How to know the Real Estate market is rebounding

While most of us can’t predict when the housing market will rebound - there are signs that will tell us it is turning upwards.

These leading indicators are:

Inventory - As more people buy, the inventory drops. Right now the supply of homes on the market is high. In North Dallas, a 6 to 10 month supply of homes indicates a balanced market. When our over supply starts dropping, we’ll know the market is rebounding.

Time on the Market - The average time that homes are on the market is an good indicator of market conditions. As inventory drops, so should the time on the market. An average time of less than 140 days in healthy for our area.

Prices - We’ll know the real estate market is gaining strength when home prices start rising again. But I like to say that in today’s market, flat is the new up. [where: 75230]

Spraying Tonight

A city version of crop dusting will take place in Preston Hollow this evening to battle those pesky mosquitoes carrying West Nile Virus. Weather permitting, the City of Dallas will spray the neighborhood this evening at 10:00 and conclude by 3:00 a.m.

As I child, I rode my bike down the middle of the street behind the trucks that sprayed the Air Force base where we lived. We loved zipping through the white fog of pesticide. It was probably clouds of DDT they were spraying and its amazing we're still alive and our kids don't have 3 heads.

Today's chemicals are probably safer. But I'll be locked up inside just the same.

[where: 75230]

Video Home Tours

I enjoy video homes tours and prefer them over virtual tours. Video tours use photos of the property and are often set to music. Virtual tours are taken with a special camera that spins all the way around the room giving a 360 degree view. Some people complain that they make them dizzy.

My video tours are produced by my talented 17-year-old daughter. She uses Windows Movie Maker (like some of the pros). This program comes already loaded on many computers. Take a look at how they stack up against the professional video tours.

This is a nice, typical video tour (priced around $200). Some are better than others.

This one combines a bit more of the virtual tour concept.

Some like this one, are as low as $50 a tour.

And then you have my video tours:

I'll admit that I'm biased. How do you rate most video tours?

All Aboard For Food & Fun - at the Fair

Even though cooler weather may seem way off - the State Fair of Texas will be here before you know it!

I just sent in my confirmation to judge another year of culinary treats in the State Fair cooking contests. What fun to go from being a (sort of ) mild-manner Realtor to being a Judge. No need to call me 'your honor' - just bring on the home made ice cream.

The fair will run from September 25th through October 18th, 2009. This year's theme is "All Aboard For Food & Fun". And the diet starts today.

[where: 75230]

Use your Resources

I not only use all the brains that I have,

but all that I can borrow.

Woodrow Wilson

I don't know all the answers,

but I know where to go find them.

Lydia Player

[where: 75230]

Freddie Mac reports we've hit bottom

Some days it seems like finding good news about the economy is on par with searching for the proverbial needle in the hay stack!

But I have some positive statistics about the housing market to share:

1. Federal Home Loan Mortgage Corporation (Freddie Mac) analysts have reported that home sales bottomed in the first three months of 2009 at an annual rate of 4.46 million per year. They expect steady gains each quarter to reach a pace of 5.85 million home sales per year by the fourth quarter of 2010.

2. In its July 2009 Economic and Housing Market Outlook, Freddie Mac states sales of both new and existing detached single-family homes are expected to bottom this year at 4.72 million -- down 37 percent from the 7.46 million transactions closed in 2005 -- before rebounding to 5.5 million next year.

3. Through May 2009, the report shows Florida has posted nine consecutive months of growth in sales, and California has posted 14 months of growth in a row. (Strength in these markets bode well for the entire nation.)

4. Rates on 30-year fixed-rate mortgages are expected to continue rising from their low of 5 percent in the second quarter of this year, reaching 5.5 percent in the final quarter of 2009 and 6 percent by the end of 2010. At 5.8 percent, however, Freddie Mac states the projected average for 30-year fixed-rate mortgages is still low by historic norms.

5. Jumbo lending appears to be staging a comeback of sorts, with major lenders once again buying the oversized mortgages from other lenders or allowing independent mortgage brokers to originate loans for them. (Any loan over the $417,000 conventional loan limit is considered a jumbo loan.)

A Good Tea Party in Dallas

The Village Tea House is scheduled to open at the southwest end of Preston Forest in September. They offer health conscience tea choices in a soothing atmosphere.

This commercial corner must be doing something right in this down market because the center has added CVS Pharmacy (from across Preston Road) and Clothes Horse Anonymous (from across Forest Lane). The new Rockfish Restaurant didn't keep the old Mainstream Fish House location quiet for long.

