December was a BUSY month. Often times people think they need to wait until Spring to list but that does not seem to be the case this year. There are people out there looking and they are ready to buy. Three of my listings were gobbled up at the end of 2012. Check them out below.
621 Elbart in Webster Groves a 2 bed, 1 bath home listed for $200,000 on November 2, was under contract by November 6 and closed by December 5th.
2614 California in Fox Park a 4 bed 2.5 bath home listed for $179,900 in September, was under contract by November 21 and closed by December 20th.
3533 Oak Hill in Tower Grove South a 3 bed 1 bath home listed for $119,900 on November 8 and was under contract by November 22 and is set to close this week.
Why is this happening?
Rates are LOW which is great for buyers. For Sale inventory is also LOW which is good for sellers. NOW is the time list. Call me today if you would like the same results as the homes above!
When you call the number on the For Sale sign, you are calling the person who represents the seller. The seller’s agent’s job is to SELL that house for the HIGHEST possible sale price. If you are serious about purchasing a home, it is best to find a Realtor who will agree to represent you exclusively.
Misconception: A buyer’s agent is expensive
Reality: Buyer representation is FREE to the buyer. When a seller contracts with a listing agent, the seller is agreeing to pay a total commission to the seller’s agent. When a seller’s agent enters a listing in the MLS, that agent is agreeing to cooperate with whoever represents the buyer and therefore will pay the buyers agent from a portion of the total commission.
Misconception: I will save money if I do all the legwork myself
Reality: You can run yourself ragged calling different signs and trying to coordinate your own showings with the various sellers and agents. You will want to look at many many houses before making a decision. By retaining a buyer’s agent, you will have someone to who can coordinate multiple showings in a short period of time on your timeline. If you call the agent for each individual listing you will have to work on their timelines and meet them at the property when it is convenient for them. What do you save by coordinating your own showings? NOTHING. What does the seller’s agent gain? DOUBLE COMMISSION all while performing her fiduciary responsibility to the seller and providing no representation to you.
Misconception:All the information I want is on Zillow, Why do I need a Buyer’s Agent?
It is true there is a ton of information on the web. But when you are about to make the BIGGEST investment of your life, you need more than information. You need KNOWLEDGE. You can check the Zestimate. But did you know that on a 4-Star rating system Zillow only gives itself a single star on its ability to predict value? A buyers’s agent can help you find true comparable properties and recommend a negotiation strategy based on recent data. Can Zillow, write a persuasive letter to the seller and seller’s agent explaining why the listing price is too high? No, but your buyer’s agent can! (Please ask me for an example of how I use recent and accurate data to support my client’s offer price)
A good buyer’s agent will not SELL you anything. A good buyer’s agent will help you evaluate the inventory, teach you what to look for in each house and use all the tools in her arsenal to help you negotiate the best price and terms for you. Once under contract a good buyer’s agent will suggest inspectors and mortgage brokers and can help you evaluate insurance options. A good buyer’s agent will get you from contract to close seamlessly all while paying attention to contract details and timelines and keeping your earnest money safe. A good buyer’s agent will not rush into a sale but will help you find the right home.
Interview several agents and ask a lot of questions. And, please, put me on our list. I regularly meet with prospective buyers for a FREE buyer consultations.
When I am out on listing appointments with home owners who are considering selling their house, they often ask “When is the best time to put my house on the market?” That question becomes even more pointed at this time of year. What the home owners want to know is should they put the house on the market now or would it be better to wait until Spring when the house market is at its peak.
A Quick Quiz
Will your house be dripping in holiday decor?
Will your front yard be a menagerie of blow up snowmen, santas and reindeer?
Are you planning to have multiple in house holiday parties? Will cleanup spill over to the day after and the day after that?
Are you planning to have over-night house guests?
Will your college age son be returning with duffle bags of laundry, smelly sneakers and leaving a trail of Doritos bags in his wake?
