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.

Don’t Kill the Deal

Getting Advice from Friends and Relatives about your First New Home

It turns out that I work with a lot of first time home buyers, and I am a HUGE fan of it. I love, and feel honored by, helping people with this first big step in life. Most of my first time buyers are smart, young, professional contributors to society and I appreciate them; and I make it my job to protect their financial input to their purchase. I just love helping them. Nearly all of my first time buyers make it to closing and actually into their first ‘move-up’ home. But not all of them. Some of them never get to the closing table.

I do a good job of helping my clients be ready and able to purchase when they find the home they love. That starts with finding a good lender, getting pre-approved, and looking at homes they can actually afford. In other words, they don’t find out at the 11th hour that they can’t afford the home they chose.

Most often, though, the ones that never get to close are the ones taking advice from ‘friends and family’ behind the scenes. These would be people who do not have a stake in the purchase, or do not have a realistic expectation of the process. In other words, they are not professional real estate agents! For example: Some parents forget that THEIR first home was 1000 square feet and needed work. They walk through the homes with their children with completely unrealistic expectations of the price point, and their child goes forward feeling disappointed. Parents walk through pointing out all of the flaws and elevating their child’s expectations beyond what the child can afford. Sometimes you have to start out without granite countertops and hardwoods throughout. I can’t tell you how many times I’ve said this: “You’re going to have to go up in price to get that.” So parents with the best intentions in this case, end up crashing their child’s dream.

Another example is the handyman dad who says, “I can build you a house’. Or…”Find a foreclosure that needs work and I’ll fix it up for you.” Well….first of all, those houses have to be bought as a cash purchase, because no lender will do a mortgage on them. Want to build from the dirt up, handyman dad? You have to pay cash for the land and here, that’s going to start at twenty grand for a lot in a less desirable area, more in the more desirable ones. Think about this: How many people do you know who have a regular job, that can go out and build a house in their ‘spare time’, and afford the cost. Think: Refrigerator, stove, dish washer, water heater, HVAC system, wiring, plumbing, roof, flooring. I don’t have any handymen like that in my contact list. Why? They do not exist.

So yes, family and friends can foul the whole process, and they do. Because they are not real estate agents, they don’t understand the process or market, and they don’t know the ‘rules’ for lending on certain types of property. Do they have the best of intentions? Most of the time, but not always. Some just ‘don’t like realtors’ and some always feel like someone’s out to get them. Those people are never happy, for anyone.

But. There are often parents and family who ARE interested in the happiness and success of their children. How can I tell? They come and meet me, and we sit down together and talk. I answer questions for them, and ultimately let them know that I am honest, excited for their child, and very good at what I do. It doesn’t take long before we are all on the same page and excited for the child buying her or his first home. And that’s the magic formula.

So, if you are a family member or ‘interested party’ who will advising behind the scenes, if I don’t meet you face to face, I expect you to cause problems. Not because you’re a bad person, but because you are not a real estate agent and some of your advice will be wrong, or just plain bad. Talk to me. Bring me your concerns and let’s talk through them. I love a team working toward a common goal. It’s the best way to succeed. Most of all, I want my client to be happy.

DECLUTTER: the Seller Dirty Word

Nobody wants to hear that their home is too full of stuff. But let’s face it: If you live in a home long enough, you accumulate a lot of it, and only you become blind to it. Everybody else walks in and says (hopefully to themselves), “Wow, there’s a lot of ….” you get the idea. I’ve lived where I live for almost 7 years, and I KNOW if I list I’m gonna have a LOT of work to do.

I’m a realtor who actually likes to see personal items in the home, because to me, it makes the place warm and…well, home-like. The other half of the realtor word will tell you to take out all personal items and paint everything and put in new carpet. In other words, try to make your used home a new home. I don’t necessarily advise that, unless the particular case needs it. For me, it’s only pix of your children that should go, and alters. Yes, people do have them, and yes, they can effect your selling ability. But CLUTTER (sorry about the dirty word) has GOTTA GO.

You will say, “If they don’t like my stuff they can take a hike.” Yes, I have heard that. But that statement comes from a person who has not gotten their brain around the true idea of selling. If you are not willing to take the advice of your professional listing agent, then you don’t really want to sell you house. It’s that simple.

