Real Estate Blog
Tuesday, February 17 2015
The foreclosure situation is a good deal different from what we were discussing a few years ago when the tidal wave of 7.3 million foreclosures and short sales swept the nation. When The New York Times “Dealbook” recently pronounced that the supply of cheap foreclosed homes in America is dwindling, it came as news to…well, no one.
Let’s face it: investors wouldn’t need to look up the latest statistics to guess that number of offerings would be down. The continuing rebound in home values, slow but steady improvement in the overall economic picture, and even just the passage of time has to mean that the glut of subprime-crisis-era foreclosures would have worked their way through the system.
But there are always new foreclosures, and for anyone hoping to make a bargain buy in today’s foreclosure market, the same qualities that brought post-crisis success still apply today:
- Knowledge of (or willingness to research) comparable neighborhood values
- Realistic appreciation of rehabilitation costs
- Decisiveness (willingness to act swiftly)
- Ready access to investment capital
The principal difference in today’s foreclosure milieu is that far fewer are available, and the difference between market value and listing price has narrowed. There may be fewer competitors to worry about, but some are still out there, as always. Today sees fewer institutional investors—in fact, some are leaving the market altogether, taking their profits and selling out to groups more committed to long-term property management.
Aside from the qualities described, there is still no blanket formula for landing the best foreclosure deal. But among other observations, there are two that are worth considering.
First, despite the lessening of the impact institutional investors previously had on the market, it may still be necessary to prepare to offer more than the listed price. The dwindling number of foreclosed homes tends to create an imbalance between supply and demand. If other buyers are offering higher amounts than the asking price, it can easily result in a bidding war situation. As always, by researching underlying values, the best investors avoid foreclosure buys that wind up being little more than break-even propositions.
Another wrinkle to be aware of is the possibility of future cost increases. For instance, it can transpire that an investor succeeds in purchasing a property significantly below its true value, only to find that a reassessment by taxing authorities raises its property tax bill through the roof! Canny investors prevent this surprise by finding out how the local Assessor’s office sets rates and schedules appraisals.
The foreclosure picture changes constantly. If you are interested in the investment possibilities—or are looking for a buy on your next home—don’t hesitate to give me a call to discuss the latest offerings! You can reach me on my cell phone: 812-499-9234 or email Rolando@RolandoTrentini.com
Wednesday, January 28 2015
Despite the improving economic outlook, for many families, finding an affordable house can still be a challenge. According to a study by the Joint Center for Housing Studies at Harvard University, more than a third of today’s families have had to devote at least 30% of their combined household income to the monthly mortgage payment—and that figure exceeds the generally accepted standard. In other words, even though mortgage interest rates remain pegged at historically low levels, landing an “affordable” house (just as in the rest of the country) can take some doing. Here is one five-step approach that has rewarded house-hunters in the past:
1. Define Affordable House in dollars
The first step to finding an affordable house should be to work out a target budget. The Wall Street Journal currently recommends spending no more than 28% of monthly income on your house). Make sure to include additional fees such as legal fees, repairs, maintenance, and closing costs in your calculation. The bottom line you come up with isn’t one set in stone, but it’s a reasonable goal to have in mind.
2. Set space requirements
Space will be a prime consideration for the entire time you'll be living in your home. If you are planning on expanding the family in the near future, having a spare room is close to a necessity. If it's just something that would be nice to have, it’s not a requirement—and recognizing the distinction can be all-important.
3. Balance travel time against housing costs
Often you can offset the purchase price of a home by expanding your search radius to include a reasonable commute. Get out your pencil: you'll need to compare the savings in the house payment against the additional cost of an extended commute.
4. Include properties that need some TLC
One of the best ways to zero in on an affordable house is to keep an eye out for otherwise-eligible "fixer-uppers." You can avoid any serious structural problems, such as plumbing, electrical, and roof issues, yet still focus on properties that just need a little cosmetic revamp can put you across the affordability finish line.
5. Investigate home buying programs
In a limited number of instances, there are some generally underpublicized home buying programs that might be available. For instance, there is the Good Neighbor Next Door program. For teachers, medical professionals, firefighters, and law enforcement officers looking in revitalization areas, as much as a 50% discount from a HUD-listed property can make a house more than affordable!
Most observers believe residential prices are likely to continue to rise—so it’s not outlandish to suspect that today’s affordable houses may become less so as time passes. Give me a call if you are thinking of taking advantage of this winter’s bargains in our area. You can reach me on my cell phone 812-499-9234 or email: Rolando@RolandoTrentini.com
Thursday, October 30 2014
You’re about to close a deal to become a tenant. The landlord seems like a straight shooter and the place is a joy: immaculate and welcoming. Now all that’s left is to wait for the landlord’s okay after an evaluation of you as the new tenant, right?
Well, not quite. Just as the landlord should check financial or job references as part of their due diligence, you have some to perform for your own benefit. It’s up to you to assess the landlord’s system to determine whether this rental arrangement is the good fit you hope it is. Only by asking pertinent questions can you decide whether the landlord’s management style and expectations align with your needs.
1. Do you offer emergency maintenance services?
When a plumbing leak becomes uncontrollable or the heater goes out on a cold winter night, you need maintenance assistance quickly. Find out how quickly your landlord can respond—and how readily he or she answers. An experienced landlord is familiar with the inevitability of maintenance emergencies—and isn’t surprised (or put off) by the question. A great landlord is confident of the system he or she has put in place!
2. What are my maintenance responsibilities?
Lease language can be less than precise about the tenant’s responsibilities—most often when it comes to outdoor areas. A lease might vaguely state that the tenant is responsible for general lawn maintenance. Ask your landlord to pinpoint the specifics, and jot down notes that you can refer to later. Some landlords might expect mowing the lawn and weeding planted areas; others might expect you to attend to more, such as lawn treatments. Finding out your landlord’s specific expectations will give you a sense of the upkeep requirements for your end. It can’t help but minimize the possibility of any future conflict.
3. Is there a homeowners association?
As a rental tenant, most likely you won’t be responsible for any homeowners association dues. However, you might be subject to its rules and regulations. For example, if the association has strict lawn care requirements and you are responsible for garden maintenance, you should know about those details. If your landlord answers yes to this question, ask for a copy of the association rules.
4. What are my responsibilities before I vacate the property?
It’s not being overly negative to bring up the subject of the end of your tenancy. When you move out of a rental home, you want to leave the property in good condition so that you are not hit with any charges—or see your security deposit disappear without good reason. Find out if your landlord has any specific requirements, such as professional carpet cleaning or filling the holes in the wall.
5. How do I contact you on nights and weekends?
Problems with your rental unit do not always occur Monday to Friday, 9 to 5. By asking your landlord for contact information during non-business hours, you get a sense of how accessible he or she is. If he or she willingly gives you a cellphone number, you’ve probably found a landlord who will be easy to work with— and easy to track down should problems arise!
My work as a Realtor® lets me help set the stage for tenants and landlords to create a mutually beneficial relationship. If you are looking to purchase an income property taking advantage of this fall’s very favorable terms, don’t hesitate to give me a call! You can reach me on my cell phone 812-499-9234 or email: Rolando@RolandoTrentini.com
Friday, October 17 2014
Market Watch October 2014
I have a lot of interesting information and statistics for this month’s Market Watch, but before I start that discussion I think I should share some basic real estate concepts. First, basic economic concepts apply to real estate. For example, increased supply results in decreased demand, which lowers prices. Conversely decreased supply results in increased demand, which increases prices. The catch to this basic principle is that other factors such as the general state of the economy, the job market, interest rates and consumer optimism also affect prices as well as buyers and sellers desire to buy or sell homes. With this most basic background let’s now explore some interesting trends in the market.
First, according to The Wall Street Journal, new home sales (as opposed to previously owned homes) were at their highest level in August since May of 2008. These sales were up 33% compared to August of last year. Although this is clearly good news, I think we should view this in context of very low new home construction over the past few years. Good numbers in August suggest full year totals of between 400,000 and 450,000 new home sales for all of 2014. Although this is clearly an improvement from less than 250,000 sales a few years ago, it still falls far short of the 1 million new homes that sold at the height of the real estate boom. Increased new home sales have left only a 4.8 month supply of new homes on the market.
A second fact, according to RIS Media, is that prices increased for the 30th consecutive month when compared to the previous year. This statistic seems pretty clear. Home prices continue to rise at what has remained a pretty steady pace. The median price of a home nationwide is now $219,000.
