Archive for January, 2009
BANK OWNED HOMES–ARE THEY A “GOOD DEAL?”
January 29th, 2009 categories: Market Trends
There are some foreclosed, bank owned, short sale properties in Chicago. Many buyers think that they are the bargain of the century–this is not necessarily true. And the hassles can be frustrating and fruitless. Here are a few things to be aware of if you are thinking of pursuing a bank owned property.
- The lender has to approve a short sale. Your contract will be submitted to the lender who is taking the loss.
- The lender can take an interminable amount of time to respond. It would seem reasonable that the lender would want to sell and be rid of the property ASAP. Not true.
- This lengthy response time makes it impossible for the buyer to know a specific move-in date. A bank owned property probably works best for an investor who is not going to live in it or a first-time buyer with an understanding landlord.
- Your locked in-interest rate may vanish and you may have to pay more because of the lender’s lengthy approval time.
Fortunately, distressed properties are not the only way to get a “good deal.” Many sellers are understanding the realities of today’s market and are pricing their properties so that they are priced to sell. By purchasing a new home in the more conventional way, you are able to keep your locked-in interest rate, close and move into your new home on a definite schedule.
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SOME REAL ESTATE GOOD NEWS–HOORAY!
January 28th, 2009 categories: Market Trends
It may be time for our little leprechaun to do a joyous jig! Finally–some JUBILATION IN THE REAL ESTATE MARKET! A recent article suggests that we might have seen the first two signs that the market is coming back. To read the article, click here. Everyone has said that the return of the housing market to something approaching normal will be a key to economic recovery. That is undoubtedly true. Just think about it–whenever someone moves they make at least one trip to the hardware store–paint, light bulbs, a faucet, a shower head–whatever. Those purchases spread throughout the economy helping retailers, distributors and manufacturing plants. Even though prices are down that very fact may bring in more buyers and sellers–let’s hope so! A recent Forbes article also had some good news. In an article titled Economic Slow Pace Can’t Continue the authors write about the replacement rate for existing homes–at the current pace it would take 236 years to replace all the homes in the country. The normal rate is 75 years. These two articles, plus the fact that Chicago real estate prices only declined a bit over 10 per cent versus the national average of about 20 per cent gives me great hope that this year will be a big improvement on 2008. What a wonderful thing to be able to bring you some good real estate news!
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CLOSETS, CLOSETS, CLOSETS
January 27th, 2009 categories: Lifestyle, Rants
There are never enough and never too many. Organizing your closet can be inexpensive or over the moon in cost. Probably the first order of business is to clean out and throw out all the clothes you haven’t worn in a year. Closets are sort of like hardwood floors and granite countertops–they have worked their way down the amenity chain until now they are an expected amenity.
- Wire is probably the least costly way to organize your closet–all the big box stores have it and there are drawers that can be fit into the systems. This type of organizer can frequently be installed by the homeowner.
- Melamine is popular–it is sort of like a kitchen counter top in appearance. It is available in white and colors. A skilled do-it-your-selfer could probably do the job.
- Veneer is the next step up in price. The cabinets and drawers usually have composite wood insides but veneer fronts. This kind of cabinet can be stained to match your floors. Probably best professionally installed.
- Solid wood is of course the most expensive–this kind of cabinet is just like a custom made kitchen cabinet. Also probably best done by a professional.
- Accessories can make the heart of the most compulsive neat freak happy–shoe cupboards, tie and belt racks, baskets, divided drawers for lingerie, locked drawers for jewelry, hampers, fold-down ironing boards.
If you are really, really serious about getting your closet act together–hire a professional closet organizer. A professional can help you understand your needs and clothes storage habits and take your foibles into account–all the little personal things that you don’t think about. And do remember–an organized closet will definitely help make your home more attractive when you decide to sell it.
Related Articles: Clean Your Closets–A Great New Year’s Resolution!, 1-09
Need to talk to a real estate professional about finding a home with lots more closets–call me at 312-981-2360.
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CLEAN OUT YOUR MEDICINE CABINET TOO!
