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Tag Archives: honesty

Is this the time to buy your first house?

Saturday, 12 September 2009 17:56
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The effective federal funds rate charted over ...
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Maybe…  Maybe not…

Make no mistake, there are some deals in the market.  And combined with the $8000 First Time Home Buyer Tax Credit (FTHBTC), this can be a great time to buy a first home.  Interest rates have remained low… despite a LOT of predictions to the contrary.  In fact, with a projected deficit THIS year of $1.8T for the federal government, there is still an expectation that rates will have to rise because of the pressure on the available investors.

In fact, that would be the case laid out by those that say THIS is the time.  The FTHBTC is coming to a close on December 1st.  And while that is almost two months away, in the world of home search and financing, two months can go by pretty quickly.

On the other hand…

There are some points that would suggest that for some buyers, waiting a little longer might be just the ticket.  In fact, waiting until AFTER the FTHBTC expires could be a better move for many buyers.

Just as with the Cash for Clunkers program, the tax credit is pushing some buyers into the market that might not have jumped in otherwise.  And we have seen upward pressure on prices for entry level homes.  Buyers, in some cases, are bidding up the prices for some homes.

By waiting until many of the buyers have abandoned the market… after the tax credit expires… there is a belief that prices may drop.  Some think that the drops may be more significant than just the $8000.  They feel that sellers may become quite lonely by January, and may be willing to offer better deals on their homes.

Others have also speculated that there might be a new program from the government to replace the $8000 First Time Home Buyer Tax Credit.  There are plans to offer a $15,000 tax credit, as well as to continue the current offering.  Nobody knows if these plans will come to fruition.

What does it all mean?

For “First Time Buyers” with solid cash resources, waiting may be a better plan.  For those that would be better off paying a little more, but getting the $8000 in a few months, getting on the ball and buying a home soon could be a better way to go.

Don’t forget, “First Time Buyers” are those that haven’t owned a house in the last 36 months.  The credit is for 10% of the purchase price, up to a credit up $8000.  In GA, there is an additional credit of up to $1800 that may be available… even for those that aren’t first time buyers.

If you are looking for a home around Lilburn, GA, give me a call and I can help guide you through the process.

from GwinnettGarageGuy.com

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Broker Fees?

Thursday, 25 June 2009 10:13
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I’ve seen an annoying new trend.  Buyer and Seller “Broker Fees”.  It may go by various names, but amounts to the same thing…  what Clark Howard would call a Junk Fee.

Entrance to Baltimore

Entrance to Baltimore

These are quite different from the other fees that may be involved in a real estate transaction, and there are a LOT of fees.  The lenders have fees, the closing attorney has fees, there are state fees, county fees, insurance fees, delivery fees…  Simply put, buyers and sellers are paying plenty of fees.  Adding some BS junk fee like a paperwork fee, transaction fee, administrative fee or broker fee is just adding insult to injury.

There is already a commission or sales fee that the real estate broker and agent are sharing.  There is no reason to add another official sounding fee on top of this that is after the negotiated amounts.

And, that is how it usually works… the seller negotiates the fee for selling their home, and everyone shakes hands… and then the agent mentions that there is a $495 paperwork fee or something along those lines.  They say it is required… maybe not saying that they are the ones requiring it…

In the case of buyers, after going through the buyer’s agency agreement and telling the buyer that the commission is generally paid by the seller, they hit the buyer up for a transaction fee… again, saying it is a requirement.

There are various reasons for this…  What it mostly comes down to is that people and companies in the real estate industry are hurting for income.  But, many of our clients aren’t exactly rolling in money… and even if they were, it isn’t right to tack on junk just because we think we can… Some agents are working for companies that charge US a closing fee for closing a transaction instead of charging a split and the agents are passing it along.  It should be part of their cost of doing business.

I just say NO!

No additional fees.  You will know EXACTLY what you are paying for my services prior to delivery and prior to completing the negotiations.  I try to deliver more for EVERY client than other agents… but that doesn’t mean I need to add junk fees on top of fair fee structure.

And there are some different options available for sellers… but that is another post.

