Four Tips on Setting the Right Price

Sellers think their homes are worth more than their real estate professional recommends, and buyers think these same homes are worth less.
It’s a difficult disconnect that makes selling properties a challenge. Successfully marketing a home requires that the price be set carefully — or it will languish on the market. Among the considerations:
  • How many homes are for sale in the neighborhood? The more homes on the market, the more important it is to list at the lower end of the scale. “I want buyers to ask why is this house priced so competitively,” said NAR President-elect Ron Phipps of Phipps Realty in Warwick, R.I. “I want the answer to be an offer.”
  • Take short sales and foreclosures into consideration when pricing. If the competing properties are in lousy condition, they are less of an issue, but if they are well taken care of, yet priced 25 percent below market, they can be a serious factor.
  • Negotiate decisively. “Buyers are not interested in back-and-forth negotiations these days,” Phipps said. “They are less emotional and more disciplined. They will walk away.”
  • Cut the price when you have to. If no one shows up for an open house, if no one calls and if there are no offers, then the price is too high. That means it’s time to make a meaningful price cut.
Source: The Washington Post, Associated Press (09/18/2010)
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Multiple offers are here to stay

I’ve had several buyers recently enter into multiple offer situations.  Completely different price ranges too.  One buyer was looking at a beautifully upgraded and updated single family home in Winter Park, FL, one of the most desirable areas in Central Florida, for around $300,000.  And the other, looking at one bedroom $30,000 condos.  Both buyers were engaged in a multiple offer situation, and both were shocked, stating, “aren’t we in a buyer’s market?”

Well, yes we are in a buyer’s market, however, the “good inventory” gets snapped up, especially when it’s the right price. In addition, investors are back in the market and are competing with buyers who are wanting to purchase homes as their primary residence.  Investors tend to be cash buyers and in both multiple offer instances mentioned above, there was no inspection contingency.  This is, in my opinion, especially foolish for a buyer purchasing their primary residence, but investors are capitalizing on this buyer’s market too by being less emotional in their purchase and offer strategies, and many times it pays off for them.

Another common buyer sentiment was “do you really think there’s another offer, or do you think the agent is bluffing?”.  I always believe a listing agent is telling the truth if they state there’s another offer.  Besides it being unethical to lie, here are some reasons I wouldn’t count on the other agent trying to play poker this early in the game:

  1. Some buyers refuse to enter into multiple offer situations and will therefore leave negotiations.  You would never want to pretend to have a buyer, in hopes of driving up the price, because a real buyer might exit, leaving no offers at all.
  2. It presents a fair picture of the situation if all parties know other offers are on the table.  That way a buyer can present their best offer, realizing if they don’t, the seller may not counter offer with them.
  3. There aren’t any secret property deals on a password protected, member’s only  website. If the property truly is a good deal, chances are, other buyers are aware of it.

My advice in multiple offer situations is to GO FOR IT!!  Present your best offer to give yourself the highest probability of getting the home.  If it’s a home you truly love, you may need to be prepared to fight for it.  The good news is, home prices and interest rates are low, so a few thousand dollars extra won’t make too much of a difference in your payment.  And there’s no better feeling than getting the home you love.

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Real Estate and YouTube Videos

I recently learned that the second most searched site is YouTube…only second to Google.  So as part of my new marketing push, I will be putting my listings on YouTube.  Below is my first YouTube video so I hope you enjoy it.  It’s for an amazing condo right in the heart of Downtown Orlando.

Be on the lookout for more videos to come!

http://bit.ly/bawOQ1

If you have a real estate need email me @ annemariesells@gmail.com or visit my website at www.annemariesells.com.

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Update on Chinese Drywall

NEW ORLEANS (AP) – April 9, 2010 – A federal judge on Thursday awarded seven Virginia families $2.6 million in damages for homes ruined by sulfur-emitting drywall made in China, a decision that could affect how lawsuits by thousands of other U.S. homeowners are settled.

