'Should I Take My Home Off The Market During The Holidays?'

http://realtytimes.com/rtpages/20111125_holidays.htm

Should I Take My Home Off The Market During The Holidays?

by Realty Times Staff

When you look at your holiday calendars you may find the months already overloaded with seasonal obligations -- shopping, entertaining, children's pageants, charity work, decorating the house, and so much more. If you are also trying to sell your home, you are under extra pressure to keep your home in "showtime" condition. And that could be the last thing you need before the holiday spirit is broken.

It is understandable why you would be tempted to take your home off the market during the holidays. And the list of justifications is long. If you are too busy, buyers may be also, and you may find your efforts unrewarded by enough showings. And what if you do get an offer? You may be faced with the possibility of packing and moving during the busiest time of the year. Besides, you can give your house a rest, and it will have better momentum after the holidays. Better to just pack it in and start fresh in January, right?

But wait! Top-selling Realtor Jennie Ling says taking your home off the market during the Christmas season is a mistake. A vice president of Virginia Cook REALTORS® and the number one sales person in her company for almost every one of her more than 35 years in the real estate business, Ling exclaims, "The house sure isn't going to sell off the market! What is the advantage of that? So you're busy. Let your Realtor do the work. You can leave in the morning, go to work, go shopping, and let your Realtor take care of things."

"The holidays are my best-selling period. Why? Because most people take off work sometime during the season. The husband and wife are both off and want to see houses. I showed homes on New Year's Day last year. I like the holidays because the buyers have more time, and they can look at homes together."

Before you take your home off the market, consider the following points:

• Although buyer activity may appear to slow down, the buyers who are actively looking during the holidays are that much more serious. Ling believes the home market is no more affected at Christmas than during other "busy" period. If that were so, the market would shut down throughout the year as families concentrate on spring weddings, June graduations, summer vacations, and autumn back-to-school activities.
• Many buyers deliberately choose to shop for a home after the busy spring and summer rush. They know that it will be easier to look, and that negotiations will be less stressful. They may not have children, or they may have grown children, so moving to accommodate the school year isn't a consideration. Finding the right home at the right price, however, is.
• Relocating families often don't have a choice in when they can leave for their new destination. Although 68 percent of transferring families have children, many families have to transfer during the middle of the school year. These families are that much more motivated to get their families settled in before either before the January semester begins, or to arrange for the move during spring break in March. If you sign a contract by New Year's Eve, the timing couldn't be more perfect.
• At Christmastime, our culture focuses on family and the home. Preparing for the indoor activities of winter is one of the most enjoyable periods of family life. Allowing buyers to view your home during this most hospitable of seasons lets them better picture their own family life in the attractive environment you have created.
• When is your home ever more beautiful and inviting? You have cleaned and decorated, and your home looks like a picture postcard. If the results are good enough for family and friends, they will surely be good enough to impress your buyers. Get the family team on board to do a five-minute blitz pick-up every morning to keep holiday messes to a minimum.
• With reduced inventories and motivated buyers, you will have all the members of the MLS on your team. You may find you have more showings than you would if your marketed your home during a busier time of the year.
• If you do get a contract, you can arrange the terms to suit your needs. If moving during the holidays isn't an option, you can put in the closing date of your choice. "Most people can close 30 to 60 days after a contract is written, so there is plenty of time," Ling says. "Possession and closings are are very negotiable."

Published: November 25, 2011

How I save a client $4000 in a year

Two years ago I took a listing. The house is less than 10 years old, located in a desirable part of town, house size is good for the price we listed.

However, the house had been rented before, and the renter left a smoking smell behind... In addition, when owners rented to the past renter, they rented $300-400 below market.

Anyway, the smoke smell did not help the listing despite our marketing effort. After 6 months owners decided to rent again.

This time it was rented to better qualified tenant, and at market rental price. This saved the owners $3600 that year.

While house was listed, I saw that the windows are foggy-- meaning they had broken thermal seals. Since house is under 10 years old, I investigated whether windows were still under warranty. They were! So the owners got 3 windows replaced for FREE. That saved them another $600.

Although house still not sold, at least in the past month, the owner saved $4000.

Thus is the value of Realtor!

