Tag Archives: atlanta

SOME MUSINGS ON LOWER PRICE RANGES AND NEIGHBORHOODS

23 Wednesday Dec 2015

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NeighborhoodA reporter working on a story recently contacted me and wanted me to give my opinion on the “BEST” neighborhoods for a given type of buyer in a given price range.  Unfortunately, I can’t know that without knowing the buyer.  Not only WHO you are (first time homebuyer, young family, aging empty nester), but also your personality.  Your personal traits and also your architectural personality.  Do you like historic bungalows, sleek modern houses, or traditional homes with gorgeous molding and impeccable finishes?  With any personality and price range, there are numerous neighborhoods which might fit the bill.  What you need is the Realtor who will get to know YOU and help you find the right house in the right neighborhood at the right price.  I’m going to share with you some insights I recently gave to a writer for Atlanta magazine who asked me to GENERALIZE on the best neighborhoods for a given demographic in a given price range… but keep in mind that it ALL DEPENDS ON THE BUYER.
SOME RECOMMENDED NEIGHBORHOODS for price points/demographics:

I’ll start with another disclaimer: SO MUCH depends upon where the buyer and family members WORK.  Traffic in Atlanta just gets worse and worse – and commute time is precious time away from the family.  So NO neighborhood is a good neighborhood for you if your commute time is more than an hour, I’d say!  And we have good neighborhoods all around – so I usually start by asking the homebuyer, WHERE DO YOU WORK?  And then WHERE DO YOU LIKE TO PLAY/where are your friends?  And gauge the “right” neighborhood accordingly.  Another important factor is the homebuyers’ PERSONALITY.  One may HAVE to live in a walkable neighborhood while another would prefer a newer swim/tennis community. But I will do my best giving you in a general sense some of the best neighborhoods that I think exist for each price range….

Young family
1.  Under 200k: For a young family under $200,000, believe it or not there are several very good options not too far out!  I love Doraville/Chamblee.  Montgomery Elementary School is a favorite.  If they don’t mind living farther out and commute is not an issue, $200,000 will buy you a nice home in far East Cobb.  I usually recommend that the family VISIT the school personally where their child will go.  Some schools that don’t have great scores “on paper” are well loved by some of their constituents, and if there’s an IB (international baccalaureate program), a gifted child can have a great experience even at a not as great school.
2.  200-350k: Closer in East Cobb for the schools.  While the Sope Creek district is outside the range, there are a number of other great schools just a little farther out with houses in this price range.
3.  350-500k: Oakhurst, fun, diverse, walkable, family friendly.  There are also great options in Ashford Park/Drew Valley/Brookhaven Heights.   These are neighborhoods across Peachtree to the east of Historic Brookhaven.  Ashford Park Elementary is well thought of and it’s a very central location, close to I-85 and to 400.  Dunwoody is always a favorite – close in, family friendly.
4.  500k+: I can’t say enough about Decatur, as long as your work commute isn’t terrible from there.  Everyone loves City of Decatur schools, the walkability and the city services.   A lot here depends on the personality of the family!  Inman Park history might be perfect for some (with great Mary Lin Elementary), Druid Hills serenity and history (Fernbank Elementary), or for the rising corporate executive perhaps Buckhead (although homes in 30327 are generally a young family’s “second” home).

20 something
1.  Under 200k: A 20 something could go for a small condo just about anywhere they want to be.  There are even cool places in this range in the heart of Virginia Highland, in Midtown, and in Buckhead.  But if investment is also a consideration, I’d go for Doraville/Chamblee area.  With The Assembly (mixed use) development going in where the old GM Plant was, there’s a whole lot happening in this part of town.  Another great place for investment would be the historic West End – anywhere near where the Beltline WILL be going in the coming years.  There’s some awesome housing stock – great historic bungalows! And soon enough this will be the new “hip” area of town.
2.  200-350k: Ormewood Park, Reynoldstown, Kirkwood – these are the cool areas of town near the Beltline that are still affordable.  I also like SMYRNA near the Smyrna Market Village.  With the Braves Stadium moving to Cobb County, Smyrna is far enough away to avoid traffic (and you’re able to get south without getting on I-75 from there) but close enough to benefit from the development.
3.  350-500k: If they are the Buckhead type, a cool sleek condo walkable to Buckhead action!
4.  500k+: Virginia Highland, Old Fourth Ward, Inman Park, anywhere near the Beltline!

