The RE/MAX Associates Louisville Real Estate Blog

     In October 793 homes were sold in October. This is a 24.3% increase compared to last year when only 683  homes were sold. Upon that only 551 homes were sold in October for 2010. These numbers are only for Jefferson county single-family homes and condos, not multi-family homes.

     It's still the same story, homes prices are rising as well as the sale of homes. interest rates are still incredibly low which means it's a great time to buy a house even for those who are renting.

     It should be noted though that home inventory is on the decline, which allows home sellers to have the advantage over home buyers. The home's condition is still a key factor for home buyers, so if you are interested in selling your Louisville home, make sure that all needed repairs are made and stage the home to show its beauty. Once you do this, your chances of selling your home quickly have just increased.

     In common walls, damage can happen under a variety of reasons. There can be roof leaks, water supply pipe leaks, toilet/bathtub overflows, and washer house ruptures Who is actually responsible for these damages, the owner or or HOA?

     First determine the cause of the damage, then find out if either party was negligent in their maintenance. Next look over the governing documents to determine the guidance there may be for maintenance and repairs. Pay special attention to the definitions of words like: unit, common element, limited common element, maintenance of responsibilities of owners and the homeowner association, insurance responsibilities of the owners and the homeowner  association and enforcement of procedures. The difference often lies within each HOA.

     Normally homeowners are usually responsible for everything that lies underneath the roof, but the HOA is responsible for maintaining the common elements and limited elements. However, limited common elements are usually allocated to the exclusive use of a unit owner, and they may be responsible for repairs. One important principle to remember is that the obligation to maintaining a particular component doesn't really mean there is an obligation to repair it.

     Say the water heater in unit A fails and damages another unit B. From most governing documents unit A bears the expense for repairing the water heater and unit  A. There is no obligation for the damage to cover Unit B. If it was known that unit A was leaking slowly, and they let it leak long enough to damage unit B, the owner would be negligent. On the other hand if unit A erupted spontaneously and damaged unit B, there would be no negligence.

     Bearing negligence each unit owner bears the repairs to his own unit. The same thing applies if there is a leaky roof which is maintained by the HOA. It is...

     There is no perfect home. Too many clients say "I wish I could take this home and put it on that one's lot". There are plenty of Louisville homes. With the size of Louisville, homes are not difficult to find. Currently there are 5,800 single family homes and 1,000 condos. This doesn't even count the vacant lots, multi-family homes, farms. Do yourself a favor and read about the Louisville real estate market and get informed.

     There are not-so-good neighborhoods, houses with structural damage, and you need to become aware of these factors. However, there isn't one thing you cannot read about; and that is the moment when you realize after countless hours of search, you've found the right house. It is the feeling of finding home.

     As a first time home buyer, you may get discouraged after all the searching, but don't get down. It may take awhile before you find the right place to call home, and you may feel that it was all wasted effort. Many clients find the point of frustration right before they find the right home. Louisville adds 20-50 listings every day. So the numbers are out there, just find the right home design that inspires you.

     You will know when a home is right for you when you feel it. You can just walk in and image your furniture in it. You can imagine mowing the grass and everything fits in perfectly and all the small imperfections don't really matter. Your real estate agent will want you to be happy with your purchase, so it is crucial that you communicate effectively to them stating the criteria desired. They will need a feel for what you want and then show you what is available. A good agent will never give up until you find the place that you've wanted from the beginning. 

     Not every home owner is supposed to be the master handyman. But most home repairs are simple and should be easy enough that everyone can do them. Here is a list of the top 10 tools homeowners should have and know how to use.

     Number one is the screwdriver. Invest in both the Philips head and flat head. You can tighten drawers, cabinets, and all the countless children's toys laying around the house. Next you will need a hammer. How to use this is pretty self-explanatory, but they're also useful in removing small nails here and there.

     Get yourself an electronic drill. I prefer battery operated ones vs. ones with the cord. Countless home projects can be solved with a drill. Pliers are a really handy tool. You will find ways to use them everyday if you try. Tightening and loosing bolts are a prime example of how they're used.