January 26th, 2009 categories: Selling
One of the last places most of us think about cleaning out is our medicine cabinet. They are frequently full of old half-used cosmetics, tooth paste, after shave, out of date prescriptions and out of date over the counter potions for one ailment or another. A good idea for spring cleaning is to dispose of all the old junk. It could be disastrous if you got up in the middle of the night sort of half sick and reached for the pill bottle from your last bout with the flu–a way out of date antibiotic. Drugs should be taken to a hazardous material disposal site–the City of Chicago advertises locations several times a year and so do most suburbs. Play it safe and play it clean–an uncluttered medicine cabinet is a good thing to have at any time but especially if you are in the process of selling your home. Buyers want everything to be fresh and clean and they DO open cupboards and drawers and doors!
Want to find out what’s going on in Chicago real estate–give me a call at 312-981-2360.
Related Articles: Clean Your Closets–A Great New Year’s Resolution, 1-09, Proper Packaging for your Home Sale, 1-09.
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KID GLOVES NOT MITTENS FOR TODAY’S BUYER
January 23rd, 2009 categories: Market Trends, Selling
Because loan requirements are so much more stringent than they were a short time ago, buyers are fewer and farther apart. When you, as a seller, have a qualified buyer who has made a good faith offer on your home, don’t let the deal fall apart over relatively insignificant details. Be patient and consider carefully all of the aspects of the transaction. Keep your cool even when a low ball offer comes in–keep the channels of negotiation open. Here are a few ideas that can help the seller glue the transaction together for good.
- Price is always most important–beware of pricing that is based on your needs. Buyers don’t care what you “need.” And they will probably not even visit a property they feel is overpriced even a little bit. My experience is that today’s buyers are only interested in properties that are priced at or below market value.
- A few years ago, in the good old seller’s market days, sellers didn’t have to be so careful. It is best to respond to all offers as quickly as possible, certainly within 24 hours–and consider your counter offer carefully. Can you possibly accept the price the buyer offered?
- Timing is also important–do your dead level best to accommodate whatever closing date the buyer needs. If it is a delayed closing or a darn near immediate closing–try to meet the buyer’s request.
- If your grandmother’s chandelier is going to be an exclusion, think about replacing it before you put your home on the market. I have had deals fall apart because the seller was so in love with an inexpensive item that they would absolutely not leave it behind.
- Inspection reports are another reason sales fall apart. If the request is relatively minor–say a new shower head or a new disposal, honor it. Either give a credit at closing or have the work done. If the cost of the work is major–like replacing a heating or cooling system–have your listing agent carefully and diplomatically requests getting a second opinion from another inspector that you hire.
Well-qualified buyers aren’t quite as scarce as hen’s teeth but they are scarce enough today that we need to coddle them a bit.
If you have any other questions about selling your home, please call me at 312-981-2360.
Related Articles: Proper Packaging For Your Home Sale, 12-08, How To Get The Buyer And Seller Together on Price, 12-08
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COMPACT FLUORESCENT LIGHT BULBS 101
January 22nd, 2009 categories: Lifestyle, Market Trends
The compact fluorescent light bulb, hereafter known as CFL, is new and I was amazed to learn that there are lots and lots of types of CFLs. They can save us money on our electric bills so we should all probably know a bit more about them than we do. Undoubtedly there will be more types and shapes of CFL bulbs coming on the market in the near future. Here are four of the types currently available.
- The twin tube bulb has two parallel tubes and it us used for lamps, task lights, ceiling lights and wall lights.
- A quad tube bulb gives nearly the same light output as a twin tube of the same wattage and it is only half as long as the twin tube equivalent. Usually this bulb is used in smaller lamps and similar applications.
- A triple biax tube gives even more light in a short bulb. They provide a lot of light from a bulb that uses a very small amount of space. They are a good fit for use in a table lamp.
- The spiral bulb is a spiral shape in a continuous tube. This is the most popular CFL because it is the mos similar in shape and light to a standard incandescent bulb.
Related Article: Energy Drains–Let’s Get Rid Of Them, 1-09
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ABSORPTION RATE–WHAT IS IT?
