October 6, 2011 10:57 pm
We need to keep housing first on the nation’s public policy agenda, because housing and homeownership issues affect all Americans, and a housing recovery is necessary for the nation’s economic well-being.
That was the message delivered by National Association of REALTORS® President Ron Phipps recently during the New Solutions for America’s Housing Crisis forum, where he joined a panel of experts to discuss solutions for addressing the country’s housing and economic challenges. The event was hosted by Economic Policies for the 21st Century and the Progressive Policy Institute.
“As the leading advocate for homeownership, REALTORS® know that issues like affordable financing, natural disaster insurance, the mortgage interest deduction, and foreclosures and short sales don’t just affect people who own a home—homeownership shapes communities and strengthens the nation’s economy,” says Phipps. “America needs strong public policies that promote responsible, sustainable homeownership and that will help stabilize the nation’s housing market to support an economic recovery.”
Phipps said that housing is not recovering at the rate it should be and called on legislators and regulators to do no harm. He said that proposed legislation and regulatory rules or changes to homeownership tax benefits need to help America out of today’s economic struggles and not further harm consumer confidence or exacerbate problems within the fragile real estate industry.
Overly stringent standards and lower mortgage loan limits are preventing qualified borrowers from getting loans, and Phipps called on lenders and regulators to reduce the overcorrection in underwriting standards for mortgages. He urged support for policies that ensure qualified borrowers can obtain safe and sound mortgages in all markets at all times and encourage sound lending without high downpayment requirements.
“REALTORS® support strong underwriting, but too stringent standards are curtailing the ability of creditworthy consumers from obtaining mortgages to purchase a home, and that’s impacting the recovery,” says Phipps. “Making mortgages available to creditworthy home buyers and streamlining loan modifications and short sales will help stabilize and revitalize the housing industry and reduce the rising inventory of foreclosed homes.”
Phipps recommended that political and industry leaders work together to help reshape real estate and put the country back on the right track. “Our goal is to help ensure that anyone in this country who aspires to own their own home and can afford to do so is not denied the opportunity to build their future through homeownership,” Phipps says.
For more information, visit www.realtor.org.
October 6, 2011 12:09 pm
According to a recent survey conducted by the Consumer Electronics Association (CEA) that polled 1,793 real estate agents, home theater-wired systems, home security systems, home automation management systems and energy management systems are selling faster than ever before, making technology a must-have for buyers.
“There is a strong relationship between home technologies and the real estate market,” said CEA’s Rhonda Daniel in a recent press release. “While the market needs to recover before home technologies play a more important role in home sales, the industry can help prepare real estate agents to be comfortable in discussing these types of systems with their clients.”
The survey shows that in the last two years, the number of real estate agents who have been involved in buying, selling or showing a plugged-in home equipped with technology has risen substantially.
Ninety-three percent of real estate professionals reported showing homes that featured established systems such as monitored security. In addition, 89 percent indicated they had shown a home that included a home theater or home theater-wired system; 54 percent showed homes that featured home automation and management systems and 51 percent showed homes with energy management systems.
The survey also shows that 68 percent of REALTORS® believe home technologies will play a more important role in the success of home sales within five years. Whether those REALTORS® are involved in new construction or previously owned homes, this number is a strong indicator of when REALTORS® believe the real estate market will fully rebound.
“Manufacturers and electronic systems contractors should be laying the groundwork now to take advantage of the eventual upswing in the real estate market,” Daniel said. “Educating REALTORS® on the benefits, value and functionalities of installed technologies now will demonstrate that the consumer electronics (CE) industry can be a trusted partner to equip them with the knowledge they are lacking.”
Nearly two-thirds of real estate agents surveyed offered that their clients are excited to see technology in homes. That means current homeowners looking to sell should consider upgrading their home with some sort of home technology system.
“The ideal goal for the consumer electronics industry is to have knowledgeable real estate agents who are excited and open to promoting technology as a selling feature of homes,” Daniel said.
A lesser fix to appeal to prospective buyers who crave technology is to simply make sure that there are enough outlets, cable lines and phone jacks within the home so that someone coming with their own equipment will have an easy time setting it all up. A home with only one outlet in the family room or media room and no place for a fiber optic line to be added can be a turnoff for today’s buyers.