     Get a tape measures. Measuring things left and right is always useful. Next get yourself a shop vac. These machines can clean anything everywhere. They're good for removing standing water, cob webs in hard to reach places, and anywhere holding dirt in a crevasse.

     Exacto blades are an awesome tool. Opening boxes, cutting perfect angles, cutting roof shingles, etc. The list can never end with this tool. Get one! Chop saws might intimidate some home owners, but they're great for cutting trim, moulding, and even decks. Finally use a level to hang the perfect frame. Sometimes our eyes deceive us, so get a level and make it perfect.

     All these tools can be used by anyone, male or female. They are great for simple home projects and hold a lifetime value. They will be good for hundreds of repairs. You'll save money doing things yourself and have a sense of pride that you did it yourself.

     More and more people are living in rental properties today now than ever. This means investing in one can be extremely lucrative. As with any real estate investment, a rental investment has risk. It also requires tedious research, but the risk and rewards can pay off. You need to take into account the considerations before taking the step out on that branch. If you have no prior experience, you need to ask yourself a few key questions.

Money Matters- first look at your financial situation. What kind of down payment can you make, and how much of a monthly mortgage payment can you afford? How much will you need to make in monthly income in order to keep up with the monthly payments? Do you have enough of an emergency fund to handle vacancies in a down period?

     It's not a bad idea to get pre-approved for an investment property loan, and then secure the service of a real estate agent to help you find the type of property you desire.

Location Matters- You obviously don't want to invest in an area where no one wants to live, so find a place where people do want to live. Consider the proximity to transportation, schools, and shopping, as well as the areas crime rate. These are the same considerations you would look at if you were buying a home for yourself. Next decide what kind of property you want to invest in and what interests you. Are you wanting a single, or multi-person dwelling property. Condos? An apartment complex? A vacation destination?

     Once you've decided upon the property type, you will need to look at whether or not you have the financials (and time) to handle a fixer upper. If not, be ready to buy a place that has minimal necessary up-front fixers. You will also need to think about how much rent to charge based on the area and amenities the property offers.

Management Matters- Are you ready to manage...

     The Louisville Housing market is showing tremendous signs of recovery, but we are not out of the woods yet. One of the healthiest things a market can show is construction. It means people are working, people are investing, buying, and selling. It also shows consumer confidence.

     Tara Brinkmoeller is the Director of Public Affairs and Communication for the Home Builders Association of Louisville. She had an interview recently, and here's what she had to say.

          "We hear things are actually getting better. Our Homearama this year was outstanding, which took place in two sites and most of the Homearama homes sold,and a couple with multiple offers."

     Precise data isn't easy to come by due to the nature of the construction phases. Many homes are sold via contract, but some homes are made to spec, so these homes won't be listed in the MLS or listed in the data.

     For this reason the HBAL gets its permit building data from local governments. So far for 2012 1,079 building permits have been issued, which is up from 1,027 from the entire 2011 year. David Crowe, an economist  for the HBAL predicts that building permits will rise to 4,500-5,000 by 2015. Hopefully he is right, but that's a 350% increase.

     Brinkmoeller also mentioned that she noticed a trend in Louisville, noticing better usage of space with much less waste. They want space that can serve for many purposes. She also pointed out that outdoor living spaces like screened in porches and fire pits are on the rise. They flow with the interior of the home.

      We are on the rise!

     One of the leading problems for first time home buyers is being able to assess the condition of homes from the start. It's easy to tell a top conditioned home compared to a lousy home, but first time home buyers have difficult evaluating the properties that are in between. Here is a small blog that will help you identify home conditions from the star, knowing what the real estate agent is talking about. 

Problems start at the bottom

     We start with the floors. Most houses and apartments constructed with a base, called the foundation. This is often just concrete poured in a flat sheet on the ground. The weight bearing system is above that called the sub-floor. The sub-floor is often times a weight bearing system set up with pieces of wood, and smaller pieces of wood connecting them. Then a smaller floor is laid on top of that which usually consists of hardwood, oak, or bamboo planks. The floor that is laid is usually depending on what the room is used for. For example, bathroom floors are usually tile that are laid on top of concrete. This is because wood would not hold up well with exposed water all around it.

