Helping our Seniors

I have heard some recent accounts of tough times in real estate when dealing with senior clients. Anybody who knows me, knows I have a soft spot for seniors because they are often the forgotten members of society; so it bothers me when I hear about these things happening. Like this: One very elderly lady gets to within days of closing and decides she doesn’t want to sell. She doesn’t want to sell because she never really wanted to in the first place, and besides, all attorneys are in cahoots with each other: She wants to keep her house. And, she doesn’t begin to understand the consequences of such a decision, nor even how she got to this point, really. Heartbreaking.

The key is patience. Patience and covering the same ground over and over…and OVER if that’s what it takes…until everyone truly understands not only the process, but HOW the process works. Remember many of these people, our seniors, don’t understand how real estate works ‘these days’. In their minds, they may envision Mayberry, where everyone knows everyone; or they may think the barber and the attorney are best buds. By the time many of the true seniors get to the point of selling the ‘family home’, they may very well have lost touch with the modern fast-paced reality. If you are going to represent them, you are going to have to assess the level of understanding of your client first; and if you can’t walk them through it, beware.

Remember that seniors need to net a certain amount, usually, and that’s a great discussion to have; but you may have to have it several times to make it understood; in other words, whether or not you can make that happen. And remember that these folks may not know how the attorney works, or even why one is involved. Think about how much real estate has changed in your lifetime, and then imagine being 85 and trying to grasp it. And remember that a seller may think the BUYER’S closing attorney is also her/his attorney. Explain it! Take the time, because I have found that there’s a lot of fear in the hearts of many seniors, and I have found that they truly appreciate it when you take the time to let them know they are being CARED for. That’s what I do, and I mean it. It’s just what we owe them.

A Quick Note for Real Estate Agents

Hi fellow servants. I just wanted to send a quick note about technology. I get all KINDS of responses to it, and the only ones that bother me are the staunchly resistant ones. I’m lucky. I’m over 60, but I ‘grew up’ when technology was getting wings, and I have something of an aptitude for it. So I’ve been a fan from the start, and I’m a nerd, which makes me crave the newest cool stuff. I think some of it is much ado about nothing, and I can usually tell when a program or gadget is going to be a one and done. And I can usually tell when someone took an existing popular program or app and tweaked it to make it seem new and ‘cool’. So I don’t have to have every SINGLE app that comes along, and I don’t need to post pictures of my food. So there you go.

But for the OTHER things, the ones that make our lives SO much easier and better, those…I love. And I put in the effort to learn how to use them so that I have at least a fairly proficient use of them. That’s one secret: Time. The other secret is teamwork. I GUARANTEE that your fellow agents will help you when you get stuck. At my office, if anyone needs help with ANYTHING, there are many hands reaching out to offer assistance. If you don’t have that…well, come to my office. You’ll be amazed.

For real estate, it is ESSENTIAL that you stay IN the mainstream of technological advances. None of them are rocket science, and I keep telling people: “You can’t break the earth if you make a mistake”. Because…you can always fix mistakes, either by re-doing the effort, or by filling out, you guessed it, a FORM. But I digress. Keep trying. Take a deep breath and remember that you are a human with a high functioning control mechanism (brain), and you can do this. And besides, I really hate it when I get a PICTURE of a document in dark gray…impossible to read. Come on.

YA GOTTA LEARN THE PROGRAMS, PEOPLE. Look, we are in this together, and while we are often on opposite sides of the table, we are in the same business. We can either go through it in abject pain and suffering, or we can all be paddling the tech boat in the same direction. I know time is precious in our world, but I also know that every one of us has time to sit down and learn one or two things a week, or a day…however you want to do it…to learn that new database or website you have to use. Again, none of this is rocket science. You can do it.

