A Native Austin Practice

Townhomes & Leasing

2012-02-02T09:29:00.004-06:00

from Austin Board of Realtors;

Townhouses & Condominiums
The volume of townhouses and condominiums (condos) purchased in the Austin area in December 2011 was 157, which is 17 percent more than December 2010. In the same time period, the median price for condos was $179,900, unchanged from December 2010. When compared to the same month of the prior year, these properties spent three more days on the market, or an average of 92 days.
Over the course of 2011, 1,970 Austin condos were sold, which is one percent more than 2010; the median price was $167,750, or six percent more than 2010; and condos spent an average of 94 days on the market, 10 days longer than 2010.

Leasing
In December 2011, 1,030 properties were leased in Austin, which is eight percent less than December 2010. The median price for Austin-area leases was up nine percent at $1,250 when compared to the same month of the prior year. In all of 2011, a total of 15,948 properties were leased in Austin, which is three percent more than 2010, and the median lease price was $1,250, or four percent more than 2010.

don't "shift" on yourself

2012-02-01T18:47:00.002-06:00

market could be changing with lower inventory and higher sales demand. For example there are only 4 total listings on the market in Village Western Oaks. If buyers wait they will could find themselves paying 10-15 percent more very soon. While it could be too early to tell what is really going on this point is spot on; in 2011 our market inventory shrunk 20-25 percent across the entire area!
With all that has been going on and continues to go on in our global economy, time on the market should decrease. Buyers need to be prepared and at the very least know that when they see "it" don't wait! Have clarity in your housing goals and have your lender letter ready.

We (I) need listings!

2012-01-23T20:27:00.000-06:00

Our market needs inventory! We need listings, homes for sale. Currently around 7200 homes on the market. To compare we almost got to 12,000 in July 2010 when demand was much less. If you know homeowners who are thinking of selling specifically in Central Austin, Westlake and neighborhoods off of Wm Cannon and Escarpment please let me know. This is 'text book' with 1) rents going up, 2) lower supply of homes, 3) consideration of buying weighed against renting. Read on, very interesting (i know i know, but "Greece")...
http://bottomline.msnbc.msn.com/_news/2012/01/23/10217301-home-buying-could-soon-beat-renting#.Tx3gHCL36HE.email

Challenging Times part 2

2012-01-14T10:37:00.003-06:00

A friend has a house to sell. This person bought this home while married and is now divorced. It is a short sell (on the market for less than what is owed to the bank/lien holder). A sensible offer has been submitted by a qualified buyer and my friend has accepted. The lien holder reviewed the offer and has also accepted this 'short sell'. Now the other / "ex" must also accept for this offer to close. This "ex" refuses to sign off (possibly out of spite due to the unfortunate side of a divorce and issues around a marriage that has ended). This sale is now dead and the house will go into foreclosure affecting BOTH sellers credit (I wonder if the "ex" not willing to sign off realizes this?????).
The one who wanted to see the home sold via a "short sell" should consider this since it will likely go into foreclosure; write a brief summary of 'why' it went into foreclosure and send to the 3 major credit reporting agencies. This note to the credit reporting agencies won't keep the credit score from being damaged but will explain to future 'credit pulls' what the foreclosure was all about.

Challenging Times part 1

2012-01-14T10:29:00.004-06:00

Friend/Client called with a question for their parents. The parents live in another state. This particular state has been one hit the hardest, always being mentioned as one of the top 4 states with highest depreciation of real estate values. While Austin/Metro Austin has been experiencing troubles since November 2008, this market has been "feeling it" early 2007 and much much worse.
So here is the question from my friends/clients, "my parents want to move here to Austin because of the grandchildren in Texas (two sets) but their home has lost it value. If they were to sell it would be a 'short sell'. Even though their credit is above 800 they might want to go ahead and take the proverbial hit. They have been waiting for over 4 years to do this and nothing seems to be improving. They attempted to sell 2 years ago with zero results. What will this do to their credit if they attempt the short sell?".
I called a lender for some feedback on this question. First, a mortgage payment(s) needs to be missed. Then the process can begin since a mortgage company sees no reason to accept less than what is owed if all payments are being made. And there is no guarantee the bank will accept a 'short sell' in any event. The real question is what will this short sell to do a 800+ credit score? The answer is an estimate due to all the variables but in short, it will drop it to low 600's or 500's quickly.

Homestead Exemptions (this is a long one)

2012-01-13T19:30:00.001-06:00

Texas Homestead Exemption

It’s that time of year again – time for those interested in benefiting from the Texas Homestead Exemption to file an application. The information in this post applies to any homestead exemption request in the State of Texas specifically in Travis County.
What is a Homestead Exemption?
For those new to this, a Texas homestead exemption reduces the taxes you owe on your home. For example, Texas school districts are required to offer a $15,000 tax exemption for qualified applicants, which means if your home appraises for $200,000 as of January 1st, the amount you pay in school taxes is based on $185,000 ($200,000 home value less the $15,000 school tax exemption). Austin’s school district rate for 2010 was1.227 , so in this example, if you filed for a homestead exemption on a $200,000 home, you would save $184.05 in taxes. Other taxing authorities (e.g. county, city) may offer exemptions of up to 20% of your home’s value, so filing for a homestead exemption is worth your while.
Who is eligible for a Travis County Homestead Exemption?
Homestead Exemptions in the State of Texas are granted to home owners who apply for the exemption on the home they consider their primary residence that they were living in as of January 1st of the year in which the exemption is requested. If you are 65 or older, or disabled, there are exceptions to this rule that are described in the application.
What is the Travis County Homestead Exemption Application process?
To apply for the Texas Homestead Exemption:
Fill out the application: Travis County Homestead Exemption Application.
Helpful Info: For married couples, either person may be listed at the owner (the other owner blank is for 3rd party owners), just be sure the submitted required documents in Step 5 are for the person listed as owner. To obtain the Legal Description and acreage information requested on the form, you may want to look up your home’s tax record on using the Property Search on the Travis County Appraisal District’s Website.
Include the required proof of residency documentation (see NOTES below) required by the new law that went into effect in September of 2011.
Submit the application to the county appraisal district where your property is located no later than April 30th of the year for which you are requesting the exemption. For Travis County residents, you can mail, fax (512-834-8651), or hand deliver the application and required documents. For questions, or to verify any of this information, call the Travis County Appraisal District at (512) 834-9138. There is no charge to submit the application.
IMPORTANT NOTES:
The new proof of residency requirement is stated on the Texas Comptroller’s website: “House Bill 252 requires a copy of the homeowner’s Texas driver’s license or state identification card and the homeowner’s vehicle registration receipt be sent with the homestead exemption application. If the homeowner does not own a vehicle they can send a current utility bill showing name and address, along with an affidavit provided in the application indicating non-ownership of a vehicle. The address on the documents must match the address for which the homestead exemption is requested.” (Texas Comptroller)
If you do not have a copy of your vehicle registration receipt, you can request one from the Texas Department of Motor Vehicles. For Travis County residents, call 512-854-9473 to request a copy over the phone and have it sent right away via email. You will need your license plate number when you call. The charge is $5 ($2 plus a $3 convenience fee) for a phone order. To request a copy via the mail, see the TxDMVVehicle Registration FAQ page or go directly to the request receipt form.
Please also note that additional information is required for those filing for the exemption on a manufactured home.
Do I have to reapply for the Texas Homestead Exemption each year?
Once you are granted the exemption, you do not have to reapply for it annually unless the Appraisal District notifies you that a new application is required.
Disclaimer and Additional Information
The information above is not to be considered tax or legal advice, but is provided as a helpful reminder to our site visitors and clients. For the official rules and details on Texas Homestead Exemptions, see the Texas Homestead Exemption Application and visit the Texas Comptroller’s website for additional information on Texas Homestead Exemptions.

Buyer Frustration of the times

2012-01-10T11:24:00.003-06:00

Here is an example of the frustration both Sellers & Buyers are experiencing; qualified buyer wants to buy a bank controlled house but cannot get a response from the bank - huh??? Seriously? Are there not a high number of homes that need well qualified buyers? One specific example I am working on is in Central Austin where my client buyer could pay cash or work with the current lien holder to get a loan. Neither the Seller nor I can get this major banking institution to respond and it has been posted on the foreclosure list the last two months...this has been going on since early September 2011 - over 3 months! A second specific example I am part of is in South Austin where we have made a good offer to buy but the bank will not even return the calls of their own Realtor, choosing to just keep a price that competes for better conditioned homes that have sold in the same neighborhood.
I find this fascinating and annoying; it would help if a response was given (a "no" would even provide some relief) AND if the financial institution who has the toxic asset would realize their price is waaaayyy off. These scenarios not only make the buying process extremely difficult on the buyer, but also makes the seller go through some additional mental hardship because nothing is being done to give closure.

Bonus/Over time for loan approval

2012-01-09T09:40:00.001-06:00

Are planning on using your bonus income or overtime income to help you get a mortgage?

...If so, then there are three important things you need to be aware of:

1) Lenders can't use bonus income or overtime income unless you can prove you have been receiving this income for 2 years.

2) The employer has to indicate that the bonus or overtime income will likely continue.

3) Lenders will use a two year average of bonus and/or overtime income. So, if you got alot this year, but not last year then we will have to use an average of both years.

2012 Forecasting

2011-12-12T13:53:00.000-06:00

Housing numbers rebound

National economists and analysts have begun to awaken to the fact that the national housing market, (new and used) is beginning to turn. That is to say that most Real Estate markets cannot fall much farther.

Link to the full story:
http://www.housingwire.com/2011/12/05/barclays-analyst-sees-housing-rebound-coming-in-2012

What does that mean here locally?

· First thing there is no such thing as a national real estate market. A sale in New York has no affect on a sale in Austin! A sale in Georgetown has no affect on a sale in Buda. It just doesn’t.

· Locally as well as regionally (Austin, San Antonio) the market has turned. Is the robustness of 2006? No. Locally, values as well as volume of sales are better than 2009 /2010. We have fewer inventories available. Less listings in MLS than we had a year ago, less new homes available, less developed lots available, less rentals available, less office space. Very little has been entitled or developed the last 4 to 5 years putting pressure on the market inventory. The local market is just waiting for a positive sign!

· So, why hasn’t the demand been there? In those national markets where unemployment and foreclosures are high, there is an obvious answer. Here in Texas and Austin where the market has received national attention for its robustness, it’s been slower than desired. (However it has not been negative.) Austin, San Antonio and Houston have been much stronger, but the national housing malaise and tight credit has held back on the consumer’s desire of spending money in a recessed economy.

· So, what should you do? There has not been a better time to buy a home. We will not see the affordability or the mortgage rates that are currently available. 2012/13 is the time to buy, before the housing economy locally begins to heat up and the home you want is more expensive and not as well located as you wanted. The House / apartment you look at today will be gone tomorrow! From an analysts view, there is not a better time to invest in the market. Are you going to see the discounts you have read about? Talk to you real estate professional………no. Those opportunities are gone and have little to no opportunity to become available in the near future. Begin educating yourself and your clients, with Austin and Texas’s national exposure and robustness, the market is set to come back stronger.

Mark Sprague State Director of Information Capital for Independence Title is a respected analyst of the real estate and financial industries, and the Austin market in particular. For more information contact Mark at msprague@independencetitle.com.

Industry Facts & Figures

2011-11-18T06:48:00.003-06:00

I don't think you will find these being reported too often.
81% of Americans and 55% of Canadians view real estate as a good investment.
78% of Americans and 46% of Canadians feel that housing prices will hold steady or increase over the next 12 months.
80% is the percentage of major U.S. Cities where its cheaper to buy a home than rent.
25% of young American and 43% of young Canadians plan to buy a home in the next two years.
In 2010 15 million renter households were qualified to buy a median priced home compared to just 7.7 million in the year 2005.
Housing affordability remains high in American and most Canadian markets; in the U.S. it reached its hightest level in 20 years in late 2010.
95% of homeowner are happy they decided to buy a home.
First time home buyers comprise 35% of home sales in the U.S. and 50% of home sales in Canadia.
67% of first-time homebuyers said the market granted them the opportunity to purchase a home sooner than expected.
50% found a home in a better neighborhood than expected.
61% purchased their home at a better price than expected.
43% locked into a lower interest rate than expected.
69% of Americans and 55% of Canadians say that now is the best time to buy a home.

another one on foundations

2011-11-17T10:23:00.008-06:00

Currently with one of the worst drouths ever recorded in Texas I see another reason to post some reminders about home foundations. This current dry weather pattern/lack of rain means the obvious, less moister in the ground for the same clay soil that swells with rain fall. The soil settles-compacts-shrinks, basically "drops" a little here and there.
I hear adds on the radio about foundation work. These adds can prey on fears that our foundations are caving in and they outline how "their piers and drilling go deeper than other foundation companies". Hitting bedrock is the final goal of a drilled pier, sometimes we don't need to go that far. How one company states "going deeper than any other" seems odd to me... Hiring a foundation company to "fix the problem" is not the first step. THE NUMBER ONE SOURCE FOR YOUR FOUNDATION QUESTION IS A RECOMMENDED STRUCTURAL ENGINEER TO ASSESS THE ISSUE. So some points to keep in mind are; Investigate your down spouts, the down spouts of your neighbors on either side of your home, the integrity of curbs (curbs and the way our driveways are created should keep water from entering your yard, should influence the water flowing down the streets), clean your french drains & gutters, look for areas in your yard where landscaping can improve water flow, consider location of trees next to your home.

Communication

2011-11-17T09:30:00.008-06:00

In '95 my cell phone was just like Gordon Gieko's from the movie Wall Street. At the time the majority of phone interaction was over 'hard lines' with a random pager from time to time. Now the majority of phone communication is cell phones. It seems the last 36+ months (growth of smart phones) has provided even more diverse communication methods; texting, social media (basically emailing through facebook). Some still like to be called at their office or home 'hard lines'. Others like only cell phones while others like email. I am finding more people never listen to a voice mail deferring to email/text which decreases "phone tag".
In a transactional situation everybody should discuss how best to communicate (including a 'point person' in a marriage / couple situation) early on - set communication expectations because there are a ton of options. While typing messages & emails is very effective you can count on a necessity to talk directly and share ideas to develop strategy relative to the transaction.

4 homes for sale on one block???

2011-11-17T09:22:00.004-06:00

I was asked the other day why one block had 4 homes listed for sale? My answer was, "often a home sells for a high price and it gets the attention of the entire neighborhood kicking off other home owners to sell (move up/move down/capture their equity the old fashion way). Of course the 'other side' of this question is the concern that something negative is going on which only the current neighbors know about. Compounding this scenario are the stories from Las Vegas, parts of Florida and Southern California where the foreclosures bring down values and have back HOA dues. Fortunately with inspections, deed restrictions, HOA by laws being shared & title insurance investigations much is learned before closing.
I went ahead and researched this exact street and sure enough, 4 months ago a home sold for a higher price per sq ft than seen in years. The "high price sale" also requires knowing the specifics; how big is the home? what upgrades are in this home? how is the landscaping? what is the condition? how easy was it to show?. Without realistic data this one confirmed / sold home can lead to a few over priced listed homes that sit for a long time AND really frustrate the owners.

5%

2011-11-17T09:03:00.003-06:00

Don't over price your home and exceed 5% of the market value.
Homes listed for sale should sell or at least receive an offer if they are at or less than 5% of their market value. Many Buyers get intimidated when making offers, not everyone is comfortable with negotiations. Buyers get even more uncomfortable if they view their offering price to be drastically below that of the list price. This is especially true if the house is new to the market. What do you think is said if the house has sat on the market for over 100 days? ..."what is wrong with that property?".
Stated in earlier posts sellers should know their list price to sell price ratios (LP/SP). If this ratio is 97%, than a seller should not list more than 3% over their market value (market value is not county appraisal value).
Consider what being over priced by 5% means from the perspective of the buyer;
$125,000 = $6,250 (first time buyer, one of if not THE biggest purchases to date)
$185,000 = $9,250 (first time buyer, maybe newly wed, tons on their proverbial plate)
$250,000 = $12,500 (kids, new parents or maybe buying a home alone)
$1,500,000 = $75,000 (buyers at all ranges don't get to be buyers in this market without watching their bottom line, especially true at the million dollar prices).
There is a shelf life to homes on the market which is a good reason to know Days on Market (DOM), LP/SP and your market value from activity in the last 3 to 6 months.

What are my options for leasing my house?

2011-10-17T06:05:00.005-05:00

The way I see it you have 4 options.
1)You can do it yourself. 2)You can hire a Realtor to find a tenant. 3)You could hire a management company. 4)Go short term vacation rental depending on your neighborhood rules and deed restrictions.
#2 option-Hiring a Realtor to find a renter and then you/owner manage the term and duration of the lease directly with the occupant. Expenses on this range from 60% to 80% (varying 10% plus minus) of first months rent. This hypothetical 60% - 80% is the commission to both Realtors involved. Value in your Realtor is background check, running credit check through a formal agency and casting a wide net for finding a good tenant plus showing the home to candidates.
#3 option-Hiring a management company will handle most of the details day in day out. This cost is around 6% to 9% of each months rent. There could also be a commission added when a new tenant is needed. Typically having more than one property makes this route more popular.
#4 option is one I will defer to your own investigation. With my own investment property I am intrigued but have not experienced it yet.

W.I.I.F.M.?

2011-10-17T05:59:00.006-05:00

Whats in it for me (W.I.I.F.M.) to accept?
A question buyers and sellers ask themselves when negotiating a housing transaction, especially true if they 'feel' they made a good offer or counter offer.
Don't be shy to ask your Realtor, "whats in it for me?". This would typically pop up when you have received a less than list price offer or you are buying and your offer was countered. Utilize the value of your Realtor and listen to some points of consideration that could be useful in digestion of what is on the table.
Full time Realtors are constantly working in the housing market and the one you chose has a fiduciary responsibility to your needs if they know them. A major value in a Realtor is the fact they are not AS EMOTIONALLY involved as The Buyer & The Seller. Your Realtor could have some good insight to consider, a way to allow time to consider all options which relieves pressure for a quick decision. A Realtor has access to data that could make a decision to keep looking (for another buyer or another home) more digestible.

