Ever hear the term "ready, willing, and able" buyer?  When a person lists their home, they have the right to expect everyone viewing their home financially qualified to purchase in their general price range.  For instance, if I have a client who has been pre-qualified by a loan officer for a house price not to exceed $100,000, I am not about to show that client $200,000 homes.  If the buyer is an investor who wants to bid on foreclosures, I don't have to explain to them that banks will more than likely never take fifty cents on the dollar.  I will do research to find the best deals available and if this investor wants to pay pennies on the dollar, we'll look at auctions and bid.  Many foreclosures are already priced well below value.  In instances where foreclosures are not well priced, the investor will pass on that listing.
 
Investors generally call, identify themselves and their bank, and want to proceed quickly.  While the average person is looking for a home with value and they have time to look at properties, they must also be pre-qualified.  I do not want to know your personal business.  I will never ask your loan officer if you are a millionaire traveling incognito.  However, I definitely want to know that you have at the very least been pre-qualified.  There is an area on listings where the listing agent can write comments that can only be viewed by other agents.  If the listing is a foreclosure, I'll be instructed to not only have my client pre-qualified before viewing the property, I should call "Loan Officer X" and have that loan officer pre-qualify the buyer before making an offer. No pre-qualification, don't make an offer. When it comes to million dollar plus properties, BEFORE you can even see the property, I have to fax over your pre-qualification letter or a "source of funds" letter if paying cash.  I don't want you to empathize or sympathize with the seller - just understand their non-emotional business sense.  It's just business!  You will not be given access to their home if you cannot produce a letter from a lender or bank regarding your financial ability to purchase.  Listing price is another word for asking price so yes, you will negotiate your head off - that's business.  You won't be able to get to first base without credentials.  As a REALTOR, it is my business if you're qualified to purchase.  Other wise, we are just wasting everyone's time and money!

I may have touched upon this subject before and it is occurring again with greater frequency.  I got a call this morning from a frantic buyer who wanted to see a listing RIGHT NOW.  She never mentioned she had an agent, but the second she gave me the mulitlist number, I knew she did.  I returned her call but got put into voicemail.  Four hours later, her "agent" called.  It was 4:15 and she just finished her day at her job in downtown Atlanta and wanted me to race over to my listing and let her buyers in.  I explained I was busy with clients myself.  "But you HAVE TO help me, I need to pick up my child and get home quickly because the babysitter's coming.  I've had a rough week and we go out to dinner on Friday nights."  I suggested she call her backup agent at her office.  Silence.  She didn't know what that meant.  I told her the client actually belongs to her brokerage house, call her broker to assist the clients. 
 
Whenever I leave town which is rare, I have about four other agents covering for me.  In the event Agent A is busy and can't assist either my client or someone inquiring about my listing, Agent B should be able to assist.  I still have two other "go to" agents in the event I can't get the first two on the first ring.  If your agent doesn't have a backup agent or agents, at the very least, their broker should assist you.  Furthermore, you are not working with a professional agent if he/she does not have a system in place for contingencies such as coverage while I'm out showing other clients, illness, vacation, and so forth.
 
There is a term called "procuring cause" and another called the "threshold rule."  Since I ask up front if a person has an agent, I probably won't inadvertently be taking another agent's client out to see property.  If I take your client over the threshold of a house and show it to them, it will be logged into the lockbox on the door establishing when and what time I took them over the threshold.  If I take your client over the threshold of a listing, you are not getting paid.  I'm quoting now from the National Association's Board of Directors adopted Official Interpretation 31 of Article I, Section 2 of the Bylaws amended in 1977 providing in part: [T]he Board or its MLS may not establish a rule or regulation which purports to predetermine entitlement to any awards in a real estate transaction. If controversy arises as to entitlement to any awards, it shall be determined by a hearing in arbitration on the merits of all ascertainable facts in the context of the specific case of controversy.

The moral of the story is....if you want a career in real estate that pays really well, you have to work it! 

Showing homes in Atlanta is not what it used to be! First of all, I hate showing "Appointment Only" homes.  They are never ever easy to make an appointment with, and they are for the most part a difficult sale.  I like to think that it begins with "Tude" and ends with it.  This market does not help matters any.  Before I show homes, I've gotten into the habit of checking tax records to see if the home seller is upside down.  Georgia has some very different way of doing business, and one of them is not to announce the home is not an "Approved short sale!'  That exercise along is time consuming.  Recently I was showing homes in Atlanta area and trying to caravan the route before I went out to show.  It is so much easier when you have a route planned ahead.  Sorting the showings into a caravan route it is the smartest use of time management we have.