Busy in Fall

Many non-real estate people believe that once school begin in late Aug., real estate business become slow.

However, the truth is, we are quite busy this Fall. I have 3 buyers actively looking to buy, 1 listing sold in 2 weeks, and 1 duplex under contract in 1 week.

Again, in Real estate, it's not the location or the price range determine the speed of sale of a property. The main determination is the pricing. There are over 1000 listings in this city any day of the year, pricing correctly is the most important factor for getting property sold.

TV News and local Real Estate

Eager homebuyers and nervous sellers are often confused by conflicting news stories, most of which focus upon the more sensational aspects of the housing market and economy. With TV, major newspapers, magazines, and Internet sites bombarding consumers with ever-changing economic news, many are paralyzed in fear of taking action either too soon or too late.

Sellers want to know if home prices are still falling, and if they’ll be able to compete with foreclosures and short-sales. Buyers also want to know if home prices are falling; and if they are, how long they should wait to get the best deal.

Watching the evening news or reading the multitude of print articles only serves to amplify the confusion; one story advises consumers to prepare to be lifetime renters, while another describes the best time to buy a home in decades. There are stories providing data on why homes are a lousy investment, on the difficulty of selling in today’s market, on the changes in demographics that will forever alter the face of housing. And while there may be a kernel of truth in each feature, most articles paint with such a broad brush that much of the information has little bearing on local markets and is worthless to the average consumer.

Eager sellers need to know that while the market is difficult, with most areas having lots of competition, and in some an ample supply of distress sales, that appealing, competitively priced and aggressively marketed homes are selling. In order to compete they will need the advice of an agent familiar with local conditions and who is aware of current prices and the most successful marketing techniques for their area. Additionally, serious sellers must respect their agent’s advice on pricing their home—if they don’t trust them, they’ve chosen the wrong agent.

Finally, there are homes being bought and sold in all markets. Savvy buyers and hopeful sellers can achieve their goals—if they approach the process with a willingness to listen to the professionals, not the talking heads on TV.

Columbia MO in the news

http://finance.yahoo.com/real-estate/article/110830/where-to-buy-a-retirement-home-for-under-$600-a-month?mod=realestate-buy

Quote:

For Americans looking to buy retirement property, the historic real estate crash has created all sorts of opportunities. Home prices in 20 major metropolitan areas have declined roughly 28 percent from their 2006 peaks. Meanwhile, government efforts to ramp up demand for homes have significantly reduced mortgage costs for borrowers. Thirty-year fixed mortgage rates stood at 4.37 percent for the week ending September 16, only slightly above the 39-year lows reached two weeks earlier.

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8. Columbia, Mo.

With 102,000 residents, Columbia, Mo., is the home of the University of Missouri. On account of Columbia's affiliation with the university, area residents can enroll in continuing education programs and cheer on the Tigers at football or basketball games. The median home price in the area was $147,000 in the second quarter of 2010, a slight increase from a year earlier. Buyers who make a down payment of 20 percent--or $29,400--on a median-priced, Columbia-area home will have monthly payments of about $587.

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After the tax credit

The $8000 and the $6500 tax credit came and went.

During the last weekend of April, in Columbia Board of Realtor MLS, 54 properties went under contract. That is the highest number I have ever seen.

What happens after April 30th, 2010? Well, this week, since Tues. the new pending number went back to about 10 per day.

In a 'normal' year, during May-Aug, daily deals made average 10-25 per day.

It looks like we will get back to our 'normal' market, business as usual.

Closing cost

Most home buyers need home loans. All home loans come with a closing cost. I have seen closing cost from $1300 to $4700. Why is the difference so big?

Well, one loan officer's quote of closing cost item list is not same as another.

To some, closing cost means:

-- lender's application fee, underwriting fee, document preparation fee, appraisal fee, flood letter fee, credit report fee

To others, it also include:
-- inspection, 1 yr insurance on the home, lawyer fee, etc.

Yet to others, this include prepaids.
-- prepaids apply especially to borrower who have less than 20% downpayment, the lender require to escrow for property taxes and home hazadous insurance. It's usually paid 3-4 month ahead. On a #200,000 home, the tax escrow is about:

$200000 x 0.011 (Columbia MO property tax rate) / 12 x 3 == $550

Insurance escrow is about 1/2 of that.

