Tuesday, January 23, 2007

7 For '07 - 7 Selling tip's for selling a home in 2007

So the market has been in correction mode the second half of last year and I'm continually asked when the market will pick up. The market is self-correcting as is the high risk mortgage market. The market correction in Centre County will be more about a softening in price, longer days on market for sellers, and educated buyers having more power in negotiating than in the giant price swings into negative territory that other markets are experiencing at the moment.

1. Market timing - When should I put my house on the market?

There is no time like the present. The market is heading in the direction of increased activity and will build every month into June and July. If you can picture a bell curve with early July the zenith and January and December representing points at the bottom of the curve on either side of July, you have a visual. What this means to sellers is that to reach the maximum number of buyers they should have their home on the market by the end of April. Sellers must realize that there will be more competition at this time, so I counsel sellers to list just ahead of the peak season in hopes that your property will be "sale pending" just prior to the onslaught of properties coming into the market.

2. Pricing

This is always the most important factor when selling your home no matter what the market. Please remember this; the market establishes the price of your home. The economics of home buying/selling mirror that of the commodities market in that sellers come to market with pricing based on availabilty and demand for their product and buyers purchase offers are based on the same knowledge plus the intrinsic value they place on the home

3. Home Inspection

Bite the bullet and pay for a home inspection prior to listing your home. In a competitive market it may come down to the minor details and the easy negotiations to get a home sold. If the buyer has the inspection in hand when considering an offer, it could save valuable time in the negotiation process and eliminate needless delays after a purchase offer is accepted.

4. Offer a Home warranty

When a buyer has narrowed the selection to one or two homes it may be something small like providing a one year home warranty to push the buyer to write on offer on your home and not the one down the street.

5. Prepaids

Be willing to offer buyers assistance with closing costs, inpsections, and interest rate buydowns. Maybe you will prepay the first years real estate taxes and insurance. Don't be afraid to tell them in the marketing material that you are offering items that your competition may not. Remember, you are competing with a limited number of savvy buyers that are aware of market conditions.

6. Negotiate
Sellers that have a serious interest in actually selling their home must be willing to engage buyers when they present an offer. I have been on both sides of the negotiation process when a seller reacts with disdain when presented with an offer that they consider to be insulting. If you simply bury your emotion and engage the potential buyers in a negotiation process, you may be surprised with the ultimate result. If you react like a teenager and refuse to respond, it will be the sellers loss. Remeber, almost 80% of the first offers are the best offers so at least take the time to counter-offer no matter how upset you may be with the initial offer. This is a business transaction. Remove the emotion and treat it as such.

7. Stay another year
If there is no urgent need to sell you may want to stay another year as the market bottoms out and completes the correction. What are your motives for moving? Do you want to trade up to a larger home? Are you empty nesters? You may find a more friendly market next year than you do at the moment. If selling this season is a luxury more than a necessity, you may want to re-think your strategy.
The trick is to get a great realtor, price the property well, and eliminate in advance as many potential problems as you can without spending a fortune.
For help in selling your home feel free to give me a call directly at 280-0054.

Wednesday, January 17, 2007


1. Prices have exploded so we should wait until they come down next year to buy.

Fact: Prices for closed sales rose 5.0% in 2006. They rose 3.0% in 2005.
Prices have appreciated in Centre County but not at the rate of certain "hot" markets across
the country. Our market over the past 30 years has averaged about 1% appreciation per
year. If you wait until next year hoping prices will fall you will be disappointed. Prices may
level off or drop a bit this year and next but any savings you may realize in waiting will be
offset by the increasing cost of mortgage money as rates are certain to be higher in 2008.
The important point to remember is that higher rates next year will negate any savings realized by price fallback.

Fact: The differences in a 30 year 200K mortgage comparing the current rate of 6% versus a potential rate in 2008 of 7.75% is $234 a month and $84,139 over the life of the loan. (P&I only). Will you save 84k on a $200k home by waiting until next year? NOT!