Empty nester
1.  Under 200k: On the north end of town, Kennesaw is a good option and Kennesaw Mountain is a great place to hike and to take the grandkids.  On the east side of town, Stone Mountain has some great solid one level ranch housing that might also be perfect.
2.  200-350k: In this range, a good option might be a one level ranch close to where the kids live (if the kids are in Atlanta) or close to the neighborhood they are downsizing from (to stay in touch with friends).  Lots of great neighborhoods in Tucker and nearby; Tucker has a great small town feel but is so close in, and very warm and welcoming.
3.  350-500k: I find many empty nesters in this price range love the ACTIVE ADULT communities a little farther out of town.  These generally are designed in a 4-pod pattern; basically 4 houses joined together, each all one level with a garage.  There’s a central clubhouse and pool and the exterior maintenance is generally covered by the homeowners association.  Jim Chapman is one of the prominent builders of these communities.  They are generally pretty far outside the Perimeter – there’s one near Serenbe and several which are past Alpharetta.
4.  500k+: The place historically we see empty nesters in this price category purchase is in VININGS, because taxes in Cobb County are much lower for senior citizens (the county takes off the “school” portion of the tax).  Many empty nesters end up in one of the beautiful highrises like One Vinings Mountain and The Aberdeen or buy a Weiland townhome at Paces View with an elevator.  An added bonus is that those properties are within walking distance to the Vinings Jubilee and to many awesome restaurants.

Mary Anne Walser is a licensed attorney and full-time REALTOR, serving buyers and sellers in all areas of Metro Atlanta. Her knowledge of residential real estate and her legal expertise allow her to offer great value to her clients. Mary Anne serves on the Committee that drafts and reviews the contracts utilized by all REALTORS in the State of Georgia. In addition, she is a member of the Atlanta Board of Realtors, the Georgia Association of Realtors, the State Bar of Georgia and the Georgia Association of Women Lawyers. Contact Mary Anne at 404-277-3527, or via email: maryannesellshomes@gmail.com.

 

THE WEATHER TURNS COOL, BUT THESE ATLANTA NEIGHBORHOODS ARE HOT!

28 Wednesday Oct 2015

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Hot NeighborhoodsAtlanta has SO many great neighborhoods!  But here’s a quick take on what are some of our hottest (of the moment) neighborhoods and those that are HOT VALUE neighborhoods NOW, this Fall, 2015, in Atlanta.  Note the distinction.  When a neighborhood is “HOT” – i.e., very popular at the moment, oftentimes prices will rise rapidly as buyers bid against each other in their rush to move in.  A HOT VALUE neighborhood is one that is not yet “RED HOT” but which WILL be hot in the coming years, and so there are still bargains to be had.  Now, if you’re bidding in a HOT neighborhood and prices are rising, there is no need to fear overpaying as long as it’s a neighborhood that is likely to hold or increase in value in the coming years.  Usually a neighborhood is HOT either because of location, schools, or both; the location isn’t going to change and if the schools are good, residents always fight to KEEP them that way.

Don’t be concerned that I am leaving out your favorite HOT neighborhood – know that I’m not addressing CLASSICALLY HOT neighborhoods… I’m not addressing them in this particular blog post because they are always hot.  This would include Decatur zip 30030, Midtown, Va/Hi, Morningside, and many northern suburbs such as Alpharetta, Roswell, Johns Creek, and East Cobb in its great school districts.

And also know that there’s no way to address all the “hot” areas in one blog post – I’ll just touch on a few to whet your appetite, and I’ll cover different areas of town.

Let’s start in Ashford Park, just east of Peachtree Road – Ashford Park is HOT.  The elementary school is awesome and there’s lots of new construction.  While several years ago one could get a pretty decent home for $300,000 here, I just sold a teardown LOT for $500,000 with multiple offers in one day.

HOT VALUE near there is CHAMBLEE.  While Montgomery Elementary is not yet par with Ashford Park, it’s getting there, and the City of Chamblee is making great strides in developing retail areas.  THE ASSEMBLY huge mixed use development is going in where the old GM Plant used to be and that’s exciting.  Because it’s up and coming, there are still values to be had.

NOW, let’s go to the Beltline, which is of course driving values everywhere it touches.  We’ll start with Old Fourth Ward, O4W in local parlance, and its neighbors, Inman Park and Poncey Highland.  HOT because of the Beltline (and that’s a continuing theme – the Beltline has made many Atlanta neighborhoods “HOT” so it is important to know where the Beltline IS, where it will be, and where it’s going…. ).  Quick aside = the Beltline is a 22 mile bike/walk/run path being built in a huge Atlanta circle.  Only parts of it are complete, other parts are underway, and some sections may be years in the making. But the O4W portion is complete and with it O4W Park, Ponce City Market, Krog Street Market – the list of “cool” things that have come with it are legion.

HOT VALUE is south of there, in Reynoldstown, Edgewood, and East Atlanta.  There’s also Ormewood Park, nestled between Grant Park and E Atlanta on the Southside (Grant Park has been and continues to be a “hot” area).  The beltline goes right through this great neighborhood of old bungalows and great diversity.  There is section 8 housing a block from $700,000 homes.  There are still a lot of values to be had – I just sold a $250,000 adorable house one block from the Beltline.  The Beltline here is not yet finished, so prices haven’t risen SO high SO fast.

