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6 Ways to Turn Off Any Buyer or Seller

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Trulia Pro BlogFor Real Estate Professionals
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buyer-turnoffs
Tara-Nicholle Nelson
February 6th, 2014

In the wild world of dating, when you encounter a ?turn-off,? you can just pack it in and not to go on another date with that guy or gal again. But turn-offs can be much more detrimental when they come up in the realm of your real estate.

Often times, your clients may inadvertently make big mistakes that can cost them big when it comes to securing their dream home or their dream offer. Indeed, turn a buyer off, and your seller?s may risk low offers or?worse?a home that just won?t sell. The same goes for buyers. In today?s market, multiple offers are common. And even in cases when your client is the only buyer on the scene, having a cooperative seller goes a long way toward everything from getting access to the place for inspections to getting a price reduction when the appraisal comes in low. Thus, the potential exists for buyers to turn sellers off, and risk having their dream home slip right through their fingers.

As your clients proceed toward their quest for a drama-free home journey, it?s your job to stop them from making these far-too-common mistakes and help them snag the best buyers and sellers to help their real estate dreams become a reality.

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6 Horrible House Hunting Pitfalls to Help Buyers Avoid house-hunting

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Trulia Staff
June 5th, 2014

Sometimes it?s not the market or their agent (we know, we know) that stops buyers from snagging their dream home. And despite their good intentions, sometimes buyers unknowingly self-sabotage their home search. Which got us thinking: As agents, what can we tell buyers from the get-go that can help them avoid some of the worst house hunting pitfalls?

We reached out to Arron Sweeney, founder of Your Berkeley and realtor at King Realty Group in San Francisco, as well as Lance King, broker and owner of King Realty Group. They shared six home buying hang-ups and what agents can say to clients to help them avoid these common missteps.

Love these tips? Get the printable handout to share with current and prospective clients!

1. Missing out on the perfect place.
Hundreds of new homes hit the market every day, and buyers who are not using all of the house hunting tools available, could let their dream home could slip by unnoticed ?or worse, someone else might snatch it up before they even know that it?s for sale. One of the toughest lessons for a first-time (and, yes, even a second-time) buyer is that in this market, passive house hunting simply will not cut it. No matter what we agents do?and no matter how many e-mails we send showcasing a just listed property that agents would love to show our clients?if the buyer doesn?t make house hunting a top priority, it?s going to be a painful process.

What Agents Can Do:
As soon as you secure your newest buyer clients, set up a time to discuss your house hunting strategy. Ask them what their preferred method of contact is when there is a home that just can?t wait to be seen. Leverage smart free tools like Trulia?s Nearby Home Alerts come in handy. Buyers get an instant notification on their mobile device when new listings near their current location come on the market. Setting up such a strategy will let buyers stress less and think more about window treatments than missing their window of opportunity.

2. Choosing the wrong lender.
Few things are more frustrating (for buyers and agents alike!) than finding the perfect property only to find out that the loan isn?t coming through.

What Agents Can Do:
?We always tell our clients to use our preferred lenders because they?ll get great rates, the VIP treatment, and if there?s a problem they?ll find out on the front end,? says Sweeney. Remind clients that preferred lenders earn their preferred status only after they?ve consistently delivered loan closings. Provide them with a list of preferred lenders, and provide clients with educational materials to help them get their loan situation in order before they hit on their must-have property.

3. Fixating on price per square foot.
Buyers who search by price per square foot may be prime for some major disappointment.

What Agents Can Do:
King suggests reiterating to clients that if they are using this as one of their search criteria, they might want to think again. Measurements, as agents know, are not guaranteed to be accurate, and mis-measurements can place appropriately priced homes outside of a client?s search parameters.

4. Desperation.
When prices are on the rise, buyers get antsy and sellers get greedy. ?Many buyers have been outbid on numerous properties and have just become tired of looking,? says Sweeney. ?As a result, they are placing ridiculously high offers on properties that just aren?t worth it?just to get into a home this minute.?

