8 quick fixes

8 Quick Fixes to Increase Value

per the National Association of Realtors

With buyers more and more scarce, sellers must up the ante to convince them that their property offers what many want most — top value for dollar expended. Here are eight fast fixes:

1. Buff up curb appeal. You’ve heard it before, but it’s critical to get buyers to want to look on the inside. Be objective. View listings from the street. Check the condition of the landscaping, paint, roof, shutters, front door, knocker, windows, house number, and even how window treatments look from the outside. Add something special—such as big flower pots or an antique bench — to help viewers remember house A from B. No one has a chance to buy a house if they won't even walk through the door.

2. Enrich with color. Paint’s cheap, but forget the adage that it must be white or neutral. Just don’t let sellers get too avant-garde with jarring pinks, oranges, and purples. Recommend soft colors that say “welcome,” lead the eye from room to room, and flatter skin tones. Think soft yellows and pale greens. Tint ceilings a lighter shade. Though I truly believe that going neutral is a pretty good idea, I don't mind the alternatives.

3. Upgrade the kitchen and bathroom. These make-or-break rooms can spur a sale. But besides making each squeaky clean and clutter-free, update the pulls, sinks, and faucets. In a kitchen, add one cool appliance, such as an espresso maker. In the bathroom, hang a flat-screen TV to mimic a hotel. Room service, anyone? I agree with upgrading the kitchen and bath but would probably stop short of the flat-screen.....but that's probably because I don't even have one in my family room or bedroom let alone bathroom!

4. Add old-world patina (a film on the surface of bronze or similar metals, produced by oxidation over a long period, sheen on wooden furniture produced by age, wear and polishing, or any such acquired change of a surface through age and exposure) Install crown molding at least six to nine inches in depth, proportional to the room’s size, and architecturally compatible. For ceilings nine feet high or higher, add dentil detailing, small tooth-shaped blocks used as a repeating ornament. It’s all in the details, after all. Old world charm works for some- not so much for others, proceed with caution.

5. Screen hardwood floors. Buyers favor wood over carpet, but refinishing is costly and time-consuming. Screening cuts dust, time, and expense. What it entails: a light sanding, not a full stripping of color or polyurethane, then a coat of finish. A cleaner, shinier floor is much more appealing than your dusty, dingy floor. Just because you have a wood floor doesn't mean it's an upgrade...if it's not cared for, it's as much a detriment as a grungy carpet- maybe even more so with the cost of fixing.

6. Clean out and organize closets. Get sorting—organize your piles into “don’t need,” “haven’t worn,” and “keep.” Closets must be only half-full so buyers can visualize fitting their stuff in. Definitely! Clean, clutter free houses sell better than those with junk- expand this thought from the closet out.

7. Update window treatments. Buyers want light and views, not dated, fancy-schmancy drapes that darken. To diffuse light and add privacy, consider energy-efficient shades and blinds. People notice dirty, cheap blinds too. Upgrade to a nice wood or faux wood blind (properly fitted) and you'll be happy you did.

8. Hire a home inspector. Do a preemptive strike, since busy home owners seek maintenance-free living. Fix problems before you list the home and then display receipts and wait for buyers to offer kudos to sellers for being so responsible. I promise this will work and save you many possible headaches later on!

First Time Home Buyer Steps Part 8

Your home inspection is completed and it either came away crystal clean, really really bad or most likely somewhere in between. If you have come to resolution with the issues you're continuing on with the transaction- if not, you're going back to the 'search for homes step.' Once you have this out of the way the rest is pretty much smooth sailing!

You'll possibly need to come up with documentation or sign papers to complete your loan paperwork and you will definitely want to shop around for homeowners insurance- something you will need to have done and ready before closing. Keep in mind that the insurance company is going to want you to pay a year in advance- just another one of those things you rarely consider when budgeting for a home.

You're through the process now. Home found, offered on, negotiated, inspected, (possibly re-negotiated), insurance purchased....now it's time for the big day, closing! You'll want to do a final walk-through of the property to make certain it is in the condition it was promised to be in. I recommend doing this immediately before closing, but the evening before is also a justifiable option in most cases.

As a buyer with a mortgage, you'll want to ice up your hand the night before (or is that heat? I never know). Bottom line is- you'll have a bunch of paperwork to sign with your attorney. He or she will explain what you are signing and why- and sometimes your lender will be there to answer questions as well, and of course, your favorite REALTOR will be hanging around should any complications arise. I've been in closings that were done in a half hour. I've also been in some that lasted 3,4,5 hours or had to be pushed back to the following day- almost always while waiting for funding. If funding is present, the closings go smoothly and everyone can go out and celebrate! And by celebrate, I mean moving furniture and boxes and cleaning!

First Time Home Buyer Steps Part 7

Inspection and modification:

You're cruising along quite nicely. You've found a REALTOR, lender, house and have it all negotiated and agreed to....you're holding on to a signed contract to buy your first home. Congratulations! Now you've got to make certain that puppy is a good buy (home inspection) and that you're well represented (attorney).

Nothing scares me more, in working with buyers, than the potential call 6 months or a year later to complain that the house I sold them is a lemon. I always recommend the single-best inspector around. Your REALTOR can and will give references out as well. Here's some things to inquire about when selecting a home inspector (whether referred or not):

• How long have you been practicing?
• Are you member of a professional association?
• What is your continuing education requirement?
• Can I attend the inspection?
• How long will it take?
• What will you/won't you inspect?
• What is the fee?
• What type of report do you give and how long will it take to be completed?

Any inspector worth his or her salt should answer all of these questions quickly and confidently. If you have any hesitation towards the individual or team you're considering, step back and question yourself, "Can I wage possibly the largest investment of my life on this person's 'expertise'"? If the answer is no, move on.

