Posts

THE PERFECT STORM FOR BUYERS

The sub-prime mortgage troubles of 2006-2008 has left the mortgage industry limping - causing the failure of a number of well-known banks.

The Federal Government stepped in early September, 2008 to rescue Fannie Mae and Freddy Mac, the two giant, quasi-governmental companies that buy the bulk of the mortgage loans from commercial banks and were experiencing difficulties. This "rescue" signalled the intention of the government to shore up the mortgage industry and help the housing market lead the economy out of the doldrums.

With the economy stalling, the Federal Government has stepped in to provide a stimulus to help the housing market. A combination of fac...

THE UPS AND DOWNS OF THE REAL ESTATE MARKET

So, you noticed that three years ago, your next door neighbors put their house on the market one morning, and by that afternoon they had multiple offers to choose from. Now you have been trying to sell your home for six months and there's just no action...!

The real estate market is unpredictable in the short term, since many factors (like interest rates, the amount of new homes being built and the economic health of the area) come into play. In the long term, the real estate market behaves just like other economic markets. It is a cyclical market (and in many places also seasonal). And it is driven by underlying supply and demand.

In a strong sell...

For the first time since 2002, the Personal Income line and Median Sales Price line will intersect again this year, showing the effect that the softening of the real estate prices in Mt. Pleasant has had on home affordability: The green line shows the average percentage of household income that a household spends on housing - we are back to the level of affordability we had at the beginning of the century! This is good news for first-home buyers and for families who need to upsize their home! Peak inventory in Mt Pleasant happened back in July 2007, and, given that demand has decreased noticeably, housing is forecasted to remain affordable for a while - we still have a large inventory to ...

You can bet on it - the KITCHEN is one of the key areas of a home that most buyers will look at to short-list their preferred homes from a long list of available listings.

A smart seller will devote time, attention and money to make the kitchen sparkle! Although many buyers want an updated kitchen (solid surface countertops, modern cabinets, stainless steel appliances, etc.), your kitchen does not have to be state-of-the art to be appealing.

Think first impressions: What would you do to impress your future mother-in-law if she was coming to visit you for the first time?

The first step towards enhancing the appeal of your kitchen is giving it a thorough cleaning and tidying up. Make s...

MAKING "CLEAN" OFFERS

You are in the market to buy a home and you found a house that's ideal for you - it is in the right location and meets all your "needs" and "wants". The price is the only thing that is keeping you from making an offer, because you feel that it is more than you can afford... how can you improve the odds of the Seller accepting your offer (that is much lower than their asking price)?

In addition to a market justification for a low offer (which your REALTOR can provide) an important strategy you should use is to make your offer as "clean" as possible by not asking for special conditions or contingencies.

• Avoid making demands on the sellers for minor repairs, such as ...

Even if you are selling your home "as-is" (which means you are not willing to pay for any necessary repairs), most buyers will include an inspection contingency clause in their offer. This will allow them to hire any number of experts (including a home inspector, a termite inspector and a structural engineer) to make sure that the house is safe, structurally sound and all the systems are working properly (i.e. that they are not buying a "lemon"). The inspection contingency allows them to walk away from the deal without losing their earnest money if they are not satisfied with the condition of the property.

You, like most owners, will probably know most of the issues that need attention a...

I recently read an article in the Post & Courier that had some interesting suggestions about how to use your tax refund this year to improve your credit score. These are the highlights:

1. Set aside only a small percentage (i.e. 10%) of the refund as "spending" money.
2. Set up an emergency fund - just in case you or your spouse are laid off. They recommend having 6 months to 12 months household expenses in this fund. You can put up to $5,000 a year ($6,000 is you are 50 or older) into a Roth IRA and invest it in a CD or money market mutual fund so that it is not vulnerable to stock market variations. And you can use this money for college, retirement or emergency without paying penalties...

We make thousands of small and big decisions every day. Our senses (eyesight, smell, feeling, hearing) are constantly telling us a story about our surroundings. When we are looking to buy a home, those INITIAL impressions from the first few seconds after we stop in front of a home may make a positive or negative emotional impression that may outlast later impressions (remember that "an image is worth a thousand words").

This initial impression makes a statement about your home and yourself as the owner. Whether your home is contemporary or traditional, older or newer, its architectural features and curb appeal will impact potential buyers. Your home has its own unique features and personal...

I use several "preferred" home inspectors regularly, because they have shown professionalism, subject knowledge, thoroughness and reliability.

Housemasters is one of those, they send me a regular newsletter with topics of interest. Their latest newsletter talked about the top 5 conditions that inspectors find in foreclosed homes, which I thought would be interesting to share. Here is a summary:

1. Mold - many foreclosed homes have the power disconnected or may have developed ongoing leaks that coupled with a boarded up or abandoned home creates the appropriate moisture conditions for mold to grow unabated, especially in the Lowcountry, where humidity levels are high. Black mold can creat...

BUY NEW, OR EXISTING?

One of the big decisions that a buyer must make, is whether to buy a new home, or an existing one. While new homes tend to have higher prices than comparable existing ones, there are other factors to consider:

TIMING - new tract homes can take 4-6 months to build (up to 12 months for custom-built). If you need a home sooner than this, you may look at inventory homes (or "specs") that new home builders may have available or in advanced construction, or existing homes.