What Agents Can Do:
Tell buyers to avoid the temptation and work with them to build up a backup plan. Suggest neighborhood or areas that may actually have the right home at the right price that the buyer potentially crossed-off the list due to superficial reasons. Make it a gentle conversation. ?Why don?t we just spend an afternoon looking at a few properties to see what?s out there? You don?t have to commit to changing your home search, and you?re not tied into anything. This is just a little bit of an exploration.? And, if all else fails, recommend short-term or corporate rentals options, so they?ll have a soft place to land while they wait for their dream home to appear on the market. When that happens, you?ll be the agent they come running back to.

5. Foregoing inspections.
In a perfect world, sellers would disclose every single issue to the prospective buyers. Since that?s not the case, inspections are a great idea; yet one that Sweeney sees clients skipping too often.

What Agents Can Do:
?I have a strong knowledge of construction and always advise my clients to pony up and have both an independent pest and contractor inspection,? says Sweeney. Inspections identify red flags and can address the general state of a property. Plus, they can provide leverage when it comes time to negotiate. Discuss these issues in details with your clients, and remind them of how much neglecting inspections may cost them in the long run.

6. Buying a ?project.?
The unwritten rule of renovating states that it will take more time and money than expected. So it?s important for buyers to know their threshold for renovations before buying a fixer-upper.
What Agents Can Do:
Be prepared to share referrals to general contractors and specialty tradesmen. It doesn?t hurt to schedule a showing with one of these pros in tow either. It?s better for clients to know what they?re getting into before they find themselves in over their head. Plus, a happy new homeowner is the source of a great recommendation and referral clients for years to come.

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Setting the Record Straight: Top Home Buying Myths

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The Real Estate Book
Original Post by Courtney Soinski

Whether you?re a real estate professional or first-time home buyer, the home buying process and real estate transactions can be stressful. There tends to be some common misconceptions in this process, so it?s very important that you?re well informed of what is fact and what is fiction. We?re here to set the record straight.

Whether you?re a real estate professional or first-time home buyer, the home buying process and real estate transactions can be stressful. There tends to be some common misconceptions in this process, so it?s very important that you?re well informed of what is fact and what is fiction. We?re here to set the record straight.

Myth #1: You don?t need a REALTOR?.
Before you bravely take on one of the biggest purchases or sales of your life, remember this: it?s not as easy as it looks. REALTORS? know all the ins and outs of the local area as well as the market in which you?re looking to buy or sell. Picking up the phone and calling a REALTOR? may be one of the best decisions you?ll make.

Myth #2: The bigger the downpayment, the better off you?ll be.
Buyers? immediate reflex is to put as much cash down as they can when buying a new home because they?ll borrow less, lower the monthly mortgage payments, and won?t need to buy mortgage insurance. However, putting 20% down is not a requirement and it?s not for everyone.
Thanks to Federal Housing Administration Loans (FHA Loans), you can put as little as 3.5% down. With this method, you?ll potentially have a lower interest rate, giving you more flexibility. Your money is not all tied up in your house like in a traditional down payment that can leave you with little or no extra cash to spend on home care, improvements, or any other unforeseen circumstances.

Myth #3: Appraisers set the value of a home.
The role of the appraiser is to produce a credible opinion of value that reflects the current market. Appraisers are not responsible for setting the value of the home and they also do not confirm a home?s sale price. According to David S. Bunton, President of The Appraisal Foundation, ?Appraisers provide an analysis of the collateral, so that lenders understand the value of a property when making the loan decision.?

Myth #4: You need perfect credit.
Most people assume that you must have absolutely golden credit in order to get a loan, but that just simply isn?t the case. If buyers have less than perfect credit, lenders are often willing to work with them to get the best possible loan.
Credit is not the only thing that lenders look at when deciding to approve a loan, but your score will have an effect on the interest rate on your mortgage. Make sure you review your credit report and if any errors are found, they should be reported to the credit reporting bureaus before applying for a mortgage.