For more hot values, seek out Capitol View Manor, Mechanicsville, and Adair Park – neighborhoods to the west of the afore-mentioned neighborhoods.  These are nestled in west of I-75/85 and south of I-20, and the Beltline goes right beside and through them.

Let’s leave the Beltline for a minute and head down towards to the Airport to stop at The Manchester Arms in College Park for a meal.  Marvel at what College Park is becoming.  Because Woodward Academy is down there, some northern suburb dwellers have built weekday homes for one spouse and the kids to live in before they go back to the northern burbs for the weekend.  PORSCHE moving into the airport has meant even more wealth moving into the area.  College Park is hot; East Point just to the north of it is still a hot value neighborhood.

Back on the Beltline and moving North; HOT is BRANDON SCHOOL DISTRICT = you’ll pay a premium for great public schools in Atlanta, and Brandon is a good indicator of that.  One of my favorite neighborhoods is CHANNING VALLEY, where prices have risen 22% over PRE recession prices; it’s a small friendly diverse neighborhood in a great convenient spot.

HOT VALUE is West Midtown = Howell Station is an example.  It’s near BELLWOOD QUARRY, which saw thousands of zombies in the season premiere of Walking Dead.  Now that the zombies are gone, that park will be the crown jewel of the Beltline.  Because that area is still very industrial and the Atlanta Jail is nearby, prices are still low, but demand is rising.

And finally, up North to just outside the Perimeter.  Smyrna west of 285, just outside Vinings, the area nicknamed “Smynings” is hot but there are also still a lot of value priced properties.  With the new Braves Stadium going in, it’s becoming even more desirable as a place that will be close to the action and the new development; and yet far enough west that residents can still get places without running too much into Braves traffic.

Again, these are just a FEW of the “hot” areas that I am seeing.  Please email me YOUR favorites so that I can feature them in a future blogpost!

 Mary Anne Walser is a licensed attorney and full-time REALTOR, serving buyers and sellers in all areas of Metro Atlanta. Her knowledge of residential real estate and her legal expertise allow her to offer great value to her clients. Mary Anne serves on the Committee that drafts and reviews the contracts utilized by all REALTORS in the State of Georgia. In addition, she is a member of the Atlanta Board of Realtors, the Georgia Association of Realtors, the State Bar of Georgia and the Georgia Association of Women Lawyers. Contact Mary Anne at 404-277-3527, or via email: maryannesellshomes@gmail.com.

No Need to Cork the Bubbly – Let’s Celebrate the Recovery

16 Friday Oct 2015

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champagne-300x300

After the dismal housing recession in Atlanta (and everywhere) that hit in 2008 and sent housing prices on a sharp decline,  prices finally started to stabilize in late 2014 and have risen ever since.  Having just emerged from the doldrums to a rapid rise in pricing, some experts are declaring a new “housing bubble”; but reports of the imminent death of the rising residential market are greatly exaggerated.

In Atlanta, we took longer to sink during the recession and have been slower to rise in the recovery.  Right now we have a shortage of inventory but our prices still are not rising as quickly as they are in many cities.  This measured response to the national trends bodes well for us; as does the fact that so many companies are bringing headquarters and employees to Atlanta.  We have more buyers moving here, which will naturally put upward pressure on pricing, but which will serve to continue to support that pricing in the coming years as they continue to live and work in Atlanta.

In addition, as more sellers receive the news that housing prices are rising and that they ARE able to sell and make a profit, more are putting their homes on the market.  This additional inventory is helping to reduce the number of competitive bid situations and to stabilize the rapid rise in pricing.

Further, it was a very loose mortgage lending environment that contributed to the original housing bubble.  It was far too easy to get a mortgage at that time.   That loose mortgage environment ground to a screeching halt in 2009 and it is still difficult today to secure a mortgage.  The strict underwriting guidelines that were implemented following the “mortgage meltdown” are still in place, meaning that the torrent of unqualified buyers that precipitated the initial crisis are nowhere to be found and are, hopefully, never to return.  Banks are lending only to qualified buyers with good credit scores who are less likely to default on their mortgage loans.  Interest rates are still low right now, but are likely to rise, which will create yet another governor on the ability of buyers to purchase and the ability of sellers to ask ever increasing prices.

After fifteen years in the business, I have seen a lot of ups and downs in the housing market.  This particular recovery, while fast, has not spun out of control and is unlikely to do so.   While it’s always prudent for a buyer to carefully review the sales of comparable properties and to research the  neighborhood and factors contributing to that neighborhood’s potential before agreeing on price, and although that price is going to be higher than it was three to five years ago, there’s no need to panic or to cork the bubbly over a housing “bubble”.  Rather, we should continue to celebrate the housing recovery.

