Bush Signs Sweeping Housing Bill
By DAVID M. HERSZENHORN
Published: July 31, 2008
WASHINGTON — President Bush signed into law on Wednesday a huge package of housing legislation that included broad authority for the Treasury Department to safeguard the nation’s two largest mortgage finance companies and a plan to help hundreds of thousands of troubled borrowers avoid losing their homes.
Mr. Bush signed the legislation, which Congress approved last week, shortly after 7 a.m. in the Oval Office, the deputy White House press secretary, Tony Fratto, said.
The law authorizes the Treasury to rescue the mortgage finance giants, Fannie Mae and Freddie Mac, should they verge on collapse, potentially by spending tens of billions in federal monies. Together, the companies own or guarantee nearly half of the nation’s $12 trillion in mortgages.
Partly to accommodate the rescue plan for the mortgage companies, the bill raises the national debt ceiling to $10.6 trillion, an increase of $800 billion. The bill also creates significant liabilities and risks for taxpayers, that are virtually impossible to calculate.
“We look forward to put in place new authorities to improve confidence and stability in markets, and to provide better oversight for Fannie Mae and Freddie Mac,” Mr. Fratto said. “The Federal Housing Administration will begin to implement new policies intended to keep more deserving American families in their homes.”
A half-dozen top advisers to the president, including the Treasury secretary, Henry M. Paulson Jr., who was the leading advocate of the legislation in the administration attended the signing. But it was not a particularly auspicious occasion given the precarious state of the nation’s financial system, and the pressure that Mr. Bush came under to sign a bill that contained provisions he had opposed.
Though the legislation was the product of months of intensive work by lawmakers in both parties and has been hailed as the most aggressive intervention by the government into the housing market in more than a generation, perhaps since the New Deal, no members of Congress were invited to the signing.
The enactment of the legislation comes in the same week that the administration announced that Mr. Bush would leave behind a record $482 billion deficit, which will probably grow substantially if home values continue to decline and if there are further reductions in corporate and personal income as many economists are forecasting for the rest of the year. Because of the growing deficit, Democrats said, the debt ceiling had to be lifted regardless of the housing bill.
The new housing law includes a plan aimed at helping as many as 400,000 homeowners pay off their troubled mortgages and replace them with more affordable, government-insured loans. The program is voluntary and the lenders must agree to take a sizable loss, reducing the principal of each loan, before they can be refinanced.
The law authorizes the Federal Housing Administration to insure up to the $300 billion in such loans but the Congressional Budget Office has estimated that only $68 billion of that authority is likely to be used. The original lenders will have to pay upfront fees into an insurance fund, and borrowers will pay continuing insurance premiums of 1.5 percent a year to insulate taxpayers against losses from defaults.
The budget office has estimated that 35 percent of the refinanced loans will end up in trouble again.
The authority for the Treasury Department to help Fannie Mae and Freddie Mac is limited only by the debt ceiling. The budget office has said that a $25 billion expense should appear on the federal budget for the next two fiscal years, representing its best estimate of how much the program will end up costing taxpayers.
But the budget office said there was a better than 50 percent chance that the rescue authority would not be used, and there would be no cost, while there was a 5 percent chance that one or both of the mortgage giants would lose another $100 billion or more, costing taxpayers a vast sum.
Some experts have said that the law was wrong-headed in its effort to retain the hybrid nature of the mortgage finance giants, which are private companies with publicly traded stock, but which have an explicit guarantee of help from the government — an arrangement that critics say privatizes the profits but socializes the risk and any losses.
David M. Walker, the former comptroller general of the United States and head of the Government Accountability Office who is now president of the Peter G. Peterson Foundation, said that Mr. Bush might have been unwise to sign the measure.
“Providing authority to the secretary of the Treasury to extend credit or to buy stock is one that will end up costing the taxpayers tens of billions of dollars,” Mr. Walker said in an interview earlier this week.
Mr. Walker noted that other government interventions in the private market, including a rescue of the Chrysler automobile company had provided an opportunity for taxpayers to profit. But when it comes to the mortgage giants, he said, there is no upside.
