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May 15, 2014November 23, 2021

Picky home buyers and real estate slowdown

Why would a major real estate industry player predict a slowdown in home sales? The L.A. Times reported on May 5^th (Real estate giant predicts slow home sales for months to come) that Realogy Holdings Corp, the parent company of Coldwell Banker, Century 21 and Sotheby’s, claims that a slowdown in mid and low bracket homes could hurt the brokerage business and could prove to be a difficult 2014.

Meanwhile, a recent “Real-Time Seller Survey” conducted by Redfin (refin.com) indicated that 52.4% of home sellers were confident about selling their homes; however 40.9% of sellers were concerned about affording their next home. This may be why 40.3% of those surveyed planned to price their home above market value – maybe not the best strategy. The May 8^th Business Wire article (Redfin survey: 40% of home sellers plan to price higher than market value) quoted Redfin agent Paul Reid as saying; “Buyers this year are far less tolerant of overpricing, and homes that aren’t priced appropriately are likely to sit on the market until the seller is forced to reduce the price … Buyers often interpret a price drop as a sign there is something wrong with the home, leading some to negotiate even more aggressively or lose interest altogether.”

Economics aside, some experts say that a slowdown is in part due to institutional investors having all but left the market as distressed properties are decreasingly a part of the housing landscape; and the housing market is once again reliant on the owner occupant home buyer – who is often characterized as “picky.”

A lot has been said about “picky home buyers” since 2008, and the fact is that home buyers have not changed much – indeed, they may even be pickier today. It could be that the lessons of the financial crisis are still fresh in their minds; home buyers as group seem to be a hardy and savvy group. 2008 was a transition year, as home buyers shirked distressed properties for homes that exuded value. “Cheap” did not necessarily mean the home was a bargain to those who planned to be owner-occupants. Many home buyers were turned off to short sales and foreclosures, not just because of the process but because of the realization that the combined cost of the home purchase with repairs often exceeded the price of a re-sale that was in move-in condition.

Even though there is a perceived dearth of available homes for sale today, doesn’t mean that home buyers will pony up for an overpriced home. Home buyers are typically looking for a combination of location, quality, and value. According to Lyn Underwood (Home buyer turn-ons and turn-offs; McClatchy-Tribune Business News. April 26, 2014), home buyers are attracted to homes for a number of reasons; some of the top home characteristics include an updated kitchen with stone counters and maple cabinets; an open floor plan; new or refurbished wood floors; and flexible spaces (rooms that can be used for a number of uses).

If you’re selling this spring, don’t take home buyers for granted: don’t over price your home; and stay away from cheap renovations meant to look expensive (buyers are turned off by poor workmanship, sloppy installation, or inferior materials); and keep your home neat and tidy when showing. Your listing agent can provide guidance on preparing and pricing your home to sell in today’s market.

Original published at https://dankrell.com/blog/2014/05/15/picky-home-buyers-and-real-estate-slowdown/

Dan Krell ©
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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. This article was originally published the week of May 12, 2014 (Montgomery County Sentinel). Using this article without permission is a violation of copyright laws. Copyright © Dan Krell.

May 7, 2014September 29, 2019

Big brother is watching – surveillance cameras in home listings

Surveillance technology is everywhere these days; some are obvious and others covert. A growing awareness of government and law enforcement surveillance has become a major aspect of the growing debate of “reasonable expectation of privacy.” However, in a time when many are pushing back against surveillance, home sellers are increasingly turning to video cameras to protect their homes, valuables, and trust. And as the technology becomes cheaper and easier to use, the trend could become the norm.

The thought of the home seller remotely viewing your activity may seem creepy at some level; however, you might reconsider if you caught the recent ABC’s 20/20 segment “Caught on Tape: Real Estate Agents Gone Wild.” Highlighted were real estate agents who were caught on camera violating the trust of the seller; including: a Maryland real estate agent who was caught rummaging through a woman’s underwear drawer; the New Jersey agents who used their listing as a rendezvous point for sex; and a number of other agents caught stealing jewelry and prescription medicines from trusting home sellers. Real estate broker and author Brendon DeSimone, who was interviewed about how to protect your home during the listing period, suggested that the video camera can help you keep your agent honest; he stated: “just ‘cause they’ve done a lot of deals, it doesn’t mean they’re trustworthy.”

According to a Supercircuits.com infographic (The History of Video Security Cameras), the idea of “video monitoring” was first widely spread with the 1949 publication of George Orwell’s “1984.” Two years later, the first tape video recorder is operational. Since then, there have been mega leaps in technology making cameras smaller and easier to use. It wasn’t until 1992 when the “nanny cam” was introduced; before then, surveillance cameras were primarily used for law enforcement purposes and commercial applications. The “IP” enabled camera with onboard video analytics was introduced in 2005 as the internet technology and usage greatly expanded. Today, surveillance cameras can be placed almost anywhere and watched from any remote location.

