I'm a big walker. And I'm a big believer in planning cities (read-suburbs) with downtown areas that promote living and working in close proximity. With today's service and information economy, it is more possible than ever.
The editorial/opinion column below addresses this issue in a fun way, if not in very simple terms. The author fails to speak of the economic and governmental differences that dictate city planning to some extent. But city planning and how we live and interact is a great topic for discussion.
With the Dan Ryan construction project starting at the time of this writing, it's as good a time as ever to question our driving tendencies.
Friday, March 31, 2006 Inman News]]> We Americans are a puzzling bunch. We travel to Italy, France or Spain and come back smitten with the charmingly walk-able streets, close-knit houses, and humanly scaled public spaces we find there. Yet we seldom stop to wonder why our own built environment is so utterly lacking in those traits.
It's no mystery: In spite of rising population and dwindling resources, America remains saddled with long outdated planning ideals that are the furthest thing from the European examples we admire so much.
America is a vast nation, and perhaps in consequence, our planners and engineers have historically been trained to think big. This tendency has produced some magnificent civil engineering projects such as railways, dams and bridges. Yet it hasn't been nearly so successful at the scale of human habitation.
Thanks to the megalomania of our traffic engineers, for example, American cities are among the least pedestrian-friendly in the world. Each year, larger and larger swaths of urban and suburban land are paved over with ubiquitous six-lane thoroughfares bristling with redundant arrays of traffic signals. Aside from creating barren, monotonous and alienating cityscapes, such roads are also daunting barriers to people on foot, no matter how many kinds of whiz-bang pedestrian signals we install. Rather than drawing our cities together, our roads tear them apart, providing one more incentive for Americans to drive instead of walk.
Ironically, in the dwindling number of places where human-scaled roads still remain, city engineers are even now scrambling to widen them, always with the specious objective of easing congestion. Yet as both traffic studies and common sense can easily confirm, this so-called improvement is pure bunk. The only thing America's incessant street widening programs really do--aside from keeping paving contractors in clover--is to invite even more automobile traffic.
Europeans are notably less obsessed with road widening. Unlike us, they recognize that the difficulty of negotiating their picturesque streets in a car is a blessing in disguise: It makes people prefer to take public transit, or to simply live within walking distance of their jobs. In short, Europeans design their cars to suit their cities, whereas we design our cities to suit our cars.
As for our homes, the much-adored human scale of European villages is all but unheard of in suburban America. This is no accident, either--our neighborhoods can't help but be coarsely scaled, since our moribund zoning regulations typically still insist that houses be surrounded by useless strips of setback land.
The custom of spacing buildings far apart may have made sense a hundred years ago, when America was an agricultural nation and land was cheap and plentiful. Yet that day is long past. With today's usual practice of shoehorning huge tract homes into postage-stamp building lots, the resulting sunless, 10-foot-wide gap left between houses has only one function: to let developers fetch higher prices by continuing to sell their units as "single-family detached."
In older European towns, by contrast, even houses in wide-open rural areas are often clustered together in villages, their walls adjoining. The cumulative savings in otherwise useless setback land can then be devoted to public space that actually has some purpose.
The need to prize every little scrap of land has been central to Europe's way of building for centuries. But it's a lesson we Americans have yet to learn. When it comes to our professed admiration for Europe's charms, we talk the talk, but we sure don't walk the walk.
Friday, March 31, 2006
Consumer confidence not an oxymoron
Friday, March 31, 2006 Inman NEWS:
Consumer confidence rose in the latest survey largely due to gains among households with incomes above $50,000, and the majority of consumers expect the Federal Reserve to continue to raise overnight interest rates, according to the University of Michigan's Survey of Consumers.
"Higher-income households much more frequently reported that their finances had improved and more frequently anticipated further gains during the year ahead," according to Richard Curtin, director of the survey.
Three out of four consumers in the March survey said they expected continued interest-rate hikes, and consumers emphasized the importance of price discounts to their buying plans for everything from homes, to vehicles, to household appliances and furniture. The discounts were seen as critical to offset the higher costs of credit, according to the survey.
While personal consumption expenditures are expected to grow by nearly 3 percent during 2006, new residential investment is expected to decline. "The critical issue is how much of the weakness in the home market spreads to other purchases via reduced cash-outs of home equity," said Curtin. The size and frequency of cashouts depend on changes in home prices and mortgage rates, with changes in both expected to limit cash-outs.
The index of consumer sentiment was 88.9 in the March 2006 survey, between the 86.7 recorded in February and the 92.6 recorded in last March’s survey. The index of consumer expectations, a closely watched component of the index of leading economic indicators, rose to 76 in March, slightly ahead of the 74.5 in February, but well below the 82.8 recorded in March of 2005. The current economic conditions index was 109.1 in March, up from 105.6 in February and 108 in March of 2005.
The March gain in the sentiment index among households with incomes above $50,000 was 5.1 index points, while among households with incomes under $50,000, the sentiment index fell by 0.4 index points.
"Upper income households were half as likely as lower income families to report that their financial situation had been significantly weakened by higher prices, and higher income households were three times as likely to anticipate increases in their real incomes during the year ahead," Curtin noted. The gap in financial prospects between those households with above median incomes and below median incomes has never been wider during the past decade.
There was evidence of a growing belief across all households that the pace of economic growth would slow in the second half of 2006. "Despite the expected slowdown in the pace of growth, most consumers do not expect bad economic times, but they do anticipate that the unemployment rate will begin to inch upward," according to Curtin. Half of all consumers in the March survey expected an economic downturn sometime during the next five years, however.
Source: Inman News
Consumer confidence rose in the latest survey largely due to gains among households with incomes above $50,000, and the majority of consumers expect the Federal Reserve to continue to raise overnight interest rates, according to the University of Michigan's Survey of Consumers.
"Higher-income households much more frequently reported that their finances had improved and more frequently anticipated further gains during the year ahead," according to Richard Curtin, director of the survey.
Three out of four consumers in the March survey said they expected continued interest-rate hikes, and consumers emphasized the importance of price discounts to their buying plans for everything from homes, to vehicles, to household appliances and furniture. The discounts were seen as critical to offset the higher costs of credit, according to the survey.
While personal consumption expenditures are expected to grow by nearly 3 percent during 2006, new residential investment is expected to decline. "The critical issue is how much of the weakness in the home market spreads to other purchases via reduced cash-outs of home equity," said Curtin. The size and frequency of cashouts depend on changes in home prices and mortgage rates, with changes in both expected to limit cash-outs.