My third fact, again according to RIS Media is that in the 2nd quarter of 2014, 950,000 homes returned to a positive equity situation, meaning that these homes are now worth more than the outstanding mortgage balance on those homes. As you may recall, when the real estate market was adversely affected by the last recession many homes nationwide lost value and owners owed more in mortgage loans that their homes were worth. RIS claims that as of today, 14.9% of homes nationwide are still in a negative equity situation but that represents 2 million fewer homes underwater than just a year ago.
I think we can draw several conclusions from this data. First, the real estate market is on sound ground and continues to improve. Second, new home construction continues to recover. Third, prices continue to rise slowly. And finally inventory levels are still lower than normal and there is demand for more listings.
All of the information in this month’s Market Watch is national data although I believe that the same trends I’ve just discussed apply locally. As is always the case with real estate, demand and price for homes is always specific to one individual home. Please give me a call if you would like to discuss the value of your house or the home you are considering buying. You can reach me on my cell phone 812-499-9234 or email: Rolando@RolandoTrentini.com
If you want to do some research before we talk, the most accurate information on our local real estate market is always at FCTuckerEmge.com.
Wednesday, June 04 2014
Homeowners who had been bracing themselves for sharp rises in mortgage interest rates must now be scratching their heads. As the online Mortgage News Daily put it last week, “…rates have been extraordinarily sideways, and right in line with the lowest levels in 11 months.”
Since historical averages are still significantly higher, it’s no wonder that most observers still believe the greater likelihood is for rate increases. But recent Fed happenings show a crack in their avowed determination to let that happen by tapering off purchases of mortgage-backed securities. The hemming and hawing is notable. It’s all pretty much up in the air.
In any case, one thing I can guarantee is that mortgage holders will benefit if they take advantage of savings opportunities when they present themselves. Among current possibilities—
1. Refinance Your Mortgage
Mortgage holders who haven’t already refinanced should at least consider doing so. Refinancing means taking advantage of the still historically low interest rates—often the most meaningful step in reducing your monthly mortgage payments. Before deciding to refinance, make sure that the mortgage costs involved will be less than the resulting savings. If you agree with the prevailing wisdom that it’s unlikely we will see a significant drop in interest rates in the near future, today’s levels still look inviting.
2. Cancel Private Mortgage Insurance (PMI)
According to the National Association of Realtors®, mortgage down payments have fallen over the past decade. Their figures show that the average mortgage down payment in 2013 was 10% – compared with 16% just ten years earlier. Homeowners who put down less than a 20% deposit are typically required to take out Private Mortgage Insurance. But once the Loan-to-value (LTV) ratio falls below 80%, homeowners can ask for the PMI insurance to be removed—and they should, because the lender isn’t responsible for keeping track of that for them. If you are close to the 20% threshold, it may be worthwhile to make a one-time payment that will reduce the principal below 80%.
3. Extend the Length of the Mortgage
Many homeowners have made significant reductions in their principal by opting for shorter-term mortgages. But should rising interest rates make a property you are trying to buy unaffordable, extending the length of the mortgage can reduce monthly payments to a more comfortable level. Although over the long term this will end up costing significantly more in interest, moving from a 15-year mortgage to a 30-year can sometimes be the right move—especially when the property at stake represents one of the terrific values currently out there.
While interest rates in Evansville may rise or fall or, as we’ve seen lately, hold surprisingly steady, sudden leaps or plummets are unlikely…and with a little preparation, unpleasant future surprises in interest rates are avoidable. Thinking of buying a home in Evansville this summer? Call me today to start laying the groundwork! You can reach me on my cell phone 812-499-9234 or email Rolando@RolandoTrentini.com
Wednesday, May 28 2014
When Evansville residents hear about floods, images of homes tumbling into the sea or half-submerged along the banks of a raging river probably leap to mind. But the risk of flooding isn’t confined to those headline-grabbing catastrophes—which is why the recent passage by Congress and signing by the President of the Homeowner Flood Insurance Affordability Act (HFIAA) will be of interest to many people thinking of buying a home.
Sellers are required by law to disclose if a property is in an officially-designated flood zone; and banks typically check this information as well. While it can certainly be off-putting to be informed of this when buying a home, the availability of flood insurance can keep it from being a deal-breaker. But “available” doesn’t necessarily mean “affordable”—which is where HFIAA comes in.
Many prospective homebuyers are only vaguely aware that flood and water damage are not covered under traditional homeowner policies, something that’s newly relevant when buying a home. Part of the reason is because only 5% of the U.S. population lives in an officially designated “Coastal Flood Plain”—so it’s not a much-discussed issue in most parts of the country.
But the coastal areas that do get attention whenever disaster strikes are not the only kinds of flood plains that are relevant. FEMA assesses and maps areas that are subject to flooding, and assigns them letters denoting the likelihood of flood damage. Some of the provisions of the new HFIAA deal with overhauling those procedures, but the most immediately significant parts deal with (you guessed it) cost.
Here a little history will be helpful. In 1968, the National Flood Insurance program was created to help some property owners secure insurance in areas where it had been prohibitively expensive. But, as one might expect, the cost of the program soon became a problem. That in turn triggered passage of another Act—the Biggert-Waters Flood Insurance Reform Act of 2012—intended to allow premiums in covered areas to rise to offset their real costs.
The new HFIAA now partially reverses that yet again, because policy-makers fear the effect on the housing market. The new act delays some of the price rises for four years and allows homeowners who sell their homes to pass the lower premiums on to the new homeowners. It’s also relevant that there are two different types of coverage available: dwelling only and dwelling/property. Although dwelling only coverage is cheaper, as you might expect, there’s a good reason: it doesn’t cover the personal belongings that a flood could destroy.
Some zones, like Zone X, are as inexpensive as a few hundred dollars per year. The zones that flood more regularly can run into thousands…and all flood insurance premiums are in addition to the regular home insurance costs. For those buying a home in an area where properties might be classified as within a flood zone, it’s a good idea to check with one of the local insurance companies that offers flood coverage. When all is said and done, only you can decide if it’s worth the risk or not.
If you are thinking of buying a home in this summer, flood insurance is only one of the details you’ll want to consider. Call me today and we can begin by putting together a list of your search criteria. You can reach me on my cell phone 812-499-9234 or email Rolando@RolandoTrentini.com
Friday, May 09 2014
Market Watch April 2014
As you may be able to tell from your allergies, spring has certainly sprung in Southwestern Indiana. The real estate market is heating up right along with the warmer temperatures. We are witnessing a significant increase in sales activity and anticipate that will continue through the spring. Lawrence Yun, the chief economist for the National Association of Realtors, said a gain was inevitable, following a dismal winter. (We certainly agree here!) On a national level, showing activity is increasing and sales activity is expected to follow suit as more inventory reaches the market. And in our office, the homes that are priced right and in good condition are getting lots of attention and in some cases, multiple offers.
The key challenge will continue to be inventory. We continue to see a shortage of homes for sale, with inventory rates near record lows. While this shortage will drive an increase in median existing-home price, continued positive momentum is dependent on the availability of homes for sale. Opportunity’s knock is getting louder on the doors of potential sellers, who at this point will dictate the performance of the local housing markets for the next couple of months.
While need for listings is high, sellers must present a home that is in good condition and priced right. Working with a real estate agent from the beginning ensures you have a knowledgeable professional that knows the market and can help get your home sold in the shortest amount of time.
If you’ve considered selling your home, now is the time. With many active buyers, you don’t want to miss this market surge! And if you’re ready to buy, I’d encourage you to visit www.TheTrentiniTeam.com , where you can use our interactive map search to perfectly define your search area. Until next month!
Tuesday, May 06 2014
Mortgage rates may rise or fall this spring (lately they seem to be falling!)—but that needn’t prevent you from saving even more money when it’s time to structure your own mortgage. The underpublicized fact is that mortgage rates are only one of the factors that affect how much you wind up paying. No matter what happens to mortgage rates in 2014, here are some keys to making mortgage decisions that result in significant savings:
Tailor the term
Evaluate your budget and see whether it is possible to increase the amount of your monthly payment. By increasing monthly repayments, you reduce the term of your mortgage. Over the course of the loan, this can save tens of thousands of dollars.