To learn more about incorporating technology into your home, contact our office today.
October 6, 2011 12:09 pm
With the current state of the housing market, the words “short sale” are being thrown around quite a bit, but many people don’t understand what those words really mean.
The theory behind a short sale seems simple enough: If a homeowner owes more money on a house than it can be sold for and is having trouble paying the mortgage, the bank will allow the house to be sold for less than is owed.
A short sale can also be the best option for a homeowner who is “upside down” on their mortgage because short sales don’t generally hurt a homeowner’s credit history as much as a foreclosure. As a result, homeowners may qualify for a mortgage in less time once they get back on their feet financially.
The problem, however, lies in the banks, as they would rather collect the full amount owed, making the short sale process more difficult than it has to be.
Last April, The Home Affordable Alternatives Program (HAFA) released new guidelines that were designed to streamline the process and allow more delinquent homeowners to sell their homes and get on with their lives.
Over the course of the first 18 months under the program, more than 16,000 HAFA agreements have been made with approximately 8,000 transactions completed.
HAFA complements the Home Affordable Modification Program (HAMP), a loan modification program designed to reduce delinquent and at-risk borrowers’ monthly mortgage payments by providing alternatives for borrowers who don’t qualify for or don’t complete a trial modification.
“They are designed to help people who are unable to keep their home under the HAMP loan modification program,” said Jeff Lischer, managing director for regulatory policy for The National Association of REALTORS®. “Let’s say you can’t keep your property under HAMP, the next step is a short sale, which is better than a foreclosure.”
Housing professionals claim that lenders lose about 40% of a property’s value on a foreclosure. This is reduced to about 19% on a short sale. The short sale is a graceful exit from the ownership, which is better for a homeowner’s credit score and it makes sense from the standpoint of helping your neighbors, too.
The guidelines also provide incentives for the borrower to go this route. The first incentive is designed to help the seller relocate, as they will receive a check for $3,000 to help them cover the costs associated with a move. The second incentive is for mortgage servicers, who will get $1,500 from the Federal Government for each completed short sale.
To qualify, homeowners must meet certain requirements, but since foreclosures are considered a lose/lose situation, the new rules can make the short sale process a win/win.
The loan must be less than $729,750; made before January 1, 2009; and the home must be the owner’s primary residence. Also, the homeowner must be delinquent and unable to pay their mortgage in addition to the mortgage payment being more than 31% of their before-tax income.
The new guidelines also allow a homeowner to get a short sale approval in advance, by allowing the owner to receive a pre-approval from the bank that includes the minimum net amount it will accept.
To learn more about short sales, contact our office today.
October 6, 2011 12:09 pm
As the fall season marks its arrival with cooler temperatures and shorter days, bringing the outdoors in and taking advantage of fall décor is one way home sellers can set their house apart from the rest. While you don’t want to go overboard, you can have some fun while incorporating fall themed items into the mix.
Creative a festive scene right on your dining room table with a fall inspired floral arrangement in an eye-catching polished copper or silver container or even an apple basket. Mix in a few berries or branches to bring a bit of nature into the scene.
Decorators recommend adding plaid or a fall colored fabric for use as runners, simple throws or pillows. If you want to kick it up a notch, replace solids by adding materials featuring a Moroccan vibe in plum, bronze or gold for a luxurious play of color.
“Bring a taste of the outdoors in with distressed wood pieces like log vases or birch-themed pedestals to display candles or flowers,” said Michael Sullivan, an interior decorator in Fairfax, Virginia. “You can incorporate twigs, branches and berry stems for an organic look.”
Corn is another great decorating item that home sellers can take advantage of this fall. It can be placed in a bowl, hung up in a design or used as the centerpiece of a display.
A wreath on the door is another decorative element that can add character to an entryway that may normally be plain or basic.
Individual silk leaves can be scattered on tables, leaf garlands can be strung across a staircase banister and a leaf wreath can serve as the focal point of a mantel when hung on a wreath stand.
