Are Properties in Your Market Getting Multiple Offers and Snatched Up?

I watch the news like everyone else... and hear what they are saying about the housing market... but......... over and over again, good houses are getting snatched up in my market quickly. Yes, they are either decent properties with the right price, or ones that are just priced correctly. Either way, I am finding them to be competitive. It is good news for sellers here.

I don't mind showing a prospective buyer without a pre-approval properties at least once, but I am very hesitant to do it now, because if they really like the property, and their paper work is not lined up, and the property goes under contract then every other property thereafter will be a disappointment or a compromise. Thus, I am really encouraging people to get their finances straight, before they go out and look, so that when they see "the property", they can jump on it! It seems, there is no time to waste. And with the tax credit out there for a first time home buyers, it is a really good time to take the leap and buy.

To the other Realtors® out there, I am asking the questions and taking a poll.... Are properties in your market getting multiple offers and snatched up? The poll appears on the right side on the home page of the blog. The poll will be up for two days. Thanks!

First-Time Home Buyer Tax Credit

Here is what you need to know:

1. Who is eligible? First time home buyers with modified adjusted gross income of $75,000 or less to qualify for the full credit and $150,000 for married couples, who along with their spouse have not owned a principal residence in the past three years.
   
2. When does the purchase need to be made? The home must be purchased on or after January 1, 2009 and before December 1, 2009.
   
3. What is the definition of a "First Time Home Buyer"? Someone who hasn't owned a principal residence for three years before buying a house. Owning a vacation home would not count against you. However, if your spouse owned a principal residence in the past three years, you would not qualify.
   
4. What type of purchase is the tax credit good for? A Principal Residence.
   
5. How much is the tax credit? It is 10% of the purchase price, which is capped at $8,000.
   
6. Does it have to be repaid? This Tax credit does not have to be repaid unless you sell your house in the first three years.

If you can qualify based on the above answers, it is a terrific time to buy. If there is any question in your mind about your qualification, call your tax professional for advice.

GOING GREEN

"Green" and "Organic" are words, which you hear quite often these days. I have been wanting to research and write something on the topic of a "GREEN" house or home, but have not had the time to do the research I felt necessary to get to the place I needed to be to write such a post.

A lot of what I have come across is someone trying to sell me something and not just good advice.
Today, however, I was given a gift, and was sent such an article, which I am going to link you to. It is entitled GOING GREEN WITHOUT GOING BROKE! from Safe and Sound Home Inspections. I hope there is a helpful hint here that makes a difference in your pocketbook.

Why Should You Hire a Licensed Real Estate Agent or Realtor® When Buying Real Estate?

To begin with there is a difference between a licensed agent and a REALTOR®. For example, I am licensed by the Commonwealth of Pennsylvania as a "Sales Associate". I am a Realtor®, because I am a member of the National Association of Realtors®. All licensees are not Realtors®. To become a REALTOR®, one must join the National Association of Realtors® and subscribed to a code of ethics.

The Association provides information and educational opportunities to members as a commitment to a higher level of knowledge of buying and selling real estate. In addition, I belong to the Pennsylvania Association of Realtors and the Greater Philadelphia Association of Realtors, which too are committed to a code of ethics and higher education of their agents and brokers. Anyway, there is a lot written about the above difference between licensees and Realtors®. Which should you use? Of course, I come out on the side of the REALTOR®, but will leave that to a later discussion.

My main concern, herein, is people that go out and do it on their own. It seems simple enough. Download a form, go to Staples and buy an Agreement of Sale, and you are on your way to buying a piece of property. But is it that simple? Of course not. And it gets more complicated every day.

In the last year, I had clients, who came from out of town, and bought eight properties. I had put in about eleven, low offers for them. One was accepted. It was a simple and straightforward cash purchase of a shell and went through smoothly. They did not see, however, the work that was done for them behind the scenes. So, they went out, on their own, I think banging on doors and bought seven more properties. They were all in shell condition.