The index of consumer sentiment was 88.9 in the March 2006 survey, between the 86.7 recorded in February and the 92.6 recorded in last March’s survey. The index of consumer expectations, a closely watched component of the index of leading economic indicators, rose to 76 in March, slightly ahead of the 74.5 in February, but well below the 82.8 recorded in March of 2005. The current economic conditions index was 109.1 in March, up from 105.6 in February and 108 in March of 2005.
The March gain in the sentiment index among households with incomes above $50,000 was 5.1 index points, while among households with incomes under $50,000, the sentiment index fell by 0.4 index points.
"Upper income households were half as likely as lower income families to report that their financial situation had been significantly weakened by higher prices, and higher income households were three times as likely to anticipate increases in their real incomes during the year ahead," Curtin noted. The gap in financial prospects between those households with above median incomes and below median incomes has never been wider during the past decade.
There was evidence of a growing belief across all households that the pace of economic growth would slow in the second half of 2006. "Despite the expected slowdown in the pace of growth, most consumers do not expect bad economic times, but they do anticipate that the unemployment rate will begin to inch upward," according to Curtin. Half of all consumers in the March survey expected an economic downturn sometime during the next five years, however.
Source: Inman News
Thursday, March 30, 2006
Buying tips music to my ears
When I meet home shoppers at my open houses or online, I try to communicate certain aspects that will provide a smooth process. The number one thing I plead new clients to do is meet with their bank or a good mortgage broker before looking at places. When this subject is brought up, many first time buyers who just started looking respond that they have not met with anyone, but will when they get serious.
This is backward thinking. To get serious, you must work with your bank and mortgage broker to fine tune your finances. Understanding your finances, the loan products available, the price point you may purchase in, and the homes available at that range will provide you a much better experience.
The story written below is a fantastic third party view of what I'm talking about. So, when we work together, you know I will be very adament about your understanding and executing the steps involved in home buying. You will find a home you will love and that will help you on the road to a better financial position. But you must be ready to go for it when that home comes along. I'll prep you for sure.
Monday, March 27, 2006 Inman News]]> If you postponed buying a home during recent years, or found yourself unable to buy due to fierce competition from other buyers, now could be the window of opportunity you've been waiting for. Interest rates, although gradually rising, are still low. And, generally, the inventory of homes for sale is increasing.
The first step is to find out how much you can afford to pay by talking with a mortgage broker or lender. Knowing your price range will help you to determine whether you can afford to buy a single-family residence or a condominium. Condos tend to be less expensive. Your price range will also dictate the neighborhoods in which you'll be able to buy.
HOUSE HUNTING TIP: It's wise to get pre-approved for the mortgage you'll need to complete the purchase. In order to get pre-approved, you'll need to complete a loan application and have your credit checked. This takes time so if you aren't already hooked up with a mortgage person, interview several before you go through the pre-approval process.
Ask each person you interview to explain your mortgage options. There are countless mortgage products available, but some are riskier than others. Find a mortgage broker or loan agent who will take the time to explain the pros and cons of the various mortgage options in words you understand.
Pre-approval can make a big difference in your negotiations with the seller. Recently, an Oakland Hills, Calif., seller received two outstanding offers. One was accompanied by a pre-approval letter that included underwriting approval from the lender and verification of the buyers' funds for the down payment and closing costs. The second offer was presented with a letter from the buyers' mortgage broker that didn't include underwriting approval and was subject to verification of the buyers' funds needed to close. The sellers accepted the first offer.
The next step is to find a good real estate agent. This doesn't necessarily mean the agent who sells the most property. Your agent should be ethical, professional, trustworthy and diligent, and should specialize in the area where you want to live. Other key attributes are good negotiation skills and a willingness to commit time and attention to your needs.
It's helpful to prepare a wish list of all the features you'd ideally like in a home. Share this list with your agent and get feedback on how realistic it is. Buying a home will inevitably involve compromise. Fine-tune the list after you have incorporated your agent's input. Determine which items on the list are must-haves and which ones you can do without.
Now you're ready to start your search. How long this will take depends on what you're looking for and whether it's readily available.
In areas where there is a glut of listings on the market, you'll have an easier time finding a home and there will be more opportunity to negotiate on the price and terms.
In low-inventory markets, you may find yourself in competition. However, unlike last year, it appears that multiple offers in today's market aren't necessarily boosting the price considerably over the asking price.
Where inventories are skimpy, you'll have more success if you relax your search parameters and broaden your horizons. For instance, you might look in more than one area or be more flexible on the architectural style you're willing to accept.
Don't overlook listings that have been on the market for a while. The sellers might be open to negotiating. And keep an eye open for price reductions. Most buyers concentrate on listings that are new on the market.
THE CLOSING: A better deal might be made on a listing that isn't drawing a lot of attention.
Dian Hymer is the author of this column
This is backward thinking. To get serious, you must work with your bank and mortgage broker to fine tune your finances. Understanding your finances, the loan products available, the price point you may purchase in, and the homes available at that range will provide you a much better experience.
The story written below is a fantastic third party view of what I'm talking about. So, when we work together, you know I will be very adament about your understanding and executing the steps involved in home buying. You will find a home you will love and that will help you on the road to a better financial position. But you must be ready to go for it when that home comes along. I'll prep you for sure.
Monday, March 27, 2006 Inman News]]> If you postponed buying a home during recent years, or found yourself unable to buy due to fierce competition from other buyers, now could be the window of opportunity you've been waiting for. Interest rates, although gradually rising, are still low. And, generally, the inventory of homes for sale is increasing.
The first step is to find out how much you can afford to pay by talking with a mortgage broker or lender. Knowing your price range will help you to determine whether you can afford to buy a single-family residence or a condominium. Condos tend to be less expensive. Your price range will also dictate the neighborhoods in which you'll be able to buy.
HOUSE HUNTING TIP: It's wise to get pre-approved for the mortgage you'll need to complete the purchase. In order to get pre-approved, you'll need to complete a loan application and have your credit checked. This takes time so if you aren't already hooked up with a mortgage person, interview several before you go through the pre-approval process.
Ask each person you interview to explain your mortgage options. There are countless mortgage products available, but some are riskier than others. Find a mortgage broker or loan agent who will take the time to explain the pros and cons of the various mortgage options in words you understand.