If you are going to use an electronic lockbox, for example, make SURE your smart phone has a high level of charge, because it has to talk to the lockbox, and if you are under 30% charge? Forget it. You’re going to have problems. And if you are in a low signal area, first of all there should not be an electronic box on that property because it won’t work right (the listing agent should have known that and acted accordingly). And listen, if the majority of the world is using electronic lock boxes, you NEED TO LEARN how to use them, and yes, you need to download that app on your phone. Why? Because it makes. your. life. SO. much. better! And??? It is EASY. Another reason? The listing agent shouldn’t have to teach you how to use the tools of your trade. My blood pressure shoots to the moon when I get an accusatory call that “your lockbox doesn’t work”. OMG. YES IT DOES. It does. I have driven many many miles to listings to check out my lockboxes and guess what? THEY WORK! And they provide a great service to sellers because each person who accesses it is ON RECORD. That’s essential in today’s world.

Wire transfers. Things are changing. You have to get on board with the new direction things are going with regard to funding real estate. And do you know, I have clients who do not have a checking account? Right! Providing directions for tracking electronic due diligence and earnest money transfers is coming. That’s technology. And it is necessary. The old ways of doing things are fading away; even ‘normal’ banks are fading. It’s true! How banking is done is being tweaked as we speak. Better learn to love technology, or at least not scream in fear of it. You HAVE to do this stuff.

Here’s something else to think about. If you are a buyer agent and you don’t have the electronic lockbox app, you will have have to get a one-day code to access the property. You probably should call the listing agent for that, because sometimes the showing services get it wrong and cause a lot of anxiety for buyer agents trying to show property. So, listing agents, learn how to get a one day code for your buyer agents! You should know how to do that if you are going to put an electronic box on the property. You don’t want them to get frustrated and walk away from your listing in anger. Not a good thing.

I know some folks who are absolutely terrified of new programs and apps and processes. I don’t really understand that, but I do try to help those folks navigate through, because each time they make it through without being struck by lightning, they feel a bit braver about using ‘it’, whatever ‘it’ is. But folks, if you are afraid, if you’re one of them, please try to learn. Try to stem the panic, calm down enough to remember WHAT you have just done, and WHY you did it. Knowing the ‘why’ piece makes learning the ‘what’ a lot easier, in my experience.

If you were in the corporate world and the new way of doing things was implemented, you WOULD get on board. These new real estate tools are no different. They are here because they add value to the process, they provide another level of protection for our clients, and they ease the process for all of us. So dive in. You can’t break the earth. Trust me. If it could have been done, I’d have done it by now! You should have seen me in the science world…right Phil?

And one more thing before I go: NOT answering your calls is NOT being technologically advanced. It’s resisting actually speaking to another agent in a business where we NEED to actually speak to one another. I know, don’t hyperventilate. ANSWER. YOUR. PHONE. If you do not, you are adding another UNNECESSARY step in the process, and you know….TIME IS PRECIOUS. Don’t ask me to text you. If I WANT to text, I will text.

Answer. Your. Phone.

Okay, I’m finished now.

Buying a Cheap House

If you are a contractor or investor with lots of cash, just find it and buy it. You can find them for under 100K around here. Godspeed and all that.

If you are a first time buyer, or an ordinary, first time move-up buyer with one home you live in and a little bit of savings, forget it. It does NOT go the way you think it goes. Just doesn’t. Trust me. You won’t, but I am right.

If you are going to try to buy through an internet provider, just know that there are going to be costs. Like…1.95% ‘up front fee’, for example. That’s cash, up front, and you still have to get loan approval. Most cheap houses? NOBODY will lend on them. NO-BOD-Y.

If you want to go it on your own, you had better know how to find out what the REAL cost will be. Or get out the crying towel. These days in real estate, there are usually up front ‘money on the table’ outlays of cash, some of which are not refundable. Just call a realtor. And don’t call one to USE one, call one to compensate them for the help they will give you. I’m tired of hearing horror stories of people losing thousands because they didn’t know or wouldn’t listen. Really! It really bothers me when I hear this stuff, but on the other hand, if they have been advised well and they continue to blunder, well…that’s on them.

