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Tag Archives: business of real estate

Photo Friday… Have You Tested Your Lifeboat?

Friday, 15 April 2011 08:12
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Last week for Spring Break, we took a quick cruise.  It was a wonderful time, and the kids were thrilled at all of the new experiences.  And there were a few things that I hadn’t noticed before.

One of them was the crew pulling lifeboats and testing them while we were in port in the Bahamas.  It was a simple thing, really.  The would drop a boat and motor it around for a while, then switch out for a new one.  The ship (from another line) parked next to us was doing the same thing.

Truthfully, it was somewhat comforting.  At the beginning of the cruise, we did the mandatory lifeboat drill.  After parading down from the stateroom, we lined up on the deck, under the lifeboats.  It was nice to know that the next link in the chain was tested regularly, and that the crew had some practice operating them.  The last thing any of us would want would be for the crew to have to read the instructions in order to launch the lifeboat…

And it got me thinking…

Have I tested MY lifeboat?  And the answer is that I don’t really have one.  I am up on the high wire without a net…  Obviously, I need to make some changes to MY life plan.

BTW, it was a gorgeous day and a wonderful cruise.  We were on the Disney Dream, and had a great time.

Wayback Wednesday… Brand New and Foreclosed…

Wednesday, 30 March 2011 08:25
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A couple of years ago, I wrote about a development that was selling brand new bank owned homes.  There seems to be a bit more of that going on now.  I have run across a couple of subdivisions with brand new homes that are being sold by the bank.

One nice thing about a brand new home that is foreclosed is that it shouldn’t have many of the “deferred maintenance” issues that many foreclosed resale homes may have.  On the flip side, many of them will NOT have a builder’s warranty, although some might.  It would depend on if the bank is springing for a good warranty and whether the builder has gone completely out of business (sometimes the foreclose isn’t the result of the builder ceasing operations, but rather a restructuring of debt).  Careful though, some warranties aren’t that great… they might not cover much of the structure (which is why you want a builder’s warranty) for more than a year or two.

Wayback Wednesday… Pics Please!

Wednesday, 23 March 2011 08:53
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DSCN2768

Image by lane.bailey via Flickr

Last year I wrote a post that flippantly compared an eBay listing with an average MLS listing for a home for sale.  Since last year, the number of pictures available in the MLS has gone up.  Last year at this time, the maximum number of pictures was 20, now it is 25.  But, I see very few listings bumping up against the limit of 25 pictures.  Heck, I don’t see many that are touching the old 20 limit.  There are even a lot of listings that don’t make it to 12 pictures, the limit from a few years ago.

I’ve noticed something else, too.  The quality of pictures is going down.  WAY down.  I see more and more listings where the pictures don’t even match the quality from most cell phone cameras.  In fact, I went into a house recently that had blurry, pixelated photos in the MLS.  With my phone I was able to shoot better pictures… at the same angles… as what was published to try to attract buyers to the home.

I don’t understand it.  Study after study shows that buyers want lots of high quality pictures so that they can see the properties.  The want to see the layout of the home and see what types of trim and fixtures are in it.  They want to be able to see the condition.  They even want to see things like HVAC units, crawl spaces, garages and attics.  They use pictures to eliminate properties from the search… or to highlight properties that they REALLY want to get into.

Most of the listings on eBay have better picture representation that most home listings in the MLS.  And it is a pretty sad state when a $5,000 car… or worse yet, a pair of $100 hockey skates… has more pictures of high quality than a $300,000 house.  (BTW, it is homes prices from under $100k to WELL over $2M with crappy photos).

If you are a home seller, you need to DEMAND that your agent have a lot of high quality photos of your house in their listing.  Even ugly houses need to have high quality pictures.  they are buyers looking for ugly houses.  And you won’t make a sale because someone thought your house was a showplace… then got there and found a fixer-upper.  Instead, you will likely push away the buyer looking the fixer-upper.

I’ve NEVER had a buyer tell me that they would have bought the house, but there were too many pictures.  I HAVE had buyers tell me that we should skip a particular house because the pictures were fuzzy and didn’t have any detail… and they were pressed for time.

Get good pics.

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Wayback Wednesday… I was SO wrong…

Wednesday, 09 March 2011 08:36
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Case shiller variation annuelle

Image via Wikipedia

I try to step out on a limb regularly.  Anybody can talk about the past, and what they market did, but figuring out where we are going from here has a LOT more value.  But, if I am going to step out onto the limbs, I am going to be wrong.  And if I am going to be wrong, I have to highlight it and learn from my mistakes.

Last year, I wrote a post highlighting my huge mis-call of the real estate market in 2009.  I expected that the Atlanta market would decline 5% or so… and it went down 20%.  It may have dropped 20% more since then (at least according to Case-Shiller), but I think that a 36% market drop is a little overblown for most of my service area at least.

Even if you don’t want to read it to see how wrong I was, there is a good discussion about the difference in Leading and Trailing Indicators.  It might even be worth the price of admission.

Enjoy.

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Wayback Wednesday… Cram It Down?

Wednesday, 16 February 2011 08:25
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Car upside down.

Image via Wikipedia

Last year I wrote a post about Cram-downs, comparing the pros and cons from a consumer perspective.  And there are both… depending on the specific perspective one wished to use.

  • It can help people that are upside-down if judges can force lenders to write off a portion of the principle balance.
  • For those that aren’t upside-down, it would result in increased borrowing costs as lenders take on more risk.

If you check out the original post, you can see some examples of exactly HOW MUCH the increased costs could be for consumers.

Personally, I think that the bad points out-weigh the good.  In addition to the increased interest rates, commercial borrowers (where Cram-downs are allowed) generally have to provide much higher down payments.  This lowers the risk for lenders.

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