All posts by Dorothy Swearingen

Home Sales in Highlands Get Mixed (or Mixed-Up) Signals

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As we enter the spring selling season, it’s only natural to look for clues about what to expect for Highlands home sales. Normally, one of the principal barometers comes from the National Association of Realtors®. Their Pending Home Sales Index is a national compendium of hard data that can be useful for predicting home sales in Highlands. It is both “forward-looking” (an indicator of future activity) and part of a long-standing and continuous sample-gathering procedure.

When you take a wide sample of the same data for the better part of a decade (the PHSI has been recorded monthly for nine years now), you can chart the results, note when similar patterns repeat or diverge, and infer meaningful results. Further, when an acknowledged authority like NAR’s Chief Economist Dr. Lawrence Yun provides commentary in plain English that any Highlands homeowner can easily understand, the monthly published reports comprise perhaps the best basis there is to project how our own local market is likely to fare.

Last week’s release of the Pending Home Sales Index and commentary was every bit as authoritative as we have come to expect—backed up by the same rigorously collected data from across the country. As a tool for projecting how upcoming Highlands home sales are likely to fare, however, it’s fair to say its usefulness is…uh…less than usual.

It’s fair to say that because it is possible to read the entire 700-word document and emerge without a clue as to what you just read. It is, in a word, confusing. But in case it’s just me who is confused—and you are a typical Highlands homeowner who would appreciate information about how active our market is likely to be in the next few months—I think I should share a boiled-down version of the report’s key takeaways.

The Report’s headline is “Pending Home Sales Cool Down in January” (January’s data is the most recent). From this, we can gather that home sales activity is trending downward. Then, from the first paragraph: “…pending home sales…remained slightly higher than a year ago.” From this, we can gather that home sales activity is trending upward.

There follows an explanation about the first idea (home sales trending lower): it was partly to blame because of bad weather in January. A little later, there is a buoyant observation about the second idea (home sales trending higher): “Sales are now 11.0% higher than a year ago—the largest year-over-year gain since July 2013!” (exclamation point added by me, which seems appropriate, given that this is such good news).

More good news for Highlands homeowners readying to sell their homes dealt with prices: “Last month’s price increase was the largest since April and marks the 47th consecutive month of year-over-year gains!!” (I added the two exclamation points). This, however, was also miserable news: “Home prices ascending…aren’t healthy” because household incomes didn’t rise as fast. But good news would make that much less of a factor, because fixed-rate mortgage rates were really wonderful: “declining to 3.87%, the lowest since October 2015!!!” (exclamation points—oh, you know).

Because sales cooled down in January for the highest year-over-year gain in years, I think the report tells Highlands homeowners that they might well expect a hot-cold/falling-rising market! Or perhaps prudent homeowners should just forget about this report, get their homes ready to list, and call me…I promise not to share what’s in next month’s report!

Reduced Prices Attract Sapphire House Hunters

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When you are skimming through the Sapphire listings, now and then you come across attention-grabbing terms like “one of a kind” or “extremely motivated seller.” “Reduced” is another one.

After all, who doesn’t like a bargain? Especially when that bargain is associated with a major commitment, who wouldn’t think it’s worth looking into? Today’s listings may no longer be saturated with short sales, foreclosures, and scores of listings reduced by enormous percentages, but patient Sapphire house hunters can still strike pay dirt if they are diligent and methodical. Nevertheless, there are some tried-and-true cautions that need to be observed to ensure that the “penny-wise, pound foolish” saying doesn’t wind up describing the result.

Most of what is being written on the subject of real estate bargain hunting falls into the common sense category—for instance

⦁ Low-balling the offer seldom works. The hope that you can create a bargain just by making a shot-in-the-dark low-ball offer is much more likely to result in a resentful homeowner than a successful deal. As in most business transactions, success is more likely to develop when both sides understand the motives and goals of the other. Since any seller whose Sapphire property is on the market is assuredly quite well aware of the likely value of his offering, unless the seller is in desperate need of a deal, this tactic is counterproductive (and if the seller does really need to move on, odds are the property has already been reduced to reflect that).
⦁ ‘As-Is’ also means ‘Heads-Up!’ A home that’s been “reduced” simply means the market is suggesting that an asking price correction is needed. When “as-is” is appended, it could also indicate that the place probably needs work—maintenance work (and work from potential buyers to discover how costly that maintenance is likely to be). In some cases—when a home has been perfectly maintained—it could mean that some features that are expected in today’s Sapphire homes are missing. In any case, “as-is” means “heads-up.”