Refinance for five years instead of two
The interest you pay on a refi loan isn’t the only cost. The origination and other fees can easily end up costing four figures. It’s a numbers game: simply calculate the anticipated savings from refinancing, then subtract the amount of the fees. The difference tells you your net savings…and demonstrates why one of the easiest ways to grow those savings is to refinance less frequently.
Change to biweekly
Changing to biweekly payments instead of monthly payment can save you more than small change. The reason is on the calendar: there are 52 weeks in a year, but only 12 months. If you make 26 1/2 payments every year, that equates to 13 monthly payments. It’s a stealthy way to make an additional month’s payment every year without really noticing it. When choosing a loan, opt for one where the bank allows you to choose biweekly payments (as long as they don’t want to charge an additional fee). Also request that the extra payments be deducted from the principle.
Improve your credit score
On this count, every mortgage guru sounds like a broken record. Although the average quoted mortgage rate may rise or fall, that’s not necessarily the rate that you pay. Your FICO score is the primary determinant of your mortgage rate. The difference between a good FICO score and a bad one can be significant, so get a copy of your credit card record and challenge any damaging inaccuracies. Lenders want to see a long history of paying on time with a mixed use of credit.
Mortgage rates will almost certainly increase in the future because they’re still well under historical averages. But there are plenty of steps you can take to cut thousands of dollars from your ultimate mortgage costs. And if you are ready to buy a house in this spring, contact me today—I’m ready to show you what’s coming up at your price point! You can reach me on my cell phone 812-499-9234 or email Rolando@RolandoTrentini.com
Monday, April 21 2014
Buying a home in Evansville is sort of a modern day adventure. At first there’s the intrigue of figuring out the advantages and disadvantages between the neighborhoods and listings competing for your attention; then there are all the challenging, sometimes exhausting—then, ultimately, exhilarating steps that lead to home ownership.
But even after the previous owner has handed over the keys, there’s more to come: a few extra steps new homeowners can decide they wish to take. Here are five of those—things you can choose to do after buying a home:
#1 Change the Locks
Who knows how many people have a copy of those keys? It’s a good idea to change the locks on all exterior doors, because it’s not just the previous owners who have had access to the property; there may also have been guests or tradespeople with access to the keys. By installing new locks, you can be sure that you are complete control of the keys to your new home.
#2 Have the House Cleaned
While the previous homeowners are obliged to leave the home in reasonable condition (usually “broom clean”), consider scheduling a professional cleaning crew before you move in. If your budget and schedule allows, it can be a plus to know some serious deep cleaning has been performed on counters, plumbing fixtures, carpets, etc.
#3 Smooth Transfer of Utilities
After buying a home, it’s usually possible to transfer utilities into your name without having to live through a break in service. Contacting all utility companies ahead of time will ensure that the transfer is orderly and scheduled in a manner that will be convenient to your move. It’s also an opportunity to be sure that utility bills have been fully paid before closing on the property.
#4 Store the Settlement Papers
At the end of the process of buying a home, a host of details come fast and furious, making it doubly easy to misplace things—even important things, like copies of the papers you execute during settlement. Later, when it’s tax time (or in the future should you sell the property), you’ll save yourself a lot of desperate rummaging if you’ve prepared a secure place to keep them from the start.
#5 Take Photos of Your Household Items
It’s important to keep an accurate list of your household contents in the case of theft, fire or other mishap—records to act as verification of your belongings and their condition. Buying a home is the perfect time to take that inventory. Go from room to room snapping digital pictures of everything you own. It will never get easier!
Like anything worth doing, buying your new dream home probably came with its own set of stresses. But it should stand as one of the most rewarding financial moves you will ever make. If you’re thinking of buying or selling a home in Evansville this spring or summer, do give me a call! You can reach me on my cell phone 812-499-9234 or email Rolando@RolandoTrentini.com
Wednesday, March 26 2014
It just might be that a groundswell is spreading throughout the home-buying public. In Evansville, smaller houses that used to be difficult to sell are rising in popularity, and I can guess why.
First, a little history. Back in 1950, what we would consider smaller houses were the rule: the average square footage came in at just 983 (try to imagine the ‘average’ family with 2 kids, 2 adults and Lassie all shoehorned in there!). By 2006, that figure had blown up to 2,248 square feet—and we all know about the bigger McMansions—just in time for the financial meltdown. Within the next few years, for the first time ever, the upsizing trend had begun to reverse. Only three years later, average square footage was 2,135.
In terms of size, today’s buyers and sellers are meeting in a much more balanced market. Smaller houses are no longer automatically spurned. In fact, smaller houses are the first choice for a growing number of buyers. Why?
When you really analyze it, a surprising amount of housing space is seldom used. Lifestyle changes dictate that formal dining and living rooms are much less frequently occupied. And it’s a fact that we only use a small percentage of the things that we own, so in actuality, some of many homes’ area amount to extremely high-end storage space. By getting rid of some of that unused stuff, the space it takes up can become unneeded.
The old rule of thumb nationally is that property taxes average about 1% of the value of a home. Smaller houses mean lower tax bills.
Maintenance bills can be substantially lower in smaller houses. It varies greatly by age and style, but one estimate has it that annual maintenance bills usually run between 1%-3% of total value.
Whether your hire help or handle it yourself, a smaller home can be much faster to clean. This may be less true when clutter is allowed to take over, but for those who are vigilant clutter-clearers, it means freeing more time for doing the things that you love. If you are paying someone else clean your home, it can easily equate to significant savings over the course of a year.
According to the American Psychology Association, money is the largest single contributor to stress. Nearly three-quarters of Americans admit that financial problems are their biggest source of stress. Purchasing a smaller house with an accompanying smaller mortgage can directly translate into a mellower quality of life.
A smaller house may not be for everyone, but today’s buyers are considering the advantages with a much more open minds. If you are giving some serious thought to buying or selling a home, let’s talk about the wide range of possibilities on the local market today. We are experiencing very low inventories right now. This plays out to the advantage of sellers. You can reach me on my cell phone 812-499-9234 or email Rolando@RolandoTrentini.com
Wednesday, February 05 2014
One of the unusual situations that sometimes crops up in real estate is one where the buyer purchases a house without ever seeing it. This may sound nuts—but there are circumstances (more than you’d think) where it can be the only practical solution.
Wholesalers and house-flippers, for instance, sometimes simply haven’t time to visit every property they suspect is a great buy. Other times, buyers might be relocating to Evansville from out of state (or even out of the country) under a timetable that doesn’t allow them an extra visit—or even a first visit! According to the latest full-year data from the National Association of Realtors®, home sales to foreign buyers amounted to $68 billion!
As you’d guess, the risks of purchasing a house sight-unseen when relocating to Evansville remain stark. Nonetheless, there are ways such buyers can protect themselves:
Adding a contractual walk-though contingency—one which allows a final walk-though before signing at closing—is the surest protection. Sellers aren’t obligated to accept such a contingency (and in a competitive market it’s less likely to be acceptable), but if it’s allowed, it’s also a sign that the property is likely to pass muster.
The odds of a good “sight-unseen” result when relocating to Evansville grow significantly better when you present your agent with a clear list of requirements. Some important factors outside of specific house metrics could be the quality of local schools, transportation links and commuting times, crime rates, shopping and entertainment and recreation area access.
It is especially important to hire a first-class home inspector. When you can’t visit the property yourself, your inspector can be the trained eyes that prevent your inheriting unneeded maintenance issues. If the listing doesn’t give you a clear idea of how the home is laid out, requesting a video of both interior and exterior of the property is a good idea. If one isn’t available, don’t be shy about asking your agent to make a walk-through video for you.
For anyone relocating to Evansville when a ‘sight-unseen’ home purchase is necessary, choosing the best-qualified Realtor and inspector couldn’t be more important. In that situation, they become your ears and eyes on the ground! Please feel free to call me at 812-499-9234 or email Rolando@RolandoTrentini.com and I will be more than happy to assist you with your real estate needs. Our motto is “With an Accent on Service”
Tuesday, November 12 2013
Conventional wisdom dictates that home sellers prefer cash offers. So what is a typical would-be buyer in Evansville to do when the competition comes forward with an all-cash offer? Cash offers may come from any of a variety of deep-pocketed parties: institutional investors, foreign investors, wealthy families or individual investors.