“The way this is structured,” he said. “It’s only a matter of how much the taxpayers are going to lose.”
Supporters of the legislation — including Senator Christopher J. Dodd, Democrat of Connecticut and Senator Richard C. Shelby, Republican of Alabama, the leaders of the banking committee, and Representative Barney Frank, Democrat of Massachusetts, the main author of the legislation in the House — say the law represents the best way to help stabilize the housing market, potentially putting a solid floor under declining prices.
The bill includes an array of other aid for troubled borrowers, and about $15 billion in housing-related tax breaks. It also includes nearly $4 billion grants to local governments to buy and refurbished foreclosed properties, which Mr. Bush had opposed even as he signed the measure. The White House views that provision as a giveaway to banks and other lenders who own the seized properties.
Wednesday, July 30, 2008
Housing Market Bill
Housing Bill Has Something for Nearly Everyone
There are really some good positive elements to this bill. It will encourage Buyers to move now instead of later on purchasing a home In addition Sellers will have an important additional reason not to delay in listing, or if they are listed already, getting the property priced right. The first time home buyer provision has the potential to get the entry level of the market moving again and we all know that will help re-create a move up segment of the market; a segment of the market that is currently almost non-existent.
Cut from Friday's New York Times Article.
By RON LIEBER
Published: July 25, 2008
If you are ignoring the housing bailout bill because you think it benefits only troubled homeowners, you may miss out on a windfall.
The bill, expected to be passed by the Senate in the next few days and then signed by President Bush, does offer incentives to certain overextended borrowers and their mortgage lenders.
But it also includes many handouts to first-time homebuyers, longtime homeowners, returning veterans and senior citizens seeking to tap their home equity without getting hit with big fees. Millions of people have the potential to benefit in some way.
Huge numbers of people buying homes for the first time, for instance, will be eligible for what amounts to an interest-free loan from the government. Meanwhile, older Americans will now be able to borrow more and possibly pay less for reverse mortgages that allow them tap the equity in their homes.
Whether larding up the bill with all these benefits is good for taxpayers is a debate for another part of the newspaper. But there is no shame in taking advantage of what is offered. In fact, you would be foolish not to.
Here are some of the new benefits:
RENEGOTIATING MORTGAGES Part of the bill is devoted to the creation of a program that may allow some people to cancel their old mortgage loans and replace them with new fixed-rate loans lasting at least 30 years. The amount of the new loans would be no more than 90 percent of what their property is actually worth now.
So who is eligible? You need to have originated your troubled loan or loans on or before Jan. 1, 2008. The loans in question must be on your primary residence. Vacation homes and investment properties are ineligible. You will also need to verify your income, which many borrowers did not have to do in recent years.
Also, as of March 1, 2008, your monthly housing payment (including the principal on all your various mortgage payments, interest, taxes and insurance) has to have been at least 31 percent of your monthly household income. So if you were earning $5,000 a month and had housing payments of $3,000, you are eligible. But if you had payments of just $1,400, you would not be, presumably because that loan is affordable given the size of your income.
Lenders, however, are not required to give you a better deal under the new law, even if you do meet the qualifications. They may not be willing to negotiate unless they think you are truly on the cusp of foreclosure.
If you manage to get a new loan, you cannot take out a home equity loan for at least five years after you get the new mortgage. You will also have to pay a 1.5 percent fee each year on the remaining balance. Finally, you have to hand over no less than 50 percent of any appreciation on the home to the government once you sell. Sell the house in less than five years, and you will have to turn over as much as all of the gain.
This program ends on Sept. 30, 2011. While it does not officially take effect until Oct. 1, lenders may be willing to start their negotiations with borrowers now.
BREAK FOR FIRST-TIME BUYERS If you are buying a home for the first time, and it is your primary residence, you are eligible for a federal tax credit of $7,500 or 10 percent of the purchase price, whichever is smaller. With a tax credit, you subtract the credit amount from the total you would otherwise pay to the Internal Revenue Service. So if you owe $1,500 and you qualify for the credit, you would end up getting a $6,000 refund.