If you answered yes to any of these, then you might want to consider waiting until you can guarantee that your house will be show ready at a moment’s notice.
What do the numbers say?
The screen shots below were taken from the MARIS member database. These market watches are compiled quarterly. The information is very general. But if we are just considering this surface level data (number of houses listed, number of houses sold, days on market etc) then, it does appear there a many more houses sold in the Spring vs. the Winter. Based on the number of sold homes for St. Louis City (563 for the 4th quarter of 2011, 632 for the 1st quarter of 2012 and 818 for the 2nd quarter of 2012) it looks like there were roughly 30% more ready, willing and able buyers walking through homes and making offers in the 2nd Quarter of 2012 vs. the 4th quarter of 2011.
This post focuses on Lafayette Square. Again, I’m only looking for habitable homes (not homes that will need substantial rehab work) and for that reason I set the lower limit of every search at $100,000. I’ll highlight the least and most expensive homes/condos in each neighborhood and pull out some basic stats: Number of units sold, high-median-low price points, average size, price/square foot and average days on market.
Stats for Residential
23 Total Sold Units
$120,000-$705,000 with a Median Sale Price of $280,000
Avg. Square Feet: 2624
Avg. $/SqFt: $121.15
Avg. Days on Market: 188
2230 Hickory: This 2 bedroom, 1.5 bath townhome was listed for $145,000 and ultimately sold for $120,000 after 315 days on market.
1515 Missouri: 5 bedrooms 3.5 baths sold for $705,000 after beginning at $1,200,000 in July of 2008.
Stats for Condos
12 Total Sold Units
$119,500-$405,000 with a Median Sale Price of $228,000
Avg. Square Feet: 1589
Avg. $/SqFt: $135.60
Avg. Days on Market: 156
1720 Chouteau #104: Was a 2 bedroom 1 bath condo in the Eden Lofts. It was listed for $127,500 and sold for $119,500 after 72 days.
1610 Mississippi Ave #M3: Had 2 bedrooms and 2 full and 2 half baths. It originally listed for $440,000 in April of 2010 and sold 231 days for $405,000.
I have some clients now who are on the fence. They don’t know if they should buy or rent. Initially they wanted to rent but were having some trouble finding what they wanted. They have a dog and want a yard but can’t find an acceptable rental that allows pets. They are looking for a larger space, preferably a single family home with at least 1.5 baths. And they want it to be nice. Apartment grade finishes just aren’t doing it for them. They are absolutely qualified to buy but just don’t know how long they will be in St. Louis which is why renting seemed more appealing at first. They will definitely be here two years and possibly five but not longer than ten. And that’s why this is a tough choice. They could buy something right now that meets their needs and suits their style for less than would spend on monthly rent. With a purchase there is down payment required and closing cost to pay when they sell. But with a rental it is possible they may have to move every year for as long as they remain in St. Louis. In the end it is really difficult to figure out which is the most economical choice.
Here is an example of their options. One to rent. Another to buy.
Here are some shots of a “private alley house”for rent on CraigsList. It is a 2 bedroom 1.5 bath home listed for $1495/month.
2927 Henrietta is home that is currently listed for $139,900. With just 3.5% down, they could move in and pay less than $1000/month.
A CNNMoney article noted that foreclosures have fallen for the 8th straight month in a row. In May 2011 filings were 33% below the same time last year. This article is quick to point out that this doesn’t necessarily mean a housing rebound. However it does suggest that those foreclosure deals may be few and far between.
Here a couple foreclosures that I recently previewed which appear to be pretty good deals.
2625 Nebraska: Located in Tower Grove East this one of the best values I have seen recently. This house sold in 2009 for $240,000 and is currently listed for $169,900. The kitchen has a center-island, updated cabinets and granite countertops. There are 4 bedrooms, 2.5 baths a master suite and 2nd floor laundry. Large deck and two-car garage out back.