Well, the one fellow was originally from Philadelphia and left Philadelphia, at a time when almost anything was negotiable. You had a Water Bill, Judgment, etc., you could negotiate it down. Well, that is not the case these days. The City wants to be paid. Now, I am not saying everything is not negotiable, but a lot of it is not. This year, I was able to negotiate two $15.00 trash tickets, which grew to $600 to $175 for a client, but it was not easy and had to get someone in the Mayor's office to help me. The legal department had actually sent me a bill for over $4,500 and insisted it all had to be paid. There were judgments that did not attach to the subject property, and I had to "go to the mattresses" to clear it up.

Anyway, and not to pick on these clients, they made major mistakes. I begged them, when I became aware of what they were going to do, to get title insurance. Without the Title Insurance, they could get saddled with all sorts of other people's problems. They did, but they took the titles with exceptions. Meaning, they took on prior owner's problems. So, they did not buy clear titles. The sellers did not pay off everything at settlement.

So, they had big water and sewer bills attached to at least one property. They thought they could go to City Hall and get the bill cut in half; they could not. It was a poor calculation on their part and meant they paid ten thousand dollars more for the property. I believe the property had about a twenty thousand dollar water and sewer bill. This property and some of the other properties with other problems, should never have been purchased, because with the additional bills, the price paid was not justified for the property in question.

They ran into other problems as well. Ultimately, they ran out of money, and decided to unload the properties. I did not take on the listings, because I knew I could not get the price they now wanted, which was typically $10,000 more for a shell (this was the price paid and bills paid + $10,000), and no work done. There was no justification, in this last year, to get a price increase like that for the property. It was the wrong time in the market and the locations not very good. I did not feel like I could get their price and felt like I would be wasting their time and mine. I suggested they put them on Craig's List.

So, they did. They received a phone call from someone, who was out to see one property. When the prospective buyer got there, the City was in the process of demolishing the property. Why? Because, when they bought the property, they did not order a Licenses and Inspections Certification. It is required when buying and selling property in Philadelphia. They would have known that there were violations and such a fate was imminent. However, until you run into trouble, it isn't really enforced by the City to get the certification. You don't need evidence of it when your deed is recorded like you do in some municipalities. So, now, they are not only left without a property, but also need to pay the city for demolishing the property, and reinforcing the adjacent properties' walls. Now, the cases described may be extreme. However, I have heard other stories like it.

What does a licensee do to spare you from these kind of aches and pains. First of all, they are working the business of buying and selling real estate every day. They know the pitfalls, and can keep you from making expensive mistakes. They can ensure that you don't miss steps in the process of buying real estate. They can represent you in negotiations to put together the best offer for a property, which includes not only price, but also insurance, mortgage, inspection, and environmental contingencies, which protect both you and your deposit monies. It is disappointing when a client uses a contingency to get out of a contract, and I have had it happened based on inspections and zoning. But I always have to make sure what is best for my client is done.

There are so many aspects to what is a simple home purchase that when using an agent, the consumer doesn't see. Did you know that if you owe support payments in Pennsylvania, you cannot buy or sell property. If you do sell the property, and the buyer unwittingly buys the property. The buyer is now saddled with the child support payment judgment against their property? In Philadelphia, a gas bill goes with the property. This bill gets terribly complicated when the property has a tenant.

Moreover, your agent can help you with financing options, grants, information on pricing in your area, and ultimately, make your purchase as stress free as possible. Your agent does not just help you "shop" for a house.

If your income taxes are anything, but very straightforward, you are likely to hire someone to do your taxes, who is current on tax laws and what can be done to give you the best result. You could scan through the IRS instructions and website to get the same result, but how long will it take you? And will you get it right? You should view such a large purchase as buying real estate similarly. You can research and get it done, but will you get it done correctly in the end? To have the representation of an agent and broker when going through the process, the result will be a better one and easier.