Its that time of year where the market opens up its gates and the houses start popping up everywhere.  I was on Realtor tour today, turned down a street and saw 5 houses all for sale. Yikes!  I’d hold some group open houses if I were those agents.  We are in the start of our open house season.

So that leads me to discuss the ever so big question of, “do open houses work?”  I get asked this question a lot.  All across the board I think you’ll find agents come up with different answers and different reasons for those answers.  I think it depends on what the agents ultimate objective is.  Are they looking for buyers to represent?  Are they looking to actually sell the house they’re in?  Are they looking to get as much foot traffic in the house as possible? As a seller, you’ve got to ask yourself would it work in my neighborhood?  Is it worth me being kicked out of my house on Sunday?  Here are a few commonly asked questions regarding open houses.  Every agent is going to have a different story probably depending on their market.  Afterall, all real estate is local and trends in every neighborhood are different.

1. Do open houses sell the house that is open? Directly- usually not.  Indirectly-  possibly.  I know that’s a wishy washy answer, but its a complicated question.  Rarely does a person walk into a house, never having seen it before fall in love with it and buy it.  Sometimes they see it online, go through it with their agent and then go back through it at the open (bringing their friends, family, etc) and then end up buying it (or the order of that could be reversed - go through it, see it online and go back with their agent).  As buyers agents, open houses are nice because some clients are fine checking them out on their own on Sundays and letting you know which ones would work or not for them.  The 2008 NAR study of buyers and sellers says that 15% of buyers found the home they purchased from a yard sign or an open house sign (I wish they would break that statistic down further).  So, its a good idea to have them, it just shouldn’t be your only marketing effort to sell your house.

2. Why do most agents hold Open Houses? 2 reasons: 1. to get traffic through and hope that a buyer will walk through the doors or 2. for the agent to find prospective (unattached) buyers.  The latter is usually the main reason agents hold open houses.  They want to pick up buyers.  So to my sellers I always suggest to hold it open right at the beginning of the listing.  Get the momentum going and get people talking about your house.  Also do them at price reductions, or if significant changes are made. You don’t want to hold your house open every weekend.  It becomes shop worn… If my sellers insist, I will do them, I just let them know up front not to expect a lot.  Its a very passive way of marketing.  These times call for something more aggressive.

3. What is an Broker Open House? This I find is the real way to get your house sold (if you’re going to go with open houses - I’ve sold a couple just from Agent tour).  Its called Agent/Broker tour.  Its not always popular everywhere, but where I work all the agents are extremely tour conscious.  Here in Cincinnati, every Tuesday agents can hold open their listings (or upcoming listings) for other agents to view.  Many Times we have lunch or things to entice agents to make it to our home.   This is a great way for Agents (who are in contact with MANY buyers) to see your home and possilby come back with clients.  Or maybe you don’t have a client yet, but when you do, you can remember that you’ve been through it and recommend it.

4. Open house activity doesn’t correlate with potential buyer activity: Many times (especially as the weather gets nicer) people who aren’t even looking to move will spend their Sundays going to open houses.  Its a nice free way to spend the afternoon.  As the trees bloom so do the ‘tire kickers.’  Make sure your agent knows how to spot the difference between a looker and a keeper.

Over all, Open houses should still be apart of a marketing strategy, but it shouldn’t be the only one.  If that’s all your agent is doing for you, you may want to consider a new agent. On occasion I have been known to coordinate a ‘neighborhood wide’ open house.  Where every agent held their home open at the same time so that buyers could go through them all at once.  Each time I’ve coordinated it, I’ve actually sold the house I had listed.  It wasn’t your average open house, so its not going to produce average results.

What are your thoughts?  As buyers/sellers do you find open houses helpful or not?

I saw a startling statistic last week that prompted me to write this post.  It said that “58% of all Cincinnati agents sold 3 homes or less in 2008.”  YIKES!  That means over half of the agents out there are not working full time?  They’re only doing 1-3 deals a year.  How on earth are they paying their bills?  Real Estate isn’t that bad as to only allow 3 transactions a year.  It is a signal to me that there are many part time agents out there.  Would you want your surgeon to only have done 3 surgery’s before he works on you?  Absolutely not, then why would you want to trust someone with your largest financial decision that doesn’t have the experience or the qualification?  I think there are still a lot of part time agents out there.