Beyond doing basic due diligence — gathering as much intel as you can about the property and the seller’s needs — if you’ve found the perfect home and are convinced it is the best property for your family, consider one or more of these tactics:
Bidding over asking — even by as little as 2% or 3% — can sometimes win the day, according to Noah Rosenblatt, founder of Urban Digs, a real estate analytics company. Cash buyers typically factor in opportunity costs, making it less likely that they will go beyond a certain price threshold. No one wants to pay more for a property than necessary, but going “over asking” may be the only way to secure an ideal property when cash offers are competing.
Removing any contingencies from your offer will help strengthen your position and may well convince a local seller that you are the party most likely to close successfully. The downside is that you will be assuming whatever risk had been the subject of the contingency in the first place. For example, if you were to submit an offer less any inspection contingencies, you might have to pay more than budgeted down the road if undiscovered repairs crop up.
The seller’s goal is maximize net return, so any term you add that puts more money in the seller’s pocket can sway the decision in your favor. Creative thinking pays. You might offer to pay the seller’s closing costs, cover your own Home Warranty policy, or any other add-on that has the desired effect.
While cash may be king in most cases, there are ways to compete with cash offers in Evansville. If you are looking for an agent with constructive solutions to help you find and secure the right property, why not call me today to take advantage of this fall’s inventory? You can reach me on my cell phone 812-499-9234 or email Rolando@RolandoTrentini.com
Monday, November 11 2013
When you step outside and feel a crisp chill in the air, you know it: winter is on the way. If events have so ordered themselves that you find yourself selling your home in Evansville during the winter months, you’re probably aware that it is not the preferred real estate season. Prospects are less likely to be out and about touring properties when the weather can interfere; the holidays take huge chunks out of everybody’s schedule (not to mention the havoc wreaked on family budgets) — plus, the aura of optimism that arrives at springtime won’t arrive until far in the future…
Nonetheless, selling your home during the winter months is eminently doable! In fact, because fewer offerings will be competing for the quite determined corps of would-be homebuyers, selling your home during the winter months can actually yield an outstanding result. Veteran sellers know how to maximize that prospect:
1. Advertise with spring or summer photos
Showing what your house looks like when the weather’s prettiest will be warmly received. Don’t rely on prospective homebuyers’ imaginations to do it as well.
2. Make your home cozy
Selling your home in Evansville during the cooler months is actually an opportunity to show it at its “homiest.” Light the fireplace; turn on all the lamps; bake those chocolate chip cookies (or light scented candles — cinnamon is a holiday favorite).
3. Fine-tune the thermostat
People are turned off when a home feels chilly — just as they appreciate stepping into a warm and cozy listing (especially if they were just touring a vacant home).
4. Set a reasonable asking price
If you are going to be selling your home in Evansville during the approaching holiday season, it’s not the best time to “test the market.” Selling in a timely manner requires pricing the property accurately. You want to motivate the serious buyers to take a break from holiday obligations to turn out to view your house.
If you’ve been contemplating the idea of selling your home in Evansville, know that there will be winter buyers out there. Call me today — let’s find them! You can reach me on my cell phone 812-499-9234 or email Rolando@RolandoTrentini.com
Friday, October 18 2013
Even though local property prices continue to recover, the current market can still present challenges. No one understands this better than homeowners who are re-listing this fall. For some of them, surrounding seas of “For Sale” signs created a less-than-appealing neighborhood setting. Others drew buyers who weren’t able to secure financing in the uncertain mortgage environment. Whatever the reason, it can be disheartening for anyone who has to re-list their property.
Once you undertake a repeat attempt to sell your home, you want to be certain the job gets done right. A key part of that will be ensuring successful showings. It’s estimated that well-staged homes sell as much as 50% faster than those not “dressed for sale.”
Most buyers begin their search online, so take a look at its online marketing. A buyer who dismisses your property outright without a visit means one less chance to close a sale. Be sure you show multiple photos that show the property in the best possible light. If that's not the case, and professional photography might provide the solution.
Give the property another thorough cleaning. You cleaned your home for your first open house, but now that time has passed, your house certainly needs deep cleaning again. In particular focus on the two areas that get messiest fastest: bathrooms and kitchen rooms buyers look at first.
Take a look at timing: specifically, the times you choose to show your home. Try holding an open house between 3-5pm. This will make your home one of the last that prospects view. If they are still looking at day's end, chances are they are serious about buying a property. This slot also helps avoid viewing conflicts with other homes.
Sure, it's disappointing any time a home doesn't sell immediately, but that needn't mean it won’t succeed the second time around. In most parts of the country, real estate has been trending upwards and more buyers are entering the market. You're only looking for that one person who appreciates your property. Ready to get a fresh start? Then call me: let's get going! You Can reach me on my cell phone 812-499-9234 or email at Rolando@RolandoTrentini.com
Tuesday, June 25 2013
On Thursday, Bloomberg’s online news service confirmed what we had been hearing in more general terms: “Sales of previously owned U.S. homes climbed more than forecast in May…and prices jumped, indicating more progress for residential real estate.” Agents here in Evansville would also not have been surprised at the national surge in selling prices “by the most since October 2005”. If you were already inclined to sell your own home, it looks more and more as if this summer will be a propitious time to jump on the opportunity.
As real estate agents gear up to maximize the market’s improvement, homeowners are also weighing some of the more popular alternatives for boosting valuations when it comes to selling —
- Prospective homebuyers are increasingly energy savvy, so when new appliances need to be updated prior to sale, the more energy-efficient they are, the more worth highlighting they will be. Real estate agents know how to emphasize a property’s ‘green’ attributes.
- If you have an attic or a basement that is currently serving little purpose, conversion can pay off. Basements are often the more affordable option since they call for little structural remodelling. Conversions can be into a games room, office, or utility area. Attics are often best converted to bedrooms or office space (or at least staged to suggest the possibility).
- In Evansville, real estate agents love to offer properties with decks — especially in the summertime. If you are prepared to engage in a little DIY, adding a deck can be among the most cost-effective of improvements. According to HGTV, the cost of a professionally built deck starts at about $15 per square foot, with more elaborate installations featuring costly hardwoods or composite materials running closer to $35.
Even if you do not intend to sell, a little extra money invested in your home may be a dollar-wise idea. Thoughtful investments can enrich your own living experience AND attract higher prices when the time comes to move on. If you’re looking for a real estate agent in Evansville, call me today to go over other improvement ideas. You can reach me on my cell phone 812-499-9234 or Rolando@RolandoTrentini.com
Monday, June 17 2013
The graduations are just finishing up, most summer getaway are booked, and with the end of June soon to be coming our way, many homeowners may be thinking more about holiday weekends and BBQs than home maintenance. But for those selling a home this summer, keeping ahead of upkeep issues will become an important part of the project. Some items that bear watching:
The best time to clean air conditioners is before you fire them up for the first time…but since the AC always seem to be needed sooner than expected, few of us do. Never mind: sooner is better than later — and if you're selling your home in Evansville this summer, you'll want to keep the home comfortable at all times for potential buyers. Your owner's manual should explain how to change filters and clean coils and fins.
Everyone knows how important clearing clutter is for selling your home, but don't forget to stash the winter's heating paraphernalia. While you’re storing any portable heaters, pull the filters from the central furnace and pick up replacements next time you’re at the hardware store. When potential buyers see the new replacements neatly placed where they’ll be handy come winter, they are likely to register that this is one property owner who is well ahead of maintenance issues.
Cleaning the windows and window coverings is a chore none of us looks forward to. But when you're selling your home in this summer, few touches pay off like windows that shine, shine, shine! Choose one of our sunny days and see if you can get someone to work with you — and if you can spare an extra hour or so, hose off the screens and lay them out in the sun to dry.
Selling your home in Evansville is less taxing when you put yourself a step ahead on maintenance. Then call a hard-working agent like me to put the rest of a well thought-out marketing plan into action. I’ll be working all summer to help bring you top dollar for your home. You can reach me on my cell phone at 812-499-9234 or email: Rolando@RolandoTrentini.com
Thursday, May 03 2012
More home owners want more space in their kitchens and are expanding the kitchen’s use for more than just cooking, according to the latest findings from the American Institute of Architects’ quarterly Home Design Trends Survey. The survey, conducted in the fourth quarter of 2011, focused on kitchens and bathrooms.
“Kitchens seem to be regaining their function as the home’s ‘nerve center,’” says AIA Chief Economist Kermit Baker.