It remains to be seen how the plaintiffs can collect from Chinese companies that do not have to respond to U.S courts, although some have talked about getting orders to seize U.S.-bound ships and cargoes from the drywall companies.

Thousands of homeowners, mostly in Florida, Virginia, Mississippi, Alabama and Louisiana, have reported problems with the drywall, which was imported in large quantities during the housing boom and after a string of Gulf Coast hurricanes.

The drywall has been linked to corrosion of wiring, air conditioning units, computers, doorknobs and jewelry, along with possible health effects.

U.S. District Judge Eldon Fallon ruled Thursday that the drywall needs to be removed and the plaintiffs’ homes need to be gutted because of the ruinous effects of corrosion. He said all electrical wiring, the heating and air conditioning system, appliances, carpet, cabinetry, trim work and flooring damaged by corrosion would have to be removed.

Fallon’s decision was the first in a series of federal lawsuits brought against manufacturers, distributors, suppliers and homebuilders by thousands of homeowners, all of them claims that Fallon is presiding over. Separately, thousands of plaintiffs are pursuing claims in state courts.

Thursday’s ruling could set the standard for what needs to be done to make a tainted home fit for living in. Fallon’s guidelines went further than those put out by the Consumer Protection Safety Commission earlier this month. The CPSC called for removing the tainted drywall, electrical wiring, fire alarm systems and gas pipes.

“We got everything we asked for,” said Richard Serpe, an attorney for the Virginia plaintiffs. “This becomes a roadmap for any court that is going to consider how the litigation should go from here.”

Fallon’s ruling covered only property damage and did not look at possible health effects. The first cases with medical claims won’t be considered by the court until late 2010 or early 2011.

It was far from certain who would pay for the damages. Civil judgments in U.S. courts aren’t enforced in China. Plaintiffs are suing American drywall suppliers, distributors and homebuilders, too.

Phillip A. Wittmann, a New Orleans lawyer representing homebuilders and drywall installers, said homebuilders have been proactive and gutted tainted homes they built.
“The homebuilders are really the only class of defendants doing anything for the homeowners,” Wittmann said.

In this case, the plaintiffs sued Chinese drywall manufacturer Taishan Gypsum Co., which hasn’t responded to lawsuits and did not have a lawyer representing it at the February trial.

Plaintiffs’ lawyers have said they would try to seize the company’s U.S.-bound vessels and shipments if the company continues to ignore the litigation.

So far, only one Chinese manufacturer – Knauf Plasterboard Tianjin Co. – has responded to U.S. suits. A separate trial was held last month against Knauf. Fallon has not ruled in that case. Also, homebuilders are suing Knauf Plasterboard and Knauf Gips KG, a German company, for damages, Wittmann said.

In a statement, Knauf Plasterboard said Fallon’s findings in the Virginia case were “distinct from the cases against KPT.” The company said it would work with federal and state regulators and others “in evaluating the concerns about drywall manufactured in China.”

Fallon said that Chinese drywall “has a significantly higher average concentration of strontium and significantly more detectable levels of elemental sulfur” than U.S.-made drywall. He added that the “level of corrosive sulfur gases emitted by Chinese drywall … exceed the safe level established by recognized standards, peer reviewed literature.”

The Taishan drywall was not tested under American engineering standards and Venture Supply Inc., the Norfolk, Virginia-based buyer, “relied on a representation that Chinese testing was equivalent to the U.S. testing standards,” the ruling said.

The ruling noted that Chinese tests were done by a Chinese government agency and not by an independent testing laboratory. The Chinese government agency issued “certificates of quality” based on a protocol that “predates the production of the drywall shipped to the United States by at least two years,” the ruling said.

Taishan and the owners of Venture Supply Inc. could not be reached for comment. A telephone number listed on Venture’s Web site was disconnected.

“The sulfur gases released by Chinese drywall cause offending odors in homes, making them hard if not impossible to live in,” Fallon said.

During the February trial, the plaintiffs gave emotional testimony about how their lives had been damaged because of the defective drywall that gives off a rotten-egg smell.