I won’t bore you or try to sell you one me (of course my business partner and I completed 46 transactions last year…) but I do want you to think about who you are choosing and why you are choosing them.  As a seller or a buyer you should be prepared to ask your agent questions and make sure they’re qualified to handle your transaction from start to finish.   Here are a few things to make sure of:

1. Be sure that your agent and all parties involved are full time -  I’m currently trying to hammer out a deal where the LOAN OFFICER is part time and doing my client a ‘favor’ as a friend.  Not having someone who has dealt with many different scenarios in the business has been a trying time for both myself and my client.  I just hope we make it to closing…Of course some agents will tell you anything to get your business, but you can ask to see results and references.

2. Make sure they know the area - This would apply more on the listing side than on the buying side of the transaction.  A buyers agent can pull up comparables of any area to make sure a buyer isn’t paying more than the area/neighborhood demands.  For the listing side, you want to make sure that the agent is well connected or willing to engage in the community where possible when listing your home.  We recently spoke to a seller who was willing to go with a particular agent because they were really nice and helpful, but they had never sold in the neighborhood/market area nor do they know anyone in that market segment… it didn’t make sense to me.

3. Don’t just pick an agent because they have the lowest price - the old ‘you get what you pay for’ motto is around for a reason.  I’ve had friends choose discount brokers to ’save money’ and then they get no help on the pricing, contracts, or anything.  What motivation does an agent have if you cut their price down to nothing?

4. Don’t be afraid to ask to see results or ask how their marketing differs from the competition.  Everyone can put your house on the internet, not everyone can get a contract and keep the deal together.

5. Your agent should be a professional.  Don’t just work with a friend because they’re your friend.  Make sure they’ll do the job you want them to do.  Whenever a friend asks me to list or help them buy, I always have the ‘lets keep business, business and friendship friendship’ I don’t want business to interfere with our friendship and I lay specific ground rules for keeping it that way.  I always want to help a friend out and make sure they get the best service possible.

Essentially, do your homework.  If you’re going out to purchase a car or buy the next gadget, you’re probably doing some research ahead of time.  Make sure you do it with your agent.  The best place to start is just by googling their name…

Everyone has been asking, waiting and wondering; “how do I file my taxes to include my credit?”  Well, all of you early birds can rest a bit easy.  The forms are now up on the IRS website ready for you fill in.

Enjoy and passs on.

This is so exciting I had to post it on this blog as well.  For my readers who don’t know. I’ve got another blog which is dedicated to all thing green, real estate and Cincinnati related.  Check it out at www.encorecincinnati.com

For all my Norwood readers, would you be interested in something like this in our city?

Below is the post as well:

I blogged about it months ago.  A few of you even commented that if I bought the land you’d till the soil.  Well it turns out that City Council last week finally passed a plan for mini-farms.  What is a mini farm or an urban farm?  Well, its exactly what it sounds like: a small farm in an urban setting.  Why you ask?  Well, there is always a question of what to do with some of the vacant unusable city plots of land.  Most of them are unbuildable plots and just sit vacant and uncared for. Many major cities have started using these plats as small gardens and farms for city dwellers.  The exact details will be worked out in the next month.  City officials must decide how to lease the plots, and whether to charge anything. Lets hope they don’t.  Bring back the victory gardens of WWI & WWII.

How soon can we expect these little gardens of nutrition to start springing up?  Well, council expect 10 to 15 plots to be ready for growing this spring as a pilot project.  Yippee! Local food is where its at.  Lets help beautify the city.

I wonder if Norwood would be interested in something like this??

To read the full article in today’s enquirer click here.

The details are out.  Not as great as I’d like, but some of the changes have been for the positive.

Here is the scoop:

1. the limit has been increased to 8k max

2. Any single family residence (including condos, co-ops, townhouses) that will be used as a principal residence.

3. Income limits - Full amount of credit available for individuals with adjusted gross income of no more than $75,000 ($150,000 on a joint return). Phases out above those caps ($95,000 and $170,000).

4. Repayment - No repayment for purchases on or after January 1, 2009 and before December 1, 2009

5. Effective on purchases Jan 1, 2009-Dec 1, 2009

For a full comparison of the old vs. new tax credits click here.

I really wish that the entire credit would have been made open to all home buyers.  This really would have stimulated the move-up buyers who are having trouble with getting motivated to sell their homes and move to the next phase.  Perhaps if they  had some incentive, there would be more sales outside the 100-300 range.  Overall, the changes they’ve made are good and I hope those who get it, actually put that money back into the economy.