I had clients who held on to their clutter so tightly that it cost them tens of thousands of dollars to sell the home. Kid you NOT. Clutter makes a difference in how much cold, hard cash you put in your pocket at the end of the transaction folks, and here’s why:

  1. Buyers will think you don’t take care of the house, i.e. MAINTAIN it, and therefore will not want it. OR they will make a lowball offer. Yes, it’s a leap to go from ‘too much stuff’ to ‘they probably don’t maintain the house’, but trust me! They do! Every time. Even though they, themselves, probably don’t run a tight ship, they will expect you to, and will judge you harshly if you don’t. And they will walk away with their money, which you are trying to get.
  2. Buyers need to envision THEIR stuff in the house. You want them to stand there and place their furniture and other ‘stuff’; and if yours overwhelms them, then they can’t see theirs. You WANT them to see THEIR STUFF there; that’s how you sell the house. If they think they can’t fit their stuff in the house, they will leave with their money, which you are trying to get them to give to you.
  3. Buyers are buying SPACE. The more ‘stuff’ you have in the space, the smaller the space looks. If the space looks small, the buyers will think, “Hmmm, this house is small.” And they will leave, taking their money with them. That would be money you would like to have. Following me?

So, here’s the deal: Ya gotta clean out the ‘stuff’. Get rid of the clutter. Now that doesn’t mean THROW AWAY the clutter. NO! It means go ahead and move it out. You’re leaving anyway. Just let it go first. Put it in storage or your friend’s garage. That would be a GOOD friend, but I digress. Then, dust in all the spots you couldn’t get to because of all of the stuff you used to have there, and your offer price JUST WENT UP. I am NOT kidding about this. Oh, and guess what? When you have to decide what size storage unit you need for your stuff? Suddenly you don’t mind actually getting rid of some of it.

Listen, I feel your pain. I think about the day I have to list my home and I literally shudder. I’ll even have to paint because I have so much wall art. So I get it. But you gotta do it.

And finally, let me say that when I say ‘stuff’, I’m also thinking of another ‘s’ word, that most buyers ACTUALLY USE, as in: “There’s too much s*** in here.”

Should I List My Home in October?

Short answer: Yes.

Listen, I think I’ve worn you guys out telling you that real estate is “local”, even sometimes down to sections within a subdivision. This is SO incredibly true, and is a fact, however cliche, which should not be ignored. These days, people look on Zillow and Realtor.com (both of which I visit myself, often), and they do their own market analysis without knowing the personality of their subdivision, let alone the town or region. There may be some great areas within the subdivision and some not-so-great ones, for a variety of reasons. And some towns are destination locations for students, doctors, patients, retirees…you name it. Each of those groups has a specific need, and you need an agent who knows the markets to satisfy them.

What you need to know about the Triangle and surrounding areas, is that we have a housing shortage here, and over 60 thousand people moving in EVERY DAY.

So yes. List. Your. House. In. October. Call me.

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?

Choosing Colors when you Plan to Sell Your Home

One of the best updates for your home when you are planning to sell, is paint. Nothing creates quite the immediate impact as fresh paint throughout the home inside OR out. But it can go terribly wrong. I have shown properties where the colors throughout the house might as well have been clanging cymbals. The colors made no sense, and in fact created an extremely negative experience for my buyers. And the homes didn’t sell until they were painted, by the way. The goal for sellers is to make the home inviting and interesting, not dreadful.

Did you know there are ‘warm’ and ‘cool’ colors? If you don’t, take some time to investigate the concept. The fastest way to set up a subconscious frown in the mind of a buyer is to mix the two. If you have a brown roof, don’t paint the exterior of the home light blue, for example. Imagine a blue room with a gold/orange accent wall. Terrible! In the picture below you see a vibrant color combination, using a warm, Tuscan theme. The color scheme isn’t for everyone, but it works in a kitchen where pretty much everything else is white.

Another good idea is to start with a neutral and use decor to create contrast.


Martha Stewart once said that you should imagine your colors as if you are looking through the space, seeing all rooms in series. The colors should be complimentary, should not clash. They don’t have to match, but they do have to harmonize.

If you’re starting with a new home, you will most likely have the builder grade monotone throughout the home, and that’s fine if it is what you like; however most people choose to customize their homes with respect to wall color. Your home is the heart of your life and it should make you feel joyful, warm, safe. Color can do that, but choose a theme…mine is Tuscan. Yours might be The Beach. You get the idea.

