Sales of existing homes rose from January to February in an unexpected boost for the slumping U.S housing market as buyers took advantage of deep discounts on foreclosures.
The National Association of Realtors said Monday that sales of existing homes grew 5.1 percent to an annual rate of 4.72 million last month, from 4.49 million units in January. It was the largest sales jump since July 2003.
Sales had been expected to fall to an annual pace of 4.45 million units, according to Thomson Reuters.
The median sales price plunged to $165,400, down 15.5 percent from $195,800 a year earlier. That was the second-largest drop on record.
February's median sales price was up slightly from January, which recorded the lowest median price since September 2002. Prices are down about 28 percent from their peak in July 2006.
In contrast with the housing boom, when buyers took out ever-riskier loans and maxed out their home equity lines, "homebuyers are not over stretching" said Lawrence Yun, the Realtors' chief economist. "They want to stay within their budget."
By summertime, sales are expected to get a boost from a $8,000 tax credit for new home buyers included in the economic stimulus package signed by President Barack Obama last month.
The number of unsold homes on the market last month rose 5.2 percent to 3.8 million, a typical increase for the winter months. At February's sales pace, it would take 9.7 months to rid the market of all of those properties, unchanged from a month earlier.
The bursting of the U.S. housing bubble has caused foreclosures to swamp the market _ especially in particularly distressed states like California, Florida, Nevada and Arizona.
About 45 percent of sales nationwide are foreclosures or other distressed property sales, according to the Realtors group. Those properties typically sell for about 20 percent less than non-distressed homes.
That's great news for buyers, who are paying the most attractive prices in years. Plus, interest rates have sunk to historic lows.
The Federal Reserve last week moved to reduce already low rates by printing $1.2 trillion and pumping it into the economy through the purchases of mortgage-backed securities and Treasury debt.
The central bank also will double its purchases of debt issued by Fannie Mae and Freddie Mac to $200 billion.
Monday, March 23, 2009
Monday, March 2, 2009
This week brings us the release of six economic reports to be concerned with. Two of the reports are considered to be very important, but nearly all of the week's releases have the potential to affect mortgage rates. With reports being posted each day except Tuesday, we will likely see a fairly active week in mortgage rates.
The week's first data comes tomorrow morning with the release of two relevant reports. The first is January's Personal Income ad Outlays data at 8:30 AM ET, which gives us an indication of consumer ability to spend and current spending habits. Current forecasts call for a decline in income of 0.2% while spending is expected to rise 0.42%. A larger than expected increase in spending would be bad news for the bond market and could drive mortgage rates higher. Weaker than forecasted numbers should help push mortgage rates slightly lower tomorrow.
The Institute for Supply Management (ISM) will release their manuf acturing index for February late tomorrow morning. This index measures manufacturer sentiment and can have a pretty large impact on the financial and mortgage markets if it varies from forecasts. It is expected to show a decline from January's 35.6 to 34.0 last month. This is important because a reading below 50.0 is a recession indicator, meaning that more surveyed manufacturers felt business worsened during the month than those who felt it had improved. If we see a weaker than expected reading, the bond market could rally. However, a higher than forecasted reading could lead to major selling in bonds, causing mortgage rates to rise.
The Fed Beige Book is the next report scheduled for release and it will be posted Wednesday afternoon. This report details economic activity throughout the country by region. The Fed relies heavily on this data during their FOMC meetings, so look for a potential reaction during afternoon trading Wednesday. It probably will not cause a major sell off in the stock or bond markets, but could cause enough movement in bond prices to possibly improve or worsen mortgage rates slightly if it reveals any significant surprises.
There two reports scheduled for release Thursday morning. The first is the revised Productivity index for the 4th Quarter of last year. The preliminary reading posted last month showed an annual rate of 3.2% increase in worker output. Analysts are expecting to see a sizable downward revision to the initial reading. It is expected to be cut to a 1.6% increase in output, meaning workers were not as productive as previously thought during the quarter. Employee productivity is watched fairy closely because a higher level of output per hour is believed to mean that the economy can expand without inflation concerns.
January's Factory Orders will be posted late Thursday morning, which will give us a measurement of manufacturing sector strength. This data is similar to last week's Durable Goods, except this report covers orders for both durable and non-durable goods. Current forecasts are calling for a drop in new orders of approximately 2.1%. A larger than expected drop would be good news for the bond market and could lead to an improvement in mortgage rates.