Seems like they just keep packin' em in at this intersection. And the tea house addition near the yoga place seems appropriate.

Ahh - just think. A hot cup of tea when the weather starts cooling down. Good timing. [where: 75230]

10 Reasons Why Realtors Hate Short Sales

I hate shorts sales. They are not short and they are seldom sales.

At the risk of sounding heartless, people at risk of foreclosure who are considering a short sale should exhaust all other options before taking the short sale path. Read my post about why sellers hate short sales. Buyers should also run the other way from a short sale. Read my post about why buyers hate short sales.

A short sale is designed to help a seller fend off foreclosure. But they usually end up in frustration for all parties involved - including the real estate agents. As a Realtor, I hate short sales. Here are a few reasons:

1. They are a huge waste of time. They usually don't end up in a sale after dragging on for months. No sale, no pay day.

2. The government is involved. Now that the feds have stepped in to the mortgage mess, we're basically dealing with government entities. More paperwork, more steps to the process, ...

3. Lawyers are also involved. Their fees and billable hours will be collected regardless of if the property sells. They do not share the same motivation to complete the transaction in a timely manner that a Realtor does.

4. They entail spending hours on the phone calling a lender's mitigation department in hopes of reaching someone who can answer questions and/or has the authority to release information and/or give a definitive answer to a question (like when can we close?). Three months of aggravation to have the lender tell us that our offer is rejected is not a productive use of my time.

5. They involve 5 times the work for half (or none) of the pay. The lender selling the property will often discount the commission to the buyer's agent at the 11th hour. Not wanting to let the commission get in the way of getting your buyer the property they want, the agent takes what they can get at that point. They are stuck with what the bank wants to pay them instead of being fairly compensated for their work.

6. I don't like being the bad guy. The lender is taking a loss on their investment and I'm nagging them for decisions. The seller isn't making a dime on their sale and I'm pushing them to help get it sold. Many folks feel like the Realtor is the only one making money on the deal. They often think 'If we're not making anything on this, why should you?'. I didn't take the risk of buying or lending on this property. And I shouldn't be forced to work for nothing (#1 reason why I no longer do short sales).

7. My blood pressure can't take it when the bank requests completely updated documents and paperwork because they delayed so long in responding. Now that months have passed, the financial information isn't current. They need updated paperwork from both buyer and seller. Some how they also manage to lose paperwork (they often prefer to work with faxed documents instead of emailed documents).

8. Buyers get frustrated and go away. Who wouldn't? Unfortunately they often think it is their agent's fault and don't want to work with that agent any more. I steer buyer clients away from short sales because it is not in their best interest to pursue them.

9. We're stuck in the middle. Loss mitigators at the banks are overwhelmed and don't have time to take my calls or call me back. Buyers want to take advantage of this buyers market and purchase a property at the best terms - they don't want to sit on their hands for months waiting to do that. Sellers want to avoid foreclosure and irreparable damage to their credit. Realtors want to make it happen for everyone and get paid for their work.

10. There is usually nothing the agent can do to speed the process. We can't make the lender become reasonable or flexible, we can't reduce the paperwork or the time to get an approval or rejection, ... Everything is in the hands of the bank and the seller. But mostly the bank. Did I mention that the government is now controlling many of these financial institutions? Go back to reason #1.

This photo better than nun?

I constantly preach that one of the most important aspects of marketing a property for sale is to plaster several good photos of the property all over the internet. Buyers want to see photos. Lots of photos.

This lovely home just is on the market in north Dallas with a reputable brokerage. You can probably guess from the photo that it was listed around July 4th.

The listing includes 5 photos (not great but better than nothing). However, the really odd thing is the photo of the kitchen.

The caption reads: "Home has been blessed by God's servants."

The MLS rules for placing photos of properties states that photos and their descriptions may not have "any text that is not descriptive in nature and relevant to the portrayal of the listed property".

I guess the relevancy of nuns blessing a property could be a matter of opinion.

What do you think? Is this picture a blessing or a curse when it is one of 5 photos showing the property?

[where: 75230]

Too hot to look at homes?

We've hit that time of year in Dallas when showings typically drop. The 100+ degree days. Anyone out looking at homes right now is usually pretty serious.

Three of the homes that I have listed for sale were held open this weekend. Not much traffic through homes at the higher prices. Seems the first time homebuyer tax incentive is driving a lot of people to consider purchasing in the price ranges under $350,000.

There are enough fantastic deals out there right now, that I'd step out into the heat for them. It will be interesting to see if anyone else does next weekend.