During the housing downturn, kitchen design fell as a priority for home owners, Baker notes. But as the market has picked up, Americans’ interest in kitchens has been renewed.
“The last few years have seen kitchens take on new functions with dedicated computer areas and recharging stations,” Baker notes.
The kitchen products and features growing the most in popularity, according to the survey of architects, are:
1. Computer area/recharging stations
2. Integration with family space
3. Renewable flooring materials
4. Recycling centers
5. Adaptability/universal design
Home owners are also placing more emphasis on sustainability in choosing products in the kitchen, such as with renewable flooring materials and renewable countertops increasing in popularity.
Sustainability is also important in bathrooms, the survey found. One of the biggest growing concerns for home owners in designing bathrooms is finding ways to minimize utility costs, according to the architect survey. As such, products like LED lighting, dual flush, and water-saving toilets are growing in demand, Baker notes.
Tuesday, January 31 2012
January’s typical Evansville homebuyer assumes that buying a pre-owned residence saves money. Period. And in fact, most often that is true. Buyers rightly expect that pre-owned houses are more affordable than comparable new homes for sale. But what about the buyer who can qualify for a slightly higher mortgage? Would it be a better idea for them to also consider new homes for sale rather than to simply fixate on the immediate cash savings that go along with buying an older property?
The fact is, there are both benefits and drawbacks that deserve looking at no matter which choice you wind up making.
One practical advantage to buying new homes for saleis that you know that you and your family will be living in a house built to conform to the latest standards in materials and construction. Evansville building codes are continually adopting advances in energy efficiency and materials sustainability. They automatically reflect the community’s experience with construction techniques: what works and what doesn’t; what lasts longest; what’s safe. With contractors and inspectors both working the insure that new homes for sale are built to code; the result is an extra dose of peace of mind when it comes to the durability you can expect in a new home.
Another advantage to buying a newly built house is the pleasure and convenience of living in a home with brand new features. No time-consuming and costly remodeling will be needed to obtain the extra pride of ownership that go with a sparkling new kitchen and bathrooms boasting the latest fixtures. And it’s often the case that newly-built homes for sale better reflect today’s lifestyle patterns. Twenty-first century floor plans apportion space in ways that agree with most people’s living preferences, so new homes for sale in today’s market are more likely to accommodate modern entertainment systems (just as they frequently leave less space for gigantic dining room tables).
In contrast, one disadvantage to purchasing some of the new homes for sale can be a tradeoff in lot size. Though not always the case, older developments sometimes reflect an earlier era which accommodated smaller populations featuring less crowded landscapes.
Of course it’s your budget that will largely determine which combination of neighborhood and new or pre-owned home that will make the best fit for you and your family. The wisdom of planning carefully before investing hard-earned money in any property goes without saying. Since you are looking forward to many years of occupancy in either a pre-existing or new home for sale, I hope you will contact me for a consultation. I know the area and can help you sort out the choices that are available right now. You can call me at 812-499-9234 or you can email me at Rolando@RolandoTrentini.com
Friday, January 13 2012
If you’re one of the millions who has an eye on 2012 as the year in which you’ll buy a home (first or not), here are five things you can do now to put yourself on the right path:
1. Check your credit. Take my word for it: there is no bad surprise worse than a bad credit surprise. Okay, maybe there is one thing worse – a credit surprise you receive while you’re in the midst of trying to buy a home!
Recent studies have revealed that a record high number of real estate transactions are falling out of escrow, and that credit “issues” are a leading cause of these dead deals. Your best chance at catching and correcting score-lowering errors and other derogatory items before they destroy your personal American Dream is to start checking and correcting while you still have time on your side.
2. Do your research. The more rapidly the real estate market changes, the more it behooves smart buyers to study up before they jump in. And now’s the time – you can start doing online and in-person research into topics ranging from:
· Target states, cities and neighborhoods. Whether you’re relocating or simply trying to narrow down the local districts to focus on during your 2012 house hunt, December is a great time to start your online research into decision-driving factors like tax rates, school districts, neighborhood character and even prices in various areas. Resident ratings and reviews sites like Trulia and NabeWise can help you make the neighborhood-lifestyle match.
Once you narrow things down and start speaking to local agents, ask them to brief you on the local market dynamics, including how long homes typically stay on the market and whether they generally go for more or less than the asking price, so you can be smart about how you search. (And yes, there are areas where homes sell for more than asking, even as we speak!)
· Real estate and mortgage pros. If you don’t already have your pros picked out, now is the time to get on the horn or drop an email or Facebook message to your circle of contacts, asking them for a referral to a broker or agent they love. Follow up by: checking whether these pros are active in answering questions on Trulia Voices, searching for their name and seeing what sort of feedback on them you can cull from the web, then giving them a ring and launching a conversation about whether you and they might be a good partnership.
· Short sales and REOs. Distressed property sales are not for the unwary. If you want to target upside down or foreclosed homes, or are planning to house hunt in an area where many of the listings are described as short sales or foreclosures, get educated about what you can expect from a distressed property purchase transaction before you get your heart set on a short sale.
· What you get for the money. Online house hunting is a powerful tool – especially when it’s cold and wet! But there comes a point in your house hunt where you’ve got to just get out into the actual physical homes you’re seeing online in order to get a strong, accurate sense of what home features, aesthetics and location characteristics correlate with what price points.
· Mortgage musts. You can read a bunch of articles about mortgages and get yourself pretty far down the path toward qualifying for a home loan, but you can only get a personalized action plan for a smooth road ‘home’ by talking with a local mortgage broker and having them assess your basic financials. They might say you need to move funds around, pay a bill down or off or produce some sort of documentation from your employer. And the time to start all that is now.
3. Fluff up your cash cushion. So, you’ve saved up your 3.5 percent down payment. Perhaps you saved a little extra for closing costs. Or maybe you’re even one of those uber-aggressive 20-percent-down-ers. No matter how much you’ve saved, you’ll find that you could use more once you activate your home buying action plan. Mark my words – after closing, you’ll crave extra cash to do some repairs, upgrade a couple of things, buy appliances or even just to hold onto in order to minimize your anxiety about depleting your savings!
4. Shed some stuff. Sell it. Donate it. Give it to relatives who’ve always coveted it. Just get rid of it. You might even be able to kill three birds with one stone: (a) getting some cold hard cash to go toward your savings, (b) getting some tax receipts to help you out on your 2012 tax returns, (c) clearing the mental clutter that physical clutter creates and (d) getting a long head start on preparing for your move, affirming your commitment to your home ownership goal.
5. Sit very, very still. Sometimes, the best way to further our goals is to stop tripping ourselves up. In that vein, commit right now to refrain from making any major financial moves until you buy your home. Don’t quit your job to start that personal chef business (yet), don’t pull a bunch of cash out of your savings account (without getting clearance form your mortgage pro first), and don’t start buying cars (or anything else, for that matter) on credit.
Wednesday, May 04 2011
If your house is on the market then you might be at the point of tearing your hair out. After all, some sellers have had their home up for sale for years at this point. It can be maddening, and the competition is only getting more intense as prices continue to fall and more foreclosure homes flood the market.
So what, exactly, are buyers looking for this spring? In short, they're looking for homes that are going to save them money. And when you think about it, it just makes sense. Mortgage loans are harder to come by, and thanks to an uncertain economy, people are less likely to splurge on a McMansion they're going to have to pay to heat and cool for the next five years (i.e. save money on utility bills).
[See the best personal finance stories from around the Web at the U.S. News My Money blog.]
Even if you're planning on staying in your home the next few years, it's still helpful to know what people are looking for because you're likely going to make changes and home improvements over the years. Knowing what potential buyers are interested in can help you invest your money wisely, so you have a better chance of selling when you're actually ready. So what are people looking for?
1. Homes in Good Condition
Buyers aren't interested in fixer-uppers right now. They don't have a lot of cash, and they don't want to spend money on home repairs immediately after they move in. They're looking for homes that are in great condition and that are absolutely move-in ready. They don't want to have to repaint, clean carpets, or cover up cracks in the ceiling. And they especially don't want to spend money on major repairs. To increase your chances of an offer this spring and summer, make sure you do everything you can to get your home in tip-top shape. Utilize a house spring cleaning checklist and make your home spotless before showing it off.