The biggest news of the week comes Friday morning when one of the single most important monthly reports we see will be posted. The Labor Department will release February's Employment report at 8:30 AM ET Friday. Some of the important portions of the report will give us the unemployment rate, number of new jobs added or lost and the average hourly earnings reading. The best combination for the bond market and mortgage rates would be an increase in the unemployment rate, a large drop in payrolls and little or no increase in earnings. Current forecasts are calling for 0.3% increase in the unemployment rate to 7.9% and approximately 615,000 jobs lost during the month.
Overall, look for a fairly active week for mortgage rates. I suspect there will be some optimism leading up to Friday's Employment report, which is of concern to me. I believe the market is expecting to see very weak numbers Friday morning and has already built that into current pricing. The problem is that if it meets forecasts, or is even slightly stronger than expected, we could see bonds drop and mortgage rates rise. Because of this, I may be extending the lock recommendation to longer periods before Friday's data. Friday is undoubtedly the biggest day of the week, but tomorrow may also bring noticeable movement in mortgage rates.
The week's first data comes tomorrow morning with the release of two relevant reports. The first is January's Personal Income ad Outlays data at 8:30 AM ET, which gives us an indication of consumer ability to spend and current spending habits. Current forecasts call for a decline in income of 0.2% while spending is expected to rise 0.42%. A larger than expected increase in spending would be bad news for the bond market and could drive mortgage rates higher. Weaker than forecasted numbers should help push mortgage rates slightly lower tomorrow.
The Institute for Supply Management (ISM) will release their manuf acturing index for February late tomorrow morning. This index measures manufacturer sentiment and can have a pretty large impact on the financial and mortgage markets if it varies from forecasts. It is expected to show a decline from January's 35.6 to 34.0 last month. This is important because a reading below 50.0 is a recession indicator, meaning that more surveyed manufacturers felt business worsened during the month than those who felt it had improved. If we see a weaker than expected reading, the bond market could rally. However, a higher than forecasted reading could lead to major selling in bonds, causing mortgage rates to rise.
The Fed Beige Book is the next report scheduled for release and it will be posted Wednesday afternoon. This report details economic activity throughout the country by region. The Fed relies heavily on this data during their FOMC meetings, so look for a potential reaction during afternoon trading Wednesday. It probably will not cause a major sell off in the stock or bond markets, but could cause enough movement in bond prices to possibly improve or worsen mortgage rates slightly if it reveals any significant surprises.
There two reports scheduled for release Thursday morning. The first is the revised Productivity index for the 4th Quarter of last year. The preliminary reading posted last month showed an annual rate of 3.2% increase in worker output. Analysts are expecting to see a sizable downward revision to the initial reading. It is expected to be cut to a 1.6% increase in output, meaning workers were not as productive as previously thought during the quarter. Employee productivity is watched fairy closely because a higher level of output per hour is believed to mean that the economy can expand without inflation concerns.
January's Factory Orders will be posted late Thursday morning, which will give us a measurement of manufacturing sector strength. This data is similar to last week's Durable Goods, except this report covers orders for both durable and non-durable goods. Current forecasts are calling for a drop in new orders of approximately 2.1%. A larger than expected drop would be good news for the bond market and could lead to an improvement in mortgage rates.
The biggest news of the week comes Friday morning when one of the single most important monthly reports we see will be posted. The Labor Department will release February's Employment report at 8:30 AM ET Friday. Some of the important portions of the report will give us the unemployment rate, number of new jobs added or lost and the average hourly earnings reading. The best combination for the bond market and mortgage rates would be an increase in the unemployment rate, a large drop in payrolls and little or no increase in earnings. Current forecasts are calling for 0.3% increase in the unemployment rate to 7.9% and approximately 615,000 jobs lost during the month.
Overall, look for a fairly active week for mortgage rates. I suspect there will be some optimism leading up to Friday's Employment report, which is of concern to me. I believe the market is expecting to see very weak numbers Friday morning and has already built that into current pricing. The problem is that if it meets forecasts, or is even slightly stronger than expected, we could see bonds drop and mortgage rates rise. Because of this, I may be extending the lock recommendation to longer periods before Friday's data. Friday is undoubtedly the biggest day of the week, but tomorrow may also bring noticeable movement in mortgage rates.