Want to just buy a piece of land and build…because land is 20K an acre? Just know that you can’t finance that land. You’re going to have to pay cash for it, even if you family member is “standing by” to build a house on it for you. And dare I say this? Your family member is not going to make you the priority if he’s doing the build on a discounted basis (or has a job he has to go to every day). And if you didn’t have that kind of cash to get you into a home the traditional way, how are you going to get it to pay cash for land?

Oh, I know. Buy a foreclosure house! NOT! If you find a cheap foreclosure house, trust me, the repairs will be astronomical. And you don’t have discretionary funds, remember? Oh, and this is important. You can’t finance it. Ya gotta pay cash. And, you know those seller disclosures you get with homes listed in multiple services? The ones that tell you what’s wrong with the house? Not gonna get one with a foreclosure, and if you DO, all of the boxes will be checked with ‘no representation’. That means: I don’t know and/or I don’t care. So you won’t know whether the foundation has major issues, the structure is termite ridden, half of the structure was not permitted, the septic system is collapsing, the well is contaminated…you know, those little details.

So you get to spend a LOT more money on inspections than you might otherwise spend, only to decide you don’t want the house. I call that a colossal waste of money! UNLESS you are a contractor or investor, flush with cash.

Want a fixer-upper? Great! You’d better like DIY home improvement projects, because you’ll be living in one for years! Now, I have clients who do love DIY and are good at it, and have the patience and love of restoration to enjoy the long term, patience-sapping experience. Not many people do. So. If you go this route, plan ahead. Know that if you run out of patience and money, you’ll have a heck of a time selling a partially restored fixer-upper. And depending on the nature of the ‘fixing’, you may have to wait for a cash buyer to show up. By the way, I can spend five minutes with you and know whether or not you can handle it. Yes, I’m that good.

See, this stuff is important! Real estate agents…the good ones…can walk you through the processes so that you don’t trip over your own feet, even if you ARE looking for a cheap house. And please please please remember, you are hiring an agent for her/his expertise. That’s what you’re paying for. So don’t let non-Realtor people yap into your head and ruin your deal. This happens so often that when I hear about a family member being involved, if that person is not willing to meet with me and talk it out with me? I don’t want the transaction. Why? Because they NEVER make it through to closing when the family member wants to be a behind-the-scenes puppet master. Usually they do not understand the process and don’t want that to become obvious to the professional.

I have done many transactions where I DID meet with family and talk things through. What’s the first job? Make sure everyone is on the same page. Listen, if you and your family member are at odds, stay out of the market until you reach consensus. Real estate agents do not get paid until the property closes. That means if you argue and tug back and forth with family throughout the transaction, not only does the real estate agent have to sit down and wait for you to get bad advice from a non-agent, but we also lose the deal and get NOTHING for our time. I know you like to be paid when you work, so please, remember that our time ALSO has value. So, bring your family to me first. Then I get to decide if the deal has a snowball’s chance….you get the idea. I love nothing more than a tight, loving family, working together. But one behind the scenes giving bad advice? No.

I have helped buyers purchase low priced homes many times. Some are investments; some are homes to be brought back to life to be loved and lived in. I love these transactions, because I hate to see homes fall into disrepair and be destroyed. But you have to know that there is a way to approach and close these purchases and a way to completely blow the deal.

Which would you rather do?

Predicting the Market

Holidays.  You love them, you dread them, you never know what you’re gonna get.  It’s like that in real estate markets, too.  I can predict with some level of accuracy what the market will look like in the last quarter and into the first quarter…from the 10,000 foot view.  I normally have a Thanksgiving and a Christmas closing…not ON those days, but close.  And I usually have closing or two in January.  Some real estate agents will say that people don’t buy houses during holiday season. Well, my clients do. Usually.  But I’m neither a mind reader nor a market psychic.  You just can’t predict accurately all the time.

This year I have multiple deals in the works for year end, more than ever, in fact.  So I figure that my normally SLOW months of February and March might be flat.  But then again… mayyyyybe not.  I have some pipeline business that will likely take me into the first quarter at a reasonable clip.  Could all of the buyers decide not to buy?  Yep.  They could.  Can’t predict.