Assuming you select a good inspector and the home being purchased is not an 'as-is', short sale or any type of REO or bank owned property- you will have until the end of your attorney modification period to ask for items requiring attention to either be fixed or credited for monetarily. Remember, this only applies for items over $500 (in my contract)...there is some risk involved in buying a home and as NONE are perfect, it's unrealistic to think a seller can or will get it in perfect shape in order to close.

In my board of REALTORS contract the home inspection clause goes longer than the attorney modification clause (10 calender days to 7). It's always wise to get the home inspection done immediately so any potential issues are unearthed and resolution can be found.

People ALL THE TIME want to bypass the attorney. That's your choice, but never recommended by this guy. A REALTOR cannot practice law (unless he or she holds such qualifications to practice as an attorney). I always tell folks mulling over the idea of skipping legal representation, "I'm no dummy but the worst attorney around is going to run circles around me in any sort of legal-based confrontation. Spend a couple of bucks to make sure you're well-covered."

First-time Home Buyer Steps Part 6

Making an offer:

You've found your REALTOR, a great loan and lender and have been out shopping for homes; and now you've found it. The One. Your first house! Your REALTOR can and should do a market analysis on the home to give you a good feel for its current market value (just like he or she would do for a seller to determine the RIGHT price or it).

The next thing you need to do is make an offer on it. This will be in terms of filling out a contract to submit to the seller. The contracts are fairly in-depth and I'll probably go into them at a later date....know this: it is wise to go through every paragraph with your REALTOR. Make certain that you understand what you are signing and it is ALWAYS recommended that you have an attorney.

Once you have settled on an offer price and submitted the offer to the sellers, they have a finite amount of time in which to respond. My board's contract defaults to 3 days to hear back but that can be modified up or down. Sellers are out of town? You can make it 5 days. Property is very active and might sell quickly? Make it one day. Anyone who works with me knows there's no reason to wait in responding...."Get to the gettin'," is my favorite line when it comes to the contract. Even though there may be differing opinions on the price; sellers have a bottom line and buyers have a top dollar- negotiate it out....you'll either get it together or you won't.....but there's no sense in dilly-dallying.

After the initial inking of the contract, all negotiations will be done verbally until agreements have been made on all terms and price. At that point, the buyers will initial the adjustments and the sellers will do the same and sign the contract. Once the listing office (or whoever is holding) receives the earnest money, the deal is fully executed and the buyer has a finite time to conduct the inspection period while both sides are under attorney modification. To learn more about that- check out the next blog!

First-Time Buyer Steps Part 5

Home shopping:

When you go shopping, you're often picky. You squeeze, poke and prod your produce to make sure you're getting the right one. You won't buy jeans that make your butt look big, are too baggy or don't have the right boot cut. When you look at cars you know you want a certain gas mileage, color and options. But for some reason, when it comes to houses- people just want to look look look.

It's cool, I understand it. It's fun to see all the different houses, layouts, decorating, etc. That "fun" wears off quickly, however, on everyone. I find that it helps, significantly, to know what you want in a house. Do you need more than one full bathroom? Do you have a need for more than 3 bedrooms? Is a big backyard a priority with kids or pets? Do you need a "man cave" in a basement? There's a million questions you might have to fit your needs and your REALTOR can search for anything you need. For example: I know there are 45 homes on the market right now in my MLS fitting the needs of a minimum of 4 bedrooms, 2 bath, brick house on at least once acre with central air and a basement. If that was all your criteria- you'd be able to narrow down from there.

You've done your homework. You've picked the right REALTOR and lending needs to get you through the process. Know what you require in a house. It may be something as simple as 3 bedrooms and a 20 miles radius from your place of employment. It may be something totally off-the-wall it doesn't really matter. Knowing what you need to have will eliminate the showings for houses that don't meet those needs at all!

First-Time Buyer Step Part 4

Choosing the right REALTOR for you:

People often use the referrals of loved ones or choose a family member/ friend as their buyer's agent...sometimes a good choice, other times the worst choice possible. Sellers will more often than not, interview a couple of agents- or at very least interview one and make him/her/them earn the position.

However, when it comes to a buyer's agent, people are all too often content to call the agent on the sign of the house their interested in or just call an office and use whoever picks up the phone. Not great choices. Purchasing a home is a major investment and you really should build a great team around you to make certain you proceed with cautious, wise decisions.....choosing your REALTOR is no less important that the right lender, attorney, home inspector, etc. an will often prove to be the most important step in the process.

WHY? Like men, not all REALTORS are created equally. A lot of the things you should be on the lookout for are covered in our Code of Ethics which I blogged about in a muti-part series a few weeks back. Others are covered in our Century 21 Buyer Services Pledge:

• Consult with you to determine your particular real estate wants and needs. This includes providing information as to the advantages and disadvantages of the choices available to you, in order to help you make informed decisions.
• Maintain your confidentiality and represent your best interests throughout your buying process.
• Help you define your financial ability to purchase, explain alternative methods of purchasing and financing, and assist in arranging mortgage financing.
• Provide an action plan for locating the right property, at the right price and terms, in an acceptable time frame.
• Search using available methods to locate the property that will best meet your needs and wants. This may include properties listed with our office, offered through other real estate companies, as well as unlisted properties.
• Show properties that meet your specifications, in accordance with Fair Housing Regulations and ethical real estate practices.
• Disclose material facts known about the property, and other relevant information that is likely to affect your ability to obtain the right price and terms.
• Assist you in evaluating the market value of properties that are of interest to you, and suggest negotiating strategies to help you obtain the most advantageous price and terms.
• As your advocate, advise and assist you in completing your purchase agreement, and present your offer in a light most favorable to you.
• Refer you to other professionals (attorneys, accountants, inspectors, mortgage lenders, etc.) for information or assistance as appropriate.
• Upon acceptance of an offer between you and the seller, monitor all pre-closing activities throughout the process as permitted by law or local practice.
• Consult and communicate with you on a regular basis throughout your entire real estate purchase process.
• Recommend a home warranty to protect you.

