Hello Everyone,
When it comes to flipping houses Armando from the A&E channel has it down. I am good at what I do, but lets face it he has over 4 million people who watch him maybe oneday I will be on TV.
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launched a new site called Armando Montelongo.com.
This site is catered to one market,
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opportunities, Day traders, you name it and the site caters
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To your success,
Sean
Posted by the Asbury Park Press on 08/26/07
If you are selling property now in a market bedeviled by huge inventories of homes and a credit crunch, you could do better if you dumped your real-estate agent.
With a wide range of flat-fee and Internet-based services, you may fare well on your own, yet it's still important to know your options.
For years, homeowners relied upon licensed real-estate agents or brokers, who charged from 5 percent to 7 percent commissions. These middlemen included your home in the industry's Multiple Listing Service and did marketing, advertising and negotiating.
What if you listed and sold the property yourself and avoided the commission?National Real Estate Listings without the Commissions!
According to a recent study, people who used a "for sale by owner" Web site, also known as FSBO, got at least as much for their homes as those who went through a conventional broker.
In many cases, considering the Web site only charged a flat fee, the vendors obtained a higher net selling price than through broker contracts.
Researchers Aviv Nevo and Igal Hendel of Northwestern University, and Francois Ortalo-Magne of University of Wisconsin-Madison examined sales conducted from 1998 to December 2004 through the Web site www.FSBOMadison.com.
Shorter time
Although the study only looked at one Internet service, it noted that listing on the MLS — instead of the Web site — "does shorten the time it takes to sell a house."
The study is welcome news for sellers who want to lower their commission costs and boost net sales prices.
Homeowners could use some help when dealing with the real-estate industry these days. As the revolution in do-it-yourself home selling takes on new forms, it isn't having a significant impact in lowering brokerage expenses.
While housing prices have risen over the past five years, when adjusted for inflation, commissions haven't dropped, even with new services and increased efficiencies in real-estate transactions.
"From 1998 to 2005, U.S. housing prices climbed 37 percent in real terms, and, although national average commission rates appear to have fallen from 5.5 percent to 5 percent, average brokerage fees per transaction rose 26 percent in real terms during the same period," according to a U.S. Federal Trade Commission report published in April.
Industry defenses
The mainstream real-estate brokerage industry has fought discounting in a number of ways.
In 10 states, the industry has succeeded in having "anti- rebate" laws enacted that forbid brokers from discounting commissions, according to the FTC.
Agents typically split their fees with cooperating brokers. In anti-rebate states, no commission discount would be allowed, a practice that clearly hurts home sellers.
Another seemingly anti-consumer tactic is a "minimum-service law" in seven states that requires real-estate brokers to provide specific services.
Local real-estate groups were also accused of restricting flat-fee brokers' access to multiple listing services, which has resulted in several suits against industry organizations by the FTC during the past year.
Right service
Echoing the findings of the trade commission, the Consumer Federation of America, a Washington-based public-action group, found in its own report last year that "the desire of traditional brokers to "double dip' — where one broker collects all of the commission — lies behind all of their anti- competitive actions."
Is greed good when you are desperate to sell a property? Or are you better off avoiding a full-service broker altogether? The answer depends on how adept you are at selling your own property.
If you need full service and your broker can deliver a sale based on his referral network, then it may be worth the commission. If not, you have some options.
"Limited Service" or "Flat-Fee" brokers may charge you as much as $595 for listing or advertising your home. But that's all they are obligated to do.
You can often find a cheaper "MLS-only" package that will only add your home in the industry's listing service. You are responsible for advertising, showing and negotiating.
"Flat-Fee Plus" packages often include negotiating and other assistance for an additional $1,500 or more. You can also upgrade to full service at discounted rates with some online brokers.
Legitimate buyer
Keep in mind that if you take the do-it-yourself route, while your net sales proceeds will be higher, you will have to do much more work and it may take longer to close a sale.
The bottom line is finding a legitimate buyer who is willing to pay the highest possible price. If you have a buyer already lined up or live in a high-demand neighborhood, you certainly don't need a full-service broker.
Should you not feel comfortable marketing your home, brokers with advertising and referral resources may be a better bet. They are also helpful in finding financing.