What I’m trying to say here is that nobody can predict buyer behavior.  Right now, my listings have gone quiet, suddenly and inexplicably, which means buyers are ‘on a break’.  I blame it on Halloween, which is apparently a much bigger holiday than I gave it credit for being.  I don’t get it, but if I don’t blame crickets chirping on Halloween, I have to go to the spacecraft sprinkling anti-home shopping dust on the area, and frankly, I like the space ship idea even better.

It’s funny how this stuff works.  People can be maypole dancing around listings in the entire area, and then suddenly…crickets chirping.  So, if you have your home on the market, just know that these things happen, they come up and they go away.  And your home will sell.  Can I tell you when?

Nope. Wish I could.

For First Time Buyers: A Word of Advice

I am a real estate agent in the Raleigh area market, where we are in a terrible housing shortage, particularly in the first time buyer price point.  Here, many of our first timers use USDA funding in order to get 100% financing, and most of them don’t have enough discretionary money to cover all of their closing costs (some can’t cover ANY).  Often this is because they’ve just finished paying off student loans and can finally, barely qualify to buy a home of their own and get out of the rental racket.

Today, for every home under 150K that pops onto the market, there are about 8 offers on the table in a matter of hours.  First time buyers are offering at LEAST $5000 dollars above list price in order to have a remote chance at having their offer accepted and I’m guessing many of these folks will be disappointed by a low appraised value, potentially after they have spent a lot of money on inspections.  Bad idea.

What this means is:  1) The home is most likely NOT going to “appraise” at that list-price-plus-closing-cost price, because homes are ALREADY priced at the high end of the range due to demand.  2)  If the home does not appraise, then young buyer must bring to closing the difference between appraised value and offer price, or walk away and lose the hard earned due diligence money they put on the table with the offer.  First time buyers looking for sellers to ‘pay their closing costs’ cannot AFFORD to lose that due diligence money and forget about having them bring the difference to closing.  And by the way, sellers are taking FULL advantage of the situation by asking for HUGE due diligence amounts from people barely able to get into the market in the first place.  They do this because the likelihood of an over-list-price home appraising at the higher value is LOW; so the seller stands to be able to pocket whatever amount of due diligence money the potential buyer put forth.

First time buyers, please listen carefully.  If you offer above appraisal value and it actually works, you go into your first home “upside down”.  What you WANT is to walk in with some equity, and in this market that’s hard to pull off; but going in under water is just a bad idea.

So please consider this:  SAVE money to pay your closing costs, or at least SOME of them,  yourself.  That way, you can offer full list price and ask for ZERO closing cost assistance from the seller.  OR…ask for a monetary gift from a family member (with a letter stating such). You might just have a chance at having your offer accepted in that circumstance, and you won’t be upside down when you close.  Talk with your lender about what you have to do in order to accept a gift and make sure that’s allowed by your loan type, but it’s usually an option for you.

Listen, if you have to finance in your closing costs, you are advertising to a seller, who already has a pile of offers on the table, that you can’t afford the house, or that you have no skin in the game.  Either or both of those advertisements will get your offer rejected in record time.  Sellers want to know that you have invested enough to stick around through the whole process, because if you walk away, that seller has lost VALUABLE marketing time.  Sellers don’t like losing hot market time, with perfectly good reason.  If they view you as cash-poor, that makes you a bad risk in their minds.  In this market, sellers don’t NEED to accept a bad risk. There are too many good ones on the table.

This market is NOT the one where you can expect the sellers to fund your way into a house.  YOU have to contribute.  If you cannot, your best bet is a new home from a builder.  Builders have deep pockets and usually offer some closing cost assistance, although it’s minimal in the under-150K price point.  In short: you need money to buy a house.  Remember you may have to pay for inspections, and that can add up pretty fast if you do home, HVAC, roof,septic, well and crawl space inspections and a survey.

