Austin Property Talk

Catching Up

Its been an extremely eventful 6-7 weeks for me.  But I wouldn't want it any other way. 

If you haven't had a chance to read my newsletter that I sent out recently, my cover letter gave a brief synopsis of what has been keeping me busy - including trips to Dallas to a Rangers game and Byron Nelson Golf Tournament, a tour of Central Texas wineries and most recently a trip to Washington DC to see family and check out the sites.

Read all about it here.

Second Mistake Sellers Make: Pricing based on Active Listings instead of Recent Sales

Truth of the matter is, what the house around the corner or three doors down is currently listed for has little or no bearing on what your house is worth - period. 

Mistake number 2 that sellers make is paying more attention to what other active listings are priced at rather than what the last 4-5 comparable houses actually SOLD for.  Until a house sells, its nothing more than a listing and most listings are overpriced. 

Are other listings in the neighborhood competition? Maybe, Maybe not. It depends on if they are price competitively. It depends on where they are located, upgrades, amenities, seller's motivation etc.... It is your Realtor's job to help you determine which houses are direct competition and which houses are not. 

Prior to listing a house for sale, I make an effort to tour the closest active competition and make comparative notes.  I welcome the home owner to join me in this process.  No doubt, it is important to be educated about the other homes for sale in your area.  (If your Realtor is not doing this, he/she is doing you a disservice as a seller). A buyer who comes into your neighborhood to view your house is most likely going to look at others of similar size and price.  If they like the neighborhood, they will probably choose between 2-3 and yours better be on that list. 

However, it is equally, if not more important to research and study the most recent sales in the neighborhood, paying special attention to list price to sales price ratio, days on market, levels of inventory, as well as upgrades and location of houses that are selling. 

There are numerous other variables that factor into an accurate market analysis that I will no go into here.  Pay more attention to Sold and you will be a happy Home Seller and not just a Listing. 

From the Good News Department . . .

 Based on figures released by the Austin Board of Realtors this week, Austin area Home Sales reached the Hiighest Mark since June of last year.  Last month 2135 single family homes were sold representing a 4% decrease over June 2008.  However, the 4% decrease is the smallest month over month decline since June 2007.  The year of year sales gap has been closing steadily since December 2008 - a positive sign for the market as a whole.  Pending sales for July and August were up a healthy 4% as well. 

Further evidence that the Central Texas market may have hit rock bottom - Foreclosure postings hit a 5-month low.  A decrease in Foreclosure postings is positive news for resale home prices.

You can download a full report on June 2008 home sales here.

First Mistake Sellers Make: Taking the "Test the Market Approach"

Late Spring through Late Summer is the peak season for buying and selling real estate in any market.  The timing is right for most folks to make a move during this time of the year.  As a result, Ive had numerous opportunities over the past few months to speak with homeowners about the process of selling their home. Most of the time its an education process for everyone involved, especially if the owners have not bought or sold a house in the recent past. 

I'm going to write a five part Blog about Five of the Biggest Mistakes and I encounter when working with owners who are interested in selling their home and how to avoid them. 

Mistake #1: Let's Test the Market

Plain and simple, 2009 is no longer 2006 or 2007.  The pool of ready, able and qualified buyers actively buying has dwindled.  Though there has been a steady influx of first time buyers taking advantage of the $8000 Home Buyer Tax Credit recently, the sales activity in all price ranges is not nearly what it was a couple of years ago. 

For sellers this means a number of things but most importantly it means that if the house isn't priced to sell, the owners are in for a long and bumpy ride.  If a house is not priced appropriately for the current market, its simply a listing - a house that will sit on the market for months destined for numerous price reductions.  That is if the house is to sell at all.  The current market is full of "Listings." There are the large number of houses that are for sale but are not priced To Sell.  Most often the owners are playing the game of "Test the Market."  Ironically, an overpriced listing will usually end up selling for less than it could have sold for initially had it been priced at market value in the first place. 

On the flip side, those who are committed to the process of doing whatever it takes to sell a home are more aptly "Sellers."  Sellers listen to the advice and recommendations that they are given.  Sellers are willing to take an active role in helping to sell their house.  Sellers are willing to make the sacrifice to make sure the house is staged & presented in its best light.  Sellers are willing to step outside for a 20 minute walk when someone calls to see the house on short notice. 

I tell people all the time that there is always a market for houses that are well taken care of, in good areas, and that have sellers who are committed to do what it takes.  Selling a home takes a lot of things, most notably the ability to set ego aside

. 

They Like it and They Can Afford It

Here’s a quick note to let you know how I can help you or anyone you feel comfortable introducing to me.

After checking out endless real estate ads and Internet tours of houses, first-time    buyers Beth and John were getting very discouraged.  Like most people in their situation, they were stuck between being able to afford the houses they really liked, and not necessarily liking the houses they thought they could afford.  They’d just about resigned themselves to renewing their lease when a colleague of John’s referred the couple to me.