2813 Shenandoah: This rowhome in Fox Park is one of the most interesting buildings in the neighborhood. It was last sold in 2006 for $219,000 and is currently listed for $110,000.
27 N Newstead: This single family home needs a little work but it is located in the Central West End. It is currently priced at $144,900. The price per square foot for this home is $82.99 while the average $/square foot for move-in ready sold homes in a 6 block area is $$131.38.
When I am getting ready to put a new listing on the market, determining the right listing price is one of the most important tasks. In order to properly price a home for sale, REALTORS® prepare a Comparable Market Analysis (CMA) for the property. The purpose of a CMA is to use historical market data — namely, similar property listings within a reasonable radius of your home that are sold, active or pending — to determine a range of estimated value in the current market conditions for your home.
Another important component in determining price, requires an understanding of the current listing inventory. The CMA does not take into account unique features of the home, updates that have been complete, or special conditions. In an effort to price the home correctly, it is important to know how the subject property stacks up to the active competition in terms of condition and updates.
Here’s a quick example:
Subject property: Tower Grove East, 2 story brick home with 2 bedrooms (one is a master suite), 2.5 baths, 2 car garage and 2nd floor laundry with 1890 square feet. Updated kitchen and baths. System updates include electric, plumbing and HVAC, new windows and newer roof. Landscaped backyard with privacy fence. Very very clean and well-kept and completely buttoned up around the edges. It was renovated and updated just 6 years ago. The new owner has done additional work since purchase including installing new bamboo floors on the second floor, ceramic tile in the bathroom and building a garage.
Search Criteria: For this search I looked at homes in Shaw, Tower Grove East, Fox Park and Tower Grove South. These neighborhoods all border one another and in my experience in working with buyers, if they are interested in one of these neighborhoods, they are generally open to looking at all of them. In order be part of this search, a home had to have between 2-3 bedrooms and at least 2.5 baths. The subject property has 2.5 baths and most homes with 2.5 baths have a MASTER SUITE. The master suite is a special feature to be taken into account when pricing. The price range was limited to $160,000-200,000.
The Sum of the Above Report:
There are 9 current active listings ranging from $164,900-$199,900. The one that is most similar (2beds/2.5baths) is priced at $179,900. It is on a busier street and does not have a garage. The average price of the active listings is $183,489.
There is one pending sale. It also has 2 beds/2.5 baths. It’s a town home vs a single family and it does not have garage. It was listed at $165,00 when someone made an offer. The selling price will remain a mystery until closing.
There are 16 sold properties on the list. Priced between $162,000-$190,500. The tough thing about the data in the sold category is that none of them are 2 bedroom homes. But the subject property has a dedicated space for an office which is usually what that third bedroom ends up being anyway. And while all of the sold properties have 3 bedrooms, not all of them have garages. A price adjustment would have to be made either way. The average price for this category is $180,731.
This is all just background. This list can be further narrowed or broadened. For instance, there is one more property that didn’t find its way on to this CMA. It is a home just a few blocks away from the subject property. 2 beds/1.5 baths and a 2 car garage.That home was on the market for 214 days and finally sold for $168,000. I viewed that home while it was on the market, so I know that the bedrooms were smaller and the quality of work was not as good. It had 1105 square feet and the subject property has 1890. The subject property has a master suite, the one that sold for 168K did not.
So what will this home be priced at? Stay tuned. It’s coming soon!
*Please note that this is NOT the process for appraisals. That process is much more detailed and has to conform to the lending guidelines. The above just notes the first steps in determining listing price.
Below is a Guest Post from James Kelley regarding Govenrment Backed Loans
Although requirements for conventional home loans and even government-backed mortgage
plans have become stricter, three programs continue to remain buyers’ favorites and offer a
multitude of incomparable benefits: FHA, USDA and VA loans. With decent credit scores and debt to income ratios, the unique opportunities provided through these three programs increase. However, they are also known for being prime home loan programs that help low income families achieve their dreams of homeownership. What do they offer and how
can they help?
