Image by stevendepolo via Flickr

Real estate buyers have the option of having an agent work with them during the home buying experience. A “Buyer’s Agent” has an obligation to pursue the interests of the buyer finding suitable homes that fit their financial capability (budget), find homes with a good location, keep information confidential, and most importantly present any written offers on homes that are deemed, “OK”.

And ultimately handing you the house keys.

In real estate, the written offer is essential

The Regional Real Estate Sales Contract used in Northern Virginia by Realtors has been refined and reviewed by committees, lawyers and the court over the years. The Contract includes all the consumer protections that are available, and the Virginia Jurisdictional Addendum adds additional language regarding home in Home Owner Associations or are Condominiums Rules, Fees, or Amenities.

Putting together an offer requires a level of skill especially when the real estate market is active. Yes, being sloppy will sink your offer quickly when you are up against someone offering the exact same amount of money to a home seller. Not including a pre-approval letter from a familiar mortgage lender or demanding a response on a brand new house listing may also tip the scale in the wrong direction.

Finding the right house is the easy part, really!

This year has had its share of unique experiences where the deal could have fallen apart if I had not handled properly. There was the case where the other agent had a fit when my client stalled signing Form 100 two weeks before closing (it settled on time), or the  agent who did not return calls on a 365 day-old listing (which I eventually sold for over $1.5 million), or the law firm who collected past due mortgage payments but did not send it to the mortgage lender (closing was delayed, but it closed), or the extremely low appraisal that triggered a new set of negotiations (the seller reduced the price).

Home Buying Mistakes will cost you

So hearing from some buyers recently that “they were not going to work with an agent” gave me a shock. It seems that, with all the home buyer tips and information out there including blogs like this, that buying a home in Northern Virginia appears pretty easy. But the reality is once they have found the house… you know, the one they have been looking to find for the past two years, that they are unable to successfully make an offer.

This buyer strategy seems to focus on dealing directly with the seller’s listing agent, throwing caution to the wind that they will be treated fairly, and assuming the real estate agent is going to give a better deal since they won’t be splitting the commission. Here is my insider tip: that real estate strategy may work on a house that’s been for sale since last summer, but it is not going to work on the house listed last Thursday and has home buyers crawling all over it.

Hey, if you want to spend the next year going to open houses and getting e-mails from Realtors then that is your choice. But you need to know that I have helped many people buy their dream home in a time efficient, cost effective home buying system giving organized home buying tips and professional guidance that get the deal done. Really, finding the right home is the easy part!

I’m open to reading your experiences of keeping the deal together, or finding the house and having it sold before you heard back from the seller’s agent. Go ahead, leave a comment.

Related articles by Zemanta

• Meet Your Real Estate Team! (zillow.com)
• The REALTOR’s role as a Buyer’s Agent (dougfrancis.com)

Home Bought and Sold June 2010

Gorgeous oak hardwood floors on the entire main level, a finished walk-out basement with a fifth bedroom, huge rec room, work room and plenty of storage.   The master bedroom has a sitting area, two walk-in closets, a luxury bath with a soaking tub and separate shower.

Gourmet kitchen of granite counters and maple cabinets, two gas fireplaces, side load garage, main level laundry, dual zone gas heating and central cooling…

A two level deck is perfect for entertaining and overlooks the yard and woods. Yes, there is a full size hot tub on the lower deck!

See more photos right now on Google Picasa. Use the slide show option.

The home is on lockbox for REALTORS, or you can call Doug Francis, REALTOR, for a private showing @ 703-304-6827 Listed @ $875,000 and Sold @ $875,000!

Image via Wikipedia

If you are looking to buy or sell a home, I’m sure you have used  Google to do most of your research. In a recent conversation with a REALTOR colleague in Falls Church, Virginia, she shared how home buyers walking into her Sunday open-house already knowing the tax assessment, local school scores, neighborhood comparables and much more. They were well versed in the subject matter (buying a home in that neighborhood) and had brought their A-game. Agents love buyers who are willing to make decisions quickly because our real estate market remains one of the most active in the country.

Home sellers have always reviewed recent comps…

now home buyers are getting well prepped

This change is good and going to get better. But there is something all the Google-ing can’t answer, and that is where a talented agent is going to shine. Knowing the Walkability Score, the school test scores, the Zestimate or the impact the power lines may have will not help understand the true motivations of the decision makers.

Here are some of my musings as I drive through the Wendover Community in Vienna, VA along Lawyers Road between Vienna and Reston.

Please contact me if you are interested in confidentially discussing your home buying options. Many of my clients are senior level technology people, established professionals, and transferees from around the country.

