Mary's Blog

Market Condition Advisory

Mary Monday (RE/MAX Peak Properties) — Wed, 24 Feb 2010 12:37:11 -0800

Back in the old days three to four years ago when everything in the real estate world was hunky dory no one thought or seemed to care about what the market may look like in a few years. Life was good and if you bought real estate you could expect its value to increase. Then quite suddenly conditions began to change. The real estate market suddenly went south and property owners who had bought during those times found themselves in properties that were worth far less than when they had purchased.

Given the declining real estate market the past couple of years, The Arizona Association of Realtors in August of 2009 developed a one page paper entitled "Market Conditions Advisory". The advisory is a form now used by many realtors when negotiating a contract to advise both buyers and sellers about potential future market conditions. Buyers and sellers are asked to read and acknowledge by signing the document.

The form states in part:

•§ The real estate market is cyclical and real estate values go up and down. The financial market also changes, affecting the terms on which a lender will agree to loan money on real property. It is impossible to accurately predict what the real estate or financial market conditions will be at any given time.

•§ The ultimate decision on the price a Buyer is willing to pay and the price a Seller is willing to accept for a specific property rests solely with the individual Buyer or Seller. The parties to a real estate transaction must decide on what price and terms they are willing to buy or sell in light of market conditions, their own financial resources and their own unique circumstances.

•§ The parties must, upon careful deliberation, decide how much risk they are willing to assume in a transaction. Any waiver of contingencies, rights or warranties in the Contract may have adverse consequences. Buyer and Seller acknowledge that they understand these risks.

There is more to the document that I have not included in this article, but I think you get the point. The intent is that all parties to a real estate transaction should understand the implications and risk of buying and selling real estate. No one knows what the market will be like tomorrow, next year or in five years. If you are interested in viewing the entire advisory I have posted a sample copy on my website at www.marymonday.com/docs/mca.pdf.

Northern Arizona Real Estate Trends

Mary Monday (RE/MAX Peak Properties) — Wed, 10 Feb 2010 21:07:31 -0800

As we enter a new year and a new decade there are signs that the storm clouds hanging over the real estate market in Northern Arizona the past few years are beginning to break. At a recent business meeting which I attended there seemed to be a consensus that the real estate market nationally will remain flat and perhaps drop a bit this year. The market should then begin a slow recovery in 2011 and the recovery should continue into 2012. If the economist, planners, and fortune tellers are correct by the end of 2012 we should be back to a near normal market.

The major problem in our local area this year will be the continued rise in foreclosed and bank owned homes. As I wrote last month the number of foreclosures we experienced in 2009 was a fraction of what is expected for 2010. The result of these foreclosures is reduced values for everyone's property. Another problem is the certainty that mortgage rates will rise this year making homes a little more unaffordable.

While the real estate market has been terrible in many areas this past year, Flagstaff has shown some surprising resilience in both the number of homes sold and value of those properties. Each year my January article is written to show how last year's real estate market in Northern Arizona has preformed compared to previous years.

To see the trends in graph form and to view statistical reports for other property types in 2009 you can visit my web site at www.marymonday.com and go to Flagstaff Real Estate Trends under the Seller's Resources link.

The average price of $338,452 for 2009 indicates a drop of about $33,000 from the average 2008 price of $371,515. The median price for single family homes in 2009 was $290,000, down from $324,000 in 2008. The number of homes sold by year shows activity picked up with an increase of 66 homes sold in 2009 over 2008.

While our market has had its share of down periods, when compared to other areas in the state I think we are fortunate that our values have not dropped to the same extent that some of our neighbors have. As we move into 2010 the future of our real estate market appears to be steady as you go. The wildcard is the number of foreclosures we will endure, and the effect those may have on home values.

The Countdown has begun

Mary Monday (RE/MAX Peak Properties) — Mon, 14 Sep 2009 18:03:37 -0700

As we move from summer into fall, the countdown has begun for first time purchasers to earn a homebuyers tax credit of up to $8000 on their 2009 federal income tax. The American Recovery and Reinvestment Act of 2009 provides the credit to home buyer's who have not owned a home in the past three years. To qualify for the full $8,000 tax credit, couples filing jointly must earn less than $150,000 in adjusted gross income for 2009 and the home must be closed on by November 30 of this year. The credit will go away on December 1, 2009. The refund is a true tax credit; not a deduction. In other words if your tax bill for 2009 is $8000 and you have earned the full tax credit your final tax bill is $0.