Pre-approval can make a big difference in your negotiations with the seller. Recently, an Oakland Hills, Calif., seller received two outstanding offers. One was accompanied by a pre-approval letter that included underwriting approval from the lender and verification of the buyers' funds for the down payment and closing costs. The second offer was presented with a letter from the buyers' mortgage broker that didn't include underwriting approval and was subject to verification of the buyers' funds needed to close. The sellers accepted the first offer.
The next step is to find a good real estate agent. This doesn't necessarily mean the agent who sells the most property. Your agent should be ethical, professional, trustworthy and diligent, and should specialize in the area where you want to live. Other key attributes are good negotiation skills and a willingness to commit time and attention to your needs.
It's helpful to prepare a wish list of all the features you'd ideally like in a home. Share this list with your agent and get feedback on how realistic it is. Buying a home will inevitably involve compromise. Fine-tune the list after you have incorporated your agent's input. Determine which items on the list are must-haves and which ones you can do without.
Now you're ready to start your search. How long this will take depends on what you're looking for and whether it's readily available.
In areas where there is a glut of listings on the market, you'll have an easier time finding a home and there will be more opportunity to negotiate on the price and terms.
In low-inventory markets, you may find yourself in competition. However, unlike last year, it appears that multiple offers in today's market aren't necessarily boosting the price considerably over the asking price.
Where inventories are skimpy, you'll have more success if you relax your search parameters and broaden your horizons. For instance, you might look in more than one area or be more flexible on the architectural style you're willing to accept.
Don't overlook listings that have been on the market for a while. The sellers might be open to negotiating. And keep an eye open for price reductions. Most buyers concentrate on listings that are new on the market.
THE CLOSING: A better deal might be made on a listing that isn't drawing a lot of attention.
Dian Hymer is the author of this column
Monday, March 27, 2006
Mortgage rates holding
The Chicago Association of Realtors reports avergae 30 year fixed mortgage rates at 6.07% by days today. Not bad. If your close to a decision on a place, this could be a good week to lock in your rate for up to 60 days without paying an outrageous rate lock fee.
Rates have been holding steady, but mortgage bankers and real esates economists predict the dreaded 7% by the end of the summer. Just remeber this spring that there are great properties going on the market, sellers are reasonable, and rates are still low.
Rates have been holding steady, but mortgage bankers and real esates economists predict the dreaded 7% by the end of the summer. Just remeber this spring that there are great properties going on the market, sellers are reasonable, and rates are still low.
Sunday, March 26, 2006
Bucktown: When it feels right
The Bucktown area has been one of the hottest neighborhoods this spring. It seems the properties here have sold faster than most. My clients have experienced this lately. On several occassions, a well placed and priced unit in this area has sold before they had a chance to look at it.
It isn't an exact science, but a good Realtor can sense a steal. When the stars are lining up-- my client likes the place, the price is good in market terms, the seller is motivated and the seller's agent is handing over information that favors my buyer (yikes!), --a Realtor you trust usually can negotiate a fair transaction.
Look, it's not my job to tell you what to like. But there will be times that I suggest a unit is well laid out, has certain valuable features, and is in a great location. Taste is one thing, quality entirely different.
So take heed if you view a home in Bucktown that looks good and feels right, make a move. There is always the inspection period and several contingencies left to protect your interest. Because a good unit probably won't be there tomorrow. Or worse, you'll find yourself in a multiple offer situation!
The moral: Make sure you have mapped out your mortgage product and understand the expenses involed in buying a home. This will enable you to move fast when the right home comes along.
It isn't an exact science, but a good Realtor can sense a steal. When the stars are lining up-- my client likes the place, the price is good in market terms, the seller is motivated and the seller's agent is handing over information that favors my buyer (yikes!), --a Realtor you trust usually can negotiate a fair transaction.
Look, it's not my job to tell you what to like. But there will be times that I suggest a unit is well laid out, has certain valuable features, and is in a great location. Taste is one thing, quality entirely different.
So take heed if you view a home in Bucktown that looks good and feels right, make a move. There is always the inspection period and several contingencies left to protect your interest. Because a good unit probably won't be there tomorrow. Or worse, you'll find yourself in a multiple offer situation!
The moral: Make sure you have mapped out your mortgage product and understand the expenses involed in buying a home. This will enable you to move fast when the right home comes along.
Wednesday, March 22, 2006
Wine Tasting Tonight! Wednesday, March 22nd 7PM
Tonight we'll take a moment to thank clients and to discuss the options of future home buyers and sellers. There are no presentations, just a casual evening with wine and appetizers. But the opportunity to talk realistically about a home purchase and the process involved is invaluable. This is our way of making a sometimes streesful process a little easier.
Hope to see you.
Because the event is at a private residence, please call for more details.
Eric Rojas
773-510-1597
Hope to see you.
Because the event is at a private residence, please call for more details.
Eric Rojas
773-510-1597
Sunday, March 19, 2006
Client Testimonial: Music to my Ears
Thanks for the kind words!
I met my client Jeremy at an Open House and, as a result, had me represent him in his first real estate transaction. As an orthopedic surgeon, with a busy work and travel schedule, Jeremy needed response to his irregular hours. I'm glad he appreciated the access and instant communication during the home purchase process. Ask me about Jeremy's transaction, and about any other of my clients, to learn about the experience that will help you next.
A+
-Jeremy S.
I met my client Jeremy at an Open House and, as a result, had me represent him in his first real estate transaction. As an orthopedic surgeon, with a busy work and travel schedule, Jeremy needed response to his irregular hours. I'm glad he appreciated the access and instant communication during the home purchase process. Ask me about Jeremy's transaction, and about any other of my clients, to learn about the experience that will help you next.
(Reprinted with client permission)
"Eric was my Realtor- he helped me buy my first condo. He was tremendously helpful at every step- he only showed me the types of property I was intetested in (all within my price range), he helped me negotiate a great price, walked me through escrow, and sat with me at the closing table".A+
-Jeremy S.
Thursday, March 16, 2006
Real Estate Rates Simmer Down
I'm watching rates... they may go up as the year goes on. But, there is still time to take advantage of historically low mortgage rates. This spring will allow buyers to bargain hard, but sellers take heart; nice properties are in demand and good rates will be had on your next place.
