The RE/MAX Associates Louisville Real Estate Blog

80 Percent of Americans Unwilling to Buy a House

     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...

Three Simple Ways to Avoid Moving scams

     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...

Mums the Word

     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...

Green Construction Predicted to Grow

     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.


Stop Complicating the Uncomplicated Things

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.


Real Estate Investing: Investing in Short Sales

     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.


Real Estate Strategies

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.


Louisville Home Sales Recovery News

     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...

Adjust to the Market: Five Red Flags to Watch For

     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...

Find a Home With Your Partner

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...

What you Should Leave Behind When You Move

     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....