Looking to buy? Best cities for first-time home buyers

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Reality Check
Edited by Diana Olic | @diana_olick

In the rush to get in on the bargains of the housing crash, first-time home buyers were largely left out. Investors swarmed the most distressed markets, spreading their cash like fertilizer and pushing home prices up far faster than most expected. In less distressed markets, first-time buyers were still hampered, as the pendulum swung hard from loose lending to too-tight credit.

Now, as the spring season brings more listings to the national market and as investors seem to be pulling back a bit, first-time buyers are testing the water again. Some markets, like San Francisco, will likely be cost-prohibitive, while others, like Philadelphia, could offer easier entry to home ownership.

“First-time home buyers were put at a disadvantage against all-cash buyers, but with interest rates still staying low, with the marketplaces having risen fairly decently, you’re seeing the opportunity where it’s less of an investment for investors but a good opportunity for first-time home buyers,” said Steve Berkowitz, CEO of Move Inc. operator of Realtor.com.

Houses are about to get really, really smart

Realtor.com ranked the top 10 markets for first-time buyers, using five factors to judge the best: market popularity, prices, inventory, time on market and employment. Pittsburgh, Tampa, Fla., and Philadelphia, ranked highest, mostly because their prices have not spiked much and their unemployment rates are lower than the national average.

Interestingly, Phoenix also made the top 10. Phoenix was one of the hardest hit housing markets during the crash, with prices literally falling by more than half from peak to trough. Investors targeted the market early, buying thousands of distressed properties at deep discounts and driving prices up by double-digits very quickly. Still, Berkowitz said it’s a great place for first-time buyers now.

How we will live: More green, more urban, more efficient

“Investors are looking for a certain level of return,” he said, and they’re not getting it in Phoenix anymore. Large-scale investors have moved on to other markets, like Atlanta and Chicago, where discounts are better.

Click to View Video “Hey First Time Buyers, Here are the Best Housing Markets”

Realtor.com released a list of the top markets for the first time home buyer. CNBC’s Diana Olick reports this is a crucial segment of the industry.

Click to View the Video “Where First Time Homebuyers Are” Video

Top 10 Markets for First-Time Home Buyers by Rank
Realtor.com

realtor com best places to live 2014

Getting a mortgage is easier, but only just

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New programs open options for borrowers

Housingwire.com article

greenhouse

Mortgage credit continued to trend higher in February, following a steady increase in availability since November 2013, the latest report from the Mortgage Bankers Association revealed.

The mortgage credit availability index edged higher 0.44% to 113.5 in February from 113 in January.

If the MCAI had been tracked in 2007, it would have sat around 800. The index was benchmarked to 100 in March 2012.

“For the third month in a row, mortgage lenders and investors slightly expanded credit offerings in February on net, as a result of offsetting factors,? said Mike Fratantoni, MBA?s chief economist.

“Specifically, the recently implemented QM/ATR sections of the new Consumer Financial Protection Bureau regulations stipulate that ARM loans must qualify at the highest allowable rate for the first five years of the loan,? he continued.

Because of this, many investors have discontinued loans whose interest rate adjusts after only 3 year (also known as 3/1 ARMS).

But despite the pull back in the 3/1 programs, lenders and investors added several new 5+ year ARM programs, including those for Jumbo loans, to their repertoire resulting in a net increase to the MCAI, Fratantoni explained.

Brena Swanson
Brena Swanson joined the HousingWire news team in February 2013.
Prior to serving HW in the role as Reporter and Content Specialist,
Brena attended Evangel University in Springfield, MO.

Mortgages, Housing Starts & New Household Creations in 2014 ? What You Need to Know.

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The Real Estate Book Blog
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Over the past year, there has been a revival of single-family home production. What does this mean for 2014? Housing will continue its climb toward higher ground this year, but builders are still confronting several challenges, according to economists speaking at the National Association of Home Builders (NAHB) International Builders? Show (IBS).
NAHB Chief Economist David Crowe explains that consumer confidence has returned to pre-recession levels and household balance sheets are on the mend. Year-over-year household formations are on the rise and now averaging 620,000 compared to just 500,000 during the housing downturn.
At the height of the housing boom, the U.S. was producing 1.4 million additional households each year. Meanwhile, new-home sales are averaging just 8.7 percent of total home sales?barely half the historical average of 16.1 percent. However, builders still face several headwinds, including rising building material prices, persistently tight mortgage credit conditions, difficulties in obtaining accurate appraisals and limited availability in labor and developed lots.