To educate yourself on the value of this once in a lifetime opportunity, go to the internet and conduct a search for the credit. There are countless articles, videos and blogs describing the merits of the legislation. The National Association of Realtors web site at www.realtor.org contains a wealth of information describing the eligibility and value of the program.

There is some movement by various organizations to get the tax credit extended and expanded, however as I write this I know of no legislation being considered. With time getting short some mortgage lenders, realtors and economist are predicting that there will be a rush of people who want to buy and close on a home before the deadline passes.

Some statistics indicate that many people have not yet heard of the tax credit, so if you or someone you know may qualify and be interested in buying a home it is imperative that they move quickly. The first order of business is to visit with a mortgage lender. We have many here in our community who are knowledgeable about the credit and are ready and able to assist in getting you pre-qualified for a loan.

If you are considering using this gift from Uncle Sam time is of the essence. You must act soon as time is getting short! My advice; don't look back in a few months and say; I could have, should have, would have, it may be too late.

IS A TOWNHOUSE OR CONDO THE RIGHT HOME FOR YOU?

Mary Monday (RE/MAX Peak Properties) — Mon, 17 Aug 2009 17:13:47 -0700

If you have followed the local real estate market the past year you know that townhomes and condominiums have become popular with home buyers. Town homes are more affordable than single family homes, making them more attractive to first time home buyers. Town homes and condos are gaining appeal not only for primary homeowners but also for second home buyers who are looking for a weekend get-a-way to Flagstaff as well as for parents looking for a place that their kids can live in while they attend NAU.

In many cases a town home or condo may be a better investment than a single family home. To ensure that you make a good investment, review what your objectives are for purchasing the unit and what location would work best for you. Is it going to be a second home, will it be a place for your kids to live while attending school, is your objective an investment property that you plan to use for a rental, will it be your primary residence?

The difference between a condo and town home is sometimes a bit hard to discern. The best definition I have for a town house is that it is a type of ownership where individuals actually own the building or unit they live in and the ground below it, but common areas are owned jointly with the other members of the development or association. In a condominium, an individual owns the airspace in the unit, but the buildings and common areas are owned jointly with the others in the development or association.

When you purchase a condo or townhouse you automatically become a part of a homeowner's association to which you pay dues. The dues cover the cost of maintaining and insuring the common areas. The complex where the property is located is governed by CC&Rs (Covenants, Conditions and Restrictions), which restrict your ownership rights. Read and understand the CC&Rs and any other pertinent governing documents before you complete a purchase.

The past few years have seen a number of local apartment complexes converted into Condominiums. Many of theses projects have an abundance of amenities such as swimming pool, basketball courts, and fitness centers. These units are especially popular with young people.

There are many bargains in our town right now so if you are in the market for a Townhome or Condo it is a good time to start looking. As in any real estate transaction it all comes down to location and what works for you.

Understanding today’s real estate market values

Mary Monday (RE/MAX Peak Properties) — Thu, 16 Jul 2009 15:30:30 -0700

Back in the old days determining the market value of real estate was a fairly straight forward process. An agent would obtain sales records from comparable properties for the past few months and with input from the property owner a value would be determined.

In today's market the concept remains the same, however there are some new considerations that must be taken into account. First and foremost is the number of foreclosure and short sales that have occurred in a market area. When these sales are factored into a comparative market analysis (CMA) the result is often a shock to prospective sellers.

This is the situation that has put buyers in the driver seat in our current market. But whether you're a buyer or a seller, knowing the fair market value of a home is important. It can make the difference between a quick sale or having a home languish on the market for months or even years. If you are a buyer, knowing the comparable sales in a market area gives you confidence in the negotiation process. If you are a seller as distasteful as it may be, you must consider the effects of foreclosures and short sales on the value of your property.

Market value is defined as; "The most probable price a property should bring if payment is made in cash and the buyer and seller are unrelated, well informed and acting without pressure". Just as each property is unique, so are buyers and sellers. Emotions, desire, and the necessity to buy or sell all play a part in the negotiation process even when the market value is known by both parties. Even with all of the comparable sales information from a CMA, arriving at a fair market value is an art and not a science. All the numbers and data considered; each house is a unique property at that moment and time.