There are two big catches, though. If you earn a modified adjusted gross income of more than $75,000, or $150,000 if you are married and filing your tax return jointly, the credit starts to phase out. For single people, it phases out completely at $95,000 of annual income, while for married people filing jointly, it phases out at $170,000.
But you have to pay back the credit over the next 15 years, in equal amounts each year when you pay your federal taxes. That makes this more like an interest-free loan than a true credit. According to the National Association of Realtors, there were about 2.5 million first-time home buyers in 2007. A large proportion of them would have qualified for this credit, but whether it is enough to push would-be buyers over the edge this year remains to be seen.
The tax credit is retroactive to home purchases on April 9, 2008, and expires on July 1, 2009. If you purchase a home from Jan. 1, 2009 to June 30, 2009, you can claim the tax credit on your 2008 tax return.
ADDITIONAL DEDUCTION If you are a homeowner who takes the standard deduction on your federal income taxes and does not itemize, this one is for you. You can now take an additional federal tax deduction of $500, or $1,000 if you are married and filing your tax returns jointly. Again, this one is gravy; you get it in addition to the standard deduction.
There are really some good positive elements to this bill. It will encourage Buyers to move now instead of later on purchasing a home In addition Sellers will have an important additional reason not to delay in listing, or if they are listed already, getting the property priced right. The first time home buyer provision has the potential to get the entry level of the market moving again and we all know that will help re-create a move up segment of the market; a segment of the market that is currently almost non-existent.
Cut from Friday's New York Times Article.
By RON LIEBER
Published: July 25, 2008
If you are ignoring the housing bailout bill because you think it benefits only troubled homeowners, you may miss out on a windfall.
The bill, expected to be passed by the Senate in the next few days and then signed by President Bush, does offer incentives to certain overextended borrowers and their mortgage lenders.
But it also includes many handouts to first-time homebuyers, longtime homeowners, returning veterans and senior citizens seeking to tap their home equity without getting hit with big fees. Millions of people have the potential to benefit in some way.
Huge numbers of people buying homes for the first time, for instance, will be eligible for what amounts to an interest-free loan from the government. Meanwhile, older Americans will now be able to borrow more and possibly pay less for reverse mortgages that allow them tap the equity in their homes.
Whether larding up the bill with all these benefits is good for taxpayers is a debate for another part of the newspaper. But there is no shame in taking advantage of what is offered. In fact, you would be foolish not to.
Here are some of the new benefits:
RENEGOTIATING MORTGAGES Part of the bill is devoted to the creation of a program that may allow some people to cancel their old mortgage loans and replace them with new fixed-rate loans lasting at least 30 years. The amount of the new loans would be no more than 90 percent of what their property is actually worth now.
So who is eligible? You need to have originated your troubled loan or loans on or before Jan. 1, 2008. The loans in question must be on your primary residence. Vacation homes and investment properties are ineligible. You will also need to verify your income, which many borrowers did not have to do in recent years.
Also, as of March 1, 2008, your monthly housing payment (including the principal on all your various mortgage payments, interest, taxes and insurance) has to have been at least 31 percent of your monthly household income. So if you were earning $5,000 a month and had housing payments of $3,000, you are eligible. But if you had payments of just $1,400, you would not be, presumably because that loan is affordable given the size of your income.
Lenders, however, are not required to give you a better deal under the new law, even if you do meet the qualifications. They may not be willing to negotiate unless they think you are truly on the cusp of foreclosure.
If you manage to get a new loan, you cannot take out a home equity loan for at least five years after you get the new mortgage. You will also have to pay a 1.5 percent fee each year on the remaining balance. Finally, you have to hand over no less than 50 percent of any appreciation on the home to the government once you sell. Sell the house in less than five years, and you will have to turn over as much as all of the gain.
This program ends on Sept. 30, 2011. While it does not officially take effect until Oct. 1, lenders may be willing to start their negotiations with borrowers now.
BREAK FOR FIRST-TIME BUYERS If you are buying a home for the first time, and it is your primary residence, you are eligible for a federal tax credit of $7,500 or 10 percent of the purchase price, whichever is smaller. With a tax credit, you subtract the credit amount from the total you would otherwise pay to the Internal Revenue Service. So if you owe $1,500 and you qualify for the credit, you would end up getting a $6,000 refund.
