Last year, my husband was given his grandfather’s financial journal from the 1930’s. At that time, his grandfather had a small farm near Brenham and owned a few cows, sheep, hogs, and chickens, grew cotton and tended to a vegetable garden. The journal was a heart breaking account of how difficult life was during our nation’s worst economic times. Work was hard, money was scarce and possessions were few. What is surprising though is that my mother-in-law has very fond memories of growing up during these times. But with life centered around church, family and friends, the most important building blocks of a happy childhood were intact.
As hard as life was for my husband’s grandparents, they still fared much better than many non-farming folks during that era. That was primarily because of their self-sufficient lifestyle. They may have been poor, but they always had food on the table. A self-sufficient lifestyle is a way of life that is still around today. In fact, I recently listed a property whose owners have embraced this concept. With a barn, chicken coops, multiple fruit trees, a small vineyard, smoke house and cold storage, this property has many of the elements needed for a self-sufficient lifestyle.
A self sufficient lifestyle can describe many different aspects. From planting a small garden to living off the electrical grid, the concept of self-sufficiency has many variations. It seems that more and more people these days are interested in having property that will allow them to pursue one or more elements of a self-sufficient lifestyle. Some are interested in water conservation techniques such as cisterns and drought tolerant landscaping. Some are interested in reducing their carbon footprint through power conservation equipment like solar panels and wind mills. Some are interested in producing their own food thru organic gardening or raising poultry and livestock. And some are interested in all of the above.
But before you purchase a home with the vision of gathering free range eggs in the backyard, you better do some homework. When shopping for a property that will allow various elements of self sufficient living, the first thing to check out is if the property has any deed restrictions against the desired activity. Of course if the property is unrestricted, most anything goes. But if it is restricted, a buyer should read the deed restrictions carefully to determine what is allowed.
Once you’ve determined that you are not prohibited from a certain activity, then check out the property’s physical characteristics. For example, if you’re interested in gardening, make sure you have sufficient sun exposure in the areas that are available for the garden. If you’re interested in solar panels, make sure the desired location of the panels has adequate sun exposure. If you’re interested in power conservation, make sure existing living spaces have good insulation, windows are double paned and appliances are energy star rated. If you’re interested in water conservation, steer away from properties with thirsty landscaping.
Whether you’re interested in saving money, enjoying the outdoors or establishing a hedge against uncertain economic times, a self-sufficient lifestyle can be a rewarding experience for individuals and their families. If you’re interested in making this type of lifestyle change, give me a call. I can help find a property that will work for you.
Sunday, July 4, 2010
Sunday, May 30, 2010
Timing the Sale of a Home
Late last year, I was contacted by a client who wanted to sell their home. Since they wished to synchronize the sale of their home with the end of the school year, they were wondering when the best time to put their home on the market was. They were rightly concerned about setting the optimum time to introduce their home onto the market as a quick sale would force them out of their home too early and a sluggish sale would disrupt their relocation plans. In many cases, the seller’s personal circumstances necessitates an immediate listing. But when a specific relocation time frame is known well in advance, certain factors should be considered when selecting the right time to list a home. Here are some of the factors that I look at when working with my clients:
Historical Days on Market (DOM) – We all know that historical data is not always an accurate predictor of future results. But it can help define some general expectations. Since January, 2007 the median time from a home’s initial listing date to its closing date in Montgomery County has been 71 days. But within this group of over 20,000 homes sold, DOM’s have ranged from 1 day to several years. The DOM can vary significantly according to market conditions, season, price point, and location. For example, the median DOM for Montgomery County in 2007 was 61 days, but due to deteriorating market conditions, the median DOM had increased by almost 50% to 90 days in 2009. Results in 2010 indicate a slight improvement over 2009, but not yet to 2007 levels. Seasonality also affects the length of time a home stays on the market. Historically, the largest number of closings occur in May through August and, as expected, many of the homes closed during these months have been on the market the least amount of time. Price point is another factor as more expensive homes typically take longer. Finally, location is an important factor. While the impact of location varies considerably among neighborhoods, homes sold in the southwestern part of the county generally have the shortest DOM’s.
Pricing of the Home – Perhaps the most important factor affecting the length of time on the market is the pricing of the home. Setting a realistic price cannot be stressed enough. If priced too low, a home will sell the quickest, but the seller could be leaving money on the table. If priced too high, a home sells the slowest and could even eventually sell for a lower amount than if originally priced more reasonably. Local market conditions, features of a property and condition of home should all be taken into consideration when pricing a home. Unlike a commodity where the fair market value is readily assessed, all homes are unique and should be carefully analyzed to maximize its value.