There is one more caution that isn’t usually written about, but which can be easy to overlook when an epic bargain looks to be within reach. Since the process of buying a house takes some time to accomplish, it’s one that often occurs before it’s too late, anyway—namely, it’s not a bargain if it’s not what you really want! It can happen that the asking price is so affordable for a home that has more (or better) features than you thought you could manage, that you are in danger of being charmed into making an offer on something that’s not a very good fit. When you discover a property that’s been reduced to bring it within your price range, it still needs to fit your family’s most important requirements. An Olympic-sized swimming pool can add an exciting and unexpected dimension, but if the place is one bedroom short, in the long run, it might not be such a bargain, after all.

This spring, many sensational offerings are out there for Sapphire home hunters. Give me a call when you are ready to take a tour of the ones that meet your requirements!

Property Hunters in Highlands Keep an Eye Out for Water

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It’s one thing when you see the word “water” figuring prominently in descriptions of Highlands properties. Any time that word comes into play, it’s a cinch that the property in question is more valuable than any waterless neighbors. Everyone knows that a shorefront or beachfront property is likely to be worth more than an identical inland place. In areas like Florida, condos with docks (or even access to a dock) are highly prized. Wherever a lake, river or stream is noted in a listing’s description, it’s likely to add significantly to the asking price—even if it’s only because of a distant view.

The conclusion anyone would draw from the foregoing is that, as a general principal, “water” is a desirable feature when it comes to real estate—and Highlands real estate would be no exception.

But that’s only for good water.

Bad water is something else again. Bad water is the kind of water you can’t do anything useful with. If it’s not there for recreation, or even for scenic enjoyment—then you are dealing with “bad” water! It includes an entire catalogue of water that is unwelcome. The only thing you can do with this kind of water is to get rid of it.

Whenever you are taking a look at property in Highlands, water should be near the top of the list of things to be watching out for (that is, if it isn’t mentioned in the listing). Later on, your property inspector will check for the wrong kind of water; but if you keep your eyes open, you can do some preliminary detective work yourself. And it does take detective work, because bad water has usually already made its getaway before you arrive. But it can’t help but leave a few clues. Here are some common ones:

Foundation clues. A single inch of rain creates 600 gallons of runoff—and if that water isn’t properly directed away from the foundation, nothing good will come of it. Piles of silt or landscaping gullies where they don’t belong are two clues.

Gutter clues. Accomplices that can cause foundation issues reveal themselves in the guise of gutters that aren’t doing their job. A visual reconnoitering of the overhead gutters and downspouts is usually sufficient to spot these perps.

Stain clues. Standing water will usually leave forensic evidence, long after it has fled the scene. Pavement, flooring, or even ceiling stains are clues; and walls can show efflorescence (the minerals left after water has evaporated).

Olfactory clues. Moisture in walls and in attic spaces can be hard to see, but easy to sniff. If it gives rise to mildew on the underside of the roof, work needs to be done!

Even if you aren’t planning to put your Highlands property on the market any time soon, getting an early preventative bead on drainage problems can ultimately become a true dollar-saver. Of course, when it’s time to sell—I hope you’ll give me a call!

Avoiding Getting Hooked on Sapphire Real Estate Technology

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You wouldn’t think that real estate technology could be as addictive as one of those games like Candy Crush or Angry Birds—but don’t tell that to Money magazine. They researched the subject in depth, and they found that two-thirds of recent home buyers said they were addicted to online listings!

Come to think of it, who hasn’t found themselves walking away from the computer, wondering what happened to the last two hours? You shouldn’t blame all that on the real estate-connected sites, because the internet has a way of pulling you away from any task by throwing distractions at you, like the latest cat hijinks video.

