Four Trends That Will Rock the Real Estate Industry in 2012

January 23, 2012 Leave a Comment

If there is one thing that I’ve learned in the real estate business over the years it’s that change is constant.  New tools, programs, regulations and innovators make this an industry that doesn’t stand still.

From computerization of Multiple Listing Service data to smart phones to mortgage preapprovals to digital signatures; innovation waits for no one.  You either embrace it or get out of the way.

So without further ado, here are my predictions for the upcoming year and some of the things that I believe will rock our industry (again):

1.  Listing Syndication and Internet Data Exchange (IDX) Will Come Under Fire

It has been commonplace over the last couple of years for companies and agents to syndicate their listings to as many real estate web sites as possible to increase the chance that their properties will get noticed by home buyers who will in turn contact an agent to buy a home.  Sounds like a plan – right?

Enter Edina Realty.  Edina is a mega broker with 60 real estate offices and over $5 billion in sales located in Minnesota, Wisconsin and North Dakota.  In late 2011, Edina stopped syndicating their listings to national websites.  Why would one of the top ten real estate companies in the US decide to shun syndication?  If you listen to them, there are three reasons: Read more of this post

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The Dawn of the New Normal

October 7, 2011 1 Comment

A brave new world is dawning

We’ve all heard the old adage, “The more things change, the more they stay the same.”  Well in real estate sales, you can take this cute little saying and bury it under a pile of dirt and lay an R.I.P placard on top of it.  Staying the same in this business is wishful thinking.

Consider the following five trends that are staring the average REALTOR® squarely in the face as we approach the end of 2011:

1.  Transaction Management – Never in the history of selling real estate has it become more important for the REALTOR® to stay closely involved in the transaction.  The days of writing the agreement and showing up at the settlement table to collect the commission are dead.  Between stringent inspections, mortgage approvals, title issues, appraisal valuations, complex documentation standards and increased buyer/seller expectations, agents need to hone their problem solving skills.  The most valuable sales professionals will be those that can manage this chaos.
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Dying on the Vine

October 6, 2011 2 Comments

It is more important than ever to select a real estate agent that not only knows what they’re doing, but also can guide a buyer and seller through the complexities of a real estate transaction.

A recent study by the National Association of REALTORS® hits home on this point.  In August of 2010, 9% of all purchase agreements for real estate never made it to the settlement table.  Now – fast forward one year – the percentage of contracts canceled has doubled!  That’s right; we now sit at 18%.  Not a pretty figure.

There are many reasons for the explosion of unfulfilled contracts: appraisal issues, increased scrutiny of borrowers by mortgage lenders, home inspection problems, complex contractual documentation and unrealistic expectations of both the buyer and the seller.

So if you are about to get involved with a real estate purchase or sale, do yourself a favor and secure the services of a competent, reliable real estate agent.  After all, you want to be one of the 82% that successfully ends up sitting at the settlement table.

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What’s Up with Mortgage Points?

July 5, 2011 Leave a Comment

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If William Shakespeare financed a home today he’d probably ask the question regarding mortgage points: “To pay or not to pay? That is the question.” Homebuyers direct the same question to their real estate agents. Here are some perspectives:

In its simplest definition, a point is an additional loan fee that is paid to the lender in exchange for a lower interest rate. It’s called “buying down,” and it allows you to reduce your rate for the life of the loan.

Let’s say you secured a mortgage loan for $150,000 without points, at 4.6% on a 30-year mortgage, your principal and interst payment would be $768.97 a month. If you paid two points ($3,000), the interest rate in this example may go down to 4.1% and the monthly payment would decrease to $724.80, a savings of $44.17 a month.

In this scenario, it would take you about eight years to recoup the money you paid up front, so if you are planning on staying in your home a while, this will save you money in the long-run.

Home buyers must answer some key questions to determine if paying points is a wise decision. Specifically: Read more of this post

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Spring Advertising Campaign Set to Kick-Off

March 6, 2011 Leave a Comment

Real people with a real message!  That’s the theme of these three television commercials that are starting to run on WGAL, Fox 43, WHP 21, Comcast and Viamedia.  They will run through the Spring buying season and end during the latter part of May.

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Hidden Benefits of Refinancing Your Mortgage

January 18, 2011 Leave a Comment

How much cash is in your home?So you’ve had your mortgage for a while and think you have a good rate.  Most people only consider refinancing if their present interest rate drops one percentage point – - – say from 6½% to 5½%.  But there are other good reasons to refinance your mortgage that will save you cash and make your life easier in the long run.  Consider the following:

1.  Dis-ARM yourself.  You may have obtained an Adjustable Rate Mortgage (ARM) when you first purchased your home and received an unbelievable rate.  You’re now probably experiencing the escalation part of the ARM which means your monthly payment is going from great to – - – hmmm - – - not so great.  Check into refinancing your loan so that you can lock in an interest rate and with it, obtain peace of mind knowing it won’t increase in the future.

2.  Eliminate Holiday Blues.  Are you like many Americans that went out and racked up credit card bills over the holidays?  If you’ve been in your home a couple of years you probably have an untapped resource in the equity sitting in your home.  Read more of this post

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The Difference Between Short Sales, Foreclosures and REO’s

September 8, 2010 2 Comments

  
Practitioners in the real estate industry sometimes throw around acronyms and terminology that we understand, but in many cases our clients do not.

Here is a prime example: short sales, foreclosures and REO’s (Real Estate Owned).  I found this short video clip that does a great job in explaining the differences.  The guy in the video is Spencer Rascoff, the COO of Zillow.

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Five Tips for Deciphering Your Home Loan’s Good-Faith Estimate

September 6, 2010 Leave a Comment

I recently had an agent in my office who showed me their Buyer’s HUD-1 Settlement Statement form two days prior to settlement that had some inconsistancies when it came to the numbers jiving with the original Good Faith Estimate provided by the lender.  I found this article of the National Association of REALTORS® consumer website, HouseLogic, that provided some good answers to questions about Good Faith Estimates.  The article is reproduced here in its entirety:

Knowing how to read your good-faith estimate can help you save money on your home loan.

When you’re shopping for a mortgage loan, it’s sometimes hard to understand the jargon lenders use in the good-faith estimate explaining the costs and fees you’ll pay when taking out a mortgage.

When you apply for a mortgage, the lender has three days to give you a good-faith estimate of the fees and interest rate you’ll pay, as well as other loan terms.  Here are five tips for using the new three-page form to your advantage.

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