Tuesday, April 29, 2014

Why is my home not selling?


There are many reasons why a home is not selling. Some reasons carry more weight than others. Here are 7 common reasons why your home isn't selling.

Who is your Sales professional?
 Every real estate market has hundreds or even thousands of real estate agents in their respective board. Just like “no two people are alike,” “no two real estate agents are alike!” Every real estate agent has different ways of communicating, how responsive they are, how they negotiate, their energy level, and many other characteristics that differentiate one agent from another. Selecting the “right” real estate agent to sell your home is a vital part of whether a home will sell. Both their budget as well as mastery of  negotiation & marketing makes such a huge difference. 

What is the Marketing  Plan?
 According to the National Association of Realtor's, 92% of home buyers use the internet for their home search. Is it important to have a real estate agent who is an internet marketing professional? Absolutely!!! The real estate agent should have a strong internet presence which should include their own website, an active blog, and also social media presence. With the growth of social media, it’s important that the real estate agent know how each network will benefit the listing.

Real Estate Agents who “Buy Listings” 
It is very common that a seller has no idea their real estate agent has “bought the listing.” What is a real estate agent who “Buys Listings?” Simply put, it’s a real estate agent who tells a seller what they want to hear not what they need to hear! This can include the pricing of a home, suggested (or lack of) repair items to make a home saleable, de-cluttering, or depersonalizing. These “Yes” men or women will agree to anything a seller says just to get get exposure to potential buyers.

Where did you come up with your price?
As long as the home is properly advertised price is the number one reason a home does not sell. If a home is overpriced, the other 4 common reasons below mean nothing. Even if you hire the number one local real estate agent with the best marketing plan, it won’t matter if your home is overpriced! The price that a home enters the market at will do a lot of the marketing of the home. Today’s home buyers are well educated and have access to a wealth of information. 

How universally appealing is you decorum?
Every buyer has different tastes and preferences. A homes décor can be a reason why your home isn't selling. It is impossible to predict exactly what every buyer who walks through a home is going to think about the carpet, flooring, wallpaper, or wall color. Just because you love the floral wallpaper with the matching vertical blinds, does not mean that it will “appeal to the masses.” Wallpaper for the most part is no longer a desired style. The best rule of thumb is when in doubt, neutrality is king!

What is the condition of your home?
Most home buyers in today’s society do not want to do a lot of “work” and are reluctant to take on a “project.” A home that may have damaged and/or cracked walls, damaged siding, broken windows, worn carpet in every room, strong odor, mold issues, or other “poor conditions” will take time to sell. A home, even though priced to reflect the condition, still may not sell. Once again, many of these “poor conditions” can be corrected and/or repaired fairly inexpensively. In some cases it can be advantageous to do these corrections prior to listing as it may lead to a quicker sale and for more money.

Where is the home located?
The saying “Location, Location, Location” is commonly heard in the real estate industry. If a home isn’t selling, location is a difficult one to correct. A home can be in mint condition, have excellent mechanics, and be a perfect layout but if it’s location is less than desirable, it can be a reason a home isn’t selling. A few examples are a buyer who eliminates any home that is on a primary road, corner lot, or located near a highwayHomes that re located in a less than desirable location normally will have greater days on the market (DOM) and lower sale prices than other comparable properties that are located in a less than desirable location normally will have greater days on the market (DOM) and lower sale prices than other comparable properties.

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Tuesday, April 22, 2014

Understanding The FHA Short Sale

Understanding The FHA Short Sale

Understanding the FHA Short SaleA homeowner may be eligible for an FHA short sale if the hardship of seller is determined by the HUD. The government has its involvement in short sale so almost all the FHA short sale falls under the Housing and Urban Development guidelines. A short sale may be tricky and confusing to understand for agent and sellers.  Below given tips may be helpful to understand the FHA short sale.