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But Zillow says…

Saturday, 09 May 2009 23:55
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Well....if nobody wants to play Conkers with m...
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I know… most sellers at some point take a look at the ‘Zestimate’ that Zillow produces for their property.  And there is almost always one of two reactions…

  • “Those people are on crack, my house is worth way more than that” (if the Zestimate is lower than expected)
  • “Wow, I didn’t know it was worth THAT much… Cool” (if the Zestimate comes in higher than expected)

The bottom line is that if it is low, it must be wrong, and if it is high, then it must be right.  It is pretty rare for someone to see a low valuation and think it could be right, or see a high valuation and think it could be wrong…

But let me tell you a truism… the Zestimate is wrong.  Blanket statement.  It could be high.  It could be low.  It isn’t dead on.

Here are the current levels of accuracy for the Atlanta Statistical Area…

Within 5% of the true value, 25% of the time.
Within 10% of the true value, 45% of the time.
Within 20% of the true value, 66% of the time.
Median error, 11.6%.

This is lifted straight from Zillow’s accuracy.  For the Atlanta MSA, you are within 5% once out of 4 times… So, are you telling people that the just gave them a $400,000 valuation, and they have a 25% chance of the house being worth $380k – $420k?  And a 10% chance of it being worth either $$360k – $380k or $420k – $440k?  Or that there is a 10.5% chance of it being worth either $320k – $360k or $440k – $480k?  Or a 34% chance that it is worth less than $320k or more than $480k?

Maybe you will let them know that about half of the time your $400,000 valuation is worth $446,400 or $353,600… since the median error is 11.6%

The thing is that the Zestimate could rise or fall by a significant percentage and still be within the range of error..

So, the thing is that 75% of the time, Zestimates are off by more than 5%.

Now, I am not going to argue with Zillow’s national or regional data.  It is likely to be much closer than the data for a specific property.  The folks there argue (and I can’t refute them in any way) that Zestimates are as likely to be high as low and therefore cancel each other out and that for larger samples, they are quite accurate.

in fact, everyone that gives you an estimate of market value is doing exactly that… giving you an estimate of market value.  Market value can’t be determined until there is a buyer…  That was the previous post…

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Cheap Sex and Real Estate…

Tuesday, 28 April 2009 23:52
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One Night Stand (musical)
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I don’t know why, but I was reminded this morning about two very different people, one quote from both, and how cheap sex is like real estate success… for some.

Back when I first got into real erstate, a local “power agent” told me that the goal was to list as many properties as possible.  She said that I needed systems in place to spend as little time as practical for each listing, and to avoid spending money like the plague.  Seriously. She was all in favor of spending money, but not on marketing property.  Her quote was, “It is a numbers game, the more you list, the more you sell.”  She didn’t care if the houses were over-priced, in bad condition… whatever.  It was just a numbers game.

And then there is a ‘friend’ of mine from my early college days.  He had a pattern… and it worked on occasion.  At a party or a bar or a gathering, he would casually ask girls if the wanted a one night stand.  And every once in a while… he would find one that said, “yes.”  He told me that it worked out to about one in 50 or 75…  It is a numbers game, don’t waste time getting to know people… ask and move on,” he said.  I think it goes without saying that the girls that responded with a “yes” weren’t the girls that the rest of us were looking for…

In both case, these very different people weren’t looking out for the needs of their ‘target’.  They didn’t care about the other person.  An agent that takes an over-priced listing without reservations and then refuses to market it isn’t helping anyone… and someone that will have a fling with anyone that agrees to it obviously isn’t exactly responsible.

But their attitude was the same.  It’s a numbers game. The goals, needs and desires of the client/target aren’t important.  Don’t invest in the relationship.  Meet your personal and selfish needs and/or move on.

I lost touch with the ‘friend’ decades ago.  The agent is still listing property in the area…

Sorry, but I don’t think that is a way to effectively conduct business or personal life.

Is this a bit racy?  Absolutely, but I bet you get the point…

from GwinnettGarageGuy.com

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I don’t want to be ‘Sold’… do you?

Friday, 27 March 2009 21:47
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I was wandering around the web the other day looking at real estate agent web sites… and much like real estate agent ads, there is a theme… a theme I can’t really get on board with.

Skipper Sells Scooterville!

Really?

Did he sell it all at once…

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