Archive for November, 2012

Hiring a Relative as Your Realtor

Wednesday, November 28th, 2012

by Sean Hess (Sean@StAugTeam.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com). Join us on Facebook and Google+.

Your Relative, not Relativity

Your Relative, not Relativity

I was looking at the Visa bill the other say and mentioned to my kids, “Mommy says Daddy needs to sell another house.”

My wife overheard me and said, “Well even when there’s somebody at work you never know until after they buy the house.”

And I said, “You just summed up real estate marketing in a single sentence.”

That’s the whole crux of it.  We.  Never.  Know.  Who.  Will.  Need.  Us.  Next.

So much of my job as your Friendly Neighborhood Realtor is just trying to find you before you find someone else to buy or sell a home with.  This blog, for example, is me trying to make a connection with you.

So what does this have to do with hiring a relative as your Realtor?

Well, if you already know your relative is a Realtor, you don’t have to search for them and they don’t have to search for you.

Negatives to Hiring a Relative

Let’s start with the negatives first, or the why not to hire a relative.

Because if they screw it up bad (and they may), it’s just going to ruin future Thanksgiving dinners.

Now, if you know ahead of time that your cousin Jerry is worthless, you have some delicate maneuvering to do.

Offer him the opportunity to make a referral to another Realtor, who you will interview first.

Tell cousin Jerry that, “you never mix business with pleasure,” and that it would create too much family stress.

Giving him the opportunity to make the referral and then work in an “advisory capacity” will pump his ego and keep peace in the family.

Positives to Hiring a Relative

If they are a good egg, they will work really hard for you, harder than anyone else.  It will be stressful for them because their reputation in the family is on the line.

And you are still in charge.

How to Make it Work

Treat your Realative (is that a word?) just like you would any other person you would hire.  Don’t assume that just because they are your kin they can read your mind.  Pepper them with questions and don’t stop until you are satisfied with the answer.  If you don’t understand something, keep working with them until you find out.

I would give the same advice to the Realtor…don’t assume your kin can read your mind.  Communicate what you are doing and why, constantly.

Don’t assume they think everything is peachy just because it’s “in your hands.”

Another Reason Why to Hire Your Relative

The real reason you want to hire your relative?  Because they are going to find out!

You can’t exactly pretend you didn’t know they were in the business.

Even if they aren’t in your home market they might be able to refer you to someone really good.  Your Realtor-relative will sincerely appreciate that you asked, even if they can’t help.

Getting back to the marketing angle, Realtors spend so much time trying to find new customers, finding out a relative or friend went and bought a house with someone else…it’s a kick in the stomach you simply can’t describe.

And that will ruin Thanksgiving dinner as well.  Depending on the personality they are either going to yell and scream at you for hiring someone else, or they are going to be polite and cold.

As a disclaimer: I have no dog in this fight.  My local relatives are sparse.  But over the years I’ve seen it just kill other Realtors.

The Reason I Wrote this Post

In the conversation with my wife that started this post, she mentioned that the last guy at work that bought a house had a sister that was a Realtor and she was really, really upset that he used someone else.  The brother bought a house in Jacksonville, the sister worked out of Palm Coast, and the brother didn’t think she could help so he didn’t call her.

She probably couldn’t help but she was upset that she wasn’t at least given the opportunity to refer it.

I didn’t find out if anyone threw a turkey leg or mash potatoes over the incident! :-)

Hire St. Augustine Team Realty the next time you go to buy or sell…but you know, if your cousin Louie is a local Realtor maybe call him first.  Email us at ReQuestion@StAugTeam.com  or call Broker Sean Hess at (904) 386-8327.

All images, video and audio not in the public domain are used in accordance with the Fair Use Law (Per Title 17–United States Code–Section 107) and remain the property of the film or photo copyright owners.

Are more listings available during the Holidays, or after the New Year?

Monday, November 26th, 2012

by Sean Hess (Sean@StAugTeam.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com). Join us on Facebook and Google+.