Basically you want someone who is going to be in your corner all the way, probably someone who's completed at least a few- hopefully many transactions (though great new agents need to start somewhere too), someone that will communicate with you and is able to be found (not always "out of town"). Bottom line is- you need someone you have a rapport with and that you trust with hundreds of thousands of your dollars.

First-Time Buyer Steps Part 3

Shopping for a loan:

Blogging REALTOR say what?? Shopping for a loan? Come on man, I already picked a lender. Indeed you have (or are at least still weighing your options with multiple)...but really, it helps if you educate yourself. Know how many types of loans there are out there? Like a zillion!

Hey listen, I'm no mortgage expert. If I was, I'd be doing a mortgage & more type of blog. I'm an expert at marketing properties, negotiating, etc. That's why I surround myself with excellent professionals for those things. However, YOU are the one getting the mortgage. YOU are the one (presumably) making the monthly or bi-monthly payments on your house (did you know you can do that- you can). YOU are the one stuck re-financing if you didn't do it right....I'm here to help- but don't be afraid to get your hands a little dirty too.

There's a lot of loans out there and I'm not going to go into a TON of detail here about them (but I will link to proper authorities and came back for more details in the future)....

FHA Loans- helping buyers in one form or another since 1934

• Low down payments 3%
• Low closing costs
• More relaxed credit score needed

USDA Loans, including rural housing- GREAT loans for my market area. Check if a house qualifies right HERE. There are income restrictions- but this is a phenomenal loan program.

VA Loans- I probably should have spent Tuesday's post on this....oh well. If you're a Vet and desiring to purchase a home, this is something you may want to check into. It's a little tougher to get into with more paperwork, but it's good help for those that served.

There's a number of jumbo, adjustable rate, balloon and other types of loan programs (though I'm not sure how much they're being used nowadays) but many people will fall under a fixed-rate or conventional loan. It is still very much suggested that you find out everything you can about the loan to make sure it's the one that fits you best!

The next step is.....that's right, picking the right guy, gal or team to be you REALTOR(s):

First-Time Buyer Steps To Becoming a Home Owner Part 2

Know Your Rights

This should be titled, "Common Sense" or "The Way Things Should Be Everywhere for Everyone" or something like that. Unfortunately, some idiots out there like to take advantage of people or treats different peoples differently. Here are the guidelines as set forth by the Fair Housing Act that prohibits discrimination in housing because of: race or color, national origin, religion, sex, familial status (including children under the age of 18 living with parents or legal custodians; pregnant women and people securing custody of children under 18) and handicap.

In the Sale and Rental of Housing: No one may take any of the following actions based on race, color, national origin, religion, sex, familial status or handicap:
Refuse to rent or sell housing

• Refuse to negotiate for housing


• Make housing unavailable


• Deny a dwelling


• Set different terms, conditions or privileges for sale or rental of a dwelling


• Provide different housing services or facilities


• Falsely deny that housing is available for inspection, sale, or rental


• For profit, persuade owners to sell or rent (blockbusting) or


• Deny anyone access to or membership in a facility or service (such as a multiple listing service) related to the sale or rental of housing.

In Mortgage Lending: No one may take any of the following actions based on race, color, national origin, religion, sex, familial status or handicap:
Refuse to make a mortgage loan

• Refuse to provide information regarding loans


• Impose different terms or conditions on a loan


• Discriminate in appraising property


• Refuse to purchase a loan or


• Set different terms or conditions for purchasing a loan.

In Addition: It is illegal for anyone to:

• Threaten, coerce, intimidate or interfere with anyone exercising a fair housing right or assisting others who exercise that right


• Advertise or make any statement that indicates a limitation or preference based on race, color, national origin, religion, sex, familial status, or handicap. This prohibition against discriminatory advertising applies to single-family and owner-occupied housing that is otherwise exempt from the Fair Housing Act.

Religious or not, you're pretty safe if you follow the old Golden Rule and treats others how you would wish to be treated.

First-Time Buyer Steps To Becoming a Home Owner

So, you're ready to buy a house. I am developing this as a first time buyer's guide- but most of the principals apply to anyone in the market to purchase a home. I cannot imagine this going off in less than 10 parts- I could probably do 5, but they'd be long and you'd get bored and read someone else's less-boring blog. Without further ado:

First-Time Buyer Steps To Becoming a Home Owner Part 1

Get Pre-approved:

When one decides to purchase a home it's an awfully exciting time. It's VERY easy to jump right in and start looking at homes. It is, however, a poor decision. The first step one should take is acquiring a pre-qualification or pre-approval. WHY? Simple. You want to know where you stand as far as buying power. If you want a $200,000 house but your buying power really limits you to under $170,000 you need to know. From there you can either purchase what you can afford or wait and save till you can afford more. A real estate agent can and will refer you to lenders (probably multiple so you can make the best choice to meet your needs).

What is the difference? The difference between a pre-qualification and pre-approval is basically documentation and verification. See, to attain a pre-qualification you simply tell the lender of your income, debts, etc. and he or she can estimate numbers based on your words (so don't fib- it won't help anything). A pre-approval, however, takes documents such as (but not limited to) proof of two years of work history, pay-stubs or income tax forms, copies of bank statements for source of funds verification and copies of charge card statements and runs a credit check in order to estimate your ability to pay a certain amount per month That estimated monthly payment can be transferred to a certain loan limit and more often than not (at least in this area) is given as 'Congratulations Mr. X. Our Bank has pre-approved you for $150,000 [and so on]'

Once you're set on a price range that you CAN afford and knowledge of where your MOST COMFORTABLE payment range will be and are armed with a pre-approval, you can get out and look look look. But first you need to be aware of your rights and find a loan that works for you! More on this Wednesday!