Prepaids are items homeowners have to pay sooner or later, so it is really not a cost, just some money to be reserved for future payments.

In Missouri, closing cost is relatively low. Lawyers are not needed. Missouri also does not have 'transfer tax' -- like a sales tax for home sales. Some states charge up to 2%. For a $200,000 house, the transfer tax would be $4000.

The following link shows the transfer tax rate by states:

http://www.ncsl.org/default.aspx?tabid=12661

In Columbia MO, without escrow items, closing cost for a $200,000 house is only about $1500-2000.

In the tougher market, some sellers offer to pay some closing cost for the buyer as incentive. Or, the buyer could ask for it in the contract.

Recently Fannie Mae and Freddie Mac are giving closing cost credit as incentive to attract buyers for their properties.

Foreclosures can be good deals. In Columbia MO, the recent foreclosure rate is only 2-3%. Therefore finding that fits your specific need of size and location may be difficult to find.

Back to closing costs, here is a link to average closing cost:

http://www.bankrate.com/brm/news/mortgages/ccMissouri.asp

The fees listed in above link is actually more than what I have seen. Application, processing and underwriting is normal, but the origination is not. Ask your lender about each item. Don't assume you have to pay it. Negotiate. Or, at least compare between different lenders.

Points are not something all borrowers have to pay. Points are upfront money to be paid to lower the interest rate.

The current interest rate is historically low, therefore there is not a good reason to pay points to lower it in current market.

If you have any more questions, drop me a note, and I will try to answer them, or at least point you to the right direction.

Making Money and Building Wealth

Many people see these 2 terms and think they mean the same.

But, ponder a while, do they really?

Since I have had the experience working and living elsewhere before coming to USA, I believe making money and building wealth are 2 very different things in USA.

I worked and lived in Hong Kong for 10 years before coming to live in USA. The top tax rate is Hong Kong is 15%, and every tax payer enjoy a rather high standard deduction. I knew people who were single and make about US$100,000, still only pay about 12% income tax after the deductions.

It still amaze me how much taxes people in US pay. But, oh well, that is another subject for another day, or month, or life time.

Given we live here, how does one build wealth if one must pay so much taxes?

Well, one of the tool is, of course, real estate.

Just last week I have a buyer under contract buying a foreclosed duplex.

This young man is so mature. He saved money, had a goal, and barely in his mid 20's, he is buying a 5 yr old duplex with more than 20% down.

With the current low interest rate, he can buy the duplex, live in one side, rent out the other, and the rent he will receive will cover over 80% of his mortgage payment.

Oh, this young buyer has further plan than this, he is getting a 15 yr loan, hoping that in 5-7 years, he will have more than 1/2 of the duplex paid, and then he will hopefully get married and buy a single family home.

At that point, he could keep the duplex for rent, or sell it, depending on the market.

Why Real Estate investment help build wealth? Well, for one, the IRS allow depreciation for the building you rent out. That depreciation is an expense, that can off set the rental income, therefore offset the taxes on the rental income.

The depreciation rule is rather complicated, but, no free lunch right? If one wants to save some taxes, one needs to put in a few hours of paperwork, and a few hours of tax code studying.

My husband and I own 10 units of rentals. In most years, those rentals report a lost on paper, after depreciation.

Simply, currently the IRS allow buildings to depreciate at a rate of 27.5 years. If you have a $120,000 duplex, and if the land that the duplex is on is worth $20,000, owner can depreciate the building, not the land.

So the building without land is worth $100,000, which allow owner to write off $3636.36 income per year.

Now, the tax code is a whole lot more complicated than that, but for now, this is enough to get someone to start to ponder about RE investments.