I love working with first time buyers, but if I always, always have to be the one to tell you that won’t work, you can’t do that, your offer was rejected, etc…then I end up being the bad guy and I’m not a bad guy.  This is just a twisted, crazy market, and your only viable option is to understand the market and play by its rules.

I once had a builder tell me he was just going to “ignore the market” and keep selling.  That was when the market was crashing.  Want to make a guess how that turned out?  It was a disaster, of course!  You cannot just ignore reality; you MUST operate within it.

So…know what you face going in, prepare monetarily, and prepare with patience.  You may submit several offers before yours gets accepted.  Meanwhile, SAVE SAVE SAVE!  I wish you the very best of luck and I’m proud of you for getting to the point where you can buy your first home!  Let’s get together, talk things through, and get you prepared for this crazy market.

Contingency Offers: Get with the Program!

The need for sellers to accept contingency offers is quickly becoming a frustrating issue in the Triangle. Because sellers usually need to find a home to buy, and because of the growing shortage of houses for them TO buy, we’re facing a new, huge challenge. Buyers know how hard it is to find a home to buy in general, but SELLERS cannot compete with buyers who do not have a contingency, once their home is under contract. But think about this: If sellers know they have a double challenge (selling their home and finding one to move to) AND they know agents will not advocate for them in presenting (and getting accepted) contingency offers, then we can expect a big drop in listings. There you have it: My prediction. With the existing shortage of housing, if people stop listing, we’re in for a terrible situation. Agents need to become familiar with contingency offers and stop viewing them as bad. If a seller needs to make a contingency offer in order to have a shot at a place to move TO when they sell, then this puts the owner of the DESIRED home in an even stronger selling position. They can ask for full list price, high due diligence, and pretty much anything else they want, just for accepting a contingency offer. They might have to make one more house payment than planned, but they can also get that payment in due diligence if they play their cards right. Contingency offers are not the devil and they are growing…GROWING…in popularity and need. But both agents need to be able to have a frank discussion about the likelihood of two successful transactions and work towards facilitating a win-win situation. I remember writing blog entries, appealing to buyers to be sensible about their position of power during the market crash. So many buyers lost perspective and put sellers in heart wrenching positions because they had the upper hand. I hope our sellers now, when it’s their turn to hold all the cards, will keep their perspective as well. And agents, think about these contingency offers. They may work to your sellers’ advantage, if you negotiate well.

State of the Housing Market in the Triangle

Hi everyone!  I thought I’d touch base and talk a little bit about the housing market in the Raleigh NC area.  We are experiencing a hot market here, and also a housing shortage.  Anyone who lived through the crash as a realtor or builder, predicted this situation, because so many builders went out of business and because so many “cheap” homes were bought as either rentals or primary residences as the market righted itself.  NOW, however, we are experiencing the slinky effect.  There simply are not enough houses to satisfy demand here.

We lost a lot of builders and developers in the crash, and I assume many never came back, although many did.  I see many of the same names pounding out spec homes and custom builds, but they can’t keep up with demand. Interest rates have been at historic lows, fueling the feeding frenzy, and now, there are not enough existing homes either.  Baby Boomers are asking for one-level living, and requests for senior living communities are raging.  This situation could also have been predicted, although you wouldn’t think so by the scramble to supply this need.

I drove around some of the older communities and knocked on doors, encouraging people who owned older ranch-style homes to list with me, because not only could I sell their house in the blink of an eye, but also,they could buy a home at a very low interest rate.  Problem is, now there AREN’T any homes for them to move to if they do sell their ranch style home if they want to be under 200 thousand.

So we’re in a bit of a pickle.  Trying to find a home under 200 thousand that’s within a reasonable commute distance is next to impossible, although there are some town homes coming on line under 160 thousand that will not force a huge commute to work. Problem is: Townhouse are two story. Baby boomers want one story.