Tax Assessments

I just received my Grundy County revised tax assessment letter in the mail and am betting that you have as well. If you haven't, you probably will soon. Generally this brings up one question from local townspeople, "What the heck? My assessments are up! My taxes are going to go up! How do I stop this???"

Well, if you must- you can file complaints with the board of review until 30 days after the date of publication of the assessment list (mine is 11/5/08)...so I have until early December.

BUT, it's a pretty easy formula to figure out if you're paying too little, too much or if it's just right (just ask Goldilocks). Multiply the assessed value times 3 and that is what they have your property's market value at. If it's above where you think it's feasible to sell your property at- you might have a legitimate beef. If it's below, you should count your blessings that you're being taxed less than you probably should be.

Low Ball Offer: A Seller's Perspective

I was networking with some agents from around this great country of ours the other day and one was wondering about lowball offers on our listings and how we react to it. I don't. I'm usually quite confident in my pricing. I have a good history of selling homes at the price range I've told sellers they should sell in. However, a home is only worth what someone is willing to pay for it! Sellers need to realize this. Everyone is out for a deal, now, more than ever.

By law we as REALTORS have to present the offer to the you, the seller. If someone offers 50 bucks on your million dollar estate, I've got to let you know. Here's the deal: it doesn't bother me. If I'm confident on our pricing and the offer is significantly lower, I'm disappointed- but WE'RE ONLY JUST BEGINNING! No one says a seller must take it.

Sellers need to find the positives in an offer. Is the buyer well approved? Does the buyer want to close the property in a time frame that works for you? ETC. Often times, the rest of the contract will be largely agreeable (or easily negotiated)- leaving price as the only hurdle. One thing I'll always tell a disappointed seller, "You are X dollars closer to where you wanted to be than you were an hour ago."

It sounds a little hokey, but it is absolutely true. There's a couple of things going on in a buyers mind when making that low offer.

• Let's just see how motivated/ desperate they are to sell.
• I'll kick myself if I could have got this house cheaper- so let's go in a little low
• They're so overpriced we have to come in somewhere

These are some of the many rationales used for low offer price. They are ALL VALID. So your house is listed at $200,000 and they came in at $160,000. Maybe they only feel that it's worth 180k and just want you each to split the difference. COUNTER THEM!!!!! Worst case scenario is you never get a deal put together- best case; you sell your home= GOAL ACHIEVED!

I'm earnest....honest

One thing in real estate that is often unspoken of until needed is earnest money. Often times buyers of real estate don't remember about it and most times, first-time buyers have never heard of it. So what is it? It is money that accompanies the purchase agreement to show that the buyer is serious about buying the property; earnest being synonymous with honest....in lay man's terms- it's money that shows you're not going to flake on the deal. These funds are not in addition to the purchase price, they end up being put toward the purchase. For example, if the purchase price is $200,000 with $2,000 in earnest money, the buyer need only come up with an additional $198,000 to fulfill his/her/their commitment.

In my market area, one to two thousand is usually enough earnest money to be considered acceptable- but keep in mind every seller can hold a buyer to whatever he/she/they want. 1% of the purchase price would be nice to see and it would be great if it became an industry standard- it could take all the guess-work out of it. "How much will we need in earnest money?" "2 grand? Yikes- think they'd settle for one?" "Can I get away with 500 bucks, ya think?"

General rule of thumb, the more the better. Think of it as a collateral. If you let me borrow your car and asked me to be earnest (honest) and leave something to assure that I'd be back with it and I offered you a pack of bubble gum or one of my kids- you'd want the kid right? Sure! I'll steal your car and buy a new pack of Big Red as I fill up the tank- I'm certain to come back for my kid.....................even if you've got a cherried out '69 Camaro! Bottom line is- the more you put up, the more it shows you're serious about a house.

Buyers can lose their earnest money by backing out of the deal after the purchase agreement has been accepted by both parties. Once a seller accepts an offer on the property, showings will often dwindle or cease altogether, so if a buyer backs out, at least they have something to show for that time wasted.

Inspection Credit

When one is purchasing a home, it is ALWAYS strongly advised that he/she/they have a home inspection. Once the contract is negotiated and accepted, a buyer will have a specific number of days to have both a home inspection and attorney modification- it's negotiable, so the the number of days can change.

I'll go into specifics of home inspections in future blogs- this one jumps the gun and talk about what to do once said inspection is complete. A buyer has a right to ask the seller to repair or give credit for issues found in the home.

BUT a provision in the contract that is OFTEN overlooked is: The Parties agree that repairs which do not exceed $500 in the aggregate to remedy,shall be considered minor deficiencies for the purpose of this Paragraph, and buyer agrees to assume those repairs with no allowance from Seller.

This is my blog for today because I have a buyer purchasing a listing of mine for a good $10,000 under it's market value and nit-picking over $100 in menial repairs. Uggh. It really should be your REALTOR's job to explain that provision on either side of a deal (buyer or seller). Houses aren't perfect- NONE. A 50 year old house has flaws. A 5 year old house has flaws. A brand-spankin' new house has flaws. There's a little bit of buyer beware to be had, and that's why a great home inspector should NEVER be overlooked.

Where I go I just don't know, I might end up somewhere in Mexico.

Market Time Myth

When showing houses, one of the big questions that is almost certain to join "What's the square footage" is "How long has it been on the market?" You'd think it's a viable question but it many aspects it is not. A home might have a market time of 30 days or one of 300....does that impact its value? NOPE. That house is worth, call it, $200,000 either way.

