Real Estate News and Views

Get real with your home prices… and you will sell your home!  There are many homes lingering on the market causing a decline in values as we all know it.  When the home is on the market and it is getting too few showings or no showings at all, it is priced too high, period.  When a home is on the market and it has many showings and no offers or offers that are priced well below (even in this market), it is too high, period!

Unrealistic expectations is usually the culprit, yet it could be a denial of the market we are in.  It is amazing how many sellers I speak to that are shocked in the decrease of the values.  We aren’t in the market we were in in the early to mid 2000’s.  Many times there is a $$$ figure in mind and to say that “I want to get out of it what I’ve put into it” just isn’t realistic.  A question I ask many clients is, “When you put that in or installed that did you do that for your own use and pleasure or for the use and pleasure of the next buyer?”  Let’s just say they thought ahead, ok then, “What if the next buyer doesn’t like X, and they decide to get rid of it as soon as they move into the home, how much value is it to them then?”  Again, unrealistic expectation of the “value” of something…  I’d like to get the full value of the $40,000+ pool I installed, and I saved money contracting it out myself!  I’ll get about half…

Buyers are savvy and no longer allowing emotions to be the judge, they are comparing prices, value, and are looking for a “deal!”  There may be some “shoppers” out there but overall buyers are really doing their homework and with good reason.  Agents are getting in on the “get real” bandwagon also.  When working with buyers, I show the best of the best on the market for two reasons:  1. I don’t have time to see every home that is out there. 2. My clients don’t have time to see every home out there and they get confused when shown too many just like I do.

If you are getting showings with no contract…TOO HIGH.  If you aren’t getting showings… TOO HIGH.

Get real with your home prices, you’ll be glad you did and you will sell your house before your neighbors do

A sluggish economy accompanied by a declining job market has influenced the sluggish housing market to the point that buying a foreclosure has become a “hot topic” for discussion.  While most may think these homes are in really bad condition and because of that they can be sold so much less than a typical resale home, this isn’t always the case in this market.  You’ll find many foreclosure homes are in much better condition than you’d expect.  One thing’s for sure, banks are wanting to sell off these assets due to the tremendous cost of holding them month after month.

The process a bank uses to determine value of the home is simple, they have “several” pricing opinions given to them.  They use a Realtor, usually the listing agent of the home, to determine a broker price opinion and then they have an appraisal(s) done and with that they determine a market value price to set on the home and proceed with marketing of the home.  Because of the bad publicity of the condition of many foreclosure homes, banks are now taking the time to “clean up” the homes they sell as much as they can.  You’ll remember in recent news headlines several states are fining banks who allow their properties to become a blight on the communities they are located in.  Home owners associations are also increasing their standards on the allowable condition of foreclosures in their respective neighborhoods.

 Several factors to consider in purchasing a foreclosure are:

• Be approved for your loan prior to house hunting, you’ll need an approval letter if you submit an offer
• Hire a Realtor in the area you are looking to purchase your home in
• The condition of the major systems in a foreclosure home are unknown to the bank so there won’t be any disclosures on the home as in a typical resale home
• There might be missing systems such as exterior HVAC components - the SEER rating of HVAC units went up to 13 SEER several years ago, confirm the unit is up to the new SEER rating since it is a high cost item to replace
• Have an idea of what it will cost to bring the home to “average” condition/uniformity to the neighborhood and use that figure in determining the value of the property
• Most foreclosure homes are priced at or below market value so remember that also
• When you decide to make an offer and there are other offers (multiple bids) make sure your offer is the BEST offer, the best is not always the highest…  your Realtor will help you with the offer terms - write an offer that shows the bank you want the home, not the other way around…
• Expect to wait several days to receive a response, if the offer is turned in over the weekend remember banks are not open weekends so it may go into the following week a few days
• The asset managers at banks have hundreds of properties they manage, they are going through the offers as fast as they can
• The offer must be in the name of the person(s) buying it
• Banks don’t pay for surveys and they don’t normally offer home warranties, they will pay closing costs depending on the offer itself
• If you have the winning offer be prepared to follow the contingency dates very closely, any deviation from these could result in not closing and losing your earnest money
• If there will be a delay in closing be sure it is for a legitimate reason, yet also realize you may be required to pay a per diem per day you are late, usually $100 per day
• Closing day is always a great day, yet with a foreclosure home, the day the closing takes place may not be the day it funds so you may not be able to take possession immediately, it make take a day or two depending on the bank that has the property
• Change the locks immediately upon taking possession, the lockset on the doors has had access by others

Buying a foreclosure isn’t as bad as it seems, these homes will create many memories for your family just as any other resale home will, you just need to remember these tips and you’ll find the buying process to be a smooth one!

For more information call my office direct at 832-482-6033 or visit my website at www.michelleallen.us and I’ll be glad to answer any questions you have.  I am a certified Foreclosure Specialist and can help you in your next purchase.