NAHB forecast for 2014:
? 1.15 million total housing starts in 2014, up 24.5 percent from 2013?s 928,000 units.
? Single-family production projected to rise 32 percent to 822,000 units and surge an additional 41 percent to 1.16 million units in 2015.
? 333,000 multifamily starts, up 9 percent from 306,000 in 2013.
? Single-family home sales are projected to hit 584,000 this year, a 35.9 percent increase above last year?s 430,000 sales.
? Residential remodeling activity is expected to register a modest gain this year over 2013.
? A slow and steady housing recovery will bring nationwide housing starts to 71 percent of normal by fourth quarter 2014 and 93 percent of normal by the end of 2015, says Crowe.
? On a state level, the top 20 percent of states will be back to normal production levels by the end of 2015, compared to the bottom 20 percent, which will still be below 84 percent.

Mortgage rates up, but housing still affordable
As the economy strengthens and the Federal Reserve tapers its buy-back of mortgage-backed securities, there will be upward pressure on mortgage rates, but not enough to harm housing affordability, according to Frank Nothaft, vice president and chief economist at Freddie Mac.
Nationally, Nothaft expects that home sales and prices will each rise about 5 percent in 2014, and that housing starts will post a 20 percent gain.
?As we move into the 2014 home buying season, it will be a market dominated by home buying originations rather than refinance originations,? says Nothaft. ?This will be the first time since 2000 that purchase originations will dominate the market.?
He says the reason for the change is because so many households looking to refinance have already done so, and as mortgage rates gradually rise, fewer homeowners will look to refinance. Further, purchase originations are expected to increase as the overall housing market strengthens.

Pent-up demand will fuel growth
In the aftermath of the Great Recession, there is a significant pent-up demand to form households and even to build homes.
At least 3 million fewer households formed over the past five years than would normally have been expected. During this period, many college graduates were forced to double-up or move in with their parents. Stronger job growth and a strengthening economy in 2014 should lead to a rise in household formations, which will be important to supplement housing demand.
?I think this will be a pretty good year for home construction,? says Real Estate Expert and Economist David Berson. ?There will be a big increase in single-family construction, but not as much for multifamily.?
For more information, visit www.nahb.org.

The Real Estate Book Original Post

New Survey Reveals Pulse of 2014 Spring Real Estate Market

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RISMedia Post
spring_real_estate
A recently released survey indicates a lively Spring season ahead for real estate sales. MRIS, a Mid-Atlantic Multiple Listing Service (MLS), recently released the results from its 2014 Spring Real Estate Outlook Survey.

The survey drew responses from over 1,300 real estate professionals within MRIS’s geographic footprint, including Washington D.C., Baltimore, Northern Virginia, and parts of West Virginia and Pennsylvania, focusing on their predictions for the Spring market.

Over 71 percent of MRIS real estate professionals are more optimistic about the upcoming real estate season compared to last year and predicted transactions would increase this year from 2013. Additionally, 82 percent of respondents think the average home sales price will increase in this year’s Spring market.

The survey also looked at the homebuyer and seller challenges, inventory and new mortgage rules.

Homebuyers and Sellers
Forty-five percent of MRIS real estate professionals predict that 2014 will continue to be a seller’s market, while 33 percent indicated a buyer’s market for this year and 22 percent are unsure.

“The DC Metro market has been, without question, a seller’s market and will most likely remain so,” Strauch added. “In 2013, we saw two months of supply on average, meaning it would take two months for all homes on the market to sell and we expect to see that continue. The Baltimore Metro area is more balanced, but still favors the seller to some degree with its 4.9 months of supply.

