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Posts Tagged ‘Real Estate’

I just finished the 4th of July week working with a couple moving here from Illinois for a new job.  We spent all week looking at homes for them and their family.  Of course we looked at many resale homes in different neighborhoods, but also looked at several new construction homes.  They finally chose a new construction home for several reasons regarding the floorplan, yard and overall neighborhood.  One of the factors that won them over was price.  They bought in a neighborhood in Mooresville that is like several in the area in that it was started by one builder who ran into problems during the economic downturn, and the neighborhood was bought by another builder or developer.  The new builders who buy under these circumstances often get the lots and infrastructure at a very good price.  That enables them to price their new homes very competitively.  They have to be priced well in order to compete with resale homes, many of which are foreclosures or short sales which often sell at relatively low prices.  In some cases, the new builders have re-set the price range of the neighborhood to lower levels to attact buyers who now tend to look at overall lower price points.  That doesn’t do the original neighborhood owners any good since it makes it harder for them to sell is they choose, but that’s what has to be done by the builders to compete.New House Under Construction

This is a particularly good time to buy new construction because of these circumstances of builders buying less expensive property.  I suspect that this peculiar situation will eventually come to an end.  Most of the well-located neighborhoods that were available to builders have been purchased and are selling out.  When the builders want to expand, they well may have to pay more for the land and will have to pay for installation of infrastructure (surveys, roads, sewers, street lights, etc..  At some point, particularly as the inventory of all for sale housing drops further, they will no longer be able to offer such great prices on new houses.

If you’re thinking you’d like to move and buy a brand new house, now’s likely the best opportunity you’ll see for a long time.  Often the builders can offer special incentives on options, equipment and mortgage rates to add to the value of the deal.  Many builders are also carrying inventory homes that are ready to go or close to it so that you can choose final colors and finish materials.  Even the custom builders are eager to build something for you at a good price.

Let me know if you want help with that!  Builders market to real estate agents all the time because they know we are working with the bulk of buyers.  They don’t discount their prices by selling directly to buyers, and buyers are well-served by having an agent working for them to help them get the best negotiated deal.  We do this all the time, so are not intimidated by the process.

Call me if you want to investigate what’s out there.

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Much of the growth in the Lake Norman, Cornelius, Huntersville, Mooresville, Troutman and Statesville markets is coming in the form of new residential developments and new homes.  Given the stresses on the real estate market today, there are many new homes for sale at very good prices.  If you are considering a new home, you must understand that when you are talking to a sales person at a model home, you are talking to someone who’s responsibility and loyalty is to the seller, just like an agent who has listed a house.  The agent has only those homes to sell, so they will try their best to sell you one of the builder’s homes and show you no other choices.  They will try to get you to pay the highest price for the least amount of house and options because that is how the builder will make the most profit from the transaction.  Nothing wrong with that.  The agent is required by NC real estate law to do this.

However, this is not the best arrangement for the buyer, of course.  How do you as a buyer deal with this?  Well, the best way is to select an independent agent to represent you as your “Buyer’s Agent.”  NC real estate law also allows an agent to work for the exclusive benefit of a buyer.  The Buyer’s Agent will listen to your wants and needs, survey all the possible choices in the market place, accompany you to visit the new homes, assist you in talking to the new home sales agents, and if you want to make an offer on a new home, help you negotiate the best deal.  The Buyer’s Agent will also help you arrange for the best mortgage for your situation.  After the contract is signed, the Buyer’s Agent will follow the construction of the home if it is to be built, offer to arrange for an inspector to work for you in being sure the construction from the foundation up is done correctly, and insure that any changes from the original plan are completed properly and charged accurately.  Prior to closing, your Buyer’s Agent will do a final walk-through to be sure there are no loose ends.  At closing, the Buyer’s Agent will accompany you to the closing to insure that you got exactly who you planned to get based on the contract you signed.