Consideration of the other side

2011-10-10T09:48:00.003-05:00

A lot is and has been said about pent up inventory of homes. Are there a large stockpile of houses that are coming out which will flood the market? I don't know but it is being reported as a concern. This same concern involved commercial real estate about this time last year and it ended up not being as big of an issue. All this revolves around inventory but what about consumption? Read this;

http://www.marketwatch.com/story/millions-waiting-for-right-time-to-buy-a-home-2011-10-07?link=MW_latest_news

Stats and area LS

2011-10-07T08:19:00.002-05:00

Updated stats as of August 2011 are out (real estate stats lag almost 2 months behind today's date due to transactions being closed but not reported immediately). Of all areas the Lake South (LS per Multiple Listing Service/MLS definition) earns top honors with;

$42,814,945 for sold volume with 98 sales
Average price of $436,887
This area makes up 8.03% of the volume in the market during August which is at the top.
The area has 4.63% of the sales.
The only other areas that come close to percentage of sales is parts of Cedar Park and parts of Round Rock.

I am a fan of Lake South (also loosely referred only as "Lakeway" but there are other neighborhoods like Flintrock, Apache Shores and more), LS per MLS. True this area has a wide price range of homes and is a big area but this area has a complete package. Public Schools are great from K through Senior H.S.. Homes are newer and amenities are established all along 620 (sometimes set back so you have to look while driving by) not to mention a football program that is proving to be a state powerhouse and it is close to a lake when we get rain.

Provide the details

2011-10-06T21:30:00.005-05:00

When making a less than list offer provide some details for the "why". Your Realtor will provide excellent value in this area.
Discuss in a letter to the other side (listing Realtor/owners) your reason for pricing their home the way you did in your offer; examples of similar homes that recently sold, market conditions you as the buyer are facing (relative to the market this seller is selling in), concerns that keep you from 'hitting' their list price. Best to start this letter with how much you like the home. It would seem obvious that you like the home enough to make the offer but don't just jump right into criticism of their home before highlighting their work and effort (a mistake Realtors make when starting a negotiation - I am guilty). If you have seen a ton of homes, waited for a long time to pick the right one let the sellers know. End this letter with why you could be a great buyer and great match with your sound qualifications. Your Realtor is perfect for this as they know the market, know how to communicate your message within the current market environment and they want to help you get that home.

Large yard & defining "location"

2011-10-03T15:34:00.003-05:00

A client who has a ton of business experiences around the world made 2 great points as we discussed his housing goals.
The first one he had was on how to find the perfect home, "stand on the porch and look out into the neighborhood, if you like what you see go for the home because you can always change what is behind you." (behind you would be the house itself) This is especially true for locations with fantastic views and water front. I have previously posted that buyers should find a sense of enjoyment in the neighborhood when driving to the potential 'house of choice' and less on the house itself. When you have had a long week, long day, a big reason to buy (That American Dream) is really liking the neighborhood surrounding your home (like the streets for a walk, like the playground nearby for your kids, like the shopping, on and on). Standing at the front door with the house behind you and looking out is a better way to state this point.
Last, if you want a larger yard consider reducing expectations on year built for your search criteria. Generally speaking the more recent developments have reduced the lot size to maximize R.O.I.. Better common area parks are being offered and smaller lots are being sold than in the past. You might have to settle on how upgraded the home is. This brings us back to what are your top 5 must haves before considering an offer? In the current market with higher inventories you might have a chance at a remodeled house in these older areas that is priced close to non updated houses.

Real Estate Industry to Central Texas Economy

2011-09-28T19:05:00.001-05:00

The below stats courtesy of the Real Estate Council of Austin:

Do You Know How Important the Real Estate Industry is to the Central Texas Economy?

- It generates more than $17.4 billion in total economic activity each year.
- It employs more than 121,000 people in Central Texas for a total labor income of $5.4 billion.
- It generates $204 million in local tax revenue annually.

It is hard to price

2011-09-28T18:31:00.002-05:00

It is hard to price a personal home. Double the difficulty when the market changes. When the market changes like it has in the last 3 years we tend to remember a higher price. This applies to trading cards, antiques, cars and on and on. Take for example the price point we might have thought our home was worth BEFORE November 2008 (when the mid west, Texas and Austin fell into the real estate recession once the stock market crashed).
Even though we did not want to sell our home around this time in 2007 & pre November 2008, we still had a vague idea on price. Fast forward to today and the need to sell. It is hard to change the number from the peak of that 2007 & summer '08 pricing to current 2011 pricing. We naturally want to hold onto the higher price. This is one reason a home sits on the market and inventory builds compounding the need to price right.
Second most difficult aspect to pricing is a price correction, or reducing a price after "x" number of days on the open market. If for example a home needs to decrease its asking price by $10,000 it could be argued that $10k is lost. Another way to discuss a price reduction is the fact the $10k was just never there to begin with in the current environment. Gold is an example of a current market condition that currently rewards a person for holding the longest. In other markets like housing there is a volume of sellers that under cut the rest. This brings back the number one most important question in selling in residential real estate, your "why"? Your "why" will aid in setting your price.

Now is not the time to settle

2011-09-28T14:33:00.004-05:00

If your a buyer in the Austin area market it is not the time to settle on a home that does not have the majority of your realistic expectations. There is inventory to chose from and 'realistic sellers' plus the low fixed 30 year mortgages. Have a wish list of 1-5 that you must have to make the offer (i.e. price, size, location, commute, finish out). Finalize your wish list with another round of 6-10 (garage, pool, wood floors, storage, landscaping) that would be nice to have but not mandatory on your purchase. Having realistic expectations is critical here, it is a great time to be buying a home in Austin. If your having trouble locating a home than you could be in your own way. Double check your wish list and make sure it is realistic.

One key reason is the freedom to choose

2011-09-14T06:58:00.005-05:00

I was catching up with friends who bought their first home last year. They have to replace the flooring since a hot water heater broke and flooded, damaging the current floor. This was an insurable upgrade. They were not selling, but I was asked what is the best choice for flooring? Their question about what to choose for flooring got me thinking.
5 years ago we all looked at residential real estate appreciation in terms of 12 month periods. 20 years ago it was assumed appreciation would take years. I think we should return to that mindset of "20 years ago". This is a benefit to the 'situation' the country is in regarding residential r.e.. I told them to choose what they wanted. Do anything that you desired. Don't worry about the best choice for someone else or the others outside of the front door. Being able to choose what we want inside our home without a landlord/management company input is a major piece to the American Dream. A remaining question could still be, "what if my choice hurts me selling the home later?". My answer to this one would be how quickly would you be selling? and then I would return to the encouragement of enjoying a home and the freedom to choose that comes with ownership.
In order to protect the money spent on an upgrade like flooring in this case simply keep the house for a long period of time. When you are ready to move don't sell but lease it out, turn the home into an investment. The initial down payment was for owner occupancy which was achieved by living in the property a long period of time/many years. Let appreciation have years to develop while you live in the house. Tweak the house to your interests because you can. Stay in the house for the long term. Go ahead and wait to stage the house for the public when you sell the property many years from the purchase.

Paying attention when city is the remodeler

2011-09-14T06:45:00.004-05:00

In the mid 90's I lived off of Crockett and S. Congress and the local paper Austin American Statesman reported the city was going to do what it could to improve this stretch of South Congress. Around '95 the neighborhood real estate was already in demand but the historic stretch of S. Congress was not the pedestrian friendly rich environment for shopping & restaurant/bar it has become. I just had dinner with my family there over the past weekend.
News just broke that the city is interested in another remodel of another street - Airport Blvd.. I would encourage homeowners who have thought of selling to hold on. Based on the success of South Congress this could be another story where one wished to have bought in before the work was started or completed.
Article I reference is from Austin Business Journal 9/9-9/15 Volume 31 #27 by Vicky Garza

What is so important about ABOR (Austin Board of Realtors)

2011-09-07T07:52:00.007-05:00

For years banks and private investment groups have wanted 'in' on real estate multiple listing services, the MLS. "They" consider it public records that "they" should have access to. And for years this has been prevented, you should hope this continues if your a home owner or interested in buying a home.
The multiple listing service (MLS) is run by a governing board in the area it serves. In Austin it is Austin Board of Realtors (ABOR). These boards are non profit. The only way a state licensed person can become a Realtor is by joining one or more of these boards then following board rules and guidelines, otherwise one is just licensed in the state of Texas and NOT a Realtor. Realtor's are directly associated with the details of the sales and it is these same Realtor's that follow board procedures on board software in specifics of a transaction. The data is imperative to the entire process; pricing a new home on the market, formulating an offer to a new listing, knowing trends, Appraising (Appraisers are Board members). When a home owner wants to learn more about pricing is not done through 'zones' or grids like on Zillow or how our Texas Counties value for tax purposes. This home owner calls their Realtor and they review data from The MLS sponsored by The Board of Realtors in their area. When a buyer seeks data to formulate how they will offer on a home the same procedure is applied. A board employee even calls us Realtor's when something is not filled out correctly. Since each Brokerage Office and every Realtor is basically independent the data IS NOT influenced by a conglomerate or investment group nor does the board have any interest serving share holders like a bank would. This way data has a better chance of remaining market driven. Data from a board of Realtor's has less chance of being influenced than if it were under an investment group with a number of other companies that could or could not have real estate holdings.

Repairs

2011-08-25T20:44:00.003-05:00

Your a buyer of your homestead and you just found the perfect home and wrote up an offer with the guidance of your Realtor.
Your Realtor just called - your offer was accepted!!
This means you just started asking "what is wrong" with this property????!!!!!

You like the home the most before you have your offer accepted. Once it is accepted, you wonder what you did wrong.
Welcome to every case of Buyer Remorse or my personal definition of it. You still have wiggle room unless you are in an extreme seller market. You will have an option to terminate (in Texas) if a surprise pops up within a time period. This period allows inspections and follow up inspections. These inspections should offer a good amount of information on the condition of the property you are buying. Will it offer everything? NO.
Are you building brand new? buying a resale that is 80 years? found a total remodel? Does any of this matter to the fact you won't get ALL your conditions answered before taking ownership? NO.
Be reasonable to the condition of the home you are inspecting to other homes in the area. Listen to data and ask questions directly to the professionals that are doing the reporting on condition. Be physically at the general inspection (which could be an inspection of code violations more than repairs) with out any additional distractions. Ask the inspector directly these questions,
1. "what would you want further information on from specialized contractors?"
2. "what would you fix/repair/tweak if your mother was buying the home"?
3. "are these repairs consistent to other homes in the area"
You likely discussed pricing, condition (upgrades or lack of upgrades), location (you have seen other homes in the area) with your Realtor so now take the report and re visit that discussion. Is the importance "location location location" or "condition condition condition"? What does the rest of the market think?

I hate that one!

2011-08-25T20:31:00.007-05:00

Know what you don't like for your housing decisions. You will know what you like when you see it, but what if that takes some time? As you are answering the question of what you like in the market your looking in (which could be a new regional area or area of town) establish a list of what you hate. Second+ buyers know this because they know they want to sell and why they are moving. First time buyers are often overwhelmed and this could be a good place to start. Share it with your Realtor. Action of any kind could help reduce the frustration. Take the frustrations out on a list of "dislikes".
This way your Realtor can listen to your objection and take action, applying your feedback to new areas or ways to tweak the search. This new list will help when the previous home or list of homes did not meet the standards you were expecting AND this will get you closer to the type of home you want which the market will provide. Cast a wide net! It might be the aid in negotiating with yourself over your own set of expectations. Learning the market your in is key, trust your 'gut' and enjoy the process as best you can.

What is clay soil???

2011-08-22T06:45:00.003-05:00

Since coming into the business of selling homes in 1993 I have always thought of the issues with clay soil under wet conditions. Now with this 100 year drought it is fascinating to see similar issues with dry conditions.
Clay soil swells with water. The soil literally is like a sponge and expands. This action of swelling will push a house up and move a foundation to points of damaging pipes inside the cement foundation. Corrections can include foundation repair but not usually and not always. Adding gutters, running a sprinkler system, landscaping a certain way with a good amount of caliche dirt as base are some of the remedies.
With the lack of rainfall our clay soil is turning to dust. This dust is compacting and moving as well, going down and shrinking. This shrinking has the same affects of damaging pipes and the outside cement fascia plus interior sheet rock (usually just the tape n float seems). Water rationing is part of restrictions during a drought which ends up affecting the sprinkler system being a tool. This is new to me since I have only been in the business around 18 years and this drought is a 100 year cycle.
My point is don't panic. Don't immediately think you have a major issue requiring a foundation company. Exterior cracks in a home can typically demonstrate soil influence. Interior cracks could also mean settling but could mean a plumbing issue. After turning off your water from the street and watching the usage on the meter, a plumber could be the first and best call to test the water pressure. Then you call a structural engineer, then you get referred to a foundation company.
Regardless of wet or dry conditions you don't start with a foundation company. You systematically run through a check list that could include a foundation company.

Days on the market, like those showings

2011-08-06T07:24:00.004-05:00

Here is the scenario; you decided it was time to sell your homestead (not an investment property but where you have been living). You consider this decision and implications for months (3 months for the sake of this entry). After 3 months you talk with your preferred Realtor and eventually get the home listed 1 month later after a "make ready"/staging list. At this point you are 4 months into this process and likely a little exhausted but MOST IMPORTANT the general public/market is within days of knowing about your property/home for sale. It is a marathon so pace yourself.
If the average time to sell is 92 days, this could result in almost 7-8 months from when your mentally decided to sell to getting an offer. My point is to hang in there. When your tired of cleaning and showing and all messages from Realtors just hang in there with your faith. You likely have a very sell able house and just need to be patient, breath deep and be excited for sales activity in your market. Know your average days on the market (your Realtor will tell you), keep up with pricing (again your Realtor) and trust in the feedback from your own Realtor. There are way too many homes on the market to expect feedback from each showing.

Lease it if you can't sell it (for Austin,Tx.)

2011-08-06T07:22:00.003-05:00

(This is a repeat)If you have had your home on the market and it is not selling consider leasing it. Live to sell another day. In Austin the leasing market is about as opposite of a market as you get from sales. Full price (maybe over list price at times), short days on the market (less than 25) and good candidates describe the leasing market. Nothing wrong with adding a property to an investment portfolio. The lease agreements will cover numerous aspects like; pets-guests who visit & number of days allowed for them to stay-number of cars-smoking/no smoking-yard care-repairs-access-renters insurance. If buying another home is important then talk with a great lender to see if you can qualify without selling. My market area (Austin Metro) is experiencing a high volume of newcomers and the leasing market is very busy. If your currently a seller who is frustrated with over 150 days of being on the market consider the "leasing option". It provides one more option along with price reductions, repairs or upgrades when selling.

Air Filter and Weeds for your cooling system

2011-08-06T07:11:00.003-05:00

For those of us not in Colorado or other cooler climates do the following for your cooling system. Change out the filter for better air flow, cooler air and little reduction in your electrical bill. Go outside to check the big metal box associated with your cooling system (condenser)for grass & weeds growing around it. Since it is so dry and your system puts some condensation around this area there is a good chance the grass/weeds are growing happily. Remove this growth so nothing obstructs any part of your condenser. If the exact opposite is going on outside near this condenser with just dirt (so these days dust) you might consider having your condenser cleaned. All this improves the systems functions, reduces a little on bills. If you have questions, call Moody's here in Austin or your preferred A/C & Heat person (your welcome to call me I just defer to Moody's).

technology issues

2011-07-14T17:27:00.004-05:00

Realtors in my market place can set up fantastic personal web sites tailor made with specific search criteria for buyers (also useful for sellers). My Austin Board of Realtors (ABOR) deserves the credit for the technology. This tool is, well, a great tool. The data provides price changes, picture additions, details on the home - this technology provides almost everything a buyer wants for a first glance. I think there could be an argument of providing too much dependency on this one tool. Buyers want and should get the information. The issue I see from time to time is a buying principals getting overwhelmed with options from the updates. This personal web site I mention sends the data to emails. With mounting pressures at the office or at home with kids, it can be hard to look through the list of options. This is especially true in todays high inventory market of listings. If your a buyer, make sure and get into a car with your Realtor to open up doors in your ideal target area. Look through homes with your Realtor. Let that Realtor do the driving while you look at the neighborhood. Chances are good that you have chosen a good Realtor and this professional will listen to your feedback and criticism of the homes you see together. Having direct contact with your Realtor while viewing homes creates a platform of consistency for the eventual decision. It can be tough for a Realtor who wants to provide assistance in narrowing down the search if they don't see a minimum number of homes together with their client. This will aid in not missing a really good property/home that might just have bad pictures - it was raining - the copy is poorly written. The web site is a great tool to support the process. But somethings can't be beaten by technology, and this is one of them. It also goes back to a core value in working with a Realtor. I can't think of another comparable service in a sales situation than that of a Buyer Agent Realtor working with their buyer principal. The builder has their own sales force - for the builder. The car dealer has their sale team - for the car dealer. JC Penny has a sales team - for them. Realtor is a personal shopper to some degree. This connection is best utilized when buyer and Realtor are together looking at homes. Can you think of another service in a sales situation?