Although commissions are still too high in an era in which securities and mutual-fund commissions have dropped to practically nothing, there's still the guiding hand of economic self interest that influences who is likely to close a deal.
As the FTC study notes, "brokers have certain incentives to "steer' consumers toward those homes that offer the highest cooperating broker commission and away from homes listed by brokers known to charge discounted commission rates."
ON THE WEB: Visit our Web site, www.app.com, and click on this story for a link to a bonus William Pesek column.
John F. Wasik, author of "The Merchant of Power," is a columnist for Bloomberg News.
By David Leonhardt, Vikas Bajaj
New York Times
Published on: 08/26/07
The median price of American homes is expected to fall this year for the first time since federal housing agencies began keeping statistics in 1950.Thinking of Selling Your Home? Let REALTORS® Compete For Your Business!
Economists say the decline, which could be foreshadowed in a widely followed government price index to be released this week, will probably be modest —- from 1 percent to 2 percent —- but could continue in 2008 and 2009. Rather than being limited to the once-booming Northeast and California, price declines are also occurring in cities such as Chicago, Minneapolis and Houston, where the increases of the last decade were modest by comparison.
Home prices in Atlanta —- which rose far less than in some other cities during the first half of this decade —- are essentially flat.
The predicted national reversal is particularly striking because many government officials and housing-industry executives had said that a nationwide decline would never happen, even though prices had fallen in some coastal areas as recently as the early 1990s.
While the housing slump has already rattled financial markets, it so far has had only a modest effect on consumer spending and economic growth. But forecasters believe its impact will lead to a slowdown over the next year or two.
"For most people, this is not a disaster," said Nigel Gault, an economist with Global Insight, a research firm in Waltham, Mass. "But it's enough to cause them to pull back."
In recent years, many families used their homes as a kind of piggy bank, borrowing against their equity and increasing their spending more rapidly than their income was rising. A recent research paper co-written by the vice chairman of the Federal Reserve said that the rise in home prices was the primary reason that consumer borrowing had soared since 2001.
Now, however, that financial cushion is disappearing for many families. On an inflation-adjusted basis, the national median price —- the level at which half of all homes are more expensive and half are less —- is not likely to return to its 2007 peak for more than a decade, according to Moody's Economy.com, a research firm.
Unless the real estate downturn is much worse than economists are expecting, the declines will not come close to erasing the increases of the last decade. And for many families who do not plan to move, the year-to-year value of their house matters little.
It does, however, contradict the widely held notion that there is no such thing as a nationwide housing slump. A 2004 report jointly written by the top economists at five organizations —- the industry groups for real estate agents, homebuilders and community bankers, as well as Fannie Mae and Freddie Mac, the large government-sponsored backers of home mortgages —- was typical. It said that "there is little possibility of a widespread national decline since there is no national housing market."
In 2005, Ben S. Bernanke, then an adviser to President Bush and now the Fed chairman, said "strong fundamentals" were the main force behind the rise in prices. "We've never had a decline in housing prices on a nationwide basis," he added.
But Global Insight, the research firm, estimates that the home-price index to be released Thursday by the Office of Federal Housing Enterprise Oversight, a regulatory agency, will show a decline of about 1 percent between the first and second quarter of this year. Other forecasters predict that the index will rise slightly in the second quarter before falling later this year.
In all, Global Insight expects a decline of 4 percent, or roughly 10 percent in inflation-adjusted terms, between the peak earlier this year and the projected low point in 2009. In California, prices are expected to decline 16 percent —- or about 20 percent after taking inflation into account.
Since the index began in 1975, it has slipped from one quarter to the next on a few occasions, but it has never fallen over a full year.
Another index dating back to 1950, calculated by Freddie Mac, has also never shown an annual decline. Price data published by the National Association of Realtors, based on the prices of houses sold in a given year, have also never declined. According to the association, the median home price is now about $220,000.
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Planning on Buying or Selling? Find a Local Realtor
Tensions can run high in both the selling and buying of real estate. After all, there is a lot of money and emotion involved! There are also time pressures and numerous privacy issues to deal with. The sale and purchase of real estate can be a lengthy process involving numerous professionals from many fields.