A professional Realtor, with knowledge and experience in the market and in dealing with people, can help both parties reach an agreement on the value of a property. When all is said and done the true value of a property is the amount paid at the time of closing.

What "As Is" means when buying Foreclosure or Distresses Properties

Mary Monday (RE/MAX Peak Properties) — Thu, 04 Jun 2009 16:02:45 -0700

As we continue in this cycle of short sales, foreclosures, and other distressed property transactions "As Is" sales are becoming more and more common. Banks and other lending institution who acquire a home through foreclosure usually have no idea what the property looks like and whether there are any material defects that should be disclosed.

When this occurs, the institution usually offers the property for sale in "As Is" condition. This means that the seller makes no warranty to the buyer either expressed or implied as to the condition of the premises, the zoning of the premises, or the premises fitness for any particular use or purpose. However "As Is" does not relieve the seller of the legal obligation to disclose all known material latent defects to a buyer.

An individual considering the purchase of a property in "As Is" condition should proceed carefully. Upon negotiating a contract, the buyer should conduct an independent inspection and investigation regarding the premises. Upon completion of the inspections and any other investigations, the buyer can ask the seller to repair those items that may be health or safety issues. However most institutions who are conducting a distresses property sale will be reluctant to make repairs as they are likely losing money on the transaction.

In Arizona, members of the Arizona Association of Realtors use an "As Is Addendum" which is included with a listing contract. The real estate agent representing the seller will have included it in the listing agreement and a buyer must sign that they acknowledge the risks associated with buying such a property. I have posted a sample of the addendum here.

My best advice is to enlist the services of a competent realtor if you decide to purchase a distressed property in "As Is" condition. You will be glad you did.

Don’t kick yourself for your inaction

Mary Monday (RE/MAX Peak Properties) — Mon, 27 Apr 2009 16:23:39 -0700

While I am not an accountant and don't give tax advice I do know a great opportunity when I see one. Therefore I felt it imperative that this month's article address the tax incentives that are provided in the economic stimulus bill recently passed by congress with regard to real estate.

First there is an up to $8,000 tax credit for first-time homebuyers. A first-time homebuyer is anyone who has not owned a home in the past three years. To qualify for the full $8,000 tax credit, couples filing jointly must earn less than $150,000 in adjusted gross income for 2009 and the home must be closed on by November 30 of this year. The credit will go away on December 1, 2009.

Second there are green tax credits for homeowners. There is now a $1,500 lifetime tax credit for home improvements such as energy-efficient windows, doors, mechanical systems and insulation. Homeowners can take a 30% tax credit for every dollar they spend on green upgrades like solar heaters, heat pumps and fuel cells. The credits apply through 2010.

It's important that you as a buyer or homeowner understand that tax credits are a great form of tax relief. They are a direct dollar-for-dollar reduction of your tax liability - and for first-time homebuyers, if the credit is larger than the tax liability, you get a refund! As a prospective home buyer you should obtain advice from a professional tax advisor to see what tax credits you may be eligible for.

Real Estate prices in Northern Arizona are the most affordable they been in the past few years. If you qualify for a loan there is no better time than now to invest in a home. Interest rates are low and with these tax incentives, a home buyer cannot help but come out ahead. The National Association of Realtors has recently developed a brochure entitled "It's a Great Time to Buy". You can view an electronic copy on my web site at www.marymonday.com/documents/brochure.pdf. There are several hyperlinks within the brochure that expand on the tax credit and home buying information.

My advice; don't walk by a house that you had considered buying and kick yourself because someone else is moving in. It will happen!

Insurance loss history in a real estate transaction

Mary Monday (RE/MAX Peak Properties) — Tue, 23 Dec 2008 16:38:08 -0800

As buyers become more fickle and remain in the driver's seat when it comes to a real estate transaction, sellers must be aware of potential pitfalls when they receive and accept an offer to purchase. An issue that can affect a transaction is any previous insurance losses a seller may have incurred with regard to the property being sold.