Listing Product – A home’s listing should be entered into MLS and a Realtor’s personal website. It should be comprised of accurate quantitative data along with a descriptive narrative of the virtues of the home. Accompanying pictures should be well framed and vivid. Print advertising and signage should be well placed and have a professional appearance.
Listing Process – An effective listing is a process, not an event. Once a listing is initiated, data continues to develop that might warrant a change in pricing, home presentation or marketing strategy. Feedback from showings, changes in competitive listings and general economic data can dictate a change in course. Realtors should continually monitor a listing’s pulse and keep the seller well informed at all times. A listing should never be viewed by the Realtor solely as a tool to attract buyers for their business. Its overriding focus should always be to attract a buyer for the listing.
When a specific closing date is targeted, work closely with your Realtor in timing the introduction of your home onto the market. There are many factors that determine how long it will take to sell a home, but having a full-time, local, experienced Realtor will maximize your chances of meeting your objectives.
I have been a local Realtor in Montgomery County since 2000 and am the owner of HomesPlus Real Estate Services. My office is located between Conroe and Montgomery at 19755 Hwy 105W. I can be reached at 936-537-1656 or emailed at Claudia@ClaudiaHohlt.com.
Historical Days on Market (DOM) – We all know that historical data is not always an accurate predictor of future results. But it can help define some general expectations. Since January, 2007 the median time from a home’s initial listing date to its closing date in Montgomery County has been 71 days. But within this group of over 20,000 homes sold, DOM’s have ranged from 1 day to several years. The DOM can vary significantly according to market conditions, season, price point, and location. For example, the median DOM for Montgomery County in 2007 was 61 days, but due to deteriorating market conditions, the median DOM had increased by almost 50% to 90 days in 2009. Results in 2010 indicate a slight improvement over 2009, but not yet to 2007 levels. Seasonality also affects the length of time a home stays on the market. Historically, the largest number of closings occur in May through August and, as expected, many of the homes closed during these months have been on the market the least amount of time. Price point is another factor as more expensive homes typically take longer. Finally, location is an important factor. While the impact of location varies considerably among neighborhoods, homes sold in the southwestern part of the county generally have the shortest DOM’s.
Pricing of the Home – Perhaps the most important factor affecting the length of time on the market is the pricing of the home. Setting a realistic price cannot be stressed enough. If priced too low, a home will sell the quickest, but the seller could be leaving money on the table. If priced too high, a home sells the slowest and could even eventually sell for a lower amount than if originally priced more reasonably. Local market conditions, features of a property and condition of home should all be taken into consideration when pricing a home. Unlike a commodity where the fair market value is readily assessed, all homes are unique and should be carefully analyzed to maximize its value.
Listing Product – A home’s listing should be entered into MLS and a Realtor’s personal website. It should be comprised of accurate quantitative data along with a descriptive narrative of the virtues of the home. Accompanying pictures should be well framed and vivid. Print advertising and signage should be well placed and have a professional appearance.
Listing Process – An effective listing is a process, not an event. Once a listing is initiated, data continues to develop that might warrant a change in pricing, home presentation or marketing strategy. Feedback from showings, changes in competitive listings and general economic data can dictate a change in course. Realtors should continually monitor a listing’s pulse and keep the seller well informed at all times. A listing should never be viewed by the Realtor solely as a tool to attract buyers for their business. Its overriding focus should always be to attract a buyer for the listing.
When a specific closing date is targeted, work closely with your Realtor in timing the introduction of your home onto the market. There are many factors that determine how long it will take to sell a home, but having a full-time, local, experienced Realtor will maximize your chances of meeting your objectives.
I have been a local Realtor in Montgomery County since 2000 and am the owner of HomesPlus Real Estate Services. My office is located between Conroe and Montgomery at 19755 Hwy 105W. I can be reached at 936-537-1656 or emailed at Claudia@ClaudiaHohlt.com.
Sunday, April 25, 2010
Exactly Who is Your Realtor Working For?
Recently I was contacted by someone from out of state who was in the process of relocating to Montgomery County. After spending some time understanding their objectives, I explained to them how real estate agency works in Texas and e-mailed them an “Information About Brokerage Services” pamphlet and a “Buyer’s Representation Agreement” for their review and signature. After a couple of days, they replied that they appreciated the information but would proceed with their home search without formal representation. So we amicably parted ways. Such is the nature of being a Realtor.