Don’t get carried away with your voyeurism just yet; there are legal implications when using surveillance cameras, as well as possibly interfering with your negotiations. Rather than using the cameras for protection, there are some home sellers who are tempted to use the videos as a way of understanding the buyer by analyzing their gestures.

Does a home buyer have a reasonable expectation of privacy when viewing your home? After all, many sellers vacate the house so the buyer and their agent can view the home on their own; although sometimes they are escorted by the listing agent. Even though there has yet to be some ruling or professional opinion from a real estate board about the matter; an increasing number of home sellers are using obvious and observable cameras to monitor their homes. Aside from the “broker blooper reel” that was put together for 20/20, it seems as if the cameras have helped some home sellers go after rogue real estate agents.

For most people, a notice indicating they are being video recorded is enough to alter their behavior; sometimes a notice is enough to deter theft. However, there are some whose bad behavior is not deterred, even when looking directly at a camera. If you’re considering using surveillance cameras in your home during the listing period, you should consult an attorney about legal implications.

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By Dan Krell
Copyright © 2014

Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

May 1, 2014July 3, 2019

Squatters and real estate – a reality in today’s economy

Although some squatters move into vacant homes to live rent free, others do so to take advantage of adverse possession laws. The squatter movement has grown, not just in the U.S. but significantly in Europe as a means of social change. Activists advocate squatting as a response to Europe’s high unemployment, austerity, decreased public housing and declining living standards. Currently touted as “alternative housing,” squatting in the U.S. increased during the time when foreclosures and vacant homes skyrocketed after the financial crisis.

A recent story, about squatters taking over the Florida home of an active duty soldier who is stationed in Hawaii, highlights a recent trend. According to Florida’s WFLA Channel 8, the home owner claimed people broke into his home and changed the locks; however, the squatters who moved into the soldier’s home claimed to have a verbal agreement with the home’s caretaker to live in the home while making repairs. When the Afghanistan veteran planned to moved back to Florida, he was caught off guard when he was told removing the squatter was a civil matter and had to go through the eviction process to rid the home of the invaders. As the story gained national attention, veteran groups hired an attorney to begin eviction. However, it appears that the combined pressure has facilitated the squatters’ departure; but not without making a statement of their own by leaving the home in disarray and their dogs to roam freely.

Two local cases of squatting were reported last year, where defendants claimed “sovereign rights.” A vacant, bank owned Waldorf home was reported to be occupied by seven individuals who claimed to have the right to occupy the home because they are “sovereign citizens.”

A March 18, 2013 Washington Post article (‘Moorish American national’ charged with trying to take mansion) highlighted the other case, where an individual also claiming sovereign rights moved into a vacant $6 million Bethesda home listed for sale. The squatter allegedly attempted to change the tax records to indicate he was the owner by appearing at the Montgomery County court house and presenting “historical” documents and maps. But the county clerk turned him away saying that a “proper deed” was needed for such a change. The squatter reportedly went as far as emailing the listing agent cryptically claiming ownership. According to news reports, the squatters in both local cases were charged by police.

The Bethesda case emphasizes that bank owned foreclosures are not the only homes occupied by squatters, vacant homes listed for sale are also targets. Nationwide reports about squatters in upper bracket luxury homes increased last year, as well as the attention to “squatter’s rights” and adverse possession laws.

Last July, Sheree R. Curry of AOL Real Estate (Squatters Beware: States Are Revising Adverse Possession Laws) highlighted the case of a squatter who moved into a Boca Raton, FL mansion listed for sale. The squatter was eventually “locked out” of the home, but the events moved the community in an effort to change Florida’s Adverse Possession laws. And although adverse possession laws vary throughout the country, Curry reported that some states are revising these laws to protect home owners. New York and Washington had already changed adverse possession laws when Florida changed theirs to prohibit “acquiring title to real property by possession”; which went effect July 1^st 2013.

Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

April 24, 2014November 23, 2021

Preparations before you buy a home

So, you’ve been checking out homes online and have been bitten by the “bug.” You’ve patiently waited out the market and feel it’s time to jump in but not sure where to start. Whether you’re a seasoned or first time home buyer; don’t make the common mistake of overlooking the essential preliminary activities of the home buying process.

Experts agree that checking your credit report prior to starting the home buying process is essential. Your credit report is the basis for the credit score that is often used by mortgage lenders to decide if you qualify for a loan, and it may also be used as a means to decide your interest rate. If your credit report is inaccurate, it can cost you time and money.

Believe it or not, mistakes on credit reports are more common than you might think. According to the Consumer Financial Protection Bureau (CFPB), you’re entitled to a free annual credit report, which can be obtained for free from the “official” credit report website (annualcreditreport.com). The free report does not include a credit score, however, you can get it from the credit repositories for a fee; the CFPB cautions that the scores you receive may not be the same scores that lenders use for decisions on extending credit.