To prepare for an inquiry about loss history on the home you are selling you should obtain a loss history report from your insurance agent or a Comprehensive Loss Underwriting Exchange report (CLUE). The Comprehensive Loss Underwriting Exchange is a national insurance industry database which details many million property claims. A CLUE report examines all claims reported to an insurance company for a given property over a five-year period. The report is a guide for the buyer to help verify the seller's property disclosure statement, as well as well as help a home inspector ensure reported damage has been properly repaired.

The Arizona Association of Realtors Residential Purchase Contract requires that the seller provide the buyer with a written five-year insurance claims history regarding Premises (or a claims history for the length of time Seller has owned the Premise if less than five years) from Seller's insurance company or an insurance support organization or consumer reporting agency or if unavailable from these sources, from Seller, within five (5) days after Contract acceptance.

If you have owned a property for five or more years and had the same insurance company ask your agent to provide you with a loss history report. If you have changed insurance companies within the last five years you can obtain a CLUE report, on line at www.choicetrust.com, the cost is $19.95 per address. Be sure to order the home sellers disclosure report as it does not divulge any of your personal information.

Why you need Title Insurance now more than ever

Mary Monday (RE/MAX Peak Properties) — Thu, 30 Oct 2008 15:50:32 -0700

Lately we have been inundated with reports of real estate foreclosure auctions, short sales, distressed property and seized property sales. If you are contemplating purchasing real estate through one of these means you should consider the many pitfalls that you may encounter. Of utmost importance is that you secure a clear title to the property that you are purchasing. In order to accomplish this, it is necessary to purchase title insurance. There are two types of title insurance, Owners coverage, and Lenders protection.

Owner's title insurance ordinarily is issued in the amount of the real estate purchase and lasts as long as the insured have an interest in the property concerned. Lenders title insurance decreases and eventually disappears as the mortgage is paid off. Lenders require mortgagee title insurance as security for their investment in real estate, just as they will insist on hazard insurance and other types of coverage as investor protection.

An important part of title insurance is its emphasis on risk elimination before issuing a policy. This means that you, the insured have the best possible chance for avoiding title claim and loss. Title insuring begins with a title company doing a complete search of public land records for matters affecting the title of the property being insured.

A common term used in the real estate business is "cloud on the title". Some examples of clouds that can be of concern are: Outstanding mortgages, judgments, and tax liens. Also easements on the property that have not been recorded can create problems.

However even the most careful preventive work may not locate all hidden clouds on the title. As the name implies title insurance offers financial protection against hidden hazards. With title insurance, a home buyer can enjoy protection against future claim and loss.

We have several title companies in Northern Arizona; most are members of the American Land Title Association. Make sure you are fully protected; insist on a title insurance policy from one of these companies when you buy real estate regardless of who the seller may be.

Who pays what cost in a real estate transaction?

Mary Monday (RE/MAX Peak Properties) — Wed, 10 Sep 2008 18:57:59 -0700

One question that I am frequently asked by clients is: which services are they expected to pay upon the closing of a real estate transaction? While the answers vary and most expenses are negotiable the following table indicates who customarily pays for the service. The table includes three categories Cash sale, Federal Housing Authority (FHA), and conventional loans. There may be other cost that are not included, however the list includes the most common real estate, loan and title fees that are incurred in a real estate sale.

I have purposely excluded Veterans Administration guaranteed (VA) loans from the table as there are some strict guidelines associated with VA loans upon where there are no negotiation. FHA loans also have some requirements that cannot be waived. With the recent news that Fannie Mae and Freddie Mac have been taken over by the federal government there will undoubtedly be some new guidelines that will affect both VA and FHA loans.

	Cash	FHA	Conventional
Down Payment	Buyer	Buyer	Buyer
Pest Inspection	Buyer	Buyer	Buyer
Property Inspection	Buyer	Buyer	Buyer
Property Repairs	Seller	Seller	Seller
Loan Origination Fee		Buyer	Buyer
Document Preparation Fee		Seller	Buyer
Discount Points		Buyer	Buyer
Credit Report		Buyer	Buyer
Appraisal Fee		Buyer	Buyer
Existing Loan Payoff	Seller	Seller	Seller
Next Month's Loan Payment		Buyer	Buyer
Taxes	Prorate	Prorate	Prorate
Tax Impounds		Buyer	Buyer
Hazard Insurance	Buyer	Buyer	Buyer
Flood Insurance		Buyer	Buyer
Homeowners Association Transfer Fee (HOA)	Split	Split	Split
Current HOA Payment	Prorate	Prorate	Prorate
Home Warranty	Negotiable	Negotiable	Negotiable
Real Estate Broker Commissions	Seller	Seller	Seller
Title Insurance	Seller	Seller	Seller
Escrow Fee	Split	Split	Split
Recording Fees	Split	Split	Split
Courier/Express Mail Fees	Split	Split	Split
Email Loan Documents		Buyer	Buyer