Realtors are often called Real Estate Agents. As you probably know, an agent is someone who is representing someone else in a particular activity or event. There are all kinds of agents; insurance agents, talent agents, press agents and secret agents to name just a few. The one thing all agents have in common is that they are acting on behalf of someone else, i.e. the principal. This relationship creates a fiduciary responsibility on the realtor. In other words, the interests of the principal come before the interests of the realtor, or any other person.
So is your Realtor always your agent? Not necessarily. In Texas real estate law, there is a concept called sub-agency. That means, unless an agreement is in place between the realtor and potential buyer, an agent showing a home is, by default, a sub-agent of the listing agent. In other words, the Realtor helping you find a home could technically be working for the seller, even if they are not the listing agent.
So how do you get someone to work on your behalf when you are the buyer? That is very easy to do. You enter into an agreement, typically a Buyer’s Representation Agreement, with your Realtor. This agreement enables the Realtor to put your interests first, not the seller’s. If you do not want to obligate yourself long-term to a certain agent, the Buyer’s Representation Agreement can be set for any time period, for specific houses, or for a specific area.
I should note that the Buyer’s Representation Agreement protects the agent as well. There are few experienced agents who have not been taken advantage of by a buyer with a hidden agenda. It is not unusual to spend an inordinate amount of time and travel with an unrepresented buyer, only to find out that they intend Aunt Suzy from Amarillo to write the contract and collect the commission once the right home is found. Once a Realtor has spent some time as a volunteer chauffeur and tour guide, the mutual benefit of a Buyer’s Rep Agreements becomes apparent.
What if you approach a listing agent to show you a home that they have listed? Agents can work for both parties as an intermediary. With written consent by all parties involved, an agent can essentially be the listing agent and the buyer’s agent. The agent cannot disclose confidential information of either party and must treat all parties honestly and fairly.
For anyone looking for additional information, this is all spelled out in a publication of the Texas Real Estate Commission titled Information About Brokerage Services (IABS). The IABS pamphlet should be presented to both buyers and sellers as soon as a relationship exists to ensure that there is no confusion about who’s working for whom.
Realtors are often called Real Estate Agents. As you probably know, an agent is someone who is representing someone else in a particular activity or event. There are all kinds of agents; insurance agents, talent agents, press agents and secret agents to name just a few. The one thing all agents have in common is that they are acting on behalf of someone else, i.e. the principal. This relationship creates a fiduciary responsibility on the realtor. In other words, the interests of the principal come before the interests of the realtor, or any other person.
So is your Realtor always your agent? Not necessarily. In Texas real estate law, there is a concept called sub-agency. That means, unless an agreement is in place between the realtor and potential buyer, an agent showing a home is, by default, a sub-agent of the listing agent. In other words, the Realtor helping you find a home could technically be working for the seller, even if they are not the listing agent.
So how do you get someone to work on your behalf when you are the buyer? That is very easy to do. You enter into an agreement, typically a Buyer’s Representation Agreement, with your Realtor. This agreement enables the Realtor to put your interests first, not the seller’s. If you do not want to obligate yourself long-term to a certain agent, the Buyer’s Representation Agreement can be set for any time period, for specific houses, or for a specific area.
I should note that the Buyer’s Representation Agreement protects the agent as well. There are few experienced agents who have not been taken advantage of by a buyer with a hidden agenda. It is not unusual to spend an inordinate amount of time and travel with an unrepresented buyer, only to find out that they intend Aunt Suzy from Amarillo to write the contract and collect the commission once the right home is found. Once a Realtor has spent some time as a volunteer chauffeur and tour guide, the mutual benefit of a Buyer’s Rep Agreements becomes apparent.
What if you approach a listing agent to show you a home that they have listed? Agents can work for both parties as an intermediary. With written consent by all parties involved, an agent can essentially be the listing agent and the buyer’s agent. The agent cannot disclose confidential information of either party and must treat all parties honestly and fairly.
For anyone looking for additional information, this is all spelled out in a publication of the Texas Real Estate Commission titled Information About Brokerage Services (IABS). The IABS pamphlet should be presented to both buyers and sellers as soon as a relationship exists to ensure that there is no confusion about who’s working for whom.