There are two big catches, though. If you earn a modified adjusted gross income of more than $75,000, or $150,000 if you are married and filing your tax return jointly, the credit starts to phase out. For single people, it phases out completely at $95,000 of annual income, while for married people filing jointly, it phases out at $170,000.
But you have to pay back the credit over the next 15 years, in equal amounts each year when you pay your federal taxes. That makes this more like an interest-free loan than a true credit. According to the National Association of Realtors, there were about 2.5 million first-time home buyers in 2007. A large proportion of them would have qualified for this credit, but whether it is enough to push would-be buyers over the edge this year remains to be seen.
The tax credit is retroactive to home purchases on April 9, 2008, and expires on July 1, 2009. If you purchase a home from Jan. 1, 2009 to June 30, 2009, you can claim the tax credit on your 2008 tax return.
ADDITIONAL DEDUCTION If you are a homeowner who takes the standard deduction on your federal income taxes and does not itemize, this one is for you. You can now take an additional federal tax deduction of $500, or $1,000 if you are married and filing your tax returns jointly. Again, this one is gravy; you get it in addition to the standard deduction.
Wednesday, July 23, 2008
CHANGING MARKET
Change is the law of life. And those who look only to the past or present are certain to miss the future. - John F. Kennedy
Today's market and economy is the utmost reflection of change. The prices of fuel, food, homes, technology and communication advances and the upcoming elections all reflect change. Whether we like it or not change is what we will see. Knowing this we can either except change by changing our attitudes toward it or get stuck in a rut. Embrace change and take advantage of it.
There are many good deals on homes currently for sale. If you are a first time home buyer now is your chance to pick up some good deals and take advantage of the down payment assistance programs available to FHA buyers.
I work closely with several lenders who have access to these good programs and can tell you what you need to do to qualify for them.
Please call or shoot over an email if you have any questions regarding the home buying process or where to start!
Hang in There... The best is yet to come.
Mortgage Rates This Week
30 Year Fixed: 6.26%
15 Year Fixed: 5.78%
1 Year Adj: 5.10%
(U.S. Weekly Averages)
Today's market and economy is the utmost reflection of change. The prices of fuel, food, homes, technology and communication advances and the upcoming elections all reflect change. Whether we like it or not change is what we will see. Knowing this we can either except change by changing our attitudes toward it or get stuck in a rut. Embrace change and take advantage of it.
There are many good deals on homes currently for sale. If you are a first time home buyer now is your chance to pick up some good deals and take advantage of the down payment assistance programs available to FHA buyers.
I work closely with several lenders who have access to these good programs and can tell you what you need to do to qualify for them.
Please call or shoot over an email if you have any questions regarding the home buying process or where to start!
Hang in There... The best is yet to come.
Mortgage Rates This Week
30 Year Fixed: 6.26%
15 Year Fixed: 5.78%
1 Year Adj: 5.10%
(U.S. Weekly Averages)
Monday, July 21, 2008
Short Sale Vs. Regular Sale
Are they different?
by bob Stephens, CBR, e-PRo
Not much! Let's look at it this way. A regular normal sale contains an offer and an acceptance by the seller. The contract then is packed with contingencies that are pretty much in favor of the buyer. They can walk away from the deal in many ways as the deal progresses. The seller does not have this ability unless the buyer breaches the contract. Most notable of the contingencies, usually, is that the buyer must borrow money to buy the house and has a financing contingency to obtain a loan from a lender.
Now let's look at it in the "short sale" mode. Everything is the same including an OFFER by the buyer and an ACCEPTANCE by the seller, except there is a contingency regarding lenders for BOTH the buyer and the seller. The seller owes MORE to the lender than the house is worth and must now ask the lender to "forgive" some of the money owed to them to be able to close the deal. As you see, there are two lenders involved in this transaction- one for the buyer and one for the seller. And as always the lenders make a lot of demands on paperwork to clear their delas and be able to close. The paperwork is just a little different: the seller must be able to prove hardship and document WHY he cannot pay what he owes the lender. On the other hand, the buyer must prove WHY and how he can pay back the lender.