So.  We talk money.  Because of the supply/demand discord, prices are jumping.  It’s easy for me to list at the top of the price range indicated by a market analysis, and often get at or above list price offers!  This is great for sellers, and kind of a balancing of the universe; because these folks took a beating in the crash.  Senior communities are popping up all around, just getting off the ground really, but they are priced so high that many of my clients who might want that kind of home laugh and go another direction.  People moving to a fixed income  lifestyle often can’t easily afford a starting price in the 400’s.  I do hear that DR Horton is starting an over 55 community in this area priced under 200.  Now we’re talking.

So it’s as hot, crazy market.  If you are thinking of selling, call me.  We should start by talking about what you want to go TO, and makes sure we can find it for you.  Because if we list your home, chances are it’ll fly off the market faster than you may want it to!  But it’ll fly at a higher price than you might think too!

 

Statistics on Home Sales

Articles on home sales fill the internet lately, and most people cite those statistics without doing a deeper dive, or having the background information to interpret the data.  But it is imperative that you know where the numbers come from that influence your decisions related to buying a home, or selling your existing home, or both.  And it is important that you understand your market well enough to truly understand what the data is telling you, or whether it even applies.

I just read a article that said existing home sales are down 2.6%.  For many, that would be the end of the story.  But in my market, if existing home sales are down at all, it is definitely not due to the economy; it is because there is a shortage of listings.  In other words, MANY realtors have clients standing in line to buy existing homes, but there just aren’t any available to buy in their price point.  IMPORTANT: If you are thinking of selling YOUR existing home, this is GREAT news for you!  Supply is low and demand is VERY high.  This means many thousands more dollars in your pocket!  So in this case a 2.6% drop is not bad news. In fact, it’s a reason to celebrate.  And that is in the Raleigh/Triangle market, not in Chattanooga.

Something else to consider is seasonal effect on data.  Most folks don’t want to have their home on the market for sale during November and December, because of the holidays.  And during summer vacation time, it’s not unusual to see a slow down in buying activity.  It doesn’t predict gloom and doom for the market; rather, data predict typical human habits and traditions.  I always have homes closing over both Thanksgiving and Christmas, so some folks clearly take advantage of the lower supply of homes and they list, or they take advantage of the holiday slowdown to take advantage of buying at potentially a lower price.  See how this works?  Make the data work in your favor by understanding it.

The other thing you need to dig out of these articles is the source of the data.  I just looked at a chart showing lowest time on the market for existing homes.  I know our time on the market here is much lower, on average, than what the chart showed.  So I found the small print and saw that the data came from San Francisco CA, Billings MT, Chattanooga TN.  This data had NOTHING to do with our local market.  So be sure you know where these “stats” come from.  In fact, in some neighborhoods, I can almost predict when a home will go under contract, based on that community’s time on the market.  In the last case I examined, time on the market was about 40 days, lower than that chart indicated from these other areas.

The bottom line is this, and you’ve heard it a thousand times: Real estate is local.  Now that sounds a bit ridiculous, right?  But the saying is packed with truth.  What happens in San Francisco has nothing to do with us, here in the Raleigh/Triangle market.  Each day we have 60+ people moving here, needing homes.  EACH DAY.  So our market is always healthy, or healthier, than markets anywhere else in the US.  This means if the economy crashes, we will slow down, but not as much as most other markets in the whole country.  So don’t be afraid to buy, and I will beg:  Please list your existing home.  I can sell it!  I probably have a buyer waiting.

And another thing…

Life is never dull, particularly if you engage and pay attention.  You see good and bad everywhere and you see things that make you go hmmmm….or make blood spurt out of your ears.

Like the other day:  I was having a conversation with a mortgage banker branch manager, who talked about how, sometimes, people don’t want him to earn a living.  Really?  Well he didn’t say it like THAT.  But I understood.  People want bankers and realtors to work for nothing.  They think we are cheating snakes out to drain their wallets.  That we need to pay our bills matters not, and that our time and training makes us valuable experts and worthy of an income…matters naught.  When you need an expert and don’t want to pay them for expertise…makes my head explode.