Are more listings available in November and December, or during January?

My partner Kate Stevens and I had that question posed to us so we did a quick video about it.  Enjoy!

Hire St. Augustine Team Realty the next time you go to buy or sell, before, during or after the Holidays!  Email us at ReQuestion@StAugTeam.com or call Broker Sean Hess at (904) 386-8327.

33 Catalonia Court: Under Contract in 3 Days at Conquistador Condos

Tuesday, November 20th, 2012

by Sean Hess (Sean@StAugTeam.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com). Join us on Facebook and Google+.

My partner Ron Barry just listed this condo at 33 Catalonia Court in Conquistador last week.

With the marketing prowess of St. Augustine Team it went under contract in just 3 days.  This is the second time we’ve pended a listing in 3 days this fall.

In case the buyer backs out or the deal falls through, here’s what you need to know about this wonderful unit:

33 Catalonia Court in Conquistador is an easily accessible first floor unit with renovations completed last year. It includes new laminate hardwood floors, and new stove, refrigerator, microwave, washer and dryer. You will find freshly painted walls throughout the condo along with new light fixtures. This unit features an open layout between the family room, informal dining room and kitchen. Two sets of sliding glass doors open up to the newly screened and tiled rear patio. Conquistador includes three community swimming pools, a fishing dock, and tennis courts. We should also let you know that Ron is related to the seller.

See a short video of the unit below:

Hire St. Augustine Team Realty the next time you go to buy or sell a condo. Email us at ReQuestion@StAugTeam.com or call Broker Sean Hess at (904) 386-8327.

Learning Green Homes in St. Augustine

Tuesday, November 20th, 2012

by Sean Hess (Sean@StAugTeam.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com). Join us on Facebook and Google+.

Green homes are more than just solar.

Green homes are more than just solar.

At the recent National Association of Realtors conference in Orlando, I made finding out what makes a home “green” a priority.

Part of the reason I wanted to find out is that I’ll be buying another home soon, and I wanted to find ways to make the home better for the environment. I also want to save some money on my utility bills, too, which is a practical consideration.

What really surprised me was that solar and geothermal are the “bling” of green, but that they are really minor things when it comes to making a home green. Ditto Energy Star appliances.

What really will make a difference, according to the experts, is insulation.

Yep, plain old boring insulation. But it was a point of emphasis that the insulation had to be correctly installed.

How do you install insulation correctly? I have no idea but I guess I’ll be finding out!

Anyway, homes that are well insulated are good for the environment because they use much less energy to heat and cool, meaning less use of fossil fuels like coal and oil, and less CO2 in the air. Plus there is that practical side; well insulated homes are less drafty, and thus more comfortable.

And they save money on utility bills.

Bring in solar to help augment the power and you can see even more of an impact.

Another thing I learned about was re-purposing and updating older buildings in order to make them more energy efficient.

One of the dangers in bringing an older building up to code or updating it is that you could interfere with the way a building naturally breathes.

In one case a builder updated some older homes with single glazed glass to double-paned glass.

When it got cold the moisture used to condense on the old single glazed glass on the inside of the building. With the new double panes the moisture wouldn’t collect there anymore…so it went other places.  Into people’s clothes, into the walls, etc.  It became a major mold problem.

In another case a moisture barrier was installed on an older home, which did a great job of keeping moisture out.  The problem was it also trapped moisture inside…which created mold.

The first apartment building I lived in here in St. Augustine had no insulation (!) so I have first hand knowledge of how cold and drafty an old building left original can be (I don’t think insulation was a mandatory part of the building code here in Florida until the early 1970s).

But if you were to update that old building you would want to take a serious look at how to insulate it while still letting it breathe.

And if I buy and decide to update an older home, I’ll be very careful to do the same.

Hire St. Augustine Team Realty the next time you go to buy or sell a green home. Email us at ReQuestion@StAugTeam.com or call Broker Sean Hess at (904) 386-8327.