According to the survey, other challenges that buyers and sellers will face this Spring season include:

  • Approximately 53 percent of respondents think that an insufficient supply of homes on the market is one of the biggest challenges that buyers face right now.
  • Fifty percent of those surveyed feel buyers were concerned with competition from other buyers; and 48 percent noted low affordability.
  • Over half of the respondents believe that the biggest challenge that sellers are facing right now is pricing their home properly.

Inventory
Thirty-seven percent of respondents believe that inventory will increase compared to last year and just slightly less (32 percent) indicated inventory will be about the same as last year. Only 22 percent of real estate professionals predict that inventory will meet the demand they expect for 2014.

“Demand is highest for the more affordable price points, which leads to higher competition among condos and townhomes in our region,” says Strauch. “Baltimore and DC Metro’s low supply of attached homes gives seller’s the advantage in our market. Detached homes have a more balanced market and, in some areas, possibly even lean towards the favor of the buyer due to less competition.”

  • Fifty-eight percent responded that the biggest shortage of supply would be homes priced below $300,000; and 29 percent says the largest shortage would be homes in the $300,000-500,000 price range.
  • Approximately 48 percent of real estate professionals predict that attached houses in Spring 2014 will remain the same level of sales seen during 2013.
  • Approximately 21 percent reported that attached houses would rise in popularity over single-family detached homes this year.

New Ability to Repay and Qualified Mortgage Rules
In early January new mortgage rules issued by the Consumer Financial Protection Bureau went into effect, designed to lower the risk of defaults and foreclosures among borrowers. As a part of the rules, lenders must determine that a borrower has the income and assets to afford to make payments during the life of the loan.

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Buying A Home Is Now 38% Cheaper Than Renting

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Buying A Home Is Now 38% Cheaper Than Renting
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Is renting or buying a better financial bet? Every six months, Trulia?s chief economist Jed Kolko runs the numbers to answer that question and help you stay on top of the trends. So what does Trulia?s Winter 2014 Rent vs. Buy Report tell us? Although the gap between renting and buying is narrowing across the U.S., homeownership is still 38% cheaper than renting.

Homeownership remains cheaper than renting nationally and in all of the 100 largest metro areas according to Trulia TRLA -5.5%?s latest Winter Rent vs. Buy report. Rising mortgage rates and home prices have narrowed the gap over the past year, though rates have recently dropped and price gains are slowing. Now, at a 30-year fixed rate of 4.5%, buying is 38% cheaper than renting nationally, versus being 44% cheaper one year ago.

rentvsbuy3

The rent versus buy math is different in each local market. Buying ranges from being just 5% cheaper than renting in Honolulu to being 66% cheaper than renting in Detroit. But even for a specific market, the cost of buying versus renting depends on how much home prices rise (or fall) after you buy. Our model assumes conservative home price appreciation, but ? as we all know after the last decade ? home prices can unexpectedly rocket or plummet.

rentvsbuy1

Buying Beats Renting Until Mortgage Rates Hit 10.6%

Even though prices increased sharply in many markets over the past year, low mortgage rates have kept homeownership from becoming more expensive than renting. Also, in some markets, like San Francisco and Seattle, rents have risen sharply; rising rents hurt affordability relative to incomes, but rising rents make buying look cheaper in comparison.

Will renting become cheaper than buying soon? Some markets might tip in favor of renting this year as prices continue to rise faster than rents and if ? as most economists expect ? mortgage rates rise, due both to the strengthening economy and Fed tapering. For each metro, we identified the mortgage rate ?tipping point? at which renting becomes cheaper than buying, given current prices and rents. If rates rise, Honolulu would become the first metro to tip, at a mortgage rate of 5.0%. San Jose and San Francisco would also tip before rates reach 6%. But those are the extreme markets. Nationally, rates would have to rise to 10.6% for renting to be cheaper than buying ? and rates haven?t been that high since 1989.