The Real Estate Center at Texas A&M University asked 3,000 Texas home buyers to describe their recent purchase, about 400 replied. Their responses showed how stressful buying a home can be, for buyers and sellers. The Realtors and attorneys who try to keep all tensions at bay in order to complete the transaction also feel the burdens of stress!
"The process is grueling in the best of circumstances, and the severe buyers' market of recent times only increased the stress," says Dr. Jack C. Harris, Center research economist. "In conjunction with Lawyers Title Company, the Real Estate Center asked recent home buyers about their buying experience and what changes they think would make the process more buyer friendly."
The final question on the survey was, "If you could change anything about the home buying process, what would that be?" Almost a third answered the question, and most of them expressed dissatisfaction about some phase of the process.
Understandably some of the complaints were about circumstances beyond anyone's control. This included high prices, interest rates, the lack of listings in a specific area, where they wanted to buy, etc.
However, all of us Real Estate Professionals can learn much from some of the things that WE can, and should, do something about. Many of the folks surveyed felt that the Realtor did not perform up to their expectations. They were especially miffed when the Realtor assumed too much, that they understood what was going on, and didn't keep them well enough informed. In such a pressure cooker of financial and time constraints, the unfamiliar territory of buying and selling a property can be nerve wracking!
Many buyers and sellers need to be reassured and comforted. It is sometimes hard for the Realtor to know which of the dozens or even hundreds of people they are working with at one time need the most attention. Some of the Realtors' clients felt the agent did not take enough time with them. This was true even for some buyers who had a Buyer's Agent under contract to work on their behalf alone.
Realtors should alert and educate their clients, whether they be sellers or buyers, to the complexities and details of the real estate transaction. Some buyers feel that they are rushed through the looking, choosing, buying and settling process, and sometimes they are.
More and more buyers, especially the most savvy ones, are using Buyer's Agents. When there is a Buyer's Agency Agreement signed, most buyers expect far more service. Some feel that they don't always get it. In fact, according to the survey, 70% of those who had a Buyer's Agent wanted even more care, concern and service from their agent than they felt they had received.
The sellers, too, felt they had received too little service, care and attention in many cases, for the commission involved. Some seller's felt that the selling agent was not responsive enough to them, that calls were not returned promptly enough, or that not enough assurance, information, concern and communication was forthcoming from their agent.
Even though it is legally the seller who pays the Real Estate commission, it is really part of the overall transaction. Many buyers feel that they are the ones who are really paying that commission. They feel that the several thousand dollar commission is just tacked onto the selling price by the seller and thus it is they, the buyer, who is ultimately paying more for the property than they should! Buyers often feel that sellers inflate home prices to recover the cost of the commission.
Some purchasers want more contact with the sellers of the property; before, during and after they decide on the property and place a contract on it. Many wanted to develop a relationship with the seller of the property and have direct communication with them between the time of the contract and the settlement. Some felt that an agreement would have been more easily arrived at if the sellers and buyers could have hammered out details in person.
Other buyers had met with the sellers and considered that it had been the biggest error of the entire process. Most folks felt that the insulation of the Realtor(s), keeping the sellers and buyers apart and in communication only via written offers and changes to the contract was appropriate as it gave them the advantage of advice and discussion with their Realtor and time to think and discuss things before responding.
A huge part of the work and value that a Realtor or all the Realtors involved bring to the transaction is the mediation, conflict resolution, refereeing and monitoring of communications between buyer and seller. Often that is a huge and difficult task. Sometimes it is just too monumental to achieve satisfaction on the part of their client. Often it is those clients who are most difficult to work with that are the least satisfied with their Realtor. That is all part of the job we do. We do our best, from our own viewpoint, we try to satisfy the personality of our clients, and usually that is well appreciated!
After all, the natural flavor of a buying and selling transaction is adversarial. The Realtor is like a Gladiator in most cases; going to battle, in an honorable way and according to the rules, on behalf of their backer -- their client. There are many behind-the-scenes conflicts on behalf of clients that never are divulged and shouldn't be. It is the duty of the Realtor to put all parts of the transaction in the best, although truthful, light possible. A Realtor who transfers the natural adversarial animosities between buyer and seller does a disservice to his client no matter which side of the transaction is being represented.
