Pam's Blog

Reno Sparks Foreclosure Bus Tour

2008-03-22T12:38:52Z

Well, I am going to try it out. I have been working on the logistics for a while now and I think that it is time to see if Northern Nevada can support a foreclosure bus tour.

I am sure that there is a company somewhere that has figured out a simpler way, but my team and I have been looking through every listing in the MLS filtering out the bank owned properties, sorting them by area and price and visiting every one of them to figure out which ones are the better deals. I am looking for suggestions. . .

Do you think that people are more interested in the high end foreclosures or the low end?

I have always felt that it was edging on unethical to sell a first time buyer a foreclosure that needed a lot of work. It seems that a lot of first timers are trying to break into the market this way. Does anyone have any wise advice to share with them?

We are only giving people 5 minutes in each house. It is not much time, but enough, I think if they are taking notes and paying attention. We will have to try it out and see.

I would love any suggestions from agents who have tried this in their area.

Why So Emotionally Attached to a Short Sale?

2008-02-01T20:52:01Z

Boy, it seems that two out of three listing appointments I am scheduling are for homes that will be short sales. Not sellers that cashed out to buy motor homes or Hawaiian vacations, either, homeowners that have legitimately lost their pants in a home in the past three years.

I am having a difficult time helping owners understand the level of emotional commitment involved if they don't have the money in the bank to pay the deficiency. Some insist on continuing to make payments to the bank. Has anyone had luck convincing a bank that is receiving a payment on time every month to accept a $100k+ loss on a loan? I could really use some advice, if you have.

Also, sellers seem reticent to price aggressively--even though they will not be negotiating the sales price, making any money or bringing any money to the table. With the current abundance of properties on the market, the short sales have to be a better deal than the other homes out there or agents simply wont waste their time. I can't understand a decision making paradigm that involves ruining your credit through foreclosure to prevent the embarrassment of pricing below what your neighbors believe values should be.

I know that people are hurting. These are tough times for people who are forced to sell. Has anyone read anything that helps EMOTIONALLY coach sellers through the process and helps them understand credit, tax and general implications of a short sale or foreclosure in layman's terms?

Thanks for reading.

What I tell sellers when they are considering taking their home off the market until spring.

2007-12-13T16:37:33Z

Should I take my home off the market until the spring?

Why? This question always baffles me.

First and foremost, the market doesn't drop off that significantly in the winter months. You will have less showings and less traffic, but a comparable number of qualified buyers which means less tire kickers, less cleaning, less landscape maintenance, and less cold beer when your friends move you in the cold! Additionally, uneducated sellers will take their homes off the market which means that for the buyers out there, inventory has reduced and the vacant homes and foreclosures that have been sitting on the market for an extended period of time look even worse with dead lawns and no heat. Your home could be a palace in the winter!

Some sellers are under the mistaken impression that our market will have recovered in the spring. While we are all hoping for a successful spring and summer in real estate next year, the data shows that we might be on the downhill roller coaster for a little longer than that. If your home is losing value each month and you elect to take it off the market for a period of time, be prepared for a significant price reduction to make up for the fall in prices over the winter months-remember, your home won't sell for more than it appraises for and it will only appraise for what the most similar nearby homes have recently sold for.

It is not all a winter wonderland, however, there are some things that you should know. If your home's most salable feature is either the yard or the view, you might consider taking your home off the market until the spring. Your home's sales price will not reflect these features if a buyer can't see them. Also, there are a lot more holidays in the winter months so your escrow should be longer than the standard 30 days. On a final note, if you tend to decorate for each event in a manner befitting a sitcom character, tone it down. Buyers of many different religious and cultural backgrounds will be shopping for a new home this winter. It would be a shame to miss out on the perfect contract and thousands of dollars because of a seasonal decoration.

First Time Buyer Agent Angst

2007-12-09T13:23:47Z

Boy, what a few weeks I have had with my buyers! Don’t get me wrong, the buyers are great. Young families struggling to scratch out their first piece of the American dream who have worked for years to repair and build credit and save for closing costs—and they are getting the tar beaten out of them like it was 2002. All of the sellers that I talk to have the same complaint—there aren’t any buyers out there. All of the buyers that I run into have this one—the homes that were reasonably priced are sold, the ones that are left are overpriced or the sellers are being unreasonable. It’s probably a little of both. There are some great programs out there for first time buyers—the state of Nevada actually has some down payment assistance and loan programs with locked low loan rates but you have to make less than about $70,000. per household in order to qualify. If this is your income, the loan ratios will only approve you for a purchase price of about $240,000. All of the homes that are this price or lower and are at all decent have sold like the proverbial hotcakes. What is left is the junk that is in that range and the homes that are just a little out of reach. Buyers and their agents have been desperately trying to negotiate the homes that are out of their reach down into it. This is the same phenomenon that occurred in 2003-2005 when creative 100% financing ARM loans made the price range of $290,000-$310,000 extinct. The funny thing is, these are the same buyers. The fallout in the secondary loan market has eliminated the creative loans that pumped up the price range of the first time buyers. The market is flooded with buyers, they are just all approved for the same price range and it has already been pretty well picked over. Truth is, I have had much better luck negotiating 60k or more off the list price of new home construction with a closing cost concession than I have had in negotiating 5k off of a miserable resale in a less desirable neighborhood. There is certainly more power and a higher customer satisfaction rating in a home where your buyers can pick every detail from the exterior color to the bathroom floor—especially since most of the resale homes they have been trying to negotiate are either dated flophouses or foreclosed maintenance nightmares. As an agent who works with lots of young buyers, I am getting tired of traipsing through the same dead listings that are stained, tattered and ripped apart only to find that the bank or investor that owns them believes that there is an oil well or gold mine in the back yard or worse yet, the family that owns them WON’T or CAN’T accept a reasonable offer. It is an age old struggle, I am sure, but I am a relative newcomer and the struggle doesn’t make any sense to me. If economists are predicting that our market will continue to hemmorage value for another 2% and 18 months, why would an owner reject an offer 2% below list price (which is typically 5% above actual value) and agree to make payments for the next 18 months while the value continues to drop? And, why are agents agreeing to market and promote these unreasonable listings—yank the dead weight, especially if the owner is unwilling to compromise! As for me, I am just blacklisting the unreasonable properties. I won’t waste my or my staff’s time showing or negotiating listings that I can’t actually sell.