If in doubt ask your realtor, loan officer or escrow officer about what cost you will incur. The best advice I can offer is that if you want to negotiate the cost of a service do so, when you are negotiating the purchase contract.

Mary Monday is an Associate Broker at
RE/MAX Peak Properties

She can be contacted at:
(928) 779-9090
Mary@MaryMonday.com
www.MaryMonday.com

Negotiating in a Buyers Market

Mary Monday (RE/MAX Peak Properties) — Thu, 14 Aug 2008 14:11:56 -0700

As we look at events of the past year in the real estate industry it has become apparent that we are now in a buyers market. Sellers who receive an offer to purchase are often dismayed at the low price buyers are bringing to the table. While both parties to a transaction want the best deal they can get it always comes down to negotiation. Here are a few thoughts which may help your ability to work with the folks on the other side of the transaction.

Negotiating a purchase agreement is perhaps the most stressful aspect of a real estate transaction. Most home buyers and home sellers want to reach an agreement that is amicable to both parties, often referred to as a win-win agreement. Successful negotiating encompasses the learned ability to use certain skills and techniques to bring about win-win results.

Start with a fair price and a fair offer. There's no question that significantly overpricing your home will turn off potential buyers. Likewise, making an offer that's far lower than the asking price is practically guaranteed to alienate the sellers. Asking and offering prices should be based on recent sales prices of comparable homes. Buyers and sellers in Northern Arizona are usually assisted by a competent real estate professional who knows the local market.

Respect the other side's priorities. Be prepared to compromise. 'Win-win' doesn't mean both the buyer and the seller will get everything they want. It means both sides will win some and give some. Rather than approaching negotiations from an adversarial winner-take-all perspective, focus on your top priorities and don't let your emotions overrule your better judgment. If you are close to an agreement, meet in the middle. Splitting the difference is a time-honored and often successful negotiation strategy.

The most important advice to remember is to ask your real estate agent! Successful agents tend to be experienced negotiators. They have seen what works and what doesn't in a variety of real estate transactions and with a variety of personalities. Many times they have an established track-record of bringing buyers and sellers together. Consult with your agent about how to best arrive at a workable solution that best meets your objective.

Buying Investment Real Estate

Mary Monday (RE/MAX Peak Properties) — Sun, 06 Jul 2008 12:44:52 -0700

While there is much talk about how the real estate market is in disarray, the timing for investors may be just right. As the stock market continues to go south, and with money market/CD investments paying very low interest, it may be time that you consider moving your money into real estate investments.

There are a number of issues to consider before buying investment properties. Are you interested in commercial, land, or residential property speculation? Land is generally a growth investment while residential and commercial rentals are considered growth and income. Each of these investment types has its own pitfalls and rewards. However if you plan accordingly you should see a decent return on your dollar. First consider the type of real estate that you would like to have and the impact ownership may have on your life. The old saying location, location, location is as true today as it has ever been.

After you have found a few properties that may suit your need you can then conduct a quick financial analysis to see if it is a worthy investment. First calculate the capitalization rate or CAP rate. The CAP rate is the rate of return or yield from a property that you expect as an investor. The rate is determined by dividing a property's net income by its sales price. You should also consider the rate of return on your down payment. Comparing these rates to your return from a bank, stocks or other investments will give you a good idea if you want to continue with the purchase of a particular property.

Real Estate investing is not for the faint of heart or the short term investor. It takes time for real estate values to appreciate. As with any investment you must consider the risks. If you purchase rental property be prepared to react to maintenance problems on short notice.

If the past is any indication of the future, real estate in Flagstaff and Northern Arizona should be a solid investment. Talk to your realtor and accountant before making a purchase. Your realtor will have a good feel for the market and your accountant can advise you on the tax implications of owning real property.