Now I'm not oblivious to the wheeling and dealing in real estate by any means- I'm quite the established negotiator. I understand a buyers thought that 'If it's been for sale a long time, we might be able to low-ball them and get a great deal." It's possible- though usually not likely.

But the notion that a house becomes worth less money because it's been on the market a long time slays me. A house has an extended market time because the BIG 3 have not been satisfied to procure a buyer....but most importantly because of its price. If that same $200,000 house hit the market at $240,000- there's no wonder why it's been on for a long time.

There are plenty of reasons why houses become worth more or less money- but market time really is not one of them.


Since I missed yesterday's post you get two Rocktober quotes today:

Are you gonna take me home tonight? Ah down beside that red firelight?

He said, "Hey there, fellow with the hair colored yellow whatcha tryin' to prove?

Get that buyer!!!

How does one attract the buyer for the home he/she is trying to sell? Giant bug zapper and hope that they have a bunch of money in their wallet? Could work- might try it.



It's illegal to grab a buyer by the scruff and force them to buy a home....I haven't tried it and won't tempt the penal system until I have confirmed that legislation has passed allowing me to do that. Until then there are three things that you can control to get buyers to look at a home and make offers.

1. Marketing


2. Presentation


3. Price

• Marketing- I can assure you that you NEED to have your home marketed well. You can have the nicest home around at a phenomenal price- but if no one knows it's for sale, it's not going to sell. This one is on your agent/ brokerage to get done for you unless you are selling unrepresented, in which case, it's all yours!

• Presentation- A home needs to look good enough from outside (curb appeal) for people to want to go in. The home needs to continue to look good for showings. This really should go without saying- but I show far more homes that are not "showing ready" than I do that are ready. You can have a good price and let everyone in the world know about it- but if the home isn't nice, who's going to want it? I'll sell you my smelly old gym shoes for $5. It's probably an appropriate price for what remains a halfway decent pair of NB running shoes- but if they smell like 100 hours of my sweaty feet, does that make them something you want to buy, just because it's priced right and you know it's available? I doubt it. This one's on the owner- make that house sparkle!

• Price- Your real estate professional should be able to give you a price range value for your home and reasonable evidence to support it. What you do with it is your choice. If your home is overpriced, no amount of marketing is going to overcome it- even if it shows beautifully. WHY? Because there's a ton of other homes available! If a buyer doesn't like yours- even in the smaller markets like mine- there's two or three other options. This is a joint venture. Ultimately the owner will pick a price- hopefully it's in line with his/her real estate professionals market analysis conclusion of value.

Interest Rates- they are a fallin'

Freddie Mac, one week ago, released the results of its Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 5.93 percent with an average 0.7 point for the week ending September 11, 2008, down from last week when it averaged 6.35 percent. Last year at this time, the 30-year FRM averaged 6.31 percent. The 15-year FRM this week averaged 5.54 percent with an average 0.7 point, down from last week when it averaged 5.90 percent. A year ago at this time, the 15-year FRM averaged 5.97 percent.
What's it mean to you?

If you are an active buyer of real estate- it means not only is inventory extremely high, but now interest rates are at a ridiculously low rate too! If you're on the fence to buy, I can promise that this opportunity will not be around too long and who knows how many years it'll be before we have a buyers market like this again... If you're a seller, it's a great thing because there should be more buyers out there with the potential to purchase your property!

Size DOES Matter!

One of the most misunderstood and erred upon matters in real estate is square footage. It's a dinosaur of a way of evaluating homes in the opinion of many. I've been a REALTOR for a little over 5 years and I would say those using (or not using) square footage in their listings in this area has consistently been less than 20%. I don't think I'd be too far out on the ledge saying the number is probably closer to 10% of MLS listings in the greater Coal City area actually use it.

WHY?

It could be a multitude of reasons, really. The biggest of these is that very few know how to do it properly. I just relisted a 1350 square foot home that was previously listed at over 1500 square feet. There may be a matter of only 200 feet difference, but that's about a 16% larger home and a difference in about $20,000 to those that base solely on square footage (a mistake).

There is a rising amount of legal action being pursued because of errors in square footage reporting. MOST of these are due to inability/ lack of proper knowledge to do it correctly rather than any attempt to dupe home buyers.

So how do you figure it?

Unfortunately there is NOT one universally agreed upon way to measure a home's square footage- a likely reason for such disparity. However, I think that most elementary school children can use a ruler and that all who can become licensed to sell real estate should surely be able to measure....the question is less on HOW to measure and more on WHAT COUNTS!

LIVABLE SPACE!!!

Living area (sometimes referred to as "heated living area" or "heated square footage") is space that is intended for human occupancy and is:

• Heated by a conventional heating system or systems (forced air, radiant, solar, etc.) that are permanently installed in the dwelling - not a portable heater.
• Finished, with walls, floors and ceilings of materials generally accepted for interior construction (e.g., painted drywall/sheet rock or panelled walls, carpeted or hardwood flooring, etc.) and with a ceiling height of at least seven feet, except under beams, ducts, etc. where the height must be at least six feet four inches
• Directly accessible from other living area (through a door or by a heated hallway or stairway).

Closets, entryways, foyers and hallways, garages and attics are subject to the above criteria for determining if they count or not. In a "typical" home a garage and unfinished attic would NOT count but a hallway, foyer, entryway and closet would because it is heated, has flooring walls and ceiling- although I could see one's argument that you don't really "live" in a closet too.

REALTOR Code of Ethics (part four)

This is part four in a four part series on the REALTOR Code of Ethics. As always, to keep you from falling asleep, it's just a tip-of-the-iceberg deal. Go HERE to check out the full code.

#13) Shall not practice law unless they are a lawyer.

• Should be enough said. If I had a law degree, I probably wouldn't be a REALTOR, haha.

#14) Shall cooperate if charges are brought against them and present all evidence requested.