Cracked Foundation

     Picture a house like a wedding cake, there are layers upon layers, and the whole cake would be ruined if the bottom layer was ruined. Like buying a house, it is essential to watch for cracked foundations. This can cause major problems in the value, and the upkeep of your home. Construction companies will fix this by lifting your entire house, fixing the crack and lowering it back down again, and this is extremely expensive.

Mismatched Heights

     Another problem that can happen is different floor heights. Either the floor rises, or lowers in different parts of the same room. Pipes may need to run through one room and cause rising floors, which is disastrous....

     The Federal Reserve has acknowledged Wednesday to keep the interest rates low. They said the economy is beginning to look up, especially in the housing industry. They also claimed they will continue to press forward with the stimulus campaign- which will keep interest rates low- until the economy shows more muscle. 

     At the last meeting, the Fed said they would keep rates incredibly low until about mid 2015. A program known as "QE3", in which the Fed buys $40 billion in mortgage backed debt every month, helps keep the rates incredibly low.

     However, on the flip side, the Fed is a bit concerned. In a statement they made recently, they said, "The committee remains concerned that, without sufficient policy accommodation, economic growth might not be strong enough to generate sustained improvement in labor market conditions."

     Even though the unemployment still remains high at 7.8 percent, the fiscal cliff still looms at the end of the year, the global economy is struggling, and the U.S. GDP grew only by 1.3 percent for the second quarter.

     Incredibly record low mortgage rates and low home prices aren't enough to encourage Americans to go through the process of buying a house. Even as the market has slightly picked up, still four of five Americans will not buy a house or even refinance their mortgage. A major factor contributing to this is the lack of jobs.

     Economists expected 125,000 new jobs in August, but we were only given 96,000, according to the Labor Department. The unemployment rate fell to 8.1 percent, but only because more discouraged workers left the labor force. So that doesn't really say much. Only workers between the ages of 18-34 were slightly more likely to invest in housing over the next year.

     With record low interest rates, Union Plus launched an awareness campaign for Union members to learn more about the advantages of buying a home. "With only 18% of working families willing to invest in buying new homes, what this tells us is that we need to help working families feel confident about investing in housing" says Union Plus President Leslie Tolf. Confidence comes in knowing the benefits of owning a a home.

APPRECIATION- the largest benefit is appreciation, and right now that's a much better bet than it has been in years. Appreciation occurs when the value of a home increases due to supply and demand, home improvements, and other factors. It acts as interest on an investment. It taps as equity you can use for other investments like starting your own business. sending your kid to college, or other possibilities.

     Acquire enough equity and you can upgrade your house, move to a nicer neighborhood, or even downgrade and save the rest for retirement. many homeowners rely on equity as they nest egg to use during retirement.

TAX BENEFITS- Homeownership is the mother of all tax shelters. The mother of all tax breaks is the deduction for...

     Everyone knows the complexities of moving, but it can be much worse when you realize you've been taken advantage of by a mover who has several operating rings out there. that's why it's critically important that consumers are put in a position to know how to avoid being scammed. Not only will you be able to have that piece of mind knowing you didn't get ripped off, but you will also be able to feel the enjoyment of your new home. Keep these three things in mind when moving.

     1. Get Multiple moving Quotes- The best way to spot a scam from the beginning is to compare competitors. Try at least five different moving companies. Having five different quotes will allow you to see the average price range for their service, and spot which ones are looking to take more of your wallet. If you see another company that is drastically lower than the rest, you should immediately think there is something wrong.

     2. Get Binding Moving Estimates- A binding moving estimate is just a legal document reporting everything about your move, including the costs that you will pay from the company. This is the contract you and your moving company will have to abide by. When you have a regular moving estimate, there is no law stating that the movers have to abide by it. However, if you have a binding estimate the movers cannot charge you more than 110% of what the cost is.