2. The market in Centre County real estate is slow so we can get a great deal from a seller.

Fact: Days on market or the average time it takes to sell a home was up 18.4% in 2006.

It did take longer to sell homes in 2006 but the market hardly slammed into a brick wall.
The market in Centre County could be described today as it could years ago; nice and steady and not too heady. It will take longer to sell a home in 2007 but the homes will sell. You may get a great deal from a seller but you may simply pay a fair price for a home that meets all of your search criteria and you can't live without.

3. I should contact the listing agent

Fact: Seller agency law in PA. states that the listing agent owes the fiduciary responsibility to the seller to get them the best price and overall deal. That will be at the expense and best interest of the BUYER.

Many buyers think they should call the listing agent of the property they want to preview. Buyers agents work with buyers to get them the best possible deal in the transaction. They owe the fiducuary responsibility to the buyer and not the seller. If you work with the listing agent on a transaction they will not have your best interests in mind as they are legally bound to the seller. Buyer agency was intended to negate the old adage; "let the buyer beware." When you call the listing agent you are by default renewing the "old adage."

Don't put yourself in that position by dealing with the listing agent.

4. As a buyer I need to pay a fee to my buyers agent before searching for homes.

Fact: Sellers brokers pay the fee for both sellers agents and buyers agents.

Only pay a fee to a buyers agent if they will entertain you by performing in a Mardi Gras costume while singing the Macarena and drinking green beer on St. Patricks Day morning. Otherwise, buyers agents work on your behalf and are paid at closing via funds provided through the selling broker.

5. Can we just go look at houses today?

Fact: The law requires agents in Pennsylvania to have signed buyer agency agreements in place prior to previewing homes.

The answer to the question is possibly. You are required to sign the PA Disclosure and buyers agency agreement. If you are serious about buying you should have your buyers agent get you prequlaified with a mortgage professional. Many sellers request 24 hours notice to view their homes. So, yes, you can go look at a few homes today if:

A. You have signed the required paperwork as requested by the state of Pennsylvania.
B. You have prequalified with a mortgage professional.
C. The sellers agree to a short notice showing.

If you need answers to other buyers myths or help buying or selling a home call me. I will give you the facts and the truth.

Monday, January 08, 2007

Fourth Quarter 2006 sales data for the Penns Valley School District.

4th Quarter 2006
Penns Valley Overview
16 Homes Sold Avg. DOM - 110
Avg. Price - $196,564

Low Price - $69,000 High Price - $336,350

259 E. Main - $69,000
144 E. Main - $142,500
165 Penn St. - $148,050
Spring Mills
689 L. Georges Valley - $78,000
105 Fieldstone Court - $217,000
173 Ayva Ln. - $295,000
132 Bilmar Ave. - $310,000
296 Harter Rd. - $366,350

134 W. Main - $92,000
277 White Deer Rd - $269,000
Centre Hall
123 Schaeffer Ave. - $146,000
128 Pennsylvania Ave. - $159,000
411 Pennsylvania Ave. - $162,000
100 Water St. - $150,000
113 Charles St. - $221,000
209 Whitetail Rd - $167,000

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Builders in trouble?

This morning I was doing some research on new home construction in Centre County when I stumbled across another article relating to the Florida building business. The only reason I mention this in my blog is that it supports my recent blog post relating to builders and developers carrying a substantially greater share of infrastructure costs in Florida. Read the post titled, "Who pays this tax anyway?" on December 30, 2006.

The builder states in the latest news release that 218 employees will be FIRED (layoff would be the politically correct term) between Feb. 16 and March 1, 2007. Merry Christmas to all - they were told on December 18, 2006. The builder "trimmed" 135 jobs on November 15, 2006. The company blamed the downturn in housing construction as new construction homes wallow on the market for months.

I wonder how much government regulation has impacted the sales of new construction housing? A billion dollars in new government regulations paid directly by builders must impact the costs (increasing them) to builders that are passed on to consumers in the form of higher prices. The higher prices slow demand because potential buyers may buy a resale at a lower price rather than buy the new higher priced home. Or trade-up buyers don't trade up and stay in their homes for additional years.