This particular day, the showings were going to be on different sides of the county.  So I had five homes to show, and was only able to get 2 agents to return my call.  Another home was basically a ‘for sale by owner" listed in the MLS.  I had to call him twice, and two other homes one agent returned my call within the hour.  That was reasonable.  However the first home I wanted to show, the agent would not return the call.  It is frustrating, one holdout!  I left several more messages throughout the day to show this "Appointment only" home that had been listed since May 2009 and reduced over 60K in price, but there was no response.  I tried calling again, and again, and again.  Finally, about 9 PM I receive a call from the agent, and the agent says "That time won't work...they are going to church!"  My response is that, and then we will pass on showing the home, because I had no other choice to go ahead and plan out the whole day.  I mentioned to the agent, "You should have called earlier! The agent went postal on me!  "I've been out on the golf course the entire day, and I do not take my cell phone with me when I play golf! And Besides, I just got in!"

That really got me hot under the collar.  First of all, I work real estate full time, and that does mean weekends.  Now, the agent expected me to rearrange the entire schedule again at this late hour.  Not going to happen!  My response was, "No, if I cannot show it at that time, we will not show it at all!  It's not my problem you played golf all day, and did not answer the phone!"  The agent allowed us to show the home.

The next day, I showed the home.  There is no family living their as the other agent implied.  It was just a single bachelor, and he was not the owner but a house sitter.  He stayed at the home during the entire showing, and had no intentions in going to church at all.   The point I am making is that usually in real estate we do work weekends, and we are pretty much always available to show our own listings.  If not, I have someone else cover for us.  How do you explain to an owner the reason the home is not being shown is that other agents cannot contact you to show, because you do not want to be interrupted for a day as you play golf!  The seller was going to have to come to the table with over 60K on this home, plus commissions and concessions, and their agent is too busy playing around, and covering their own butt!  Isn't life grand?  The sellers, sit and wonder why the market is so bad!

I went on a listing appointment recently in a neighborhood where the homes were at one time priced over $400,000.  Keep in mind, that in this economy, even the $100,000 houses have to be outstanding and have granite kitchens because the short sales and foreclosures have taken prices down - in every neighborhood including your gated, exclusive golf community.  This particular house has been listed twice before by decent agents, but they bought the listing.  In other words, they've told the sellers whatever they want to hear so they could secure the listing.  Why would anyone put themselves through that aggravation when the house will sit?  To agents like that, real estate is a numbers game, list 100 sell any 10. 
 
The main problem is with the ego of the seller which becomes evident as I walk the house with the husband.  Their house was built with tighter screws, longer nails, thicker glue, better air conditioning filters, and a new Price-Pfister faucet in the kitchen (in the old sink).  They've been to their neighbors houses.  Filthy places with children's hand-prints everywhere, dog drool, cheap paint.  Their house is better all around and they're going back to their home state where everyone is clean and has better houses.  They've put tens of thousands into their home.  I guess they don't know that I have access to appraisals and old FMLS listings with photos that are archived and the new "hand kilned Italian" tile they put in the screened-in area at a cost of $15,000 was there when they bought the house from the previous owner. I would have known when the tile was laid because the child living there previously had one small tile in the far corner with her name and date on it.  They also said they put the screened in area in themselves.  I know this isn't true because I saw the footers poured for it when I went to the community open house the builder hosted over six years ago.
 
As I sit with the husband in the kitchen, I ask if his wife will be joining us.  She greeted me at the door and scurried to the basement because she works out of the home.  He's not happy.  He walks over to the basement door, calls her upstairs and she plops down, frowns, glances at him, smiles, and exhales like a dragon, crossing her wings, I mean arms.  I simply need to know their motivation to sell this time.  I think fast:  should I ask what do they think went wrong when they were listed it last time?  NO.  If I do that, it may imply they did something wrong.  I know they did - they were greedy and worked with an agent who let them set the price - both times they were listed.  The answer to that question anyway is: "it was the agent's fault - both of them."  I look at the wife because she is setting the tone.  I stroke her a little with the innocuous question: With as lovely as your home is, disregarding any feedback you may have been given [which was obviously disregarded], how can we get your home sold at a price agreeable to you?  This deflects failure from them and they can see I'm trying to help, not antagonize.  Nothing surprises me any more at listing appointments, so I'm ready for her tirade.  It's the fault of the world press.  She and her husband are doing just fine as are all their friends and co-workers.  This whole foreclosure "thing" is nonsense.  I explain I understand she is very frustrated and busy so I will get to the heart of the matter.  What price are they willing to list their home?  Not surprisingly, they want to list at the same price it's always been listed.  I ask if they list at that price, will they be trimming the trees growing up against the house, pressure washing their black, moldy driveway, repairing the mailbox post eaten alive by insects, will they...
 