     3. Know the Best Moving Practices- Know what you're getting into, how to go about dealing with movers, and know what your rights and responsibilities are so you know you will not be taken advantage of. From tipping, to dealing with demands for deposits when scheduling your move, do some research to know how to handle each aspect of the moving process. Be sure to look at the Federal Motor Carrier Safety Administration's website designed to specifically for consumers who are moving. In the end, knowing how to protect yourself...

     Fall is obviously the end of summer, but this season still holds opportunities to amp up your home's curb appeal. Curb appeal is important for several reasons. We judge the condition and value of a home on first impressions. This is why staging and cleaning a home before buyers see it is very important. Curb appeal is a giant factor in creating excitement for a home and luring in new buyers.

     If a buyer drives by a home that has an ugly lawn, chipped painting, weeds everywhere, they will probably assume the inside is just as disastrous. They will be looking for a good first impression, and Fall will give you the opportunity give them that first impression.

     It's time to add color in the fall season to reinvigorate life into your property. Fall colors like orange, dark reds, browns, and yellows are the perfect colors to give your home a good feel. Mums are a good and inexpensive way to add brilliant color. Be sure to buy mums that have a lot of unopened blooms. If they already look awesome it means they are nearly done with their blooming cycle. Mums can be planted directly into the ground, in a pot, and they even look great around your mailbox.

     Another great fall plant is the pansy. These flowers last quite awhile into the winter and look awesome for beds. Seasonal decorations get people into the holiday spirit, just remember that too much is considered less tasteful. Less is more.

     Pumpkins are always a great idea. Try different sizes, shapes, and colors. Wreaths can also infuse color and fun into the season. They always look terrific on your door, so hang it there and see how you like it. They can be removed at the end of the season without any damage to your door.

      As the final step be sure to tend to your yard. this means keep the grass mowed, leaves raked, bushes trimmed, etc. Revitalize your home...

     Green home construction is expected to grow significantly in the next four years according to the latest McGraw-Hill construction Smart Market Report. In 2011 the green home share was expected to grow by 17 percent, but that number for 2012 is expected to grow by an unbelievable 29-38 percent into 2016.

     In the current market there is a need to differentiate your homes from others. When builders can build green homes, they are not only offering higher quality, but higher value, and have a major edge over the traditional houses being built.

      Consumers want green homes for several reasons. First is they will save themselves money in the long run. Also these homes are perceived as higher quality. There are other factors that are driving green home growth. Two-thirds of builders have found that their customers have been requesting green homes in seek of lower energy costs.

     The higher costs of building green homes is less of a factor now than it was four years ago. The supply of green resources has increased which lowers the price of their cost for builders.

     There has surely been a shift in the market since green homes have taken charge of the market. The report found that 80 percent report that energy efficiency is making today's homes greener compared to the past. Energy efficiency is a huge feature that is growing in the market. It has become the top practice among builders and remodelers. 

     Another top consideration is indoor air quality. 95 Percent of green home builders are using this feature to attract their customers. These findings confirm the shift we have seen in the market. The factors that seem to be driving the market today are energy effeciency and sustainable waste management practices.

Things today are over complicated. There is paperwork for everything. There are special passwords for different accounts, special characters for each password, cannot have numbers in that password for this account etc. The markets (any market) are so specific.

     A market is only as good as its basic participants. One person has something to sell while the other wants to buy. If these happen to be the same thing, then both parties would find the value of that something and make a sale or transaction and swap resources. Simple. If there are enough of these transactions then you have yourself a market. depending on which political party you are talking to, or which news station you are watching, they'll tell you different interpretations of the same information regarding any market. But the complications come in when there are artificial interferences that happen  to change the market. No one likes complicated issues, so why don't we break it down to its simplest elements.

     Shelter is a basic necessity of life, everyone needs it. As Jim Weichert says, "if it has a door and you can finance it for 30 years at 5%, buy it", or something close to that. It really doesn't get much simpler than that. one person wants a home, and one person is looking to sell it. It is the real estate agents job to get those people together to work out price, time, and all the other factors involved. The agent has created their own market if they do that enough.