My e-mail address is doug@dougfrancis.com

Related articles by Zemanta

• Buying a home in Vienna over a million? (dougfrancis.com)
• The REALTOR’s role as a Buyer’s Agent (dougfrancis.com)

If you are or have a friend who is thinking about buying a home and taking advantage of the $8,000 first-time home buyer tax credit, then there are some facts you need to know, and we need to talk today. Especially since everyone and their little brother/sister knows about the current affordability index… more on that below. And this isn’t just information for my real estate clients in Northern Virginia, but for any home buyer out there across the USA!

Home Buyer Tax Credit info you should know:

• There is a deadline: Have a contract by May 1, 2010 and settle before July 1, 2010
• The income caps for the full $8,000:

Individual Filers with a modified AGI of $125,000
Joint Filers with a modified AGI up to $225,000

• First-timers are defined as someone who has not owned a home in the last 3 years
• Primary residence only (main home)
• A fast transaction from contract to closing is 30 days
• Most lenders suggest giving FHA loans a 45 day window
• The Fairfax County Courthouse is closed for Memorial Day.
• If rates change, your lender may have to give you a new estimate with a new review period.

So your strategy needs to start right now because I am seeing multiple offers on many places as buyers are rushing to beat the Home Buyer Tax Credit deadline. Work the time frame backwards for a minute because the big “crush” on mortgage companies will probably come at the end of June (code for delays). I am going to feel a bit uncomfortable if settlement is after the 19th and will advise you of the risk. With many loans today being of the FHA variety, lets move back another 45 days meaning you need a ratified contract by early April!

So what is this affordability index?

Prices are down about 15% since last year, and 30-year fixed rates that were at 6.5% last year are now lower than you may think. For example Curt Gilbert at Bank of America sent me a rate sheet on 10/30/2009 showing an FHA rate at 5.00% with 0.50 points. Conventional financing to $729,000 has rates close to 5.00% too.

For IRS details, (I will update this)

Time is passing quickly and we should be discussing a game plan right now or you may just miss the Home Buyer Tax Credit for 2010. My contact information is on the Contact Me page.

Related articles by Zemanta

• Question: Will the tax credit be extended to 2011? (rerockstar.com)

In the Washington D.C. metro area, we have Realtor Associations in Maryland, D.C., and Virginia, plus many Realtor sub-associations in each state. Some agents get licensed in all three jurisdictions which also means they need to join each association (yes, it does sound like a racket to me too). But, this is where some agents may be trying to skip a step when working on the other side of the river.

Well, the first time the box did not work I just called the agent and left a message. The second time I left a message too. I figured out the Maryland connection through a little detective work… their telephone numbers were area code 301.

Maybe a trench coat would help my business? Or maybe that’s a 301 redirect (too geeky?)

Silence.

No response, no thank you’s, and no call saying that they changed the box so please come back.

They did not care about the situation… probably because driving from Maryland into Northern Virginia almost requires you to go through Tysons Corner where the Capital Beltway is torn up and traffic is snarled 18-hours a day.

The lesson for the Sellers: If your agent installs an out of area lock-box, then you have a gross negligence case.

Maybe it’s time to find someone who cares about selling your home!

… look at the interior photos! This home is not asking a 3rd party for approval! Not a foreclosure either… super clean and ready to settle by the end of the year!

Mint condition town home located close to Fair Oaks, Fairfax, and some of the best shopping on the East Coast including Wegman’s, Whole Foods, REI, Costco, Target and the Merrifield Garden Center. Walk to an almost new Fairfax County Elementary School (Eagle View), Fairfax County parks and walking trails and so much more.

3 level, rear load two-car garage, almost new condition. 3 bedrooms, 2 full and 2 half baths

All ready to close quickly. But we need to set up a time to see it this weekend… 703-304-6827.

Equal Housing Opportunity!

View Larger Map and settl

Government insured loans such as FHA or Veterans Administration (VA) have not impacted because they do not sell their loans through the Fannie/Freddie mortgage market.

So what’s the big deal? Haven’t all real estate loans required appraisals?

Maybe a little history lesson will help.

In 2007, New York Attorney General Andrew Cuomo sued an appraisal company accusing it of colluding with Washington Mutual Home Loans of using only appraisers who inflated property values, which “helped set the mortgage crisis in motion.” This case was settled out of court.

As part of the settlement, Fannie Mae and Freddie Mac agreed to adopt a set of rules spelling out how appraisals will be handled for any mortgage that they would be a part of, and that is a very high percentage of the mortgage loans across the United States. These became the HVCC guidelines,  just four pages long. The main purpose is to keep lenders and appraisers honest by limiting the chance that the appraisal process will be influenced by someone who is part of the loan process.