Loyalty reciprocation

2011-07-08T14:08:00.009-05:00

Reciprocating for highest/best loyalty

While driving I caught my 7-8 minutes of sports talk radio with an interesting discussion on loyalty. The syndicated host of the show mentioned he has "stand alone" loyalty to his wife and kids. Nothing else gets his undivided loyalty.
The host went on to discuss that he does have loyalty to others and his work, it is just 'conditional loyalty'. He was separating 'conditional loyalty' from 'absolute loyalty'. He explained his 'conditional loyalty' at work reflects the loyalty his boss/owners of ESPN show him. In summary, this radio host was saying that he reflects the same loyalty he is shown.
This discussion got me thinking of "loyalty" in my line of work. But how does it start & how does it get on track for a great buying experience? My industry as it relates to "Agency" thrives on the degree of loyalty involved. Both principal and salesperson/agent/Realtor seek loyalty from one another. Through this loyalty comes open communication and trust. Good communication leads to great discussion which leads to informed decisions. Considering my line of work (an agent, Realtor for others through sales) it is interesting when I personally don't trust a salesperson through other endeavors. I know I have had obstacles to giving my loyalty with car purchases, remodeling jobs with contractors and cell phone stores. It even shows up when I am looking for a simple shirt at a store - "no thanks, just looking". If I don't feel a sense of loyalty from the sales person, it is hard for me to give it back to the sales persons. This scenario plays out to where I can't allow myself to be helped because I am not comfortable opening up with what I want and what I expect. This is a fascinating scenario for me because I am on both side as both the customer at times and the salesperson.
Have you ever had doubts about the loyalty towards a salesperson only to realize it was your own trust issues in general?

Where to have the "first meeting"

2011-07-07T19:14:00.003-05:00

My wife and I were updating our life insurance and it required taking blood and other aspects. To do this we had to meet a nurse representing the insurance company. I was surprised to have an option to meet this nurse at their office OR have them come to our home. I took a home visit because it was easier on me.
The home visit was a good idea I thought, but it became complicated for all of us and slower. The nurse needed some additional forms which put her on our computer. We had printing issues with the program and my kids were fussing which is always tough with business at hand. Taking the nurse out of her office for a home visit took her away from her office where she had everything to perform her work and expedite our meeting. Our meeting took longer and required me/my wife to do some extra work. Almost every time I meet someone away from my real estate office it does not go as smooth as it could have gone if we had met at my office. The restaurant is loud, the computer connection is bad, the programs don't work, we run into people we know that slows our private business at hand.
This is an area similar to lawyers and accountants. When we get together with this industry we go to them. I was surprised to have a medical professional come to my house but in hind site I should have gone to her office where she had all the tools to do what she does. Sales is a mobile profession but there are specific times to do specific steps at an office vs. a Starbucks. What do you think?

Expecting vs Inspecting on older home purchases

2011-07-07T19:10:00.009-05:00

Putting a home under contract has some initial expense with earnest and option money. There is also a cost for your general (and possible subsequent specific) inspections after coming to agreement with your seller. Your expectations of the condition of that property will be a discussion point AFTER these general/specific inspections. At what point would you bail out to find another home? $500, $2000, $10,0000...
Here is the hypothetical; you are a buyer looking for a home to live in (not investor). And for this story we are NOT talking new/'to be built' but a downtown-central city house with some age on it. To make the offer you put down 1% earnest money and you have some additional money towards an "option period" (in Texas it is called 'termination option' section 23 of the paper work - a whole entry for this alone if you need more on 'termination option'). After securing the agreed to terms comes an inspection cost. Since your going to do the inspections on your older home purchase, at what price do you walk away over repairs or condition? There is not a "pass/fail" for inspections. This "pass/fail" is totally up to you the buyer. To be clear the general inspection is not the Appraisal with a capital "A"). The inspection results are relative to what you were expecting or not expecting . For the most part, the general inspector writes up a report relative to 'if the house was built today' highlighting code violations. Were you buying a turn key house which was marketed as a perfectly remodeled home? Did you expect some issues at the price you got it for? Does this house meet everything on your list plus more (an exceptional find for your goals)? Only you know the answer as the buyer and this is great information to share with your spouse/Realtor/self as part of the cost in making the offer.
If you decide to terminate the contract due to your initial inspections your 1% earnest money is likely refunded (reason for "the option money" I mentioned) and your only "out" about $100 to $500 depending on your terms for this "option money". The general inspection cost is about $300 to $400 with some variables we won't go into for now. Since a reasonable seller should be up for reasonable repairs on their dime, at what point is it worth walking away from your ideal home (which is why you put the offer down in the first place)?

swim team and house selling

2011-07-05T17:57:00.007-05:00

My 7 year old daughter showed up to her first ever swim team practice this summer. The city of Austin now requires all kids to show they can swim a length of the pool using free style and then another length using back stroke. The back stroke got her. It was a bummer for the both of us to leave the pool before the practice ever got started. She was "ousted" on her first day and it annoyed me and was a shock to her. I thought she would be enjoying her first day on her first swim team just like my memories of summer swim teams. Instead I was wondering what I did wrong to set her up for failure.
Selling a home can be a similar experience. The market is continuously changing. New homes enter the market with better pricing or better conditioning which under cut other homes on the market. The competitiveness of this market is not what many sellers experienced when they bought over 4 years ago. A seller can get a solid valuation on pricing but 45 days later it could need adjusting. The time on the market has increased over 20% so it seems like forever to get showings. Sellers need to be patient and be ready for a marathon not a quick closing/race. Buyers don't feel pressure to buy before someone takes a home they like. This translates into 2-3 days before making an offer AFTER seeing the property. Everything is slower. Even the response time in negotiating an offer is taking longer (and instead of closing a loan in less than 25 days, expect under 45 days). Then a seller sees other homes sell which they don't believe is as good of a comparable - "why them and not us". It is very difficult for a seller to objectively look at another competing house on the market. In my mind selling a home and my daughters swim team experience became connected.
We got together with my daughter and discussed a plan similar to a seller sitting down with a Realtor for a plan. She got a few private lessons just like a seller can hire a few private contractors for some "make ready issues". She made the swim team after those helpful lessons similar to a house making the 'top 3 list' of a potential buyer (the work pays off). My daughter adds a little practice to her strokes while enjoying a general swim just like a seller who cleans a little more than usual. Last Saturday was her first meet and like a showing she was ready. Her first meet did NOT end with a ribbon (win/place/show) but she will repeat the process and be ready for the next competition just like a seller should be ready for the next showing.

2nd Quarter importance

2011-07-01T12:53:00.007-05:00

First time buyers really benefit from getting to know the market they are investing in. Lets look at like a hockey game with 3 quarters.
------------
1st Quarter
------------
Start with building your team; Realtor and Lender. Your Realtor will outline the steps in the process from beginning to end and you will share your goals with what your looking for. Your Lender will privately outline the specific mortgage process as it pertains to you (without the Realtor).
------------
2nd Quarter (most important)
------------
You like what you have heard from the Lender in terms of the money involved and you have begun to use that information to receive updates on available homes to view through your Realtor. Unlike ever before you will be at a heightened sense of attention to the mortgage markets and houses for sale. If you hear about a mortgage scenario that was not discussed - call the Lender. If you see a home for sale outside of what you discussed with your Realtor - call your Realtor. I don't think a buyer is really out to find "THE HOME" but rather remove all homes for sale and narrow down the list and this is similar to lending (remove what does not pertain to you specifically). First you get to know the Macro Market of real estate for the city your in (don't try to connect Detroit to Austin for example). Next get honed in on a specific neighborhood you really like in the Micro Market sense.
-----------
3rd Quarter
-----------
At this point you have completed a team of reliable professionals to provide you service. You have been backed for a loan (pre qualified or even pre approved) and become an expert in what to expect for house prices through looking inside homes of interest. All the terms you agreed to do under your paper work with the seller are followed and at the end your a home owner.

Have you received good "2nd Quarter" help from your team?

Tearing down a house part 2 of 2

2011-06-30T17:03:00.002-05:00

Have you seen the Austin City Hall? It is described as "a unique landmark...", "...informality, friendliness, environmental sensitivity and innovative technology". I think it is a cool addition to downtown Austin wonder but wonder what the purpose is of the sharp angles on the north side. Is that good fung shui?
With all the grief the city of Austin gives to applicants for building permits AND all the rejections from numerous neighborhood communities / HOA's to new residential projects how did the City Hall get passed? I find parts of the City Hall's architecture so odd. If the city hypothetically passed this project I doubt the historic commission HOA would go for it.
Take a look, this city hall looks nothing like the structures around it built in 1880-1920.

Lets discuss this again...

2011-06-30T16:18:00.005-05:00

This is a repeat but so important and so necessary to discuss again and again.
In Texas, when you sell / buy a residential property there is likely a time period in the offer called "the option period". This consists of days given from the seller which is paid for by the buyer. An example is 7 to 10 days worth roughly 1% of the earnest money. This allows the buyer to perform their inspections and have leverage should something surprise them on condition (integrity issues of the house).
You start with the general inspector. Then if necessary you get licensed contractors (A/C, Plumbing) to follow up with issues the general inspector MIGHT have found. These general inspectors are not always accurate or correct. Their findings on specific issues could lead to necessary repairs. However their findings could also be wrong. Complete and accurate analysis of cooling/heating/plumbing should not be left to a general inspector. This is not a knock on the general inspector, they have waaaaay to much to inspect. Here is how these go down.
Go under contract Monday afternoon. Your Realtor gets from you the inspector to call or refers some to chose from. The general inspector visits the house by Thursday/Friday at the latest. The report is written and a copy is sent BUT THE BUYER SHOULD BE PRESENT FOR A WALK THROUGH / OVERVIEW OF THE GENERAL INSPECTION. Following the step of being present for the end of your general inspection you/the buyer will know who if anyone else needs to be called. You don't need to wait for the written report. Does the roof need further investigation? Plumbing? a/c? electrical? Being available to verbally go through the generally inspectors findings allows insight to the written report AND gives direction for your Realtor to call his vast supply of contracting resources to further answer the next round of inspections (roof-plumbing electrical). In this scenario you have calls to the plumber (as an example) who visits the house Friday-Saturday-Monday to finalize what issues might/might not exist. By Monday late afternoon you are either comfortable with the facts you have OR are in re-negotiations of the terms OR have specifically asked for an extension of the option time period. Extensions are possible but not guaranteed. The best chances of an extension exist when a seller learns of exact reasons or issues being further investigated.
As a listing agent I expect buyer/buyers agent to be using their time of this option period well. 7 days does not seem like a lot of time but with the right experienced Realtor and commitment from THE buyer principal all can be accomplished.

Tearing down a house part 1 of 2

2011-06-30T07:34:00.003-05:00

Some Austinites can get upset when they see a home with age (i.e. built around 1930 or so) get torn down. Sometimes this tear down can cause anxiety, with the thought process being the builder/person doing the tear down has just removed a perfectly good house and will now develop/build a new structure that will be ugly and not part of the original fabric of the neighborhood. The animosity and the level of distrust can reach obscene proportions. The concern is directed at architects, contractors, qualified buyers and basically the newcomer to this cool City. Those "some Austinites" could be wrong.
It could be possible that the reason this project (and future home to a tax paying Austinite) made it to the chopping block is due to condition. This property might be in need of being demolished so "they" could rebuild. If the previous owner neglected the home maintenance every home is due, than that previous owner chose to make this home a potential candidate for lot value only.
The next owner will help value in the area by taking a potential eye sore away and building a better home with better energy efficiency.
Oh, and this increases your bottom line as well.

Gas tank and showings

2011-06-27T12:05:00.003-05:00

Full time Realtors know how to use technology on their lock boxes to sell listings. A lock box used in my market area (to obtain key and enter a home) has infrared technology and retains the name of the Realtor, the Brokerage and exact time / date when the key was obtained for the showing. I can log into the software to view the showings and keep up with how many showings to date have actually used the lock box. On occupied properties the occupant normally receives the call to OK the access for showings. The data on the lock box activity is helpful since not all calls actually enter the home. Sometimes the buyer drives into the neighborhood and decides they do not even want to get out of there car to see the home. So actually use of the lock box is more important and useful than calls on the house.
When I notice a drop in showing activity, the seller needs to be notified because this could mean that its time to discuss two options; a repair / staging change or drop our price. The overall purpose of this is to get the seller where they want to go which requires a willing buyer. If i find out that 12 willing and qualified buyers came through the house and went on to buy another home, we could be out of the market. By adjusting a condition or our list price we will cast that wider net and increase our chances of achieving the seller goals. Remember I am outlining that 12 buyers visited the home so this is not about "more marketing for more people". We are getting our showings but these buyers are finding what they want elsewhere.
In a way, it is no different than filling our cars with necessary gas so we can get to our destination. We watch the gauges on the tank and react accordingly. The lock box activity is one gauge for selling a home. By watching the activity I could also hold off a price reduction if I see a second showing from the same Realtor.

one of the best stats in sales is ...

2011-06-25T14:54:00.005-05:00

one with enough of a trend line.
It is being reported that May of 2011 had over 2100 pending home sales (single family homes that have been placed under contract but not closed yet) which would be around a 53% increase from last May '10. Our market is in good shape considering what has been going on Nationally / Globally. Due to what is / has been going on I love seeing these numbers for pendings. However I offer caution when analyzing data that is too narrow (i.e. January 15 of '11 vs January 15 of '10 and even month of one year vs same month a year later). Trend lines of 6months or more are best.
This recent news of the 53% increase of sales in May is great. I think this story should also include an analysis of last years peak months during the tax credit of $8,000 for buyers. This fueled sales in March & April of 2010 thus reducing sales in May '10.
Again, these pending numbers are outstanding. I just don't like the way some stats are reported when one day or month of a year is compared to exact same day/month of a year later. Look for a trend of 6+ months when discussing the over all market & at least 3 months plus when pricing a home for sale.

Taste of my own medicine

2011-06-22T15:17:00.002-05:00

I went ahead and upgraded my cell phone from Blackberry to a Motorola Atrix. This decision has caused annoyances, pain, uncomfort, surprise after surprise. I was out of my comfort zone using this new phone and can't find things I would normally have located without even looking on my Blackberry (while driving). I lost my patience and sometimes it effected my whole day. I would wonder why I paid for this technology when it causes me all this grief. When I had questions the people at the cell phone store could not always give me exactly what I wanted (what I wanted is not always doable). Like real estate, the technology was sometimes ahead of the sales/service people at the cell store slowing down my needs.
Fast forward several weeks and I love my phone.
The learning curve was worth it and eventually I will do more with the new phone than my previous phone was ever capable of. The new phone now simplifies my day to day activities. I have even made friends at the cell phone store and when I walk in I get great service. I knew before embarking on the cell phone change that upgrading my phone was going to be a rough ride. I like my routine so I had to build up some patience and fake smiles.
I think this same experience could be a summary for house sellers and buyers.

The new option when selling

2011-06-21T06:37:00.005-05:00

Historically a listing appointment focused on 2 main objectives; what needed to be done to a home (staging) and the best price to list. These days in Austin, Tx., a seller should also acquire data on leasing their home.
Houses need staging to sell. Staging could be as simple as weeding the garden and mowing the yard. Staging a home could also be interior/exterior paint plus renting a storage unit for all the treasures inside. Houses also need to be priced correctly. Researching similar homes in school districts or neighborhoods or with similar features will aid in targeting the future buyer pool.
A 3rd category for a seller is the idea of leasing their home (not selling right away). It really is not all that new, but I have made it a question to ask when visiting with sellers. The market for leases is very active. A seller has a chance at a great pool of lease candidates who are paying top dollar. Preparation money to stage could be lower for leasing vs. selling. And if your house is in a market with a high inventory of listed homes or even a few foreclosures you might avoid a lesser sales price. With predictions of Texas doubling in size in 20-30 years your home could be a great investment property. Renting might not be the perfect fit for everyone (turning the homestead into a rental) but it should be a consideration when selling these days especially if your wanting to get these incredibly low interest rates.

today vs last year

2011-06-20T11:15:00.004-05:00

This time last year my industry was dormant - we Realtors should have just gone on a 3 month vacation. It was slow, quiet, brutally tough for an industry of people that like to keep moving/bouncing around. We had just come of the extended $8,000 tax credit. That tax credit absorbed many sales in future months. Additionally the rumors of it returning kept some people from buying. The take away feeling buyers had from the expiration of the tax credit was a surprise. Lets compare last year to right now.
Listings are lower - lower supply.
Solds in May are almost identical when comparing the '10 tax credit to '11 May (no tax credit) - 1,891 '11 vs. 2059 '10. Our current sales are similar to last year when a buyer would have a chance at $8,000!!
Median price is up nearly $8,000.
Average price is up nearly $25,000.
Simple economics 101; supply & demand.
Much of our demand is leasing. It was also in the 2nd Q last year when leasing became very popular. Newcomers are leasing and rates are rising $50 to $500 per month.
My stats are for the Austin area. Austin is one of the 117 or so 500 'major markets' which is doing well in comparison. Those that are buying now will appreciate what they did in the few short years ahead.
Buyers need to not shoot themselves in the foot when making an offer. I just had multiple offers on a home I have listed. They both started their bid at nearly 15% off list. Starting off there is not the problem, staying there is in this market. Be careful what you read and where it is based for your real estate data.

Keep it simple

2011-05-31T14:25:00.004-05:00

Following the acceptance of an offer you have 3 main objectives. Complete a general inspection with a state licensed inspector, get the contract to the lender and complete an insurance quote.
The general inspection can lead towards additional specific inspections/opinions like air conditioning or exact roof details from a roofer. Supplying your lender a copy of the paper work/contract allows them to lock in the interest rate. Without the actual contract a lender cannot lock a rate. And having a specific insurance agent (your own "go to" person for insurance needs OR a highly referred insurance expert from your Realtor or Lender) quote the rate on the exact house AFTER running a Clue Report.
These steps are all done during what we Texans call "the option period". One mistake is getting into the details of a remodel or decorating. There will be time after this initial "option period" for the details of personal touch. For now, focus on what matters most and don't confuse the natural anxiety around buying a home.
There are transactions requiring excessive work to be done and that might require a longer option period. For those houses that need a lot of work (these would be in bad shape and hard to live in under their current status) go for a longer option and still treat the initial 5 - 8 days as a first half focusing only on these discussed "3 objectives".