Make your own market, make it simple, and make it uncomplicated.

     If you don't know what a short sale is, ask your agent. In the mean time I'm going to try and explain it for you. A short sale is the sale of a piece of property that is sold for less than what is owed on the property. The proceeds of the sale are much lower than what must be paid back on the mortgage. This usually happens when a borrower cannot pay their mortgage, so they decide to sell it for what they can instead of foreclosing. They would rather take a loss than foreclose.

     The process: Both parties agree to the short sale process in order not to completely be sunk. They avoid a foreclosure with is a mess in itself. There are hefty bank fines, credit score annihilation, and social embarrassment.  However, this doesn't mean the borrower isn't responsible for paying back the rest of the loan that they still owe. This is known as deficiency.

     The bank or lender also agrees to discount the amount owed due to knowing the economic hardship the borrower is going through. Once the debtor sells the property for less than the outstanding balance of the house, they return the proceeds over to the lender.

Here are a few quick tips to understand the real estate industry.

1. Always understand insurance, it will let you know change. Understand every aspect, every sentence of it. Ask your agent if you are confused by something.

2. Never keep a building empty.

3. Never buy a property that has no equity.

4. Only sell out of necessity.

5. House prices can fall, as well as rise.

6. make sure you have a good deal if you are going to buy.

7. Always compare mortgage rates.

8. Take expert advice when looking for a home inspector.

9. Create leverage.

10. Always check terms of contract. Make sure you understand and agree to the terms.

11. Look for properties that require little work. If much work is needed, make sure you are up to the task physically and financially to perform the tasks.

     The new home sales numbers for Louisville are out, and there's good news. For the sellers the homes going under contract are up 17.3%. The homes that actually closed in September 2012 compared to September 2011 is up 12.73%. These numbers show an incredibly strong growth spurt for a weak housing market. Just last week the Courier Journal claimed Louisville dodged the recession for the past five years, but with numbers like these, we seem to be bouncing back quite well. 

     The good news for sellers is that average price of homes being sold is up 3.1% compared from this September from last September. This is just an overall number, because some parts of Louisville actually trended backwards. There were other parts of town that were flat, like St. Matthews.

     Sellers who made minor and major upgrades to their properties found their property sat on the market an average of 12.8% fewer days than those who did nothing to their property. But there is a trend that is catching on. Buyers are becoming smarter about buying homes with upgrades. It is called the HGTV effect. Cable has taught buyers the right and wrong ways to buy a home and what to look for when doing so.

     Some good news for buyers is the interest rates remain below 3.5% and as they hear the economy is recovering and home prices are rising, homeowners will start putting their homes on the market. the news media needs more information out about the recovery so sellers will step forward and put their homes on the market. We are hearing reports about the recovery, but not much else.

     Louisville hasn't suffered a huge loss yet, and probably won't get to the point where homes become scarce and and the market becomes the seller's market. Some places in the country homes are receiving multiple offers as soon as they're put on the market. This is supposed to happen, but not in an economic downturn...

     You've encountered a problem. You have done everything your agent has told you to do when you put your home up for sale three months ago, and still not a single offer. You've followed your agents every piece of advice, done some remodeling, let them show your house on short notice, and not even a nibble.

     It's assumed when you want to sell your home you'll get an agent and take their seasoned advice. they often promise selling your home, but sometimes they fail. Why? Because the pool of buyers in a particular market determines the saleability of a home, not the agent, insurance agent, mortgage brokers, title companies, or even home owners. Home buyers can be a fickle group to tangle with. They can turn away on a dime for the simplest reasons. This is why it's so easy to make a mistake when positioning your home, and why it's critically important to adjust your strategy when needed. Here are five red flags to watch for:

1. No Showings- the average home buyer will look at 10-15 homes before buying one. If you are having few or no showings as the weeks pass, it is simply stating that buyers are rejecting your price. They are seeing your home on the market, but they are rejecting is as quickly as they see it because of the price. So adjust the price.