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Bad Staging Decisions (And What to Do About Them)

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Original Posting by Trulia Pro Blog
WRITTEN BY
Tara-Nicholle Nelson
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8 Shockingly Bad Staging Decisions (And What to Do About Them)
Real estate is an intensely personal experience for many buyers and sellers. After all, a home, at its core, is a personal expression of a homeowner?s entire life wrapped inside four small (okay, sometimes not so small) walls.

And while, ultimately, buyers should be more focused on the bones of the home?the things that will stay after the current owner has vacated?staging can often be the difference between a buyer bonanza and a dearth of hot offers. Don?t let your sellers suffer at the hands of poor staging.

It may be challenging, but a little tough love now, will make for a love fest post-sale?after the big offers come flying in. Here are 8 of the biggest staging sins sellers make and how agents can help their sellers avoid these pitfalls before it costs them a sweet deal.

1. Collection Overload.
It is very difficult for almost any collection to look orderly and neutral, two high-level aims of home staging. Unless the homeowner has attractive, high-end built-in cases to house the collections and the target buyers share a similar affinity for the objects, even the coolest collection can come off as a pile of space-consuming clutter.

When it comes to shockingly bad staging decisions, the choice to give a taxidermy or gun collection a starring role in a home?s staging is high in the oh-so-bad rankings. For some buyers, these collections can trigger ethical and sanitation and can distract from the strengths and features the property has to offer.

What to Tell Your Seller:

Remember that uber-personal thing we talked about earlier? Collections are often a source of pride or hold sentimental value. Tread lightly. Let your seller know that while you appreciate the collection, their home sale will benefit from a more neutral, less-personal aesthetic. You may also want to mention that open houses mean many people in and out of the seller?s home. All prized possessions should be stored ahead of time.

2. Echo-Chamber Staging.
In an echo chamber, sounds are amplified because they simply bounce around in that closed space. When left alone, the same thing can happen to sellers if they do not have outside input. And unfortunately, it seems to be the bad staging ideas that get amplified, more than the good ones. Echo chamber staging happens when the sum total of a staging team, well, one person. That bold wallpaper in the bathroom may seem like a good idea, but a little perspective?and another opinion?may prove otherwise.

What to Tell Your Sellers:

The truth can hurt?but backing into your argument can take some of the sting out of the professional staging talk. Sellers who stage with zero external or professional input, are often the sellers who are unable to see:

that their homes are still significantly cluttered or over-full,
that their furniture is too plentiful and too large to show how spacious the home truly is, or
that their sweet feline companions are also rather malodorous to strangers.
Take a little staging field trip with your sellers. Take them to one home with tasteful bring-in-the-buyers staging and another to a home with cover-your-eyes-bad d?cor. It can be tough to self assess, but once you show your sellers what a big difference a little staging makes, they may be more open to the suggestion. If your clients have a bare-bones budget, see if they?ll hire a pro stager for just an hour?s worth of advice.

3. Failure to edit.
You?ve heard thirty-somethings who still live at home diagnosed with failure to launch? Well, failure to edit is a close cousin of this syndrome. As the New York Times recently put it, ?the job of stagers is to reverse the accumulated creep of hundreds of small and misguided design decisions, and to erase any hints of the messiness of daily life.? Your client might have a fantastic rug, a beautiful sofa, amazing tchotchkes and the highest-end personal effects, but chances are good that their cumulative first impression to a buyer viewing the home will still fall short of the ?one broad stroke of gorgeousness? the Times piece correctly says home sellers should aim for, with their staging.

The failure to edit is a generalized syndrome which can manifest in all sorts of specific staging woes, from garden variety clutter to disastrous decor style mash-ups.

What to Tell Your Sellers:

Edit, edit, edit. Then go back and edit again. Sellers should think of de-cluttering as pre-packing. If your client is a DIY stager, tell them to ask their friends to come in and help decide what still needs to go, once they think they?re done removing furniture and personal effects. A sassy best friend or a nit-picky sister-in-law can sometimes be an agent?s best friend.