Most buyers and sellers comments on the survey evidenced the importance and value of the agent in the transaction process. However, it is important that all of us Real Estate professionals (especially realtors) learn from our buyers and sellers, especially to responses they give about our profession when they are being surveyed on our service.
From the survey results of the Texas A&M University, Realtor(s )are well advised to learn that respondents praised especially helpful agents. It is reasonable to assume the majority who wrote nothing when asked to comment on any dissatisfaction, on this anonymous survey, were well satisfied with the service they received from their Realtor(s).
"We had a great experience," wrote one buyer. "The agent made all the difference. She kept us well informed almost daily. This was so important to us." While a majority of survey respondents had no comment regarding agents, 85% said they would use or recommend the agent again.
According to the survey report, complaints about the complexity of the home buying process fell into one of three categories: too complicated, too time-consuming or too costly. Many felt the process involved too much paperwork. Undoubtedly, they were reacting to the numerous, lengthy legal forms they had to sign before, during and after the contracting of the property as well as the seemingly almost unconfrontable stack of documents requiring a signature at closing.
It can take a terrific amount of time to find and buy a home. We often work with buyers for months seeking the right home. Some of them we've been working with, staying in touch with, and showing properties to -- for years. Those with some particular interests may find that a "possible" choice for them might only come on the market once in a great while! It is not an easy or comfortable situation for anyone involved, but the finding and buying or selling of a home or property can be made a MUCH more comfortable process with open, full and honest communication between the agent and the client at all times.
Many of our sellers would like us to find a buyer in a week or less for their property. Interestingly enough, it is often the property that is most difficult to find a buyer for that has the most impatient seller.
Even after a property is chosen by a buyer, there is a lot of time and work still needed from all those involved. The time, the continued negotiations, the inspections, reports, and evaluations needed, all the calls and appointments that need to be made on behalf of all parties involved almost always take far more time than anyone not directly involved can realize. This is usually frustrating to everyone. The sellers as well as the buyers often feel they are stuck in quicksand, unable to move or do anything without sinking further into the mire. At the same time -- that same quicksand of details required to complete the transaction seems at times to be filled with alligators ready to bite and take them down anyway. In some ways, that is all too true. And, it is the duty of all the Realtors involved to keep our clients and customers as comfortable as possible during these trying times of details and difficulties.
The Realtor usually spends a good deal of time trying to manage the lender(s) and get the money required to bring the deal to closing. Often this is the most difficult part of the transaction, even when the buyers and sellers are easy to work with. Usually, the first contact with a lender is all roses and sunshine. All too often however, the clouds and thorns of problems are soon evident. Realtors are often fully employed trying to get all the requirements fulfilled for the lender and the purchaser and when those are complete we work to make certain the promised funds are still available, approved and ready for closing, ON TIME.
At the closing, there is another 2% to 3% or, in some few cases, even more of the purchase price involved at closing for each the buyer and the seller. The long list of expensive items often seems too costly to both the buyer and the seller. Some folks find this irritating and feel it to be unfair. Some wonder why there are so many fees and services that find their way to the settlement table and may wonder if the fees and services were even necessary.
The myriad details involved with the finding, selecting, negotiating, contracting and transferring of ownership and funds at final settlement is time consuming, detailed, and often challenging.
People are accustomed to buying most things instantaneously and getting instant gratification for their decisions. Especially for those of us who use the Internet a lot. In a recent survey it was shown that most people who purchase via the Internet want the purchase delivered to them via overnight service. MOST buyers do not appreciate the legal complexities of taking title to real estate. They most often, simply do not understand why it should be so complicated to buy a piece of land or a home, nor do they understand the complexities of getting them approved for the best rate and terms in the mortgage obligation -- even if they have done it before.
The real estate industry has made great and consistent accomplishments in speeding up the entire buying process; from searching via the Web to getting mortgage approvals in sometimes an hour. Even title searches, lien searches, judgment searches and the typing of the dozens of pages of legal documentation has been streamlined with modern devices and techniques. However, there is another bundle of issues that slow the process while the aforementioned have sped it up. The litigious society we live in, the relatively recent and growing list of written disclosure requirements and legal contingencies have adversely affected the time and ease involved. It has limited the progress and speed of the individual parts of the transaction steps at nearly every point.