Taking Title to Real Estate in Arizona

Mary Monday (RE/MAX Peak Properties) — Fri, 13 Jun 2008 16:22:19 -0700

If you are in the market to purchase a home, a question that you should ask yourself is how you want to take title. When you find a property and sit down to write the contract your agent will ask you the same question. To help you prepare for the answer I have listed the most common ways that individuals take title in Arizona. There are other methods in our state that are designed for, trusts, corporations, and partnerships; however in the interest of simplicity I have not included them.

Community Property: Arizona is a community property state. There is a statutory presumption that all property acquired by a husband and wife is community property. Community property is a method of co-ownership for married persons only. Upon death of one of the spouses, the deceased spouses' interest will pass by either a will or intestate succession.
Community Property with The Right of Survivorship: Community property with the right of survivorship is a method of ownership by husband and wife only that vests title in the surviving spouse upon death of one of the spouses.
Joint Tenancy With The Rights of Survivorship: A method of ownership between two or more persons in which title transfers to the survivor(s) upon death of any one or more of the vested owners. Since ownership is automatically passed onto the survivor, acceptance must be made by all parties acknowledging the relinquishment of their right to will the property to heirs.
Tenancy in Common: A method of co-ownership where parties do not have survivorship rights and each owns a specific undivided interest in the entire title.
Sole and Separate: Real property owned by a spouse before marriage or any acquired marriage by gift, devise, descent, or specific intent. If a married person acquired title as sole and separate property, his/her spouse must execute a Disclaimer Deed.

While the above methods and definitions may seem bewildering, a careful review of the options and an assessment of your circumstances will enable you to make the right decision. Because we reside in a community property state, the way in which one takes title to property can have future legal and tax consequences. If you are unsure you should consult with a real estate or tax attorney, and/or an accountant.

Fair Housing and the Law

Mary Monday (RE/MAX Peak Properties) — Sun, 11 May 2008 11:27:26 -0700

This year marks 40 years since the Civil Rights Act of 1968 (Fair Housing Act) was enacted by Congress. The act prohibits discrimination in the sale, rental, and financing of dwellings, and in other housing-related transactions, based on race, color, national origin, religion, sex, familial status, and handicap.

Every couple of years we in the real estate business in Arizona take a number of industry related training courses designed to keep us current in our profession. In April the National Association of Realtors celebrated the 40 year anniversary of the Fair Housing Act with a training session entitled "At Home with Diversity". The objective of the class was to remind realtors of their duties as it relates to the sale and rental of real estate, and how provisions of the act must be followed.

A key point that those in attendance learned, is that although a real estate agent has a number of responsibilities concerning the Fair Housing Act when conducting a real estate transaction both the seller and buyer have responsibilities as well. We as Realtors® have a duty to counsel our clients about provisions of the act if we think there could be violations during the transaction. While I certainly don't expect that everyone read the entire Fair Housing Act I would encourage prospective buyers, sellers, landlords, and tenants to familiarize themselves with some key points of the law. It may save you some undue grief in the future.

I have never heard of a violation of the law by any Realtor®, or the public in Northern Arizona, and can only hope that remains the case. We must however be cognizant of the possibility that there could be people with whom we conduct business that may be ignorant of, or just don't care about the law. If you would like to read about The Fair Housing Act you can go to the US Department of Housing and Urban Development web site at http://www.hud.gov.

Pricing your Home to sell in today’s Real Estate Market

Mary Monday (RE/MAX Peak Properties) — Sat, 05 Apr 2008 09:36:20 -0700

Gone are the days when sellers were in the driver's seat of the real estate market. Today buyers are flexing their muscle, and most are not ashamed to make low offers. To counter an unrealistically low offer and defend your asking price, here are some things that you can do.

