Real Estate Information Archive

Good Monday Morning!

Right now the Real Estate market in the Eugene and Springfield area is highly competitive.  Record low mortgage interest rates, a renewed interest in our area from out of state buyers and an extremely low inventory of homes for sale has made our current market very challenging for buyers.  The following is an article from "Realty Times", that gives some advice to anyone attempting to purchase a home during our current competitive home market.

Everyday I hear real estate agents say how baffled they are because their Buyers keep losing the house they want to buy due to a multiple offer situation. I feel empathy for Buyers who have spent several weeks or months searching for the home of their dreams, only to find out there are five other people trying to buy the same property. It can be downright frustrating, not to mention time consuming and the emotional roller coaster ride you must feel like you are constantly on.

If you are lucky enough to not be in a multiple situation and having to compete with other Buyers for the home you want to purchase, these items can still guide you on how to make the offer attractive to the Seller.

So, how do you make an offer on the house and actually beat out your competition and get it accepted?  It can be challenging, but there are some tricks to the trade.  As a listing agent, I receive multiple offers on the majority of homes that I list for sale.  My last listing, I received 31 offers.  Did my seller pick the highest price?  No.  There were other factors that were taken into consideration during the decision process.  As an agent representing the Buyer, I have been in situations where we had to compete with other Buyers and we won and it wasn't because we were the highest bidder.  So, how can you make a successful offer on a home?

GET PRE-APPROVED FROM A REPUTABLE MORTGAGE LENDER

A true pre-approval from a lender means that you have provided to that person all your personal financial information and that lender has given said information to an underwriter for approval with the only remaining criteria being, that the home appraises and title is clear.

Why get pre-approved?  It shows the Seller that you are serious and are prepared to purchase his/her home.  Once your offer is accepted, the home is removed from the market and not available to any other Buyers.  So, if the Seller is going to remove his home from other eligible Buyers, it better be for a good, solid Buyer who can go to the closing table without delays from the mortgage lender.

 

CHOOSE AN EXPERIENCED REALTOR TO WORK WITH

This is a large purchase, and I know that sometimes you can get pressured to use your cousin or friend who has their real estate license, because we are all the same, right?  No way!  I always remember the saying...the heart surgeon who graduated at the top of his class is the same as the one that just made it by the the skin of his teeth.  Which one would you pick to do your surgery if they cost the same?  Knowledge from an good Realtor can save you money and help you get the house that you really want.  

DON'T LOWBALL THE SELLER

Before you submit your offer, your agent should have pulled comparables (sold properties in the same area), discussed average days on market for your area and provided you with an estimated sales price of the home that you are about to put an offer on.  If everything comes back acceptable, meaning the house is priced in line with recent sales and there are no signs of delayed maintenance, then it comes down to what you offer.  If the house is priced accordingly and in good repair, offering 25% below asking price to see what the Seller is going to do, is probably going to insult the Seller.  Your result may be a flat out rejection with no counter offer.  What Buyers don't think about,  while you are trying to see how low the Seller will go, you leave the door open for other Buyers to kick you out of the deal.  Now, that doesn't mean you have to pay full price, but the numbers don't lie. That house will sell between the historical sales shown to you.  The Seller and their agent know this.  Unless, you are in a market that is starting to decline, you may get lucky.

PUT A HIGHER AMOUNT DOWN FOR ESCROW

Depending upon where you live, escrow may be called earnest money.  Earnest money is a good faith deposit that basically tells the Seller you are serious about purchasing their home.  The higher the amount, the more skin you, the Buyer, has in the game.  Remember, the Seller is looking for a sure thing.  They want to close with the first Buyer, not the third.  Putting more money down as escrow tells the Seller you are less likely to default or risk losing your money.

Earnest money is credited to you at the closing table.  You do not lose that money if you close.

HAVE YOUR LENDER CALL THE LISTING AGENT

The lender that calls the listing agent, who represents the Seller, and explains that the Buyer is a solid Buyer, credit has been pulled and jobs have been verified, just helped the Buyer move to the front of the line.  Having the lender contact the listing agent does two things.  First, it introduces the lender to the agent, who in turn meets with the Seller.  Second, that agent will and advise the Seller which offers he/she thinks will close.  In addition, competency from a mortgage lender is reassuring and allows the Seller to make an informed decision.  There have been several times in my career that the Seller has not accepted an offer due to the questionable loan approval the Buyer presented and the fact we could not reach the mortgage lender to verify. 

BE FLEXIBLE WITH THE CLOSING DATE

When making an offer on a house, there are factors to consider about the Seller,  many that may not be disclosed before the offer is written.  If the Seller needs time to find another place to live or is moving across country, being flexible with the closing date may mean more to the Seller than having a higher dollar offer.  I often call the listing agent before sending over the offer and explain that if the Seller needs more time to exit, the Buyers are flexible with the closing date.  This puts less pressure on the Seller during the moving process, which may be what they need.

