What Every REALTOR® Wants You to Know About – Months of Inventory


Ask anyone who has bought or sold real estate and there are certain terms that are common knowledge; mortgage, interest rates, days on the market and on and on.

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But there is one term that most people are not very familiar with and it is a critical number to real estate. REALTORS® watch this data very closely as it determines a buyers’ or sellers’ market and that makes a difference to anyone looking to buy or sell.

Generally speaking, the Months of Inventory is determined by how long it would take to sell all of the homes on the market at the current number of sales for that month. For example; if there are 1,000 homes on the market, and 300 homes close that month, then your Months of Inventory would be 3.3 months. To explain it another way, if no other homes came on the market and the current rate of sales remained the same, it would take 3.3 months to sell all of the homes on the market.

This number changes monthly, but it is a good determination as to the market conditions and what buyers and sellers can expect.

As a general rule, if the Months of Inventory is 6 months or more it is considered a buyers market. Between 3 months and 6 months it is considered a neutral market, the market doesn’t favor buyers or sellers. Less than 3 months and it is considered a sellers market. Needless to say, these numbers make a world of difference to both buyers and sellers.

Given that real estate is an extremely local issue, it is important the your real estate agent understand the numbers for Months of Inventory. Maryland dropped from 5.0 Months of Inventory for February, 2016 to 4.4 Months of Inventory in March, 2016. Both of these numbers are still considered “neutral”, however, the trend is clearly heading towards a sellers market.

Frederick County, Maryland dropped from 4.4 of Inventory in February to 3.8 Months of Inventory in March of this year. Frederick County Maryland is on the cusp of becoming a sellers market. A sellers market will generally result in fewer homes to purchase and higher prices.

If you are thinking of buying or selling, talk to a real estate professional – talk to a REALTOR® – who can give you the information you need to make an informed decision.

As always, if I can help with any of your real estate needs, please feel free to text or call me at 301-712-8808 or email me at RolandLow1@gmail.com

Roland

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What Every REALTOR® Wants You To Know: Buyer Beware!


What Every REALTOR® Wants You To Know: Buyer Beware!

During the last several months I and every other REALTOR® has been advising potential buyers that are thinking of buying real estate to do it NOW! Many did, some did not. Here are the reasons for sounding the alarm for buyers and what to do about it.

Home Buying 101

No one doubts that there is a huge pent-up demand for home buying. Buyers are slowly moving back into the market, but they are facing a rapidly changing market place of which they need to be aware.

In the Frederick, Maryland area, home sales have been a buyers’ market for quite some time. A couple of months ago the inventory levels have dropped to the point that the market is now considered neutral – neither a buyers’ market nor a sellers’ market. And last month that number dropped even lower. Its still a neutral market, but closer to a sellers’ market, and that is bad news for buyers’. Good news for sellers’, though.

The good news for buyers’ is that mortgage interest rates remain low and that will help boost a home buyers’ purchasing power or enable more buyers to qualify for a mortgage. Mortgage applications for this year are up 20% compared to last year.

The REALTOR® website has reported a record number of searches for homes on its’ website. Nevertheless, there are about 2% fewer homes on the market compared to last year, making the search for buyers more critical. Not only are their fewer homes on the market, those homes that sell are selling faster than last year. The first two weeks of April of this year showed that homes sold 14 days faster than in March of this year.

Here is what I suggest that anyone even thinking of buying within the next year do.

Contact a REALTOR® and discuss with them your plans. They will be able to tell you the market conditions in your particular area. Real estate is a very local matter.
Once you decide to buy, not look, but buy, it should be like a job search. If you’re only looking now and then when its convenient, then you are probably wasting your time. Buying a house takes time and commitment.
If you find a house you want, don’t risk losing that house by over-thinking it. Sleeping on it a day or so may be wise, but the rule of thumb is ‘The house you looked at today and wanted to think about until tomorrow, may be the house someone looked at yesterday and wanted to think about until today.’ Be prepared to move – aggressively.
Your REALTOR® will most likely ask whether or not you have been pre-approved for a mortgage and for what amount. If not, get pre-approved immediately. You want to be able to present a pre-approval with any offer you make. It shows the sellers you are serious.
I advise buyers to make realistic offers on a home. Your REALTOR® will most likely be able to advise you if the asking price is a reasonable price for that market. If it is, my advice is to not low-ball the offer. More than likely you’re going to wind up close to the asking price anyway and you risk losing the house during the process. I have had clients who insisted on low-balling so bad that the sellers would not consider any offer they made. May not be right, but it happens.
Think seriously about what contingencies you absolutely need to have incorporated into the offer. I am a firm believer that a house inspection is an absolute must, but don’t nit-pick the findings as if you expect everything fixed.
If you want to give the impression to a seller that you really want to buy their house, do not drag out any response to a counter offer. Be prepared to respond quickly and concisely. By dragging out a response it tells the sellers that you may not be as excited about the house as they hoped. During that time sellers can retract any counter offer and accept a new offer.
The last thing I will mention is that buyers’ need to be clear on what they need and what they want. All to often I have clients tell me that granite counter tops “are a must”, yet those counter tops can be added at anytime for relatively little cost compared to a home.