Big 3 from Major Applewhite

2011-05-26T13:24:00.003-05:00

I was invited to The Boys and Girls Club Luncheon by a friend (I call him "DR"). DR and his son are huge supporters of The Boys and Girls Club. What an awesome organization!!
Major Applewhite was the keynote speaker. He compared his goals/focus of coaching at a top university to that of the goals of The Boys and Girls Club. Both Major and The B & G Club have goals in supporting the development of young adults (on and off the field). He outlined 3 key words which are used in his coaching, and likewise interchangeable to the work of The B & G Club;
1. Trust
2. Communication
3. Respect
Major wants his players to trust the other team members. He expects communication to be a 2 way street and finally both coach and player need to respect one another.
These same 3 words could be used to outline the ingredients of a residential real estate transaction. Emotions run deep with housing. Housing transactions are different than a commercial or land deal even a 2nd home purchase.
The principals (buyer and seller) involved need to trust the Realtors-Lenders-Title Company-even themselves and everyone in between. Everyone involved needs to be able to communicate effectively during normal hours of business (and sober :)). Communication must be aligned with realistic expectations. Real estate transactions close because of a willing seller and a willing buyer. Once the 2 principlas come to terms, everyone needs to respect the work that needs to get done to finalize their terms of agreement. If a person involved (from principal to lender to Realtor) in the transaction has trust issues or a unique style of communicating or does not respect a role in the transaction the deal will experience severe ups and downs. In the end, the ultimate goal has the buyer living in the home of their dreams (which is why the buyer was looking to purchase right?) and the seller moving onto the next phase in their life (which is why they put themselves through the selling process right?).

Prayers

2011-05-26T13:13:00.002-05:00

A clients family lost their Aunt in the Joplin tornado. The woman was in her 80's. She and her husband of many years were in their home when the tornado hit. Susan's Uncle was found in the hospital, he is 87 years old. They were unable to find their Aunt until Susan's sister flew in from Denver to do a search. They found her Tuesday in the ruin that had been their home. A very sad ending. The family is now trying to figure out how to take care of the Uncle who is expected to live from his injuries. Everything was lost in the strom. How do you start over at 87??
Thoughts and prayers go out to Susan and her entire family.
With the emotions surrounding a residential real estate transaction news like this centers us all on what is most important.
With so many cuts to our state and federal budgets we all need to help Red Cross & other like minded groups supporting these devestated areas by flooding/tornados/wildfires.

Wonderful Lot in Central Austin, now what?

2011-05-17T06:19:00.003-05:00

I came across a great article from Don R. Hancock who is a partner in Hancock & McGill, L.L.P. attorneys at law. He shared a response to his clients desire to build a home on a vacant lot they bought. In his letter he explained how environmentally conscious Austin is. The city has these protections to retain much of its natural beauty and help make the city a desirable place to live. On the "other side" of this discussion these same protections increase the expense and exact a cost when developing a property, demolish and re-build in the central part of City of Austin. Here are 6 steps to research;
1. Lot Status - is it a legal lot? what needs to be done to make it legal?
2. Historic Preservation - expect additional time for your project (75 days)...
3. Restrictions on Home Size - 40% of lot size with additional respect to #6 below
4. Tree Ordinance - start measuring and line that meeting up
5. Zoning - don't be surprised
6. Building Setback - know your set backs, get a current survey ordered
There are many issues which affect the ability to construct a residence in Central Austin. When preparing an offer work with your Realtor and consider calling Mr. Hancock.

Part 2 Home Inspections

2011-05-06T18:59:00.002-05:00

The last sentence on part 1 caught my attention. I always understood home inspections in Texas to be an investigation of code violations in addition to other investigations of the improvements to the property.

These inspections can be overwhelming. I think I have listed areas to inspect on previous posts and I will possible be repeating myself. Here is a list of inspections;
1. general inspection from state licensed inspector
2. wood destroying
3. pool/spa "opinions"
4. septic (pumping then investigate)
From the above you can then proceed to another round;
1. pressure test of plumbing
2. structural engineer
3. mechanical (A/C & Heat)
4. electrical
5. roof
Finally you might end up getting bids on;
1. specific repairs of tile, new flooring, painting, windows, driveway/masonry, gutters, new light fixtures, new appliances, new counters, etc. etc..

Home Inspections part 1

2011-05-06T18:55:00.002-05:00

What is the definition of a home inspection? Wikipedia has their definition quoted below my posting. Over the years my industry has matured with issues like Agency, Disclosures, Options vs Earnest money. Another such area is the clear distinction between a Realtor and an Inspector. After the following, go ahead and read the definition of a home inspection by Wikipedia.

Buyers desire to own their own home, Sellers need to sell their home. Realtors aid in establishing market value for both scenarios either by showing homes to buyers or discussing the market conditions at any given moment with buyers and sellers. Once a home is "found" by a buyer, their Realtor assists them with the process of offering, negotiating and closing the home. A fundamental guideline for this process is the buyer wants the home. If the buyer decides the home is not for them, they can not make the offer or utilize one of the "outs" created by the offer they made with their Realtor. During the "under contract phase" of this process; a buyer will have professional people performing exact steps and offering opinions (Lender, Surveyor, Title, Inspector, Appraisal, specific Contractor). Lets focus on The Inspector.
The Inspector and the Realtor are 2 seperate profesional occupations in Texas both licensed by The State of Texas. Inspectors don't discuss sales and Realtors should not discuss durability-integrity-conditions of improvements. A Realtor could and should discuss what upgrades are worth in the open market of a home sale. A Realtor could also help create a plan with a written Home Inspector's report in making an offer or countering an offer with an active option period. Realtors know how to negotiate the steps in a home sale, that is what we do. When an inspection is in process it is best to have the home empty of the seller owner. Just the inspector and buyer should be around. This simplifies who says what and really frees up the buyer to get their money worth with their inspector by asking questions and learning about their home. We Realtors are a talkative bunch. We see a lot of inspections. We get immune to what an inspection could mean to a buyer, especially if that buyer is first time OR has not bought in 20 years. I would also warn adding decorating ideas during an inspection. A list of inspectors findings in addition to a list of personal preferences could really confuse the entire process. Even under short option periods, a buyer should first to inspections THEN proceed to personal preferences.

Wikipedia...
"A home inspection is a limited, non-invasive examination of the condition of a home, often in connection with the sale of that home. The first known home inspection company, Home Equity Loss Protection Services dba/H.E.L.P.S.(Glen Ellyn, IL), was originally founded by Christopher P. Nolan and Loyola Professor Mark Goodfriend. Years later, the company was officially incorporated in the early 1980's by Jane Garvey, surviving wife of Professor Mark Goodfriend in Glen Ellyn, IL following its purchase from Christopher P. Nolan, the founder of the home inspection business and entrepreneur. Mr. Nolan was inspired to create a comprehensive system of home inspections because as an investor of distressed real estate and then a nationally recognized real estate expert and speaker, he realized a need to have skilled professionals inspect key areas of the home prior to his purchases in order to mitigate the risk of his investments. Home inspections are usually conducted by a home inspector who has the training and certifications to perform such inspections. The inspector prepares and delivers to the client a written report of findings. The client then uses the knowledge gained to make informed decisions about their pending real estate purchase. The home inspector describes the condition of the home at the time of inspection but does not guarantee future condition, efficiency, or life expectancy of systems or components.[1]
An inspector will check the roof, basement, heating system, water heater, air-conditioning system, structure, plumbing, electrical, and many other aspects of buildings looking for improper building practices, those items that require extensive repairs, items that are general maintenance issues, as well as some fire and safety issues.[2] However, it should also be noted that a home inspection is not technically exhaustive and does not imply that every defect will be discovered. A general list of exclusions include but are not limited to: code or zoning violations, permit research, property measurements or surveys, boundaries, easements or right of way, conditions of title, proximity to environmental hazards, noise interference, soil or geological conditions, well water systems or water quality, underground sewer lines and/or waste disposal systems, buried piping, cisterns, underground water tanks and sprinkler systems to name a few. A complete list of standards and procedures for home inspections can be found at the NAHI, ASHI or InterNACHI websites.
A home inspector is sometimes confused with a real estate appraiser. A home inspector determines the condition of a structure, whereas an appraiser determines the value of a property. Although not all states or municipalities in the U.S. regulate home inspectors, there are some professional associations for home inspectors that provide education, training, and networking opportunities. A professional home inspection is an examination of the current condition of a house. It is not an inspection to verify compliance with appropriate codes."

Garage or "Cooled" space?

2011-05-05T06:19:00.006-05:00

Looking at a home with a converted garage or other recently added space(maybe porch)? Have you converted your garage? Central Austin has a ton of converted garages into living rooms and bedrooms. Increasing the size of small cottages built in the 30's and 40's for better closets and storage has been popular. Depending on the market here are some considerations in pricing if you are a seller or a buyer. Scope of the conversion is instrumental in market value.
Seperate the original square footage from the converted garage space (this can also work for converted porches and other spaces incorporated into the heating / cooling of the house that is noticeable). Typically a 2 car garage is around 400 square feet. If the "original" house was 1600 square feet, with the converted garage we now have a 2000 square feet home. The original 1600 sqft tends to have a higher valuation per foot than the converted space of 400 sqft. Too often, a home is listed at the peak of the market for the area using all 2000sqft.
This can work when having trouble selling your own home or wanting to establish a method of pricing to make an offer. Of course market conditions apply. If you are selling in a buyers market the pricing of the converted space could be lower than higher. Buying in a seller market could mean inventory is low and you don't have many options.

"Price per square foot..."

2011-05-05T05:56:00.005-05:00

There are many methods to analyze the value of real property. A common practice is to discuss price per square foot. That is one good tool to establish a value however it should not be the only one. How big is the lot? How is the landscaping? How many trees and what type? What is the lot like? Overall condition of interior/exterior? Who designed the house? How good or bad is the floor plan? What is going on with the school district? What amenities are found within walking distance? How is the overall street where this property is located?

There are times when price per foot answers enough questions to make the offer or price the property. However the use of "price per foot" is often the only 'system' used in pricing and there could be more to it.

If you are a buyer and have seen a lot of properties for sale you know valuations better than the future Appraiser.

Just business, not personal

2011-05-05T05:48:00.008-05:00

A huge advantage to working with a real estate Agent (Realtor) is having the Agent buffering the personalities of the parties involved. If you have chosen your Realtor through careful consideration you should have somebody you know and trust - highly referred. The Buyer gets to talk directly with their preferred Agent and the Seller discusses their business only with their desired Agent. This could be one of the top values in having a Realtor involved with the transaction that goes most unnoticed, rarely discussed.

A willing seller needs a qualified buyer to purchase and complete the transaction. This sounds simple enough only people are involved, highly emotional people. The seller wants to sell, the buyer wants to buy. But what happens if the two parties don't personally get along? What if they have some fundamental differences and "would never hang out"? This matters little to the business of buying/selling real estate. The Realtors do this work on a regular basis. If a seller or buyer has not moved / bought a home in 20 years, the principal is going to be WAY out side their comfort zone. Their ability to trust the Realtor will be key to their own sanity during the process.

Choosing your professional Agent (Realtor) is the first step, then getting out of your comfort zone to trust that Realtor to do what they do is next. This scenario keeps communication in a professional order and reduces confusion. I am not saying it eradicates confusion (remember, people are involved) but it does help.

Traffic Solutions

2011-04-24T10:27:00.004-05:00

I was just channel surfing and came across a city council meeting. Their discussion was the new rail system. I started thinking of 4 ideas I wish their discussion would turn towards;

1. create an upper deck that was actually non stop along Loop 360 (imagine a true 'Loop' where it is already named a 'Loop'). This loop would provide 'north south/south north' movement for all cars/trucks and a rail line could be installed at the same time.

2. go back to the owners of the Missouri Pacifc rail line running on boths sides of Loop 1 (another non loop that is named a loop)/MoPac ("mo" coming from Missouri and "Pac" coming from Pacific) and beg to take them up on their earlier offer (years ago) about using that line for a transit system. They offered years ago and nobody followed up on it - so the story goes....i think today there are new owners of this line.

3. round up all urban area Home Owner Associations plus the Historic Commission. Get this entire body of Austin Citizens to agree to allow more flexible terms for business to open up in our historic neighborhoods so urban area residents can walk to a restaurants & other shopping. We don't need to go over the top like Houston, but just a little flexibility in this area could reduce traffic, noice polution, use of gas, allow for some exercise....maybe even allow some duplex construction to assist in the declining elementary school population.

4. talk to the operators of the Zilker Zepher, they seem to know how to run a profitable train (this is borrowed from a radio show I was listening to and a caller who offered this suggestion). Seriously though, make the transit system fun for kids and help get the word out "referral style"

What to do with my paid for house...?

2011-04-21T15:38:00.006-05:00

When owners of real property who are close to retirement call a Realtor it is not always about selling/listing immediately or in the next year. Sometimes the owner just wants to begin the discussion of "what to do". The owner has a significant position if they have owned the real estate for a long time & it is paid for. Knowing what to do often begins with what the real estate is worth and then what could be done with that capital if the property was to be sold. Here are some conversation points when you or a family member has lived in a home or owned real property long enough to pay it off AND the conversation turns to what could be next;

1. do you want to stay in the house forever (leave the house feet first)? what areas of the home are "tricky" and need some modifications for safety and ease of moving about the house...

2. is the house keeping you from something you have always wanted to do (travel, move into a high rise loft in your downtown, move closer to family living in another location)? further down might be an answer in #8

3. are you worried about a looming repair (major roof work, wood rot)? get bids, might be lower than you think

4. have you always wanted to fix the house up a certain way with new appliances and energy saving modifications to reduce monthly bills (this brings up #8 on this list again)? have a Realtor referr a great builder who will discuss options without pressure to take immediate action

5. can you rent the property out and also move on to the next phase of your life? Keeping the asset of the real estate and travel-move closer to family (property management is possible at around 7-9% of rent each month)

6. is enough money tied up in the equity of the paid for property to make a difference (going back to #2 above) in retirement if you decide to sell?

7. could you be creative and build a rental on the property for monthly cash flow? is the lot big enough for both your residence and a rental producing property?

8. do you have a referral to a Reverse Mortgage lender? don't disrupt your life and move, stay put and get your money while you need it.

9. would your neighborhood allow you to cut the house in half for a duplex? this would allow someone to stay in their home while also reduce costs to generate income. Don't do anything but add a kitchen and seperate the house into 2 units.

10. how about a roomate? is there that perfect person who is dependable, reliable to generate monthly income but reduce expenses to do so?

Get together with your financial planner, CPA, Banker and get sound advice based on personal goals.

Don't fall for this one from my industry "I have a buyer"

2011-04-21T15:29:00.005-05:00

I hear about this one roughly 3 times a year from clients. The scenario is a home owner or owner of real property has recieved a post card from a Realtor which says, "I have a buyer for your home".

It just ain't so. If they had a buyer, the owner would be getting a phone call. Similar to a bank needing to talk to you about important changes with the account, we Realtors want to talk to you quickly when we have someone interested in buying your home. We don't want to wait for 3 or 5 days on the postal servcie to see if you will call us about our 'interested buyer". When I have a buyer desiring a home not on the market here are a few action steps; a note left on the owners door, a phone call to owner or multiple people in the area to track down the owner, a one time listing agreement for this one buyer, a fully written offer sent to owner.

The listing agreement is important because it defines certain aspects to the transaction. I don't believe it needs to be a formal relationship of agency representation (i.e. seller is represented by any Realtor) but it clarifies some important dates and responsibilities that need clarification.

The post card or letter from a Realtor which says, "I have a buyer for your home" is a technique to get a listing appointment and be the agent for the home owner. If you like working with strangers call them and set up a time to talk. If the postcard got your interest up call your preferred Realtor and learn a little more.

Staging made simple

2011-04-21T14:56:00.003-05:00

I was viewing a large number of homes yesterday. All of the properties were still 'for sale' and not 'pending' or 'sold'. There was a real trend in these properties that had not sold yet- the lack of preparation and buzz word of 'staging'. I think the actual work of 'staging' is an art. Knowing exactly the best fit for furniture and chosing the best colors is a skill left for designers. My focus today is simply being prepared for the buyer every single day your on the market for sale. This is not easy and another reason why pricing it to sell in the 30 or 60 days is so important (and not just so a salesperson can make a commission). If I were to give feedback to each of the homes I saw yesterday here is what would be said; "clean windows, freshen up the smell, remove weeds in the driveway/walkway, clean up the flower beds, freshen up the paint in/out, remove extra furniture, reduce photos of all your kids/family/wedding day (and just have that one favorite of each), clean up the dead bugs, throw trash away in each trashcan, get a new shower curtain and make it one that is very simple, deep clean your oven (and know buyers will look into your frig), hang your garden hose on a designated rack near the faucet, power wash the old deck, find a place other than the house for your barking dog (realize your quiet dog will freak potential buyers out), take away the old outdoor swing that looks bad (even though the kids love it).
The alternative would be to just sit on the market, make payments, be asked to reduce your price until you have fired multiple Realtors and conceed to actually do the above or reduce your price or both.