Mary Anne Walser is a licensed attorney and full-time REALTOR, serving buyers and sellers in all areas of Metro Atlanta. Her knowledge of residential real estate and her legal expertise allow her to offer great value to her clients. Mary Anne serves on the Committee that drafts and reviews the contracts utilized by all REALTORS in the State of Georgia. In addition, she is a member of the Atlanta Board of Realtors, the Georgia Association of Realtors, the State Bar of Georgia and the Georgia Association of Women Lawyers. Contact Mary Anne at 404-277-3527, or via email: maryannesellshomes@gmail.com.

Chicken Little Goes to Closing

06 Thursday Aug 2015

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HUD

The sky is falling! To hear lenders and closing attorneys tell it, the world as we know it comes to an end on October 3rd. That’s the day new regulations come into effect that govern the mortgage lending and closing process. Whether or not there’s mass bedlam, there are certainly changes that buyers and sellers of property should be aware of and prepared for, so this article will summarize them.

To understand how things are changing, it is important to know how the world works now. Today, sometimes the loan and closing statement will change the day of closing or even while parties are sitting at the closing table. Starting in October, that cannot and will not be possible anymore, at least as to every mortgage application received October 3, 2015 or later. The new rules require that a new document, the Loan Estimate, must be provided to the borrower within three days after loan application, and another new document, the Closing Disclosure, must be provided to the borrower at least three business days prior to closing. These apply to any mortgage loans with no exceptions. If there are changes to the deal, a new disclosure must be provided and the three-day waiting period starts all over. While previously the settlement statement was provided by the closing attorney and often at the last minute, with the new regulations the lenders themselves will likely be providing the statement directly to the borrower and they must confirm and document receipt by the consumer.

You can see how this can potentially cause big problems. “Stacked closings” are common now, in which the seller of one property uses those proceeds to purchase a new property in the next hour from a seller who may the following hour be buying a new property of their own. These back-to-back closings dependent upon one another for consummation are already tenuous at times. Imagine what the new three-day waiting requirement may do! So in practical effect and application, we Realtors must advise our clients of the following:

  • Delays are much more likely, particularly in the early days of implementation of the new regulations.
  • A seller will want to negotiate possession some number of days AFTER closing. While this has always been the case for a seller still living in the property they are selling, now it becomes even more crucial.
  • A buyer will want to commit to a lender as soon as possible in order to attempt to limit any delays. A buyer will want to be sure they choose a lender fully conversant with the new regulations and a lender who has a system in place to comply.
  • While some lenders can get a loan through underwriting and closed quickly, every loan is going to take longer with these new requirements, particularly at first. A cushion of 45 days between contract and close is advisable.
  • From a Realtor’s standpoint, any and all provisions of the contract should be tied up as early as possible. In particular, if there are monetary concessions during the due diligence period, those should be provided to the lender as soon and as early as possible. Even changes in the Realtor’s commission are part of the disclosure process and should be wrapped up as early in the process as possible.
  • While lenders are the primary front line, closing attorneys must also be in line with the new regulations. It is advisable to look for a closing attorney who does residential real estate closings regularly, has systems in place, and preferably is ALTA (American Land Title Association) best practices certified.

The new disclosures are designed to help consumers better understand the terms and costs of their mortgage loan; however, in one aspect the new disclosures are more confusing. The new rule prohibits lenders from disclosing a reduction that is commonly offered by the title insurance companies when a lender’s title policy and the borrower’s title policy are issued at the same time. Instead, there’s one lump sum disclosed; at closing the cost will actually be *less*. While that might result in a pleasant surprise for some at closing, those borrowers who are watching closely will likely be more confused about what, exactly, the title insurance is actually going to cost them at closing.

The home sale and purchase process can be confusing enough. If you are planning to make a move this year, be sure you plan for these new regulations and have trusted advisors guiding you through the process.

Mary Anne Walser is a licensed attorney and full-time REALTOR, serving buyers and sellers in all areas of Metro Atlanta. Her knowledge of residential real estate and her legal expertise allow her to offer great value to her clients. Mary Anne serves on the Committee that drafts and reviews the contracts utilized by all REALTORS in the State of Georgia. In addition, she is a member of the Atlanta Board of Realtors, the Georgia Association of Realtors, the State Bar of Georgia and the Georgia Association of Women Lawyers. Contact Mary Anne at 404-277-3527, or via email: maryannesellshomes@gmail.com.

TAX BREAKS FOR HOMEOWNERS

31 Friday Jan 2014

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Congratulations, homeowner!  In addition to the pride of owning your own property, there are many subsidiary benefits, including TAX benefits.  With April 15th fast approaching, let’s take a look at some of these.  You want to be sure that you don’t miss any of them if they apply to you.

One huge benefit is the mortgage interest deduction.  Basically, the interest you pay on your mortgage is fully deductible from your taxes.  In the first years of your mortgage, most of what you are paying is interest, so this benefit can be huge!  Your mortgage company will send you a statement showing the exact amount you paid in nterest in 2013, and you can use this information to save a bundle on your taxes.