Thursday, March 16, 2006
Long-term mortgage interest rates continued lower Wednesday, and the benchmark 10-year Treasury bond yield gained to 4.73 percent.
The 30-year fixed-rate average dipped to 5.91 percent, and the 15-year fixed-rate sank to 5.59 percent. The 1-year adjustable was down at 4.88 percent.
The 30-year Treasury bond yield increased to 4.75 percent.
Rates are current as of 7:15 p.m. Eastern Standard Time.
Thursday, March 16, 2006
Long-term mortgage interest rates continued lower Wednesday, and the benchmark 10-year Treasury bond yield gained to 4.73 percent.
The 30-year fixed-rate average dipped to 5.91 percent, and the 15-year fixed-rate sank to 5.59 percent. The 1-year adjustable was down at 4.88 percent.
The 30-year Treasury bond yield increased to 4.75 percent.
Rates are current as of 7:15 p.m. Eastern Standard Time.
Real Estate Rates Simmer Down
I'm keeping an eye on rates... they will be higher as the year goes on, but there is still time to get historically low mortage interest rates.
Thursday, March 16, 2006
Long-term mortgage interest rates continued lower Wednesday, and the benchmark 10-year Treasury bond yield gained to 4.73 percent.
The 30-year fixed-rate average dipped to 5.91 percent, and the 15-year fixed-rate sank to 5.59 percent. The 1-year adjustable was down at 4.88 percent.
The 30-year Treasury bond yield increased to 4.75 percent.
Rates are current as of 7:15 p.m. Eastern Standard Time.
Thursday, March 16, 2006
Long-term mortgage interest rates continued lower Wednesday, and the benchmark 10-year Treasury bond yield gained to 4.73 percent.
The 30-year fixed-rate average dipped to 5.91 percent, and the 15-year fixed-rate sank to 5.59 percent. The 1-year adjustable was down at 4.88 percent.
The 30-year Treasury bond yield increased to 4.75 percent.
Rates are current as of 7:15 p.m. Eastern Standard Time.
Monday, March 13, 2006
1141 West Patterson... Hottest Development in Wrigleyville
I opened a new development of ours this weekend at 1141 West Patterson. It was absolutley the busiest open house I have had this season. The location is a stones throw from Cub's Park, but actually sits on a quiet one-way street. During game days, Chicago's finest re-directs traffic around the street.
Five units with four different floor plans. Two duplex-downs with radiated heat floors, a duplex penthouse, a simplex penthouse, and a simplex two bedroom, two bathroom. I ran the comps last night for interested buyers and found there is nothing else like it. The two Penthouse units have everything... 3 bedrooms, garage parking, top finishes (still selectable) private roof top rights (huge!), interesting floorplans, multiple decks, location, location, location.
If you review my blog, I have not really been this excited about one of our developments. The difference was the response from buyers taking a look. Most came directly from viewing one of our various advertisements suggesting specific demand for brand-new construction in Wrigleyville.
These will go fast. In fact, I have had a request to review the builder's contract already. Again, the big difference is the energy surrounding this place. Many times I work with clients in which many, many units have everything they want... making the decison tough. These units are truly unique, if not for the lay-outs alone, but location and roof top views in a truly historic neighborhood.
I'll be there next weekend as well and hope the buyers I met this weekend will capatalize on the opportunity. It's a no brainer this time.
Five units with four different floor plans. Two duplex-downs with radiated heat floors, a duplex penthouse, a simplex penthouse, and a simplex two bedroom, two bathroom. I ran the comps last night for interested buyers and found there is nothing else like it. The two Penthouse units have everything... 3 bedrooms, garage parking, top finishes (still selectable) private roof top rights (huge!), interesting floorplans, multiple decks, location, location, location.
If you review my blog, I have not really been this excited about one of our developments. The difference was the response from buyers taking a look. Most came directly from viewing one of our various advertisements suggesting specific demand for brand-new construction in Wrigleyville.
These will go fast. In fact, I have had a request to review the builder's contract already. Again, the big difference is the energy surrounding this place. Many times I work with clients in which many, many units have everything they want... making the decison tough. These units are truly unique, if not for the lay-outs alone, but location and roof top views in a truly historic neighborhood.
I'll be there next weekend as well and hope the buyers I met this weekend will capatalize on the opportunity. It's a no brainer this time.
Friday, March 10, 2006
Overpricing? Overated!
I try to list homes at the top of the market and follow it up with full brokerage services. But another study suggests that you should not push the envelope to far.
INMAN NEWS Thursday, March 09, 2006
Overpricing is the number one mistake home sellers said they made when listing their homes, according to a new national e-mail survey conducted by HouseHunt. The margin was nearly three-to-one over the second choice, HouseHunt reported.
Survey respondents said their next-biggest mistake was "dealing with the same real estate agent who represented the buyer," thereby setting up a possible conflict of interest and possibly a perception that the buyer was getting a better deal.
The third-biggest mistake noted by the nearly 400 survey participants was "failure to disclose known defects or problems." Virtually tied for fourth place were: "underpricing their properties" and "not utilizing Internet technology to market their properties."
"With the rapid price appreciation we've seen in many housing markets across the country, it's not surprising that home seller expectations sometimes outran market reality," said Michael Bearden, president and CEO of HouseHunt, which provides information to consumers across the United States through its two primary Web sites, HouseHunt.com and moveUp.com.
INMAN NEWS Thursday, March 09, 2006
Overpricing is the number one mistake home sellers said they made when listing their homes, according to a new national e-mail survey conducted by HouseHunt. The margin was nearly three-to-one over the second choice, HouseHunt reported.
Survey respondents said their next-biggest mistake was "dealing with the same real estate agent who represented the buyer," thereby setting up a possible conflict of interest and possibly a perception that the buyer was getting a better deal.
The third-biggest mistake noted by the nearly 400 survey participants was "failure to disclose known defects or problems." Virtually tied for fourth place were: "underpricing their properties" and "not utilizing Internet technology to market their properties."
"With the rapid price appreciation we've seen in many housing markets across the country, it's not surprising that home seller expectations sometimes outran market reality," said Michael Bearden, president and CEO of HouseHunt, which provides information to consumers across the United States through its two primary Web sites, HouseHunt.com and moveUp.com.
Tuesday, March 07, 2006
Home Sale Tips... I'm not making this stuff up
Great tips for this spring market
Monday, March 06, 2006 Inman News]]> Sellers often order pre-sale inspection reports. This inevitably raises the question of how much, if any, of the recommended work should be done before selling.