“Accentuate the home with a splash of harvest colors of yellow, orange, gold, green, wheat and brown,” Sullivan said. “These hues will add a sense of warmth and comfort to your interior, which can get buyers interested.”
Outside, seasonal finds are aplenty with mums, kale, pumpkins and gourds. Creating an eye-catching fall garden in the front of the house is always a welcoming sight for prospective buyers. Just remember to rake the leaves regularly. The last thing you want a buyer to see is a lawn full of leaves, conveying the message that a lot of time is going to be spent raking during the fall.
Halloween decorations can create a festive look as long as you don’t go overboard. While a few carved jack-o-lanterns, ghost lights and witch hangings will get people in the spirit of the season, you don’t want the house overflowing with fake cobwebs or have monster cutouts lurking in every room.
Leaving Halloween cookies on the counter during home showings is also a great way to get people in the right mood as they walk around the home.
For additional ways to prepare your home for sale, contact our office today.
October 6, 2011 12:09 pm
Real estate agents agree that vacant houses are a growing segment of the real estate market and pose unique difficulties for showcasing and selling a home. There is a misconception that a vacant home is easier to sell, but professionals in the field understand that an empty house can scare prospective buyers away.
Most home buyers cannot see beyond an empty home. With no furniture to focus on, a buyer will be much more inclined to narrow in on any imperfections—spotting the scratch on the floor, the nail holes in the wall, grout in the kitchen or the coldness that an empty room can convey.
“People aren’t looking to buy a house, they are looking to buy a home,” said Birgit Anich, a home stager with Connecticut-based Staging & Interiors. “Without furniture, wall art, rugs, lighting and décor, there are no emotional connection points in the house. The house does not show its soul or offer any lifestyle that buyers can aspire to.”
When a prospective home buyer perceives flaws and can’t focus on the home’s potential, there will be fewer offers, greater price reductions, more days on the market, higher carrying costs, and less profit.
Additionally, prospective buyers beginning their search on the Internet are less likely to look at your online photos if all they see are empty rooms.
Chances are, if you’re already paying a mortgage on a new home, you’re going to want to sell your old home fast. A vacant home conveys this message to potential buyers and sets the stage for a better negotiating strategy since they know you want to sell quickly.
There is a lot of money on the table because of ongoing costs related to the mortgage, maintenance, insurance, and other carrying costs that need to be paid for while the property is sitting on the market without any income stream.
If you are in the process of selling a vacant home, take the time to bring in a stager to fill the space with furniture and make the home look lived in. By providing prospective buyers with a welcoming atmosphere, they’ll be more apt to see themselves living in the home rather than pointing out what they don’t like about the place. Staging will help to emphasize the positive features of the property while downplaying the negative features.
“Never sell a home without furniture. In my experience, I’ve seen tremendous results when staging a vacant home,” said Los Angeles home stager Elizabeth James. “Buyers become overwhelmed by a lack of vision in each space with no identifiable purpose.”
By taking the time to stage a vacant home, you will create that vision and get a quicker and hopefully more profitable outcome.
For more information about selling a vacant home, contact our office today.
October 6, 2011 12:09 pm
While getting your home ready to put on the market can be a huge undertaking, sellers shouldn’t overlook the importance that color plays in the process. To help sellers understand the effects that certain colors will have on prospective buyers, Pantone LLC, a global authority on color and provider of professional color standards for the design industries, recently released its forecast for the most popular interior colors for 2012.
This forecast is important for anyone getting a home ready to sell, especially in today’s difficult market as it will help sellers choose interior paint colors and furnishings that appeal to the masses.
“This is the road map to color for 2012, which is filled with interesting new directions. Some paths lead to exhilarating tones that encourage the prospective buyer to forge ahead into adventures with novel color combinations, while others invite them to stop for a moment, take a deep breath, relax and consider the more classic hues in a different kind of mix,” said Leatrice Eiseman, executive director of the Pantone Color Institute. “The continuing challenge and goal will be in keeping the consumer visually engaged by blending the playful with the practical. To reach that destination, color is the compass.”
In its Nonchalance palette, Pantone is suggesting simplicity and casual ambiance in creating an attractive look.
