Archive for January, 2009
Lifestyle Issues and House Buying
January 28th, 2009 categories: Real Estate
How to understand your buying psychology
The challenge of melding tastes and keeping peace is a real art and a good realtor can make the experience enjoyable. Helping clients analyze their styles will take deliberate communication between the buyers to determine what the basic, no negotiation necessities are for comfortable living. Keep in mind your lifestyle and activity level to help you decide if you want to pay the extra to live next to bike trails vs the convenience of being close to shopping. Thinking you’ll be happy in a particular neighborhood simply because it’s well regarded is a bad assumption especially if you find yourself compromising on your natural inclinations.
There are the usual assumptions of style for each sex (she likes large open kitchens, he wants room for his projects) but frustration arises when one person is totally in love with a particular house only to find out their mate wouldn’t even consider putting in an offer. I see this a lot when one party loves the floor plan because it reminds them of the house they grew up in but the other party can’t get past the style of siding on the exterior let alone what’s inside. Hammering out the details can be accomplished in a number of different ways but the point is to have that established as a baseline.
One tip for figuring out what works is to look at the basic personality types of the buyers. Are you a type A and your mate a type B? When I worked in interior design you could always tell the A’s…they were attracted to serene motifs, clean lines, calm colors. The type B’s on the other hand wanted energy from their homes so strong contrasts, lots of accessories and bold statements in furnishings caught their eye. Here’s an interesting link to an article on colors and personality types.
Translating all that into the home environment can help you understand why certain floor plans and styles are more attractive (notwithstanding basic design principles.) Trying to talk someone into liking something that their emotions dislike is like mixing water and oil but the result is a lot of frustration and short circuits the buying process. Taking the time to understand what you want from your home helps all parties and makes the process of buying much easier on your agent.
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What Is Your Home’s Value?
January 25th, 2009 categories: Folsom CA, Foreclosures, REO
Sacramento Valley Real Estate Market Trends
There’s this great website that a client of mine sent me that shows the market trends over the past 5 years in the Sacramento Valley. It’s put out by the Sacramento Bee and you can select any area and see how much the values have changed.
This past week at the Realtors board meeting there was a presentation complete with charts reflecting the decline of our market in relation to the loans people took out on their homes. The best part was that the numbers show that we’ve been through the first wave of loan re-sets and are starting the second which some say could be the last for this buyers market.
According to the recent stats the Sacramento area has dropped to values last seen in 2001. The Folsom area has been hovering around the 2003 price point which upholds the old adage of keeping location paramount. The percentage of bank owned homes in Folsom is about 63% compared to some areas which are close to 100%.
I recently had a conversation with an agent in the bay area where there have not been any fair market sales for the past 6months. According to DataQuick prices are down 50% there and we usually follow the bay area. The upshot is that the investors are starting to come back. It’s not unusual to hear of agents writing a dozen to 20 offers hoping to get 6 houses for their clients.
Right now we have low interest rates, plenty of property to choose from and little competition…sounds like a good time to go shopping. The real key is trying to guage when & where the bottom of the market will be. There are indications that this year will be the last decline and things will begin to level off but you need to remember that there won’t be anyone who will ring a bell to alert us.
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Now Is The Time To Renegotiate With Banks
January 12th, 2009 categories: Folsom Lake, Real Estate, Short Sales
Threat of judges interference encourage mortgage workouts
According to a news report from CNN Jan. 9,2009, Citibank has signed on with legislation to negotiate mortgage modifications with folks who have filed bankruptcy. It also says that the National Assoc. of Realtors is leaning towards supporting this piece of legislation which appears to be a complete 180 from previous statements. Allowing judges to renegotiate loans and reduce interest rates is some scary stuff.
My concern is the long term impact this type of “tinkering” with mortgages will have on the real estate industry as a whole. Referred to as a “cram-down” by the banking industry, this is something seldom used but according to this article (and my own experience) “the banks have been dragging their feet” in terms of negotiating with homeowners. It appears this offers the push back needed to get them to move the paper and get on the phone to the homeowners (and hopefully answer the phone calls from the Realtors!)
The real estate profession has long been used as a metaphor for unethical behavior but the lenders got caught in this past market and their true colors were displayed for all to see. I understand that mortgage brokers have to make a living and most are honest people who work for their clients best interests but we all know a story or two about the fast Eddie’s who got in and made a quick buck. Unfortunately it’s not those same people who have to take it in the shorts but at least this offers a solution to Joe the plumber to salvage his situation and get his loan reduced to keep his home. If the courts do indeed get the power to start reducing mortgages and alter the interest rates I think the industry as a whole will start to police it’s actions more closely and hopefully everyone will benefit.
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