FHA and USDA Loans
For USDA loans, the U.S. Department of Agriculture secures them. So, only homes within rural localities can be bought with this mortgage program. Different from the FHA, it does not require a down payment. The FHA loan asks for a 3.5% to 5% down payment on a home, and conventional loans can be up to 20% and more. Other perks include 100% financing, no monthly mortgage insurance fees, and the actual mortgage payment is sometimes lower than the FHA loan. There are household income limits for the USDA loan.
The Federal Housing Administration insures the FHA loan. Unlike the VA and USDA loan, the FHA has no location or vocation requirements. It’s open to everyone.An FHA loan has lower closing costs and no income limits, which is ideal for lower to middle income families. Another great feature of all three programs alike is the buyer can use gifted or borrowed money towards payment of the home. Times are hard, and sometimes people need to go to relatives or friends for a little financial help. Conventional loan programs will not allow such assistance.
The VA loan program is a unique plan for service members. Not many U.S. Veterans utilize or even know about the Department of Veteran Affairs offer to back a home loan for them. In a few short years, the loan has gained increased popularity among lenders.
• A stress-free process
• 100% financing
• Less strict credit and income standards than conventional loans
• No prepayment penalties or private mortgage insurance payments
• A buyer can receive a loan up to $417,000
It’s been a good year for veterans. An extension on the tax credit, plus the U.S. Department
of Housing and Urban Development’s efforts to provide affordable housing to eligible military
members makes now a great time to buy a home.
How to obtain a VA Loan
• A veteran must be able to show that he or she was honorably discharged, or served at
least 90 days on active duty during war or 181 days on active duty during a time of peace.
• One may also be determined eligible if one is a spouse of veteran who is missing in
action, a prisoner of war or died from service related events.
• Find a VA Lender.
• Fill out a Certificate of Eligibility form.
• Find a certified <a href=”http://www.stlouishomeappraiser.com/”>home appraiser</a>.
• In most counties, the VA only secures half of the loan.
• They are not open to everyone. You have to be a veteran.
• In most cases, there will be a small funding charge.
All three programs can help one’s family to potentially obtain their dream home. However, pay
close attention and research which program will save the most money. A lending counselor can
help families to discover their options.
I read an article yesterday that found a silver lining for those who are thinking of buying but missed the deadline for the $8000 tax credit. Three points to consider were lower interest rates, builder incentives for new construction and the decreasing of list price by home sellers.
On that note, I did a quick search of our MLS to see what happened to the price of homes in a couple St. Louis City neighborhoods. I performed a general search of the zip codes 63116, 63118 and 63104 for homes that are currently listed between $150,000-$300,000.
I found 178 ACTIVE listings in this price range. Next I went through the data and separated the homes by days on market. The deadline for contract acceptance to receive the tax credit was April 30,2010. So I looked for homes that had been on the market for at least 68 days. Of the 178 current actives, 113 of those have been on the market for at least 68 days. Of the 113 that have been on since before the end of the tax credit, 80 have had price reductions, 32 have remained at the original list price and one price actually increased.
Of the 113 that have been on the market longer than 68 days and have reduced their sale prices, I picked four that I have already walked through to highlight below. The four that I picked were ones that were in the top running for some my clients.
2215 Sidney was $215,000 when I looked at it with some of my clients. The couple I was with loved this house and it was their top choice until they found another home that had a two car garage. The home they ultimately bought was listed at $238,000. At the current list price of $189,000, I think 2215 Sidney is a great house for the price.
2647 Russell When I looked at this house, I was impressed with its size, location and two car garage. Now that the listing price has dropped by $20,000, I think it is a steal! Currently listed for $225,000 its a good find in Fox Park. Close to highways and walkable to Lafayette Square.
2012 James was listed at $235 when I walked through it. Since then it has decreased to $225,000. James is a short street tucked into the Benton Park neighborhood and walkable to the new Bittersweet Bakery on Gravois and Blues Cit Deli. The finish quality of the rehab is outstanding and the home has just enough space, a private yard and one car garage.