I often talk about doing due diligence, and many home buyers are attentive and thorough in negotiation, and home inspections; but many are not as careful when choosing their real estate agent and lender. Although buyers tend to work with the first or second agent they meet; there is a consensus that you should interview several real estate agents so as to know what to expect and to ensure you receive the service and attention you require. The same goes for any service provider you may use in the process, including the mortgage lender. And even though it has become more common for buyers to talk with several loan officers about mortgage programs and interest rates; however, it is recommended that you ask about lender fees as well.

Don’t be shy in choosing in choosing other service providers either – it’s going to be your home after all. Choosing a home inspector, pest inspector, and title company can take a little time, and it may seem easier to go with whomever your agent recommends; but sometimes price or proficiency is sacrificed for convenience. For example, a few moments of time to interview home inspectors can be the difference between having an adequate home inspection or a very thorough one.

Before you spend time visiting homes, it is highly recommended that you get qualified for a mortgage by a lender. An approval indicating that your income and asset documents and credit report were reviewed by the loan officer gives added credence to any purchase offer.

Don’t forget to make a housing budget. In addition to your mortgage payment, insurance, and property taxes, the budget should include utilities, maintenance and other expected expenses. The budget should also project increases in these payments as well. Rather than keeping to the maximum loan qualification, a realistic budget can reveal your comfort level on the price you’re willing to pay for a home.

Besides your real estate agent, more information about credit reports, mortgages and the home buying process is available from the CFPB (consumerfinance.gov) and HUD (hud.gov). With preparation, your home buying journey will be more enjoyable!

by Dan Krell ©
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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. This article was originally published the week of April 21, 2014 (Montgomery County Sentinel). Using this article without permission is a violation of copyright laws. Copyright © Dan Krell.

April 17, 2014December 13, 2022

Luxury real estate reaches new highs

Some of the most significant real estate sales of the year occurred in the last two weeks. The first is the home known as Fleur de Lys; Realtor.com reported on April 4^th that the Los Angeles mansion-estate that was described as “unsellable” – sold for LA record $102 Million. The home’s former owner was Suzanne Saperstein, socialite and philanthropist who’s seemingly public divorce from billionaire ex-husband David Saperstein appeared to capture the attention of the country when papers were filed in 2005.

Styled after Versailles, the 100 room mansion was originally listed in 2007 for a then record of $125 Million. However, the on and off again listing made some experts believe that the home would not fetch the asking price. But in the end, a bidding war ensued between several buyers, with the winner purchasing the home for the area record amount.

Although the sale of Fleur de Lys was news when it sold, it now takes a back seat to the highest priced publicly listed sale of a single family home in the country. Realtor.com reported on April 14^th that the Connecticut estate, Copper Beech Farm, sold for a record $120 Million. The home was the former residence of one of the founders of what would become U.S. Steel, and originally listed for $190 Million. The 15,000sf waterfront property is situated on 50 acres; and boasts luxury features such as: hand carved fireplaces; soaring ceilings (with intricate artwork); the dining room features columns, oak paneling, and a tracery ceiling; the solarium is lined in detailed glass.

Although the high priced home is touted for its record sale price, a July 2013 NY Times article (Burdened Estate Bears Monumental Price Tag, and Many Mortgages) reported that the most expensive home ever publicly listed for sale was also “one of the most heavily mortgaged homes in American history;” however, the article stated that the amounts owed were not of public record, and additional properties were reportedly sold to repay the loans.

This significant listing isn’t a pyramid, nor is it a house of cards. You might not even know that the former owner of this “butter-colored stucco house with the slate roof and second-story balustrades” was the infamous man for whom the financial scheme was named. Yes, Charles Ponzi’s home is listed for sale. Maybe the sale would have been significant on a number of levels if the home were listed 4-5 years ago; however, the stately colonial’s listing is still significant nonetheless.

The Boston Globe reported on April 4^th (Charles Ponzi’s former home up for Sale) that the Lexington MA home only changed owners three times since it was built in 1913; prior to the current listing, each sale was private. What makes this sale significant is that it is the first time the home’s sale is being listed publicly. Although the home was to be a symbol of Ponzi’s achievements and status; ironically, Ponzi’s ownership was only a six week stretch prior to his arrest in 1920. Maybe the new owner might be someone who is interested in the home’s history; however, the home is described as a “Colonial Revival mansion with 16 rooms and a charming 4 room carriage house…restored,” and of course hyped as the former residence of Charles Ponzi.

by Dan Krell
© 2014

Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. This article was originally published the week of April 14, 2014 (Montgomery County Sentinel). Using this article without permission is a violation of copyright laws. Copyright © Dan Krell.