Neither of these lenders OWNS the house and never will unless they are forced to foreclose on it. The seller's lender has a lien on it that must be released so that the buyer's lender has clear title and can then place a new lien on the home.
There is a misconception that the seller's lender seems to be the only one that has any power. Yes, of course they have some power, but so does the buyer's lender; the buyer's lender makes loans as a business to make money; the seller's lender wants to make the deal so they don't have the great expense of foreclosure. Too many forclosures and they will have a real problem getting their loans insured.
I hope a different lok at the transactions will make them a little cleaner.
Bob Stephens is a managing broker of West USA Realty
by bob Stephens, CBR, e-PRo
Not much! Let's look at it this way. A regular normal sale contains an offer and an acceptance by the seller. The contract then is packed with contingencies that are pretty much in favor of the buyer. They can walk away from the deal in many ways as the deal progresses. The seller does not have this ability unless the buyer breaches the contract. Most notable of the contingencies, usually, is that the buyer must borrow money to buy the house and has a financing contingency to obtain a loan from a lender.
Now let's look at it in the "short sale" mode. Everything is the same including an OFFER by the buyer and an ACCEPTANCE by the seller, except there is a contingency regarding lenders for BOTH the buyer and the seller. The seller owes MORE to the lender than the house is worth and must now ask the lender to "forgive" some of the money owed to them to be able to close the deal. As you see, there are two lenders involved in this transaction- one for the buyer and one for the seller. And as always the lenders make a lot of demands on paperwork to clear their delas and be able to close. The paperwork is just a little different: the seller must be able to prove hardship and document WHY he cannot pay what he owes the lender. On the other hand, the buyer must prove WHY and how he can pay back the lender.
Neither of these lenders OWNS the house and never will unless they are forced to foreclose on it. The seller's lender has a lien on it that must be released so that the buyer's lender has clear title and can then place a new lien on the home.
There is a misconception that the seller's lender seems to be the only one that has any power. Yes, of course they have some power, but so does the buyer's lender; the buyer's lender makes loans as a business to make money; the seller's lender wants to make the deal so they don't have the great expense of foreclosure. Too many forclosures and they will have a real problem getting their loans insured.
I hope a different lok at the transactions will make them a little cleaner.
Bob Stephens is a managing broker of West USA Realty
Saturday, July 19, 2008
Buyer Needs in Todays Market
As a seller many home owners are being faced with the fact that many of the buyers in the $300,000 or less range are taking advantage of the current lending conditions and calling upon the use of FHA and many of the downpayment assistance programs available to them in order to buy their "new" home.
Many sellers are being ask to provide closing cost assistance as well as down payment assistance for these buyers in order for their home to sell. Typically buyers in need of this assistance will work with their agent to adjust the price of the home (as long as the market will bear the price increase and still appraise for the appropriate value)
After an agent and their buyers sit down and review all the comps, the neighborhood, value and need of the buyer they may submit an offer asking as much as 7% towards their costs from the seller to help them purchase their new home.
This is a tough market for sellers who are trying to get the max amount for the home, but also trying to meet the needs of the buyers since these seem to be the opportunities most sellers have to sell their home. The typical first time home buyer does not have the needed 5%- 7% to be able to get a house on their own without the sellers assistance and in many cases the sellers do not have any other options for conventional buyers that are putting huge chunks of money down.
One good thing sellers who are not facing foreclosure or short sale can be greatful for are these buyers. 1st time home buyers requesting this assistance do not normally have the money saved in the bank and that is why they are purchasing these turn-key style homes where no immediate money is needed for fixing or remodeling in order to make the home livable.
A majority of the bank owned properties that I have encounter in recent months are clearly in need of major things such as appliances, carpet and paint, I have seen things missing to the extreme, such as air conditioning units, light fixtures and cabinets that would need replacing in order to make the "As Is" Steal that many people believe bank owned homes are reasonably livable.
So keep your head up when you see the banked owned down the street go up for 10-30 thousand less than you want for your property it might not be a BAD thing! In the last few months I have sold Turn-Key Homes for as much as $30,000 more than one foreclosure in the same neighborhood sold for.