• If charged with an unethical practice, we merely must display the facts and prove innocence---or guilt, as I suppose could be the case.

#15) Agree not to bad mouth competition and agree not to file unfounded ethics complaints.

• I won't say much anything about a competing agent. I think there are very few in my region that could actually compete and do the job as well as I can- and those that could...why would I have anything negative to say about them?
• In all seriousness- there's no reason for this talk. It's like dirty politics and not my game. I'll let you know what I will do for you and nothing beyond that really matters to me.

#16) Shall not solicit another REALTOR'S client nor interfere in a contractual relationship.

• Any agent that attempts to sway another to use him or her while under contract with another basically falls into this. If you read my blog while your house is listed with another agent- I'm not trying to steal you. The same if I send you a general piece of mail or run into you up-town and mention my services (IF I don't know you're under contract).
• Now if you're under contract and you come to me, we may discuss the terms upon which we might enter into a future agreement or, alternatively, may enter into an agreement which becomes effective upon expiration of any existing exclusive agreement. I cannot and will not tell you "how you can get out of your current listing." It's in your contract and should be discussed with your current agent/brokerage.
• The fact that one agent sold you a home does not preclude any agents from soliciting you for your future business.
• As a buyer's agent on unlisted property, we must disclose that relationship to the seller and make any request for anticipated commission at first contact.

#17) Shall submit to arbitration to settle matters and not seek legal remedies in the judicial system.

• Instead of taking it to the courts, we settle disputes "in house" through our board of REALTORS...a nice break on taxpayers money, I'm certain.

I hope this four part series was able to educate you on the REALTOR Code of Ethics and what separates us (REALTORS) from regular old sales agents. If you have any questions that I can clarify- don't hesitate to ask me!

REALTOR Code of Ethics (part three)

This is part three in a multi-part series on the REALTOR Code of Ethics. Parts one and two can be found in previous posts. As always- this is just tip of the iceberg kind of stuff, to inform yourself even further I urge you to check out the code HERE.

#8) Shall not co-mingle client funds with their own.

• I don't think you REALLY want us to co mingle your funds with ours do you? Don't want your earnest money check going to pay my satellite bill now!

#9) Shall attempt to ensure that all written documents are easy to understand and will give everybody a copy of what they sign.

• I cannot help SOME legalese in contracts and whatnot- but WILL explain things in layman's terms. I'll also provide you a copy of everything you sign, if I'm not able to immediately where we are (for lack of copier), I will make when when possible.

#10) Shall not discriminate in any fashion for any reason on the basis of race, color, religion, sex, handicap, familial status, or national origin.

• It's utterly disgusting in the "melting pot" of America for anyone to do this under any circumstances- I don't think I need to expound further on the topic sentence.

#11) Expects agents to be competent, to conform to standards of practice and to refuse to provide services for which they are unqualified.

• When REALTORS® provide consultative services to clients which involve advice or counsel for a fee (not a commission), such advice shall be rendered in an objective manner and the fee shall not be contingent on the substance of the advice or counsel given. For instance, I could charge you $200 for a comparative market analysis...but I couldn't do it on a sliding scale depending on my report back to you.

#12) Must engage in truth in advertising.

• We've got to let you know we are REALTORS and thus, professionals in the industry. I had a situation the other day where a new newspaper ad ran and erroneously the newspaper publisher left all my REALTOR and brokerage information off the ad- needless to say it was remedied quickly.
• The offering of premiums, prizes, merchandise discounts or other inducements to list, sell, purchase, or lease is not, in itself, unethical even if receipt of the benefit is contingent on listing, selling, purchasing, or leasing through the REALTOR making the offer. However, REALTORS must exercise care and candor in any such advertising or other public or private representations so that any party interested in receiving or otherwise benefiting from the REALTOR’s offer will have clear, thorough, advance understanding of all the terms and conditions of the offer.
• These truths also apply to the Internet: When it becomes apparent that information on a REALTOR’s website is no longer current or accurate, REALTORS shall promptly take corrective action.

REALTOR Code of Ethics (part two)

This is part two in a multi-part series on the REALTOR Code of Ethics. Part one can be found below this post. Again, this is a brief run-through of the code and the full thing can be found HERE.

#2) Shall refrain from exaggerating, misrepresenting or concealing material facts; and is obligated to investigate and disclose when situations reasonably warrant.

• If you have a leaky roof or faulty foundation and want to hide it...don't call me to be your listing agent. I won't hide it for you. I cannot, however, go beyond my scope of being a REALTOR....meaning, I can't be the judge what is good working, solid, safe building---that's what home inspectors are for. I WILL help you find the best home inspector in the area though.

#3) Shall cooperate with other brokers / agents when it is in the best interests of the client to do so.

• In my humble opinion- it's ALWAYS in the best interest to cooperate with other brokers. In no way, at all costs, do I step in the way of any brokers attempting to show/sell your property and I think it's an unwise business decision to not use the MLS to its fullest.

#4) Shall not acquire an interest in or buy or present offers from themselves, any member of their immediate families, their firms or any member thereof, or any entities in which they have any ownership interest, any real property without making their true position known to the owner or the owner’s agent or broker.

• In selling property we own, or in which we have any interest, REALTORS® shall reveal our ownership or interest in writing to the purchaser or the purchaser’s representative. You'll find this in advertisements as well, AGENT OWNED is and will be displayed. All disclosing of this must be done prior to acceptance of contracts.

#5) Shall not provide professional services in a transaction where the agent has a present or contemplated interest without disclosing that interest.

#6) Shall not collect any commissions without the seller's knowledgee nor accept fees from a third-party without the seller's express consent.