If you are thinking of buying or selling, talk to a real estate professional – talk to a REALTOR® – who can give you the information you need to make an informed decision.

As always, if I can help with any of your real estate needs, please feel free to text or call me at 301-712-8808 or email me at RolandLow1@gmail.com.

Roland

What Every REALTOR® Wants You To Know About Escalator Clauses


What Every REALTOR® Wants You To Know About
Escalator Clauses

As the real estate market heats up across the nation, buyers’ and their agents are looking for more and more ways to get the competitive edge. In many markets, we are now seeing multiple offers for new listings.

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The most recent data from Maryland Association of REALTORS® indicates that Frederick, Maryland has changed from a buyers’ market to a neutral market, meaning that there is less than six months inventory available. If that trend continues, the area could become a sellers’ market at which time buyers’ and three REALTORS® may want to consider an escalator clause with their offers.

There are several options that a REALTOR® can use to persuade a potential seller to select their buyer in the transaction. One of the best ways is for the buyer to be pre-approved for a mortgage. A strongly written letter of approval from the mortgage company is a plus. It is also important for buyers to make offers that are reasonable for the market. Buyers want to offer the least amount that they can and sellers want the most amount they can get; but in a competitive market where there may be multiple offers, buyers’ may lose out of the home they want.

There is another option that is occasionally used in hot markets and that is the escalator clause of a real estate contract. As with everything, there are pros and cons of an escalator clause and something that your REALTOR® can walk you through.

Basically an escalator clause provides that if buyer A makes an offer for X amount of dollars, in this example, lets say $300,000, the escalator clause details how much more buyer A will offer if a competitive bid comes in. If the buyers REALTOR® adds an escalator clause they would also include how much that offer of $300,000 will increase if there is a competitive bid, for this example, lets say $3,000. If a competitive bid from buyer B comes in at $301,000, buyer A’s offer automatically rises to $303,000. It is also critical that the REALTOR® of buyer A stipulate in the escalator clause how much the increase will be and the maximum amount.

The pros of an escalator clause is that it can help ensure that your buyers’ obtain the property that they want.

But there are some cons that need to be discussed with your REALTOR®. First of all, an escalator clause should only be used in a hot market where you are reasonably sure that there will be multiple offers. It is still important that any offer made is a reasonable price based on the market conditions at that time. I have seen buyers make sellers mad for a low-ball offer and nothing will get those negotiations back on track.

Second, the buyers’ REALTOR® must be able to confirm and validate any competitive bids that are received.

Third, by including an escalator clause with an offer, the buyer will play their hand at how much the buyer is willing to pay. For example: If the buyer submits an offer of $300,000 with an escalator clause indicating that they will increase their offer by $3,000 for any competitive bid up to $310,000, that buyer has now indicated that they would be willing to pay $310,000 for the house. If there are no competitive bids, the seller will most likely counter with $310,000 and may hold firm.

The last con I will mention is that many sellers do not like escalator clauses and will reject them. They would rather have a potential buyer offer their highest and best offer from the beginning.

If you are thinking of buying or selling talk to a real estate professional – talk to a REALTOR® – who can give you the information you need to make an informed decision.

As always, if I can help with any of your real estate needs, please feel free to text or call me at 301-712-8808 or email me at RolandLow1@gmail.com.

Roland

What Every REALTOR® Wants You To Know About Professionalism


What Every  REALTOR® Wants You To Know

About Professionalism

There are as many different styles of real estate agents as there are real estate agents. Every one of them has their unique style and belief in what is important to bring a real estate transaction to successful conclusion.

REALTOR® Means Professional

But there are some basic issues that I believe are at the core of what separates the “men from the boys” or “women from the girls”. To put another way what separates professional from non-professional.

I am dismayed when I talk to people, and even agents, who believe that the only thing that needs to be done to sell a house is to list it on the MLS. And even then I see listings on the MLS with misspelled words, inaccurate descriptions of the property and photos that are all but worthless. This is not what I would consider “professional”.

Here are some areas that I think separates professional from non-professional agents.

1. Even though you can take great pictures with a smart phone or iPad, they are no comparison for a professional photographer who takes high resolution photos, with lens that are not available to non-professional photographers.

2. A professional video of your property that is included in your marketing.

3. A dedicated website for your address that includes the photos, video, additional information and contact information for anyone interested in your listing.