2. Homes with Green Features
Saving money and living green are trends that aren't likely to disappear anytime soon. Buyers are now looking for features which are going to cut down on a home's operating costs, as well as lessen its impact on the environment. Tankless water heaters, high-efficiency furnaces, energy-efficient appliances, energy-efficient windows, adequate insulation, and solar panels are just a few that are making it on to buyers' wish lists.
Basically, any "green" upgrade that's going to save money on utility bills will be highly appealing to people looking for a new home. You probably don't want to splurge on solar panels, a geothermal furnace, or other expensive green energy technologies, but there are some small changes you can make that will help potential buyers save money in your home. For instance, you could install a rain barrel or two against the house, add insulation, upgrade any old appliances to Energy Star rated models, and plant some trees to help with shading during the summer months.
[In Pictures: 10 Smart Ways to Improve Your Budget.]
3. Outdoor Living Spaces
In an uncertain economy, people travel less. This means that our homes are truly becoming our castles, no matter how small they are! Outdoor living spaces have always been popular, but they're especially appealing now since so many people are taking staycations, and choosing to relax at home instead of going out at night and on weekends. If your backyard leaves a lot to be desired, then do whatever you can to turn it into an oasis. Build a deck, plant flowers, add a fountain, and turn it into an escape for potential buyers.
If your home is currently on the market, it's important to do everything you can to remove any concerns buyers might have about your house. Sellers sure don't want to continue spending money on their homes, but small changes such as planting flowers, repainting, and cleaning can go a long way towards getting you an offer. Remember, you don't want to give people any reason not to buy your home!
Have you had any success selling your house in this market? What are some of the best methods that worked for you?
Heather Levin is a regular contributor to the Money Crashers personal finance resource site and is also the creator of The Greenest Dollar, a blog focused on green and frugal living.
Wednesday, April 13 2011
If you remember the Market Watch I sent in December, I made several specific predictions about how our local real estate market would perform the first several months of this year compared to last year. Those predictions have been accurate to-date but what is probably more telling is how we are doing compared to 2009. As I have mentioned before the homebuyer tax credits in the first half of last year distorted sales. There were no homebuyer tax credits in the first half of 2009. Closed sales in the first three months of 2011 were up 11.7% in units and up 18% in total sales dollars compared to the corresponding period in 2009. The local housing market has improved and will continue to get better.
The number of active listings on the market continues to stay at historically low levels. Housing affordability which is influenced primarily by the price of homes and interest rates is at historically high levels. If you are thinking about buying, waiting will inevitably mean you pay more for your home, either in terms of price, interest rates or both. If you are thinking about selling, it is better to get your house on the market now before inventory levels begin to rise.
If you are selling your home, it is important to understand that buyer behavior has changed significantly in the past few years. Now virtually all buyers look at homes online before physically visiting a house. In other words showings happen online. Today the number of times a home is viewed online is as, or more important than the number of physical showings and is a better barometer of buyer interest. Seller reporting at FCTuckeremge.com provides sellers a realistic picture of marketing activity. This tool allows you to know when and how often potential buyers are looking at your home online. Call me if you have additional questions about this valuable program.
Let me know if I can help you with any of your real estate needs and please enjoy the beautiful spring weather that has finally arrived. You can reach me at 812-499-9234 or Kathy at 812-499-0246.
Wednesday, November 10 2010
1. Decide what you can afford. Generally, you can afford a home equal in value to between two and three times your gross income.
2. Develop your home wish list. Then, prioritize the features on your list.
3. Select where you want to live. Compile a list of three or four neighborhoods you’d like to live in, taking into account items such as schools, recreational facilities, area expansion plans, and safety.
4. Start saving. Do you have enough money saved to qualify for a mortgage and cover your down payment? Ideally, you should have 20 percent of the purchase price saved as a down payment. Also, don’t forget to factor in closing costs. Closing costs — including taxes, attorney’s fee, and transfer fees — average between 2 and 7 percent of the home price.
5. Get your credit in order. Obtain a copy of your credit report to make sure it is accurate and to correct any errors immediately. A credit report provides a history of your credit, bad debts, and any late payments.
6. Determine your mortgage qualifications. How large of mortgage do you qualify for? Also, explore different loan options — such as 30-year or 15-year fixed mortgages or ARMs — and decide what’s best for you.
7. Get preapproved. Organize all the documentation a lender will need to preapprove you for a loan. You might need W-2 forms, copies of at least one pay stub, account numbers, and copies of two to four months of bank or credit union statements.
8. Weigh other sources of help with a down payment. Do you qualify for any special mortgage or down payment assistance programs? Check with your state and local government on down payment assistance programs for first-time buyers. Or, if you have an IRA account, you can use the money you’ve saved to buy your fist home without paying a penalty for early withdrawal.
9. Calculate the costs of homeownership. This should include property taxes, insurance, maintenance and utilities, and association fees, if applicable.
10. Contact a REALTOR®. Call me at 812-499-9234 for all of your Real Estate needs. You can also rech me by email: Rolando@TheTrentiniTeam.com
Wednesday, September 29 2010
A real estate purchase is one of the best investments you can make — so be certain to protect your land ownership against possible title problems that can hinder the transfer and marketability of your real property. These problems are defects and occur before the date of the policy and remain undisclosed until sometime later. Even the most thorough search of the public records cannot reveal some the "hidden" hazards.
A one-time premium will safeguard your property from actual loss and defense costs (unless specifically excluded), up to the policy amount, resulting from any risk covered by your policy. A mortgage policy protects only your lender against tide defects. Purchasing an owner's policy of tide insurance will protect your interests. Title insurance covers tide defects such as:
1. Forged deeds, mortgages, releases of mortgages and other instruments.
2. False impersonation of the true owner of the land or of his consort.
3. Instruments executed under fabricated or expired power of attorney (death).
4. Deeds apparently valid but actually delivered after death of grantor or grantee, or without
consent of the grantor.
5. Deeds by persons of unsound mind.
6. Deeds by minors.
7. Deeds not properly delivered.
8. Deeds that appear to convey title but are really mortgages.
9. Outstanding prescriptive rights not of record and not disclosed by survey.
10. Descriptions apparently, but not actually, adequate.
11. Duress in execution of instruments.
12. Defective acknowledgment due to lack of authority of notary. (Acknowledgement taken
before commission or after expiration of commission)
13. Deed or property recited to be separate property of grantor, which is in fact, community or
14. Deed from bigamous couple. (Prior existing marriage in another jurisdiction)
15. Undisclosed divorce of spouse who conveys as sole heir of deceased consort.
16. Undisclosed heirs.
17. Misinterpretation of wills, deeds and other instruments.
18. Birth or adoption of children after date of will.
19. Children living at date of will but not mentioned therein.
20. Discovery of will of apparent intestate.
21. Discovery of later will after probate of first will.
22. Administration of estate and probate of wills of persons absent but not deceased.
23. Conveyance by heir, devisee or survivor of a joint estate who murdered the decedent.
24. Deed from trustee of purported business trust, which is in fact, a partnership or joint stock
25. Deed of executor under non-intervention will when order of solvency has been fraudulently
procured or entered.
26. Deeds to or from corporations before incorporation or after surrender, or forfeiture, of
27. Claims of creditors against property conveyed by heirs/devisees within prescribed period
after owner's death.
28. Mistakes in recording legal documents. For example, incorrect indexing, errors in
transcribing and failure to preserve original instrument.
29. Record easement, but erroneous ancient location of pipe or sewer line, which does not
follow route of granted easements.
30. Special assessments where they become liens upon passage of resolution and before
recordation or commencement of improvements for which assessed.
31. Want of jurisdiction of person in judicial proceedings.
32. Failure to include necessary parties in judicial proceedings.
33. Federal estate and gift tax liens.
34. State inheritance and gift tax liens.
35. Errors in tax records. For example, listing payment against wrong property.
36. Ineffective waiver of tax liens by tax or other governing authorities repudiated later by
37. Corporation franchise taxes as lien on all corporate assets, notice of which does not have to
be recorded in the local recording office.
38. Erroneous reports furnished by tax officials, but not binding on municipality.
39. Tax homestead exemptions set aside as fraudulently claims.
40. Lack of capacity of foreign personal representatives and trustees to act.
41. Deeds from nonexistent entities.
42. Interests arising by deeds to fictitious characters to conceal illegal activities on the premises.
43. Deed in lieu of foreclosure set aside as being given under duress.
44. Ultra vires deed given under falsified corporate resolution.
45. Conveyances and proceedings affecting right of servicemen protected by the Soldiers and
Sailors Civil Relief Act.