4. Silly scenarios.
The difference between staging and interior design is simple: staging is cost-and-time efficient design undertaken with the specific objective of showing a home off to its best advantage, playing up its features and helping prospective buyers visualize the best lives they could possibly live in the home, should they choose it. Unfortunately, this has led some well-intentioned sellers and stagers to believe they should stage one bedroom as a Parisian boulevard (Eiffel tower mural included), another with a full-blown butterfly theme and the third as the beach?complete with umbrella, towels on the wall and sunscreen bottles on the nightstand. I saw this house, folks. With my own two eyes.

What to Tell Your Sellers:

Be firm. Let sellers know that they should stage their home to show off its space, light and conveniences, and the best, basic purposes that unusually small or large spaces could be used for. If the backyard is a huge selling point, stage it with outdoor dining or living room furnishings. Similarly, if the home is a two-bedroom with a bonus room in an area of four-bedroom homes, staging the bonus room as a bedroom or home office helps buyers understand the solutions that can minimize the brunt of your home?s challenges.

Staging your home to create ?cute? scenarios with no relationship to the selling points or solutions buyers care about is of no value and can create a low-budget feel.

5. The ?lived-in? look.
When a home is being shown for sale, it must be immaculate, every single time it?s being shown. It should look like no one lives there: no toothbrushes, curling irons, protein shake mixes or paperwork allowed.

Is this difficult to keep up? Absolutely. But you?d be surprised at how bad an impression just a few personal toiletries or dishes can make.

What to Tell Your Sellers:

Work closely with your sellers so that they understand the importance of a flawless showing. Encourage your clients to set up a system for putting everything away and wiping down all kitchens, bathrooms and other daily mess hot spots every single time the home is going to be shown.

6. Closet cramming.
Out of sight is not out of mind. Home buyers today are desperate for storage space and will undoubtedly open those same, crammed-tight doors in an effort to evaluate how the home ranks for storage. Beautifully organized closets with ample room create an impression in the buyer?s mind that they, too, can have an orderly life in the home.

What to Tell Your Sellers

Encourage sellers to see the exercise of staging as an opportunity to sell, donate or throw out things they no longer need. Remind them that even huge closets, if crammed to the gills, make buyers wonder how they?ll ever get by with so little closet space.

7. Failing to stage for all the senses.
A house that smells like pet mayhem or smoke or has a noisily defective heater is a tough house to sell, no matter how beautifully it is staged. Unfortunately, smells and sounds are very easy to get acclimated to, when you live with them. Buyers, though, will detect them the second they walk in?and the moment they do is the moment we in the business call ?turn-off time.?

What to Tell Your Sellers:

It may be uncomfortable?but honest is the best policy. Be gentle and sensitive (?musky? comes across softer than ?moldy, dank, and gross?). Offer to work with them to fix it or refer them to a trusted vendor who can.

8. Not to.
Ultimately, the most shockingly bad of all staging decisions is the surprisingly frequent decision not to bother staging the home at all. This explains homes like the one I once viewed which had residents still sound asleep in their beds, in the dining room, as the listing agent walked myself and my mortified buyer clients through the property. On the less bizarre end of the non-staged spectrum, this is how lovely homes with vast potential end up selling at a discount, as cosmetic fixers at a discount. This is a particular tragedy in cases where the owners could have painted, spruced, moved loads of things out and a few newer things in and made much, much more money on their homes

What to Tell Your Sellers:

Ask them what about staging feels off-putting. If it?s a budgetary concern, focus on de-cluttering and small accents or paint, which can make a big difference on a dime. If the issue is?you guessed it?a little more personal, remember that showing can sometimes be more effective than telling.

NEW LOAN REQUIREMENTS FOR GETTING A MORTGAGE

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Written by Phoebe Chongchua on Monday, 06 January 2014 8:44 am

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The number of homes purchased with a home loan has been dropping steadily since May, according to RealtyTrac. Instead, cash is king for many reasons. As mortgage rates began creeping up, some homebuyers started opting to purchase with all cash. And that trend may continue as new loan requirements become more strict.

However, for those buyers who do need to purchase a home with a loan, expect to see some changes in the loan requirements as the new year rings in. Here are a just a few of the changes that are going into effect in January 2014. Some of these requirements are already in place by lenders.