The most important of the 3 "first impressions"

2011-04-09T07:56:00.004-05:00

Everyone knows of the importance in the 'first impression' and how small of a window they can be. This principle ranges from personal meetings to showroom floors. The platform of the house listing as a showroom floor is my focus. When you put your house on the market be focused on all 3 of these first impressions. 1st impression - picture and content on line. What is the main picture? The very first picture should be of the front otherwise buyers/viewers will wonder ''what is wrong? why is the front of the property not shown?". I listed and I have seen other listings when the main feature of the property is the back yard (extensive landscaped pool, view of downtown). It is a great idea to put some time and capital in staging the entry of the property; landscaping, painted front door, clean windows, removal of the solar screens and power washing are some examples. 2nd 'first impression' - the drive by. The potential buyer is might have been referred by one of your neighbors OR seen internet marketing OR just driving by randomly. Our 2nd impression takes us back at what the buyers will see from the street while in their car - the front of the house. They are not going inside at this point, just driving by very s-l-o-w-l-y. This is also where they will cruise the neighborhood and your pricing will be important. 3rd 'first impression' - the buyer has viewed pictures of the property (flyer, email, internet tour), driven by and is now about to walk inside. You have worked on the exterior front, your Realtor has supplied marketing which captures images of the property and verbalizes its attributes, now the last 'first impression' is upon us.... How is the lighting? Change out all lightbulbs for the brightest OR the best lighting for the house. Open up all window coverings because natural light shows the square footage. What will their sense of smell register? Hopefully not any pet odors nor smoke odors. It is best to avoid general plug in scents and best to just have your "showroom floor" smelling like a clean home (a great referral is Pine-Sol and Bleach). Have you "staged"? Have a garage sale and make some $ to fund additional staging. Your Realtor will have some great advice. Your favorite store "stages" (from Nordstrom to Academy) and so do the most successful Hotels so you should as well. Respecting the 3 first impressions will increase your chances of selling for more and at a faster pace to reduce carrying costs. This is especially true if the buyer has to see the entire property or every room to really "get your homes value". Get the buyer excited at each of the 3 first impressions and you will soon be out of your home.

Buyers Best Friend - The Option!

2011-04-08T08:11:00.002-05:00

Found that perfect home but still have a number of important questions? Don't want to make the offer until you get those answers? Here is your best friend for this scenario - The Option. If you walk into that one home and begin to see your furniture in the rooms plus areas to host friends/family go after it with an offer. Don't wait around for the answers to remaining questions, formalize the price your willing to pay (or start with as the initial offer if you think the house is priced too high). Your Realtor will assist in the data to hone in on the numbers of your offer. "But what about the remaining questions?" In Texas you can create your offer with an option period which takes the property off the market upon an agreed to set of terms (price, close date, etc.). I use and see a lot of 10 day option periods. 7 days work, less than 7 can be more common when the market is more "seller friendly" or your competing with another buyer (0 days in a red hot seller market). For those properties that have a ton of issues go over 10 days and explain why to the seller, i.e. "I need 12 or 14 days to do the normal inspections and Q&A/processing but also spend time with a contractor or repairman". Using the option period really helps capture the home you like so nobody else gets it. Then you can begin to learn about those easements, approval of a pool, what is the zoning, how much something relating to owning the home will cost. If you discover information that changes your mind about the property, that option allows you a time period to re-negotiate or cancel the offer AND you get your earnest money returned.

New Construction and Value of your Realtor

2011-04-04T19:45:00.003-05:00

If you are thinking of building a home (custom or high volume builder) lean heavily on the services of your preferred Realtor! This is not the scenario to venture into a real estate transaction without your Realtor, quite the opposite. It is so easy to 'walk' the site during construction and have a conversation with the builder or builder rep regarding an upgrade which gets lost at the end. And while you are crazy busy working hard to fund this new home it is super easy to lose track of time and forget to schedule that 'phase inspection' you want done on the foundation or rough plumb. Having your good preferred Realtor there throughout the process supports documentation and procedural aspects to construction of a home. Having a paper trail for those promised upgrades is vital. And if there is situation that requires a re-negotiation what better person that your preferred Realtor to help. The Builder gets so overwhelmed with the details and without bad intention can forget what was promised. Last, DO NOT CLOSE UNTIL YOUR FINAL PUNCH LIST IS SATISFACTORY! Do not go to closing and sign the closing documents unless you are ok with what is remaining. If this list is short and simple and within reason, just be aware it might never be attended to. And if the final 'touch ups' / repairs do get attention, is is possible to not get the best of service or work AFTER you have funded the project. This is not a shot at the builder, they get swamped and over whelmed with all the details of the new homeowner (and they have just a few emotional home owners).

New Home Construction & Value of your Realtor

2011-04-04T19:36:00.005-05:00

Building a home (custom or "large volume" home) and discussing the details without your Realtor present is not a good way to utilize your Agent. This leads to a ton of issues that rarely get worked out and leave a bad taste in the mouth of the buyer principal. If your looking at building a home, lean heavily on your preferred Realtor. Every step of the process needs documentation. Work orders, modifications, future promises on upgrades, notifications to inspect at a given level of construction all fit into the type of thing a good Realtor does throughout the escrow. It is a good idea to check on the progress but getting into a dialogue w/out your Realtor knowing about it (and documenting the discussion on paper with signatures from both builder and buyer) can lead to trouble at the end.
Last, and this is huge for you first time buyers - DON'T CLOSE UNLESS YOUR HAPPY WITH YOUR FINAL WALK THROUGH!! If you are certain the items on the final punch list could be left incomplete and you would be ok, go to closing and fund that project. BUT if there are still some relatively large 'to-do's' on that list do not fund the closing. Go ahead and digest having that Thanksgiving Day meal at Luby's (a local cafeteria) or paying the extra sur charge at the rental property. If you truly want it done and done right, hold your ground and wait to close. You will get everybody and their proverbial dog focused on your home.
In a new neighborhood with a high volume of homes being constructed, the "Super" (lead General Contractor of all construction) gets so overwhelmed with all the details. Having knowledge of what was written and agreed to plus any heads up on poor workmanship helps him and the rest of the neighborhood.

Free sports entertainment in ATx.!

2011-04-03T12:29:00.002-05:00

If you like football, especially college football, and your in Austin, Texas today your in luck! The Longhorns host their final spring scrimmage open to the public. Even if you are interested in another team this is still Division 1 football. Festivities for the kids started at 11:30am and actually practice begins at 2pm. This is a great way to kick off the 160+ game prof. baseball season! Across the street from the stadium is a great museum, Texas Natural Science which is also free and great for kids. http://www.utexas.edu/tmm/

Sources for Values

2011-04-02T18:25:00.000-06:00

Worth Monkey is a good site for checking gadget costs. Just enter the gadget you want to sell. The site will comb other sources to determine the current price. You'll be able to select a competitive price quickly. It's also great if you're thinking of buying used gear. http://worthmonkey.com/

Laguna Gloria Art Museum - location location location

2011-03-28T05:52:00.003-06:00

If you have not toured Laguna Gloria in Central Austin this would be a great referral to enjoy. "Laguna Gloria" means 'beautiful lagoon' and was donated to the Texas Fine Arts Association by owner Clara Driscoll (yes - connected to Austin's famed Driscoll Hotel). Once you are on location the naming of this place will be clear. I have enjoyed taking many photos of my kids throughout this properties grounds. Very quiet and a ton of real estate to stroll around and enjoy.

For the visual / kinesthetic

2010-06-23T10:23:00.002-05:00

Check this out! We've talked for a couple years about how Austin and the surrounding counties continue to grow. This paints quite a picture I'd say. The formula is pretty simple for a strong housing market. Job Growth ~ Income Growth ~ Quality of Life

http://www.forbes.com/2010/06/04/migration-moving-wealthy-interactive-counties-map.html?preload=48453

We have low interest rates, high inventory of homes to chose from, around a 2% decline in average prices for our Austin Metro Area. If someone you know is deciding to "wait" to buy, they should reconsider.

AUSTIN NAMED #1 BEST CITY FOR NEXT DECADE BY KIPLINGER

2010-06-22T19:22:00.001-05:00

Austin is the best city for the next decade according to Kiplinger magazine, whose research focused on innovation and growth potential among U.S. cities. Austin edged- out some tough competition for the accolade, including Seattle, Wash. - widely known as a mecca for smart people and great ideas. So, what put Austin over the top? The magazine states that Austin has an elusive third element, collaboration. In addition to our educated and creative workforce, we have healthy business networks, a dozen venture capital funds, a proactive city government and, of course, lots of live music. Read the full article….
Now lets bring on the jobs not just talk about the potential!

2010-06-02T14:35:00.001-05:00

PENDINGS VS. ACTIVES...The number of homes that went pending (aka "under
contract) during the past 30 days, is a great indication of what the current monthly demand is for homes in your neighborhood. For example, if your neighborhood currently has two homes that went Pending in the past 30 days, then two is the monthly demand in your neighborhood.
A savvy agent and seller will put this information into perspective by comparing this monthly demand to the number of Active listings (the supply). For instance, if your neighborhood has twenty Actives and two homes have gone Pending during the past 30 days, then it's reasonable to assume that only the top 10%, in terms of best overall value, will sell this coming month.
Stage and price your home with this statistic in mind to ensure that you reach your goals within your ideal timeframe. And, continue to revisit this statistic while your home is on the market to find out if your neighborhood is becoming more or less competitive.

2010-05-30T08:35:00.000-05:00

For those of you who haven't seen it yet: AUSTIN is #1 on the latest Top 10 list. Kiplinger.com just released the results of their latest search for the top cities in the US. The article gives Austin the prime spot for the top city to be in for the next decade.
1. Austin, Tex. Austin is arguably the the country's best crucible for small business, offering a dozen community programs that form a neural network of business brainpower to help entrepreneurs. Now overlay that net with a dozen venture-capital funds and 20 or so business associations, plus incubators, educational opportunities and networking events. Mix all these elements in what many call a classless society, where hippie communalism coexists with no-nonsense capitalism, and you've got a breeding ground for start-ups.
Don't discount the fun factor: In the self-proclaimed live-music capital of the world, music and business creativity riff off one another. The city's famous South by Southwest festival, where concerts, independent film screenings and emerging technology overlap, is a prime example.
To see the full article please click on the link: http://realestate.yahoo.com/promo/10-best-cities-for-the-next-decade *********************** Tomorrow, May 31st, is the last day (for most) to file a protest with the Appraisal Review Board concerning their property taxes for the current year. For more information on the ARB and protesting your taxes, please go to the following link:
http://www.traviscad.org/arb.html To download a protest form: http://www.traviscad.org/pdf/2010Forms/ARB/50-132_NoticeOfProtest.pdf *********************** 2nd Street renamed for Willie Nelson By Sarah Coppola Thursday, May 27, 2010, 10:55 AM , Statesman.com Part of Second Street will now bear the honorary name Willie Nelson Boulevard. The City Council approved the change this morning as a tribute to the singer, who has lived in the Austin area nearly 40 years and sold more than 50 million records. The city will install Willie Nelson Boulevard signs this summer at every block along Second Street from Trinity Street to San Antonio Street. The formal name, mailing addresses and street signs for Second Street will stay the same, but residents and businesses along the street will be able to receive mail using the Willie Nelson Boulevard address, said Mayor Lee Leffingwell, who proposed the idea.

2010-05-24T12:49:00.001-05:00

author unknown -
Worry and confidence

"If you're able to worry, you're also able to be confident. Because from a functional standpoint, worry and confidence are pretty much the same thing.Worry is the expectation that something negative will happen. Confidence is the expectation that something positive will happen.How do you create confidence about something that hasn't happened yet? You use the exact same process you would use to create worry.The big difference between worry and confidence is the expected outcome. And the powerful fact is, you can expect whatever outcome you choose.There's another way that worry and confidence are quite similar. They both tend to be self-fulfilling prophesies.So instead of destroying your effectiveness with worry, you can vastly enhance your effectiveness with confidence. It takes nothing more than a simple yet powerful change in your expectations."

2010-05-20T09:02:00.000-05:00

BASICS: Our economy is a consumer driven system so when consumers slow their discretionary spending the economic engine slows as well. In early 2008 Texas sales tax (that 8.25% tax we pay for clothes & uncooked food, etc.) receipts turned negative in a year over year comparison. This trend continued for 22 consecutive months ending in January 2010.

RECENT HEADLINE: The State of Texas recently forecasted an 18 billion dollar deficit (keep in mind our legislature meets once every two years). This deficit is related to the 22 months of sales tax decline.

BLOG FOCUS: In February & March of 2010, Texas posted 2 consecutive months of sale tax revenue increase! Austin alone had 5 months of sales tax revenue increase! Keeping up with the sale tax revenue is a great gauge on 'consumer confidence'. University of Michigan does a monthly posting on National Consumer Confidence and our Texas Sales Tax Revenue could be one way to look locally at ‘Consumer Confidence’.

Let’s all hope we are going to continue this trend of sales tax revenue in Texas + Austin + see it nationally!
Oh, and it might not hurt that Texas has around 1,500 newcomers PER DAY! Austin is supposed to see about 500 to 800 per week moving here

2010-05-18T07:25:00.000-05:00

Sellers are going to pick their Realtor either through a referral, a past experience or a “cold lead” (i.e. internet, open house). I think Sellers in any type of market condition but especially this market are best served through a Real Estate Agent that has a high level of Character & Competence. With Character & Confidence honest and frank conversations can be exchanged between owner and Realtor and can really improve the success in selling a home. I don’t believe these honest and frank discussions have any merit if the owner does not truly trust the Character and Competence of their Realtor. And how would they if they don’t know the Realtor? This market is a beauty contest and price war.
It might be true for most relationships that being ‘kind’ is better than being ‘right’. However, with listing-selling-marketing a home chose your Realtor on the foundation that he/she will be having frank & honest discussions to get your home sold. Living in a home is very different than selling a home and with ‘honesty’ over ‘kindness’ you will be well served.

2010-05-06T09:20:00.002-05:00

Distressed properties (short sales, foreclosures) generally comprimise about 7% or less of the entire sales in the Austin Area. They almost always are in below average to poor condition with some exceptions. Additionally, this aspect of our market will usually be located in Suburban areas, thus not so much an option for Urban Homestead Goals.
If Suburban markets are of interest, new homes can be very competitive since the condition and cash out of pocket for these distressed homes is very likely. The time to actually close taking ownership is 2 - 4 times as long as a 'normal' sale. Lastly, there is a ton of professional competition (investors) who are also looking to buy them with cash. When banks have an option for a cash offer or a low down payment (higher loan to value) offer, cash could win out in buying these distressed properties.
So unless you are OK with these obstacles distressed properties are probably not for you & at the very least should only be counted on in 10% of your pursuit for a Homestead.

2009-09-20T15:12:00.000-05:00

Sellers need a Realtor that will do more than just market their home. The Realtor needs to listen and listen well. The Seller needs to be free to ‘talk’ as emotionally as they need. Moving out of a home is not the same as moving out of an investment property. Kids could have been raised, money could have been invested in personal features/remodel and many memories could be left behind. Sometimes an equity loan was used years before which could deplete the cash return once sold. Important for Realtor and Seller to discuss are “why selling”, the market will not pay a price simply b/c the seller has a need, but knowing the reasons can help with private discussions. When negotiations are under way with a prospective buyer on a home, the seller needs to discuss what is on their minds with their Agent (Realtor). In return, the Realtor cannot take anything personally nor share any of the private discussions they are having with their seller principal (of course not sharing with the other side, but also with friends/family). A goal every Realtor should have is creating an environment for the seller where they will not feel uncomfortable asking any question or stating their level of concern. Market data supplied to the seller is a key factor, but being able to explain the data and listen is even more important. The Realtor needs to make sure and focus on the concerns of the seller. How to respond to an offer? What can the seller know to respond but not risk losing the sale over their counter? What is the market doing? Would this offer demonstrate a new low in terms of a sale or average or high mark? What percentage return is expected on average for the remodel work done to the home? What would be the appreciation of the home if sold at a certain price (i.e. selling after buying 5 years before)?
Everyone handles themselves different and that is one ingredient that a person must appreciate if they want to succeed at representing others as an Agent/Realtor. Discussing a decision several times might be very helpful. It might take either the principal seller or the Realtor several times to realize the help being asked. Sellers “…don’t want to be the worst client for their Realtor” and the Realtor should always hope the seller appreciates the work done to market-sell-close the property. I hope a seller understands it is all a process and never easy. Just as an attorney or doctor has ‘client confidentiality’ so should Realtors.

2009-09-13T08:15:00.002-05:00

Lots of buyers are entering the market driving the volume of sales. The number of sales in July for metro Austin, Texas, reached the same of July 2008. Jan.-Feb.-March-April-May-June all showed sales to be 20-25% lower than 2008, until July. I want to focus on buyers who are entering the market for the first time AND buying with a partner-husband-wife.
Of course buying is easier if there are two incomes for the qualifications. But when buying with your spouse or partner, you have to work as a team and teams have plans. For example, with a married couple the wife needs to create her list seperate from her husband (and vice versa). This list needs to have the first 5 most important items if a person was to agree in buying a home. Each person needs their own list starting with #1 - #5 in order of preference - the preference of the creator (and seperate from what a parent, kid, friend, and especially the person your buying with). Once each person has their list of 5 (#2 is more important than #4), and then extends the list to items #6 - #10 in order of importance. The key is realistically having the first 5 goals for the property be "must haves that won't be negotiated" and #6-#10 be "hope fors but dont' have to have". Finally, and maybe with an adult beverage of choice, the couple needs to sit down and agree on 1 list highlighting their desired house. Don't trash the individual list, this is helpful later.
This process will help improve communication when properties are being toured. Buyers should give themselves room to change. Over time an item can become more or less important and shift on a personal list. When this happens, explain to the partner "...my #8 is now more important and sits at #3, can we agree?" Buyers must be able to change their direction and be communicating it to one another. I want to stay away from listing any criteria, but will add price is often overlooked on the first 5.