[where: 75230]

5 Biggest Blunders Sellers Make

Want to sell your home?

Make it easy on yourself and me by avoiding these money-loosing pitfalls. Trust me, I'm a doctor (when it comes to these things).

1. Messiness. Get rid of the clutter and knick-knacks. If you can't sit on it or use it, its clutter. Buyers should walk in to your home and say "I want to live like this. There is room for my stuff here." When there is too much of your stuff, they can't imagine their stuff there. Plus, it feels like there isn't enough storage in the house.

2. Dirtiness. Byers don't care if you have kids and/or pets. They are turned off by a dirty house. Clean from top to bottom and it will make the difference between a sale or not. Elbow grease goes a long way. Make it sparkle.

3. Deferred maintenance. Fix it. Cracks, holes, anything broken or damaged. No one wants to buy work. Your deferred maintenance = work for the buyer.

4. Unappealing paint colors or wallpaper. Neutral colors sell. Paint is money in a can.

5. Unpleasant smells. Pets, cooking odors, ... People want to be in a fresh, clean home. Open the windows, boil cinnamon, use scented paint, ... Avoid flowery fragrances. Vanilla or 'fresh linen' scent works best.

[where: 75230]

New Restrictions Slowing Home Sales

The National Association of Realtors sent out an update this morning addressing the problems caused by the new Home Valuation Code of Conduct. The HVCC is an agreement between the two secondary mortgage market companies Fannie Mae and Feddie Mac and the State of New York. The intent was to stop the kind of inaccurate appraisals that helped cause the housing meltdown.

But, as the NAR tells us: “HVCC has turned out to be a problem in its own right, judging from everything we’re hearing, and not just for real estate deals in New York. The two mortgage companies are applying HVCC rules to all mortgages they handle, regardless of state, so any problems with HVCC are nationwide in scope.

Here’s a sample of what our researchers found:

• 76 percent of practitioners say the time to obtain a completed appraisal increased after May 1 (the date of HVCC implementation), with 69 percent of those saying the increase has been more than eight days.
• 37 percent says sales have been lost because of the appraisal rules, with 20 percent saying they’ve lost multiple sales. This is especially unfortunate, since market data suggests we have pent-up demand for housing.
• 70 percent say out-of-area appraisers have been used. This is important because our members say out-of-area appraisers can’t be counted on to have intimate knowledge of a market and can therefore miss details on comparables and other facts that can affect price.

NAR President Charles McMillan last week had meetings with the attorney general’s office in New York and with the Federal Housing Finance Agency (Fannie and Freddie’s conservator). The two mortgage companies were in that meeting with FHFA as well, as were appraisers.

Congress is aware of the issue. There’s even a bill (H.R. 3044) to impose an 18-month moratorium on HVCC, but it’s unclear what will happen with that, since Congress is focused on health care reform this summer. (If you want to look at the bill, go to Congress.gov and search “H.R. 3044.”)”

[where: 75230]

Preston Hollow Patriotism

The Preston Hollow North Homeowners Association held their annual 4th of July parade and celebration this morning. As you can see from the photos, it was a fun & festive occasion.

Additional photos of this event will be posted at http://www.prestonhollowjuly4th.com/ by Monday afternoon.

[where: 75230]

Check Out Your Competition

Prior to listing your home for sale, I always recommend checking out the other homes in your area that will be your competition.

If you want to get top dollar for your property, you need to be the top house in the neighborhood. The only way to know if you are is to check out the other homes in your area. Visit open houses or have your agent take you to see a few homes that are similar size and/or similar price to yours. Even though you love your own home, try to be objective and think like a typical buyer who is spending the amount you want for your house.

Every buyer that is coming into your house is also going to view these other homes. If their kitchens and baths are remodeled and yours isn't, then you need to either update it to the level of the other homes or lower your price to make up for it.

Listen to comments as people are walking through these homes and you'll hear what is important to buyers in your area and what they expect. Too often sellers think their property has extra amenities that should raise their asking price. Often they are surprised to find out that their 'upgrades' simply meet the standard expectations of buyers. Visiting homes on the market in your neighborhood will help determine how you stack up. While you're at it, check out how the homes are being marketed (both inside the property and on-line).

Typically, I view homes in my area (on a weekly basis) when they come on the market. I know what the competition is like. As a seller, you should too. Then you'll know how you rank with the competition.

You've got one shot at getting the buyers to love your house over the competition. Get it right and you won't have to worry about the competition any more. [where: 75230]