FHA Short Sale Guidelines

If the short sale is on the short track to nowhere, then there are chances that it is stuck in the FHA waterfall. FHA may want to look for loan modification possibilities. Your FHA short sale process will be much faster if your loan modification was rejected.
The home is identified as 1 to 4 units. This means a duplex or fourplex can qualify for the FHA short sale, but a 5-unit apartment building cannot. Vacant houses are not allowed to be renting out more than eighteen months.  A variance must be obtained to proceed the FHA short sale if the home was given on rent out more that eighteen months. Obtaining the variance is a time taking and lengthy process.
The house must not be purchased as an investment or as rental otherwise it will not qualify for FHA short sale. Seller must be facing the hardship to qualify for a short sale. Sellers that want to walk away from home or want to opt for strategic short sale will not qualify.
The seller must be at least thirty days delayed on mortgage payments. HUD is very much careful about saying to stop making mortgage payments. If the sellers are not delinquent he will not be able to meet the criteria.
Important Questions About The FHA Short Sale:
Here are some important questions about FHA short sale that may be helpful to understand the process.
How much time is required to do an FHA Short Sale?
The estimated time required for short sale may be between four to six months, but depending upon the situation it may take more time. According to the circumstances HUD may provide another two months extension. It is sure if the government is involved there will be some delay in the process. If the Bank of America is involved the HUD will issue an approval to participate after taking a long time and stressful process to determine the seller’s hardship and property qualify for the FHA Short Sale. After that the seller will be given duration of four months to sell the home. While other banks approve the FHA short sale based on the purchase contract.
How to determine the Value for an FHA Short Sale?
HUD will go through a proper appraisal process to get the market value. It will not be allowing the inclusion of a short sale and foreclosure prices until they are the only option to determine the value. Sometimes final approved sale price may be unreasonable due to the elimination of competing sales, which is a flaw in the pricing process.
Is it possible for seller to receive cash for an FHA Short Sale?
Yes, if the compensation is not supposed to be used as the contribution to the second loan. The incentive amount starts out at a $1,000 and if the sale is not closed within 90 days, it drops to $750. The seller will be required to contribute a part of full incentive to the second loan if the second lender requires more than $15, 00 to settle the deal. If the second lender requires more than $1,500 to settle the short sale, the seller will be required to contribute a part or all of the incentive to the second lender.
Will FHA allow a seller credit toward the buyer’s closing costs?
Yes, FHA will allow 3% credit when FHA is insuring the buyer’s financing, FHA will not allow more than a 1% credit in an FHA Short Sale. It is true that some FHA buyers require cost credit for paying the closing cost. FHA expects to net 88% of its approved sales price. If the net proceeds exceed the FHA minimum, it is possible that FHA might approve a higher seller contribution to the buyer’s closing costs.
What is the Drawback of FHA Short Sale?
The main drawback of FHA short sale is the time required for the process of a short sale. It will make much easier if the seller applies for a loan modification and the application is rejected, followed by an application to get preapproved for an FHA short sale. First hire a short sale agent if accepted into the FHA preforeclosure program and go on the market at the preapproved price.

Mortgage Rates Survey - Freddie Mac

Primary Mortgage Market Survey

Saturday, April 19, 2014

Justin Thayer / Team Thayer Real Estate 10 year anniversary today!

Say happy work anniversary!
LOOKING FOR A NEW HOME?

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5 REASONS TO SELL YOUR HOME NOW

Many sellers are still hesitant about putting their house up for sale. Where are prices headed? Where are interest rates headed? Can buyers qualify for a mortgage?  These are all valid questions. However, there are several reasons to sell your home sooner rather than later. Here are five of those reasons.
1. The Most Serious Buyers Are Out Now
Most people realize that the housing market is hottest from April through June. The most serious buyers are well aware of this and, for that reason, come out in early spring in order to beat the heavy competition. These buyers are readywilling and able to buy…and are in the market right now!
2. There Is Less Competition Now
Housing supply always grows from the spring through the early summer. The choices buyers have will continue to increase over the next few months. Don’t wait until all the other potential sellers in your market put their homes up for sale.
3. The Process Will Be Quicker
One of the biggest challenges of the 2014 housing market has been the length of time it takes from contract to closing. Banks are requiring more and more paperwork before approving a mortgage. As the market heats up, banks will be inundated with loan inquiries causing closing timelines to lengthen.  Selling now will make the process quicker and simpler.
4. There Will Never Be a Better Time to Move-Up
If you are moving up to a larger, more expensive home, consider doing it now. Prices are projected to appreciate by over 19% from now to 2018. If you are moving to a higher priced home, it will wind-up costing you more in raw dollars (both in down payment and mortgage payment) if you wait. You can also lock-in your 30 year housing expense with an interest rate at about 4.5% right now. Rates are projected to be well over 5% by this time next year.
5. It’s Time to Move On with Your Life
Look at the reason you decided to sell in the first place and decide whether it is worth waiting. Is money more important than being with family? Is money more important than your health? Is money more important than having the freedom to go on with your life the way you think you should?
You already know the answers to the questions we just asked. You have the power to take back control of the situation by pricing your home to guarantee it sells. The time has come for you and your family to move on and start living the life you desire.