The new guidelines are being implemented under The Consumer Financial Protection Bureau’s Qualified Mortgage (QM) and are designed to help avoid the borrowing catastrophes that caused the housing crisis. The guidelines are what the lenders use to prove borrowers’ ability to repay a loan.

One of the guidelines? requirements is that borrowers must have a maximum debt-to-income ratio of 43 percent. Debt-to-income ratios have already been in place but the new rules won’t allow for any compensating circumstances. That means that not even a significant downpayment or a large cash reserve will be allowed to offset a higher debt ratio.

The incentive to follow these guidelines is huge for the lender. If the mortgages don’t meet the QM guidelines, the lender will be required to hold the loan as opposed to selling it to Fannie Mae and Freddie Mac.

The QM requirements potentially may have lower loan limits for conventional conforming loans. The agency that regulates Fannie Mae and Freddie Mac, The Federal Housing Finance Agency, will delay its normal adjustment of loan limits from January 1, 2014 to sometime later in the year. The agency is trying to see what kind of impact the new QM guidelines will have on the housing industry. For most housing markets, the current limits are $417,000 and up to $625,000 in high-cost areas. How these figures will change remains to be seen in 2014.

Origination fees will be limited under the QM requirements, which could make getting a smaller loan more difficult. Origination loan fees will be limited to no more than 3 percent of the loan amount. This could make mortgage lenders less likely to offer smaller loan amounts because they may not always be able to recoup their costs and make a profit.

Self-employed borrowers already face tough standards and they’ll likely be even more strict in 2014. In the QM guidelines, all borrowers must prove there is sufficient cash flow to make payments on their loan but self-employed borrowers’ incomes typically fluctuate. These borrowers frequently have cash reserves that they rely on to pay bills when their income is off in a particular month. However, even if there is a large amount of money in reserve, it may still be difficult for the self-employed borrower to get a loan approved due to this new “ability-to-repay” QM guideline.

Expect to see changes in the loan approval process as the new year begins. However, some of the specific requirements may not be determined until later in 2014.

Read Original Post – RealtyTimes.com

Real Estate Red Alert: The Flippers Are Back

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“I think 2014 will be the year when we see that home price appreciation pulls back to more normal, sustainable levels,” says Daren Blomquist, vice-president of RealtyTrac.com, a site that aggregates real estate data. Markets that boomed in 2013 will likely scale back to more modest growth in the low double digits, while nationwide growth should average about 4.5 percent, according to Blomquist.

Even with recent gains factored in, most markets are not at risk right now for another housing bubble. Nationally, home prices remained 4 percent undervalued in the third quarter, according to Trulia?s Bubble Watch. Only Orange County, Calif., and Los Angeles are more than 10 percent overvalued, the report finds.

The hottest markets for 2014 won?t be in the big cities. A joint study of more than 1,000 real estate industry experts done by PwC and the Urban Land Institute ranks real estate prospects in smaller secondary markets including Houston, San Jose, Dallas/Fort Worth and Austin above those in larger cities like Chicago, Atlanta and Washington, D.C., where ?there’s a lot of money chasing a few assets,? says R. Byron Carlock, Jr., PwC national real estate practice leader.

It?s still 35 percent cheaper nationally to buy a home than to rent one, but that doesn?t mean millennials are rushing out to get a mortgage. Just 18 percent of consumers surveyed in September by Credit.com said that buying a house was still their definition of ?the American Dream.?

– See more at: www.thefiscaltimes.com/Articles/2014/01/03/Real-Estate-2014-Need-Know-Guide#sthash.lbcPIoIl.dpuf

Time for Buyers to Jump In Before Rates Go Up

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U.S. Government programs are expected to wind down in 2014 according to various information posted recently, and will likely lead to higher mortgage interest rates due to the improving Real Estate Market. The Real Estate Market isn’t all a rosey picture though, and some speculate and still on the fence. Read up for yourself.

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Click to read RIS Media article “Home Values Expected To Rise Through 2018”