4. As a REALTOR® with Coldwell Banker my listings are promoted on the Coldwell Banker website and syndicated throughout the Multiple Listing Service.

5. Today’s homebuyers’ use social media to search for their new home. As a result, professional real estate agents will embrace wide use of social media to get the message out that your home is for sale.

There are two more areas that are often overlooked, but I think are critical to professionalism in real estate:

6. Your home must be priced accurately. I’m not talking about the little wiggle-room that will undoubtedly be included, I am talking about listing a home for the price that the sellers’ want for their home as opposed to what the agent knows the market will handle.

7. One of the most over-looked skills of a professional real estate agent is their negotiating skills. Very seldom is a home sold with the buyer giving the asking price without any kind of negotiating involved. All too often, people let the emotions get in the way of the negotiating and a deal crumbles.

If you are thinking of buying or selling, talk to a real estate professional – talk to a REALTOR® – who can give you the information you need to make an informed decision.

As always, if I can help with any of your real estate needs, please feel free to text or call me at 301-712-8808 or email me at RolandLow1@gmail.com.

Roland

What Every REALTOR® Wants You To Know About Buying and Selling


Anyone who has ever bought or sold a home knows that there is a lot of work involved. Getting it on the market is only the beginning of the work for sellers and often times the sequence of events of listing your home is out of whack.

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My advice to anyone even thinking of selling their home is to find a REALTOR® whom you are comfortable with. The general belief is to find a REALTOR® who has sold a lot of homes, or who has been in the business for many years or whatever the prevailing wind is that day. My suggestion is to talk to REALTORS® until you find one you are comfortable with and sign a contract. The biggest issue that faces most clients and REALTORS® is communication. So, discuss up front how you would like to communicate with each other.

There are REALTORS® who have been in the business for years and are not what you would expect, and there are REALTORS® who have just started their careers and will do a top notch job.

All too often home buyers’ begin the process by looking for a home they want to buy. Once they find that home, they are under the gun to get their home ready to sell in order to buy their new home before losing it to someone else.

Here are some suggestions to help you if you are even thinking of selling your home and buying another one.

1. Select a REALTOR® whom you are comfortable with to handle both your listing and buying. Many times home owners will find a house they want to buy and then have that agent – who represents the sellers – sell their home. Never a good idea!!

My suggestion is to select a REALTOR® that you can communicate with and has a high degree of professionalism. Listings that have misspelled words or photographs that do not show the property in the best light, have no place in real estate these days.

2. Have your agent determine a realistic selling price of your home. Determining a listing or selling price is part science and part art. How much you want or need to get for your house has no bearing on what the market says. The rule of thumb: Sellers’ determine the listing price, buyers’ determine the selling price.

3. Declutter and clean! This is one area that cannot be stressed enough. Homes must be decluttered and clean. The whole idea of declutter is to enable a potential buyer to walk into the house and feel it is theirs, not yours. Personal family pictures that are near and dear to all of us, make selling a home more difficult.

If you are even thinking of buying or selling, talk to a real estate professional – talk to a REALTOR® – who can give you the information you need to make an informed decision.

As always, if I can help with any of your real estate needs, please feel free to text or call me at 301-712-8808 or email me at RolandLow1@gmail.com.

Roland

What Every REALTOR® Wants You To Know – Home Inspections


Beyond a shadow of doubt one of the most important steps a home buyer can make is to opt to have a home inspection.  If you are thinking of buying a home, having an inspection should be an absolute given.

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A home inspection can range in the vicinity of $500- $600, depending on your location and what all you decide to have inspected.  This is probably the best money you can invest in your home search.  Selecting the right inspector is critical.  Your REALTOR® will be able to help you find a suitable inspector.

There are two pitfalls that all too often home buyers fall into.  One is deciding that the Property Disclosure document that the sellers filled out will tell them if there are any issues that buyers need to be aware of.  Unfortunately, often times there are issues that the sellers are not even aware of and as such were not listed on the disclosure.  I won’t even go into the issue of whether or not the sellers were honest or not.

The second pitfall home buyers can fall into is having a friend or relative that they think may know a lot about home construction to “take a look” at the house to see if it is in good shape.  Even if this person is very knowledgeable about home construction, in many states the contracts will require that the inspectors be “licensed and qualified” in order for you to negate the contract based on issues found with the house.  Having a good friend of the family who is not licensed or qualified may not allow you to get out of the contract if issues are found.  Always, always, always use a licensed and qualified home inspector for your home inspections.

If you are thinking of buying or selling, talk to a real estate professional – talk to a REALTOR® – who can give you the information you need to make an informed decision.

As always, if I can help with any of your real estate needs, please feel free to text or call me at 30`1-712-8808 or email me at RolandLow1@gmail.com.

Roland