We have taken HUNDREDS of hours of classes…and paid for them…, we are licensed by the state, we are held to strict legal and ethical standards, and we stand between YOU and LAWSUITS, every…single…day.  What do you think it’s worth to be protected from lawsuits and guided through the minefield of home purchase or sale?  Well it’s not free.  You wouldn’t work for nothing and you should not expect your real estate agent to either.

I don’t know of an other profession where earning a living is so resented.  First of all real estate agents do not get 6% of your gross sale price. Please read that again.  THE AGENCY gets that, or whatever rate is negotiated, and the AGENT gets a little sliver of that amount. I’m working a really nice deal right now, quarter of a million dollar sale.  Know what I will make?  About ten bucks an hour.  You try to pay your bills on that kind of salary!  Oh and by the way? I worked JUST as hard on this transaction as I do on all the rest!  That’s what we do.

Please read this carefully.  IF YOU ARE A SELLER, YOU PAY BOTH COMMISSIONS; YOU PAY THE BUY SIDE AND YOU PAY THE LIST SIDE.  But when you BUY, YOU PAY NOTHING.  And again, you are NOT PAYING THE AGENT; you are paying the agency, who market your home, manage the transaction, coordinate the closing, manage the cash flow, keep things on track so nobody gets SUED.  These things are done by people who work very hard for YOU and who deserve to EARN A LIVING…just…like…you.  And then there’s the closing attorney who is never asked for a discount.  hmmmm….

So let’s go back to the ‘sliver’ of pay.  Now, if there is a REFERRAL fee, MY part of the deal gets cut.  If I give YOU a discount on your listing commission, MY fee gets cut.  In other words you are asking me to put my household budget at risk, while I am at your beck and call 24/7.  Do you work 24/7 at your job, and if you DID, what would you expect to get paid?  More than 1o bucks an hour, I am sure.  And…will you please put your household budget at risk for me?  Just this once?  No?  Well I’m shocked.  Please don’t ask me to do that for you.

Real estate agents have to pay HUNDREDS of dollars a year just to BE agents, and then we pay for marketing, gas, wear and tear on our cars, we wear out our tires and we’re out driving you around in ice and snow,  floods, rain and hail.  And if we are not driving YOU around we’re driving OURSELVES somewhere to deliver something for you or on your behalf!  Where did everyone get the idea that we just let you look at a house and then we go eat bonbons?  I get calls at 11 pm sometimes.  I rarely eat dinner without being called away for a text, phone call or email.  Sometimes I don’t even bother to sit down to eat and I’m so busy I can’t remember what I ate.  I don’t take vacations and if I DO get away at all, I work throughout.  24/7.  For you.  Do you work on your vacations?  I bet not. I even worked during my mother’s funeral days.  24.7.

I ROUTINELY have people who know the listing fee and then ask me to give them a discount.  Answer this: When you go to your job, does ANYBODY ask you to work for less pay today?  Just this once?  Just for me?  NO!  And if they did you might deck them.  But we get asked that question…every day!!  If you hire a divorce lawyer do you ask him to give you a discount?  No! Do you ask your pastor to work for nothing but be at your beck and call 24/7?  Nope.  Do you ask your surgeon to give you just a little break on his fee?  NO!  Do you ask the checkout person at the grocery store to work for less pay just for you? No!  So….why do you do that to us?

Here’s a good one.  Do you call a realtor to drive you around the world looking at houses, taking up our time, running out our gas, keeping us from actually making a living, and then go behind us and try to buy directly from the seller?  JUST TO SAVE A FEE THAT YOU DO NOT PAY ANYWAY?  Listen.  If you do that, the seller wins, not you.  Because, the seller does not have to tell you that the house has leaking polybutylene pipes in ALL OF THE WALLS.  The seller does not have to disclose that the cute addition was not permitted and has substandard wiring that could burn the house down around your ears.  The seller does not have to reveal that the septic system has collapsed and the cost to fix it is ten grand or more.  So you save …uh…NOTHING…but you end up buying tens of thousands of dollars worth of problems that you will have to repair before YOU can sell, or even before you can enjoy living in the house.  If you do that, you are screwed.  You have NO legal recourse, and you saved the SELLER thousands and thousands and thousands of dollars.  And that’s the person who just screwed you!  But you think you got one over on the real estate agent.  Well, the only one you hurt is that guy you see when you look in the mirror!  Which, by the way….is the realtors’ revenge.