PRICING - while new homes are generally more expensive, when a market is over-supplied, new home builders tend to offer larger incentives for buyers than those an existing home owner may be able to give. In...

The $8,000 tax credit is a great incentive for a first home buyer (or someone who has not owned a home in the last three years). I have already sold three homes to families that will benefit directly from this incentive.

If you are currently renting and "thinking about" buying, please note that you MUST purchase the home BEFORE November 30th, 2009 to qualify for this tax credit.

Don't miss out! The tax credit, low mortgage rates and low home prices form a very special and favorable set of circumstances.

USING CREATIVE NEGOTIATIONS

If a buyer has an 850 Credit Score, 45% downpayment and does not have to sell a home, his/her offer on your home is a strong one! However, many buyers are not in that situation. And while as a seller you would like to get your asking price and no conditions, an experienced agent will prepare you for the possibility of receiving offers that involve less than ideal conditions and may require some compromises.

Successful REALTORS® know how to structure creative offers and do whatever it takes to make a transaction work ("a bird in the hand is worth more than two in the bush"). If a buyer is low on cash, your counter-offer may shift some closing costs to you (the...

Remember the days when you as the Seller told the Buyer to accept all your conditions or else? Those were the days when hard-nosed and belligerant REALTORS and their ambitious clients could get away with anything, and the Buyers would have to swallow it whole!

Boy, has the market changed! Nowadays Buyers have the upper hand, an Sellers and their listing agents need to have a completely different approach to negotiations. The moment a seller appears inflexible or rude, Buyers just walk away from the negotiations (why wouldn't they, there are plenty of options out there for them!).

Today's successful negotiations need:

1. Patience - negotiations take a lot longer to come to fruition, it i...

New regulation recently passed this year allows Reverse Mortgages (HECMs) to be used for the purchase of a home. The requirements to obtain an HECM are that one of the homeowners needs to be over 62 years old, and the owners must have substantial equity in the home (the HECM only lends up to 50% of the appraised value of the home).

What is HECM for Purchase?
HECM for Purchase allows seniors, age 62 or older, to purchase a new principal residence using loan proceeds from the reverse mortgage.

What is the purpose of the program?
The program was designed to allow seniors to purchase a new principal residence and obtain a reverse mortgage within a single transaction by eliminating the need f...

I read this article published by Experian, one of the three national credit rating agencies, and thought it was interesting to share:

IN THE KNOW: The Top Three Credit Myths: Revealed

Myth #1: Checking my own credit report will lower my score
Personal inquiries, also known as "soft inquiries" or "below the line inquiries," are not visible to lenders and therefore are not part of your credit score calculation. So you can rest easy-checking your own credit report or score does NOT negatively impact your score.

Myth #2: Applying for new credit will actually lower my score
This depends on the type of credit you're applying for. If you apply for several credit cards within a short period of t...

Legal Jargon Overload

When you buy a home, the closing attorney (SC is an attorney state) will make you sign stacks of papers, affidavits and documents filled with legal jargon. Most of these documents relate to establishing your identity (for legal and tax purposes), transferring the deed, and formalizing any loans and mortgages.

Depending on their personality, some buyers are anxious to get out of there and get their keys (so they sign all the paperwork as fast as they can without even reading it) while others are extremely cautious and read every sentence before signing (and find it very frustrating to have to read these documents at the closing table, while causing everyone else to ...

With home values fluctuating the way they have in the last three years, appraisers are under increasing scrutiny from government agencies, lenders and mortgage insurance companies. Three years ago it was relatively easy to conduct an appraisal based of recent comparables and escalating property values. Today, the market is very inconsistent, partially because distressed (such as short sales, foreclosures and lender-owned) properties skew the "normal" market and makes value prediction more of an art than a precise science.

What are appraisers looking for in this market? Here are some of the things they are looking for (I have received many calls from appraisers to find out information abo...

It is another sunny day in Charleston! And, contrary to the doom and gloom that we read in the papers every day, our residential real estate market seems to be "moving along" towards a recovery.

INVENTORY - is still coming down slowly. We peaked at 2025 units in July 0f 2007, currently at 1623 units.We are already seeing some For-Sale-By-Owner signs around, so inventory will probably grow in the next two months as sellers try to catch the Spring/Summer buying wave, and decrease during the summer months when those sales close.

UNITS SOLD PER MONTH - we bottomed at 46 units in November last year, and we are back to 93 units for March 2009.

ABSORPTION - Although absorption went up in the ...

Welcome to BuyHomesInCharleston.com. With the advances in information technology, the role of the REALTOR has changed in the last 15 years. Before the Internet became popular, REALTORS and their MLS associations controlled all of the information about listings; nowadays every other website will give the savvy buyer more information than what they really want or need.

Our role as REALTORS has changed: We have become LOCAL MARKET ADVISORS (information interpreters), fiduciary consultants, savvy negotiators and experienced business relationship managers with the objective of ensuring successful and smooth transactions from contract to closing and protecting our clients' best interests.

We ...