Sunday, March 28, 2010
Challenges Surrounding Contingency Contracts
I was watching one of the Winter Olympics speed skating relay races on TV last month. I was quite impressed by the level of teamwork and coordination as the athletes passed the baton from one skater to the next. Earlier this year, I was involved in the real estate equivalent of a relay race, i.e. a home sale contingent on another sale that was contingent on still another sale.
One of the most common elements found in real estate sales contracts is the “Addendum for Sale of Other Property by Buyer”. Essentially, this makes a buyer’s purchase of a home contingent on the sale of their existing home. So, if the buyer’s home doesn’t close, he/she is not obligated to go forward on the purchase of the new home. For most buyers other than first-time home buyers, this provision is needed since they either don’t financially qualify to own two homes at the same time, or just don’t want the financial burden of owning two homes at the same time.
In my recent experience, my client had a sales contract with a buyer in place on their existing home and a contingent contract in place on a home they wished to purchase. The seller of that home had a contingent contract in place on another home owned by someone that was moving out of the country. Through much effort by three separate Realtors, all three homes were scheduled to close on the same day in a domino fashion. Moving vans were scheduled at each of the homes and everyone was excited about moving. Unfortunately, there was a last minute, unexpected glitch in the first one of these transactions, and four families, three Realtors, three title company closers and three loan officers were on pins and needles until late in the day when the glitch was finally resolved.
Because of the increased uncertainty involved in contracts contingent upon the sale of another home, they are not the most favored among home sellers. But sometimes, they are the best alternative available. When a seller is considering the acceptance of a contingent contract, it is important to ask the buyer’s agent about the likelihood of the buyer realizing a timely sale of their home. The best evidence of that would be if the buyer already had a contract in place on their existing home, but at a minimum, their home should be listed, actively marketed and appropriately priced.
After a contingent contract is executed, there are a few additional things that a home seller should do. First, the “Addendum for Sale of Other Property by Buyer” should be written in a manner that requires the buyer to remove their contingency within a few days if the seller wishes to accept another offer. So if a stronger offer comes in, the buyer has to remove their contingency or opt out of the contract. And to facilitate the receipt of a stronger offer, the status of the listing in MLS should indicate that the home can continue to be shown to other prospective buyers.
For homeowners facing a job transfer or wishing to trade up or down to a different home, a contingent offer is usually a necessity. Just be careful that you don’t skate in this relay race on thin ice. Count on the help of a seasoned real estate professional who can ease the stress and increase the odds of success.
If you are in need of a Realtor, please give me a call. I have been a Realtor in Montgomery County since 2000. I've earned a GRI designation, and have been certified by HAR as a Top Production Realtor® in 2007, 2008 and 2009. My office is located between Conroe and Montgomery at 19755 Hwy 105W. I can be reached at 936-537-1656 or emailed at Claudia@ClaudiaHohlt.com.
One of the most common elements found in real estate sales contracts is the “Addendum for Sale of Other Property by Buyer”. Essentially, this makes a buyer’s purchase of a home contingent on the sale of their existing home. So, if the buyer’s home doesn’t close, he/she is not obligated to go forward on the purchase of the new home. For most buyers other than first-time home buyers, this provision is needed since they either don’t financially qualify to own two homes at the same time, or just don’t want the financial burden of owning two homes at the same time.
In my recent experience, my client had a sales contract with a buyer in place on their existing home and a contingent contract in place on a home they wished to purchase. The seller of that home had a contingent contract in place on another home owned by someone that was moving out of the country. Through much effort by three separate Realtors, all three homes were scheduled to close on the same day in a domino fashion. Moving vans were scheduled at each of the homes and everyone was excited about moving. Unfortunately, there was a last minute, unexpected glitch in the first one of these transactions, and four families, three Realtors, three title company closers and three loan officers were on pins and needles until late in the day when the glitch was finally resolved.
Because of the increased uncertainty involved in contracts contingent upon the sale of another home, they are not the most favored among home sellers. But sometimes, they are the best alternative available. When a seller is considering the acceptance of a contingent contract, it is important to ask the buyer’s agent about the likelihood of the buyer realizing a timely sale of their home. The best evidence of that would be if the buyer already had a contract in place on their existing home, but at a minimum, their home should be listed, actively marketed and appropriately priced.
After a contingent contract is executed, there are a few additional things that a home seller should do. First, the “Addendum for Sale of Other Property by Buyer” should be written in a manner that requires the buyer to remove their contingency within a few days if the seller wishes to accept another offer. So if a stronger offer comes in, the buyer has to remove their contingency or opt out of the contract. And to facilitate the receipt of a stronger offer, the status of the listing in MLS should indicate that the home can continue to be shown to other prospective buyers.