World Journal Article

陳寧：買房子 正是時候
記者阮叔梅密蘇里州哥倫比亞市報導
March 14, 2009 12:00 AM | 17 觀看次數 | 0 0 評論推薦: | 電郵給朋友 | 打印
在密州哥倫比亞市從事房屋仲介業的陳寧認為，房價下跌、低利率、聯邦政府津貼等因素，都極有利於購屋者。 記者阮叔梅／攝影

在密州哥倫比亞市從事房屋仲介業的陳寧認為，房價下跌、低利率、聯邦政府津貼等因素，都極有利於購屋者。 記者阮叔梅／攝影
slideshow
經濟不景氣，全美各地房地產價格普遍下跌，加上低利率、聯邦政府津貼，有些房屋仲介業者認為，目前買房，正是時候。

在密州哥倫比亞市從事房屋仲介業的陳寧表示，為了刺激經濟，聯邦政府日前推出優惠方案，凡是首次購屋者，購屋時間為2009年1月1日至2009年11月30日之間，均可獲得聯邦政府8000元的津貼﹔首次購屋者的定義為過去三年未擁有自用住宅的消費者。

陳寧說，許多法拍屋價格慘跌，但是消費者還是必須小心，事先找人估價並檢查房屋狀況，才能保證事後不會後悔。

全美法拍屋比例高達約12%，內華達、加州、亞利桑納、佛羅里達為法拍屋比例最高的四個州，但是近來受到失業率不斷上升影響，密西根、喬治亞、俄亥俄等州法拍屋比例有後來居上的趨勢。

密蘇里州法拍屋比例全美排名19，相對而言，哥市為大學城，受經濟不景氣衝擊有限，法拍屋比例不到2%，過去三年，哥市的房價跌了大約5%。

陳寧表示，哥市是有些價位低於20萬的房子，甚至出現買主競相出價的情況。她也建議房屋賣主，重新粉刷牆壁，更換客廳地毯，都有助於房屋及早賣出。

Market condition

It is really getting busy in Columbia MO.

We now have 8 under contract. 4 will close in April, 3 will close in May, 1 in Oct.

2 more new listings coming soon also.

Too busy to blog these days.

2 Listings under contract

It has been a great week. 2 listings got offers and are now under contract. One was only on market for 10 days.

Both should close in end of April.

Our Market as of April 5, 2009

Here is a quick and rough data:

We currently have 226 single family homes priced between $50,000 to $250,000 under contract in Columbia school district in MLS.

Of these 226, 66 were on market less than 30 days.

The longest on market day is over 700 days.

Why some sold in 1 day, while others take 700 days?

In my experience, first factor is price. No matter the age and location of the house, if it is over priced, it will be on the market for a while. How long it will sit depending on how much it is over priced.

Sellers who bought a home around 05-06 have a hard time to price it according to current market. Yet the reality is pricing it right, pricing it competitively will save seller much headache and money later. Having a home for sale for over a year or 2 years cannot be beneficial to anyone esp. the buyer -- often the over priced home end up selling for less than market because the buyer tend to negotiate more aggressively, knowing that it's a stale listing.

Needless to say, other than price, how well the home shows is important. Painting is an inexpensive way to spruce up a home quickly. I have heard many seller say, 'we don't know what color the buyer would like, buyers would like to paint it to their own color choice anyway.'

However, the living room and kitchen often give the first impression, and if seller is serious about selling, they should paint at least the living room and kitchen to a neutral color, but not white. I cannot count how often a buyer would say 'boy that house look sterile.' A house with nothing but white paint make people think of hospitals.

A few hundred dollar in paint and labor can bring a couple of more thousand in sales price, because new and neutral paint would make a home look new and well cared for.

If a seller does not know what color to choose, one easy way is to go view some new construction homes, and copy one of them.

24 pendings over the weekend

This past weekend we had 24 properties under contract in Columbia MLS system. One of Paul' buyer is one of them. Paul also has a condo under contract verbally, which is not included in the 24 count.

One thing worth to note is that 3 of the 24 are in the $300k price range. So the outlook for the higher price home in the Columbia MO market is looking good this year.

Foreclosure rate in Boone County

From Columbia Business Times:

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Local foreclosures on record pace; However, numbers still small proportion of property total

by Jacob Barker

November 28,2008

Tom Schauwecker, Boone County’s assessor since 1989, and Greg Harmon, a veteran real estate agent, are both authorities on the subject of foreclosures. Both say they’ve never experienced anything like the current market, which is forcing a record number of people to lose homes and land.

For Tom Schauwecker and his staff, the downturn is giving them some down time for the first time in years. For Harmon the slowdown has swamped his Web site, which tracks and lists foreclosures in Boone County.