You might think that builders will charge you more because they are paying their sales agent plus your buyer’s agent.  That is certainly not true for most builders.  In fact, they are constantly marketing to the general Realtor community, encouraging us to bring buyers to them.  They even offer a variety of incentive to the Buyer’s Agents to bring buyers.  They can’t afford to undercut their prices on transactions that they handle without Buyer’s Agents, because that would discourage Buyer’s Agents from bringing their clients.

So, before you start talking with new home sales people, get a Buyer’s Agent working for you.  You’ll then find that even when you are just looking around at various subdivisions, you can just give the sales agent the name of your Buyer’s Agent, and they will register that working relationship in their files so that there is no question who is working for whom.

If you’re thinking of buying a home and new construction is an option, call me to discuss further how I can help you.  704-877-2375 / SSuther@C21Hecht.com

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Tom Kunz, CENTURY 21 CEO was recently interviewed (Oct. 24) on Fox Business News about the uptick in housing sales in September and how consumers we be advised to react to the current real estate market and financial conditions.  See the interview here.  I think he provides some good advice.

Here is a link to a National Association of Realtors article on the new housing report.

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Time for another update on real estate activity in the Lake Norman area.  Just did a quick look at the last two weeks’ activity.

Iredell (area 12) single family homes and condos that went under contract- 48

Iredell (area 12) single family homes and condos that sold- 34

N. Mecklenburg (areas 1&9) single family homes and condos that went under contract- 109

N. Mecklenburg (areas 1&9) single family homes and condos that sold- 108

Lake Norman (area 13) single family homes and condos that went under contract- 30

Lake Norman (area 13) single family homes and condos that sold- 41

Remember- that is for the last two weeks.  Still think the market is dead?  Yes, it is slower than the same time last year, but if it is your house that went under contract or sold in the last two weeks, then the market is still working for you.

If you have questions about any other segments of our local market, let me know.

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The front page of Saturday’s The Charlotte Observer has a good article on how our local Lake Norman/Charlotte market is still doing a good volume of real estate business.  As I’ve been telling my clients, The Observer notes that if you sell within our market and buy within the same market, you can afford to reduce your asking price in order to get the sale because the sellers of the house you ultimately buy will be dealing with the same pricing pressure.  The point of selling a house and buying another is not to sell for the highest price, but rather to keep the price difference of the sold and purchased houses the least.  If you are thinking of moving up in home size, the pricing pressure on the large house is generally greater  than on the smaller house, meaning that buying now will probably get you a better deal than waiting for the market to level out and become more normal.  By the way, although we’ve seen some recent up and downs in mortgage rates, they still are quite attractive.  Check the trend at Mortgage101.

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As I said in an earlier post, mortgage lenders tell me that there is plenty of money to lend for mortgages.  The only hitch is that you need to have a job, and you need to have a relatively good (not perfect) credit score.  So, you might wonder what are the factors that control that number.  Well,  here is a short list of things to consider.

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.

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I’ve been watching the recent financial turmoil to get a hint of how the economy (and of course, real estate) will look over the next 6 months to two years.  Yesterday’s historic 936 point jump and today’s modest 77 point profit- taking drop are encouraging.  From a real estate standpoint, we’re seeing much softness in the market.  I think that is primarily due to uncertainty of homeowners and buyers about what their personal financial condition will be in the near future and beyond.  If you’re not sure you’ll have a job, you’re not likely to decide to sell or buy real estate.  As with the banks and their short term lending freeze, everyone is missing the confidence that our economy requires to move ahead.  If we can regain confidence in our financial system, then we’ll have confidence that businesses and jobs won’t suffer and that people will be able to once again plan their lives beyond a week to week view.  I’d guess there’s still plenty of excitement ahead, but if we can at least slowly rebuild our confidence level, then we may see some blue sky ahead.  If history is any guide, once we get past the election, regardless of the outcome, there will be some market strength gained by taking away one of the uncertainties that we’ve been facing.

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