“The reassuring colors coax a feeling of tranquility and relaxation with no suggestion of anxiety in the surroundings,” Eiseman said. “The comforting pastel pinks, ethereal blues and soft egret white wrap us in carefree baby blanket colors, harmoniously blending with the more mature taupe, gray and grape tones.”
One prediction for 2012: a glossy finish and color will be a magical coupling, drawing the eye and riveting attention.
“Metallic or glassy surfaces undulate and move and twist and turn, taking colors to new dimensions,” Eiseman said. “Turkish sea, blue moon, garnet, beluga, cloud dancer and the classic silver and gold will all be popular.”
Another palette worth noting: the colors of the Nouveau Neon set. Unlike the neons of the last 20 years, these exuberant shades bring a fresh new perspective to combinations.
“Asian-inspired bamboo yellow-green plays with orange, Popsicle and berry purples, while citrus colors toy with pink and raspberry,” Eiseman said. “A flavorful butter-rum tan is the unexpected accompaniment to all of the vibrant colors in the palette.”
Barb Schwartz, founder/chairwoman of the International Association of Home Staging Professionals, stresses the importance that the right color can add to attracting a buyer.
“Having the right colors can make a huge difference,” she said. “By following the latest trends and appealing to the buyer with colors that accentuate a room best, you can help connect someone with the house, making for an easier sale.”
The Indigo Effects palette evokes a mood of broad expansiveness and depth, which can help give a room an added appeal. The colors are variations on a blue theme—celestial and majestic blues, purple and deep blue indigos—all deftly brushed with contrasting strokes of maroon, mauve and moody gray.
For playrooms and children’s bedrooms, an effervescent palette called The Comics will be trendy in 2012.
“Funny paper hues pop off the page in whimsical ways that bring a smile and create the need to take some time to play,” Eiseman said. “Ominous phantom black provides the backdrop for sulphuric yellow and fiery red. A flash of green provokes a strong blue while an inky cyan plays up to honeysuckle and primrose. It’s quirky joy and spontaneity.”
For more interior painting trends, contact our office today.
October 6, 2011 12:09 pm
Our lead story in this month’s Home Matters, brought to you through our company's membership in RISMedia’s Real Estate Information Network (RREIN)® - Leading Companies Providing Leading Information – examines what colors are predicted to be the most popular when it comes to interior decorating as we approach the New Year. We also bring you some other timely pieces this month on selling vacant homes, incorporating fall décor as you prepare to list your home for sale, and more. As a benefit of our membership in RREIN, you will receive these relevant, powerful real estate articles each month that you’ll find timely and helpful in your real estate interests and pursuits. We hope you enjoy this month’s edition of Home Matters and as always, we welcome your feedback. Email us anytime!
October 5, 2011 10:57 pm
Sharing their location with retailers in order to receive discounts may be worth the privacy risk for the majority of mobile consumers. Sixty-seven percent somewhat/strongly agree that location-based coupons are very convenient and useful according to a recent mobile survey among smartphone and tablet users conducted by Prosper Mobile Insights™. Respondents answered questions directly on their mobile devices.
Further, one in four (25.6%) mobile users say they would prefer to receive coupons on a smartphone or tablet automatically when they are near a store. However, double that number (51.1%) would prefer to receive coupons on their device via email. Manually searching for coupons, scanning QR codes and receiving promotional texts/IMs also rank higher than automatic location-based coupons. Receiving discounts on the spot, though, appears more popular than “checking in” through social media (only 10.3% would prefer this method):
Coupon Preferences on Smartphones/Tablets
Receive via email: 51.1%
Manually search for them: 32.2%
Scan a QR code when inside a store: 31.9%
Receive via text or instant message: 31.0%
Receive automatically when near a store: 25.6%
Check-in through social media: 10.3%
Don’t want to receive coupons at all on device: 18.1%
While 81.9% are open to receiving coupons on their smartphone or tablet in one form or another, location-based coupons do raise privacy concerns—44.8% are somewhat/very concerned about their location being tracked or other security issues. 29.6% are neutral while 25.6% are not concerned.