For homeowners facing a job transfer or wishing to trade up or down to a different home, a contingent offer is usually a necessity. Just be careful that you don’t skate in this relay race on thin ice. Count on the help of a seasoned real estate professional who can ease the stress and increase the odds of success.
If you are in need of a Realtor, please give me a call. I have been a Realtor in Montgomery County since 2000. I've earned a GRI designation, and have been certified by HAR as a Top Production Realtor® in 2007, 2008 and 2009. My office is located between Conroe and Montgomery at 19755 Hwy 105W. I can be reached at 936-537-1656 or emailed at Claudia@ClaudiaHohlt.com.
Sunday, February 21, 2010
Hard Facts on the Housing Market
I have a confession to make. I am married to somewhat of a data geek. He can spend hours slicing and dicing data. Yes, on the surface it may appear he has a boring hobby but, since he is licensed as both a Real Estate Broker and Certified Public Accountant, most of his number crunching exercises are interesting to me as they are very analytical and are related to local real estate market conditions.
Recently he downloaded statistical detail of the last 3 years of Montgomery County home sales from the local multiple listing service database. He then compared 2009 results to the prior two years to determine how market conditions have changed. There was no “Eureka!” moment since we all know we’re in a bearish housing market. But looking at the hard evidence really drove home how Montgomery County has been affected by our nation’s housing woes. Fortunately, our home prices have held up fairly well, but the demand for housing has fallen dramatically.
In looking at the data, the first thing that stood out was that the number of homes sold in Montgomery County took a drastic decline after 2007. 2008 declined by 21% and 2009 piled on another 6% decline. The two year slide translated to about 2,000 fewer homes sold in 2009 versus 2007. All areas of the county had similar experience. And although the average home price was fairly stable at a positive .5%, the increase was a result of the average home size increasing 2.6% combined with the price per square foot declining 2.1%. So, on an apples and apples basis, home prices have modestly declined. Furthermore, the average length of time on the market increased from 99 days in 2007 to 140 days in 2009. Interestingly, these results have taken place at almost every price point. The one exception is in higher end homes where prices have been discounted more deeply and homes have taken even longer to sell.
An area that really hits to the heart of our current economic recession is new construction. In isolating the data related solely to new home sales, we see that sales have fallen off even more dramatically. The Woodlands area, which consistently generates almost 60% of the new homes sales in Montgomery County, had 36% fewer sales in 2009 than in 2007. The Lake Conroe area, which generates about 20% of new home sales, had 48% fewer sales. For all of Montgomery County, new home sales dropped off an average of 38% which accounted for 632 fewer new homes sold in 2009 versus 2007. Based on the 2009 average new home price of $282,311, this drop off in new home sales translates to and estimated 178 million fewer dollars spent in Montgomery County on new homes compared to 2007. That represents a lot of lost construction jobs and lost sales of construction materials to our local economy. Those lost dollars ripple throughout our community and affect everyone.
But all is not gloom and doom. The most recent sales data supports a case for cautious optimism. New home sales as well as used home sales have increased in the last three month period when compared to the same three month period one year earlier. Although it is still well below the same three month period two years earlier, perhaps it means we’ve seen the bottom of the bear housing market and are beginning to climb our way back to better times.
While this may have been interesting info, what does it mean to potential home buyers and sellers? To home buyers, I would encourage you to consider the purchase of a home. With prices down, interest rates low, and tax credits still available, there may never be a better time to purchase a home than right now. If you’ve been thinking about selling your home, this may also be a good time. Inventory levels have come down and as buyers become more confident in the economy, demand for housing should increase. And to both potential buyers and sellers, I would recommend enlisting the help of an experienced, full-time, local realtor to help you with the process. Intimate knowledge of local market conditions has never been more important.
If you are interested in buying or selling a home, please give me a call. I have the knowledge and experience to maximize the value in your next real estate transaction.
Recently he downloaded statistical detail of the last 3 years of Montgomery County home sales from the local multiple listing service database. He then compared 2009 results to the prior two years to determine how market conditions have changed. There was no “Eureka!” moment since we all know we’re in a bearish housing market. But looking at the hard evidence really drove home how Montgomery County has been affected by our nation’s housing woes. Fortunately, our home prices have held up fairly well, but the demand for housing has fallen dramatically.