“The HVCC is designed to promote professional appraisals free from inappropriate pressure from lenders, borrowers, or mortgage brokers.” – Federal Housing Finance Agency

Sounds reasonable to me.

In reality, it has created a new layer of bureaucracy. Mortgage lenders are the ones who order appraisals, and with this “wall” between them, someone is needed to contact the appraisers.

American Motor Corp.

To fill that void, we welcome Appraisal Management Companies (AMCs) to the mix. The AMCs assign appraisers from a list as the orders come in from the lenders.

Here are a few of the rubs:

• The cost of most appraisals have increased
• Appraisers are now asked to do more work if they want to stay on the list
• The actual appraisers are being paid less, there is another hand in the till
• AMCs are assigning appraisers based on geographic location, such as Virginia (a rather large state)
• Many appraisals are now missing items that impact value, resulting in low appraisals
• Many transactions are being renegotiated or canceled due to low appraisals

The Regional Sales Contract for residential real estate used in Northern Virginia has a contingency that the home must appraise at or above the contract sales price. Only in fire-sale prices do we see appraisal above the contract price since appraisers follow the market and not lead the market. As a result, it it essential that appraisers have all the information when calculating value because any missing data may result in an appraisal far below actual value.

So home sellers are not the only ones impacted when appraisals are off the mark… ask a buyer who negotiated a good deal only to have it fall apart because the appraisal came in too low. Yes, the seller can say, “sorry, the deal is off with you. Bye, bye now.”

And unknown to the buyer who thought he had a “done-deal” and now needs to start looking again,  there may be another home buyer with more cash on hand to snap up that great deal. On the other hand, the seller may be left waiting another month for another offer that will probably be lower than the last one.

I can understand his reason for asking the question because I certainly would not want to move my wife and children into a crime plagued neighborhood either. But asking a salesman who is trying to “make-the-sale” such a question is crazy, risky, and the last thing he should have been doing. Yes, I consider myself trust-worthy but I don’t live in the neighborhood and really have no idea if someone had broken into a car over the weekend.

Get it?

Asking real estate agents for local crime info just isn’t a good idea.

So I always suggest people look up the data on the excellent police web sites, and here are a few from my market area in Northern Virginia or the Washington D.C. suburbs.

• The Fairfax County Police Department
• The Arlington County Police Department
• The City of Alexandria Police Department
• The City of Falls Church Police Department
• The City of Fairfax Police Department
• Town of Herndon Police Department
• Town of Vienna Police Department
• Loudoun County Sheriff’s Office
• The Prince William County Police Department

If there is another police department that I have left out then I will be happy to add them too!

So after you have surfed through umpteen home-search web sites late one night, contacting a reputable lender and completing a basic loan application will get the ball rolling! I know some.

Have you been paying you bills on time?

It’s a hard-and-fast rule…

Related articles by Zemanta

• Your FICO Score will take a hit from Damage Points (dougfrancis.com)

Numbers for 22101:

• Total Units Sold in August 2009, 42 vs. 40 in 2008 (up 5.00%)
• Average Sold Price in August 2009, $1,035,690 vs. $960,431 in 2008 (up 7.84%)
• In the $700,000 to $799,999 range, 6 sold with 16 active listings
• In the $800,000 to $899,999 range, 4 sold with 12 active listings
• In the $900,000 to $999,999 range, 6 sold with 14 active listings
• In the $1,000,000 to $2,499,999 range, 16 sold with 120 active listings
• In the $2,500,000 to $4,999,999 range, 1 sold with 15 active listings
• Average days on market in August 2009 was 93 vs. 105 in 2008
• The average sold price in 2009 was 93.46% of the average list price

Numbers for 22102:

• Total Units Sold in August 2009, 25 vs. 27 in 2008 (down 7.41%)
• Average Sold Price in August 2009, $599,160 vs. $1,050,865 in 2008 (down 42.98%) **
• In the $700,000 to $799,999 range, 1sold with 5 active listings
• In the $800,000 to $899,999 range, 2 sold with 6 active listings
• In the $900,000 to $999,999 range, 3 sold with 5 active listings
• In the $1,000,000 to $2,499,999 range, 3 sold with 61 active listings
• In the $2,500,000 to $4,999,999 range, 0 sold with 33 active listings
• In the $5,000,000 & Over range, 0 sold with 8 active listings
• Average days on market in July 2009 was 91 vs. 118 in 2008
• The average sold price in 2009 was 90.51% of the average list price

**This zip code reflects some extremes in pricing as there were 14 sales under $500k and 3 sales over $1. million. The McLean home market includes condominiums in all price ranges.