SHORTEN YOUR INSPECTION PERIOD

There are several times in the contract where the transaction can go sour for the Seller and one major hurdle that Seller must get past is the home inspection.  By shortening your time frame for the inspection process, this limits the window of opportunity for you to withdraw from the transaction.  You may even write into your offer, that you are looking for major defects only in the home and anything less, you are willing to accept up to a certain dollar amount.  This will reassure the Seller that you are not going to walk or ask them to repair a laundry list of small items.

MEET THE SELLERS

This can be a good idea and sometimes not.  If you really want the house, when you go to view it, ask if the Sellers can be there.  Even if it’s just for a few seconds before you really view the house.  Putting a level of humanity into a transaction can go a long way.  Isn’t that true for a lot of different circumstances?   The last home I bought, I met the Sellers and not only bought the home, but probably got a better deal because I was able to compliment them on all the work that they had done.  I did not give away the fact that I was in love with the house and probably would have paid full price.  I just acknowledged what a good job they had done.  Being kind and grateful can go a long way, and perhaps save you a few dollars too.

Making an offer on a home and getting it accepted can entail other elements of the purchase agreement and not just the money.  However, if you still find that you are consistently getting out bid for a home, consider my last alternative....

RAISE YOUR OFFER AMOUNT-ODD NUMBERS

I am not an advocate for recommending Buyers to overpay for a home.  However, there may be times where a home is priced below market in anticipation of getting multiple offers and having the market dictate the outcome.  As an agent that has represented quite a few Sellers, I have done this many times and it works.  So, let me tell you the secret of making an offer on a house during a multiple offer situation.  After comparables are given to you and you know that the home is priced below market, come in close to market value with an odd numbered offer.  Meaning, most people think in terms of even numbers, right?  So, instead of writing an offer at $255,500 for instance, write the offer amount at $257,660.   I have seen Buyers win the offer by $50.  Overpaying for a home, if you are getting a mortgage may mean not passing an appraisal.  This is where hiring that experienced agent truly pays off in really knowing the market values of your desired area.

Understanding that there are steps to making an offer, or a framework, will guide you through the process.  Having good communication with your Realtor is a must and don't be afraid to ask questions.  This is your time and your money.

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING!

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Good Morning!

With mortgage loans remaining at historic low levels and the brisk housing market, I find many home buyers making huge mortgage loan mistakes.  Here is a recent article from "Realty Times", that just might help you if you are in the market for a mortgage loan.

For most buyers, the mortgage is the largest monthly expense they will have. Yet most borrowers will do little to no preparation, negotiation, or shopping to get the best deal. And they end up paying much more for their loans than they need to. You? You're smarter than that, or you wouldn't be reading this article. Here are five of the biggest mistakes that can cost you real money.

1. Believing advertised rates are what you'll pay

Unless you have perfect or near-perfect credit, most advertised rates are out of your league. To get boasting rights on a rate that good, you have to pay part of a point (one percent of the loan amount), or more to get the best rates.

Your lender will go over your credit with a fine-tooth comb to find anything to raise the rate. That includes qualifying you at the beginning of the transaction, and then running your credit again a day or two before you're supposed to close on the home and loan. If there's been any change in your debt-to-income ratio, goodbye low mortgage rate.

2. Not comparing lenders

Just like everyone knows two or three real estate agents or more, everyone knows a loan officer or a mortgage broker. A loan officer works for a bank or savings and loan and can only offer you loan packages that the bank has put together. A mortgage broker prequalifies you just like a loan officer, and shops your deal around to various lenders.

Whether you talk to a loan officer or a mortgage broker, you're going to have to share personal financial information in order to get a realistic rate. Reputable brokers will show you what certain banks and credit unions quoted and you can pick the loan you like best.

If you'd rather do your own shopping, consider talking to a local bank, a national bank, a credit union, and a savings and loan, but remember, unless you give them personal information and permission to run your credit, it's just talk.

3. Not paying attention to terms

Advertised rates even for those with perfect credit aren't what you will actually pay. The true cost of the loan is the APR or annual percentage rate, which includes fees from the lender.

Understanding loan terms is harder than shopping for a new mattress. There are so many ways lenders can inch up the fees. A loan origination fee is also called a processing fee. It pays the loan officer or mortgage broker, so this fee can vary widely. You may pay one lender more for an appraisal than another might charge you.

One lender may charge more for pulling your credit than another. It's all in your good faith estimate, which you don't get until you've applied for the loan.

All terms are negotiable, so don't be afraid to ask what a particular fee is for and can it be reduced or eliminated.