Don’t get me wrong: exploring today’s Sapphire real estate scene through the web can be awfully efficient. It’s just hard to deny that it’s also easy to get hooked if you succumb to the siren’s call of instantly available, constantly updated information.

Curiosity has to be the culprit. When you leave an open paper bag on the floor, any cat (not a YouTube cat; I mean a real one) will jump inside to see what’s there. The same thing happens to someone who is in the hunt for a home in Sapphire. Once they’ve seen the way the Sapphire real estate listings get updated, they have a hard time staying away, because something might have just changed. Better check! This could drive you crazy (although there are no documented cases of Sapphire home shoppers who have been institutionalized for that reason).

If you are on the lookout for the Sapphire home of your dreams, unlike what the cat experiences, every once in a while you’re rewarded. Finding a new listing that meets your search parameters does feel a little like finding the toy in a Cracker Jack box…actually, a lot better than that, because Cracker Jack toys are consistently disappointing, while new listings are at least interesting.

The easiest way to handle the addictive call of the Sapphire real estate online listings is to have me let you know as soon as a qualified property enters the scene. That’s as easy as using my site’s Contact link. That way I can keep an eye on everything for you (and often come up with some extra insights, as well).

The whole advance of real estate technology has created a much more informed buying public—and a significantly more sophisticated marketplace. In one poll, nearly half of those queried said that using technology helped them save money. As many as 92% said it saved time. In the same survey, 90% reported “an overall positive experience” (but failed to reveal if that included any cat videos).

The next time you are ready to zero in on the Sapphire home of your dreams—or find yourself checking out the latest listings with an eye toward selling—do give me a call!

Sapphire Market Values Seldom Equal their Replacement Values

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“Ideal” is a Shangri-La kind of a word. It’s not just because of its feel-good, pie-in-the-sky definition (“a standard of perfection or excellence”)—but because contained right there inside the word itself is a tacit admission. It’s only an idea—not something necessarily connected to concrete reality.

Sapphire residents don’t come across “ideal” anything very often in their daily routines, so few would be surprised to learn that even in something as important as determining the value of their Sapphire residence, the calculation turns out to be less than straightforward. The ambiguity owes to the fact that it all depends on how you look at it.

In reality, there are two quite different approaches for determining any Sapphire home’s value. Ideally, both methods would produce the same value for the same Sapphire property. That would be the Shangri-La outcome—a fine idea—but it’s seldom the case. The two methods are the Market Value approach and the Replacement Cost approach. Knowing how and why they differ explains why they yield dissimilar results.

When Sapphire homeowners examine their home insurance policies, they may find a breakdown of the replacement cost. The face amount of such a policy is meant to cover what the current cost would be to construct a similar building of equal quality—one that would have the same utility as the one that was destroyed. Such factors as materials, labor, the builder’s overhead, profit and fees are probably part of that calculation. In actuality, some of the costs that might be encountered may not be included, though: things like demolition of the old structure, debris removal, licenses and permits. It depends on the policy.

The market value is an estimate of the amount a buyer would pay in today’s market to purchase the same home in its current condition. Right off the bat, you can see that this would include the cost of the land—so you might deduce that its market value would automatically be greater than the replacement value. Ideally, that might be true. If the home were brand new. But for structures that have been in existence for a while, that might or might not hold true. For a home in less than top condition, the total might be less… likewise, if the local residential market were in a slump. On the other hand, for older homes having architectural details with fine workmanship that is expensive to duplicate today, the reverse would be true. You get the idea: given the vast number of variables that can influence the difference between market and replacement value calculations, it would be miraculous if the two ever came out the same.

When you are buying, selling—or even insuring—your Sapphire home, weighing market and replacement values is more than an abstract exercise. I’m here to help with those and many other issues that will help you determine how to make the choices that serve you best. Call me!