The losers? Employees of the builders and developers that lose jobs because builders and developers are not charity operations. I'm sure the employees sent packing have no idea their local elected officials have impacted their lives in this manner.

The good news is that government can take the "savings" they have realized from infrastructure taxes and use the money to keep the FIRED employees afloat while they search for new jobs in the state.

So, again I ask, "Who pays this tax anyway?" And now we know that empoyee's of builders "pay" this tax as well.

Thursday, January 04, 2007

What is "Green Building" anyway?

The first thing I think of when someone mentions "green building techniques" is the old bi-level house in our neighborhood that sported the beautiful green aluminum siding so popular in the early seventies (the 20th century). You probably remember the era when the cars wouldn't fit in the garages because they were the size of large boats and the coal delivery guy showed up several times in winter. I remember how grateful I was that we had oil heat when my friends had to haul coal ashes in the middle of winter.

"Green building techniques" have nothing to do with the color of the aluminum siding (or any other siding) on the old houses back in the day. According to the B.E.S.T. Green Building Primer green buildings:

Green Buildings are really resource efficient buildings and are very energy efficient, utilize construction materials wisely -- including recycled, renewable, and reused resources to the maximum extent practical -- are designed, constructed and commissioned to ensure they are healthy for their occupants, are typically more comfortable and easier to live with due to lower operating and owning costs, and are good for the planet. The overall environmental impact of new building and community development and the choices made when we either reuse or demolish existing structures is very important.

Green Building Construction Techniques:

1. Create minimum site impact

One wouldn't clear cut a lot prior to building a home. Selective cutting and site planning are considered. Water containment and run-off are minimized. Solar consideration is given when considering solar heat availability throughout the day. Shade availability is considered when thinking about additional cooling in warmer months.

2. Use renewable, recycled, or reused building materials.

Construction materials including insulation, framing, sheathing, and some roofing material are manufactured using recycled, renewable, and reused materials in concentrations ranging from 25% to nearly 100% in their overall content of recycled materials*

3. Maximize energy efficiency

Insulation is used in every available space. There are new renewable insulation sources builders can apply including a soy based foam insulation product that fills all cracks and crevices as it expands during the application process. An agent is added to deter rodents and other critters from "lunching" on the insulation. Caulk is applied to gaps and crevices in the framing of the home.

Energy efficient lighting, windows, furnaces, appliances, and boilers or heat pumps should be implemented in the design build.

Geo-thermal heat pumps should be used when they can be implemented within the overall design. Consideration should be given to the responsible use of the additional water available from the geo-thermal heat pump.

4. Use water efficiently

Low-flush toilets, well insulated hot water piping, low-flow shower heads and faucets, and dishwashers and clothes washers that have "water-miser" features are all important to lower home water use*

Water conservation should be carried outside the home into the landscape as well. Plant material and placement should be carefully planned based on the water needs of the exterior site plan and environment.

5. Indoor air quality

Certain air quality issues such as Radon gas and Mold have been addressed by the state of Pennsylvania. Other items to be addressed inlcude excesive moisture, mildew and dust mites.

6. Use local when possible

Green builders use local materials when available because they reduce transportation costs and environmental effects of transporting materials great distances. Many local building products are renewable or are second time use (recycled).

This is a brief overview of the green building process. Believe it or not there are no national standards that the industry has developed and adhere too when considering green building. There are several organizations that are working toward national standards and certifications so it is a matter of time before the industry takes this important step.

For additional information please check the green building link.

*Material provided by http://www.energybuilder.com/greenbld.htm

Monday, January 01, 2007

Bayberry Candle Tradition on New Years Eve

Happy New Year and following is a poem that is used in conjunction with burning Bayberry Candles. Some burn the candles on Christmas Eve and others on New Years Eve. We burned our candles on New Years Eve.

This Bayberry candle comes from a friend. So on New Years Eve burn it down to the end. Because a Bayberry candle burned to its socket, brings good luck, good health and wealth to your pocket.