January 21st, 2009 categories: Market Trends
Are you thinking of buying or selling a home soon? Looking at the absorption rate is a good thing to do–it will keep you informed about exactly what is going on in real estate in a specific area.
What is an absorption rate? It is a mathematical equation that tells the amount of time it will take for a specific amount of properties to be absorbed under current real estate conditions. The parameters are both geographic and price point. A buyer’s market will have a higher number–an absorption rate of six or more months is considered a buyer’s market. Three to five months is considered a normal market and under three months is a seller’s market. It has been a couple of year since we have had a true seller’s market in Chicago!
If you would like me to figure an absorption rate for you, please call me at 312-981-2360.
Related Articles: First Time Buyer Down Payments, 1-09, Buy Now First Timers, 1-09, Do What To Sell My Home?, 1-09, Proper Packaging For Your Home, 12-09
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FIRST TIME BUYER DOWN PAYMENTS
January 20th, 2009 categories: Market Trends
After ranting and raving about how first time buyers should buy NOW. it occurred to me that the first thing needed is a down payment. So, as usual, I have some suggestions for you–I DO love to tell people what to do!
- Figure out what are your absolute necessity purchases and what is discretionary–do you really, really have to have that latte every morning? A good thing to do is write down your expenditures, every penny, for a month.
- Think about a part time job and save what you earn from that job until you have your down payment.
- Do you have anything to sell? Ebay or Craig’s List might yield a few pennies.
- Is there a relative–parent, grandparent, aunt, uncle–who could help you. A co-signer can sometimes improve your borrowing profile.
Thanks for listening! I would be happy to talk with you about a plan–312-981-2360.
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BUY NOW FIRST TIMERS!
January 16th, 2009 categories: Buying
Will we look in the mirror in a few years and say to ourselves “Why didn’t I buy THEN, 2009?” The financial crisis will end and housing prices will go up again. I don’t know if the housing price decline has ended–we only know bottom when prices start to go up again. I do know that financially savvy young people who have been saving for a home will kick themselves if they continue to hoard their down payment money and miss the opportunity that may be the opportunity of a lifetime–if they can qualify for a mortgage. Just think about it–rates are low, inventory is high–no current home to sell–when is it going to get any better?
If you would like to discuss buying a home, please call me at 312-981-2360.
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DO WHAT TO SELL MY HOME?
January 15th, 2009 categories: Market Trends
Our Chicago home selling market is much, much better than most of the country’s home selling market. All kinds of wild and wacky sales incentives are being offered. One San Diego home builder offered a free $400,000 home if a buyer purchased a $1,000,000 home–they didn’t have to make good on the less expensive home and they DID sell all of their expensive homes. Some people have resorted to raffling their homes. With the fear of unemployment and actual unemployment, some developers have offered to guarantee a job that would make it possible for the buyer to afford the home. Some sellers are giving away cars and vacations. We are blessed indeed that we are not that desperate in Chicago! There are some more conservative suggestions you can think about that might help you sell your home.
- Offer a three or four percent cooperating commission to the buyer’s agent. There is a spot on the buyer’s agent print out that shows the cooperating commission–let me ask you–with most other things being equal, would you show a home with a 2.5 per cent commission if you could show a home with a 3 per cent or 4 per cent commission? Almost all Realtors are closing fewer homes now and so a bigger pay check for one sale can be very important. Some East Coast developers are paying the agent 1 per cent at contract signing and 3 per cent more at closing.
- Help pay closing costs–offer $1,000 or more to help the buyer with closing costs.
- Offer owner financing if you can and are comfortable with the idea.
- PRICE–re-examine your price with your agent. Price is the key ingredient in getting a home sold. With financing requirements so much more stringent, a qualified, pre-approved buyer has many homes to choose from and will choose the home that offers the most bang for the buck.
Hopefully these suggestions will help you–if you would like to discuss your specific siguation, please call me at 312-981-2360.
Related Articles: Proper Packaging For Your Home Sale, 12-08, Chicago Real Estate Values Down Only 10 Per Cent, 1-09,
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