46. Federal condemnation without filing of notice. Federal law does not require filing of notice
of taking in local recording office.
47. Break in chain of title beyond period of examination or public records where running of
adverse possession statue has been suspended. True owners are incompetent, absent or
incarcerated or the sovereign holds title.
48. Deed from record owner of land where he has sold property to another purchaser on
unrecorded land contract and the purchaser has taken possession of premises.
49. Void conveyances in violations of public policy: payment on gambling debt, payment for
contract to commit crime or conveyance made in restraint of trade.
Friday, August 13 2010
Market Watch For August 2010
Two months have passed since the expiration of the homebuyer’s tax credit and we’ve had time to see how the market would react. As I predicted, we did see a decline in closed transactions from May and June levels as a result of a decrease in written transactions from the previous months. And while the news isn’t great, it’s better than expected. July brought an increase in written contracts up 37% from May and up 22% from June. I believe July written contracts are more representative of the remainder of the year than either the spectacular numbers we saw in March and April or the depressed numbers we saw in May and June.
The tax credit has expired, but there really has never been a better time to buy. I mentioned briefly last month that interest rates were attractive but I don’t think many potential buyers realize how much more house the same payment buys today than it did not long ago. Thirty year fixed rates are now about 4.25%. On a $100,000 loan that monthly payment (before taxes and insurance) is only $492. That is $75 a month less than the payment at 5.5% and $140 a month less than the payment at 6.5%. Buyers can buy the same home and have more money in their pocket or buy a bigger home with the same payment. Either way rates are great and will not stay at this level. Don’t miss your chance to take advantage of this opportunity.
While you are shopping for your home don’t forget that TuckerMobile.com allows you to search for any listed home from any smart phone. It is easy to search by price, address or MLS number and you can save your search results. Please call me at 812-499-9234 if you have any questions.
We would like to take this opportunity to congratulate Kevin Eastridge Broker/Owner of F.C.TuckerEmge Realtors this year’s recipient of the Realtor of The Year 2010 Award.
Enjoy your Labor Day weekend and I’ll update you again next month.
Thursday, June 10 2010
The Federal Reserve’s periodic survey of economic conditions, known as the Beige Book, this week reported growth in all 12 regions for the first time since 2007.
Here’s what the Beige Book had to say about real estate:
Boston. Commercial real estate leasing was flat in some areas and noticeably improved in others.
New York. Commercial real estate leasing has picked up noticeably although vacancy rates continue to rise in some areas. Residential rents appear to have bottomed.
Richmond. Residential real estate markets are improving with the inventory of homes in the Washington, D.C., suburbs falling to its lowest level in 18 months.
St. Louis. Commercial and industrial real estate activity remaina slow, but the suburban office vacancy rate increased in Little Rock; Louisville, KY; and Memphis. It was flat in St. Louis.
Minneapolis. Home construction is rebounding with building permits in the Minneapolis-St. Paul area doublinf year-over-year in May. Vacant commercial real estate increased in Minneapolis.
Kansas City, Mo. Home sales rose, but practitioners are less optimistic about upcoming months.
Dallas. Housing demand has improved, but bankers say many potential borrowers are being turned away because of poor credit.
Source: Associated Press, Christopher S. Rugaber (06/09/2010) http://www.realtor.org/RMODaily.nsf/pages/News2010061001?OpenDocument
Saturday, May 29 2010
If you’re renting out your home, it might not be covered by homeowners insurance, so look into landlord insurance instead.
Maybe you’re moving up to a bigger home and holding on to your former residence as a rental property. Or maybe you’ve tried to sell your home without success. Whatever the reason, if you’re thinking about renting out your home, you need to look into landlord insurance.
Homeowners insurance covers your house if it burns down, your possessions if there’s a break-in, and medical and legal bills if someone gets hurt on your property. Problem is, homeowners insurance might not offer protection if you decide to rent out your home. Landlord insurance does. Set aside half a day to research policies.
Renting out your home raises risks
Homeowners insurance typically covers owner-occupied, single-family residences, says John W. Saunders, president of Slemp Brant Saunders, an independent insurance brokerage in Marion, Va. When your home doesn’t meet that definition because it’s being rented out regularly, it’s no longer covered.
Most homeowners policies will cover an occasional short-term rental if, say, you’re going away for a few weeks, says Dave Millar, a partner at Riley Insurance Agency in Brunswick, Me. “But if you have a summer home you’ve decided to use as an income property and are putting different people in there every week,” he explains, “that’s a lot higher risk for the insurance company.”
The risk is also higher for both you and your insurer when you rent out your home on a full-time basis. You have an increased responsibility for injuries on the property, whether to your tenants or your tenants’ guests, says Bob O’Brien, vice president of Noyes Hall & Allen Insurance in South Portland, Me.
Insurers also experience more claims on tenant-occupied properties because tenants typically don’t care for properties as well as owners would. Renters are less likely to either identify or report maintenance needs, says O’Brien, and may be unfamiliar with a home’s systems like the location of the water shut-off.
Look into landlord insurance
When you decide to become a landlord, inform your insurer and ask about a specific landlord insurance policy, sometimes known as a dwelling fire policy or special perils policy. Coverage from a basic landlord policy isn’t quite as broad as a homeowners policy, says O’Brien, but it includes big risks like fire, wind, theft, and ice damage.
There are several levels of dwelling fire policies: DP-1, DP-2, and DP-3. The higher the number, the better the coverage. “A DP-3 policy might provide replacement cost on the house and theft of contents coverage for your belongings,” says Millar.
Expect to pay about 25% more for landlord insurance than you did for homeowners insurance, according to the Insurance Information Institute. In recent years the average cost of homeowners insurance was $822 a year. Tack on 25%, and that would put the average annual premium on landlord insurance at about $1,025.
A landlord policy covering a one-year rental for a home in Maine insured for $370,000 and personal property for $10,000 would cost $1,170, for example, says Millar. Expect to pay even more if you allow short-term rentals. The same insurance for the home if rented by the week for 12 weeks during a year would be $2,170.
Other insurance policies to consider
Landlord insurance typically covers the house itself, other structures on the property such as sheds, the owner’s possessions (but not the tenant’s possessions), lost rental income if the house is damaged and uninhabitable, and some liability protection for the owner in case of injury or a lawsuit. Policies vary, however, so read the fine print. If lost rental income isn’t included, you might be able to add the coverage for an additional $50 a year, says Saunders.
Also consider an umbrella policy that provides additional liability protection beyond the limits of your landlord policy. “If you’re talking about owning more than one house, and your net worth is starting to build up, then you should consider an umbrella policy,” says O’Brien. You can usually get an additional $1 million worth of liability coverage for $250 to $300 a year.
Finally, O’Brien advises that you require tenants to buy renters insurance that protects their own property. Remember, landlord insurance only covers the owner’s property. In recent years, the average cost of renters insurance has run $182 annually.
Wednesday, May 26 2010
Renting out your house can be a smart financial move, as long as you calculate your costs carefully.
You have a single-family house you’d like to rent out. Perhaps you’re temporarily relocating for work, or maybe you inherited your childhood home from your parents, and you’re not quite ready to part with it yet.
Renting can be a profitable choice, but it requires an investment of time, money, and organization to make it work. Here’s how to determine whether renting out your house is worth the cost.
Calculate your monthly expenses
You want to charge at least enough to cover your monthly outlay. So the first step is to use our free downloadable worksheet to calculate your costs. Start with regular expenses like mortgage, maintenance, and homeowners association dues.
You may also need to upgrade your insurance coverage. Your agent can advise you about adding landlord insurance, a special type of policy that covers rental properties. As a rule, landlord insurance costs about 25% more than standard homeowners insurance.
If you’re renting the house furnished, make sure you’re covered for the personal possessions you leave behind. Jane Cline, the insurance commissioner of West Virginia, tells owners to prepare a detailed inventory of household items. If you’re renting the house unfurnished, figure in the costs of moving and storing your items.
Check out prospective tenants
As a practical matter, you’ll have to formally check out your prospective renters. MrLandlord.com, an information and service site for landlords, suggests a variety of background checks: credit reports, eviction reports, and criminal background reports. None of these is expensive, but you must get your prospects’ permission.