What is desirable and looks appealing is still a key player in most Buyers minds!
For a free in home evaluation of your house and what you need to make it marketable... Call me.
Many sellers are being ask to provide closing cost assistance as well as down payment assistance for these buyers in order for their home to sell. Typically buyers in need of this assistance will work with their agent to adjust the price of the home (as long as the market will bear the price increase and still appraise for the appropriate value)
After an agent and their buyers sit down and review all the comps, the neighborhood, value and need of the buyer they may submit an offer asking as much as 7% towards their costs from the seller to help them purchase their new home.
This is a tough market for sellers who are trying to get the max amount for the home, but also trying to meet the needs of the buyers since these seem to be the opportunities most sellers have to sell their home. The typical first time home buyer does not have the needed 5%- 7% to be able to get a house on their own without the sellers assistance and in many cases the sellers do not have any other options for conventional buyers that are putting huge chunks of money down.
One good thing sellers who are not facing foreclosure or short sale can be greatful for are these buyers. 1st time home buyers requesting this assistance do not normally have the money saved in the bank and that is why they are purchasing these turn-key style homes where no immediate money is needed for fixing or remodeling in order to make the home livable.
A majority of the bank owned properties that I have encounter in recent months are clearly in need of major things such as appliances, carpet and paint, I have seen things missing to the extreme, such as air conditioning units, light fixtures and cabinets that would need replacing in order to make the "As Is" Steal that many people believe bank owned homes are reasonably livable.
So keep your head up when you see the banked owned down the street go up for 10-30 thousand less than you want for your property it might not be a BAD thing! In the last few months I have sold Turn-Key Homes for as much as $30,000 more than one foreclosure in the same neighborhood sold for.
What is desirable and looks appealing is still a key player in most Buyers minds!
For a free in home evaluation of your house and what you need to make it marketable... Call me.
This is a fantastic article to help you select your Realtor if you are looking to sell your home.
The Jen Team will sit down with you and devise a plan for what will work in todays market and what needs to be done to sell your home. Our honesty is our best policy and we will do our best to work with every situation or give you the alternatives you deserve to make your best informed decision before you list your home.
If you are interested in Selling or just curious about the current market conditions, call our expect listing agent Dani Miller at 480-695-2010 for a free consultation today!
Tips on choosing listing agent in today's market
By Dian Hymer Published: 11/26/2007
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It wasn't too long ago when it didn't matter as much which real estate agent you chose to sell your house if it was located in one of the many hot seller markets. Listings sold without much assistance; many soon after the for-sale sign went up. Today, choosing the right agent for the job can make the difference between a sale and no sale.
There are many factors to consider in selecting an agent today. One is that many of the agents working now entered the business recently. They've never seen a softer home-sale market before. This doesn't mean that you shouldn't use an agent who doesn't have decades of experience. But, it means you need to find an agent with a definite set of skills.
Most sellers in this market want and need an agent that will provide an aggressive and broad-based marketing plan. However, some sellers may not be aware of how important it is to hire an agent who is an adept communicator. Today's successful agents don't stop selling when they find a buyer for your home. They manage the transaction carefully and skillfully until the sale closes.
It's not enough for an agent to promise to hold your home open every weekend until it sells. In fact, this might do more harm than good. In a slow market, a listing can be overexposed to the market and become shopworn.
The stress level of selling can be intense, particularly if property values are declining. Buyers can be demanding. You need to have confidence that your agent is representing your best interests and negotiating on your behalf in a professional manner.
Negotiating a purchase contract in this market can be an arduous endeavor. It may take multiple counteroffers back and forth to hammer out a deal. And, the fall-out rate is higher today than it was a few years ago.
Selecting an agent who is a good negotiator, who is patient and who will explore all options before letting a deal fall apart gives you a leg up. It helps if your agent has a good working relationship with other agents in the area. One of these agents is likely to represent the buyer for your home.
HOME SELLER TIP: Many agents, and real estate brokerage companies, will leave the business when they discover that they can't make enough money in the current market. Real estate agent ranks swelled immensely in recent years. For example, in California there are now 50 percent more real estate agents in the business than there were five years ago. Make sure that you work with an agent and a brokerage firm that is in the business for the long term.