2745 Accomac This is an amazing rehab! The quality of the construction in this home and high level finish is really hard to find. Before the tax credit the home was listed for $253,000 and it is currently listed for $249,900.
This post was written by a guest blogger Mark Anderson who is a loan office with Pulaski Bank. He specializes in helping first time home buyers through what can often be a very confusing process. He considers himself more of a consultant than a salesperson. He takes client education seriously and his level of customer service is unmatched. If you have any questions about this post or home financing in general please check out his business website.
Effective January 1, 2010, Congress instituted new rules regarding the Good Faith Estimate. Geared toward shutting down predatory lending practices, the rules make it nearly impossible for a mortgage company to quote one set of fees at application and deliver something different at closing.
While the aim is good, the law of unintended consequences has already come into play. Shopping for the best mortgage will now be more difficult and more complicated.
I have often complained about the old Good Faith Estimate and I agree that a change was important. The form had to meet some basic standards, but overall, comparing apples to apples was not easy if you didn’t know what to look for. The old Good Faith Estimate itemized all of the fees associated with a loan closing, including third party charges ultimately not determined by the lender. Lenders could make their bottom line appear artificially attractive by estimating third party fees low. Also, lenders used a variety of confusing, sometimes downright deceptive terms to hide the true cost of their own services. For example, while ‘Tax Service Fee’ sounds like a government imposed charge, it could be $50, $500 or really any number the lender felt like imposing. Maybe some of the fee actually was paid to request tax return transcripts, but I routinely saw my competitors charging outlandish amounts which clearly were not legitimate third party costs.
For this reason, I encouraged my clients to isolate the lender fees and compare those against other quotes, without regard to the varying estimates for third party charges. If the loan officer refused to itemize the actual lender fees, I advised people to walk away.
The new Good Faith Estimate is great in that the true lender cost is reflected very clearly and separated from third party fees. It is now referred to as the ‘cost of origination’. While I am happy with this change, there is a fundamental flaw to the new GFE: lenders are not going to issue them until you select them as your lender. This is because the lender now has a legal responsibility to be so precise that it is simply impractical to issue the form before you file a full application and have a property officially under contract.
The good news here is that once you have selected a lender, made your application and gone under contract, you will receive a Good Faith Estimate that will be amazingly close to the final number at closing. However, since it is impractical for the lender to issue a GFE ahead of time, how can you really shop for the best deal before making a commitment?
Unfortunately lenders will now provide informal quotes that don’t have to meet any government standards. At least the old Good Faith Estimate looked fairly similar from lender to lender. Now, borrowers are going to be faced with such a variety of quote sheets that it will be that much more difficult to compare them.
Despite the problems the new GFE causes with initial disclosure from your lender, you can still exercise control over the quote process in much the same way I recommended before January 1. While the quotes will look different and while they might not be a very good reflection on the actual costs, you can still demand that your lender tell you what they charge.
My main concern with this whole new process is that there was at least some regulation of the old Good Faith Estimate. Now, as a consumer, you will simply have to exert your knowledge as power and show your lender you are aware of the recent changes. Let them know you are also aware that you will always have the ability to move to another lender if their non-regulated initial quote looks much more attractive than the formal GFE.
Dawn Griffin Real Estate Blog
I’m an experienced Saint Louis Realtor specializing in St. Louis City as well as neighborhoods like Webster Groves, Maplewood, Clayton, University City and Ladue. With an undergraduate degree in Education and Master's in Urban Planning and Real Estate Development — I have the heart of teacher.
I have been immersed in Residential Real Estate, helping home buyers and sellers understand the market, manage the ambiguities and negotiate the best terms for themselves. I am consistently voted a 5-Star Agent by clients and featured as one of St. Louis' Best Agents in Saint Louis Magazine.