2. No offers- if you have viewers, but no offers all this means is buyers are rejecting the home itself, not the price. There are two solutions to this problem. One is to interview the buyers to see what they didn't like about your home and fix those issues. The next solution is to adjust the price to compensate for the cost of fixing the parts they do not like.

3. Low ball Offers- If you've received several low ball offers this means that buyers don't see the same value in the house as you do. To fix this you may want to allow your agent to show them the appraisal value of the home. Also you may want to provide the buyers with...

When you are single, it is advised to get an apartment. You really don't need that much room, and if you have a decent job, you can afford rent by yourself. If it is certain you can afford it, consider buying the apartment. Fast forward to the time when you are ready to buy a house. Hopefully you have a spouse to contribute to the mortgage. When you are searching you'll consider several different neighborhoods, house types, and other aspects.

Here are 5 aspects to help you search for your home with your partner.

1. Discuss Expectations- You should discuss your desired space and budget before you go look for houses with an agent to avoid any awkward moments while the agent is doing their job. A lot of expectations are reached by something similar to what you grew up in. Get a firm framework before you just blindly go into the market looking for something to throw your money at.

2. Define Dealbreakers- find a price range you will both be comfortable with. Also have some similar agreements like a house with pets. Do you want to be stuck in a place where there are no pets allowed, when you might want one down the road.

3. Figure out Finances- it doesn't have to be even if both sides consider it fair. Figure out with your spouse what each of you can contribute to make it fair. maybe one of you pays the mortgage while the other pays the bills. what about an emergency fund, or the down payment? Just come to a mutual agreement on what is fair. It doesn't have to be set in stone for 30 years, there is always room for renegotiation with your spouse.

4.Work out an Escape Plan- today's rates of divorce are 50% and knowing that is half the battle. Devise a plan with your spouse to what will become of the property if you do end in divorce. Marriage today is like spinning the roulette wheel-red or black. come up with an agreement if it doesn't work out, like one buys the other out, sell the property and split the...

     So you've sold your home, good job, now comes the annoying part of packing. Gather up all the pots pans, toys, clothes, photo albums etc. and store them in multiple boxes. What about all the things you are questioning keeping or leaving? Some of these items are contractually obliged to stay with the new owner, and some of the items should just be left out of kindness.

Let us have a look at the leave behind items:
     Appliances: Leaving behind your appliances was probably in your sales contract. These appliances are your refrigerator, dishwasher, and washer and dryer. It is important that you follow the contract requirements exactly as they're spelled out.

     Manuals: You should leave the new homeowners a folder filled with the appliance manuals. This is just courteous considering you have no use for the manuals anymore.

     Extra Keys: Many homeowners will change the locks once they move in, but you should leave them any extra keys you have to garage doors, sheds, back doors, etc. The new owner will appreciate not having to make new copies immediately.

     Security Alarms and Garage Door Codes: There is not a single thing more frustrating that having a nice garage door with a key pad and no codes, or resetting instructions. Be a kind person and just leave those behind.

     Warranty Information: All the warranties in y our home will be transferred to the new owners.

     Service Contracts:  It takes a new homeowner a little while to gain their bearings. If your house requires service like pool cleaners, lawn care, handymen, etc. leave the new owners with recommendations to save them some time.

     Finally if you have a pile of junk you don't want anymore, throw it away. Don't...

The average price per square foot for a Louisville home is $130, which is actually up 30% from a year ago for the same period. The median sales price for homes in Louisville was $202,644 (based on 62 home sales). Compared to the same period one year ago, the median home sales prices have increased 47%, however the number of home sales has decreased 96.6%. Currently there are 3,671 resale and new homes on the market in Louisville. The homes in re-sale, foreclosure, and auction are at 2, 864. The average listing prices for Louisville homes for sale are $212,983. This number tells us that there has been a decrease of .3%, or $632 compared to the prior week. The popular neighborhoods in Louisville include Old Louisville, Cherokee Triangle, with the average listing price of $217,777, and $449,094.

Just a little market news.