Beth and John were eager to start looking at houses, but I suggested their first step was to discuss what about owning a home was important to each of them.  After we clarified their goals, we discussed their financial situation, and then made a list of “must haves” and “don’t wants.”  It turned out that John and Beth had very different ideas of “musts” and “dont's”!  We agreed to meet after they’d had a chance to discuss what they’d learned in our meeting, and when Beth and Dan returned they had much clearer expectations.  I helped get them pre-approved, they made an offer on the fourth house we looked at, and now they’re settling in to a home they both like — and can afford.

Who’s the next person you know who wants to take advantage of a buyer’s market?  Be sure to give me a call to discuss how we can get them started on the right path.

What could you do with an extra 2 months a Year?

Imagine what you could do with 9 weeks of vacation a year?  How much more productive could you be if you could fit 14 months of work into a 12 month schedule?  I imagine these are questions that you've probably never stopped to ponder.

Starting the first of this month and for the next 12 weeks, I've become a member of a weekly "Power Productivity" group aimed at increasing awareness, efficiency and focus in all areas of my life.  The chief aim of this past week has been to become aware of what I do in the first couple of hours of my day.  The goal is to have a definitive routine each morning to get the day off on the right foot.  Its called a Smart Start Ritual. 

As an integral part of my smart start routine, Ive decided to focus intently on establishing a set time that I get up in the morning.  This will allow me to fit the things into my schedule that I know would be of significant benefit to my well being but that I usually reserve for later "if I have time."  For me this includes, a regular predictable exercise regimen, daily stretching, journaling and spending quality time with my goals, promises and mediations. 

So for the next 30 days, 5:30am is the time that I will condition myself to roll out of bed.  That is essentially an hour earlier than I am used to getting up on a regular basis.

Why an hour?  I was doing some poking around about conditioning myself to become an early riser, and I came across this article by Steve Pavlina. (read the article here)   Upon reading this article I was awestruck by how much extra time over the course of the year one simple hour would amount to.  Its common sense really, one simple hour each day equals 365 a year which is the equivalent to roughly nine 40-hour work weeks.  Nine. Think about that, an extra 2 months of work weeks.  Obviously the time doesnt have to be spent on work.  It can just as easily be spent with family, fitness, reading, writing, being creative, or like me, a combination of all of the above.  When I think about how much more productive I can be with that extra time, it brings a smile to my face. 

That revelation alone is enough to give me the willpower to commit to rolling out of the rack one hour earlier each day. It can only get easier over time. 

Who do you Know who Would like an Extra $8000 Next Tax Season?

Just a quick note to let you know how I might help you, or anyone you would introduce to me.

Its no secret that one of the least exciting times of the year for most people is Tax Season.  For many it means paying a little extra to the government and for the lucky ones, it means a small refund.  What if this time next year, you or someone you know could enjoy an $8000 tax credit?  I’d imagine that would make doing taxes just a little bit more exciting . . . 

As you now know, the $8000 Tax Credit program for First Time Buyers and those who haven’t owned a home in 3 years is now in full swing.  In addition, interest rates for 30 year mortgages are at all time lows (some under 4.5%).  The timing could never be better for someone you know to buy their first home, whether it be a friend, family member, or even a co-worker who could use this free $8000 opportunity as their own personal "economic stimulus" package. 

Timing is crucial as this incentive expires November 31^st of this year.  I'm wondering if you can help me continue to spread the word.  I’ve put together a free report for anyone looking to gather more information.  All you have to do is go to www.AustinFirstTImeBuyer.info.

Who Am I?

I am your constant companion

I am your greatest helper or your heaviest burden.
I will push you onward or drag you down to failure.
I am completely at your command.

Half of the things you do you might as well turn over to me and I will do them
 - quickly and correctly.

I am easily managed - you must be firm with me.
Show me exactly how you want something done and after a few lessons
I will do it automatically. 

I am the servant of great people
and alas, of all failures as well.
Those who are great, I have made great
Those who are failures, I have made failures.

I am not a machine though I do work
with the precision of a machine
plus the intelligence of a person.

You may run me for profit or run me for ruin
it makes no difference to me.

Take me, train me, be firm with me, and
I will place the world at your feet.

Be easy with me and I will destroy you. 

Who am I?

I am Habit

Side note:  During yesterday's broadcast of the Arnold Palmer Invitational (Tiger won dramatically on the 72nd hole) they discussed Tiger Woods' daily regimen.  Starting at 6:00am daily with 90 minutes of weight lifting and ending at 6pm after almost 10 hours of practice.  Name anothe player on tour that works that hard - and this is perhaps the best play of all time.  Hmm . . . I wonder how he got that way?

Economists and local housing insiders predict possible housing shortage

Have you have ever heard yourself say, "If I would have just (insert your phrase of choice) back in 2001-2002, just think about where I would be today?"  The premise being that if you would have had the courage and decisiveness to take advantage of the potentially lucrative opportunities that the post 9/11 economic landscape presented, you would be much better off and further along today, three quarters of a decade later. 

The truth is, we find ourselves in much the same place today. As some sit in front of the computer or TV and watch the stock ticker run across the bottom, others are keenly aware that now is the time to act. 