Ask any agent you consider to provide you with a detailed marketing plan to let you know how he or she will accomplish the sale of your home. Don't even consider listing with an agent that doesn't market extensively on the Internet. Studies show that Internet buyers discount listings online that don't have photos. They assume that something must be wrong with the property. Check a sample of an agent's Internet marketing before signing up.
You may find that agents want longer than 90-day listing periods if sales are very slow in your area. This is understandable; agents typically pay for the marketing, and it's generally taking a lot longer for most homes to sell. Keep this in mind when you select your agent. You could be working with this person for some time.
THE CLOSING: A reliable source of agent recommendations is friends and associates who sold recently in your area, and would hire their agent again.
Dian Hymer is author of "House Hunting, The Take-Along Workbook for Home Buyers" and "Starting Out, The Complete Home Buyer's Guide," Chronicle Books
The Jen Team will sit down with you and devise a plan for what will work in todays market and what needs to be done to sell your home. Our honesty is our best policy and we will do our best to work with every situation or give you the alternatives you deserve to make your best informed decision before you list your home.
If you are interested in Selling or just curious about the current market conditions, call our expect listing agent Dani Miller at 480-695-2010 for a free consultation today!
Tips on choosing listing agent in today's market
By Dian Hymer Published: 11/26/2007
Save
Share
It wasn't too long ago when it didn't matter as much which real estate agent you chose to sell your house if it was located in one of the many hot seller markets. Listings sold without much assistance; many soon after the for-sale sign went up. Today, choosing the right agent for the job can make the difference between a sale and no sale.
There are many factors to consider in selecting an agent today. One is that many of the agents working now entered the business recently. They've never seen a softer home-sale market before. This doesn't mean that you shouldn't use an agent who doesn't have decades of experience. But, it means you need to find an agent with a definite set of skills.
Most sellers in this market want and need an agent that will provide an aggressive and broad-based marketing plan. However, some sellers may not be aware of how important it is to hire an agent who is an adept communicator. Today's successful agents don't stop selling when they find a buyer for your home. They manage the transaction carefully and skillfully until the sale closes.
It's not enough for an agent to promise to hold your home open every weekend until it sells. In fact, this might do more harm than good. In a slow market, a listing can be overexposed to the market and become shopworn.
The stress level of selling can be intense, particularly if property values are declining. Buyers can be demanding. You need to have confidence that your agent is representing your best interests and negotiating on your behalf in a professional manner.
Negotiating a purchase contract in this market can be an arduous endeavor. It may take multiple counteroffers back and forth to hammer out a deal. And, the fall-out rate is higher today than it was a few years ago.
Selecting an agent who is a good negotiator, who is patient and who will explore all options before letting a deal fall apart gives you a leg up. It helps if your agent has a good working relationship with other agents in the area. One of these agents is likely to represent the buyer for your home.
HOME SELLER TIP: Many agents, and real estate brokerage companies, will leave the business when they discover that they can't make enough money in the current market. Real estate agent ranks swelled immensely in recent years. For example, in California there are now 50 percent more real estate agents in the business than there were five years ago. Make sure that you work with an agent and a brokerage firm that is in the business for the long term.
Ask any agent you consider to provide you with a detailed marketing plan to let you know how he or she will accomplish the sale of your home. Don't even consider listing with an agent that doesn't market extensively on the Internet. Studies show that Internet buyers discount listings online that don't have photos. They assume that something must be wrong with the property. Check a sample of an agent's Internet marketing before signing up.
You may find that agents want longer than 90-day listing periods if sales are very slow in your area. This is understandable; agents typically pay for the marketing, and it's generally taking a lot longer for most homes to sell. Keep this in mind when you select your agent. You could be working with this person for some time.
THE CLOSING: A reliable source of agent recommendations is friends and associates who sold recently in your area, and would hire their agent again.
Dian Hymer is author of "House Hunting, The Take-Along Workbook for Home Buyers" and "Starting Out, The Complete Home Buyer's Guide," Chronicle Books
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