It’s no common secret that the real estate market over the past year has continued to dramatically change towards a market concentrated in short sales, foreclosures and REO’s.  

For those of you that don’t know what REO means — it means Real Estate Owned.  It’s a term used to identify a property is owned by a bank.  Banks actually consider REO’s a liability instead of an asset because they are in the MONEY business not real estate business. 

As a Top Selling Team in Tampa and St Pete, we have modified our business to help service these “niche” markets.  In the first quarter of 2009, nearly half of our business was selling (either listings or homebuyers) distressed properties.  We have learned through much education, courses, certifications, and trial and error the best ways to represent buyers and sellers in these specific situations.

If you are a Realtor and haven’t started working these markets — WAKE UP!  If you are in a market that has not been hit as hard with foreclosures, don’t worry its coming.  It’s time to prepare now.  

If you are a new real estate agent, read up!  I had a new agent join our team this week and just like I’d send this information to a prospective home buyer, I wanted to review it and tailor it to him so he understands the urgency needed to work buyers on bank owned houses.

Below are tips for Realtors representing buyers on bank owned homes. Continue reading this post

If a client asks you to list their house but tells you it was the scene of a gruesome murder or a suicide, or the house is haunted, are you required to disclose this information to prospective buyers? The short answer is maybe.

Material Facts

Most states have disclosure laws pertaining to property condition and latent defects. The legal standard requires a seller to disclose “material facts” known to the seller that may influence a buyer’s decision. Common examples are a history of termite infestation or major damage from natural events (floods). But when it comes to property that may have been the scene of a murder, suicide or even an AIDS related death, states are divided on the issue of disclosure. Courts have given no clear guidance either.

These psychologically impacted properties, defined as “stigmatized” by the National Association of Realtors, are harder to sell, if the particular fact or suspicion is disclosed, according to James E. Larsen, Ph.D. and Joseph W. Coleman, business professors at Wright State University.

Stigmatized Effect on House Sales

Larsen and Coleman did a study of more than 100 psychologically impacted houses. They found that they take 45 percent longer than comparable homes to sell, and price at an average of about 3 percent less. It is not surprising that many buyers will not buy a house where a gruesome crime or suicide has been committed.

At least 21 states have enacted laws, known as stigma disclosure statutes, concerning the (non)disclosure of psychological facts. In those states that have not enacted these statutes, there are no hard and fast rules about disclosing property stigmas. Continue reading this post

Many property owners that would like to sell now find they have to hold and manage. If you own far from where you live or you simply aren’t interested in managing a second business, you should consider a professional property management. 

Does One Size Fit All?

No. Property Management companies come in all sizes, some manage 20,000 units and others 500. Many property management companies are a small or family business’s. A large management company should have more resources available, but service may not be personal and it’s easy to get lost there unless you have a large portfolio. That’s the first point to consider; which size management company will give you personal service.

Interview smaller companies that would bend over backwards for your business. You may get better service and price leverage.  If you choose this route, try to assess whether the company can absorb new business quickly, it’s a litigious business and they must be responsive day one.

If you have a single family home or a smaller rental property it’s just not that attractive to many companies. Not much income and although a larger company may welcome you, they may not give you much service. You may find that suddenly, you have many more little maintenance items than ever before as they maximize income within house maintenance and repairs. 

How Do You Find Them?

Word of mouth is best. If you don’t have a personal resource then: Continue reading this post

Surrounded by plummeting prices, bankrupting banks, fickle financiers, sagging stocks, cantankerous consumers … It’s time for some frivolity.

If you, like I, show a decent number of properties and, in the process, read the displayed MLS remarks, you’ll quickly discover that the art of good fiction writing is alive and well. With the current onslaught of foreclosures and distressed properties, listing agents have become, by necessity, “creative” with their carefully crafted comments. As I read their information, designed to convey the important aspects of the home, I’d swear some of them are gunning for a Pulitzer.

And then you visit the property, read the comments again and ask, “How did we get there from here?”

As an example, a property I recently visited had remarks stating, “Needs cosmetic work.”

Translation? “Throw in a stick of dynamite and start over!” The carpets were decimated, strips of wallpaper hung peeling from the walls, all the baseboards were missing and there was SUBSTANTIAL water damage to an upstairs bathroom floor and the ceiling underneath. Read, “gaping hole.” And that was just the beginning.

A REALTOR’S job is to sell property, and what they pen is designed to get you and your homebuyer to visit.

Continue reading this post

1. Big Discount - Home buyers want a big discount from list price. If the market value of a home is $400,000 and you price it at $375,000 to sell it quickly, buyers still want a large discount from list price.

2. Sellers Pain - If the home seller does not appear to be in pain many buyers won’t feel like they are getting a good enough deal. Even, if they are getting a heck of a price for the home.

3. Foreclosures - Buyers tend to think that all foreclosures are a sweet deal. That is not always the case. 

4. Short Sales - Many banks still stink at getting a short sale approved quickly. A friend of mine recently had a short sale close and said the bank had 17 different people touch the file. No wonder the banks are in trouble.

5. Bad News - Sellers are quick to ignore the bad real estate news but very quick to latch on to the good news.

6. Good News - Buyers are quick to ignore the good real estate news but very quick to latch on to the bad news.

7. Time to spare - Many home buyers feel like they have all of the time in the world.

Continue reading this post

Michael Gwynn is a student of real estate. Although he holds a California Real Estate License and multiple investment properties, Michael is currently immersed in the world of online marketing solutions that connect real estate agents and brokers with home buyers and sellers as the Sales Director at www.HomeGain.com.

In today’s world there are many financial casualties associated with the failing real estate market. There are many homeowners who purchased properties and had little knowledge, experience, or insights into the real estate market. But, there were also a number of real estate investors that could have and should have known better. These good investors had experienced bad outcomes with their property purchases because of the lures, pitfalls, and hazards associated with the world of real estate. These lessons are important to learn because there are many new and experienced investors jumping back into real estate in 2009.

Those who do not learn history are destined to repeat it.

There were several factors and causes for these bad outcomes for these good investors. Some were lured by the gains reported in many publications. Others succumbed to the attractive sirens of the real estate Guru’s.

There were those who did not understand the order of purchasing investment property because they purchase equity growth properties before income properties.  Many purchased at the peak of the price points. Other wanted only to stay in their local markets. Miscalculations were made on the costs for holding properties.

The potential issues of holding property were never realistically expected or prepared for by the property purchasers. Methods to truly analyze a real estate market and economy were not effective.  Technology and available information was not used to its best potential. Real estate professionals were seen as the enemy and not used appropriately in the transactions. Many did not understand the cycles involved in real estate.

Continue reading this post