That is what is truly important.

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Sunday, April 13, 2014

Lack of sellers, preponderance of buyers pushing housing prices

WASHINGTON -- Entering the 2014 spring buying season, the U.S. housing market faces an unusual dilemma: Too few people are selling homes. Yet too few buyers can afford the homes that are for sale.
"Both sides of the equation are in a funk," said Glenn Kelman, CEO of the real estate brokerage Redfin.
A 13.4 percent jump in the average price of a home sold last year, according to the Standard & Poor's/Case-Shiller 20-city index, hasn't managed to coax more homeowners to sell. And combined with higher mortgage rates, higher prices have made homes costlier for first-time buyers as well as for all-cash investors.
In this Thursday, Jan. 9, 2014, photo, a  for sale sign hangs in front of a house in Mount Lebanon, Pa.
In this Thursday, Jan. 9, 2014, photo, a for sale sign hangs in front of a house in Mount Lebanon, Pa. (Gene J. Puskar/AP Photo)
Average prices nationally are expected to rise by single digits this year. The gains could be strongest in areas with solid job growth, such as Seattle and Austin, Texas. And while construction will put more homes on the market, lack of affordability could keep sales flat to falling.
On the other hand, many lenders are easing the barriers for those with less-than-sterling credit. For these people, qualifying for a mortgage could become a little easier.
All of which leaves real estate, much like the rest of the economy, still trudging back to health nearly a half-decade after the recession ended. After last year's growth spurt, the housing recovery may have begun an awkward adolescence, one prone to fits and starts that can defy predictions.
Here are five vital signs that will shape home sales this spring and the rest of the year:
WHERE ARE THE SELLERS?
Good question. It's slim pickings for a lot of would-be buyers. That brutal winter we just got through prevented many East Coasters from listing their homes in recent months. About five months' worth of homes are on the market, compared with 5.9 months in 2012 and 8.3 months in 2011.
Housing supply previously dipped toward the 5-month level during the height of the boom in 2006, when buyers snapped up homes faster than they could be added. This time, fewer homes are being listed because 19 percent of owners are underwater on their mortgages -- meaning the sales price wouldn't be enough to repay their loan.
Still, warmer weather, job growth and a strengthening economy are expected to encourage more listings this spring.
"We're all trying to figure out where the sellers are," said Redfin CEO Kelman. "Everyone seems to be waiting until April or May or June."
About 60 percent of Redfin buyers faced bidding wars in February, down from 73 percent at this time last year.
When few sellers emerged last year, prices for the limited number of homes available surged. Would-be buyers, facing a shortage of homes and locked in competition with one another, raised their offers.
Prices climbed in locales such as San Francisco, where a ton of money is chasing few properties and there's not enough construction. Bay Area homes have surged 23 percent, on average, the past 12 months, according to the S&P Case-Shiller index. That was faster than any other major metro area except Las Vegas, where much of the housing stock was rebounding from the depths of the recession.
This problem usually corrects itself. Higher prices should lure more sellers into the market who see an opportunity to cash out. That would then lead to more listings and ease the face-offs among buyers. Sales data suggest that this has happened in Los Angeles, where more homes have been put up for sale, and they're staying on the market longer.
But around the country, many homeowners are still reluctant to sell because they would likely lose money on the deal. The 2007 housing bust still haunts the market.
About 19 percent of homeowners owe more on their mortgages than their properties would sell for, according to the online real estate database Zillow. An additional 37 percent are "effectively underwater": Their sale profit would be too low to cover the cost of listing their home and putting a down payment on a new property.
Still, each mortgage payment repairs some of the damage and improves a homeowner's equity. As home values grow further, more people will start to put their homes up for sale, and the supply should rise.
FIRST-TIME BUYERS NOT BACK (YET)
