A Seller’s Perspective
This is the second in a series of blogs regarding the purchase of real estate and is taken from the seller’s perspective. Real estate transactions are a complicated process and the need for a professional real estate agent is crucial to complete the transaction so all parties involved are satisfied with the outcome. Traditionally sellers are always represented by both real estate agents in a transaction. Obviously, the listing agent who has a signed legal document with all the responsibilities lined out represents the seller. What many buyers do not know is the agent who is finding and showing them properties is also legally responsible to the seller. But in the past several years a new type of representation has emerged with the buyer being exclusively represented by their agent. This type of representation is known as Buyer’s Agency.
From the seller’s perspective buyer's agency can eliminate any conflict of interest real estate agents may have when showing and negotiating for a buyer. The seller’s main focus is to sell their home or condo for the highest and best price which is the fiduciary responsibility of the listing agent. The main focus of a real estate agent acting as a buyer’s agent is to find and negotiate the sale for the buyer, representing their wants and wishes above all others. Sellers need to be careful about what they say, as well as their actions, when the buyer or their agent is present at showings. The seller needs to be aware that any information they may give the buyer’s agent can be conveyed to the buyer, which may or may not influence their price and terms when making an offer. Sellers also need to know that the buyer’s agent will most likely complete a Comparative Market Analysis (CMA) for the buyer which shows what similar properties have sold for in the area. The CMA is the basis for the buyer’s offer. This is where many times emotion enters the transaction and it is the job of both agents no matter who they represent to calm everyone down and present the facts to both parties. No one wants to complicate matters when as a buyer you may be making the most expensive investment you will ever make and as the seller you are trying to sell your home or condo and move on with your plans. From the seller’s perspective it is best to remember that as you are being represented, so is the buyer and both of you are trying to get the best deal possible.
iPad in Real Estate
Technology and real estate go hand in hand when it comes to efficiency in your job. There are so many things that agents can use that will not only make them cutting edge but they will perform faster with the convenience of the iPad. For real estate agents interested in getting an iPad to conduct business, it is important to know which applications are necessary to help you perform better at your job.
There are some free applications that you should download right away. The first application that is necessary for real estate agents to download and use is Zillow. Zillow gives you a home search and valuation. You can stroll through a neighborhood with the map feature. You should also download Cable XT. This is a side-by-side calculator and notepad. You are able to make quick calculations on a jumbo calculator and scribble notes in at the same time.
You will also want to download Keynote on your iPad. This is not a free application but a must-have for real estate agents. Whether you use a Mac or PC, you can load, create and share presentations on this application. Talk about “wowing” a client! No need for paper listing agreements and presentations with the DocuSign application. You can digitally sign any document anywhere with the advanced application for the iPad. Photogenie and/or Camerabag are two photo editing applications that offer a full suite of editing tools and also several filters and borders which make the picture all that more attractive. Pages is an application that allows you to make lists, start docs and compose articles. That way you can blog and organize your to-dos from virtually anywhere. Tweetdeck and Twitteriffic allow you to monitor keywords and people to stay current on the happenings around you.
Now that you have the applications on your iPad you need to run your business you can do many things on the fly. You can launch a listing presentation, preview property, provide clients a cleaner, greener listing presentation, share and save important documents and forms and much more. Your business will run smoother, be less stressful and at the same time, look super-professional.
Make the leap to the new technology and make your life much easier. Once you do this, you will never go back to the old way of doing things. It is just important to step out of your comfort zone and try something new that will help you and your career.
Technology in Real Estate
The world is ever changing and the technology is advancing right with it. As a client looking for a Real Estate agent to assist with their buying process, looking for a company with technology savvy agents is important when looking for properties. Why might this be you ask? Well let me rebound by asking, do you want your search to be the most efficient, smooth, quick and convenient process? When companies are up to par on technology and the agents know all of the advanced technology services that the client can benefit from, a win-win situation is created.
There are many services that the Multiple listing service offers, but many agents are not savvy in technology enough to utilize the services. One of the services that MLS offers is a transaction milestones feature. This allows the agent to not only add participants to the transaction, but it allows the agent to track all of the progress and have the participants be able to view the progress as well. The participants the agent may want to add would be the seller, the lender and the attorney for listing purposes. Once a listing has a contract on the property, the agent may want to add the buyer, buyers’ attorney, lender, appraiser, etc. The agent then will upload all documents and check off all the progress being made. This way, all of the participants are informed as to what is going on and everyone will be able to see the documents added. This allows for a smooth communication process.
The other bit of technology that the multiple listing service offers is called MRED fax plus. This system allows all the documents to be electronically stored and accessible anywhere. The entire real estate transaction process of passing paperwork back and forth between vendors’ can all be done electronically with this system. The system contains a cover letter that has a unique bar code on it. That barcode is a unique identifier that allows for any transaction being sent via fax or email to automatically go to the appropriate property folder that is created by an agent on the MRED fax plus system. This way the client can access all of the documents within that particular folder anywhere at any time. The vendors just have to make sure that anytime correspondence is being sent, that they have the cover letter attached with the unique barcode identifier.
These two systems are available to all agents, but most agents are not trained properly to be able to utilize it. If you are a client, looking for a property, make sure that you ask whether or not the agents utilize these systems so that your transaction process is fast, easy and convenient.
Condo Sales
The American dream of owning your own home has changed over the last couple of decades. The dream is still alive but the options have changed dramatically. One of the fastest growing segments of property sales today is condo sales. Owning a condo has many things in common with owning a traditional home, but it is the differences that count. It is important before you make that jump into home ownership that you know whether a traditional home or condo is right for you.