Wednesday, February 18, 2009
5 Tips for Homebuyers Seeking a Mortgage Here’s a warning for potential borrowers:
Nervous lenders have tough new rules and are paperwork crazy."Borrowers are going to have to prove they are the borrower they say they are," says Keith Gumbinger, vice president of HSH Associates, a mortgage-industry publisher in Pompton Plains, N.J.Gumbinger says homebuyers should consider these things before they apply for a loan.
1. Down payments are critical. Borrowers should expect to put down at least 10 percent for a “conforming loan” – a mortgage that Fannie Mae and Freddie Mac will purchase.
2. Credit scores count. A 720 on the 850-point FICO rating scale will get a borrower access to the best rates. Rich Bira, branch manager of FCM Direct Lender in Chicago, says: "A score between 720 and 739 gets 0.125 percent added to the rate, a score between 700 and 719 gets 0.375 percent added to the rate, and a score between 680 and 699 gets 0.5 percent added to the rate.”
3. Consider VA and FHA. Borrowers without down payments or with less than stellar credit scores should consider these government-insured loans offered through the Federal Housing Administration of the Veterans Administration.
4. Unearth the records. Before applying, borrowers should organize tax, banking and other records that prove income, savings and debts. They should also expect to be patient about what may seem to be endless requests for information.
5. Get rid of debts. Limiting debts, including what borrowers expect to pay for the mortgage, to less than 43 percent of gross income is important
Nervous lenders have tough new rules and are paperwork crazy."Borrowers are going to have to prove they are the borrower they say they are," says Keith Gumbinger, vice president of HSH Associates, a mortgage-industry publisher in Pompton Plains, N.J.Gumbinger says homebuyers should consider these things before they apply for a loan.
1. Down payments are critical. Borrowers should expect to put down at least 10 percent for a “conforming loan” – a mortgage that Fannie Mae and Freddie Mac will purchase.
2. Credit scores count. A 720 on the 850-point FICO rating scale will get a borrower access to the best rates. Rich Bira, branch manager of FCM Direct Lender in Chicago, says: "A score between 720 and 739 gets 0.125 percent added to the rate, a score between 700 and 719 gets 0.375 percent added to the rate, and a score between 680 and 699 gets 0.5 percent added to the rate.”
3. Consider VA and FHA. Borrowers without down payments or with less than stellar credit scores should consider these government-insured loans offered through the Federal Housing Administration of the Veterans Administration.
4. Unearth the records. Before applying, borrowers should organize tax, banking and other records that prove income, savings and debts. They should also expect to be patient about what may seem to be endless requests for information.
5. Get rid of debts. Limiting debts, including what borrowers expect to pay for the mortgage, to less than 43 percent of gross income is important
Friday, February 13, 2009
Info on the stimulus plan
The Economic Stimulus Bill (The American Recovery and Reinvestment Act of 2009, H.R. 1.) has been reconciled by the House and Senate. The details of the legislation have not been finalized but we expect the legislation to include a number of important housing provisions, including the remedies for the housing crisis that NAR prescribed at the annual meeting in Orlando, Florida.
Homebuyer Tax Credit – An $8000 tax credit that will be available for qualified purchase of a principal residence by a first time homebuyer between January 1, 2009 and September 1, 2009. The credit does not require repayment. Individuals who purchase in 2009 using financing assistance from state and local mortgage bonds will be permitted to use the credit, as well.
· FHA, Fannie and Freddie Loan Limits – Revised loan limits for FHA, Freddie Mac, and Fannie Mae. Specifics have not been released but reports indicate that the 2008 limits have been reinstated for 2009 except in those communities where the 2009 limits are higher. Additional increases in individual communities may also be available at the discretion of the HUD Secretary.
· Foreclosure Mitigation & Neighborhood Stabilization – Funding for states and local communities to be used for neighborhood stabilization activities for the redevelopment of abandoned and foreclosed homes are authorized.These elements of the American Recovery and Reinvestment Act of 2009 are the pillars of the NAR Housing Stimulus Plan presented to the 111th Congress. As the leading advocate for homeowners and the real estate industry, the National Association of REALTORS will continue to address the issues facing Americans who are trying to purchase a new home, protect their current home or preserve investment opportunities in residential and commercial properties.