I'm stopped dead in my tracks.  The wife swears she hears her phone ringing and runs downstairs.  The husband rests his hands in his lap, swallows, and looks down.  I gather my material, make polite chit-chat as I head to the door.  The movie in my head is playing a classic from 1988.  It's the one where I'm attaching a bumper sticker on my fender which reads:  "If you bought in '88, I can't help you."  One of the old guard motivational speakers named Mike is opening up my car door reminding me it's alright to sit in the driver's seat, ...sigh and admonish myself that I've wasted my time, then yell 'NEXT!"

The definition of "property appraisal" from Investor Words: A professional opinion, usually written, of the market value of a property, such as a home, business, or other asset whose market price is not easily determined.  

Suppose Zsa Zsa Gabor comes upon hard times and must sell her diamond ring.  She goes to the jeweler she has used for a century (sorry, Zsa Zsa).  He writes her up an appraisal on his letterhead that he'll stake his reputation that Zsa Zsa's ring is worth one million dollars.  However, surprise of surprises, he won't buy the ring from Ms. Gabor at any price.  Poor old Zsa Zsa needs some money so she slinks off to a pawn broker in Beverly Hills.  After examining the ring, he offers her $400,000.  Zsa Zsa is appalled.  Her jeweler to the Stars of world renown reputation has given her in writing on his official letterhead his professional assurance that her ring is worth one million dollars.  The pawn shop owner will give her $400,000 because that's all it's worth to him.  But, she stammers, you'll be able to shine it up and put it in a nice display box and sell it for much more when the economy comes back and I'll have lost so much.  Not, he says, if you don't sell it to me.  It can remain in your possession, worth one million dollars...or you can sell it to me for $400,000 because that's all it's worth to me.  

It's the same with an appraisal on a house.  Just because a homeowner pays an appraiser for his opinion before listing their home, it has no relation whatsoever to what a buyer will offer or ultimately pay for your property.  Don't use an appraisal in an attempt to hit a buyer over the head with what you've paid your own private appraiser to opine about your property's value.  When an offer is made and accepted on your home in today's market, the purchaser's loan company will call a neutral, third-party appraisal company to independently evaluate your property for the lender - not for the seller or the borrower, but for the entity lending the money on the loan.  If you think that you have an appraisal for $100,000 on a property and the independent appraiser advises the bank that his opinion regarding the value of the home is $95,000 that your appraisal is the controlling appraisal because it is not.  The controlling appraisal is the independent appraisal and even if your personal appraisal is faxed off to the lender in protest, it will go where it belongs - in the trash.  Save yourself the cash.  A market appraisal can be a useful tool when trying to estimate an unusual or multi-million dollar property or an exceptionally unique property and I would recommend it as a guideline, but not the final word.  As we all know, anything is only worth what a buyer is willing to pay and in the case of a home loan, what the lender is willing to lend and under their terms and with an independent opinion.

Everyone wants a foreclosure, whether they can ultimately rent it or rehab it for profit -- or not.
 
Because I get a lot of calls from the curious, I can explain some of the procedures.
 
You'll have to either download from the internet a set of stipulations and/or requirements from a bank and each bank with have similar requirements to follow.  Some may have thirty pages of information that you must comply with, much of it repetitive.
 
The bank will announce that their foreclosures are competitively priced at fair market value or below, based on subject property's condition.  In the event there are multiple offers on one property, you will be notified and will than have specific multiple offer instructions.  You might think they want you to give it your best shot at price, but it can also be that they will then not pay closing costs for example.  In other words, now that there's several people interested in the property because price is excellent, you may have to give up the closing costs you've asked for (if this bank has even allowed you to ask for closing costs).
 
When you submit your offer, you will have no choice whatsoever but to call a designated loan officer and have the offer be accompanied by a pre-qualification letter from said loan officer indicating the type of financing and terms (you want to close in 2 weeks with the bank paying closing costs).  You will be given a name, phone number, and a website to make application.  Can you use your own bank ultimately?  Sometimes and by that I mean if there are two offers that are the same but Offeror A will use the bank's person and you want to use your banker, Offeror A is getting the property.  Don't bother making offers if you need to sell your home first; foreclosures are non-contingent sales.  You won't be able to go to closing in the morning on your house and then close on the foreclosure across town in the afternoon.  I've put my entire house in storage and lived in temporary housing to get a good deal.  While it's a drag with three kids, goldfish, a cat and a dog, if you save $100,000, isn't it worth it?
 