Why Should I Pay Buyer Closing Costs? Why Not Just Knock it Off the Price?

Monday, November 12th, 2012

by Sean Hess (Sean@StAugTeam.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com). Join us on Facebook and Google+.

Closing costs can leave a buyer cash poor.

Closing costs can leave a buyer cash poor.

Why should I pay buyer closing costs? Why not just knock it off the price?

People may have enough to make the downpayment on a house, and qaulify for the loan, but adding $4000 to $5000 in closing costs could mean they won’t be able to buy your home.

It could lead them to be over budget.  Say they are willing to put down $20,000 including closing costs, but simply don’t have enough saved to put down $25,000.  Enough said there.

In another case it could leave the buyers cash strapped or cash poor at closing.

Let’s say you’ve got a young family (or anyone) going FHA and putting down 3.5%, or even getting a full 100% loan either through VA or USDA.

Closing costs of $4000 or $5000 could represent their entire savings (or their entire savings after putting the FHA down payment).   Even if they have more in the bank it’s going to leave them really lean after they buy the house.  $5000 could represent almost six months of payments…the minimum you want in savings in case you lose your job…and having it in the bank instead of using it to pay for closing costs could provide a real safety net.

Will this affect my bottom line?

Yes it will, but not by much.*

Let’s say you agree to sell a house for $140,000 and give the buyers back $5000 towards closing costs, instead of just selling at $135,000.

Because your real estate commission, the state doc stamps, and the owners title insurance policy are all based on purchase price, these charges will be a bit higher, but only by about $360.

*Please note this is a Florida specific example…the costs might be different in your location.

It still has to appraise, doesn’t it?

Yes it does.

In order to give back the closing costs, the house has to appraise for the higher amount.  So in the example above the house would have to appraise for $140,000.

If it doesn’t appraise then you go back to the drawing table.

Let’s say it appraises at $138,000.  The seller might tell the buyer they can do $138,000 and pay for $3000 buyer closing costs (meaning the buyer will have to come up with an extra $2000), or the seller could even say they’ll drop the price to $138,000 and give the full $5000.

Whatever the decision, it will take the buyer and seller working together to make it happen.

Hire St. Augustine Team Realty the next time you go to buy or sell.  Email us at ReQuestion@StAugTeam.com  or call Broker Sean Hess at (904) 386-8327.

All images, video and audio not in the public domain are used in accordance with the Fair Use Law (Per Title 17–United States Code–Section 107) and remain the property of the film or photo copyright owners.

8550 A1A South 32080: New Ocean View Listing in St. Augustine’s Summerhouse Condos

Wednesday, November 7th, 2012

by Sean Hess (Sean@StAugTeam.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com). Join us on Facebook and Google+.

We just listed a fantastic condo, unit 247, in St. Augustine’s Summerhouse. We like to say you can relax there 24/7.

Here’s the skinny (and there’s some video below):

This  comfortable ocean view townhome is located in St. Augustine’s premier beach community, Summerhouse.  With beautiful views of the ocean from the living area, master bedroom and balcony, this condominium will wow you.  Beach access is easy and right in front of your unit. Summerhouse has plenty of green space, four heated pools, tennis courts, clubhouse, and ample parking (including an area set aside for boats and RVs). Fort Matanzas National Monument is just across the street with its hiking trails and access to the Intracoastal.

Find out more by clicking here, and watch the short video below!

Hire St. Augustine Team Realty the next time you go to buy or sell a beach condo.  Email us at ReQuestion@StAugTeam.com  or call Broker Sean Hess at (904) 386-8327.

What’s the “Real Scoop” on Buying a Short Sale (and Why do Some Realtors Discourage You from Seeing Them)?

Monday, November 5th, 2012

by Sean Hess (Sean@StAugTeam.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com). Join us on Facebook and Google+.

Possible location of short sale offers.

Black Hole Cygnus X-1: possible location of lender short sale departments. Image by NASA.