Top 10 Listing Phrases Might Not Attract Highlands Home Hunters

4-7-16-listingphrasesIt’s small wonder that with this spring’s selling season underway, Highlands’s house hunters can afford to be a discriminating bunch—they have the luxury of picking and choosing from a crop of truly inviting offerings. And it doesn’t hurt that today’s low mortgage interest rates have enabled more Highlands properties to fit within more family budgets.

For those of us who get to translate those home offerings into words for the Highlands listings, the job is to find phrases that draw attention to each given property’s uniquely attractive features.

But there’s another dimension that complicates things. English is a rich and powerful language, but when it comes to marketing lingo, it’s also true that these days everyone is being deluged 24/7 by vivid advertising claims. We’ve all developed callouses when it comes to the ballyhooing we get from every quarter.

Today’s house hunters have developed sales resistance. Times 10!

So what’s the answer for cooking up language that helps a property jump out from among the others? One way is to find out Highlands’s Top 10 listing phrases—and avoid overusing them! Same ‘ol, same ‘ol isn’t what works when the object is to attract Highlands prospects. True, some truly accurate descriptors can’t be totally avoided—but emphasizing them isn’t likely to fire many house hunters’ imaginations, either.

Here are a group of most frequently appearing Top 10 listing words and phrases—with some alternatives more likely to spark more attention from Highlands house hunters:

1. Beautiful (‘gorgeous’ ‘spectacular’ or ‘captivating’ bring more energy)
2. Hardwood floors (what kind of wood—and what hue?)
3. Stainless steel (at the very least, add ‘gleaming’ or ‘lustrous’)
4. Updated (‘renovated’ ‘remodeled’ ‘renewed’…or maybe even ‘reimagined’)
5. Private (this one is actually okay as-is…it may be a cliché, but it’s a desirable one!)
6. Spacious (puh-lese! How about ‘cavernous’ ‘commodious’ or ‘enormous’?)
7. Landscaped (another okay one, but in need of a boost—like ‘lusciously’ ‘stunningly’ or ‘exquisitely’)
8. Custom (‘tailor made’ ‘individualized’ ‘unique’ ‘personalized’ or ‘specially crafted’)
9. Clean (this is close to Top 10 listing phrase malpractice: if it’s clean, it’s surely also ‘spotless’ ‘flawless’ or ‘immaculate’)
10. Brand new (could be ‘state of the art’ ‘untouched’ ‘mint’ or ‘just completed’)

Even after a bit of polishing, those Top 10 listing phrases and words need to have a credibility boost via listing photography that illustrates what’s being promised. Putting the whole package together is just one part of the service you can count on when you give me a call!

Home Inspection or Offer? Which Comes First?

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A reasonable question posted recently on a real estate website can open an interesting discussion. It’s one that touches on a fundamental component of most Sapphire real estate sales.

The question was, “Can I request a home inspection before I make an offer on the home?”

The answer from the moderator was, “I can’t think of one good reason why you would do this.” The moderator should have thought a little harder! And the truth is, for any would-be Sapphire buyer who has never been involved in buying or selling a home, it’s a pretty logical question.

Take a fictional example. We have a young couple who have no previous real estate experience. Their parents never walked them through how they had gone about buying the homes they’d been raised in, and although both husband and wife have college degrees, neither has been exposed to the first thing about buying and selling a house (this is a hole in the educational setup that would seem to be pretty easy to fix…but at least for now, parents have to fill the void).

Our couple has fallen in love with an existing home. They like its size, style, and its Sapphire neighborhood—which is in a superior school district. They have some reservation about the asking price, which is a little more than their pre-determined target, but they decide to make an offer that shaves a few percentage points off the asking. They agree with their agent that for the seller to entertain their offer seriously, they need to accompany it with a 1%-2% earnest money deposit.

Just as they are on the verge of taking the leap…one other thing occurs to them. What, they wonder, will guarantee that there aren’t serious mechanical or other difficulties with the house? The solution would be simple—just order an inspection—except that, not yet being in a contract, the $300 – $600 inspection fee could be a waste of money. What if the sellers accept an offer in between the time the young couple orders the inspection and submits their offer?