Ideally, any defect that would be hazardous to agents and buyers who preview the property during the sale process should be corrected. An example is a trip hazard that might cause someone to fall. In addition, to maximize your return from the sale, you should repair defects that adversely affect how the property looks.
First impressions are important. So, if the fence or entry porch are rotted and look shabby, repair them. If the exterior paint is peeling, repaint. You get a big payback when you repair a defect and improve appearance by doing so.
For example, let's say that the wood pest (also known as termite) inspector finds dry rot under the linoleum in a bathroom. If the linoleum is worn and outdated, you'll do better on the sale if you replace the floor covering with a new, trendier one. In the course of doing this, the wood rot can be repaired. The result is that the house shows better and a defect is eliminated--two benefits for the price of one.
Recently, a pest inspector who did a pre-sale inspection on a Piedmont, Calif., home found dry rot and fungus in a glass-and-wood container that ran from the floor to the ceiling through the end of the family room. The container was constructed to surround a birch tree. The tree subsequently died. The container no longer served a function, obstructed a beautiful outlook, and looked weird. The seller had it removed before selling the house, eliminating the eyesore and the wood damage.
You certainly can't be expected to rebuild your home in order to sell it. Nor is this a sensible thing to do economically. The same Piedmont, Calif., house mentioned above had a deck that looked OK and wasn't unsafe. But there was dry rot and fungus damage scattered throughout the deck. The only way to repair the deck was to replace it. It would be difficult to get the job done in the timeframe in which the seller wanted to sell.
The deck was old and no longer met current code requirements. It would have had to be redesigned. So the seller decided to leave the deck as it was and disclose that the deck needed to be replaced. The future owners could have the new deck designed to meet their needs at a later date.
When structural elements are in need of repair and you haven't the time or money to repair them, it's a good idea to get repair estimates and make these estimates available to prospective buyers before they make an offer. This way, you're in control of the process and can find reliable contractors or engineers who will give you reasonable and not exorbitant estimates.
It can be unsettling to a buyer to discover that the roof is shot or the foundation needs work. Most buyers will have no idea how much it will cost to make repairs. Fear of the unknown makes people anxious, which isn't a good frame of mind for someone who's trying to decide whether to buy your home.
A pre-sale home inspector of an Oakland, Calif., home recommended that an engineer be consulted about a foundation that had settled. The seller hired an engineer who made a proposal for the repair. The cost was $20,000--not an insignificant number. But, it wasn't $40,000 or $50,000 as an inexperienced buyer might imagine
THE CLOSING: If you choose not to make major repairs before selling, this should be reflected in your list price, especially if you have competition from other sellers.
Monday, March 06, 2006 Inman News]]> Sellers often order pre-sale inspection reports. This inevitably raises the question of how much, if any, of the recommended work should be done before selling.
Ideally, any defect that would be hazardous to agents and buyers who preview the property during the sale process should be corrected. An example is a trip hazard that might cause someone to fall. In addition, to maximize your return from the sale, you should repair defects that adversely affect how the property looks.
First impressions are important. So, if the fence or entry porch are rotted and look shabby, repair them. If the exterior paint is peeling, repaint. You get a big payback when you repair a defect and improve appearance by doing so.
For example, let's say that the wood pest (also known as termite) inspector finds dry rot under the linoleum in a bathroom. If the linoleum is worn and outdated, you'll do better on the sale if you replace the floor covering with a new, trendier one. In the course of doing this, the wood rot can be repaired. The result is that the house shows better and a defect is eliminated--two benefits for the price of one.
Recently, a pest inspector who did a pre-sale inspection on a Piedmont, Calif., home found dry rot and fungus in a glass-and-wood container that ran from the floor to the ceiling through the end of the family room. The container was constructed to surround a birch tree. The tree subsequently died. The container no longer served a function, obstructed a beautiful outlook, and looked weird. The seller had it removed before selling the house, eliminating the eyesore and the wood damage.
You certainly can't be expected to rebuild your home in order to sell it. Nor is this a sensible thing to do economically. The same Piedmont, Calif., house mentioned above had a deck that looked OK and wasn't unsafe. But there was dry rot and fungus damage scattered throughout the deck. The only way to repair the deck was to replace it. It would be difficult to get the job done in the timeframe in which the seller wanted to sell.
The deck was old and no longer met current code requirements. It would have had to be redesigned. So the seller decided to leave the deck as it was and disclose that the deck needed to be replaced. The future owners could have the new deck designed to meet their needs at a later date.
When structural elements are in need of repair and you haven't the time or money to repair them, it's a good idea to get repair estimates and make these estimates available to prospective buyers before they make an offer. This way, you're in control of the process and can find reliable contractors or engineers who will give you reasonable and not exorbitant estimates.
It can be unsettling to a buyer to discover that the roof is shot or the foundation needs work. Most buyers will have no idea how much it will cost to make repairs. Fear of the unknown makes people anxious, which isn't a good frame of mind for someone who's trying to decide whether to buy your home.
A pre-sale home inspector of an Oakland, Calif., home recommended that an engineer be consulted about a foundation that had settled. The seller hired an engineer who made a proposal for the repair. The cost was $20,000--not an insignificant number. But, it wasn't $40,000 or $50,000 as an inexperienced buyer might imagine
THE CLOSING: If you choose not to make major repairs before selling, this should be reflected in your list price, especially if you have competition from other sellers.
March 22nd Wine Tasting Party
A get together with past, present and future clients. March 22nd from 7P to10P. Email or call for details.
Eric 773-510-1597
EROJAS@CHEmail.com
Eric 773-510-1597
EROJAS@CHEmail.com
Social Benefits of Home Ownership
Some of my clients can attest to my "preaching" when it comes to owning a home. I whole- heartedly understand the economics of owning. But, when I meet a client, I like to discuss why they are buying. These are value based decisions really. And I'll go on the record to suggest we act and feel differently when we own... and this is a good thing.
I find the following study very interesting. As a political science nerd in college, these are the things we really sink our teeth into when deciding policy. Take a look...
http://www.realtor.org/Research.nsf/pages/homeownershipbenefits
I find the following study very interesting. As a political science nerd in college, these are the things we really sink our teeth into when deciding policy. Take a look...
http://www.realtor.org/Research.nsf/pages/homeownershipbenefits
House Appreciation Still Strong
Although I value many of the social aspects of owning, in addition to the economic sense, this latest study shows home appreciation remains strong. I am a strong believer any couple paying over $1000/month in rent plus utilities, should own a place here in Chicago. Just choose the right place for you... with my help.