First of all, what is a condo? Condos resemble apartments in many ways. They can consist of several units in the same building or complex, with common areas like courtyards, lobbies, pools, etc. that are shared by everyone. But condos, as opposed to apartments are owned by the individual tenants and not just rented. When you purchase a condo you may be giving up some privileges but gaining in others. It is this balance of benefits that will be most helpful when deciding what type of property to buy.
One area that you need to investigate before you buy a condo is the prices of similar properties that have sold in the complex or complexes in the immediate area. Condo sales in the area can tell you if the price you are offering is too high or too low. A comparative analysis will also tell you how long units in that complex have been on the market, if prices have been reduced, how many units are for sale, and the prices in which they sold. With the ever changing real estate market it is important to be aware of all of these things to get the best value for your money.
Not all real estate agents are familiar with the nuances of condo sales. Real estate transactions are most likely the biggest financial investment most people will experience in their lifetime, so it is even more important to find the right person for the job. But how do you choose the right person for the job? First of all with most any financial transactions you will want to make a thorough search which can be done quite easily by attending open houses to see how agents work and to meet them first hand. Ask the prospective agent how long they have been licensed, how long they have worked in the condo market and how many sales they have closed in recent months. Ask for references and talk to your friends and family about who they would recommend and why. Once you have found the right agent you are well on your way to realizing the American dream of home ownership.
Existing Home Sales Rose Again in September
Existing-home sales rose again in September, affirming that a sales recovery has begun, according to the National Association of Realtors®.
Existing-home sales, which are completed transactions that include single-family, townhomes, condominiums and co-ops, jumped 10.0 percent to a seasonally adjusted annual rate of 4.53 million in September from a downwardly revised 4.12 million in August, but remain 19.1 percent below the 5.60 million-unit pace in September 2009 when first-time buyers were ramping up in advance of the initial deadline for the tax credit last November.
Lawrence Yun, NAR chief economist, said the housing market is in the early stages of recovery. “A housing recovery is taking place but will be choppy at times depending on the duration and impact of a foreclosure moratorium. But the overall direction should be a gradual rising trend in home sales with buyers responding to historically low mortgage interest rates and very favorable affordability conditions,” he said.
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to a record low 4.35 percent in September from 4.43 percent in August; the rate was 5.06 percent in September 2009.
The national median existing-home price2 for all housing types was $171,700 in September, which is 2.4 percent below a year ago. Distressed homes3 accounted for 35 percent of sales in September compared with 34 percent in August; they were 29 percent in September 2009.
NAR President Vicki Cox Golder said opportunities abound in the current market. “A decade ago, mortgage rates were almost double what they are today, and they’re about one-and-a-half percentage points lower than the peak of the housing boom in 2005,” she said. “In addition, home prices are running about 22 percent less than five years ago when they were bid up by the biggest housing rush on record.”
To illustrate the jump in housing affordability, the median monthly mortgage payment for a recently purchased home is several hundred dollars less than it was five years ago. “In fact, the median monthly mortgage payment in many areas is less than people are paying for rent,” Golder said.
Housing affordability conditions today are 60 percentage points higher than during the housing boom, so it has become a very strong buyers’ market, especially for families with long-term plans. “The savings today’s buyers are receiving are not a one-time benefit. Buyers with fixed-rate mortgages will save money every year they are living in their home – this is truly an example of how homeownership builds wealth over the long term,” Golder added.
As existing home sales rose again in September, total housing inventory at the end of the month fell 1.9 percent to 4.04 million existing homes available for sale, which represents a 10.7-month supply4 at the current sales pace, down from a 12.0-month supply in August. Raw unsold inventory is 11.7 percent below the record of 4.58 million in July 2008.
“Vacant homes and homes where mortgages have not been paid for an extended number of months need to be cleared from the market as quickly as possible, with a new set of buyers helping the recovery along a healthy path,” Yun said. “Inventory remains elevated and continues to favor buyers over sellers. A normal seasonal decline in inventory is expected through the upcoming months.”
A parallel NAR practitioner survey shows first-time buyers purchased 32 percent of homes in September, almost unchanged from 31 percent in August. Real estate investors were at an 18 percent market share in September, down from 21 percent in August; the balance of purchases were by repeat buyers. All-cash sales were at 29 percent in September compared with 28 percent in August.
Single-family home sales increased 10.0 percent to a seasonally adjusted annual rate of 3.97 million in September from a pace of 3.61 million in August, but are 19.5 percent below the 4.93 million level in September 2009. The median existing single-family home price was $172,600 in September, down 1.9 percent from a year ago.
Existing condominium and co-op sales rose 9.8 percent to a seasonally adjusted annual rate of 560,000 in September from 510,000 in August, but are 16.2 percent lower than the 668,000-unit level one year ago. The median existing condo price5 was $165,400 in September, down 6.2 percent from September 2009.
Regionally, existing-home sales in the Northeast increased 10.1 percent to an annual pace of 760,000 in September but are 20.8 percent below September 2009. The median price in the Northeast was $239,200, which is 1.4 percent below a year ago.
Existing-home sales in the Midwest jumped 14.5 percent in September to a level of 950,000 but are 26.4 percent below a year ago. The median price in the Midwest was $139,700, down 5.2 percent from September 2009.
In the South, existing-home sales rose 10.6 percent to an annual pace of 1.77 million in September but are 14.9 percent lower than September 2009. The median price in the South was $149,500, down 2.6 percent from a year ago.
Existing-home sales rose again September in the West increased 5.0 percent to an annual level of 1.05 million in September but are 16.7 percent below a year ago. The median price in the West was $213,600, which is 4.9 percent lower than September 2009.