2009-09-08T10:44:00.003-05:00

Nice to be back, my son is 10 months old now and for some reason I have not posted an entry in about a year.
One aspect which is often overlooked in residential real estate is time. Some of the changes that have taken place since last fall '08 (first noticed in fall of '07) are noticeable - price and an increase in the number of homes available. When the inventory of homes for sale increases, the entire sales process becomes longer. It is longer for the buyer to understand the market - more homes to see to formulate an opinion. It is longer for the right home to be found since the buyer has more to chose from and naturally adds more to their expectations (the buyer does not have to settle for less, they will just keep looking until they find everything they want). All of this is applicable to anytime a real estate market shifts to a ''Buyers'' market. One addition of late is the lending process.
Now, loans need about 45 days to close. From the time a property is found to the date it officially changes hands, one can expect 45 days. Prior to the last 6-12 months, I would quote 20 to 30 days but not now. I am also assuming the buyers have done their necessary pre qualification well before finding their home. In summary of ''time''; the buyer takes more time to find the right home, the seller needs more patience waiting for the buyer, the lender needs more time to process all loan requirements.

Austin Driving Guide

2008-06-12T12:47:00.002-05:00

I found this rather amusing. Special thanks to Alamo Title for hunting this down.

Rules of Austin --- Forget the traffic rules you learned elsewhere. Austin has its own set of rules....

1. All directions start with "Go down Mopac...'cause you don't want to get on I-35."
2 Burnet Road, Braker Lane, and Lamar Blvd. have no beginning and no end.
3. It is impossible to go around a block and wind up on the same street that you started on. The Chamber of Commerce calls this a scenic drive.
4. The 8:00 am rush hour is from 6:30 am to 9:30 am. The 5:00 pm rush hour is from 3:30pm to 7:15 pm. Friday's rush hour starts on Thursday morning.
5. If you actually stop at a yellow light, then you cannot be from Austin. You may apply your brakes when the end of a yellow light and the beginning of the red light create a burnt-orange hue. This is Longhorn Country, after all.
6. Just remember that Mopac is Loop1; Capital of Texas Hwy is 360; and US 183 is Research Blvd., Anderson Ln., Ed Bluestein Blvd., and Old Bastrop Hwy; 2222 is Northland Dr. or Allendale Rd. or Koenig Ln.
7. If moisture is determined to be rain, and not sweat, al traffic must immediately come to a screeching halt.
8. DO NOT attempt to access any road during an apocalyptic event like snow or SXSW or the ACL Fest or any one of the myriad running marathons held in Austin each year. Construction on I-35 and US 183 is a way of life.
9. Manchaca, TX is pronounced MAN-chack. Also, the city of Manchaca (MANchack) is in Hays and Travis Counties and there is also a very long street in Austin named Manchaca (MANchack).
10. The city of Manor and Manor Rd. are pronounced "MAY-ner"
11. Please don't pronounce the 'E' at the end of Guadalupe. It's Gwada-LOOP and we like it that way.
12. Burnet Road is pronounced BURN-it, not Bur-NET.
13. Koenig Lane is pronounced KAE-nig not KOE-nig.
14. The old airport (Robert Mueller) is pronounced Robert Miller and is on Airport Blvd. The new airport (Austin-Bergstrom) is no where near Airport Blvd. It's in the city of Del Valle pronounced Dell Valley.

Summer Shopping

2008-05-29T12:36:00.000-05:00

Curious as to when seasonal items go on sale? Check out this site.

http://www.consumerreports.org/cro/money/shopping/shopping-tips/sales-calendar-7-07/calendar/0707_sales_cal.htm

Ingredients of Regional Success

2008-05-27T12:26:00.002-05:00

Some of Austin's unique community assets.

Diversity & Synergy
Greater Austin is a five-county region thriving on a balance of technology, business services, education and government.

Workforce Generation
Nearly 1.5 million residents, almost half between ages 18 and 44, and a median age four years younger than the national median.

Academic Strength
Eight colleges and universities, with renowned academic programs and enrollment of over 118,000 students. Some 43 percent of adults in the city of Austin and 39 percent of adults in the metro hold a bachelor's or advanced degree.

The University of Texas at Austin
World-class programs in bioengineering, computer science, engineering, business, nanotechnology, bioinformatics and pharmaceutical research. Seven doctoral programs ranked in the nation's top 10, and 22 others ranked in the top 25.

University/Corporate Collaboration
UT's associated programs include the Austin Technology Incubator, IC2 and the Office of Technology Commercialization. Austin Community College offers customized training for employers.

Business Friendly State
No personal or corporate state income tax. Texas is a right-to-work state with minimal union activity.

Attractive Location Options
The five-county region's commercial real estate market offers exceptional value, with an office vacancy rate above 20 percent and falling rental rates.

Transportation Infrastructure
A modern new international airport, along major highway shipping routes to Southwest business centers, Canada and Mexico.

Exceptional Quality of Life
Ranked fourth among Travel & Leisure magazine and America Online's Most Loved Cities. A young, creative, culturally rich community set among the lush hills, lakes and rivers of the Texas hill country.

Taken from the Greater Austin Chamber of Commerce Website

History of Bryker Woods

2008-05-15T13:33:00.002-05:00

There is no single date marking the beginning of what is now known as Bryker Woods, since the neighborhood is actually a composite of many small subdivisions (and some resubdivisions) which were platted at different times.

The origins of the neighborhood can be traced at least as far back as 1886 when the 14-lot William Theile subdivision was platted within a stone's throw of Shoal Creek. This one block subdivision still exists today as the block between 34th and 35th Streets and Kerbey Lane and Mills Ave.

On the William Theile subdivision plat, West 35th Street is labeled as the "Burnet County Road". By the early 1900's, the Burnet County Rd. had become known as "State Street", perhaps because of the amount of property on the street owned by the State of Texas. Early subdivisions abutting State Street included Camp Mabry Heights (platted in 1913 in the northwestern corner of the neighborhood near the MoPac railroad tracks), and the Ed Seiders Subdivision, immediately to the west of the William Thiele subdivision.

Camp Mabry Heights, obviously named because of its proximity to the National Guard Armory, Camp Mabry, reflected a patriotic theme in its street names: Pershing St. and Funston St. names after American Generals Pershing and Funston, and Jefferson Ave., Harrison Ave., and Madison St. named after U.S. presidents.

The Ed Seiders Subdivision references the proximity of the neighborhoos to the old Seiders Spring, located on the banks of Shoal Creek near the present day Shoal Creek Hospital.

Taken from Bryker Woods Neighborhood Association website http://www.txinfo.com/brykerwoods/History

Housing Indicators

2008-05-04T22:44:00.002-05:00

Get Involved!

2008-04-09T14:49:00.001-05:00

Protect your business & your housing market and get involved!

On Thursday, April 10, in the Austin Board of REALTORS® Auditorium, at 12 P.M., Austin REALTORS® are sponsoring a City Council Candidates’ Forum and lunch. Please attend and express your opinions on the proposed ordinance regarding point of sale. This unique opportunity will allow our industry to ask questions of the candidates.

Austin homeowners will need your help to understand the reasons single family homeowners will be required to obtain a license from the city of Austin prior to selling their homes.

The City of Austin is introducing an ordinance to mandate energy efficiency retrofits for all types of properties in Austin, including single family owner-occupied homes.

They intend to enforce it at the point of sale. In other words, prior to the sale of any single family owner-occupied home, a certificate of compliance proving the required efficiency retrofits have been done must be done prior to closing.

WHAT THIS MEANS TO YOU HOMEOWNERS

Without a Certificate of Compliance filed of record prior to closing or at point of sale, a single family home cannot be legally sold in Austin.
Delays in the time from escrow of a purchase agreement to closing due to the compliance and inspection process could exceed, by days or weeks, the typical 30 to 45 day time frame in a sales transaction today.
Immediately upon the effective date of the ordinance, the city will have to implement methods and processes to meet the demand created by the sale of some 25,000 homes per year. That’s 25,000 inspections, assuming the first inspection results in the issuance of a certificate of compliance. City inspectors say that at least 50% of all inspections result in a subsequent inspection to correct problems found. That’s an additional 12,500 inspections, at a minimum, or some 37,500 new inspections in a typical year to determine if single family owner-occupied properties comply with the new proposed ordinance. Who will pay?
Homeowners will bear the expense of retrofits to obtain the certificate of compliance. These expenses will vary from home to home, but the range could be anywhere from $1,500 to $10,000 per home.
Expect delays in acquiring another home as homeowners scramble to comply with the new ordinance, especially if that homeowner needs to sell his or her existing home prior to closing on a new one.

WHAT THIS MEANS TO ME AS A REALTOR®

Delays in almost all individual single family sales transaction processing times.
A potentially devastating slow down in the entire marketing process of single family homes.
A new Seller’s Disclosure Notice item which your client must address before selling or buying a new home, creating more risk for your professional liability
This certificate of compliance is tantamount to the city requiring a license to sell a personal home.

For more information please contact the Governmental Affairs Department at government@abor.com .

Fed Rate Cut

2008-03-21T11:06:00.001-06:00

Real Estate Outlook: Fed Rate Cut
by Kenneth R. Harney

There's no other way to put it: Things got pretty tense in the financial markets earlier this week -- with the Federal Reserve's dramatic steps to inject billions of dollars of liquidity on Wall Street, plus the failure of giant investment bank Bear Stearns.

Then came the Fed's big three quarter of a point rate cut on Tuesday -- and promises by Fed chairman Ben Bernanke to keep supporting the capital markets in creative ways for as long as needed to spur new economic growth.

When the global financial system shakes and shudders like it did, the tremors are felt in every major segment of the economy that depend on capital -- and of course real estate is high on the list.

So what might all this mean for home buyers and sellers?
Number one, focus your attention on what Mr. Bernanke said: The Federal Reserve is NOT going to let the economy go down the drain because of some dumb subprime loan investments made by Bear Stearns and other large banks during the boom.

The Fed is probably not finished cutting interest rates -- and ultimately that should exert downward pressure on mortgage rates and help housing and real estate.

But we've got to be frank here. There's a potential dark side that is not getting much public attention yet: Major lenders may not pass along all those lower rates to home buyers.
What we're seeing this month from Fannie Mae, Freddie Mac and big banks are a series of new "add on" costs to loans plus higher minimum downpayments.

The add-ons are for credit scores below 680, houses located in "declining" markets, and new "jumbo" loan amounts above $417,000 authorized by the economic stimulus package. The net effect may be to limit -- or even cancel out -- the beneficial effects of the Fed's cuts to base interest rates.

Now despite all this, there continue to be clear signs that the housing market itself is finally bottoming out of its nearly three year post-boom correction. One sign we saw this past Tuesday was in new housing starts, which came in at a surprising 1.065 million annual rate, well above the 980,000 to 990,000 most analysts had predicted.

Ara Hovnanian, CEO of Hovnanian Enterprises, a major builder, told CNBC's "Squawkbox" program Tuesday that three straight months of essentially flat housing starts means the worst of the housing slump -- at least for new construction -- is probably now past us.

That doesn't mean happy days are here again, but it does point to gradually improving real estate conditions in the months ahead.

We'll see and we'll keep you posted every week.

Published: March 20, 2008

Special thanks to Kelly Ewert of Heritage Title Company of Austin for sending me this article.

A Smart Buyer

2008-03-11T12:24:00.002-06:00

A Buyer is very excited once they locate and have an executed contract with a Seller. At times, this excitement translates into wanting to see the property as much as possible before taking ownership.

Buyers begin their search with a list of homes, and when they locate their target purchase/investment, they should make their offer. From the time of seeing their target future home, to an accepted contract with the current owner, the Buyer might have seen their future home a total of 20 minutes to around 1 hour. After going under contract, there is a general inspection which could lead to further specific inspections on very specific items (A/C, Termite, Plumbing, etc.).

An issue I see occur is a Buyer gets too excited over what future plans they have for the house which translates into an excessive amount of time and energy towards contractor appointments before they own the property. Getting bids and pricing is important for a Buyer. However, there has to be an acceptable understanding of how much can be done with a small window of time before taking ownership.

Buyers need to set themselves some boundaries for their benefit and all other parties involved. Too many pieces of the buying puzzle will confuse everyone involved, which leads to misunderstandings, poor memory, and confusion.

With a re-sale home which is occupied, this could negatively affect how repair negotiations go. Buyers who visit the property so often for too long, can chip away at the seller's level of tolerance and thus hurt future negotations on a repair. New home construction is even more problematic because if there is work being done by owner/seller/builder to complete the project by close date, the buyer could engage in a conversation with the owner / builder.

I have rarely seen a situation where builder and buyer during a new home transaction, see eye to eye on all aspects if the property being sold is a Spec Home. Spec Home & New Home Construction are critical times for a Realtor to provide value for a Buyer. If the Realtor for that Buyer is not present during one of these question and answer periods, then promises could be made or facts could be misunderstood. Always go through your Realtor; buyers should accept a ''point man'' for the work prior to closing and that point man is their Realtor.

And of course, there has to be a healthy understanding of what exactly is being done AND exactly what meetings take place prior to closing (and those contractor bids than are personal changes of buyer which could be done AFTER the closing).

2008-02-13T14:12:00.002-06:00

I am often asked how the market is doing for me, and for the area I live/work in. Housing and real estate seem to dominate a lot of our media and justifiably so. It affects us all. On any given day you can find an article or catch a new clip that tells a different story. Some of the news we hear is national news and some is local – most of the times it is one BUT spun as the other… My neighborhood could be dealing with different issues than yours. Our city could be faced with different issues than a friend of ours. Some of the news is using statistics to tell a gloom and doom story because that sells papers. So, what is really going on in the Austin area real estate market (also known as the 5 counties of Travis – Williamson – Hays – Caldwell and Bastrop)?

Last year in Austin, Texas, our median home price rose from $175,000 to $191,250. That is a 9.2% increase. That's a good year compared to the 40 year historical average in America of below 6%.

Our current inventory is 5.93 months. 5 months to 6 months is a neutral market. Any more than 7 or 8 is when we are in a Buyers' market. This means that housing prices will continue to rise above the inflation rate.

We anticipate that 2008 will be a very stable year in the Austin area. Our builder inventory is coming down and some of the large builders are pulling back on the reins in attempts to limit their exposure in tougher markets.

In the next year 5 years, our economy is expected to grow by 32%. We are expected to have a 15% increase in our population in the next 5 years, and that will live where?

Interest rates are again at an all time low. Making homes more affordable for families. The entire ‘’sub prime’’ loan which was the top story last Spring and Summer of 2007 represents roughly 4% of the entire loans originated – 4 %! That means that over 95% of the loans are NOT sub prime.

"I am seeing a ton of listings in my neighborhood, is that a problem? Something going on?...” A common question which I believe the answer has to do with the known part of our brain – The Reticular Activator. The Reticular Activator can be best explained by buying a color & type of car which we believe to be unique until we see it everywhere all over town. I believe that with the political season and amount of real estate headlines, it is hard not to see the listings because we all fear ‘something’ happening to us.

Texas was a top job – creating state from May 2006 to May 2007 *Bureau of Labor Statistics

Houston & Dallas were the top 2 of the best 10 cities netting new jobs from May 2006 to May 2007 * Bureau of Labor Statistics

In a nutshell, our market is healthy with good affordability, good job growth and stable inventory levels. We think the future of Austin Real Estate and its value is a strong investment. It is a good time to sell. There are also some really good deals out there. As an investment goes, real estate is a tremendous wealth builder.

If you want any data or statistics to review, your welcome to call me.

Let's Start This Off Right

2008-01-21T13:35:00.000-06:00

As we kick off the new year, my intentions on this blog remain focused on; general issues relating to the City of Austin, real estate with a connection to Austin in some way, living in this city (Austin and the 5 County area; Travis, Williamson, Hays, Bastrop, Caldwell Counties) and topics relevant to industry/ profession Realty.

To kick off the new year, I will review some lessons taught to me through a very solid business coaching membership, Buffini & Company, based in San Diego. Nothing is done for me or offered through my Real Estate Broker common in other office structures - no 401(k), no stock options, no insurance. So I will list some steps which have been taught to me. Please consult with your Accountant, Stock Broker, Financial Advisor & C.P.A. for their advice;

To ensure stability, it is important to secure the following:

1. Working budget of home expenses & business expenses
2. Signicantly sized life insurance policy
3. A Will or Trust
4. An ''auto withdraw'' into your saving accounts
5. 1 month's expenses in reserve
6. A fully funded SEP or IRA
7. Health Insurance
8. Disability Insurance (this one can be tough & costly, one can be
creative and purchase a piece of real estate and pay down
quickly just for this step alone)

To set oneself up for success, the following are needed:

1. Financial & Retirement plan
2. A living, revocable or irrevocable trust
3. Annual Assessment of your net worth
4. Real Estate and Stock invvestments
5. 3 to 6 months expenses in reserve
6. Cash reserves to hire staff as business grows
7. Tax Strategies for deferment
8. Monthly profit and loss statements
9. Drop all fixed expenses in an account with auto withdrawl for those expenses

Significance Plan

1. Passive Investments provide for your current lifestyle
2. Gifting strategies
3. A plan in place for aquisition of your business
4. Profit Share plan for staff

If you or someone you know would like to talk with the true source of this information, Buffini and Company, call me and I will connect you with the right person.
Happy New Year!

The Stages of Grief

2007-11-15T10:22:00.000-06:00

Change is certain, it is what a market does – no straight line. Regardless of the location of your real estate market (East Coast, Mid West, West Coast) there has been a change. I have written on some subjects of these changing markets and this particular entry will address what it means to the Sellers. There are currently two types of changes; #1 corrections as stated in the California market or Miami, Florida ‘Loft’ market with falling prices and/or #2 intrinsic value, value based on an underlying perception, which can just slow down the time it takes to sell real estate (while values don’t change that much).

These two types of changes can put Sellers in a state of mourning. Sellers are either experiencing a monetary loss (comparing their sale to what their neighbor got a year ago) OR the Seller is just worried how long their house will sell (time being money towards insurance, taxes, mortgage payments). Very possible for the owners of the listings out there to be experiencing feelings of fear, loss and regret. Quite literally, they need to go through the five stages of grief. Their Listing Realtor in their ‘’corner’’ should be aware of these stages and, when appropriate, help their client/Seller move through them.