Monday, March 06, 2006
House-price appreciation continued at a robust pace at the end of 2005, with average home prices increasing 12.95 percent from the fourth quarter 2004 through the fourth quarter 2005, according to the Office of Federal Housing Enterprise Oversight.
Appreciation for the most recent quarter was 2.86 percent, or an annualized rate of 11.4 percent, according to OFHEO's figures released last week. The increase during 2005 is similar to the revised increase of 12.55 percent for the year ended with the third quarter of 2005, showing no evidence of a slowdown in average prices.
"Despite recent indications that a slowdown may be forthcoming, house-price appreciation during 2005 continued to hover at near-record levels," said OFHEO Chief Economist Patrick Lawler.
House prices continued to grow considerably faster over the past year than did prices of non-housing goods and services reflected in the Consumer Price Index. House prices rose 12.95 percent, while prices of other goods and services rose only 4.3 percent.
"While deceleration continues in some areas, appreciation generally is still extremely strong," said Lawler. "Mortgage rates climbed significantly during the second half of last year, but the effect of that increase on price appreciation so far appears to be limited."
OFHEO's index is based on analysis of data obtained from Fannie Mae and Freddie Mac from more than 31.2 million repeat transactions over the past 31 years. OFHEO analyzes the combined mortgage records of Fannie Mae and Freddie Mac, which form the nation's largest database of conventional, conforming mortgage transactions. The conforming loan limit for mortgages purchased in 2005 was $359,650. The limit for 2006 is $417,000
Source: Inman News and Chicago Association of Realtors
Monday, March 06, 2006
House-price appreciation continued at a robust pace at the end of 2005, with average home prices increasing 12.95 percent from the fourth quarter 2004 through the fourth quarter 2005, according to the Office of Federal Housing Enterprise Oversight.
Appreciation for the most recent quarter was 2.86 percent, or an annualized rate of 11.4 percent, according to OFHEO's figures released last week. The increase during 2005 is similar to the revised increase of 12.55 percent for the year ended with the third quarter of 2005, showing no evidence of a slowdown in average prices.
"Despite recent indications that a slowdown may be forthcoming, house-price appreciation during 2005 continued to hover at near-record levels," said OFHEO Chief Economist Patrick Lawler.
House prices continued to grow considerably faster over the past year than did prices of non-housing goods and services reflected in the Consumer Price Index. House prices rose 12.95 percent, while prices of other goods and services rose only 4.3 percent.
"While deceleration continues in some areas, appreciation generally is still extremely strong," said Lawler. "Mortgage rates climbed significantly during the second half of last year, but the effect of that increase on price appreciation so far appears to be limited."
OFHEO's index is based on analysis of data obtained from Fannie Mae and Freddie Mac from more than 31.2 million repeat transactions over the past 31 years. OFHEO analyzes the combined mortgage records of Fannie Mae and Freddie Mac, which form the nation's largest database of conventional, conforming mortgage transactions. The conforming loan limit for mortgages purchased in 2005 was $359,650. The limit for 2006 is $417,000
Source: Inman News and Chicago Association of Realtors
Monday, March 06, 2006
Wine Tasting, Wednesday March 22nd
It's official. Join me and a few of my associates for a casual wine tasting with Sommelier Amy Halloran--Wednesday, March 22nd from 7PM to 10PM. Call or email me for details... it is a private, intimate event!
ERojas@CHEmail.com
Ph. 773-510-1597
ERojas@CHEmail.com
Ph. 773-510-1597
Discount Brokers Don't Add Up (un-represented sellers too)
Awesome, awesome story. Very independent view focusing on selling your home. The author of the story tends to side opposite the full service broker at times. Not this time. Let's hear it for full service brokers (like myself)!
Sellers who skip brokers may be losing their edge
Lew Sichelman, United Feature SyndicatePublished March 5, 2006
This is "The Case of the Missing 10 Percent." It's a tale of lost millions, and it stars a cast of thousands--the thousands of owners who sell their houses without professional help.It seems that in their desire to save the 5 to 7 percent fee that agents charge for their services, FSBOs--as in for sale by owners--get 16 percent less than owners of comparable houses who put the transaction into the hands of an experienced agent, according to a survey by the National Association of Realtors.
Colby Sambrotto of ForSaleByOwner.com, an online marketplace where do-it-yourselfers list their properties and pick up valuable tips on going it alone, disputes that figure. "It just doesn't jibe with our experience," he said."We haven't put together a big study like [NAR's]," Sambrotto conceded. "But we ask all our sellers if they were successful, and 65 percent say they were. And we ask if they sold at or near their selling price, and 85 percent say they do."
But the 1.2 million-member NAR says it has the research to back up its claim. In what it calls the "largest and most authoritative" survey about how people buy and sell houses, a poll of 7,813 recent buyers and sellers through county deed records found that the median price achieved by sellers with agents was $230,000 versus $198,200 for sellers without agents.That's a difference of nearly $32,000, or 16 percent, with no significant differences between the types of homes sold.
NAR isn't alone when it says the desire to save the commission can backfire on sellers. Research by two University of Texas instructors found sellers realize little net gain when they turn to limited-service agents to perform some--but not all--the tasks needed to bring a contract to closing.The study found limited-service listings sold for 1.7 percent less than full-service listings and took 17.1 percent longer to sell. Additional research may be warranted, said James Ford, a lecturer in the College of Business at the University of Texas at San Antonio, and Ron Rutherford, a professor of finance. But for now, they say, it seems that limited-service brokerage offers "no dollar advantage."Of course, not everyone does worse in the attempt to go it alone. At the top of the market, where even fixer-uppers are selling within hours, it's tough for sellers to make a mistake.
But forget for a moment that NAR's findings might be seen as self-serving. For argument's sake, let's say the Realtors are right, that in the effort to save 6 percent--the reason cited most frequently by what NAR calls "unrepresented sellers" for selling their homes themselves--sellers lose 16 percent.The mystery here is this: If you figure that would-be buyers automatically knock 6 percent off their offers to FSBOs because they know there's at least that much fat in their asking price, where goes the remaining 10 percent?One glaring clue appears to be the inability of FSBOs to market their houses as widely or as professionally as, well, the professionals.