After the Great Recession officially ended in mid-2009, many economists predicted that pent-up demand for homes would drive sales in the years to come. Not exactly. Nearly five years into the recovery, buying remains subpar.
Sales of existing homes are projected to total 5 million this year, according to the National Association of Realtors. That's about 100,000 fewer than last year and far below the 5.5 million associated with healthy markets.
Much of that shortfall can be summed up simply: Too few first-time buyers. They bought about 1.5 million homes last year, about 500,000 fewer on average than they would have typically.
Last year's price increases makes affordability a growing obstacle for first-timers, said Jed Kolko, chief economist for the online real estate firm Trulia. Unlike current owners whose down payments come from selling a previous home, first-timers must amass a down payment. And higher home prices require more cash up front.
The situation is slowly improving for the 25- to 34-year-olds who would buy homes. About 738,000 of them found jobs in the past year. With more disposable income, more of them will move out on their own. Homebuilders have already ramped up apartment construction in anticipation of younger renters. That's a critical first-step before they eventually buy a house or condo.
"I don't think it will have a big impact on homeownership right away," Kolko said, "because it will take some time for young adults to save and build a credit history to buy a home."
CREDIT STANDARDS ARE LOOSER
You might have thought the economic meltdown would have shut off home loans to people with middling-to-weak credit. Yet something close to subprime borrowing has just started a comeback.
Wells Fargo is now offering mortgages to subprime borrowers with credit scores as low as 600, down from 640. (The median credit score for 30-year fixed mortgages had been around 730.) And non-bank lenders such as Carrington Mortgage Services are moving into that territory. Carrington has dropped its minimum credit score to 550. It's a sign that lenders are becoming less tightfisted after restricting credit in the wake of the financial crisis.
Lenders are accepting borrowers they once rejected in part because they're hungry for more business after mortgage refinancing plunged in the past year as interest rates rose. The average 30-year fixed mortgage rate has risen about a percentage point to 4.4 percent from near-historic lows in May. A subprime borrower with a credit score of 550 would pay 7.15 percent, according to Carrington's rate sheet.
FEWER INVESTORS
Investors bought roughly one in every five homes sold last year, according to the National Association of Realtors. Most of them made all-cash offers and ignited bidding wars that other would-be homeowners lost. The investors' properties became rehab projects or rentals.
But the 2013 price jump should cause investors to play a lesser role this year. Areas that suffered the most during the recession's housing bust, like Phoenix, Las Vegas and Tampa, have seen prices rise. They're no longer the bargains that investors considered them to be a year ago, said Zillow's chief economist Stan Humphries. The result is that bidding wars won't likely be as fierce in 2014.
Not all investors are disappearing. They're pursuing areas where homes can most easily be converted into rentals and deliver higher returns. Home prices in Cincinnati, for example, rose an average 2 percent last year, but rental prices jumped 10 percent. Similar trends can be seen in the Midwest.
HIGHER-END HOMES ARE HOTTER INVESTMENTS
It's better to be on the luxury side of the real estate market for the moment. Prices generally rise faster than at the lower end. And buying activity has increased in the past year.
Sales of homes worth more than $1 million rose 14.4 percent over the past 12 months, according to Bank of America Merrill Lynch. By contrast, sales of properties valued at less than $100,000 dropped 18 percent. A key reason: Fewer foreclosed homes are being listed.
Prices for more expensive homes have also risen much faster, according to Zillow. The online real estate firm divided the U.S. housing stock into thirds based on price. Homes now worth $305,700 or more -- the top one-third of the market -- rose in value annually at a 3.38 percent average during the past 18 years. Those prices grew 20 percent faster than did the bottom two-thirds of the market.
"Essentially, it's a tale of two markets," said Zillow's Humphries. "Your experience as a top-tier homeowner was substantially different than for a bottom-tier owner."

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