• When recommending real estate products or services (e.g., homeowner’s insurance, warranty programs, mortgage financing, title insurance, etc.), REALTORS® shall disclose to the client or customer to whom the recommendation is made any financial benefits or fees, other than real estate referral fees, the REALTOR® or REALTOR®’s firm may receive as a direct result of such recommendation.
• We also shall not recommend or suggest to a client or a customer the use of services of another organization or business entity in which they have a direct interest without disclosing such interest at the time of the recommendation or suggestion. For instance if I co-owned a home inspection company with my spouse or brother- I'd have to let you know of my interest in the company beforehand.

#7) Shall refuse fees from more than one party without all parties' informed consent.

• My pay goes through Century 21 Coleman-Hornsby and Century 21 Coleman-Hornsby only for all real estate duties...no check under the table, no money for referrals from ANYONE that is not a REALTOR

This is part two in a multi-part series....Articles 8-17 will be covered in the coming days.

REALTOR Code of Ethics (part one)

Believe it or not; not all real estate salespeople are REALTORS. REALTOR is a registered trademark which is often, erroneously used to refer to the whole industry much like Kleenex is used to define tissue. Simply put, a REALTOR belongs to the National Association of REALTORS.

In belonging to said group, we subscribe to and live by the REALTOR Code of Ethics. The Code of Ethics is strictly enforced and contains 17 Articles and various underlying Standards of Practice. The Standards are much more restrictive and confining as to conduct than those governing agents who simply hold a real estate license.

In this multi-part series, I will explain the 17 articles and what they mean in layman's terms. I won't be able to hit every single standard without putting you to sleep- so it is recommended that you follow the link to check out the code yourself:

#1- Pledge to put the interests of buyers and sellers ahead of their own and to treat all parties honestly and fairly.

• There are many times in my line of work where it is in MY and my family's best interest that a property under contract closes and I get paid. In fact, that is probably always the case. However, I act on behalf of the best interest of my client. This is of particular interest in working with buyers...I cannot tell you how many 'deals' I've had go south (fall apart) because my recommended home inspector found problems/issues that were beyond what an initial showing or two found. Too bad for me. My duty is to make certain that the home you purchase is one that you're going to be happy in for as long as you want to be.


• It goes beyond this too- if I'm attempting to procure a listing, I cannot and will not deliberately mislead you into believing your home is worth a certain price just to get my sign in your yard.


• I won't reveal confidential information. If you have to hit a bottom line, I'd never let on to a buyer of your house or his/her agent unless you wanted me to. Vice versa, if I knew you'd pay a certain amount for a home- but offered less- I wouldn't give away that you're testing out a seller. Basically anything that puts you at a disadvantage- not coming from me.


• If and when you list with me you'll know the cooperating commission paid (portion of the listing commission that is paid to potential buyer's agent) and be aware of any possibility of dual agency (which you'll have to agree to prior to my showing your house).

In the coming days, I'll knock out the remaining 16 articles in the REALTOR Code of Ethics.

Not-so Secret Agent Man Part Five...the end

This is the final segment in a five part series on The Consumer's Guide to Real Estate Agency in Illinois. The final part has to do with exclusive brokerage agreements.

Exclusive Brokerage Agreements

• Sometimes, your agent will ask you to sign an exclusive brokerage agreement this means that you are agreeing to work only with the real state brokerage company and designated agent(s) named in the agreement to the exclusion of other real estate firms and agents
• If you are the seller, the contract will likely be called an Exclusive right to Sell or an Exclusive Agency Agreement
• If you are the buyer, the contract will likely be called an Exclusive Right to Acquire, Exclusive Right to Purchase or Exclusive Buyer Agency Agreement
• Under an exclusive brokerage agreement, the designated agent(s) is required by the Illinois Real Estate License Act of 2000 to provide certain minimum services. These services generally include:
• ***Accepting and presenting offers and counteroffers
• ***Assisting you in the preparation of offers, counteroffers, etc. and
• ***Answering your questions related to negotiations in a real estate transaction

And that's about the bare minimum any agent could offer- service-wise. And if that's all you're getting from your agent, you may consider upgrading.

Not-so Secret Agent Man Part Four

Today is the trickiest of trickies in regards to real estate agency. What separates a customer from a client?

Treatment of Customers as Opposed to Clients

Sometimes someone on the opposite side of your transaction will not be represented by a real estate agent, in which case your agent will give that party a notice that tells that person the agreement represents you only.

• The notice might be called a Notice of No Agency Relationship
• It will allow the agent to do certain clerical or ministerial acts for that party for your benefit
• Some examples of ministerial acts might include:

1. Talking to an inquiring consumer about availability and pricing of brokerage services (If someone calls me to inquire about my services they are NOT a client....yet)
2. Responding to phone calls from a consumer about price or location of a property (I can answer questions about my or other listings without you being constituted as a client)
3. Setting an appointment to view a property
4. Completing business or factual information on a contract for the consumer but on your behalf (This would come up in a situation where I represent a buyer purchasing an unrepresented seller aka: for sale by owner)

• If you are a customer and not a client you should receive a Notice of No Agency Relationship
• ***You should not disclose anything to the agent who is treating you as a customer that would be confidential to you, i.e. anything that might hinder your bargaining position, or anything you would not want the opposite party to know (It would really be in your best interests to NOT say what price/ terms of a potential deal would be good for you)

This is part four of a five part series on The Consumer's Guide to Real Estate Agency in Illinois. Parts one through three are below.

Not-so Secret Agent Man Part Three

Today, we get a little bit tricky in learning about agency disclosure. Again, real world applications in parenthesized green italics:

Required Agency Disclosure Under the Illinois Real Estate License Act of 2000

No later than entering a brokerage agreement (can be a verbal agreement), you must be advised of the following from the brokerage company:

• That a designated agency relationship exists
• The name of your designated agent(s) in writing
• What the brokerages company will be paid and the company's policy regarding payment of other brokerage companies that might be involved in your transaction (This is more prevalent in a listing agreement. You wouldn't let your agent list your property without negotiating a commission to be paid, would you? Make certain you know what your agent intends to pay out to a buyer's brokerage-should there be one.)

