Posted by Annalisa Burgos | April 2, 2009
As they say, April showers bring May flowers. And in real estate, it seems like all the elements are in place for a perfect storm heading into the prime Spring season.
News headlines are proclaiming “falling home prices” and “interest rates at record lows.” Throw in record levels of foreclosures on the market, and you’ve got a trifecta for a Spring homebuying spree.
We already started to see the trend in February, when the National Association of Realtors’ reported a 5.1 percent jump in existing home sales, citing a surge in distressed home sales. And with the latest S&P Case-Shiller Home Price Index showing home prices in 20 major cities down 19 percent from a year earlier, this trend is likely to continue.
Speaking of home prices, what are today’s sellers supposed to do when trying to price their homes? Yes, they’re supposed to be using comps to determine fair market value. But if you’re competing with foreclosures, short sales and just desperate (er, motivated) sellers, it screws up the whole paradigm. Not sure if you can really call all this “fair.” Unfortunately, that’s the reality of selling in this market. So if you have no choice but to sell now, buck up, get realistic, research what’s happening in your market and try these tips on how to price your home to sell, courtesy of FrontDoor Insider and San Diego Realtor Kris Berg. And real estate guru Barbara Corcoran shares her top 4 must-do tips, including one on pricing your home.
Home values aren’t what they used to be. But the ways to determine home value won’t change. Sellers, get back to the basics and check out FrontDoor’s Home Seller’s Guide, specifically steps 7 and 8.
And buyers, we’ve got tips for you too. FrontDoor’s Top 10 for April features our Top 10 Bargain Markets for Homebuyers. And check out steps 9-10 of FrontDoor’s First Time Homebuyer’s Guide. Just because prices and interest rates are falling doesn’t mean everything is an automatic bargain. You’ve still got to do your due diligence.
Happy house hunting and selling!
Posted by Annalisa Burgos | March 27, 2009
I’m about halfway through my 75-hour New York state real estate licensing course, and each class gets more and more amusing. It’s like any other classroom setting — you’ve got the students who ask random questions (“why do we need to learn about property insurance?”), students who act like they know everything (“I’m a property manager so I already knew that”), and students who just observe and take it all in (that’s me).
Literally anyone can get a real estate license. All you need is to be at least 18 years old, pay about 500 bucks for 75 hours of training, and pass a school exam and a state exam. No high school or college education required. No hundreds of thousands of dollars in tuition fees. No experience necessary. All you need is the dedication to get deals closed.
The housing boom may be over, but you can’t tell with how many people are clamoring to be real estate agents. And from talking to some of these people, many are looking to capitalize on one of the hottest buying markets in history. Obviously, this is the best time to be an industry insider.
When I lived in Knoxville, my husband and I wanted to buy a house and went house hunting several times a week. Being investors, we were often surprised to find that many of the homes on the market were owned by real estate agents. It seemed like the agents were buying properties from sellers, making superficial fixes and then putting them on the market at a higher price to make a profit, in one word — flipping.
In a recent class, the teacher said flat out, “This business is not about showing houses. It’s about investing in properties and building your wealth. That’s where the real money is.” And true enough, many of the students agreed that that’s why they’re getting their licenses – to get first dibs on bargains and position them for personal gain.
As we continued to talk about things like ethics and good business practices, I’m concerned about the ethical implications. Personally, I think there’s nothing wrong with agents who are in the biz to flip houses. Heck, if I find a bargain, I may do it as well. But where it gets murky is when an agent’s true intentions are hidden behind promises to be true consumer advocates. Like when a seller says he wants X amount for the house but the agent knows it’s worth more and buys it so he can flip it himself. Or when a buyer is looking at a house and the agent tells him it’s a great buy, though he knows it’s a flipped property. Agents who don’t make their intentions clear are at risk when the public gets wise.
The best way for consumers to protect themselves is to arm themselves with their own research and information. That way, they can tell the difference between a true agent and someone who’s just in for the flip. Ask friends and family for referrals and interview at least three agents before choosing one. Get to know the buying process with FrontDoor’s First Time Home Buyer’s Guide, which gives easy-to-follow, step-by-step information from evaluating your finances to closing escrow. We also offer tools to research homes for sale, cities and neighborhoods, recent sales prices, how much mortgage you can afford and more. It’s all incredibly empowering!
With all this information, today’s smart consumer wants a trustworthy, dedicated real estate agent. Even if an agent has his/her own investments on the side, quality customer service is still the benchmark of this profession.
Posted by Annalisa Burgos | March 26, 2009
Now that Twitter is mainstream — with politicians and former naysayers now regularly tweeting (moi, for one) — every industry is trying to figure out how to use this tool to its advantage.
The news industry, for one, is finding it very useful when reporting and finding sources, especially during breaking news events like the terrorist attacks in Mumbai.
Real estate, meanwhile, is still trying to figure it out. Most real estate professionals have a Web site (maybe with a blog) and a Facebook profile, but many will tell you that they are too busy to Twitter or don’t see the value in doing so. After all, if you Twitter four or five times a day about yourself or your brand, don’t you risk diluting your brand, or even worse, turn off people with your constant self-praise?