However you choose to decorate, remember that when you sell, you want to appeal to the buyer. So be sure…whether you choose a cool or warm palate…that you keep to the same family. That way everything in the ‘background’ of the buyer’s subconscious experience flows and feels continuous. Remember that much of marketing is psychological. So don’t shock your potential buyers with disharmonious paint colors. One negative seed can grow into a complete rejection of an otherwise great property.

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.

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.

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.

Wanted: Experienced Realtors…

Just like other areas of life, there was a recent push to replace experienced real estate agents with “millennials”.  The thinking was that millions of home buyers would be people in this age cohort, that they would be THE buyers and that they would want to work with agents who were their peers.  Well that wasn’t on target, to put it mildly.  Many of the younger buyers are renting and paying off college loans, or even staying at home with Mom and Dad…not buying.  Real estate planners shouldn’t feel bad; retail made that mistake too.  Many of the millennials are educated, savvy, street smart and skeptical about anybody wanting their sparse cash.  They want details, they want to know their agent has a solid knowledge of the market and is well capable of walking them through the jungle of tasks associated with buying and selling a home.  In other words, millennials expect to be leaders and as such, their real estate agent had better be qualified to take that lead.

Millennials who do buy are not usually in the higher end market; rather, they are usually in the first time buyer and first time move-up buyer price range.  They, and other who ARE buying in the high end market do not want a “millennial” guiding the transaction.  Well, I’m a 10,000 foot view person.  I saw this stumble coming a mile and a half away.  Don’t get me wrong; I love young people.  The ones I get to meet and work with are very smart, very motivated and very sensible about buying.  They give  me hope for the future.  But young real estate agents are not well rounded, confident and knowledgable about the market just yet.  They deserve to grow and build a skill base, yes; but that doesn’t negate the value of experience.

So some of the same companies who were nudging the older agents aside are now actively recruiting experience.  It’s a shame that experienced agents are often overlooked by the ‘planners’ of the future of area market movement, and that that experienced agents are re-noticed only when the cavalry is needed.  But that’s how it goes.

My advice to you is this: Realize that you are making one of the largest transactions of your life, and that you should put that transaction in the hands of experience and knowledge.  That doesn’t mean someone who made a high score on the test, although that’s important.  It means someone who understands the nuances of the market beyond what the publications say.  It means someone who understands that prices in neighboring communities can be very different and why.  It means someone who has experience with inspectors and builders.  It means someone who knows how to spot hidden potential issues.  It means someone who knows what’s worth worrying about and what is not.  It means knowing the importance of pricing and how it impacts the overall market.  It means knowing how to put the most cash in your pocket at the end of the day.

I decided to write about this subject today because I have been working on a market analysis for the last several days, in a new growth-spurt area, where prices have jumped significantly in the last year.  I want to push my list price as high as I can…and be able to have it appraise at that value when the time comes.  This of course prompted a deep dive into that area and into that community, and a subsequent spreadsheet…mine, not a canned product.

One of the values I use, LOOSELY, I might add, is price per square foot.  And while this is the WRONG WRONG WRONG value to use in pricing a home, it does give you a nice snapshot of market activity at-a-glance, and it can be quite eye opening.  It was for me.  In my area of interest there were 3 of 14 homes I studied, which had VERY much lower sold price-per-square-foot.  This prompted me to look at the listing agency AND agent, and each case, the agent was inexperienced.  This costed the home owners/sellers a lot of money they could have made on their transactions and it hurt the overall market.  These low-ball prices will be put into the “comp” pot, and will be used by appraisers in pricing other homes for mortgages.  And this tells me nobody’s guiding these agents appropriately and nobody has told them the value of strong pricing.  Nobody has shared with them that listing with strong prices raises the entire market, which is actually our job…to protect the market.

So, while other home sold in the 118.00 price per square foot, these homes sold at around 108.  That adds up.  To loss for the sellers.  The moral of the story is this: If you hire inexperience, it will cost you.  You may never know it…which would be the best scenario.  If you do know it, you have to wonder where else you got short-changed.

I need to also say that sometimes it pays to price low if a quick sale is needed…for the SELLER, not the agent.  And that’s all I will say about that.

Bottom line: Be sure your agent is experienced enough to be a strong, successful advocate for you.  That’s what you are paying for.  This isn’t an opportunity to be trendy; this is your money at stake.  Experienced agents will understand that.