You'll also have to add certain language to the contract to the effect that "Purchaser understands further addenda may follow verbal acceptance."  This means that you've signed twenty pages of addenda, now twenty more pages may or may not follow.  You will also be signing a paper stating that you understand you are using the bank's affiliates to close - loan officer, attorney, title company.  If there is anything in the house such as a washer or dryer and it was intended to be left for the purchaser, it is not warranted to be in working condition, nor will it be replaced with an appliance that is working.  Any disclosures required by the government, such as mold disclosures or lead paint disclosures will be signed and submitted.  Foreclosures are sold in "AS IS" conditions, no disclosures, no warranties, no repairs, nothing.  Can you ask the bank for a repair once you have your inspection?  Everyone wants to ask for repairs despite the fact they were already told not to ask, you will not receive funds or repairs and you may receive your earnest money back.  The exception may be safety or structural defects making the house unsound.  I've had people claim they understand the meaning of "as is," they promise me they would never ask for repairs and as soon as they have an inspection with a laundry list of several repairs, they get overwhelmed and want their money back and want the bank to reimburse them for the inspection.  If this is your personality - don't ever buy a foreclosure.  You're getting the house based upon condition and your offer reflects that. 
 
Earnest money will be in Certified Funds and once the bank signs the contract, the money is deposited.  Most banks will set guidelines of acceptable earnest money up front.  It's generally from $1,000 to $5,000 (more if million dollar property and above) and all cash offers are 10% of listing price, not agreed upon price.  The bank pays commissions based on their net.  A copy of the check is sent along with the contract, bank's loan officer letter, and addenda.
 
Give yourself plenty of time to close.  If you want to close in thirty days, be prepared that the loan officer MUST have all lenders packages to the closing attorney at least three days before closing.  If there is a delay, the buyer pays a daily charge and it will be unpleasant, it won't be a mere $100.00.
 
Once you have received verbal acceptance, you'll have to sign at least one clean purchase agreement, any addenda or counteroffers for blue ink signatures within two or three days of acceptance.  You can then have an inspection if you wish and you will have to pay up to $400 to have the house water lines de-winterized and then re-winterized before and after inspection.  If the utilities are not connected, you will have to call the utility companies to have service put on in your name and also to meet the gas man at the property to light the pilot light.  Utilities will need to be on during the inspection period, and have it arranged with the inspector that once you verify everything is working, then he can come and inspect.  Otherwise, you'll be paying for a trip to the house by the inspector, then a return visit.  If closing is delayed, you will have to pay to have utilities put in your name on what was your original closing date.
 
No bank will allow their agent to forward your contract if even one page is missing initials.
 
Lastly, you will have to pay to have to doors to your foreclosure home re-keyed.  The bank will put on a new set of locks once the former seller has vacated and they will not supply you with any keys at closing and in writing, you will agree to that term as well.
 

Thinking of selling your home in Atlanta?  Face it, now more than ever it takes a lot of planning, knowledge, and nail biting to sell a home in Atlanta.  Price is critical and so is the appearance.  We've actually been blessed this last year in real estate to see some stabilization of prices and homes sales.  Inventory is down, and mortgage rates are low at least for the time being.  Perhaps the free fall is over in falling home values, and then again perhaps it is just the government intervention and an interim pause.  Whatever the case may be, one thing is for sure...not everyone is getting what they want when selling a home! 

Before a home is placed on the market it is wise to make sure all your ducks are in a row!  Let's start with the outside, curb appeal, roof, trim paint, and landscaping!  How does it look to you if you were buying?  There is only one way to sell a home and it is by overcoming objections before the buyer gets a chance to say "No!"  Correct those issues and address them before your home goes on the market!   

On the interior, clean paint, new carpet, new light fixtures, and appliances are pretty much a must!  The price of new homes have come down so much, why would a home buyer want to take on a major project replacing leaky hot water heaters, wall paint with hand prints all over it, soiled carpet, dated wall paper, a home that smells like an old wet pet, the original kitchen appliances and ripped up linoleum?  Let's face it, overwhelming you!  Guess what? Your home will also overwhelmed the buyers.  The same reason you don't want to address all the issues, neither will they!