If you have any questions, email me or talk to your loan officer.

With all of the economic talk the past few months and how housing is in the toilet… I thought it would be fitting to actually show some real estate numbers for Cincinnati.  It is a suburb / municipality comparison of annual single family homes sold, along with the corresponding “average sales price.”

Lets take a look at some of our favorite suburbs:

If there is a specific suburb you want to know about, just ask and  I’ll post it.  Take note - there are actually some areas that have higher average sales prices in 2008 than in 2007.  This is not an appreciation calculation, just simply what the ‘average sales price’ was for that corresponding area.  We can see that some prices are holding in certain areas and others aren’t.  However, this doesn’t mean that your house has devalued, in order to figure that out, you will need a professional to come in and make that assessment.  If you’re not planning on moving anytime soon, don’t worry just stay put and continue to pay your house down.  If you need help figuring out if you should sell or not give me a call.  I can help you assess your specific situation.

Its 7,500 for first time home buyers only and must be paid back.  Next its $15,000 open to all home buyers, now it $8,000, now its gone?….  What is it?  What do we know about the fate of this home buyer tax credit?

Well, unfortunately nothing has been decided officially, yet… So that means until the president signs it, its up to change and change again.  No one disputes the fact that we need something to spur the housing market, they just can’t decide what form it will take.

I’ve been faithfully watching  C-Span waiting to hear something about the fate of this, but nothing has been decided.  Last I looked the house was actually congratulating the Pittsburg Steelers for their 6th super bowl win.  I’m happy that they’re really doing great stuff down there in Washington.

After searching the web, I’ve found a few things - but once again nothing is final until the president signs and there are reports that will not be until Monday at the earliest.

• The $15,000 tax credit for home buyers that was in the Senate’s version has been reduced to $8,000.
• The $8,000 tax credit will only be for first time home buyers
• Unlike the already existing $7,500 first time home buyer “credit”, the new $8,000 is a true tax credit – it does not have to be repaid. The $7,500 credit needed to be paid back over 15 years

At least there is something back on the table.  Yesterday they wiped out the 15,000 all together.  It will be interesting to see how it all pans out.    I just hope it doesn’t create another bubble or have some other ill effect that we weren’t hoping for.

Now back on C-Span the house has moved on to discuss the naming of the post office in Sparta Georgia….

It seems as though the Cincinnati housing market is picking up since the holidays, even with the snow we’ve had.  I’ve spent the past week trudging around everyday in the snow!  Buyers don’t run around in the snow for no reason, they’re serious.  But not everyone is thinking the market is as good as I do.  So that has got me thinking.  Who is buying right now? When I look at the majority of my sales over the past few months, I’ve definitely seen a trend.  Well, I can’t speak for everyone but this is what I personally see:

First time home buyers with at least 3.5%down in the 100-250k price range.  They have started to jump on the buying trend, mostly due to the low rates (in the low 5%’s)  and the great incentives ($7500 tax credit).  Its great that these people are buying up some of the stagnant inventory that is out there.   Those who aren’t first time home buyers?  They seem to be sellers who don’t have to sell to buy or they sell their home first and then go out shopping for homes.

So that begs the question, what about those sellers who HAVE to sell before they buy, but are reluctant to do so because they’re not going to get as much as they want/need from their home.  Some sellers see that if they take a little hit on their home now, if they’re buying in the next price range they can take advantage of the great market and save on their new home.  This logic doesn’t work for everyone.  Most of us out there are a direct benefits kind of consumer.  We need to see the direct savings.  I’ve been trying to think of what would spur these buyers/sellers to take the plunge and help us out of our national housing crisis.

Well, over the past few day’s I’ve heard the flurry of news activity around another tax credit being introduced in our stimulus package.  The proposal would allow a tax credit of 10 percent of the value of new or existing residences, up to a $15,000 limit.  Current law provides for a $7,500 tax break but only for first-time home buyers.  This new credit would be open to everyone.  I think this is a step in the right direction.  First time home buyers have begun to take the plunge, its the others that need a little boost.   If its not this tax credit, it needs to be something like it.

Stay tuned for more details and if you have questions feel free to email me.  I’m happy to help.