Nearly two-thirds of the unrepresented sellers in the Realtors' study used yard sales to alert would-be buyers that their homes were on the market. And almost half used word-of-mouth. Some also advertised in their newspapers or for-sale-by-owner magazines. A third held open houses, and a small number used direct mail.These are all good tools. But fewer than one in five listed his or her home on the Internet, either with its own Web site or on one such as ForSaleByOwner.com. Yet, the NAR study found that three of four buyers--77 percent--went house hunting on the Web. So go-it-alone house peddlers are missing a big part of the market.Virtually everyone who uses the Internet to house hunt is in the game, the survey found. They're not tire kickers; they're actively looking for properties for sale. And they want photos, detailed property information, virtual tours, interactive maps and neighborhood information before they make that first phone call or hop in the car.Internet users in the survey visited more houses than nonusers--a median of 11 versus 6, with 1 in 10 touring at least 25 properties before making a decision. And once they jumped behind the wheel, three of four went to see something that caught their attention while online.Interestingly, the sites used most frequently by home searchers are controlled by brokers. Realtor.com, NAR's official site, was visited most often, followed by the sites operated by local multiple-listing services, real-estate companies and real-estate agents.
Of course, to list a property on these sites, a seller must sign up with a broker, a full-service office at full commission or a discount firm that charges a smaller fee.FSBOs in the NAR survey also said they had more difficulty in completing the necessary paperwork, preparing their homes for the market and setting the price than they did in attracting buyers. It's hard to see how handling the paperwork affects the selling price, but staging the house so prospects see it in its best light and determining the correct asking price can have a profound effect.
Face it, many folks don't know how to make their homes show well. They fail to remove the clutter, for example, or put away all those personal items that distract visitors. Mostly, though, they cannot view their places as the commodities they become once they are on the market. To them, the house is wonderful as it is, so they don't look at it through a buyer's eyes.If there is a fatal mistake, though, it's probably that FSBOs don't price their properties correctly. Sambrotto contends they tend to price their houses too high. But too high or too low, do-it-yourselfers simply don't have the resources to determine a fair asking price.While there are a number of Internet sites--Sambrotto's is one--with valuation tools to help owners determine what their homes are worth, most agents have the best tool of all--the multiple-listing service.Agents aren't always right. Indeed, they can misread the market too. But they have a sense of the market that nonprofessionals can't match.
Sellers who skip brokers may be losing their edge
Lew Sichelman, United Feature SyndicatePublished March 5, 2006
This is "The Case of the Missing 10 Percent." It's a tale of lost millions, and it stars a cast of thousands--the thousands of owners who sell their houses without professional help.It seems that in their desire to save the 5 to 7 percent fee that agents charge for their services, FSBOs--as in for sale by owners--get 16 percent less than owners of comparable houses who put the transaction into the hands of an experienced agent, according to a survey by the National Association of Realtors.
Colby Sambrotto of ForSaleByOwner.com, an online marketplace where do-it-yourselfers list their properties and pick up valuable tips on going it alone, disputes that figure. "It just doesn't jibe with our experience," he said."We haven't put together a big study like [NAR's]," Sambrotto conceded. "But we ask all our sellers if they were successful, and 65 percent say they were. And we ask if they sold at or near their selling price, and 85 percent say they do."
But the 1.2 million-member NAR says it has the research to back up its claim. In what it calls the "largest and most authoritative" survey about how people buy and sell houses, a poll of 7,813 recent buyers and sellers through county deed records found that the median price achieved by sellers with agents was $230,000 versus $198,200 for sellers without agents.That's a difference of nearly $32,000, or 16 percent, with no significant differences between the types of homes sold.
NAR isn't alone when it says the desire to save the commission can backfire on sellers. Research by two University of Texas instructors found sellers realize little net gain when they turn to limited-service agents to perform some--but not all--the tasks needed to bring a contract to closing.The study found limited-service listings sold for 1.7 percent less than full-service listings and took 17.1 percent longer to sell. Additional research may be warranted, said James Ford, a lecturer in the College of Business at the University of Texas at San Antonio, and Ron Rutherford, a professor of finance. But for now, they say, it seems that limited-service brokerage offers "no dollar advantage."Of course, not everyone does worse in the attempt to go it alone. At the top of the market, where even fixer-uppers are selling within hours, it's tough for sellers to make a mistake.
But forget for a moment that NAR's findings might be seen as self-serving. For argument's sake, let's say the Realtors are right, that in the effort to save 6 percent--the reason cited most frequently by what NAR calls "unrepresented sellers" for selling their homes themselves--sellers lose 16 percent.The mystery here is this: If you figure that would-be buyers automatically knock 6 percent off their offers to FSBOs because they know there's at least that much fat in their asking price, where goes the remaining 10 percent?One glaring clue appears to be the inability of FSBOs to market their houses as widely or as professionally as, well, the professionals.
Nearly two-thirds of the unrepresented sellers in the Realtors' study used yard sales to alert would-be buyers that their homes were on the market. And almost half used word-of-mouth. Some also advertised in their newspapers or for-sale-by-owner magazines. A third held open houses, and a small number used direct mail.These are all good tools. But fewer than one in five listed his or her home on the Internet, either with its own Web site or on one such as ForSaleByOwner.com. Yet, the NAR study found that three of four buyers--77 percent--went house hunting on the Web. So go-it-alone house peddlers are missing a big part of the market.Virtually everyone who uses the Internet to house hunt is in the game, the survey found. They're not tire kickers; they're actively looking for properties for sale. And they want photos, detailed property information, virtual tours, interactive maps and neighborhood information before they make that first phone call or hop in the car.Internet users in the survey visited more houses than nonusers--a median of 11 versus 6, with 1 in 10 touring at least 25 properties before making a decision. And once they jumped behind the wheel, three of four went to see something that caught their attention while online.Interestingly, the sites used most frequently by home searchers are controlled by brokers. Realtor.com, NAR's official site, was visited most often, followed by the sites operated by local multiple-listing services, real-estate companies and real-estate agents.
Of course, to list a property on these sites, a seller must sign up with a broker, a full-service office at full commission or a discount firm that charges a smaller fee.FSBOs in the NAR survey also said they had more difficulty in completing the necessary paperwork, preparing their homes for the market and setting the price than they did in attracting buyers. It's hard to see how handling the paperwork affects the selling price, but staging the house so prospects see it in its best light and determining the correct asking price can have a profound effect.