The majority of Mobile Users engage in shopping behaviors on their smartphones or tablets. Most conduct research: 76.4% browse or look for a product or service; 73.0% use their device to locate a store or store hours; 48.9% research specific products; and 45.7% read customer reviews on their smartphone or tablet. Interestingly, 42.2% have used their smartphone or tablet as a coupon (scanning a bar code, showing a text to a cashier, etc.) Nearly two in five (39.7%) have also made a purchase directly on a mobile device and 36.2% have scanned a QR code.
For more information, visit: www.prospermobile.com.
October 5, 2011 10:57 pm
The home price picture for this year is shaping up to be a little better than it looked in June, according to the September 2011 home price expectations survey of 111 leading housing economists and experts sponsored by MacroMarkets LLC.
With just three months to go, the average prediction for the price decline this year from last year’s levels improved from a 3.52% price decline predicted by the experts in June to 2.53% in the latest survey. The survey is based upon the projected path of the S&P/Case-Shiller U.S. National Home Price Index over the coming five years.
However, longer term price prospects registered by the experts were less clear and varied widely, from a 19.2% increase by 2015 to a 5.7% decrease. The average prediction called for an average annual rate growth rate of only 1.1% through 2015.
“Relative to historical norms of average annual home price growth rates, the projected 1.1% nominal figure is dim, especially if broader inflation picks up (as many people think it will) within the coming five years,” says Terry Loebs, founder of Pulsenomics LLC, the firm that conducts the survey for MacroMarkets.
Loebs notes that the data still reveal a wide variety of individual views among panelists regarding a recovery in the U.S. housing market. Loebs says, “The erosion of price expectations in the face of record-low mortgage rates and the wide dispersion of views among many professional forecasters are symptoms of persistent dysfunction and imbalances in this country’s housing market.”
In the September survey, the panelists also offered their views of the likelihood, desirability and necessity for further government intervention in the U.S. housing and mortgage finance markets in the coming 12 months. Almost three-quarters (73%) of the respondents who shared a view think that further policy action is “highly likely” or “likely,” while more than half (57%) said such action is undesirable, and almost half (49%) said additional government action is unnecessary.
For more information, visit www.realestateeconomywatch.com.
October 5, 2011 10:57 pm
A stressful part of putting your home on the market is trying to figure out what to fix and upgrade to get the very best price. An experienced agent will recommend projects to consider and ones to avoid. After all, just because you put money into a renovation project doesn’t mean you will recoup the money in a sale.
Caprice Atwell, a REALTOR® from Florida, recommends consulting Remodeling Magazine’s annual “Cost vs. Value Report” for a breakdown of typical returns on renovation projects large and small. The 24th annual edition, published earlier this year, contains input from some of the country’s top remodeling professionals and ranked 35 remodeling projects for highest returns. In many cases, smaller-scale renovation projects recoup more of their initial cost than larger, pricier ones, according to the report. For example, a minor $20,000 kitchen upgrade returns 72.8% of renovation costs, but a more expensive $58,000 kitchen remodel only retains 68.7% of its value on resale.
Surprisingly, the report noted that exterior upgrades recoup more of their costs than interior renovations -- a trend that’s been building for the past five years. What’s the hottest exterior upgrade according to this year’s report? Replacing the front door with a steel entry door, which typically returns more than 100% of its cost.
The report also lists garage doors as a wise investment, returning up to 83% of their original cost when the home sells. Other prudent outdoor renovations include siding and window replacement, returning 80% and 72.4 %, respectively.
Interior improvements retaining the most value include attic renovations and basement remodels, recouping 72.2% and 70%.
“Just like an addition to the home, an unfinished space—such as the attic or basement—will instantly add value and livability to your home, as it increases the square footage and changes the way your family lives in it,” says Will Tomlinson, owner of a North Carolina-based renovation and remodeling company. “You will be transforming a space that likely gets very little use into a fully functional area for your family to enjoy.”
The report also notes that non-essential features have less resale value. Sunroom additions recoup only 48.6% of renovation costs; home office remodels, 45.8%; and backup power generators, 48.5%.
Of course, homeowners’ needs and budgets dictate their choice of home improvement projects. Still, it helps to know projects’ cost vs. return ratio when making the final decisions.