In practice, a “before offer” inspection IS done in some cases – usually when a multiple offer situation is expected. In such cases, multiple sets of buyers would probably be advised by their savvy agents to invest the money on the front end to increase their odds of writing the offer that will be accepted. The way savvy agents help their seller clients avoid this problem for buyers is to have the sellers order a home inspection report themselves—and make it available to any potential buyers for review. This helps the sellers to get ahead of any unknown issues that might come up, as well as encouraging offers. When buyers have information about the basic condition of the home, it frees them to write an offer with more confidence.

A sound offer triggers the start of a process that ends in handshakes and smiles all around—and the transfer of a very valuable set of keys.

Whether buying or selling, strategic guidance regarding the offer is just one contribution of your chosen Sapphire real estate agent—and another reason why teaming with the right one is so key to getting the result you are looking for. I hope you’ll give me a call to discuss how I will help you reach those goals!

Highlands Luxury Real Estate Escapes April Fool’s Day Worries

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It looked like another chuckle-worthy April Fool’s Day dispatch: CNBC’s webcast “Is NYC luxury real estate about to go bust?” It was barely 7 in the morning on April 1—but only the most bleary-eyed Highlands web watchers were likely to have been caught off-guard.

Pranksters had already made mincemeat of the credibility Friday news dispatches normally deserve. Web parodists had started early (against all common decency, the day before). Late on Thursday, Gizmodo had announced the sale of the “Moon Watch”—its $27,500 price tag justified by a housing made from genuine moon rock brought back to earth by the Soviet’s 1974 Luna probe. Sure.

Even before the sun came up, Google Express made its first sky-enabled delivery. Not by drone: the first delivery was an axe, dropped by parachute.

Duolongo advertised a miraculous new product—a pillow that uses Morse code to teach you a language while you sleep (“I went to bed speaking only English, but woke up bilingual. Buenos dias a todos!”).

So CNBC’s projection of doomsday for Manhattan luxury real estate—for April-Fools-wary Highlands readers, at least—would not have been taken very seriously. The problem was, it actually was authentic. Sort of.

The webcast was a segment lifted from the CNBC Squawkbox show, presumably aired that morning. The blurb promised, “CNBC’s Robert Frank takes the wraps off a new report that shows the luxury real estate market in NYC is about to crumble.” And it did have a promising setup for what (to anyone living outside The City, possibly including a few Highlands residents) might take to be breathtakingly unsustainable price levels. Some of the new records posted:

Average apartment sales prices top $2 million (for the first time)
Price Per Sq/Foot = $1,713
Number of sales = 2,877 (a jump of 8%)

But…so where is the promised luxury real estate “bust”? It didn’t seem readily at hand—especially after we were shown a 5-bedroom Central Park coop. It had been bought in 2003 for a pittance ($12 million). Now it had sold quickly. By regular Highlands standards, at least, that didn’t seem to evidence much luxury real estate crumbling, since the selling price had been $35 million. Frank explained that the owners had done “some renovating”—so we were momentarily left wondering if the crumbling was because they’d had to go to so much trouble…

No! The reason put forth was that many of the record sales resulted from contracts signed as much as 18 months earlier. So maybe it was possible that these high prices and sales volumes might not be sustainable. There was no evidence beyond nervousness about China and the stock market tumble (which had just reversed, oddly enough).

That the report on NYC luxury real estate was not an April Fool’s joke was a sort of April Fool’s joke in itself. Here in Highlands, those kinds of worries were less widespread. China seemed a bit remote—and the stock market had already come roaring back—but neither seemed to be key to Town’s luxury real estate. If you would like some authentically real-world market info, do give me a call!

3 Benchmarks for Sapphire Real Estate Agent Dowsing

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Whenever a buyer or seller is set to enter the market, they find themselves faced with the task of identifying the Sapphire real estate agent who will serve them best. There are many of us to choose from—and not a lot guidance on how to proceed.