In looking at the data, the first thing that stood out was that the number of homes sold in Montgomery County took a drastic decline after 2007. 2008 declined by 21% and 2009 piled on another 6% decline. The two year slide translated to about 2,000 fewer homes sold in 2009 versus 2007. All areas of the county had similar experience. And although the average home price was fairly stable at a positive .5%, the increase was a result of the average home size increasing 2.6% combined with the price per square foot declining 2.1%. So, on an apples and apples basis, home prices have modestly declined. Furthermore, the average length of time on the market increased from 99 days in 2007 to 140 days in 2009. Interestingly, these results have taken place at almost every price point. The one exception is in higher end homes where prices have been discounted more deeply and homes have taken even longer to sell.
An area that really hits to the heart of our current economic recession is new construction. In isolating the data related solely to new home sales, we see that sales have fallen off even more dramatically. The Woodlands area, which consistently generates almost 60% of the new homes sales in Montgomery County, had 36% fewer sales in 2009 than in 2007. The Lake Conroe area, which generates about 20% of new home sales, had 48% fewer sales. For all of Montgomery County, new home sales dropped off an average of 38% which accounted for 632 fewer new homes sold in 2009 versus 2007. Based on the 2009 average new home price of $282,311, this drop off in new home sales translates to and estimated 178 million fewer dollars spent in Montgomery County on new homes compared to 2007. That represents a lot of lost construction jobs and lost sales of construction materials to our local economy. Those lost dollars ripple throughout our community and affect everyone.
But all is not gloom and doom. The most recent sales data supports a case for cautious optimism. New home sales as well as used home sales have increased in the last three month period when compared to the same three month period one year earlier. Although it is still well below the same three month period two years earlier, perhaps it means we’ve seen the bottom of the bear housing market and are beginning to climb our way back to better times.
While this may have been interesting info, what does it mean to potential home buyers and sellers? To home buyers, I would encourage you to consider the purchase of a home. With prices down, interest rates low, and tax credits still available, there may never be a better time to purchase a home than right now. If you’ve been thinking about selling your home, this may also be a good time. Inventory levels have come down and as buyers become more confident in the economy, demand for housing should increase. And to both potential buyers and sellers, I would recommend enlisting the help of an experienced, full-time, local realtor to help you with the process. Intimate knowledge of local market conditions has never been more important.
If you are interested in buying or selling a home, please give me a call. I have the knowledge and experience to maximize the value in your next real estate transaction.
Sunday, January 24, 2010
The State of the Foreclosure Market in Montgomery County
If I asked a group of people to say the first word that comes to mind when they hear the word “foreclosure”, I would probably get lots of different responses. Many would say “travesty”. Some would say “opportunity”. Any lenders present might say “backstop”. It all depends on one’s perspective.
2009 was another year in which too many homes went into foreclosure. While foreclosed homes are sold to the highest bidder on the courthouse steps, most of them have first liens (i.e. mortgages) with a remaining balance that is more than what buyers are willing to bid. Since the first lien holder is usually willing to bid their lien amount, they typically end up as the highest bidder. So the ownership of most homes in foreclosure ultimately transfer from the individual homeowners to their lender.
After the foreclosure is finalized, the majority of those properties are then listed and eventually sold by Realtors. Almost 1,100 of the 5,500 single family residences sold by Realtors in Montgomery County in 2009 were the result of a home foreclosure. That’s a disturbing 1 out of 5 homes. While this is a consistent ratio with the last several years, it is up from the 1 out of 7 homes in 2006, which is still too many.
If we dig into the 2009 numbers a little deeper, we find that Northeast Montgomery County, including Conroe, had the worst foreclosure experience. One out of three of the homes sold by Realtors in this area were foreclosures. Southeast Montgomery County had similar experience with about 1 out of 4 homes sold being foreclosures. Southwest County and Northwest County had the same experience with 1 out of 6 homes being foreclosures.
These rates are mirrored across the country and are at the core of our economic recession. The U.S. government has taken steps to help. The Home Affordable Modification Program was implemented to help homeowners facing foreclosure by reducing mortgage payments to qualified applicants. To reduce the number of future foreclosures, the House of Representatives has passed new legislation called the Consumer Financial Protection Agency. It now lies in the hands of the Senate, so its future is uncertain. If it is passed into law, it is hoped that the final bill will not only protect the consumer but will also not cripple the mortgage and housing industries.