Selling homes is an emotional job and Realtors must stay connected in order to assist with the decisions. Not all decisions are pragmatic ones and without knowing the emotions of the ‘’home sale’’, I believe a Realtor is disconnected. Likewise, a Listing Realtor can’t take on the responsibility of the market but should seek to understand their clients mind set. Review below the stages of grief.

DENIAL; recognize if your friend who is selling their home, or a client is in denial. Get the facts of the market out, explain the market. Go through sales in the area, the city and the price range.

ANGER; Sellers can understandably get angry and upset. If their home was worth more 1.5 years ago and they ‘almost’ moved but decided to allow their kids to finish school, they could be upset. Another example is just the time it takes to close on their home. If the owner/Seller was use to 60 days from start to close, and now it takes 120+ - they will be surprised!

FRUSTRATION; During this stage clients start venting. Hardest part of selling a home is the days it takes to get an offer(s). Sellers work hard at preparing their home to be listed AND continue their preparation through most showings (if they live in the house being sold). It would frustrate ANYBODY to mentally prepare to sell a home, then stage it, move extra furniture out, clean up each time before every showing AND THIS GO ON FOR 7 MONTHS (maybe not as much the investment property being sold – I am mainly talking H-O-M-E where we eat,sleep,’’relax). Another rub for Sellers is the lack of day to day ‘’work’’ when their home is on the market. Sellers do so much before their property is listed, but sits back once the home is being marketed by their Real Estate Broker. Compare that to a Buyer, who can put their nervous energy into a meaningless newspaper list of properties or review listings on the internet, maybe even drive around a neighborhood.

DISAPPOINTEMENT; Point in time when Sellers realize things may be different than what they had hoped for. The Seller begins to come to terms with making the necessary adjustments to get their home sold (and very much needs to have market information ready to review, reviewing quickly and easily numbers+charts+graphs).

SENSE OF ACCEPTANCE; Seller is ready to put together an updated strategy to get their home – their property, sold!

An Actual Report of the Local Real Estate Market

2007-11-01T08:28:00.000-06:00

When articles or news stories get your attention on the residential real estate market, pay close attention to the style of reporting. Are the facts based ONLY lon ocal information OR are statistics being used that are for the entire United States?

As it stands today, there are a number of markets experiencing a sharp decline in housing values. These same markets have been riding a wave which started around 1995 (like some places in California) and continued with 20% to 30% appreciation (at their highest levels for 5 years plus running) through 2005. As stated by the owner of the company I hold my license with, Gary Keller of Keller Williams Realty, ''...from 2001 through 2006 the real estate market got 'overtime', bonus playing time so to speak...''. His comments come from the loosening of the lending, the liberal regulations on lending practices nationwide.

In 1995, the markets simply began a cycle that could be expected, however in 2001/2002, the current President Bush continued what the former President Clinton was doing with an emphasis on home ownership. Two Administrations in the White House spanning approx 12 years plus a new level of acceptance by the Federal Reserve in ''manipulating'' our economy resulted in some loan programs never seen before. This fueled a market that was due a correction.

These new loan programs supported the continuation of the appreciation of home values in areas like the city of Boston and many parts of the state of California. One fact that has been brought to my attention is the fundamental principal that housing values and income must be in line, otherwise a ''bust'' will follow - ALWAYS! If home prices are double and triple compared to income, either a second income needs to be created (as seen in the 1980's with two income households becoming a norm) or a third income could be seen (like now with children aged 17, 18, 19+ who are staying at home and bringing in $300 to $600 per month towards housing expenses for the family). In any event, housing prices and income must stay relative. With the continuation of housing prices in some markets in the United States, and income not growing, we get the news of depreciation in neighborhoods.

As the lenders correct themselves (they have) and take their medicine (they have and are) and work through the reporting of their mess (they are and some of the reporting has been bogus, i.e. the reporting on Country Wide) ''things'' are getting back on track. Loans towards persons with poor credit, flexible income are almost non existent. However, that is just the ''sub prime'' markets. ''Normal'' lending, the lending that has always been around? - that is doing fine.

Another key word, intrinsic value, is what to keep an eye on. How are the markets in these areas like California going to work out? What is unkown is what the borders to these markets are. Because of the long, rich years of massive appreciation (higher values while income stayed put) there should be many years of a drop - 2011 some experts are predicting for these markets that had such a huge spike (spike will follow with ''bust''). While this will be hard news for people in this areas that were taking home equity loans to support their living year after year, Buyers who had to stay on the fence and rent will get into this market - GREAT for them.

With our local ''5 County Area" (Travis, Hays, Williamson, Caldwell, Bastrop)/Austin market doing well economically and staying on the radar of expected population growth (plus of course job growth) we are a bit of an exception to much of the national news. We have around 6.5 months of inventory. The ''experts'' state that under 6 months is a Sellers market (locals state under 5 months for Austin is the Sellers market) while over 6 months is a Buyers market.

For prices to drop, the ''experts'' state that the months of inventory need to reach 9-10-11 months to see a price drop. We experienced a drop in sales in August (contrary to the reporting in the Austin Statesman, we Realtors usually do see a drop in August) and a drop in sales in September. This ''drop'' in sales has been compared to 2006 and though relative, it should be pointed out that 2006 was a CRAZY year for ''wide open lending practices never seen before''! So is the drop expected after such a high year in 2006? or is this a trend? Lets watch the economics of Austin and the intrinsic value of real estate......and hope the reporting of news in the Statesman begins their stories how they like to end them :)

The Davidson - Littlepage Cemetery

2007-10-30T19:52:00.000-06:00

Ever driven to Austin Bergstrom Airport? Or, for that, matter driven away from that airport heading NorthWest/West? Chances are you have driven past The Davidson – Littlepage cemetery located on the Bastrop Highway coming toward Austin from the direction of the airport. Once the airport moved to Bergstrom, I became more and more interested in finding out why this cemetery is where it is, and who is buried there. My imagination ran wild and finally, because of an interest in posting some entries relating to the history of various parts of Austin (and the places we all drive by), I went to the Austin Historical Library on Guadalupe. The woman who assisted me was great, the material is awesome and my time was very quick in attaining my goals for this mysterious cemetery. Thanks to the reporting by Tom Barry of the Austin American Statesman, here is the findings (not exactly so exciting, but I can at least check this question off my list). The most exciting discovery was this piece of real estate could still be claimed by a relative….

“…This little graveyard hosts 5 markers with potentially 6 gravesites. When the highway department’s survey crew were surveying the mesquite pasture to make a place for the improved Bastrop Highway (completed in 1959), they came upon this little graveyard, its headstones tumbled to earth by time and neglect, completely obscured by grass and weeds. It was on the right-of-way, but it was not in the way of progress so saving it they did. All efforts to locate relatives of the long forgotten dead were in vain, so Texas Highway Department made an ‘’exception’’ in its right-of-way purchase, put up the current chain link fence, righted the headstones and cleared away the weeds. The dead of the little graveyard have been there, some of them, for more than a century. They may have been forgotten for almost that long. They are names like any other names, but pronouncing them means nothing, for who the people were, how they lived and died – all are as obscure as if the dead had never lived. A widely known historian of Travis County, Mrs Fred C. Barkley, knows quite a bit about the history of this county and tried for years to find out something about the little cemetery. Mrs Barkley could only report on rumor and speculation, but little else, the graveyard was originally Spanish land, part of the Del Valle grant. Some of the land was possibly deeded to people named Caldwell by a Spaniard, who deeded over the land in lieu of a law fee which resulted from the legal defense of his son in New Orleans by a lawyer name Caldwell…”

Inside the old iron fence are buried;
Martha Littlepage, who lived from 1837 to 1868
Susan V. Littlepage, born April 23, 1804 died Jan 21, 1870
A rugged, hand-hewn block of granite markes the grave of L.O. Davidson Campbell, wife of J.E. Campbell; Died November 1857
Another gravestone, shaped like a bishop’s mitre, marks the resting place of two persons-
Martha E.A., wife of A.M. Davidson, Born May 3, 1816 Died Apr.12, 1864
James A., Eldest Son of A.M. and M.E.A. Davidson, Born Aug 8, 1836, Died Dec. 8, 1856

The Austin Sales Pitch

2007-10-02T17:25:00.000-05:00

Susan Davenport with The Austin Chamber of Commerce (http://www.austin-chamber.org/) is a fabulous spokesperson, no wonder we are doing so well!

She's a wonderful speaker, both fascinating and inspiring with regards to Austin and its potential. She stood in a room of Keller Williams Realtors (60 to 80 I am guessing), impeccably dressed, gave a positive presentation, then was a very good listener towards the random questions from the audience. If there was a question Susan did not have the answer to, she was the first to state such. There was so much information from the meeting and I will highlight some of the parts.

The Chamber has a great web site, and if you want a 130 page power point presentation she provided, let me know and I can attempt to email it. Her presentation focuses on the 5 county region surrounding the city of Austin; Travis, Hays, Bastrop, Williamson, Caldwell Counties. These other counties outside of Travis (where Austin resides) do have their own Chamber, but I believe some of the growth and ‘’bragging’’ is mixed in with these 5 counties.

As stated above, Susan had a lot to highlight regarding Austin; population growth (estimated to be over 2 million by 2015), job growth (around 91,000 expected in the next 5 years), highest per capita income in Texas metros, 8 colleges/universities with 118,000 students (consider in addition the professors/T.A.’s, custodian staff, etc.), nearly 71% of the population is under 45 (vs. 64% nationally), 39% of the population over 25 has a bachelor’s degree (vs. 27% nationally). Our main inflow of new residents comes from other Texas cities, which most likely stems from graduates of University of Texas and the other 7 universities/colleges.

Being a ‘’native Austinite’’, there are many of us that won’t live with our spouses anywhere else so a warning to all non-Austin folks, don’t marry an Austinite! California, Chicago and Miami also represent a high count for new residents coming to Austin. I think the outflow of people represents patterns with Dell Computers since two of the top three locations, North Carolina & Tennessee are areas where Austin residents move to/away. Another city which attracts a lot of Austinites is Atlanta.

Susan also got into another section of her presentation regarding the power of Austin; a large number of private employers, a number of business which call Austin their HeadQuarters, the corporate significance in general in Austin, recent new/expanded operations. A major success story is Samsung, with their large deposit into Austin for their business. Susan explained part of the success in earning Samsungs investment in Austin, relates to the University of Texas systems dedication to sending delegates to meetings involving the Chamber and companies. She wanted to emphasize recognition in the importance of the delegates since these employers need the student work force, the research, the resources.

Towards the end of her presentation, after going through her power point with one awesome bit of information after another, I could tell what the questions were going to be - “ok, what is the negative? Tell me something to be worried about?”

At this point, the audience took over relating stories from clients (Buyers and Sellers plus Realtors) about the problems with traffic, education rates, cost of living. The airport also caught some heat about the number of or lack of non-stop flights and lack of international flights for an international airport.

Susan mentioned how closely The Chamber watches the unemployment rate especially when it dips below 4%, what they consider full employment for statistical purposes. Full employment makes for a tougher atmosphere in hiring workers for these corporate giants Austin wants to bring in. When a ‘’C’’ level executive considers moving his family across the country to a new opportunity in Austin, Austin has to have a variety of fall back jobs in case something goes wrong for this ‘’C’’ level executive, so variety is very important within an industry/profession. Susan and The Chamber want to increase the stability, so successful in the 80’s when banking/oil were so upside down. Since Austin is the Capital plus host to University of Texas, there is a strong stable base of federal and state jobs.

Utilize the web site, (http://www.austin-chamber.org/), go to Economic Indicator and enjoy.

Staging

2007-09-20T12:14:00.000-05:00

Now I want to focus on what I was thinking while listening to Gary Keller’s presentation for Sellers. There are five considerations when selling property: 1.Condition 2.Price 3.Terms 4. Marketing 5. Location.

Consider these examples to define the list of 5:
1. Condition is focusing on how well the paint job is inside/outside
2. Price needs to be relative to other similar homes which are sold/pending/active in the market place
3. Terms could relate to the seller carrying financing, providing better terms than a 3rd party lender (highly unlikely in today’s low interest markets)
4. Marketing requires that the Realtor catch Buyers/other Realtors interest to see the home
5. Location putting emphasis on what the market will pay for the house next to a business, near a busy road, in a poor/better school district.

The 5 items above were intended to warm you up to the key word for this entry, STAGING! When a property is correctly staged, the condition will shine and the seller stands the best chance of getting top dollar on price.

Staging is not a fancy word for major home improvement requiring major dollars to be spent. There are a number of affordable ways to make a home shine before it goes on the market. If inventory of homes climbs higher and higher, it is going to be more important to allow a property to show well when the Buyers visit. High inventories in the housing market mean longer periods of showings because Buyers will want to see everything in case there is that one property that has all 10 of their wish list. If a home has a repair, or requires painting or new carpet, Buyers could decide to look further and state, “lets look at some more, we can come back to this one” – which is a killer for a listing because rarely do they come back.

A home must create enough of an impact to create the natural Buyer urgency. This Buyer urgency is a healthy concern from a consumer that the house is so attractive and priced well, therefore, it is highly possible someone else is after it also. This statement relates to Gary Keller’s discussion on timing a real estate market.

There is no way to time any real estate market. When a property is priced right and staged (good condition, clean kitchen, etc.), it will sell. Areas to focus on include: the kitchen, appliances, baths, storage areas, floor coverings, (and flooring itself), walls, mechanical systems, windows, the entry (front door paint job!), and finally curb appeal.

Begin by any caulking needs around the bathtubs and sinks, patch any cracked grout. Clean out the oven, microwave, interior trash ‘areas’, refrigerator and make sure all are odor free. Clean windows, window sills and window coverings (remove elaborate window coverings to allow rooms to be bigger OR to save them from being part of the purchase) and let as much natural light in as possible. Go to the trouble of replacing light bulbs for extra light, and dust off ceiling fans. Another round of simple ‘staging’ is outlined with making sure all doors latch, don’t stick, knobs turn, toilets don’t run, faucets don’t drip, etc.

Sellers must take a closer look at the appliances in a kitchen. Review the comparable properties with your Realtor to see if top dollar sales are offering newer updated appliance packages. Sometimes just ordering newer doors or face panels can be done through the manufacturer. And a basic is keeping the same color scheme throughout the kitchen with appliances.

Here is a great “2 for 1” when dealing with the extras that fill up a garage and all available storage. Plan out the right approach for you with a garage sale, consult with people for the best, safest way to hold a garage sale (don’t let anyone inside your home, send kids away for the length of the sale, have a friend/family member with you at all times). By cleaning out garages, organizing closets, packing up what is no longer needed you could find a lot of the stuff to do the staging through this garage sale. If you have additional furniture that you can live without, get a storage room if the furniture does not qualify for the garage sale. You want to keep horizontal surfaces empty so prospective buyers can visualize how their own possessions will look and fit into your home.

Finishing up with the interior, keep floors and floor coverings clean. Attempt a professional carpet cleaner before just replacing the carpets which could save some money (except for houses with inside pets). Walk around your house and really look at the paint in every room. Do you see smudges on doorframes? Around light switches? Front of cabinets? New paint makes everything look cleaner and brighter and brighter can equate to a room looking larger. Consider using lighter colors in dark rooms and most interior designers will recommend a lighter contrasting ceiling.

And while curb appeal may be the most obvious on the list of ‘’first impressions’’, it can be forgotten. Make sure the entry is fresh of cobwebs, bugs, pet dishes and toys. Get a new doormat, fresh paint/stain on front door. Consider what a planter or series of plants around the front could do. Take a look at the hardware around your main entry, consider replacing it with more substantial handle –and-lock set. Keep your walkway freshly swept, edged, and your lawn mowed. All gardens should be weed free with well placed evergreen shrubs. And one of my favorites is power washing all concrete and rock walls in both front entry and back patios plus driveways ($70ish per day).

I threw a lot out there for the term staging, and only have one caution when preparing a home for the market – your neighbors. Over the years I have encountered the scenario where a next door house has never been fixed up, and this house is just short of having cars on cinder blocks with the proverbial toilet in the front. Don’t’ worry about them, you can’t change that neighbor just for your house selling needs and any attempts could be a disaster. Consider that this neighbor is tired of having you live next to them, and will be excited about seeing your for sale sign. By not saying or offering any advice to this neighbor (hoping they clean up so your sale goes smoother/quicker), you reduce the chance of any negative fictitious stories being created if this neighbor sees the buyer during the first showing.

Gary Keller

2007-09-18T15:15:00.000-05:00

I have recently participated in a couple of fascinating meetings this month. The first one was with Susan Davenport, spokesperson with the Austin Chamber of Commerce and the second was with the owner/creator of Keller Williams Realty, Gary Keller. So much information was discussed that I will supply multiple entries to cover the high points. I will offer a quick study on each presenter so you can understand their approaches to our markets here in Austin. Once I have outlined each presenter, I will cover their presentation. Gary Keller wants to keep his offices profitable by knowing exactly what is going on Nationwide with real estate and lending. Susan Davenport focused on ‘’selling Austin’’, moving business here and the favorable future Austin has. This first entry will be focused on Gary Keller.

Mr. Keller is a graduate of Baylor University, late ‘70s I believe, with a degree in Real Estate. He calls himself a ‘’black hat’’ (possibly referring to some views of a pessimist?) and says he proves it by always wearing black. The day of the seminar, he proved it wearing black shoes/slacks/dress t-shirt/sports coat. He came to Austin and began selling homes with JB Goodwin (at that time JB offices had the dominance that Keller Williams has now).