Yes, and that’s the problem. Companies — real estate and otherwise — shouldn’t be thinking of social media networks like Facebook, LinkedIn and Twitter as straight-up advertising and marketing vehicles, where you plaster your name and expect clients to flock to you. Most people are like me — they’re not going to scour Facebook for a Realtor. But I may tell a friend of a friend that I’m looking to buy a house, and if you (the Realtor) have a relationship with that friend, I may get referred to you.
Think of it this way — you’re at a networking event and you meet that guy who is pushing his business card in your face as soon as you say hello. No one likes that guy. On the other hand, you’re more likely to reconnect with the guy who explained the ebb and flow of mortgage rates to you.
So think broad reach and long-term — think of these social networks as bridges to a ginormous audience, bridges that never existed before, but have the huge potential of helping you build relationships. They are called “social networking” services, not “marketing” services, after all.
Millions of people are on these networks having genuine real estate conversations. Whether it’s a person complaining about the buying process or a seller trying to hawk his home that’s been on the market for 8 months, people are talking about real estate.
And some agents are generating leads by joining these conversations and sharing their expertise, without the in-your-face marketing tactics. Find out how they did it in FrontDoor’s article “Twitter Your House and Friend a Realtor on Facebook.”
Speaking of social networking, you can follow FrontDoor.com on Twitter at www.twitter.com/HGTVFrontDoor and join our fans on Facebook at www.facebook.com/pages/FrontDoorcom/18669721826.
Posted by Annalisa Burgos | March 24, 2009
It looks like it’ll be a promising Spring for real estate. Buyers are back in the market, drawn to falling home prices, low interest rates, potential bargains in the form of foreclosed homes and short sales, and incentives like the $8,000 first time buyer tax credit. In fact, first-time buyers bought half of the homes sold in February, says the National Association of Realtors.
Of the existing homes sold in February, distressed sales — which involve a foreclosure property or a homeowner doing a short sale — accounted for 40 percent to 45 percent, pushing overall activity up 5.1 percent but dragging median home price down more than 15 percent, according to NAR. Sales are still down 5 percent year-over-year.
Distressed homes typically sell for 20 percent below normal market price, so it’s not surprising to see first-timers drawn to these properties, especially if they are move-in ready or require minimal repairs.
If you’re one of the many bargain hunters out there, check out FrontDoor’s Foreclosure Guide for tips and advice on buying a distressed property. Did you know foreclosure homes sold at auction are typically sold “as-is” and require a 10 percent to 20 percent cash deposit upfront?
The bad news is that sellers are competing with these heavily discounted properties. So even if you have a well-maintained property, you may have a hard time selling it, even if it’s priced reasonably.
Market value is just that — value dictated by the market, i.e. what a buyer is willing to pay for your home. It’s not what you paid for your home. It’s not what you paid for your home and all the wonderful home improvements you made.
The reality is that if your home is competiting against foreclosures and short sales, finding a buyer may end up coming down to price.
Posted by Annalisa Burgos | March 20, 2009
Happy first day of Spring! In celebration of the traditional kickoff to the busiest season for real estate (and this one will definitely be busy, what with interest rates as low as 4.3 percent!), FrontDoor.com is bringing you helpful tips to make the most of your homebuying and selling experience.
Sellers, we know this may be a challenging market, but the good news is that you have the potential to showcase your home to a large number of buyers who are out in force trying to take advantage of low interest rates. If your home is in great shape and priced competitively, you’ll have every buyer’s attention. You may even spark a bidding war. Get your home ready with our Staging Tips for Spring and be sure to visit FrontDoor’s Home Selling Guide for more tips and advice on selling in a buyer’s market.
Buyers, you’re in a wonderful position! There are great deals out there. But before you start looking for houses, call at least three lenders, compare rates and terms, and get a preapproval. It’ll help you determine how much house you can afford. Check out our Home Finance Guide for more tips and advice on shopping for a loan.
If you’ve never owned a home, check out FrontDoor’s First Time Homebuyer’s Guide. We’ve broken down the entire process in simple terms, complete with checklists and worksheets, so you’ll know exactly to expect. Did you know there are cities suited for first time homebuyers?
And buyers and sellers, consider going green in honor of spring. FrontDoor’s Green Real Estate Guide is chocked full of information on how to make affordable green updates and how to find a “green” home.
Happy house hunting and selling!
Posted by Annalisa Burgos | March 3, 2009
HGTV’s real estate site FrontDoor.com is back with a brand new blog!
Tune in for expert tips, tools and advice to help you get an edge in today’s market, whether you’re buying or selling a home.
Get exclusive updates on what’s going on in the real estate industry, from Obama’s foreclosure prevention plan to new requirements for loan modifications.
Take a peek inside some very cool houses for sale, with unique features or by celebrity sellers.
Moving to a new city? Dreaming of living somewhere new? Explore popular neighborhoods and local hotspots with FrontDoor’s city guides.
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Happy house hunting!
Annalisa Burgos
Senior Editor, FrontDoor.com
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