Red Day was a great success!  I participated in Keller Williams Red Day in Galveston, Texas on May 14, 2009.  I joined several hundred agents in the process of clean up, planting and other hurricane Ike necessities the island we’ve all gone to and loved needed to replenish itself.

It was rather emotional as I drove down and got past Nasa 1 Road and was able to see the remnants of the scattered boats that my son was talking about.  There were still signs of clean up that was under way and building that was being done to make the island beautiful.  While Galveston may not have the clear pristine seas as some other nationally known beaches it is still home to many in the Texas landscape that come to get away from it all and play in the sand and burn their butts!

 I’m glad I was part of this great day and had a blast with my fellow Woodlands and Magnolia agents.  Part of the Keller Williams culture is to “give back” to the communities in which we are part of.  There isn’t any other company I know of that goes the distance that Keller Williams does when it comes to community service and volunteering.  That is one of the reasons I joined this great team.

Giving back is vitally important, and we are called to do good works as part of our faith.  We all have spiritual gifts, knowing that gift and fulfilling it are not only important but rewarding as well.  Volunteering is something anyone can do and must do to help our communities.  Take note of those businesses in your community that “give back” and make it a point to do business with them - they really are trying to make a difference, you should also make a difference by giving them your business.  Then, perhaps, other people and other businesses will take notice and do the same…

 Just something to think about..

Your credit score is all about you and there are ways to improve it.  Your credit score will make or break you when it comes to qualifying to buy a home or anythng else for that matter.

You can take steps now to fix or increase your credit score. 

Start with your credit report from the three credit bureaus, be sure to get one from each because they all account for your credit worthiness:
Equifax  www.equifax.com    800-685-1111
Experian  www.experian.com    888-397-3742
Trans Union  www.transunion.com    800-888-4213

Once you receive these reports check to make sure the name is spelled correctly, your social security number is recorded properly and your birth date and previous addresses are also correct.  This may seem elementary but beleive me these items are found to be wrong all the time and they add items that don’t belong to you, affecting your score…

Next, ensure the account numbers are correct - there are a variety of other items to look at:  items that may be your spouse prior to your marriage, bankruptcy debts that were wiped off at time of bankruptcy, items that aren’t yours.  You’ll also want to make sure that inquiries made about yoru credit are ones that you authorized.  You can also go to www.myfico.com and request a credit repor there.

Dispute the errors by contacting the credit bureaus directly.  They will investigate the error with the creditor and report back to you within 30 days.  If the item is incorrect they will delete it from the report.  If the item is caused by your negligence or late payment it won’t be removed… 

 Here are some ideas to improve your score and they all make a difference:

• Pay your bills on time - just one late pay will make a difference, especially within the past year - make a list of your bills and their due dates.  You can auto debit from your account if you aren’t good at paying them on time, you can even set up online bill payment and pay them when you are ready.
• Pay down your debt as much as you can - a good rule of thumb is stay below 30% of the credit limit on cards or other revolving accounts.  This will not only increase your score but put more money in your pocket due to less finance charges
• Charge less and don’t go over that 30% mark - paying off monthly isn’t affected by this if the charge is during the time the credit is reported to the bureaus.
• Keep your current accounts open even if you aren’t using them.  By shutting these down you are lessening the total available credit to you.  Another thing, the older the account the better.
• Don’t open new accounts.

Magnolia commercial real estate is “hot!”  Montgomery County, Texas is very marketable, still selling very well and at close percentage to list price.  The area is not affected as the rest of the real estate market.  Part of the lure for commercial real estate opportunities in Montgomery County is the knowledge that people are still moving to the area in droves.  They love the country nature yet the ample shopping that is in close proximity and the highways for downtown commute.  Montgomery County is the first county that approved “pass-through” financing and you see the prime example of it isn the widening of FM 1488 and the quickness of the completion of that roadway.  Properties sitting on FM 1488 have seen upwards of 50% explosion in pricing over the last several years!  Houston market is supposed to double by 2030, i.e., we’ll have over 8,000,000 people living around the metroplex.  Where will all these people go?  investing in commercial properties now and either holding on to them or reselling in just a few years will make you more money than the stock market will.

It is my belief and has been for over a year that the market will start turning around in general at the end of 2009 - notice the economists are now saying the same thing…  My recommendations to anyone out there who has the money is to invest in real estate now, prices are very low, even for the commercial opportunities, and hold the property and make $20,000 - $50,000 profit in the next 4 years!

I offer commercial investment analysis on any properties that I work with clients on, whether selling or buying.  If you just have general questions and or would like a market snapshot of commercial property, or residential for that matter, give me a call.  I’m always glad to help! 

Welcome to Michelle Allen’s Blog! This blog will provide you with valuable information, tips, and general insight into the real estate market in Montgomery County and surrounding areas, including Northwest Harris County.  I hope you come back often and please comment on any post - I always appreciate feedback.  You are welcome to link from my blog with permission and I’ll do the same!