Price realistically: We all want to get as much money as we can from the sale of our home. However with unrealistic expectations your home will languish on the market for a long time. Ask your real estate agent for an updated comparative market analysis (CMA) at the end of each month. Carefully review the figures that show what has sold in your neighborhood during the past six months as well as what your current competition is. It is also a good idea to review pending sales figures to see how much action there is in your area.
Understand the market: Your agent is there to help you understand what is going on in the marketplace but they have no control of market conditions.
Be prepared to reduce your price: If you are not getting much action or interest in your home be prepared to lower the price. The CMA will give you an indication where you are with the competition. Some in our profession suggest that if you haven't received an offer after eight to ten showings you should consider a price adjustment.
Keep your house in tip top shape: As I have written in previous articles a house that is well maintained has a much better chance of selling than one that is cluttered, dirty, and has no curb appeal.
Creating value is the key: Your home should be priced so that buyers consider it to be within the top two or three values in that price range. If someone feels they can get a good product for a fair price; the chance of getting an offer increases dramatically. Ultimately the value of your home is decided by both you and the buyer. When you come to an agreement and close escrow that sales price is the true value of your home.
Finally be prepared for a longer than normal period for your house to sell: The average days on market for single family homes in our market were 127 days in February 2008 compared to 64 days in February 2006 when our market was still hot.

With our long winter over and spring here, more buyers are out looking and activity in the market is increasing. With the right knowledge, preparation and good luck your home may be one of the sold statistics in someone else's CMA.

Real Estate Buyer Advisory

Mary Monday (RE/MAX Peak Properties) — Tue, 11 Mar 2008 11:37:29 -0700

Purchasing a home can be a bewildering experience for anyone and especially the uninformed. With all of the publicity concerning foreclosures the need for buyers to be well informed prior to signing a contract has never been greater than it is today.

Arizona realtors have long recognized the need to educate the public with regard to the purchase of real property in our state. As a result the Arizona Association of Realtors and the Arizona Department of Real Estate have provided a publication entitled "Buyer Advisory". Information contained in this advisory is designed to make the purchase of real property by a consumer as smooth as possible.

Some of the most common issues that a buyer may decide to investigate or verify concerning the purchase of a property are summarized in the document. The three main topics discussed in the publication are; the common documents a buyer should review, the physical conditions of the property that a buyer should investigate, and conditions affecting the surrounding area that the buyer should investigate.

Many real estate professionals request that a potential buyer acknowledge a copy of the advisory prior to negotiating a purchase contract. The information in the advisory is provided with the understanding that it is not intended as legal or other professional services or advice but a document whereby the consumer can refer when a question arises.

If you are contemplating the purchase of Arizona real estate I suggest that you review the publication closely. You can download a complete copy of the Buyer Advisory at www.marymonday.com/docs/buy_advis.pdf. The Advisory provides valuable information and resources to help you become a more informed buyer.

Homeowners Associations; what you should know before you buy

Mary Monday (RE/MAX Peak Properties) — Mon, 03 Mar 2008 14:12:40 -0800

As a result of the slowdown in the housing market and the mortgage problems facing many home owners, I feel that the timing is right to educate buyers about what to look for when purchasing a home in a subdivision that has an active Home Owners Association (HOA). Although the majority of associations are financially sound, problems could arise if the developer of the subdivision who started the HOA closes shop before turning the HOA over to its residents. Most associations have been around for some time so it is doubtful that they will run into financial problems.

If you are preparing to purchase a home in an area with a homeowners association it is imperative that you find out the financial status of the association before you finalize a contract. To do this your real estate agent will include with your purchase contract a form entitled H.O.A. Condominium/Planned Community Addendum. The form which is approved by the Arizona Association of Realtors® provides a check list of information that you as a buyer need to obtain from both the seller of the property as well as the HOA prior to close of escrow.

As a buyer you should review the information closely. You have to know how much your dues are, and if they are paid monthly or annually. Who manages the association? Most associations are professionally managed by a company that is hired by the association's board of directors. Are past dues owed by the seller and if so who is going to pay them? If you are buying a distressed property (one that may be or is going into foreclosure) it is quite likely that dues are not paid and the HOA may have a lien against the property that must be paid prior to close of escrow. In most cases there is a transfer fee that must be paid, and is generally split evenly between both parties.

By law the association's management is required to provide you with details of the association itself. This includes the bylaws and rules of the association and a copy of the declaration of Covenants, Conditions and Restrictions (CC&Rs). Also a dated statement which includes information about the financial health of the association, information about management of the association and information about any pending litigation with respect to the home you are contemplating buying or the association itself must be provided.