Gary is not so much a ‘people person’ as he is a ‘thinker’ and he is the first to state this. Mr. Keller is more into operations, systems, strategy, ‘’x’s and o’s”. Keller is not wired to sit in a living room and offer tons of empathy if a house is upside down (worth less than what they owe a bank). Gary Keller pursues information, seeks to apply the information to prove its validity, then stands behind the proven results regardless of how it makes someone ‘’feel’’. I make this point because of what is happening in California and some other markets where the housing prices are falling 10% to 20%. I also believe Gary was wise to move into management as the profession of being a Realtor requires empathy at all levels and times.

During his entry into the real estate business when rates where 17% plus, and Sellers were having to pay TONS of closing fees to sell their house, Gary states he did not provide any empathy because that was just the market he was working in. Gary believes it was helpful to be young and new to a ‘’tough market’’ when he entered because he did not know any better. From selling real estate, he moved into management with JB Goodwin in what was then a very desolate part of Austin – Round Rock in the early 80’s. While Austin was BOOMING, Gary was growing an office in Round Rock, and he was successful.

Gary’s next move was his own office in 1983, with partner Joe Williams. Sometime around 1987, Gary acquired some information regarding the strategies of a multi-level marketing involving vitamins. Gary took pieces of that business model to revolutionize the residential real estate industry as we know it today. Gary’s changes blew the usual models of a real estate office by allowing the top 10% of his Realtors in the office to decide where the money was spent, when new computers were needed, and other office policies.

Gary also offered his Realtors a beneficial commission split, so Realtors could chose how to allocate their expenses rather than pooling money and spending as a group. In the 70’s & 80’s, Brokers operated ‘’top down’’, telling their office what would happen and also having closed financial books, opposite Gary’s model of Keller Williams.

Keller Williams Realty is now nationwide and ranked 4th in North America. Interested in going global, Gary’s main focus is taking over the #1 spot in North America first (supposedly the growth in the other top 3 real estate franchises is coming from China and Europe and that is of no interest until Keller Williams Realty is #1 in North America).

Nationwide, Gary noticed in 2005 that listings sold versus listings taken jumped dramatically. He believes this was the first sign of what is going on in markets like California. Gary reminded us that if housing prices shoot up 120% like they have in California over 5/7 years, and income does not stay with that growth (rarely does), a crash is coming. Real estate values only go up while income stays down, if people are buying and selling with tremendous loan incentives. And we have had some incredible lending opportunities for Buyers to chose from – bad credit with zero down, etc..

Austin did not rise like the markets mentioned above. From 2000 to around 2004, our average price hovered around $197k/$198k. We began to see an increase in 2004, and today we are around $248k average sales price (close to a $190median price).

Gary Keller is a “Realist’’ on the market, he wants to know the numbers and stick to a strict set of principles that will survive in any economical atmosphere. Gary is also very opportunistic when it comes to opportunities in our market. Gary is also closely watching what the result will be after years of extremely lose lending practices. In the 80’s, our market folded followed by California’s market. Gary, wearing his ‘’black hat’’ wants to make sure he and his offices are on top of any market should California ripple our way.

Crackberries

2007-08-23T11:50:00.001-05:00

I am a recent owner of a Blackberry phone, and with ownership has come much harassment from friends/clients and even co-workers in my real estate office. I have been known to be a bit slower at utilizing technology. One friend and client pointed to a simple “social text’’ I was unaware of on my cell phone for over two months (this was 2 years ago). I updated my approach, because my clients and their referrals were communicating more and more using text messages and emails, and I needed to adapt to what was expected, hence the Blackberry.

Many other Realtors that I know are slow to jump on the technology bandwagon for good reason. Some of the latest communicating technology is not always the best for what we do as real estate agents.

In relationship sales, where a service is offered to aid in buying and selling, I firmly believe there will always be a need for face to face OR voice to voice contact – in other words relationship sales is a contact business. This is why many innovative ideas in the real estate business that have attempted to remove the Realtor have come and failed.

There are times that a simple text is useful – “…inspection has begun”, “…got your message, working on the information”, “…here is the data your requested”. However, the initial meeting between a Realtor and Principal (Buyer & Seller) establishes the foundation to reach goals of Selling / Buying and should be face to face.

A ‘face to face’ is critical, because it allows both parties to assure themselves comfort in working together for an extended period of time (finding or selling property can be 50 to unlimited days long). Face to face meetings allow Sellers to witness the environment of the office their property will be listed and marketed from (the other Realtors in the office are very useful).

The Face to face meeting also allows non-verbal communication, which is not available through texting and emails. Through the non-verbal cues, a good sales person who listens can gain better insight to what is truly comfortable for their client, then proceed to ask further question. The non-verbal cues and questions can result in far more options to achieve the desired goal of the principal – something a text or email just won’t cover. Since all Realtors should operate under a fiduciary role, listening and watching for non-verbal behavior aids in better representing the interest of their client.

Too many emails or texts in a service based business leads the principals to wonder where the value in the business is. The value for a service based business is in listening, not talking, and too many times a sales person believes they will just talk their client into buying the service or the product. I have been very enthusiastic with the benefits of my new phone (a.k.a. “Crackberry” due to its addictive sides of checking) and the ability to text from a keyboard has been wonderful. In addition, having emails arrive to my cell phone when I have spent hours away from the computer aids in quicker response (plus I am not arriving home after a day in the “field” to just sit in front of the computer for an hour with my family in the other room).

No doubt technology is a must, but technology is a tool and not and end to a service based business handling emotional decisions.

Real Estate Industry Facts

2007-08-16T11:29:00.000-05:00

There's been so much information in the news these days regarding nation wide home sales, as well as the general real estate industry. Let me state simple, quick facts that are easier to digest.

If the country as a whole has anywhere near 3 million transactions in a year, the 'experts' consider it a bad year or a "poor market". If the country has close to 4 million transactions during a year, that is considered a good year or a "good market".

About 2 to 3 years ago, there were approximately 7 million transactions each year - wow is right. Last year, there were a reported 6.2 million transactions and this year the predictions are for 5.7 million transactions. These numbers are for reported residential real estate sales across the United States.

Keep this in mind when you discuss the business of your Realtor friends in California, for example. Their business is based on a transaction time of 52 days for their listings. This includes days on the market, escrow period, days under contract, and closing. Basically, the day the sign goes into the yard, to the day the keys go from one hand to the other is a total of 52 days.

Now, the Realtors in California and the owners of the properties on the market can expect their time frame to jump to about 142 days (in taking the listing to getting the offer to closing the transaction). As stated by a mentor of mine, Brian Buffini, "...how would it feel if your paycheck was the same but close to 100 days later in its arrival?".

Another interesting statistic; there are 1.35 million people nationwide with a real estate license. This number represents all kinds of Realtors; new, old, professional, part time, builders with licenses, people who never intend to use their license,etc. Out of this number, a reported 400,000 have not listed or assisted a principal with a transaction.

This entry is a bit periodic, but worth digesting if you are considering getting into the business or needing a Realtor. The industry needs good people who enjoy providing a service, representing the needs from start to finish, and taking the fiduciary role of a Realtor seriously. And if your in need of a Realtor, make sure you work with one that is knowledgable of the market you're in, and performs in a professional manner.

Summer Fun

2007-07-24T14:17:00.000-05:00

This can be considered the long stretch of summer - trips are completed, family/friends could be visiting, camps could be over, many are waiting for football to begin, and these days the wet weather. As an extra push I wanted to outline some of the options we have at our disposal.

Every evening between April and October the Congress Bridge hosts the worlds largest bat colony. Taking a walk or bike ride on the hike and bike prior is a good fit, just don't park too far and have to walk back in the dark. If you desire an adult beverage you can enjoy a nice array of margarita options at Manuels on Congress, then walk to the Congress Bridge (South side is best, to the East). A more expensive approach could be enjoying the balcony at the Four Seasons where you could stay put to get both the bats and the spirits. The Austin American Statesman has a hotline for many options, 512 416 5700, and for updates on news for the bats use the option 3636.

Rainy day? Got to entertain a History buff? Here is a checklist:

1. The Capitol 2. LBJ Presidential Library 3. Bob Bullock Texas State History Museum (IMAX Theatre and a really fun Texas Theatre) 4. Austin Childrens Museum 5. Elisabet Ney Museum 6. Umlauf Sculpture Garden 7. Austin Museum of Art 8. Mexican American Cultural Museum 9. Capitol Complex & Visitor Center

Another rainy day? Have your college buddy who was an art history minor? Austin is home to over 30 galleries; Blanton Art Museum, Harry Ransom Humanities Research Center at University of Texas, Laguna Gloria Art Museum (Laguna is really fun because if the rain ceases, next door is Mayfield Park with Peacocks and nature trails that can entertain all ages. You would pass Mayfield going to Laguna, and your just around the corner from Mount Bonnell and its amazing views of the city and lake).

Of course the Music Capital of the World provides tons of venues the minute you get off a plane. Concerts in the Park featuring the Austin Symphony Orchestra, 7:30pm, at Wooldridge Square Park at Ninth and Guadalupe through August 26. Just grab a Chronicle which comes out every Thursday morning for a list of all bands. If a movie is more your flavor, try Austin's very own style of move cinemas where you can eat & drink at the Alamo Draft House (several locations). They have ripped out every other row of seats to allow waiters to serve you from their full menu.

In addition to the outdoor activities mentioned above for Mayfield Park in Central Austin, you could go the Southern part of Austin to see Lady Bird Johnson Wildflower Center and afterwards take another 20 minute drive further South to eat at The Salt Lick BBQ (bring your own adult beverage/cooler). If you have eaten along Barton Springs Road - aka Restaurant Alley, Zilker Park Botanical Garden and Austin Nature Center is closer to Mopac / Loop 1. I might add the little well know park, Zilker with its 360 acres (aka THE Hike and Bike) and the Barton Springs Pool (1,000 foot long spring fed 'pool' with a year round temperature of 68 degrees).

Mentioning pools, use this check list; 1. Tarrytown has a small pool in the heart of old West Austin - Reid Pool (very small, has a park) 2. Deep Eddy Pool near Lake Austin Blvd & Mopac/Loop 1 (get a classic Austin sandwhich at Thundercloud on Lake Austin then drop directly across the street to Deep Eddy or drive before/after to HulaHut) 3. Northwest Park off of Shoal Creek (got to have a map to find this entrance but worth it with its large pool, two diving boards, and awesome shallow baby pool, plus areas to sit under the shade of oak trees) 4. Stacey Park Pool in Travis Heights - another wonderful historic neighborhood and spring fed pool.

If you and your group is ready to explore some of the areas outside of Austin, many choices abound along the Highland Lakes. This is a chain of lakes created by seven dams with options to boat, ski, sail, windsurf, canoe, row, fish and swim. Downtown Austin (the downstream of all seven mentioned) has its version (all water is the Colorado River) as Town Lake, up stream is Lake Austin. Our high rain fall has shut down many of the lakes, so options to see New Braunfels (Schlitterbaun Waterpark named the Worlds Best Park for over 9 years @ # 830 625 2351) & San Marcos (Texas State U. plus floating down the Guadelupe River) towards the River Walk of San Antonio OR Fredricksburg (many vineyards @ # 830 868 2321are featured between this town to Llano to Marble Falls back to Austin).

If your into the heat and outdoors then add playing golf at over 26 courses in Austin (5 municipal, 13 public, 7 private courses) in addition to TONS of other courses at many of the neighboring cities mentioned above. Fees range from $11.50 to $16 for the municipal and public rounds.

McKinney Falls State Park is 640 acres just southeast of Austin and just around the corner from Mt.Bonnell is a 227 acre preserve called Wild Basin Wilderness. You should call any of the states parks (Texas Parks and Wildlife at 512-389-4800) for all available options and activities.

Keep a look out for the nearest rodeo going on in a nearby city/town and a favorite of mine is driving to the Caverns of Georgetown to take tours deep inside the ground and see stalagtites and stalagmites.

Air Conditioning Units

2007-07-12T11:57:00.001-05:00

Now that the traditional "hot weather" is upon us, our air conditioning units will begin to work as they are designed to - A LOT. During the process of a property changing hands (Under Contract), often the general inspection raises questions on the health of the A/C.

The Licensed State Inspector performing this 'test' has some tools which tests the temperature of the air coming from the vents. Critical to this test is how the tools are used by the general house inspector. If the property is vacant, and the system has not been running, the test will not be accurate if this tool is basing the temperature of the air as it comes off the hotter metal vent. Like wise, if the system was running at a very low temperature, and the first thing the inspector does is get a 'reading' from the air via the vent, it could show to be too cool.

The result of both of the scenarios mentioned above is that a licensed Heat and Air Specialist needs to be called. If the property has one system, the charge for this visit is usually around $75. If there are two units (traditionally two units or more exist when the size of the heating / cooling space exceeds around 2300sq.ft.) then the charge for both units to be inspected runs around $95.

There are tons of stories about bad business practices, so get a good referral to a business that has taken care of a friend or co-worker of yours for a long time. Repairs often seen from my work in residential real estate are; a need of freon or broken drain line (less than $300 if not under $100) and cleaning the coils (over $300 but typically less than $500).

Just like changing the oil in a car, make sure to switch out the filters more often during this time of year. These filters are critical to keep small pieces of dirt from flowing straight into the system machinery which is located in a hall closet or in the attic. For the outside system located on the side of the property, check on the height of the grass around this area. Make sure the weeds and grass are not growing around it/into it. Finally, keep your dogs away from this outside unit! Something about the freon or other 'smells' of this system attract your dog to wanting to 'mark' it (this could apply more to male dogs than female) AND THIS CAN DESTROY THE ENTIRE OUTDOOR PART TO YOUR A/C SYSTEM.

If you need a referral to 3 or 4 wonderful people you can call, go to the Referral Directory on my web site at www.nativeaustinrealestate.com. Talk to them over the phone and see what you think.

2007-07-05T14:50:00.000-05:00

With the amount of rain coming down in our area, it is likely many water springs that lay dormant will begin to run. I believe this to stem from the increase of water running through the aquifers. When the aquifers dramatically increase their volume of water, springs that are dry 99% of the time come alive. With large tracks of farm and ranch land being developed, the potential for these springs to be in a backyard (or elsewhere near your house) are high.

One year, I had the right inspector locate one in the back yard of a house in Central Austin – 78703 zip code, just off Westover & Mopac. There is nothing you can do except extensive work toward directing the water around the improved structure/house.

French drains are commonly used, and are usually very expensive due to the time, labor, materials and expected performance. French drains are also used if the topograghy around the improved structure/house/building aims at the back of the house or front of the house – again to get the water around and continue its flow away from coming inside.

It was considered the spring located in Central Austin was the result of a number of newer houses being built on previously existing lots with smaller homes (smaller footprints, less concrete, less impervious cover ‘up hill’ than after the new larger homes were finished). Good referrals to Engineers, Hydrologists, Inspectors are great sources to learn more.

The Changing Skyline

2007-07-03T13:34:00.001-05:00

I recently took a 4 hour bus tour of most lofts around Austin. Starting with the release of the Brazos Lofts on 5th back in 1997, I found it fascinating that our ‘’little’’ city of Austin could support lofts in general (and these lofts on Brazos are single story, street level compared to the 40 story plus, skyline-changing buildings today). It is only fascinating because if you’ve lived in Austin longer than 15 years, you know people in other cities of Texas (along with visitors from other parts of the country) always referred to Austin as the ‘’college town’’ or ‘’hippie town’’, and these images don’t match the new Austin of today.

Many jumped on the new lofts quickly, like a roommate I had in 1997. Others were doubtful in 1997 that loft living would be supported over the long term. Today, the discussion centers around not “if” people will live in these building downtown, but “how many” will there be. I have talked with seasoned developers from Austin, who believe someone is going to lose on these high rise lofts, and I have worked with Buyers who believe otherwise. The concern originates from the number of Buyers vs. the number of units available. The optimism stems from factors of:

Austin is a youthful city which will keep the college crowd/new graduates for new ideas and all types of business needs (the younger, college educated 20-somethings have less to lose and will work for a start up or new department – risk takers)
Austin is geographically positioned well for the future markets, with good rail and highway hubs
Austin has a reputation for being open to all races/cultures/spiritual beliefs
Austin was partnered with the Tech industry long before the Dot.com era.

There are roughly going to be around 2343 units made available by the start of 2009 (something could be added or subtracted & of course, these units could encounter set backs on completion). If you break down this list;

785 units in the South
1241 units in the Central/Business District
317 units in the East

Comparing these numbers to the Zip Code Boundaries from the Austin City Connection website here is what you have;
The 78704 (South mentioned above) zip code should grow in population by about 1,000 to 3,000 by 2010
The 78701 (Central/Business District) zip code should grow in population by about 500 to 1,000 by 2010
The 78702 (East) zip code should grow in population by about 500 to 1,000 by 2010

Nobody can predict what will REALLY happen with regards to loft appreciation & loft sales over the next 5 years – no surprise in that statement. The shear number of projects does cause concern over the security in one’s investment for a loft because of the differences associated with living in a loft compared to a house (raising a family, place of employment, simple desire to have pets of heavier weight). History has shown Austin can have 8-10 year runs of appreciation (we have begun one around 2004), and our markets can recede anywhere from 3-6 years (’87 to ’91, ’01 to ’04) for example. Statistically, Condo/Townhome/Lofts are all considered to be the first to dip and the last to fully appreciate when compared to a single family house.

With 2343 units slated by 2009, and low end forecasting from the City of Austin for population growth equaling 2,000 by 2010 – what do you think?

Everyone Can Use a Little Extra Cash

2007-06-29T11:53:00.000-05:00

Here is a great site for all Texans. The Texas Comptrollers Office receives all unclaimed money from government and private business accounts. For example, if you or someone you know had an insurance claim which was paid but not collected (or the check was not cashed), it would show up at the Comptrollers office. In turn, this web site allows anyone to check per name for unclaimed financial assets – check it out, hope you have some hidden money to claim; http://www.window.state.tx.us/up/