Homebuyer Tax Credit – An $8000 tax credit that will be available for qualified purchase of a principal residence by a first time homebuyer between January 1, 2009 and September 1, 2009. The credit does not require repayment. Individuals who purchase in 2009 using financing assistance from state and local mortgage bonds will be permitted to use the credit, as well.
· FHA, Fannie and Freddie Loan Limits – Revised loan limits for FHA, Freddie Mac, and Fannie Mae. Specifics have not been released but reports indicate that the 2008 limits have been reinstated for 2009 except in those communities where the 2009 limits are higher. Additional increases in individual communities may also be available at the discretion of the HUD Secretary.
· Foreclosure Mitigation & Neighborhood Stabilization – Funding for states and local communities to be used for neighborhood stabilization activities for the redevelopment of abandoned and foreclosed homes are authorized.These elements of the American Recovery and Reinvestment Act of 2009 are the pillars of the NAR Housing Stimulus Plan presented to the 111th Congress. As the leading advocate for homeowners and the real estate industry, the National Association of REALTORS will continue to address the issues facing Americans who are trying to purchase a new home, protect their current home or preserve investment opportunities in residential and commercial properties.
Wednesday, February 11, 2009
With the weather breaking here in the Philadelphia area, most people begin to think of spring. As most people know spring is the busiest season for the real estate market. As a buyer, you want to be prepared to purchase that dream home. One of the things you can do right now to get ready is take a look at your credit score to find out if you will get the best rates for a mortgage. I am often times asked what factors help/hinder scores. So the following is some useful info:
Credit scores range between 200 and 800, with scores above 620 considered desirable for obtaining a mortgage.
The following factors affect your score:
1. Your payment history. Did you pay your credit card obligations on time? If they were late, then how late? Bankruptcy filing, liens, and collection activity also impact your history.
2. How much you owe. If you owe a great deal of money on numerous accounts, it can indicate that you are overextended. However, it’s a good thing if you have a good proportion of balances to total credit limits.
3. The length of your credit history. In general, the longer you have had accounts opened, the better. The average consumer's oldest obligation is 14 years old, indicating that he or she has been managing credit for some time, according to Fair Isaac Corp., and only one in 20 consumers have credit histories shorter than 2 years.
4. How much new credit you have. New credit, either installment payments or new credit cards, are considered more risky, even if you pay them promptly.
5. The types of credit you use. Generally, it’s desirable to have more than one type of credit — installment loans, credit cards, and a mortgage, for example.
For more on evaluating and understanding your credit score, visit www.myfico.com.
Credit scores range between 200 and 800, with scores above 620 considered desirable for obtaining a mortgage.
The following factors affect your score:
1. Your payment history. Did you pay your credit card obligations on time? If they were late, then how late? Bankruptcy filing, liens, and collection activity also impact your history.
2. How much you owe. If you owe a great deal of money on numerous accounts, it can indicate that you are overextended. However, it’s a good thing if you have a good proportion of balances to total credit limits.
3. The length of your credit history. In general, the longer you have had accounts opened, the better. The average consumer's oldest obligation is 14 years old, indicating that he or she has been managing credit for some time, according to Fair Isaac Corp., and only one in 20 consumers have credit histories shorter than 2 years.
4. How much new credit you have. New credit, either installment payments or new credit cards, are considered more risky, even if you pay them promptly.
5. The types of credit you use. Generally, it’s desirable to have more than one type of credit — installment loans, credit cards, and a mortgage, for example.
For more on evaluating and understanding your credit score, visit www.myfico.com.
Monday, February 9, 2009
A Realtor Manifesto
Ordinarily, this blog is meant to stimulate thought provoking discussion and to educate the average "Joe the plumber-Consumer". However, today I feel I need to discuss a Realtor Call To Arms.
Every industry, I suppose, has their bad seeds that grow into weeds. The manifestation of these weeds are the negative stereotypes about the industry as a whole. For instance, is every used car salesman "slimy", or is it just a few? Are ALL politicians crooks? Or just a few? Real Estate is no different. We have a few agents out there, that single handedly cast a shadow over the rest of our brethren. I say we need to put a stop to these agents that act unethically and unprofessionally. Clearly, this needs to be a grass roots movement, since their Brokers do not seem to want to do anything about the agents they "hire". This weekend showcased for me THREE(!) separate incidents of agents not doing their jobs, ultimately reflecting negatively upon all of us.