What’s the “real scoop” on buying a short sale?  And why do some Realtors discourage you from seeing them?

Good questions!

First thing, what is a short sale exactly?

A short sale is when a seller tries to sell their home for less than they owe on it.

To do this, they have to have the permission of the bank or lender they owe the money to.   In Realtor jargon this lender is called the “short sale lender.”

The process generally takes from six months to a year to accomplish, from start to finish.

So I may have answered the second question already!

Why do some Realtors discourage buyers from looking at short sales?

If you come to a Realtor and tell them you need to move into a home in the next three or four months, they probably aren’t going to show you short sales.  And if you ask to see short sales, they will discourage you.

The reason is because the short sale process can take so long.

If you backtrack and tell your Realtor, “Hey, I’d be willing to move in to the home in six or nine months,” or “time doesn’t matter,” then they will show you short sales.

Otherwise it won’t compute to the Realtor.

Telling a Realtor you want to move in three months and buy a short sale is like telling them you want a “two-story, one-story” house.  Or that you want to live near a major road but don’t want traffic noise.

What’s the “real scoop” on buying a short sale?

It’s a lot of hurry-up-and-wait for both the buyer and the seller.

Basically, the buyer and seller agree on the purchase price like they would on any home.  While short sales tend to be priced aggressively in order to get an offer sooner and start the long process sooner, it doesn’t mean you can throw any number on a contract and expect the seller to sign.

If you submit an offer on the home that the selling Realtor and the seller are pretty sure the bank won’t accept, expect a counter offer at a higher price.

A buyer also has to submit their pre-approval or proof of funds with the offer, or it can’t be submitted to the short sale lender.

From there the wait begins. 

In the first week after the contract is signed by the buyer and seller, the seller will be filling out a mountain of paperwork to submit to the short sale lender.  And after it is submitted it’s like the offer goes into a big, black hole.

In fact, if the offer actually went into a big, black hole it might be easier to know where it is.

Who knows what these banks actually do with the paperwork?

The earliest you typically hear from them is sometimes 60 days.  Realizing they don’t have the manpower to deal with the offer they may try a stalling tactic, like forcing the buyer and seller to fill out new sales paperwork.

Sometimes there are two mortgages on a property.  In this case both short sale lenders must approve the deal, and they often do so on different timelines.  And if the foreclosure process is going on, a seller might have to have a judge delay the foreclosure so the short sale can proceed.

This is because the bank’s left hand (short sale side) doesn’t know what its right hand (foreclosure sale) is doing.

When the short sale lender comes back with a price. 

The short sale lender(s) eventually come back with a price and terms…sometimes even within 60 days.

Sometimes they actually accept the short sale offer as written.

And sometimes they come back with a different price.  Sometimes this price is realistic, sometimes it is not.

From there the ball is back in the buyer and seller’s court.

The buyer may think the price is too high, and back out.

The seller may think the terms are egregious, and back out.

And after all this time has already passed.

You see now why some people will try and discourage you from buying a short sale?

What then?

Well, if the price really is too high the seller and his or her Realtor will put it back on the market at the new “bank approved” price.

And since this price may not be realistic, the Realtor will leave it there for a few weeks just to prove a point to the short sale lender, and then start reducing it again.

The hope is that someone at the bank will see the light, realize the next offer really is market price, and will accept the next offer.

The alternative for the bank is that the property gets abandoned and gets to rot, empty, in the hot Florida sun while the foreclosure process goes on.  At which point the bank will have to unload a damaged or wasted asset at a lower price and at a higher expense.

What to do if you are buyer and your short sale offer is rejected by the bank?

First of all determine if the bank’s price really is a good price.

Let’s say you offered $200,000 on a home and the bank came back at $210,000.  Assuming you can afford $210,000, is $210,000 a good price?  Have your Realtor do a market analysis and find out if there are equal or better homes out there for the same price.

In other words, before you reject the deal, make sure you can find another equal or better house for the same price.