4. Waiting for a better rate

It's great to have bragging rights on a low rate, but you don't want to lose the home of your dreams over a quarter of a point in interest.

There's a big picture here you could be missing. No matter what your interest rate is, you're going to pay thousands of dollars in interest up front before you make any serious gain in equity. If you go all the way to the end of your loan's term, you'll pay so much interest that you could have bought the same home two or three times.

Instead of focusing on the percentage rate, work on how quickly you can build equity. Make one extra payment a year. Pay $25, $100, or $500 extra per month and you'll more than offset the rate you're paying.

Down the road, if rates drop through the floor, you can refinance, but even that's not an ideal solution. You'll pay loan origination fees, title search fees, appraisal fees and so on -- enough to equal the closing costs you paid the first time around.

And don't forget, you'll start the amortization schedule all over again -- with most of your payments going to interest instead of principal.

5. Choosing the wrong type of loan

Many families were hurt post-9/11 when lenders opened the spigots and gave a loan to almost anyone who could sign the paperwork. Suckers bought homes that were too expensive using balloon loans with low teaser rates.

The type of loan you choose should depend on current market conditions and how long you plan to stay in your home, not how much home you want to buy.

Current market conditions favor fixed rates, because rates are rising from all-time lows. Yes, they cost more than hybrid loans or adjustable rate loans, but the base amount is fixed and doesn't change. Only your taxes and hazard insurance will cost you more over the years.

If you get an adjustable rate mortgage, you are at the mercy of market conditions. While there's a cap on how high your interest rate can go, it's still a risk.

If you plan to stay in your home five years or more, get a fixed-rate mortgage. If you plan to sell your home sooner, you're taking a risk. It takes most borrowers five years just to earn back their original closing costs in equity.

Once you've narrowed your choice of lenders, ask them on the same day to give you a quote. If you wait even one day, rates may have changed, so you're no longer comparing apples to apples.

If you need a good lender, contact me.  I have a list of great local lenders that I can provide you with.

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING!

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Good Monday Morning!

Nationally, home sales  dipped in March of this year slightly. Could this be the beginning of a down turn in the national housing market? Economic numbers for the first quarter did not look great and this could be having some effect on home sales. Most likely we will not be seeing any huge swings in regards to home sales nationally unless there is a sharp increase in mortgage interest rates. For now, I would think that the overall market may flatten out some, but  remain strong. 

One of the largest problems effecting the housing market in many areas is lack of inventory of homes for sale.  This is especailly true with homes in the price ranges that attract first time home buyers. Locally, in the Eugene and Springfield area, we are seeing very low inventories of homes in the lower and middle price ranges.  Buyers are struggling to find homes and many times when they do, there are multiple offers.  It is a great time to be a home seller as homes are selling quickly and prices are beginng to escalate.

Have An Awesome Week!

Video Link: http://eugeneoregonhomesforsale.com/video/This-Month-in-Real-Estate-April-2016

THIS WEEKS HOT HOME LISTING!

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AND HERE'S YOUR MONDAY MORNING COFFEE!!

Good Monday Morning!

It is Spring in the Eugene and Springfield area and this time of year typically brings higher interest by buyers looking to purchase a home. This year is certainly no exception as home sales in the Eugene and Springfield area continue to climb. In fact at this time I believe that there may be more buyers out there in certain price ranges than there are homes for sale. We are currently seeing multiple offers on many homes and this is especially true in price ranges under $300,000.  Our overall inventory of homes for sale is quite low and buyers are scurrying to make offers as soon as many homes hit the market.

For home buyers wishing to purchase a home right now, this can be a challenge and having a top buyers agent who firmly understands the market can make all the difference in the world with regards to being successful in finding a home. Also, a word of caution to home buyers is that there are bidding wars taking place, so be cautious not to over-pay for a home. Again a professional buyers agent can help you here.

For home sellers, if you are going to sell this year, don't hesitate another day in getting your home on the market. Your chances for a quick sale at top market value are better now than at any time I have seen in years. There are lots of home buyers out there looking and struggling to find a home to buy.

This is a true sellers market and one thing that has always been true is that strong markets like the current Eugene-Springfield real estate market one don't last forever. 

If you are thinking about selling and want an easy and accurate look at your homes aproximate market value, don't trust Zillow.  Go to www.forhomesellers-nonSmartZip.com.  At this site, you just enter in a few details about your home and it will generate an in depth market report on your home. You might be pleasantly surprised as to how much the value of your home has increased!

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING!

1058 E 19th Ave

Price: $472,000    Beds: 5    Baths: 3    Sq Ft: 3034

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AND HERE'S YOUR MONDAY MORNING COFFEE!!