The three incidents happened like this (names will be removed to protect the not-so-innocent and keep my butt out of the defendants chair):
I begin by trying (Called to schedule Friday Jan 30, G-D forbid I don't give enough notice to show)to re-show a home to buyers who were ready, willing and able to write an agreement on said home on January 31, 2009. I was unable to show the home because the agent did not return a phone call until Sat around 5pm! This deserves some emphasis, it took over 24 hours for an agent to call me back for a re-show!! So he let me re-show on Sunday and promptly called for feedback (ha!). I spoke to the agent on Sunday evening and asked for a Seller's Disclosure and expressed my buyers intent to write an agreement. As we agents (should) do, asked if there was another agreement possibly coming in or if there seemed to be any other interest in the home from any other prospective agents (or their principals). I was given a negative response to both. I advised that we will be writing up the deal in the early part of the week. No Seller's Disclosure sent Monday and it was not sent until Tuesday around noon. I looked it over and of course it was incomplete.
- Let me pause and digress, Agents: LOOK AT WHAT YOUR SELLERS HAVE WRITTEN! YOU WILL BE QUESTIONED ON IT!!-
I called and left a message with the agent on Tuesday around noon, no return phone call. I called Wednesday, no return phone call. Finally, I meet with my buyers Wednesday evening, write up an aggressive offer and email it to the agent (since I cannot seem to get a response, maybe this will wake him up). Like a High School Crush, I wait and hope that I will get a phone call on Thursday. NOPE! So once again like an unrequited lover, I call him to find out he did receive the agreement and will present this evening. I receive a counter offer via email around 6pm (he's ALIVE!). I speak to my buyers and they assent to the sellers terms. The sellers agent writes back that we have a deal and will email me Friday the signed agreement with the initialed changes. Great! Friday at 3pm I receive an email that there was a second showing on Sunday (what happened to his negative response about no other interested parties?) and those people are bringing an offer on Sat., and that he is sorry for the delay, but his sellers want the best deal possible for themselves, so they are going to hold off executing?!?!?!?!
Again let me digress here, AGENTS: There is a clause in an agreement of sale that reads something like this: TIME IS OF THE ESSENCE. Now, in the famous words of Mr. Tom Fenerty "It takes more education to cut someone's hair then it does to become a licensed Real Estate Agent." So I will explain, That is a legal term of art, it means the dates on the agreement are to be adhered to strictly!
That does not mean you can take your time to disregard a date and sign when you feel you are ready too. The agent did not even have the courtesy to call me, he sends an email. Passive aggressive behavior only frustrates a deal. Let us not hide behind a computer, let us communicate freely and openly so that we can all accomplish our mutual goal. I call him several times, to no avail. I call his broker, also no answer. I talk to my broker, who then calls his broker (My daddy is going to beat up your daddy). The other broker answers this time and I convey my frustration and politely explain that the sellers have until this evening or our deal is off the table. No response from broker, other than "ok, did you call the agent." -Oh! That's what I forgot to do! YES, I have tried several times. -His response, "ok, do you want me to try him?" Needless to say, I received a phone call later on to which the agent explained that he did not present the offer to his principal (or even went to meet him in fact), but was negotiating through the principal's wife the day before!!!! When asked why he did not meet with the principal when he was supposed to and have them sign and initial changes, he said he doesn't do that because he has had knee surgery so he is not mobile.
AGENTS: YOU HAVE TO PRESENT OFFERS TO YOUR PRINCIPALS, NOT THEIR WIVES OR AUNTS OR COUSINS! AND WHEN YOU PRESENT, IT MAY BE A GOOD IDEA TO DO IT IN PERSON AND MAYBE EXPLAIN TO THEM WHAT THEY ARE SIGNING!!
I was told he will try and have my deal executing Friday night, needless to say, I never heard back.
Saturday, I have appointments scheduled from the day before (I am a good boy scout I always try to schedule the day before). I have one property scheduled from 2-3pm. We show the home at about 2:15ish? My buyer loves the home and wants to write up an offer. I get in my car and the phone rings, it is from the centralized appointment center -not from the agent- they are cancelling my showing from 2-3pm, because they have signed off on another agreement! It's 245 at this point!!