MrLandlord.com charges $8.95 for an eviction report. A combined credit and eviction report is $14.95. If you want to be especially careful, a countywide criminal report costs $29.95.
Account for maintenance and upgrades
Even with the most scrupulous checks, you can’t be completely sure renters will take good care of your home. Eva Rosenberg, an enrolled agent in Northridge, Calif., advises that if you’re not within easy driving distance of your rental property, you’ll need to arrange for someone else to keep an eye on the place, even if it’s just to make sure the lawn is mowed. If the tenants are neglecting upkeep, you’ll want to know about it sooner rather than later, since it could be a warning sign of trouble down the line.
Of course, even if the renters are conscientious, problems can crop up: boilers will fail; roofs may leak; washing machine hoses can burst. If household systems or appliances need repair or replacement, you’re better off spending the money up front, before the fix becomes an expensive emergency.
You may also want to invest in some of the “extras” that Sue Peters, a broker in Wellfleet, Mass., recommends adding to attract a tenant willing to pay a higher fee. She suggests spending money on air conditioning, expanded-channel cable TV, and a Wi-Fi network.
Don’t want the headaches? Hire a property manager
You can save yourself a lot of time and effort if you engage a management company to oversee the property and take care of the details. Some firms charge a percentage of the rental fee, others a flat monthly fee, based on the extent of services. Joe Aimone of GoRenter in Phoenix, Ariz., says his firm offers a variety of services, starting at as little as $50 a month, including general maintenance, rent collection, and—if necessary—eviction.
A management company can help you figure out how much to charge, find and vet tenants, and prepare a lease. It will also pay the real estate taxes on your behalf and present you with an annual 1099 form. Many management companies maintain 24-hour emergency lines and a roster of approved service people, so they can take care of plumbing or electrical problems and bill you later. A property manager will also see that driveways and sidewalks are shoveled, so you don’t find yourself with an unpleasant claim against your liability insurance.
Expect to pay a management company 8% to 10% of the annual gross rent, on average, with a $50 to $85 monthly minimum.
Keep scrupulous records
Whether or not you use a management company, you’ll have to keep extensive business records. DeDe Jones, CFP, CPA, in Lakewood, Colo., advises owners to save receipts for any expenses and to file them carefully.
The IRS treats maintenance expenditures, like a new hot-water heater, differently from capital improvements, such as a new deck or patio, so you’ll want to consult a tax professional. Meanwhile, keep the two types of receipts separate to make tax prep easier. You’ll have to file Schedule E on Form 1040, which can also serve as a template for the kinds of records you’ll need.
Finally, because of the complex tax and liability issues involved, many financial experts suggest forming a corporation when you become a landlord. An attorney can advise you about whether incorporating makes sense in your situation.
Richard J. Koreto has been editor of several professional financial magazines and is the author of “Run It Like a Business,” a practice management book for financial planners. He and his wife own a pre-Civil War house in Rockland County, New York.
Sunday, May 16 2010
Appraisers and real estate agents offer advice for curb appeal that preserves value and attracts potential buyers.
Curb appeal has always been important for homesellers. With the vast majority of today’s homebuyers starting their search on the Internet, the appearance of your property is more critical than ever. You only have a few seconds to catch their attention as they scroll through listings online to get them to stop and take a closer look.
But the role of curb appeal goes beyond just making a good first impression. The way your house looks from the street can impact its value. It can also shorten the time it takes to sell your house.
We asked real estate agents, appraisers, home stagers, landscape designers, and home inspectors which curb appeal projects offer the most value when your house is on the market, both in terms of its marketability and dollars. Here is what they told us:
1. Paint the house.
Hands down, the most commonly offered curb appeal advice from our real estate pros and appraisers is to give the exterior of your home a good paint job. Buyers will instantly notice it and appraisers will note it on the valuation.
“Paint is probably the number one thing inside and out,” says Frank Lucco, managing partner of Houston-based IRR-Residential Appraisers and Consultants. “I’d give additional value for that. If you’re under two years remaining life (on the paint job), paint the exterior because it tends to show wear badly.”
Just make sure you stay within the range of accepted colors for your market. A house that’s painted a wildly different color from its competition will be marked down in value by appraisers.
2. Have the house washed.
Before you make the investment in a paint job, though, take a good look at the house. If it’s got mildew or general grunge, just washing the house could make a world of difference, says Valerie Torelli, a California real estate agent with a background in accounting.
Before she puts a house on the market, Torelli often does exterior makeovers on her clients’ homes, a service she pays for herself to get higher selling prices. Overall, she says her goal is to spend less than $5,000, with a goal of generating an extra $10,000 to $15,000 on the sale price.
Torelli specifies pressure-washing—a job that should be left to professionals. Pressure washing makes the house look “bright and clean in addition to getting rid of unsightly things like cobwebs, which may not be seen from the yard but will detract from the home’s cleanliness when seen up close,” she says.
The cost to have a professional cleaning should be a few hundred dollars—a fraction of the cost of having the house painted.
3. Trim the shrubs and green up the yard.
California real estate agent Valerie Torelli says she puts a lot of emphasis on landscaping, such as cutting down overgrown bushes and replacing them with leafy plants and annuals mulched with beautiful reddish-brown bark. “It runs me $30 to $50,” says Torelli. “Do you get a return on your money? Absolutely. It sucks people in.”
You also don’t want bare spots. Take the time to fertilize the yard, throw out some grass seed, and if need be, add some sod.
4. Add a splash of color.
It could be a flower bed of annuals by the mailbox, a paint job for the front door, or a brightly colored bench or an Adirondack chair. “You can get a cute little bench at Home Depot for $99,“ Torelli notes. “Spray paint it bright red or blue and set it in the yard or on the front porch.”
It’s not a bad idea, but don’t plan on getting extra points from an appraiser for a red bench, says John Bredemeyer, president of Realcorp in Omaha. “It’s difficult to quantify, but it does make a home sell more quickly,” Bredemeyer says. “Maybe yours sold a couple weeks faster than the house down the street. That’s the best way to look at these things.”
5. Add a fancy mailbox and house numbers.
An upscale mail box and architectural house numbers or an address plaque can give your house a distinctive look that stands out from everyone else on the block. Torelli makes them a part of her exterior makeovers “I’ve gotten those hand-painted mailboxes,” she says. “A nice one runs you $40 to $50.” Architectural house numbers may run as high as a few hundred dollars.
6. Repair or clean the roof.
Springfield, Va.-based home inspector and former builder Reggie Marston says the roof is one of the first things he looks at in assessing the condition of a home. He’ll look at other houses in the neighborhood to see if there are a lot of replaced roofs and see if the subject house has one as well. If not, he’ll look for curls in the shingles or missing shingles. “I’m looking at the roof for end-of-life expectancy,” he says.
You can pay for roof repairs now, or pay for them later in a lower appraisal; appraisers will mark down the value by the cost of the repair. That could knock thousands of dollars off your appraisal. According to Remodeling Magazine’s 2009-2010 Cost vs. Value Report, the average cost of a new asphalt shingle roof is more than $19,000.
“Roofs are issues,” Lucco says. “You won’t throw money away on that job. You gotta have a decent roof.”
Stains and plant matter, such as moss, can be handled with cleaning. It’s a job that can often be done in a day for a few hundred dollars, and makes the roof look like new. It’s not a DIY project; call a professional with the right tools to clean it without damaging it.
7. Put up a fence.
A picket fence with a garden gate to frame the yard is an asset. A fence has more impact in a family-oriented neighborhood than an upscale retirement community, Bredemeyer says, but in most instances, appraisers will give extra value for one, as long as it’s in good condition. “Day in a day out, a fence is a plus,“ Bredemeyer says. Expect to pay $2,000 to $3,500 for a professionally installed gated picket fence 3 feet high and 100 feet long.
8. Perform routine maintenance and cleaning.
Nothing sets off subconscious alarms like hanging gutters, missing bricks from the front steps, or lawn tools rusting in the bushes. It makes even the professionals question what else hasn’t been taken care of.
“A house is worth less if the maintenance isn’t done,” Lucco says. “Those little things can add up and be a very big detractor. When people say, ‘I’d buy it if it weren’t for all the deferred maintenance,’ what they’re really saying is, ‘I’d still buy it if you reduce the price.’”