I have posted a sample copy of the H.O.A. Condominium/Planned Community Addendum on my web site at http://www.marymonday.com/docs/hoa.pdf. If you are in the market for a home or condominium with a homeowners association I urge you to review it carefully. When you are ready to close escrow you will have peace of mind knowing that your HOA has its finances in order and is looking out for your best interest.

Internet Data Exchange and Broker Reciprocity

Mary Monday (RE/MAX Peak Properties) — Wed, 10 Oct 2007 17:03:19 -0700

All professions have terms that are specific to their line of work. The real estate business is no exception and our industry is peppered with acronyms of all sorts. Although Internet Data Exchange (IDX) and Broker Reciprocity (pronounced res-uh-pros-i-tee) are not terms used in everyone's daily vocabulary it is valuable that you understand the concept if you have a home for sale or are searching for real estate online.

By definition it is program where brokers grant each other permission to display their listings on each others' web sites. Brokers who participate in the program can display all active listings of all participating members of the program. If a broker chooses not to participate, no other broker will be permitted to display that brokers listings. No broker that I am aware of, who is a member of the Northern Arizona Multiple Listing Service (MLS) has elected to opt out of the program although they do have the option.

What does this mean to you as a consumer in Northern Arizona? If your home is listed with a broker who is a member of our MLS, the opportunity for it to be seen on many web sites other than your brokers is greatly enhanced. Many agents and firms here in Northern Arizona utilize IDX to expand the number of properties that can be viewed on their web sites. If you are a buyer the chances of finding a home that meets your needs are greatly increased if you are searching for real estate on a site that includes IDX.

Most of us know that the internet is the tool of choice when buyers begin their search for a home. By some accounts 85% of prospective buyers begin their search for a home online. Armed with this knowledge it is no wonder that IDX plays a huge role in online marketing.

“As Is” and what that means in a real estate transaction

Mary Monday (RE/MAX Peak Properties) — Fri, 08 Jun 2007 15:29:38 -0700

Occasionally someone acquires real estate in which they have limited knowledge of the property. This usually happens through inheritance or when a house is obtained as the result of a gift. An individual who owns this type of property usually knows very little about any issues relating to the structure. With no first hand knowledge of the property they are not in a position to disclose material defects when they decide to sell.

When this occurs, a property may be offered for sale "As Is". This means that the seller makes no warranty to the buyer either expressed or implied as to the condition of the premises, the zoning of the premises, or the premises fitness for any particular use or purpose. However "As Is" does not relieve the seller of the legal obligation to disclose all known material latent defects to a buyer.

An "As Is Addendum" to a purchase contract is used by realtors when they are negotiating an "As Is" sale. You can view a sample of the addendum at http://www.marymonday.com/docs/seller_asis.pdf.

A common term used in the real estate business is Caveat Emptor; it is a Latin phrase meaning "Let the Buyer Beware". Under this concept buyers make purchases at their own risk.

The value of curb appeal in a buyers market

Mary Monday (RE/MAX Peak Properties) — Sun, 03 Jun 2007 19:49:33 -0700

Curb appeal is a common term used in real estate marketing. It is defined as "everything prospective buyers can see from the street that might make them want to take a closer look at a house for sale". In the current real estate market here in Northern Arizona sellers need every competitive edge that they can find. If you have your home for sale or are contemplating putting it on the market take stock of how it looks both inside and out. When potential buyers come knocking; how your house looks in comparison to the one down the street can make the difference between an offer to buy or a "no thank you".

Neatness sells. New paint, an immaculate yard, picture-perfect shrubbery, a newly sealed driveway, potted plants at the front door - put them all together, and drive-by shoppers will probably want to see the rest of the house.

For both the inside and outside of your house, if you're going to repaint, choose neutral colors, and keep clutter and personal knick-knacks, photos, etc. to a minimum. Remember, when a family looks at a house, they're trying to paint a picture of what it would be like as their home. You want to give them as clean a canvas as possible.

The above is only a short list of potential things that you can do to attract buyers. There are numerous TV shows, publications and web sites that give advice for improving your homes appearance. Of course professional staging is always an option. There are several individuals in Flagstaff who provide this service.

Assuming that your house is priced competitively and that it has good curb appeal there should be no reason that buyers would not want to come for a look.