AGENTS: YOU KNOW WHEN A DEAL IS COMING IN, YOU ALSO KNOW WHEN YOU HAVE APPTS SCHEDULED. ARE YOU REALLY DOING YOUR SELLERS A SERVICE BY NOT WAITING TO EXECUTE UNTIL YOU HEAR FROM THE PEOPLE SHOWING THAT DAY? OR HOW ABOUT YOU CALL THE SHOWING AGENT YOURSELF AND LET THEM KNOW A DEAL IS COMING IN THAT DAY? OR HOW ABOUT CALLING TO CANCEL BEFORE WE WASTE OUR TIME? OUR APPT WAS 2-3, WHY AM I GETTING CALLED AT 245??
In the interim, I was scheduling showings for Sunday (same buyers from the Friday agreement fiasco), and received confirmation for both homes. Well, sort of. The second confirmed, but did not provide information on how to access the home other then instructions that I had to call the listing agent before showing. So I called about 30 minutes before showing it, no answer from the listing agent. I leave a detailed message about why I am calling and that I do not have any idea about how to access the home. No return call! I show the first home and call the agent again, NO ANSWER! We arrive at the home and now my buyer takes it upon herself to call the listing agents office herself. She is extremely frustrated with all the events she has been through in the last 48 hours. The receptionist also cannot get in touch with the listing agent! I call centralized showing desk again and they do not have any lockbox info and also cannot get in touch with the agent. Finally, 40 min after we were scheduled to show, the agent call me back and gives me the lockbox combo! He wants to know why I am frustrated also? I believe his exact words were "Why are you barking at me?" How about the fact that you cannot do your job, which effects me doing my job properly?!
AGENTS: DO NOT MAKE YOUR JOB HARDER, IF YOU HAVE A VACANT HOME THAT YOU INTEND ON JUST GIVING OUT A LOCKBOX COMBO TOO, PROVIDE IT TO WHEREVER AGENTS ARE SUPPOSSED TO CALL TO SCHEDULE!
So let me sum up my goals for all of us agents (please feel free to add on or comment):
1 We are NOT adversaries, leave that to the lawyers, we have a mutual goal, to get our respective clients to settlement as painlessly as possible.
2 Return phone calls. There are only so many times we can make excuses for each other as to why we are not getting return calls (Are we not in a down market? Why aren't agents chomping at the possibility of a deal coming in?)
3 Whatever your religious persuasion is, the rule is the same and incorporated into every religion and culture. Treat others the same way you want to be treated. Respect each other.
4 Know what you are having your clients sign and make sure they understand it.
5 When presenting an offer, present to the person(s) who have the authority to act. Your Principal(s).
6 Do not make your jobs more difficult then they need to be, provide all relevant showing information to your respective appointment centers. Agents do not want (or need) to jump through hoops to show your listing. And are you acting in your sellers best interest by making it more difficult to show?
7 Sometimes it is our clients that make us act the way we are acting. But we need to educate our clients about the process, so that they understand that when they make it difficult to show their home or whatever, they are only adding to their own difficulties of accomplishing the goal of buying or selling their home.
8 When you ask for feedback, please do not sell me on your property or argue with me about why my buyer's opinion (or mine) is incorrect. That only leads to not wanting to provide feedback.
9 Provide feedback.
10 It is ok that you are only a "part-time" agent. I know that there is a stigma about it, but let's get over it. Just let us know ahead of time, so that we are prepared for the possibility that we can only communicate certain ways/times and we can only settle certain days/times.
Every industry, I suppose, has their bad seeds that grow into weeds. The manifestation of these weeds are the negative stereotypes about the industry as a whole. For instance, is every used car salesman "slimy", or is it just a few? Are ALL politicians crooks? Or just a few? Real Estate is no different. We have a few agents out there, that single handedly cast a shadow over the rest of our brethren. I say we need to put a stop to these agents that act unethically and unprofessionally. Clearly, this needs to be a grass roots movement, since their Brokers do not seem to want to do anything about the agents they "hire". This weekend showcased for me THREE(!) separate incidents of agents not doing their jobs, ultimately reflecting negatively upon all of us.