Short Sales are popping up all over the place. Everyone likes trying to get a deal in Real Estate these days.  Don’t get me wrong, there are lots of deals to be had (when you compare todays prices with those 3-4yrs ago).  In fact we are close to 2003-2004 prices!  The most common misconception about short sales, is that they’re short in process. This is far from the truth. Short sales can actually take a VERY long time.  I’ve had clients wait up to 6 months for a home only to find out the bank(s) have rejected their offer.  YIKES! 

If you’re only dealing with 1 bank, the process seems to be a lot faster than if the seller has multiple mortgages and home equity lines out on the property.  All of these banks must agree to a lesser amount than what their owed.   The more banks there are, the more time they take.  However, the good news is banks seem to be getting more realistic about pricing and condition.  I think they see the short sale market growing and they need to move fast.

As for condition of the property? Sometime they’re in good shape, other times they’re not.  It all depends on the homeowner and their financial situation.  They’re usually in better shape than an actually foreclosure.  But no guarantees anywhere.

In short, these sales can be worth a buyers time, if they’ve got it.

Our society seems to run on trends.  People are always searching for the latest coolest thing to do, wear or say.  Housing is no exception to this.  Often times we see people giving their homes the latest trend make over in order to sell it fast.   Anyone can google the latest housing trend or in fact all they have to do is open up the latest pottery barn or crate n’ barrel magazines to see it.  But for those people looking to remodel and not sell until a year or 2 down the road.  What about them?  How can they make best use of their money now?  Should they put granite/stainless steel in the kitchen?  Or will it just be outdated in 2 years?  Trends are always hard to predict, but there are a few that are starting to fall by the wayside.  According to a recent article I read theses seem to be the top trends leaving… I’m not sure I agree with all of these.  I’ll post my opinion in italics…

1. Fireplaces: The fireplace skyrocketed in importance in homes in 1991 with 62 percent of new homes having one or more. But the number has steadily been decreasing ever since. In 2007, the number dropped to 51 percent. 

I’m not sure I agree with this one.  In my area, most of the fireplaces don’t work but people still love having them around.  There is a sense of nostalgiawhen it comes to a fireplace.  Especially the Rookwood ones we have.

2. Carpet: While 54 percent of homes still have carpet floors, the number is decreasing and hardwood floors are taking the place. Vinyl and ceramic tile flooring also are being bypassed more by buyers. Seventeen percent of new homes contain hardwood floors throughout the entire house. 

I do agree with this.  Most buyers I have prefer to have hardwood floors.  Some of them still want carpet in the bedrooms.

3. Living room: These once-decorative centerpieces of homes are slowly vanishing from newer homes. Thirty-four percent of consumers say they’re willing to buy a home without a living room.

I’m assuming that this is the ‘formal living room’ that new construction and older homes don’t have.  I find people want a family/living type room.  Gone are the days of the family room and a formal living room. Today’s buyer wants a room that will work for both purposes.

4. Desks in the kitchen: These desks were once looked at as great storage areas but they’re often too small and quickly become clutter spaces in a home, said Gayle Butler, editor in chief of Better Homes and Gardens. Instead, more consumers say they prefer larger desks in or near the family room—equipped with a messaging center—where they can keep an eye on their kids as they work on the computer.

Ha Ha, this one makes me laugh.   Of course these aren’t in any of the older homes I sell.  But I do see them in the suburbs.   We actually had one in the house I grew up in.  My mom used it all of the time.  Of course those were they days before the personal computer.  Now, we’ve got home offices and computer rooms taking the place of these spaces.  People find it a waste of space today.

5. Skylights: The little windows that allow natural light to seep into a home from above are falling out of style. Only 10 percent of new homes will include them this year, a continuing downward spiral for skylights.

I don’t have anyone that dislikes skylights.  I don’t really see this one as being a dying trend.

6. Upscale kitchen finishes: Granite counter tops are slowly becoming less desirable among buyers who are now moving toward affordable, low-maintenance laminate countertops—which tend to last longer and now come in various styles.

This still seems to be a trend in our Cincinnati market.  Everyone is wanting the granite and stainless steel kitchens.  I have often thought of all these kitchens becoming outdated relatively quickly.  My thought is, don’t do it to sell.  Do it because you want to and enjoy it while you’ve got it. 

When it comes to equipping your home with the latest and greatest you take a risk that it will become outdated eventually.  If you enjoy it, then its worth the money.  Have you seen any trends out there that you think are going by the way side?