William Morgan and his wife, Deborah, moved to Williamsburg, Virginia, after he retired from the Norfolk police department. They quickly realized something was wrong with their “dream house.” Fixtures and mirrors turned black. Their lights malfunctioned. Their smoke detector system and water heater failed.

The problems drove them from their house into a rental home, leaving them in a financial mess that forced the couple to file for bankruptcy protection last year. Fallon awarded the Morgan family $481,613.

“I’m tickled to death with the decision, but as far as the mechanics of doing what needs to be done, I don’t know,” Morgan said by telephone Thursday.
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Copyright © 2010 The Associated Press; Cain Burdeau, Associated Press writer; Michael Kunzelman, Associated Press writer.

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Short sales simplified!

WASHINGTON – April 5, 2010 – Effective today, the short sale process is simplified. The only problem: Many lenders don’t know it, and Realtors may have to convince them.

The Home Affordable Foreclosure Alternatives (HAFA) program gives $3,000 to borrowers for relocation assistance, $1,500 to servicers for administrative and processing costs, and up to $2,000 to investors who allow up to $6,000 in short sale proceeds to be distributed to subordinate lien holders. The program was created to help stabilize distressed inventory such as underwater homes.

Some lenders have already adopted HAFA rules, but April 5 was the deadline for participating servicers to implement HAFA. The program reportedly covers servicers handling more than 90 percent of all mortgages.

However, the National Association of Realtors (NAR) says that it’s already hearing complaints from members. Many servicers say they haven’t even heard about the program, Realtors claim, so it’s clear that they won’t “hit the ground running.”

NAR says it will carefully monitor HAFA implementation and report delays and other program problems to the Treasury Department. However, “patience will be needed.” Realtors can negotiate faster short sales by urging lenders to comply with the new procedures and deadlines.

NAR offers a webpage with information on how HAFA works at: http://www.realtor.org/shortsales.

NAR also offers other short-sale info (including links to a 45 minute Webinar and a 15 minute video on a separate webpage: http://www.realtor.org/realtors/basics_short_sales?wt.mc_id=rd0041.  

NAR also produced a four-page HAFA informational brochure.

U.S. Treasury Department guidelines and forms (updated March 26, 2010):
https://www.hmpadmin.com/portal/programs/foreclosure_alternatives.html.

© 2010 Florida Realtors®

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Tax Credit Tips

The tax credit is almost over so what do you need to do in order to make sure you get your credit back ASAP?  Well the Washington Post’s excerpted article below should provide some guidance to make sure you turn everything in right the first time.  Make sure you speak with your tax professional about submitting the proper forms and they can give you an idea of when your tax credit should arrive. 

“The Internal Revenue Service has clarified which documentation taxpayers need to submit to claim the first-time and move-up homebuyer tax credit.

While the IRS is still requiring the filing of Form 5405, it is not demanding that all parties’ signatures be on the HUD-1 settlement document in areas where requiring both the buyer and the seller to sign the document isn’t common.

The IRS clarification says: “In areas where signatures are not required on the settlement document, the IRS has clarified that it will accept a settlement statement if it is completed and valid according to local law. … The IRS encourages those buyers to sign the settlement statement prior to attaching it to the tax return.”

For repeat buyers, the IRS is seeking documentation that home buyers have lived in the previous property for a consecutive five of the past eight years. Proof can include property tax records, home owner insurance records, or mortgage interest statements.”

Source: Washington Post (02/20/2010)

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The back dealings of Indy Mac

There aren’t many times where I’ve recently just copied and pasted articles for you to read.  I enjoy writing these posts and putting my own voice into each post.  However, in this instance, this video speaks volumes and is more than I could ever explain in one blog post.  Share this video with everyone you know.  This video is new information to me, but if this is how the back dealings of Indy Mac go in regards to short sales, I stand here speechless.  And it makes me wonder what’s going on in all the other bank’s loss mitigation departments.

The video states this is a REAL SCENARIO!

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www.annemariesellsorlando.com

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