The three incidents happened like this (names will be removed to protect the not-so-innocent and keep my butt out of the defendants chair):
I begin by trying (Called to schedule Friday Jan 30, G-D forbid I don't give enough notice to show)to re-show a home to buyers who were ready, willing and able to write an agreement on said home on January 31, 2009. I was unable to show the home because the agent did not return a phone call until Sat around 5pm! This deserves some emphasis, it took over 24 hours for an agent to call me back for a re-show!! So he let me re-show on Sunday and promptly called for feedback (ha!). I spoke to the agent on Sunday evening and asked for a Seller's Disclosure and expressed my buyers intent to write an agreement. As we agents (should) do, asked if there was another agreement possibly coming in or if there seemed to be any other interest in the home from any other prospective agents (or their principals). I was given a negative response to both. I advised that we will be writing up the deal in the early part of the week. No Seller's Disclosure sent Monday and it was not sent until Tuesday around noon. I looked it over and of course it was incomplete.
- Let me pause and digress, Agents: LOOK AT WHAT YOUR SELLERS HAVE WRITTEN! YOU WILL BE QUESTIONED ON IT!!-
I called and left a message with the agent on Tuesday around noon, no return phone call. I called Wednesday, no return phone call. Finally, I meet with my buyers Wednesday evening, write up an aggressive offer and email it to the agent (since I cannot seem to get a response, maybe this will wake him up). Like a High School Crush, I wait and hope that I will get a phone call on Thursday. NOPE! So once again like an unrequited lover, I call him to find out he did receive the agreement and will present this evening. I receive a counter offer via email around 6pm (he's ALIVE!). I speak to my buyers and they assent to the sellers terms. The sellers agent writes back that we have a deal and will email me Friday the signed agreement with the initialed changes. Great! Friday at 3pm I receive an email that there was a second showing on Sunday (what happened to his negative response about no other interested parties?) and those people are bringing an offer on Sat., and that he is sorry for the delay, but his sellers want the best deal possible for themselves, so they are going to hold off executing?!?!?!?!
Again let me digress here, AGENTS: There is a clause in an agreement of sale that reads something like this: TIME IS OF THE ESSENCE. Now, in the famous words of Mr. Tom Fenerty "It takes more education to cut someone's hair then it does to become a licensed Real Estate Agent." So I will explain, That is a legal term of art, it means the dates on the agreement are to be adhered to strictly!
That does not mean you can take your time to disregard a date and sign when you feel you are ready too. The agent did not even have the courtesy to call me, he sends an email. Passive aggressive behavior only frustrates a deal. Let us not hide behind a computer, let us communicate freely and openly so that we can all accomplish our mutual goal. I call him several times, to no avail. I call his broker, also no answer. I talk to my broker, who then calls his broker (My daddy is going to beat up your daddy). The other broker answers this time and I convey my frustration and politely explain that the sellers have until this evening or our deal is off the table. No response from broker, other than "ok, did you call the agent." -Oh! That's what I forgot to do! YES, I have tried several times. -His response, "ok, do you want me to try him?" Needless to say, I received a phone call later on to which the agent explained that he did not present the offer to his principal (or even went to meet him in fact), but was negotiating through the principal's wife the day before!!!! When asked why he did not meet with the principal when he was supposed to and have them sign and initial changes, he said he doesn't do that because he has had knee surgery so he is not mobile.
AGENTS: YOU HAVE TO PRESENT OFFERS TO YOUR PRINCIPALS, NOT THEIR WIVES OR AUNTS OR COUSINS! AND WHEN YOU PRESENT, IT MAY BE A GOOD IDEA TO DO IT IN PERSON AND MAYBE EXPLAIN TO THEM WHAT THEY ARE SIGNING!!
I was told he will try and have my deal executing Friday night, needless to say, I never heard back.
Saturday, I have appointments scheduled from the day before (I am a good boy scout I always try to schedule the day before). I have one property scheduled from 2-3pm. We show the home at about 2:15ish? My buyer loves the home and wants to write up an offer. I get in my car and the phone rings, it is from the centralized appointment center -not from the agent- they are cancelling my showing from 2-3pm, because they have signed off on another agreement! It's 245 at this point!!
AGENTS: YOU KNOW WHEN A DEAL IS COMING IN, YOU ALSO KNOW WHEN YOU HAVE APPTS SCHEDULED. ARE YOU REALLY DOING YOUR SELLERS A SERVICE BY NOT WAITING TO EXECUTE UNTIL YOU HEAR FROM THE PEOPLE SHOWING THAT DAY? OR HOW ABOUT YOU CALL THE SHOWING AGENT YOURSELF AND LET THEM KNOW A DEAL IS COMING IN THAT DAY? OR HOW ABOUT CALLING TO CANCEL BEFORE WE WASTE OUR TIME? OUR APPT WAS 2-3, WHY AM I GETTING CALLED AT 245??