Face it, many folks don't know how to make their homes show well. They fail to remove the clutter, for example, or put away all those personal items that distract visitors. Mostly, though, they cannot view their places as the commodities they become once they are on the market. To them, the house is wonderful as it is, so they don't look at it through a buyer's eyes.If there is a fatal mistake, though, it's probably that FSBOs don't price their properties correctly. Sambrotto contends they tend to price their houses too high. But too high or too low, do-it-yourselfers simply don't have the resources to determine a fair asking price.While there are a number of Internet sites--Sambrotto's is one--with valuation tools to help owners determine what their homes are worth, most agents have the best tool of all--the multiple-listing service.Agents aren't always right. Indeed, they can misread the market too. But they have a sense of the market that nonprofessionals can't match.
Wednesday, March 01, 2006
EXTRA EXTRA, get your "off market properties"!
Just about every client I work with sends me properties they found on some web site here or there. I think it's great they are engaged in the house hunt. And sometimes, the client will find their perfect place surfing the internet or looking in the paper. That is, the house or condo is still on the market and we eventually write a contratc to purchase the home.
This is the most positive way to work together. While I'm looking, my client is looking, and the right place will come along. However, many times a client gets their hopes up about the perfect home they found on a website and they wonder how I missed it. And, I've run searches in that exact area every day.
The truth is, much of the property information on random web sites and in the newspaper is outdated or lags behind "real time". The properties found by clients are many times sold or have been under contract. Many lack major features important to the client, but this data is missing from the information they saw.
Beyond market knowlege, negotiating skills, scheduling and transaction management, a Realtor's value is in the immense time spent on researching properties that are right for the client. I spend a crazy amount of time, for example, searching for a two bedroom condo with the type of outdoor space and price point that will satisfy my particular client's needs. There are literally hundreds of condos out there that sound good from some ad, but will not fit the bill when it comes to the client's values. A good Realtor will know this and only choose the best for your showings.
Anyone can look at newspaper ads or search properties on the Internet. In fact the Internet is supposed to eliminate the need of real esate agents completely. The above process however is much more time cosuming and much more inaccurate than most can imagine. For example, when searching properties totally on your own, and without professional resources, there is a time lapse that may let the perfect home slip away. The Sunday paper ad could be for a home that sold Wednesday during the week! I'm able to quickly research a property to determine it's status with real time data and just as quickly identify a similar property that just hit the market.
BUT WHAT ABOUT "OFF MARKET" PROPERTIES?
I'm not only searching the thousands of "on market" properties available at my finger tips through advanced research and professional data, but I'm also searching "off market" properties as well.
Off market properties can be discovered from inside information I have about a property a seller may list in the coming weeks. Even better, and cooler for the really good Realtors, off market properties can be had even when the owner doesn't know they're property has a buyer!
For example, I met some folks at an open house. The guys signed in with their home address and took a look around at the gorgeous single family home my brokergae is listing. I hardly spoke to them due to the busy nature of the open house that day. After the open house, I drove by the address on the card the guys filled out and found that the place was a very well kept, small, single family home. That same day I met a couple who is trying to sell their townhome in order to move up into a small single family home. Do you see where I'm going with this?
With a couple phone calls, I had arranged for the townhome sellers to view the home of the guys, even though they did not have it on the market! The guys were flattered. They were only thinking of putting their house on the market to find a bigger place, but were afraid to go through the home sale process. By finding them a buyer for their "off market" property, I eliminated the most stressful part of selling a home---opening it up to the world and wondering what will happen! Plus, the townhome couple had first crack at a great place they really liked; without competition.
So, before you go it alone, give me a call and find out how much it helps to have the research and representation on both the buying side and the selling side.
This is the most positive way to work together. While I'm looking, my client is looking, and the right place will come along. However, many times a client gets their hopes up about the perfect home they found on a website and they wonder how I missed it. And, I've run searches in that exact area every day.
The truth is, much of the property information on random web sites and in the newspaper is outdated or lags behind "real time". The properties found by clients are many times sold or have been under contract. Many lack major features important to the client, but this data is missing from the information they saw.
Beyond market knowlege, negotiating skills, scheduling and transaction management, a Realtor's value is in the immense time spent on researching properties that are right for the client. I spend a crazy amount of time, for example, searching for a two bedroom condo with the type of outdoor space and price point that will satisfy my particular client's needs. There are literally hundreds of condos out there that sound good from some ad, but will not fit the bill when it comes to the client's values. A good Realtor will know this and only choose the best for your showings.
Anyone can look at newspaper ads or search properties on the Internet. In fact the Internet is supposed to eliminate the need of real esate agents completely. The above process however is much more time cosuming and much more inaccurate than most can imagine. For example, when searching properties totally on your own, and without professional resources, there is a time lapse that may let the perfect home slip away. The Sunday paper ad could be for a home that sold Wednesday during the week! I'm able to quickly research a property to determine it's status with real time data and just as quickly identify a similar property that just hit the market.
BUT WHAT ABOUT "OFF MARKET" PROPERTIES?
I'm not only searching the thousands of "on market" properties available at my finger tips through advanced research and professional data, but I'm also searching "off market" properties as well.
Off market properties can be discovered from inside information I have about a property a seller may list in the coming weeks. Even better, and cooler for the really good Realtors, off market properties can be had even when the owner doesn't know they're property has a buyer!
For example, I met some folks at an open house. The guys signed in with their home address and took a look around at the gorgeous single family home my brokergae is listing. I hardly spoke to them due to the busy nature of the open house that day. After the open house, I drove by the address on the card the guys filled out and found that the place was a very well kept, small, single family home. That same day I met a couple who is trying to sell their townhome in order to move up into a small single family home. Do you see where I'm going with this?
With a couple phone calls, I had arranged for the townhome sellers to view the home of the guys, even though they did not have it on the market! The guys were flattered. They were only thinking of putting their house on the market to find a bigger place, but were afraid to go through the home sale process. By finding them a buyer for their "off market" property, I eliminated the most stressful part of selling a home---opening it up to the world and wondering what will happen! Plus, the townhome couple had first crack at a great place they really liked; without competition.
So, before you go it alone, give me a call and find out how much it helps to have the research and representation on both the buying side and the selling side.
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