While it is somewhat reassuring to know that our government is concerned about the high number of foreclosures, one can’t help but feel sad about the many good families who are facing, or have already gone through, a foreclosure. In the best of circumstances, it will take a long time to become eligible again to own a home. In the worst of circumstances, a family may never own their own home again.
Having said all that, without the foreclosure process, few of us would be able to get loans to purchase homes. Our housing industry depends on mortgage lenders and the mortgage industry depends on foreclosure laws to mitigate their risk and provide an effective backstop on possible losses. And finally, the buyers of foreclosures are an integral part of the foreclosure process. For without them, the lender would have no way to monetize their collateral.
Many people have found good opportunities in the purchase of foreclosed properties. Many foreclosures are attractively priced and are being bought up by first-time homebuyers, buyers trading up from existing homes, people moving to our area, and investors. As this article is being submitted, there are 200 foreclosures on the Montgomery County real estate market ranging in price from less than $50K to over $1 million. They exist in virtually every neighborhood and price range.
If you no longer are able to pay your mortgage, work with your lender, financial advisor and Realtor to understand your options. The stakes are high, so it is wise to be proactive rather than reactive. And if you are interested in exploring the foreclosure market, contact an experienced, local Realtor. There may be just the property out there that you have been waiting for.
You can contact me at 936-537-1656 or at Claudia@ClaudiaHohlt.com.
2009 was another year in which too many homes went into foreclosure. While foreclosed homes are sold to the highest bidder on the courthouse steps, most of them have first liens (i.e. mortgages) with a remaining balance that is more than what buyers are willing to bid. Since the first lien holder is usually willing to bid their lien amount, they typically end up as the highest bidder. So the ownership of most homes in foreclosure ultimately transfer from the individual homeowners to their lender.
After the foreclosure is finalized, the majority of those properties are then listed and eventually sold by Realtors. Almost 1,100 of the 5,500 single family residences sold by Realtors in Montgomery County in 2009 were the result of a home foreclosure. That’s a disturbing 1 out of 5 homes. While this is a consistent ratio with the last several years, it is up from the 1 out of 7 homes in 2006, which is still too many.
If we dig into the 2009 numbers a little deeper, we find that Northeast Montgomery County, including Conroe, had the worst foreclosure experience. One out of three of the homes sold by Realtors in this area were foreclosures. Southeast Montgomery County had similar experience with about 1 out of 4 homes sold being foreclosures. Southwest County and Northwest County had the same experience with 1 out of 6 homes being foreclosures.
These rates are mirrored across the country and are at the core of our economic recession. The U.S. government has taken steps to help. The Home Affordable Modification Program was implemented to help homeowners facing foreclosure by reducing mortgage payments to qualified applicants. To reduce the number of future foreclosures, the House of Representatives has passed new legislation called the Consumer Financial Protection Agency. It now lies in the hands of the Senate, so its future is uncertain. If it is passed into law, it is hoped that the final bill will not only protect the consumer but will also not cripple the mortgage and housing industries.
While it is somewhat reassuring to know that our government is concerned about the high number of foreclosures, one can’t help but feel sad about the many good families who are facing, or have already gone through, a foreclosure. In the best of circumstances, it will take a long time to become eligible again to own a home. In the worst of circumstances, a family may never own their own home again.
Having said all that, without the foreclosure process, few of us would be able to get loans to purchase homes. Our housing industry depends on mortgage lenders and the mortgage industry depends on foreclosure laws to mitigate their risk and provide an effective backstop on possible losses. And finally, the buyers of foreclosures are an integral part of the foreclosure process. For without them, the lender would have no way to monetize their collateral.
Many people have found good opportunities in the purchase of foreclosed properties. Many foreclosures are attractively priced and are being bought up by first-time homebuyers, buyers trading up from existing homes, people moving to our area, and investors. As this article is being submitted, there are 200 foreclosures on the Montgomery County real estate market ranging in price from less than $50K to over $1 million. They exist in virtually every neighborhood and price range.
If you no longer are able to pay your mortgage, work with your lender, financial advisor and Realtor to understand your options. The stakes are high, so it is wise to be proactive rather than reactive. And if you are interested in exploring the foreclosure market, contact an experienced, local Realtor. There may be just the property out there that you have been waiting for.
You can contact me at 936-537-1656 or at Claudia@ClaudiaHohlt.com.
Monday, December 28, 2009
Selecting a Real Estate Agent
Santa brought a great gift to the Hohlt household this year. Our daughter and her family who live in Dallas have decided to move back to Montgomery County. We’re looking forward to spending much more time with her, her husband and our three granddaughters.