And, if you purchased your home this year, your closing costs may also be tax deductible – even if all or a portion of them were paid by the seller.  As with all of these deductions, be sure to consult your tax professional about the proper way to claim the benefit and the appropriate amount.

Here are some smaller, but still significant tax savings that are good for your 2013 taxes but which may *not* be available in 2014 (unless Congress decides to extend them), so be sure to take advantage of them this tax season if at all possible.

  • Energy-Efficiency Upgrades.  This is a tax credit, which reduces what you owe dollar for dollar. The types of upgrades that meet the criteria include new exterior windows, insulation, exterior doors, and roofing.  The tax credit is capped at $500 (less in some cases), but you’re likely to save even more in the long run – by having lower utility bills. 
  • Debt Forgiveness.  If you sold your home in a short sale or foreclosure last year, your lender likely forgave at least a portion of your mortgage debt.  The Mortgage Debt Forgiveness Act will save you from having to pay taxes on at least some of the debt forgiveness.  (Without the Act, the debt forgiveness would count as income).   
  • PMI Deduction.  Private mortgage insurance, or PMI, is sometimes required by lenders for homebuyers who make a down payment of less than 20 percent. PMI protects the lender in the event the borrower stops paying on the loan. PMI premiums were deductible from your taxes in 2012 and 2013.

While Congress has allowed the above deductions to expire for 2014, and must reinstate them if they are to apply in the future, the capital gain deduction stands.  Homeowners who have owned and occupied their homes for at least two of the past five years do not have to pay taxes on the gain. The amount of you can gain (tax-free) from such sales varies, depending on your marital status. Married people can earn up to $500,000 on a sale without paying tax on the earnings, and single people can earn up to $250,000 without paying any federal tax.

One more benefit to mention: the Home Office Deduction has been simplified for 2013.  If you have a home office, rather than using a 43-line form (as required in years past), the new method allows home-based workers to simply claim $5 per sq. ft. for up to 300 sq. ft. For example, if your home office is a 10×10 ft. room (100 sq. feet), that’s $500 you can deduct.  Keep in mind – the basic requirements for claiming the home office deduction haven’t changed. Your home office still must be used exclusively for business purposes and on a regular basis.

Whether you have a single-family home, townhouse, or condo, there are tax benefits available to you, but it’s tough to take advantage of them if you don’t know all the details.  Seek help from a good accountant or tax advisor.   

Mary Anne Walser is a licensed attorney and full-time REALTOR, serving buyers and sellers in all areas of Metro Atlanta. Her knowledge of residential real estate and her legal expertise allow her to offer great value to her clients. Mary Anne serves on the Committee that drafts and reviews the contracts utilized by all REALTORS in the State of Georgia. In addition, she is a member of the Atlanta Board of Realtors, the Georgia Association of Realtors, the State Bar of Georgia and the Georgia Association of Women Lawyers. Contact Mary Anne at 404-277-3527, or via email: maryannesellshomes@gmail.com.

 

A HOUSE DIVIDED: The Family Home in a Divorce

27 Friday Sep 2013

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“When we divorced we split the house 50/50 – she got the inside and I got the outside.”

 “Have you seen the new “Divorcing Barbie” doll? She comes with Ken’s house.”

House Divided

             Joking aside, the family home is sometimes the greatest asset to divide in a divorce – so let’s look at how to handle this crucial asset.

It is advisable to call a Realtor early on, when you’re analyzing what assets you have and don’t have.  I often get called in to look at the home and give an assessment of its value in today’s market.  It makes sense to call a Realtor at this point – we typically are more familiar with the neighborhood and have been in the homes that are for sale and have sold, and are accustomed to pricing properties for sale.

There are online tools you can use as well – zillow.com, for instance, which gives you a “zestimate” of what your home is worth, or trulia.com.  However, these services have obviously not been inside your home or the other homes – so they are very general and cannot necessarily be relied upon.  Tax records are also notoriously unreliable.

A crucial consideration at this point may be whether or not the couple is “underwater”; that is, whether you owe more on the property than the property is worth.   If so, to sell the home you would have to bring money to the table.  In other words, in some instances it may not be possible to sell the home.

Also consider early on whether or not you want to fight to keep the home.  Can you afford the monthly carrying costs?  It might not be worth fighting for if it’s something you cannot keep up.

If one party does end up staying in and keeping the home, however, that party may be buying the other party out.  In that instance, professional appraisals are probably in order – each side getting their own appraisal and then perhaps a third appraisal if the two vary widely.  Know that appraisals are an ART as well as a science – while appraisers are bound by the Uniform Appraisal Guidelines and professional dictates, there is some subjectivity in the process.  When you hire an appraiser, you might wish to share with them the comparable sales that you think are most applicable and why they should be used.  Most appraisers are happy to consider the information, although of course they are not bound to use it.

