Vol. 5, No. 10, October 2008
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Real Estate 101
Interview With Todd Gordon, Prudential Fox and Roach Realty, Margate
Consumers need to understand that all real estate is “local,” which means each area of the country has a unique housing market. If property owners want to sell, they shouldn’t wait. Because we’ve seen average days on the market increase, market and price your home based on how fast you want to sell.
We’ve heard about buyer’s markets and seller’s markets. What about the investor's market? Is it still possible to make money as a real estate speculator today?
It’s still possible for speculators to make money if they purchase a property under market value. Then their investment will pay off in the long term.
On TV, open houses result in more offers if homeowners use the services of a “stager” to make the house look its best. Is this really a good investment?
Yes, staging can separate your home from the competition and make it stand out to sell faster and for more money.
Is there such a thing as a no-risk investment—for example, a seashore rental property—in today’s stagnant housing market? What are the pitfalls of renting?
A rental property is not a no-risk investment, though owners can work with realtors to make their rental properties low-risk. Unfortunately, rentals can be a pain when tenants lose their jobs, relocate, damage a property or need to be evicted.
What are the benefits and risks of selling a home on a lease-purchase basis?
Lease-purchases often benefit tenants since they can live in the property and then decide if they want to purchase it. But owners may lose out on other opportunities to sell the home by being in a lease-purchase.
Todd Gordon is a member of the Hartman Home Team, Prudential Fox and Roach Realty, 9218 Ventnor Avenue, Margate. He can be reached at 609-822-4200 or tod.acrealtor@gmail.com
The Right Time To Buy?
Many prospective homebuyers wonder if now is the time to purchase a new home. Some people say prices are still going down, others insist the market has hit rock bottom and prices will soon come up. Without a crystal ball, you have to rely on the next best source: market information.
Today’s market is at the forefront of the nationwide foreclosure wave. This was caused by the home-flipping frenzy, which was in turn fueled by overly loose loan programs. Banks are now overloaded with home inventory, and they’re in a race with each other to sell out their homes. Even when sold at a deep discount, the banks can still recover portions of their losses.
This race has created a short window of opportunity for today’s homebuyers. Prices of resale homes have fallen beyond the threshold at which new homebuilders can compete with them. But these price reductions are temporary. The market up to mid-200K is moving fast. Listings in this range are already receiving multiple offers. There’s been a drastic decrease of MLS inventory and an increase in the number of open escrows.
This is due to two factors: prices in this category have fallen to the level where mortgage payments are comparable to rent payments and FHA loan programs that require only 3 percent, or even nothing down.
The average buyer today is not a flipper or investor, but a person in search of long-term residency—a true potential homeowner. My best advice to them is to ask the right questions of the right real estate professional.
For example:
1. How are the comparable sales in my target area in the past three months?
2. How many days did it take to sell those comparables? (This is especially important so you can be competitive against other buyers.)
3. At what price did they sell in my preference of square footage?
4. How many available homes are competing for my business in this area?
5. What loan is the best fit for me? (This question should be asked of the lender or mortgage broker. Almost all owners of the listed homes today will require a loan pre-approval at the time of the offer. Be prepared, so the seller can see you as a strong buyer.)
Knowing the right time to buy depends a lot on the homework you do. Educate yourself, and you’ll thank yourself later.
By Design
Want to make a good first impression at home? Start in the foyer. Spectacular foyers with grand stairways and chandeliers are giving way to more comfortable, welcoming spaces where family and friends can feel comfortable dropping off boots, hats, umbrellas, schoolbooks and the like. Even a two-story foyer can have a homey feel if you display framed family photos in stair-step progression up the walls, include an armoire for storage, and include personal artifacts (beloved antiques or other collectibles) to share your personality with visitors. Position plants or potted trees in the corners, and don’t forget a bench for seating.