Schauwecker said for the past 19 years, “we’ve been so busy appraising and photographing new construction, that the decline in building permits has allowed us to step back and do a little analysis.”
Tom Schauwecker

Tom Schauwecker
Greg Harmon

Greg Harmon

His staff was able to compile a detailed list of property foreclosures in Boone County-expected to reach 300 this year-and develop a map showing their location. There’s been a lot of inquiry on the subject, he said, primarily from the media.

Rob Wolverton, president of R. Anthony Development, cautions that the local foreclosure rate should be put in perspective: it’s high for Boone County, but low relative to total property and to the national rates.

“For those 300 people, this is a catastrophe,” Wolverton said. “But there are more than 40,000 housing units in Boone County. It’s an issue, but it’s less than 1 percent of the market.”

An estimate from the Secretary of State’s office at the beginning of October put the total number of foreclosed homes in Missouri at 27,000. Nationally, for all FDIC insured institutions, the ratio of non-current loans and leases to total loans and leases in the second quarter more than doubled, to 2.04 percent.

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To read more:

http://www.columbiabusinesstimes.com/2825/2008/11/28/local-foreclosures-on-record-pace-however-numbers-still-small-proportion-of-property-total/

22 houses under contract over the weekend

Weather is still cold but home buyers have gotten out of their hibernation. Over the weekend, in the MLS, 22 properties went under contract. That is a bigger number than I have seen in a long time.

One of them is our listing in Hallsville, $191500. There were almost a bidding war on that! And in the beginning I thought it might be hard to sell.

Paul and I both had open houses. The house I was in was a $172000 3bed 2 bath slab in SW, 10 parties came, that was fun!

Paul was in a ranch w/o in SW, priced $225000. He had 6 parties coming through. Lots of people looking now.

Buying Foreclosed Properties

I had 4 opportunities to work with buyers buying foreclosed properties in 2008.
Foreclosed properties can be good deals for the buyer, but not always. I have seen foreclosed properties listed for higher price than normal market price. The owner of foreclosed properties are often not in town, and do not know the local market well. They normally use a local real estate agent, but not always. Currently in Columbia market, there are foreclosed properties listed by real estate agencies located 2 hours away. A side note, there are rental properties managed by out of town management companies. Why the landlord decide to use someone 2 hours away to manage the property is baffling to me.

In any case, the buyers may get a good deal buying a foreclosed property, but buyer also take on some risk.

Normally the seller would not repair anything wrong that is found by the inspector. Although after inspection, the buyer can back out of the contract, but at that point, buyer has already paid for the inspection. So that is an expense. Also, if the property pass inspection, buyer applying for loans still need to get an appraisal and pay for it.

If the appraisal price is lower than contract price, again, buyer can back out, but by now buyer has spent more money.

It is important the buyer use an agent or do detail research on their own to find out whether the previous owner (before foreclosure) owed anything else on the property.

In Jan. one of my buyer bought a foreclosed property and we found there were a $20000+ tax lien on it. The seller paid for it, otherwise, the buyer would not have bought the house!

In conclusion, buying foreclosed property could be a good deal, but the buyer and agent have to be extra careful.

Bidding wars in real estate, again.

In the past 10 days, I saw 2 bidding wars in our office. One house was $149900, and had 3 interested parties. Another house was $172900, and had 2 full price offer.

Humm, spring is coming...

$8000 tax credit for first time home buyer in 2009

I have been research everyday to get the details about this. Here is what I found so far:

From the Wall Street Journal:

Congress slightly increased to $8,000 an existing $7,500 credit for first-time homebuyers and eliminated repayment provisions. Congressional negotiators said that $8,000 number isn’t yet finalized…

The new credit is retroactive to Dec. 31, 2008, which means that anyone who buys a house this year, through August, won’t have to repay it. First time buyers who used the credit in 2008 still have to pay it back over a 15-year period.

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Ling's note: Somewhere else I read that credit is available to buyers who close on a house through Dec 1, 2009 -- why not Dec 31, 2009? I don't know.

Alo, there is income limit. For people making over $75,000/yr or couple over $150,000/yr, this may not apply.