But say the decision is that the home needs to be SOLD.  It’s great if you can both agree on a Realtor.  That actually happens much more often than you might think.  Maybe you both liked the Realtor who sold you the home.  Or know a Realtor jointly who you respect.  Another tactic is to interview three Realtors and see if there’s a clear front runner who you can agree upon.  If not, one way this is sometimes handled is that one party will choose the Realtor for a specified period of time and the other party will choose for the next period – be it 3 months or 6 months.

Several considerations arise here.  Keep in mind that there are various expenses involved in getting the home ready for sale and keeping it maintained while it is on the market.  How those expenses are handled should be decided upon in advance.  You might also want to decide in advance how much the list price will be decreased and when – and what offers should be acceptable (i.e., you can agree that any offer within five percent of list price must be accepted, that sort of thing).

Then there are some very practical showing considerations.  An example will illustrate this point.  We had one client where the wife left with all the nice furniture.  We were left showing a home with very little furniture and a “divorce feel.”  Try to agree to keep enough nice things in the home to make it show well.  Like it or not, buyers are swayed by these things.  Most buyers choose emotionally and THEN justify the purchase logically.  If they walk in and the home feels forlorn and empty, they will not feel great about the home – or may think the seller is in desperate circumstances and thus make a lower offer.  It pays off to have the home nice for showings.  If nothing else, the parties can agree to borrow or rent furniture or to have the home staged for showings.

The home must also be AVAILABLE for showings.  This becomes an issue when the person staying in the home doesn’t necessarily want the home to sell.  Perhaps the other party is paying the bills, and so once the home sells the occupying party loses that support AND must move to a lesser home.

When an offer comes in, keep in mind that your net is less the Broker’s commissions, the mortgage payoff(s) and any repairs that will be necessitated during the inspection period.  Your Realtor can help you figure your net from a given offer.  Again, it is sometimes helpful here to have agreed what amount and type of offer should be acceptable.

A note here if one party stays in the home.  Be aware of title issues.  When you sell the home, a title search is performed.  If there are any liens against the property, these must be paid off before closing.  Even if you do not sell the home, if you are the one keeping the home you want to have a title search before all is finalized.  That way you can be sure the departing spouse didn’t borrow money against the house or otherwise create liens that you will be responsible for when you sell the house and which effect its value.

The final issue – housing options once you leave the family home.  This is for you and your Realtor to decide, but just a few things to keep in mind: do you need to stay in the same school district for the kids?  Do you need to stay close to the other spouse for the children’s sake?  Even the priciest zip codes have affordable options that your Realtor can help you find.  And keep in mind that emotionally you may want to stay in a familiar area; the one you’ve lived in or an area with friends and family near.

MULTIPLE OFFER SITUATIONS

26 Monday Aug 2013

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Sellers Market

Our Atlanta real estate market is currently a strong “seller’s market”. We define a seller’s (vs. buyer’s) market in terms of available inventory.  If there is six months or less of housing inventory on the market, it’s a seller’s market – more than six months of inventory is a buyer’s market.

When we say “six months” worth of inventory, that means that if nothing new were to come on the market (hypothetically, of course), it would take six months to sell everything that it currently listed.  This is calculated this way

  • We compute the total number of active listings on the market last month in the area under consideration;
  •  Then compute the total number of sold homes for the that month;
  •  Then divide the number of current active listings by the number of total sales for the month, which gives you the months of inventory which remain.

Using this formula, the Atlanta Metro area has less than five months of active listings (in some areas, less than three).  So listings are often going under contract within the first day or two they are available, with multiple offers.  A seller who gets multiple offers may pick the best one and respond to it OR may decide to contact all bidders and request their “highest and best” bid and go with the bid the seller finds most advantageous to them.

If you are a buyer trying to “win” in a multiple offer situation, it goes without saying that you should place your HIGHEST offer – the most amount of money that you are willing to pay for the property.  The seller will usually go with the highest bid, but not always.  There are other factors important to the seller: how likely a buyer is to get to the closing table, for instance (so a buyer with cash is “king” – because loans can fall through, of course).  This is why the seller asks not only for your “highest” offer, but for your “highest and BEST” offer.  Let’s look as some of the factors that will help your offer be the “best” offer.

First, if you can avoid asking the seller to pay closing costs, I would recommend that.  A seller will perceive a buyer who is asking for closing costs as not as strong a buyer.  A strong buyer has enough cash on hand to pay their own closing costs and can avoid rolling those closing costs into the loan by asking the seller to pay for them.  (What the seller cares about is the seller’s “net” – contract price minus closing costs paid.  By asking the seller to pay closing costs you are offering them “less” than the contract price and perhaps indicating that you are not as strong  a buyer).