If you can’t find a better house for the $210,000, maybe $210,000 is the best price.  It might not be what you wanted to pay, but it’s realistic.

Also, if you offer $95,000 on a “bank approved” price and the bank comes back at $97,000 (they do this on “bank approved” prices all the time), you can come back and say, “I’m an investor, I have no emotional stake in the house, if I don’t buy this one I will simply move on to the next one.”

If the offer price and the counter price are that close, this will sometimes work.  This is about the only time you have negotiation power directly with the bank on a short sale offer.

But if the bank’s price is wildly unrealistic there’s not much you can do but move on.

Making an offer on a short sale.

While short sales are still priced aggessively in this market, there’s a lot less inventory than there used to be.

It might be a good idea to have your Realtor do a market analysis before you make an offer.

Part of the bank’s process for accepting or rejecting a price is based on other Realtors’ market analysises (called “BPOs” in Realtor jargon).  Banks hire Realtors to do BPOs (often several BPOs on the same house) to give them an idea of what market price is.

If your offer price is out of line with your own Realtor’s market analysis and thus will be out of line with any BPOs that the bank orders, then your offer is unlikely to be accepted and you are wasting your time, even if the seller accepts your offer.

The seller may simply be using your offer to guage what price the bank really wants, so instead of wasting all your time just to benefit the seller, make a good offer and benefit yourself as well.

Hire St. Augustine Team Realty the next time you go to buy or sell.  Email us at ReQuestion@StAugTeam.com  or call Broker Sean Hess at (904) 386-8327.

All images, video and audio not in the public domain are used in accordance with the Fair Use Law (Per Title 17–United States Code–Section 107) and remain the property of the film or photo copyright owners.

Does the Seller Have to Disclose if the Air Conditioner is Bad?

Friday, November 2nd, 2012

by Sean Hess (Sean@StAugTeam.com), Broker and Manager for St. Augustine Team Realty (www.StAugustineTeamRealty.com). Join us on Facebook and Google+.

Does a seller have to disclose that the air conditioner doesn’t work or the roof is bad?

Yes. If they know about it.

Do you have a plain old house, or did you have a plane in your old house? Better disclose that to a buyer.

Do you have a plain old house, or did you have a plane in your old house? Better disclose that to a buyer. Image by AP.

Sellers in Florida are required to disclose any “latent” defects that would affect the value of the house.

In other words, a seller has to disclose a defect that they know about, that you can’t readily see with the naked eye, and that would affect the value of the house.

This gets tricky when an air conditioner isn’t working or the roof is bad.

You can’t see if an air conditioner is bad.

But you can turn it on to check it out, and so can your inspector. Even if the power is off you can have the power turned on to check it out.

Now, how do you know when an air conditioner doesn’t work? The answer: when it doesn’t turn on one morning.

Like water heaters that break down, one day your a/c will be working and one day it won’t, and most of the time it doesn’t give any warning.

So if you do buy a house and the a/c isn’t working, can you prove that the seller knew it didn’t work? And how do you know it didn’t just happen?

It’s similar with a roof.

If the roof leaks and the seller knows it, the seller has to disclose that to you. But it doesn’t necessarily mean that the roof is “bad.” It just means that the roof leaks.

And if the roof used to leak and the seller fixed it, and it doesn’t leak anymore, does the seller have to live with that and disclose it forever?
For the seller, the best bet is to disclose if there is any question at all, just to avoid future liability.

And for a buyer, understand that you will have a hard time proving that the seller knew anything after the fact. Pick a great inspector and go over the house with a fine-tooth comb, and don’t be afraid to ask the seller hard questions for the record.

Hire St. Augustine Team Realty the next time you go to buy or sell.  Email us at ReQuestion@StAugTeam.com  or call Broker Sean Hess at (904) 386-8327.

All images, video and audio not in the public domain are used in accordance with the Fair Use Law (Per Title 17–United States Code–Section 107) and remain the property of the film or photo copyright owners.