Their first order of business will be to sell their home in Dallas. Over the Thanksgiving holidays, they asked for some advice on how to choose a Realtor to list their home. I had to commend them for asking, as choosing a Realtor will be the most important decision they’ll make in selling their home. Choosing the right agent will not only maximize the price they’ll get for their home, it will minimize their stress level. But with so many agents in Dallas to choose from, a little due diligence will be necessary on their part. So with 2 goals in mind, i.e. maximum price and minimum stress, here are a few of things I asked them to look out for in an agent.
To maximize the price you get for your home:
1. A Realtor should be an expert on pricing a home. That requires not only the assessment of comparable sales, but also evaluation of pricing trends as indicated by local market conditions. A home should be priced right from the onset. If priced too high, a home will languish on the market. If priced too low the home may sell quickly but the owner may also leave money on the table.
2. A Realtor should be able to put together a listing product that gives justice to the home’s true merits. A compelling narrative and high quality photographs should make a home stand out among its competition and entice potential buyers to schedule a showing. An extensive internet strategy, staging tips, print advertising, signage, brochures, and virtual tours are a few other items that, if effectively done, help attract potential buyers.
3. A Realtor should also provide ongoing feedback on buyer interest and changes in market conditions so that timely adjustments can be made to the home presentation, marketing plan or price.
To minimize the stress while selling your home:
1. Every real estate transaction has its unique challenges. An experienced Realtor should be able to anticipate potential problems and prevent them from interfering with a successful transaction and adding to the stress load of the home seller.
2. Good communication and people skills are a must in a Realtor. A home seller should always feel comfortable calling their Realtor at any time for any reason. A Realtor also needs to effectively communicate with the many others that will be involved in the process of selling your home.
Selling a home is typically one of the largest transactions a person makes in their lifetime. It is definitely worth the time to do some homework in selecting the person to whom you will entrust to represent you in this important task. Don’t hesitate to ask several Realtors to give you an in-home listing presentation. And check out the quality of their past work, e.g. other listings, and check references. A little due diligence on the front end will pay off in more ways than just dollars.
If you're in need of a Realtor in Montgomery County, please give me a call. I'm at 936-537-1656 and at Claudia@ClaudiaHohlt.com.
Their first order of business will be to sell their home in Dallas. Over the Thanksgiving holidays, they asked for some advice on how to choose a Realtor to list their home. I had to commend them for asking, as choosing a Realtor will be the most important decision they’ll make in selling their home. Choosing the right agent will not only maximize the price they’ll get for their home, it will minimize their stress level. But with so many agents in Dallas to choose from, a little due diligence will be necessary on their part. So with 2 goals in mind, i.e. maximum price and minimum stress, here are a few of things I asked them to look out for in an agent.
To maximize the price you get for your home:
1. A Realtor should be an expert on pricing a home. That requires not only the assessment of comparable sales, but also evaluation of pricing trends as indicated by local market conditions. A home should be priced right from the onset. If priced too high, a home will languish on the market. If priced too low the home may sell quickly but the owner may also leave money on the table.
2. A Realtor should be able to put together a listing product that gives justice to the home’s true merits. A compelling narrative and high quality photographs should make a home stand out among its competition and entice potential buyers to schedule a showing. An extensive internet strategy, staging tips, print advertising, signage, brochures, and virtual tours are a few other items that, if effectively done, help attract potential buyers.
3. A Realtor should also provide ongoing feedback on buyer interest and changes in market conditions so that timely adjustments can be made to the home presentation, marketing plan or price.
To minimize the stress while selling your home:
1. Every real estate transaction has its unique challenges. An experienced Realtor should be able to anticipate potential problems and prevent them from interfering with a successful transaction and adding to the stress load of the home seller.
2. Good communication and people skills are a must in a Realtor. A home seller should always feel comfortable calling their Realtor at any time for any reason. A Realtor also needs to effectively communicate with the many others that will be involved in the process of selling your home.
Selling a home is typically one of the largest transactions a person makes in their lifetime. It is definitely worth the time to do some homework in selecting the person to whom you will entrust to represent you in this important task. Don’t hesitate to ask several Realtors to give you an in-home listing presentation. And check out the quality of their past work, e.g. other listings, and check references. A little due diligence on the front end will pay off in more ways than just dollars.
If you're in need of a Realtor in Montgomery County, please give me a call. I'm at 936-537-1656 and at Claudia@ClaudiaHohlt.com.
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