In the interim, I was scheduling showings for Sunday (same buyers from the Friday agreement fiasco), and received confirmation for both homes. Well, sort of. The second confirmed, but did not provide information on how to access the home other then instructions that I had to call the listing agent before showing. So I called about 30 minutes before showing it, no answer from the listing agent. I leave a detailed message about why I am calling and that I do not have any idea about how to access the home. No return call! I show the first home and call the agent again, NO ANSWER! We arrive at the home and now my buyer takes it upon herself to call the listing agents office herself. She is extremely frustrated with all the events she has been through in the last 48 hours. The receptionist also cannot get in touch with the listing agent! I call centralized showing desk again and they do not have any lockbox info and also cannot get in touch with the agent. Finally, 40 min after we were scheduled to show, the agent call me back and gives me the lockbox combo! He wants to know why I am frustrated also? I believe his exact words were "Why are you barking at me?" How about the fact that you cannot do your job, which effects me doing my job properly?!
AGENTS: DO NOT MAKE YOUR JOB HARDER, IF YOU HAVE A VACANT HOME THAT YOU INTEND ON JUST GIVING OUT A LOCKBOX COMBO TOO, PROVIDE IT TO WHEREVER AGENTS ARE SUPPOSSED TO CALL TO SCHEDULE!
So let me sum up my goals for all of us agents (please feel free to add on or comment):
1 We are NOT adversaries, leave that to the lawyers, we have a mutual goal, to get our respective clients to settlement as painlessly as possible.
2 Return phone calls. There are only so many times we can make excuses for each other as to why we are not getting return calls (Are we not in a down market? Why aren't agents chomping at the possibility of a deal coming in?)
3 Whatever your religious persuasion is, the rule is the same and incorporated into every religion and culture. Treat others the same way you want to be treated. Respect each other.
4 Know what you are having your clients sign and make sure they understand it.
5 When presenting an offer, present to the person(s) who have the authority to act. Your Principal(s).
6 Do not make your jobs more difficult then they need to be, provide all relevant showing information to your respective appointment centers. Agents do not want (or need) to jump through hoops to show your listing. And are you acting in your sellers best interest by making it more difficult to show?
7 Sometimes it is our clients that make us act the way we are acting. But we need to educate our clients about the process, so that they understand that when they make it difficult to show their home or whatever, they are only adding to their own difficulties of accomplishing the goal of buying or selling their home.
8 When you ask for feedback, please do not sell me on your property or argue with me about why my buyer's opinion (or mine) is incorrect. That only leads to not wanting to provide feedback.
9 Provide feedback.
10 It is ok that you are only a "part-time" agent. I know that there is a stigma about it, but let's get over it. Just let us know ahead of time, so that we are prepared for the possibility that we can only communicate certain ways/times and we can only settle certain days/times.
Tuesday, February 3, 2009
Pending Home Sales For December
National Association of Realtor's has just released pending home sales for the month of December 2008 and the outlook for real estate is looking up!
The Pending Home Sales Index, a forward-looking indicator based on contracts signed in December, rose 6.3 percent to 87.7 from an upwardly revised reading of 82.5 in November, and is 2.1 percent higher than December 2007 when it was 85.9.
The largest increases were in areas where there were bigger improvements in home affordability. NAR’s Housing Affordability index rose 10.9 percent in December to 158.8, the highest on record. The HAI shows that the relationship between home prices, mortgage interest rates and family income is the most favorable since tracking began in 1970.
This is great news for Seller's, they will start to see an uptick in home showings. Of course, conversely, bad news for Buyer's as they will begin to compete for their dream homes.
The Pending Home Sales Index, a forward-looking indicator based on contracts signed in December, rose 6.3 percent to 87.7 from an upwardly revised reading of 82.5 in November, and is 2.1 percent higher than December 2007 when it was 85.9.
The largest increases were in areas where there were bigger improvements in home affordability. NAR’s Housing Affordability index rose 10.9 percent in December to 158.8, the highest on record. The HAI shows that the relationship between home prices, mortgage interest rates and family income is the most favorable since tracking began in 1970.
This is great news for Seller's, they will start to see an uptick in home showings. Of course, conversely, bad news for Buyer's as they will begin to compete for their dream homes.
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