And by the way, the only way you can get out from under that nightmare is to BE the dishonest seller who screwed you.  Then you screw another uninformed buyer who thinks he is getting one over on the real estate agent.  Do you want to be that guy?  Yeah, probably.  If you went that route initially you probably do.  And you would remove the head of anyone who tried to tell you that you don’t deserve to be paid for YOUR job.  Amazing.

The bottom line is that in these cases it is not the real estate agents who are greedy.  If you get my DRIFT. I don’t know anybody who works harder than realtors for less pay and less appreciation. Why do we do it?  For the ones who are wonderful people that we are incredibly glad we met and whom we were honored to serve.

And one more thing:  I helped a couple look for a townhouse when they wanted to downsize and sell their house.  There just wasn’t anything on the market in their price range that was as nice as what they had, so they decided not to sell.  I was relieved they made that decision because there just wasn’t anything on the market that would be right for them.  I had spent days with them and other hours on their behalf that they didn’t know about.  Know what they did?  They paid me for my time.  I was shocked and amazed.  And grateful, I might add, that fairness does still exist.

And I was reminded that there are good folks out there who don’t begrudge anyone who works hard, the right to earn a living.

Interest Rates on the Rise, BUT…

It should come as no surprise that interest rates are on the rise.  This means that a house payment you could afford six months ago might be out of your range now.  It’s still a great time to buy a home, though, because rates are still at record lows.  I’ve had some conversations lately that made me remember that the interest rate when I bought my first home was around 17%.  I know.

My professional advice is to visit your preferred lender IN PERSON, and have a conversation about the different kinds of loans out there, and get several estimates, based on increasing rates.  Understand that there are MANY different types of loans, including, yes, adjustable rate ones.  My first mortgage was an adjustable rate loan, but my rate was frozen for four years, and could only adjust upward one percent per adjustment period afterward.  Good.  At that time rates were SURE to go down anyway, but before the adjustment, I refinanced to a conventional loan with a fixed rate.  And just so you know, there were a plethora of adjustable rate choices at that time.  I’ve used a balloon loan too.  Low fixed rate up front for a period, after which the entire amount comes due.  But you just FINANCE that amount, and the risk, of course, is what the rates will be at that time.  In my cases, they always went down, which was a calculate risk on my part.

If you’re not comfortable with risk, then these adjustable rates or balloon loans are not for you.  But the point is that there are other ways to calculate your payment than just a straight, 30 year, conventional loan.  So take a couple of hours and visit a loan officer.  You’ll be amazed at what’s out there.

Adjustable rate mortgages got a bad reputation in the aftermath of the real estate market crash…which should be called the Wall Street Greed crash…because lenders were writing loans that never should have seen the light of day and would land somebody in jail today.  Note that they did that, often, at the behest of Wall Street brokers who needed sub-prime loans to fill tranches blah blah blah.   HOWEVER…not all adjustables are bad.  If you are responsible and do your homework, an adjustable rate mortgage can be a way to beat the rising rates for the short term.  But you will need to be in a good financial position to refinance when the time comes.

Bottom line is this:  In our market here in the Triangle, every seller expects a loan approval letter (some a pre qualification letter) to accompany your offer to purchase, otherwise your offer might be rejected immediately.  So you’ve had to have at least one conversation with a lender in order to get that.  Make it a meaningful conversation, a deep dive into your options…all of them…so that you get the most bang for your hard earned bucks.  In other words, don’t let rising rates put you out your dream of buying a home.  There are GOOD ways for responsible buyers to nab a low rate.