One of the most puzzling remarks that I hear from time to time from those considering purchasing a home is, I don't want to buy now while the market is down. So essentially, what they are saying to themselves is, "I want to buy when; prices start to rise again, there is more competition in the market and interest rates are higher."  Flawed logic caused by fear and indecision. 

In early January, I attended the 2009 Austin Economic Housing Forecast.  It featured a panel of economists and housing industry leaders from all over the state of Texas.  The last gentleman to speak, Eldon Rude, of Austin Metro Study asked the same question that I posed at the open of this post. 

Once he was done painting a somewhat dim yet realistic picture of expected Austin market activity for the coming year, he remarked that 2009 will present some of the best buying opportunities in a long time for buyers because once supply and demand begin to readjust in early 2010 and the market rebounds from its current lull, competition is going to be much higher and the market much tighter for those looking to make a purchase. 

This past week, Community Impact, published an article, Economists and Industry Leaders Predict a Local Housing Shortage, that reiterates much the same sentiment.  Because of a severe decline in new home starts as a result of hits that most builders have taken recently, the Austin market stands to see a significant correction in 2010 as the population continues to increase and fewer homes come available for sale. 

If you haven't watched the video that I posted below, please do as it will explain in further detail why now is a great time to buy for those who are in the position to do so.

More info on claiming the First Time Buyer Tax Credit

Here is an excerpt from an article posted yesterday at Yahoo Finance called, 7 Misconceptions about the "Stimulus."  Misconception #4 deals with the time table for claiming the First Time Homebuyer Tax Credit that I mentioned in my video below. 

Misconception #4: You can't get the 2009 first-time home-buyer tax credit until you file your tax return next year.

Actually, taxpayers who buy a first home in 2009 do not need to wait until they file their 2009 return (by April 15, 2010) to benefit from the credit. To get the money into the economy faster, the federal government is giving you a choice of claiming the first-time home-buyer credit on either your 2008 or your 2009 tax return.

There's actually a way to benefit from the credit even before you buy your first home. If you plan to buy by the November 31 deadline, you can reduce your withholding on your paychecks right away. The increased take-home pay could help you with the down payment. File a new W-4 form with your employer to adjust your withholding. (And remember to re-adjust your withholding again next year.)

If you have already filed your 2008 return, you can use Form 1040X to amend it. If you purchase a first home after the 2008 tax-filing deadline of April 15, 2009, you can still claim the credit on your 2008 tax return either by requesting a six-month extension for filing your return (which doesn't extend the deadline for paying any taxes owed) or by filing an amended return.

Quick Update on the Austin Real Estate Market

Mike Stopped Struggling in Cyberspace

Here's a quick not to let you know how I can help you or anyone that you might introduce to me.

Mike is a very internet-savvy guy, so when he was ready to trade apartment living for a home of his own, he naturally turned to the internet to search for a house.  He started house hunting, calling the phone numbers that he found online, leaving a bunch of messages, spending a lot of time driving through neighborhoods, picking up flyers, leaving more messages and on and on . . . .

After several weeks of not getting his calls returned promptly, not speaking to the same person twice, and not really making any progress, he'd just about had enough and decided to put his home search on hold.

Mike was back to square one, until his co-worker, one of my clients, suggested that he contact me.  When Mike asked if I could just email information to him, I said, "you deserve more than just an email; you deserve 20 minutes to sit down with someone who will ask important questions, listen vigilantly, and craft a strategic plan for you." 

Together, we clarified exactly what Mike wanted to accomplish, and within a few months, he found a home that he loved.

Who's the next person you know who's struggling in cyberspace instead of actually buying a home?  Be sure to give me a call to discuss how we can best help them. 

You get what you pay for

The old adage of, "you get what you pay for" is becoming more and more prevalent in the real estate industry these days.  And, I'm not necessarily talking about the amount of space that you get when you buy a house.  I'm talking about the advice, the representation and the level of professionalism that you can expect in any real estate transaction.

As times get tough, more and more agents are willing and open to taking a reduced commission or fee to work with buyers and sellers - business is business.  In fact, some agents are so desperate for business that they may be willing to tell you whatever you want to hear in hopes that it might lead to a payday in some capacity.  While that may seem like a positive thing for clients, you get what you pay for.

Let me explain further.  I was previewing properties this afternoon to educate myself on a neighborhood prior to a listing appointment. Its so obvious which sellers are working with a knowledgeable and professional real estate agent and which arent. 

The first house I toured was staged nicely, it was clean, the flyer box was full and the house showed well.  It was all downhill from there.  The next houses that I looked at got progressively worse and worse culminating with a house that had a sign frame but no sign, and a broken flyer box with no flyers.  You tell me what seller in their right mind would say, 'Now thats the kind of first class service I expected when I signed my listing agreement.'

What it did have was 50 business cards on the kitchen counter of the listing agent as if to say "look at me."  Side note on the business cards:  When I walk into a house for a preview or a showing and I see piles and piles of business cards my first thought is "Man, this house has been shown a bunch and is still available, I wonder what's wrong with it."  It could be a number of things, most likely starting with price - but that's for a different day.