Maybe there should be something like a Real Estate Agent Dowser. You remember dowsers—the folks who divine where to drill for ground water. Most do it by walking around, holding a dowsing rod (usually Y-shaped). When it shivers or points down, BINGO! That’s where the water is. Pay the fee and call the drilling company. Now, it’s said that there is absolutely no scientific evidence that dowsing works. Yet there are plenty of folks who live out in the country who will tell you that, of course it’s hard to believe, but still… That’s why dowsing is a real occupation. Just ask any one of the American Society of Dowsers’ 3,000 members…

Here in Sapphire, when you set out to find a real estate agent to help with buying or selling a home, there is no American Society of Real Estate Agent Dowsers to help. Fortunately, Sapphire’s real estate agents aren’t as hard to find as underground water pockets—but even so, detecting which of us is best suited to be your partner is no “gimme.”

One good solution is to interview the candidates with an eye toward finding out how they stack up against three practical benchmarks:

Selling Skill. A great real estate agent is a great salesperson—easy to talk to, sympathetic to your needs—genuinely likeable. When you are interviewing potential agents, offer an objection or two to test how seamlessly the conversation proceeds. The most valuable sales representatives are those who can adapt to resistance without batting an eye, or letting negativity prevail.
Current knowledge and experience. Being able to provide accurate and fact-based market information and analysis is an important indicator— as is having successfully performed in a variety of Sapphire real estate transactions.
Negotiation Skill. When all else points to a good fit, discuss the terms that candidate proposes between you. Your chosen real estate agent will be negotiating on your behalf—so your agent’s ability to present hard business matters in a relaxed and amenable way will serve you well.

When you become your own real estate agent dowser, you won’t need a witch hazel stick to point the way. A few thoughtful interviews will do the trick—and I hope you’ll be sure to give me a call as soon as you go dowsing!

Notes on the Ins and Outs of Highlands Short Sale Listings

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Any dedicated bargain hunter who scours the Highlands listings is not surprised to find among the most deeply discounted entries one of two notations: foreclosure or short sale.

Everyone knows what the “foreclosure” designation means—it’s been repossessed by the bank. It’s an REO (real estate owned). By discounting the asking price, the lending entity invites buyers to take the property off its books. It is here that the economists’ favorite acronym, “TANSTAAFL” (There Ain’t No Such Thing As A Free Lunch), comes into play. Foreclosed properties have frequently been neglected by their previous owners, who are not happy campers. So the cost of rehabilitation must be factored in before any offer is made. Still, foreclosures can represent real opportunities for buyers with patience and determination.

Slightly different are foreclosures’ first cousins: Highlands’s short sale listings. There are any number of unforeseen circumstances that can cause an owner to fall into financial distress, but when their home has to be repossessed, the impact on the borrower’s credit is immediate and drastic. It can make finding a new place to live difficult, and can even make future employers hesitate to hire someone whose record includes that kind of hefty unpaid debt.

Highlands properties which fall in the “short sale” category are those in which the borrower has been unable to keep up with the mortgage payments, but who is arranging for the lender to agree to accept a payoff that’s less than the full amount owed. When a short sale is finalized, the result is still some damage to the original borrower’s credit, but less than had a foreclosure proceeded. The buyer will benefit from what should be a substantially lower price than a comparable Highlands property would bring—and a home that is usually in better condition. An eager lender can also sometimes offer favorable financing terms, too.

But remembering what the economists say about TANSTAAFL, there are also these points to keep in mind:

Short sales involve extra bureaucratic red tape. The fine print includes items such as the lender having to approve details of the sale—and that can result in nerve-racking delays.
Although the owner is usually trying to keep a short sale property in good shape to facilitate the deal, banks won’t allow a short sale until the borrower has seriously fallen behind in payments. That can mean an inability to keep up with the expense of proper maintenance. As in a foreclosure, canny short sale buyers make certain they know the cost of rehabilitation.
The possibility of sticky legal issues needs to be recognized. For instance, if the seller has filed for bankruptcy, it could squelch the whole deal. Negotiating a short sale can be considered a “collection activity”—and those aren’t allowed in most bankruptcy courts.

If one of Highlands’s foreclosure or short sale-denoted listings has grabbed your attention, I can help. It will require attending to some technical issues attached to the specific property—but I’ll be pleased to help you navigate the process from beginning to end!