Before you list your Atlanta home for sale, contact us!  As experienced Atlanta real estate agents, we can help you assess your home for price, appearance, staging and updating!  Why make a costly mistake listing your home with someone that has little or no experience selling a home?  Before you list contact us!  It will be our pleasure to assist you!

Home Sellers Falsely Believe They Know Better!

Fatal Home Seller Mistakes:

1.    Price is firm no matter what information is provided by agent.
2.    Won’t take one cent less than list price
3.    In lieu of addressing objections insist they’ll give the buyer a credit.
4.    On principle they will not pay buyers closing costs.
5.    Seller will not go out of pocket for any loss.
6.    Dispute comps with agents (Example… neighbors gave away their home.)
7.    Believe their home is the best in the neighborhood.
8.    If you wait long enough, the right buyer will appear.
9.    View all offers as an insult, and want to counter back at full price.
10.    Will not counter a reasonable offer.
11.    Blame agent and lack of marketing for the home not selling.
12.    Share with you they are not in a rush to sell and have time!
13.    Falsely believe they don’t have to sell.
14.    Demand the listing agent pay for the seller’s loss.
15.    Unreasonably believe the lack of sale is solely the agents fault.

The most recent sales numbers for Atlanta real estate for December 2009 were just released this weekend from our MLS.  I thought I would share them with you, and in subsequent blogs try to make some sense out of them for a perspective.

DETACHED HOMES

• 3,357 Single family detached Atlanta homes closed in December 2009
• $202,135 was the average sale price for single family detached Atlanta homes in December 2009

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ATTACHED HOMES

• 622 single family attached Atlanta Townhomes / Condos closed in December 2009
• $155,819 was the average sale price for single family attached Atlanta Townhomes / Condos in December 2009.

Agents Must Avoid Becoming Emotionally Involved in the Deal.

I think one of the least talked about things in real estate, yet it’s probably one of the more common occurrences are agents that become emotionally involved in the deal.  In their own zeal to assist the buyer or sellers - the agent starts to act as if the property or equity is their own.  It isn't! If an offer is made on a property that is not full price, all too often the listing agents go postal. On the other hand, buyer’s agents often insult the listing agents and the listed home in a foolish attempt to get the deal on their client’s terms.  My own thoughts are if the home is that bad, why did you write an offer on it?  That is not a good way to negotiate, and actions like these will be perceived as unprofessional and hostile. 

Such transparent behavior is all for naught, and counter productive.  It does no mean the demanding agent will get things their way. Agents that lack negotiation skills often resort to raised voices, and have temper tantrums in a vain attempt to get their way. That painful situation makes others want to remove themselves from the situation ASAP.  However, let's not be naive, these actions are not limited to buyers agents. Listing agents often posture the offer terms are an insult to their principles, and may even go as far as tell you they will not present it.  They may even lie and tell you they have other offers or an offer coming in when they do not.  The later of course may be grounds for regulatory discipline for that agent.  

What agents must not forget is that they are licensed by the state in which they reside to act in a limited capacity on behalf of their principle. They need to more fully understand what the role of an agent of a broker is.  There are limitations in what we are allowed to do, and laws that guide how we are to perform.   Anyone that is licensed needs to fully understand what we can and cannot do with a real estate license.  We need to acknowledge is that the actions of the agent are limited by that licensure, or specific instructions of the sellers to accomplish the task at hand.  A normal real estate license or listing agreement does not confer upon the agent “A Divine right of Kings!”  Our limited role in a deal is basically one of agency - an agent of the seller, a marketer, an advisor, and consultant. 

1. Don't be a control freak!  Just do your own job!
2. Remain factual and know what is occurring in your market.
3. Always be ethical and improve your professional skills, and knowledge.
4. Comply with all real estate laws within the state(s) we are licensed.
5. Always work on behalf of the best interests of our clients.
6. Clear up any ambiguity - ask question and terms.
7. Ensure all items and terms are in writing, and are properly executed.
8. Request further information needed to best advise your own client.
9. Present all offers.
10. Do not posture – thank the other agent for their offer.
11. Never take an offer personally – remain objective.
12. Never become emotional in a deal and lose objectivity.
13. When in doubt seek advice from your principle broker – not other agents.
14. Do not take an inspection report personally.
15. Do not take a bad appraisal personally.
16. Do not practice law – or give advice which is legal in nature unless you are an attorney.
17. Never insult an agent, buyer or seller.
18. Stick to the facts pertinent to the deal at hand.
19. Never make a deal personal.
20. Personal gain -  should never be at the expense of your client. (Double dipping, dual agents, failure to present offers etc...)