We, as Real Estate Professionals should, in fact we must, pay special attention and take special care in helping buyers and sellers understand what is going on at each step of the selling and purchasing process. We need to make it clear why the various expenses incurred at closing are ordinary and necessary. We need to alert our clients and customers to the potential consequences of each place where they can be financially and legally harmed or put at risk by cutting corners. We do our best!
Based on every available survey, it is evident that the Internet is growing and soon to be of utmost importance to buyers searching for a home. A review of 37 major search engines showed that Real Estate related searching and use was the third major use of the Internet, world wide. In America, it was second except for a temporary flurry of interest in searching for information on digital cameras which barely put it in third place here also.
The Internet is, however, not the only factor in the overall search. At price ranges of $300,000 and more; about 90% of the first contacts are to a Realtor with an attractive, informative, workable and fast acting Web site. As the price of the home descends, the percentage of buyers using the Web decreases. For homes under $100,000, only about 25% of our personal response is a result of our Web site presence and expertise.
Simultaneously, fewer Realtors instead of more, are finding the Web useful according to our recent survey. The reason is obvious to some of us; most users want sites to be far more informative, more private, and want the sites to have a lot more content. They want more pictures, better descriptions, related sales, crime reports, etc. Some of these things are not even available yet for our market area but the buyers still want them. People would like to rule out those homes they are not interested in before they even contact a Realtor in most cases -- especially for the more expensive properties.
Users want the sites to come up faster and to be more intuitive of their interests and needs. People are also reluctant to show what they don't know as it makes them feel vulnerable. Thus we try to have lots of data on our site so the sellers and buyers can educate themselves before they contact a Realtor.
Some clients seem to realize and appreciate that Realtors are also dependent on other professionals to make the home buying transaction go more safely, more legally proper and in all ways more smoothly. Buyers do expect the agent to keep them informed about progress and to effectively, quickly and professionally handle any obstacles to their goals and purposes in the transaction.
The entire process of selling and or buying a property, especially a home, can be nerve wracking and full of tension for everyone concerned. Some problems are unavoidable, some are unpredictable, some are created out of nothing by some party to the transaction. Many problems can be resolved or avoided if the sales agent provides information, reassurance and support to the buyer.
In the final analysis, it is up to you, the buyer or the seller to be the "squeaky wheel in need of oil" and call, write, e-mail and otherwise let your Realtor know immediately when you feel needy of more communication, care, solace or help. Our job is about 98% invisible to our customers and clients. Even when we tell everyone what we are doing, it is almost always hard for them to believe the time it takes for what seems, to them, a simple task. We usually have a few dozen customers and clients at any one time that we are trying to service as if they were the only person in our professional lives.
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Friday, August 24, 2007
Inman News
The rate of new single-family home sales dropped about 10.2 percent in July and the median sales price rose 0.59 percent compared to the same month last year, the U.S. Census Bureau and Department of Housing and Urban Development announced today.
Sales of new single-family houses in July 2007 reached a seasonally adjusted annual rate of about 870,000, compared with the July 2006 estimate of 969,000. The rate is calculated as a projection of the monthly sales total over a 12-month period, adjusted for seasonal fluctuations in sales activity.
The median sales price of new houses sold in July 2007 was $239,500, compared with a median price of $238,100 in July 2006. Meanwhile, the average price of new homes sold in July 2007 was $300,800, down 3.4 percent compared with the July 2006 average price of $311,300.
What's" Your Home Worth?
The seasonally adjusted estimate of new houses for sale at the end of July was 533,000, which represents a supply of 7.5 months at the current sales rate. A supply greater than six months is generally considered to indicate a buyer's market.
Statistics are estimated from sample surveys and are subject to sampling variability as well as nonsampling error including bias and variance from response, nonreporting and undercoverage, the agencies noted.
Changes in seasonally adjusted statistics can show irregular movement, and it can take five months to establish a trend for new houses sold. Preliminary new-home sales figures are subject to revision. On average, the preliminary seasonally adjusted estimate of total sales is revised about 3 percent, according to the report.