Another seller consideration is how difficult the seller perceives that the buyer is going to be during the contract to close process.  A buyer who asks for too much in the opening bid may be perceived as a scared buyer who is more likely to terminate the contract during the due diligence period.  Or one who is likely to ask for excessive seller concessions during due diligence.

Here are some other pointers if you are the buyer placing a bid against other offers:

  • Make your offer a CLEAN AS POSSIBLE; meaning avoid stipulations.  Keep those stipulations you do include as simple as possible.
  • For instance, we will sometimes insert a stipulation asking for a professional cleaning of the property from the seller prior to transfer of possession.  If there are multiple bids, LEAVE THAT OUT.  That stipulation is sometimes taken the wrong way by sellers who think that they are indicating that the property is less than clean, and that may be the thing that prevents you from getting the property.  You can pay for your own move in cleaning if the seller doesn’t (and many, if not most, sellers will have the property professionally cleaned without you asking for it)– but don’t risk losing the property by asking for this when there are other offers.
  • The same thing goes for other items you might otherwise ask for: a survey, condo documents, etc.  You can pay  for a survey yourself and still *ask* for the condo documents (or have your agent get them) during the due diligence period. Asking for them in the initial offer may, all other things being equal, cause a seller to choose another offer that is simpler for the seller.
  • You may be competing against other offers that DO NOT HAVE a financing or appraisal contingency.  If you need financing, you must have those contingencies (unless you have enough cash to cover if the property ends up not appraising for full contract price and are willing to take that chance). But keep this in mind – know that some buyers will pay cash without a loan OR appraisal contingency for a hot property.  So you may be beat out not on price but by a buyer in that position.
  • So if you must have a loan and appraisal contingency, make them as clean and enticing as possible.  Here are some guidelines: indicate in the contingency how much money you are putting down – more is better to the seller, of course.  If you are putting fifty percent down,  you are a stronger buyer than someone putting twenty percent down, for instance.  Keep the loan and financing contingencies as tight as possible – 21 to 25 days is the norm, but go shorter if you can in order to present your offer in the best light.
  • HAVE A PREAPPROVAL LETTER (or proof of funds if you are paying cash).  Most sellers won’t even consider an offer with a prequal or proof of funds.  It is best if that preapproval letter is from a recognized lender who regularly does mortgage loans so that the seller is reasonably certain that the lender will not botch the deal.
  • You may also be competing against an “AS IS” offer; that is, one in which the buyer says that they will purchase the property without asking for any repairs.  (In an “as is” contract, the buyer still has a right to inspections, but has agreed not to ask the seller for any repairs). Therefore, if you do want a due diligence period, keep that period as short a possible (typical is 7 to 10 days – in multiple offer situations, I definitely recommend not going over 10 days).

Finally, it sometimes helps to use a “personal touch”.  Tell the seller something about yourself.  We call this a “buyer’s letter” and I will often write them for clients in situations where I think it would be helpful.  Tell them what you like about the home and give them information so that they know you’ll be a good neighbor.  Not all, but many sellers care very much about what type of person is purchasing their home and what type of neighbor that person will be for the friends that they are leaving behind.

Put your best foot forward when there are multiple offers – remember that you are competing not only on price; and good luck!  If your bid is NOT the winning bid, consider asking the seller to hold on to it as a “back up offer” in case the winning offer falls through.

PREPARING YOUR HOME FOR SALE

31 Wednesday Jul 2013

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So you’ve decided that you want to sell your home.  The first question is WHEN should you sell?  The prime months for selling vary year-to-year, but in good years and bad, generally the “peak” times are from March 1st through Memorial Day and from mid-August until the week before Thanksgiving (conversely, the “slow” periods are typically the summer & winter vacation months, and the holiday lull extends through February).

But also remember that there are ALWAYS buyers out there.  Even in our “slow” months there are buyers ~ and there’s less inventory.  So although it may seem counterintuitive, if your home comes on the market in a “slow” month it may actually help your chances of selling.  In times of limited inventory, the listing is king!

Regardless of your target date for putting the house on the market, your preparation for selling should begin months before.  It is never too early to contact an agent and start getting your home prepared.  Your agent or your agent’s stager will give you a list of things to do to get your home ready, and the earlier you start on them the better.

And please do not be insulted by the list of things your agent or stager tells you to do in order to sell.  All of us start to overlook the little quirks that a home develops and the clutter that accumulates once you live in a place for a while.  To sell your home at top dollar, you want your home in great condition and looking its best.  That means putting aside a little pride and listening to what the professionals ask you to do.  It really does pay off!

If you want to get started NOW, here are some general guidelines we give clients:

GENERAL STAGING GUIDELINES:

1. Gather packing supplies; boxes and tape or plastic bins.  Also gather boxes and bags for those items you want to donate to charity.

2. Take everything off the floor of every closet and find another place for it if you can – ideally, nothing is on the floor of any closet.

