale. Buyers will often bargain down your asking price to accommodate for property condition and repairs.
6. If you can, remodel/update the kitchen and master bathroom. These two areas have a big impact on home buying decisions. For a few hundred dollars some cosmetic upgrades can truly make a difference in the buyers perception of your home.
7. Strategic renovations impact value and your bottom line. Don’t spend more money to renovate the place than you can recapture in value on the sales price.
8. The AmyBSells Team can help you spend the right money in the right places. Sellers are not getting back 100% on their upgrades and added features in this market, so we want to be sure you are doing the repairs that make a difference (not the ones that don’t matter) and get your home SOLD faster and for the most money!

• Home Improvement , Housing Market , Improvements , Listing , Staging , Value
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Amy March 1st, 2008

It’s hard to ignore the recent gloomy talk on the national news about the slumping housing market in the formerly hot markets of Florida, Nevada, Arizona and California.

With all of this doom and gloom, the natural instinct is to roll up the driveway, shutter the windows and wait for the financial storm to blow over. But now is not the time to lock yourself in the basement. Here in Cincinnati we have Spring!

As a buyer watching rates and sitting on the fence . . .”would you rather buy a home a day too early, or a day too late?”

It’s time to get serious – before an inevitable rise in interest rates wipe out your advantage. The thing that will make make home prices stop falling is the very same thing that will push mortgage rates higher.

Some members of the financial press are starting to suggest that a bottom is near, and that buyers should get out and start looking for bargains in homes. Time Magazine ran a piece this week titled, “Ignore the Headlines!” by Dan Kadlec, where he notes that Fed rate cuts always “lift the economy eventually.” He also makes the case the buying a home today will beat waiting another year even if home prices drop an additional 10 percent.

To buy a $218,900 home at 5.5 percent is $994.31 a month. To buy next year at $197,010 at 6 percent will cost $994.94. The irony is that in the time Kadlec did his research and when the magazine came out, interest rates were already back over 6 percent, making his example all the more compelling.

You just never know, but you may not save anything to wait when there are great deals to be had today in today’s market.

• Buyers , Housing Market , Trends
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