Disclosed Dual Agency

• Sometimes a designated agent can represent both you and the opposite party in the transaction (Example: I have a listing that a potential buyer contacts me to see)
• Before doing so, the agent must have the informed written consent of both parties (Usually this will be discussed with a seller at time of listing the property for sale)
• If your designated agent might act as a dual agent, he/she/they should speak with you about the potential for dual agency and give you a disclosure form entitled "Disclosure and Consent to Dual Agency" for your review
• ***You will see that the agent's role becomes limited when you have dual agency
• ***You are under no obligation to consent to disclosed dual agency
• If you do consent, you must sign the disclosure form before the agent acts as a disclosed dual agent
• ***Sometimes, this language will be included in your written brokerage agreement (Like it is usually discussed in the listing agreement- ALWAYS with me- it is also discussed at time of agreeing to use an agent as an exclusive buyer's agent)
• You will be asked to sign a confirmation of your consent to dual agency no later than when you sign a purchase or lease contract (This is a last gasp attempt at being legal. In reality you have read that it should be signed at listing and when becoming an exclusive buyers agent OR before viewing property with an agent that also has it listed)

I think it's important to note that this only applies in situations with an AGENT, not a brokerage. For example- if I show you a listing of MINE, the sellers and you would need to consent to dual agency. If you show you another Century 21 Coleman-Hornsby listing that is NOT MINE, it does not apply.

This is part three of a five part series on The Consumer's Guide to Real Estate Agency in Illinois. Parts one and two can be found below.

Not-so Secret Agent Man Part Two

Today I tackle some of the things you should expect your real estate agent to do (designated duties) and some things that if he/she does is not a violation of agency duties (so don't get mad).......In parenthesized green italics- I'll give some real-world, non-legalize, examples):

Designated Agency Duties Under the Act

• Perform according your agency agreement.
• Promote your best interests as follows:
• -Seeking a transaction that meets the terms of your agency agreement or that is other-wise acceptable to you.
• -Presenting all offers to you and from you unless you direct your agent to do otherwise. (Even those offers that my buyers make that could be considered laughable, I'm obligated to present. Flip side of that: if your representivie brings in a very low offer on a listing of mine, I'm obligated to present it to the sellers, even if you offer $1,000 on a million dollar listing!)
• -Disclosing material facts about the transaction that the agent actually knows about and the information is not confidential to someone else. NOTE: Material facts typically will not include information related to property that is not the subject of the transaction, that is a fact situation not related to the subject property or occurrences related to the subject property.

• -Accounting for all money/ property received from you or for your benefit.
• -Obeying your lawful instructions.
• -Promoting your best interests above the agent's or someone else's best interests. (I.E. doing what's BEST for YOU regardless of how it affects me. It would be easy, in a comissio-based business, to cut corners or hide facts to get deals closed so that we, the agents, could make money. This should be obvious that behavior like such as this is NOT ALLOWED!!!)
• Exercise reasonable skill and care in performing brokerage services.
• Keeping your confidential information confidential.
• Complying with the Illinois Real Estate License Act of 2000 and other laws that might apply, i.e. fair housing and civil rights statutes. (Please never tell me to NOT show or sell property to a minority or someone of a different ANYTHING than you. I will show/sell property to ANY interested, qualified purchaser.)

What are NOT VIOLATIONS of Agency Duties???

1. Showing the same or similar properties to more than one interested buyer or tenant client. (The house/property is going to be sold at some point...if you dilly-dally and someone else wants to see it- there's NO justifiable reason why I cannot help an interested buyer procure it.)
2. Being compensated a higher fee if the purchase/lease price is higher. (Since commission is based on percentages- it will almost ALWAYS be a higher fee if a higher priced property is purchased/sold. Example: 50% of $1,000 is $500. 50% of $8,000 is $4,000....I used 50% so as to avoid all price-fixing issues that may arise- but, by all means, if you ever want to pay 50% for me to represent you, I'll oblige.)
3. Providing false information to you if the false information was given to the agent by a customer and the agent did not know the information was false. (If a seller fills out a disclosure and it says there is no known electrical issues in a home and I report that back to you- you cannot blame me if there really ARE electrical issues. I don't have x-ray vision and will ALWAYS recommend a home inspection be done.)

This is part two in a five part series on The Consumer's Guide to Real Estate Agency in Illinois. Part one can be found HERE.

Not-so Secret Agent Man Part One

Agency is something VERY overlooked in real estate. It doesn't merely apply to an office or company as in, "so and so is working for the town's top real estate agency" (like it's a modeling agency or something).


It (agency) clearly defines who we, as real estate salespeople/brokers, are representing; be it buyers, sellers or both.

*Agency is a legal framework that allows a person to act through a representative.

*Common examples include:

• An attorney representing you in a business transaction.
• A stock broker buying and selling investments on your behalf.
• A real estate broker assisting you in buying, selling or leasing real estate.

*Under the Illinois Real Estate License Act of 2000 your real estate agent (not ALL are REALTORS) will owe you certain statutory duties that are similar to fiduciary agency duties.

Designated Agency in Illinois Real Estate Transactions:

• An arrangement where one or more agents from a real estate brokerage company are appointed as your legal/designated agent.
• You will be presumed to be represented by the real estate agent you are working with unless you have a written agreement otherwise.
• Other associates in the brokerage firm may be designated agents for other buyers or sellers and may be the legal agent of the opposite party in your transaction.
• Even though your brokerage agreement will be with the real estate company, you will have a designated agent(s) to act on your behalf.

This is part one of a five part series on The Consumer's Guide to Real Estate Agency in Illinois.