3. Pack up half of what is in every closet.  Half of your clothes, half of everything else – make sure every closet looks SPACIOUS and incredibly neat.

4. Clear as much stuff off every horizontal surface as you can.

5. In one place, have any staging “extras” that you may have – extra pictures, vases, pillows, towels, etc.  Your agent or stager may be able to use them in getting your home ready..

6. Make sure all lights work and no lightbulbs are out.

7. Fix anything you know needs to be fixed; that icemaker that stopped working, the siding boards that need to be replaced, and the faucet that is dripping.

8. Take down all of your personal pictures, then just put back out one or two on each floor (minimal personal pictures, but enough to personalize and let the buyer know that you are a “real” person).

Those should get you started.  And who knows, after you clear some clutter and fix up things you may decide you want to stay.  If not, it is time to call in your Realtor.

HIRING AN AGENT

24 Wednesday Jul 2013

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So you have decided that it is time to sell your home and move on to a smaller home, a larger home, or just greener pastures.  How do you find an agent?  You might ask your friends and colleagues who they recommend; you might decide to hire the “neighborhood expert”; or you might already know a great agent you would like to use.

If you are not certain who you want to use, it is time to call in several agents, meet with them and have them look at your home, and then decide who you are most comfortable with.  There are many factors to consider and questions to ask:

  • Is the Realtor a FULL TIME agent?  You do not want to hire anyone who only does real estate part time – they cannot give your home the attention it deserves.
  • Is the Realtor with a reputable company, and are they well connected/well liked among other Realtors?
  • Does the Realtor have an assistant to help with marketing efforts so that if the Realtor is very busy someone is still marketing your home full time?

Hire who you are most comfortable with, not necessarily the agent who gives you the highest suggested list price.  Some agents will give you an inflated price to entice you to list with them.  Overpricing your home can be deadly, since the longer a home sits on the market the less desirable it is to buyers and the less you will ultimately get for the home.  Go for the agent who is the most knowledgeable and realistic about your home’s value over the one who gives you a high price just to get you to sign the agreement.

Ask what services the agent offers as part of the listing – among the things a great agent may offer are professional photography, staging services, full color professional brochures, agent caravans, and videography.  Let the agent know what you expect from them – some sellers like to be contacted by the agent as much as possible, while others just want a phone call when an offer comes in.  Let your agent know what works best for you.

And as the listing moves forward, let the agent know whenever you are unhappy about anything and give them the opportunity to rectify it.  Most of us will bend over backwards to make a seller happy, and to sell the home.

DECIDING TO SELL YOUR HOME

04 Tuesday Jun 2013

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The first step in selling your home is, of course, deciding whether it is TIME to sell.  Have you outgrown your current home?  Is it too large and do you want to downsize?  Are you ready to move up to a nicer home or down to a smaller one?  Ready to change neighborhoods, schools, or towns?

If you have a choice in whether or not to sell your home (i.e., if it’s not a job transfer or other life change dictating the move) let’s discuss some of the factors you’ll want to consider.

If you are UP sizing to a more expensive home then a good time to move is when the market is LOW.  You’ll get less for your current home, but will get a better deal on the home you’re purchasing.  Conversely, if you are downsizing then you may consider it better to move when the market is HIGH so you can maximize the return on your current home.  Know that whether the market is “high” or “low” often depends upon the price range you are considering and the area of town.  Best to consult a real estate professional to discuss your specific situation in order to plan what is right for you.

Even if committed to moving, many potential sellers want to find out if there is a home they want to move TO before they put their current home on the market.  Not a bad idea.  But unless you can purchase a new home without selling your current home, do not get too invested in finding the “perfect” home before you sell your current home.  Your goal should be to see if there are houses (more than one) you would like to move to so that you are comfortable putting your home on the market.  But chances are that if you fall in love with one particular home, THAT home will be sold by the time you get your home on the market, get it under contract, and are ready to write an offer.  So on the exploratory search the goal should be to determine whether there is likely to be a home you will be happy moving into when your home sells.

In other words, it is somewhat of a leap of faith.  You put your home on the market trusting that you will find the “right” home to move into when the time comes.  Of course, you have some control over this process since if you price your current home correctly it should sell quickly.  But know that few if any sellers will agree to a “sale of property” contingency if your home is not at least under contract.

Here is how that works: if you must sell your current home to purchase a new one, then you submit an offer for that new home with a contingency stating that your purchase of the new home is contingent on the sale of your current home.  From the perspective of the seller who you are making that contingent offer to, it would be quite risky to agree to that contingency if your current home is just “on the market” and not yet under contract.  There’s no guarantee that your home will sell quickly – and the seller is taking their home off the market if they get under contract with you.

So consider the market, the neighborhood, and your personal circumstances.  This may be the perfect time for you to move.  Generally, prices are rising but interest rates are still low.