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Jeff & Laurie Asquith

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Yesterday is Yesterday!

by Jeff & Laurie Asquith

4 to 5 years ago I had the unenviable task of telling sellers that their $400,000 home (based on 2006 prices) was then worth $300,000.  I often heard "I understand that my home went down in value but it can't be that much!  I'm not giving it away!"

I had to explaining to them that selling their home at its current value isn't giving it away, it's selling it for its current value.  Yesterday is yesterday... we have to live with today.

Now values are going back up (some areas more then others).  Not to where they were in 2006 yet but they are going up steadily.  Again I have the unenviable task (this time with buyers) of telling them that they can't buy at the bottom.  The bottom was yesterday (actually a few years ago).

Buyers in the future will likely realize that values are going to continue to climb for a while and interest are certainly going to rise.  Waiting will put me in that position again where I will have to explain to them about the good days of 2015, when prices and interest rates were lower.  Yesterday is yesterday... we have to live with today.

Just a little insight from a 38 year veteran of this business.

2015: The Market in Review

by Jeff Asquith

2013 was a good solid year for the real estate rebound.  The bad side was that we had a shortage of listings.  The good side was that we finally saw prices increasing, removing part of the 35% average drop that we saw in Chicagoland.

2014 started off slowly after the hard winter and then rebounded to become more like 2013 through mid year.  From mid year on, things slowed down.  It wasn't bad, it just didn't live up to 2013 standards.  Prices started to soften a little.

2015 shows great promise.  Interest rates are down again (under 4%) and inventories are low.  People seem to have come to the reality that these rates are not here to stay.  I always share with our clients that my parents bought their first house in 1950 (before I was born!) with a 5.5% mortgage.  These rates cannot last at these levels!

The other good news is that lenders are softening their guidelines a bit.  During the recession regulations got tighter and tighter.  Now finally, there is some relief.  FHA just reduced their private mortgage insurance by .5% reducing payments significantly.  FNMA has now made 3% down conventional loans available to well qualified buyers.

I do expect prices to move up this year.  I'm estimating 3-5%.  Sales will, within my expectations, be at the highest level in the past 7 years.  We have a long way to go to recapture peak values, however every step helps.

Don't settle, but know the facts!

by Jeff Asquith

Inventory of homes for sale is very low.  Prices are on the rise.  Interest rates are on the rise.  Prices are still much lower then 7 years ago.  Those are the facts, so how do we use them to your advantage?

If you are actively looking for a home and you can't quite find everything you are looking for, what will be the result of the facts above?  Your perfect home is getting further and further away.  Don't settle, but realize that if you don't act, your dream home is running away from you.

If you are waiting for something, don't.  Read the facts above and realize that now is the perfect time. 

Call us and let us help you review your personal needs.  847-363-5993  Our services are always free to buyers!

-Jeff & Laurie

What does 2014 look like for the housing market?

by Jeff Asquith

2013 was a turn around year!  Laurie and I enjoyed a record year thanks to the many personal referrals and loyalty from our past clients.

Housing values in the Chicagoland area went up about an average of about 10% in 2013 after an average drop of about 35% in 2007 - 2011.  Each market within our area has to be assessed individually by an expert (hint, hint).  Some markets went up 15-20% last year while others are still waiting their turn.

As mortgage regulations get tighter on January 1, 2014 and interest rates start to rise (as they inevitably will) you might believe that things will slow again.  Truth is if the rates rise too fast, they will.  However, the number one factor affecting value right now is lack of inventory.  That should continue.  I predict another year with about a 10% increases (on average).  I also believe that the slower market segments to react will start their way to similar increases too.

Take advantage of the rates and ask us to watch the inventory every hour of every day for your perfect home!

New Construction Comeback?

by Jeff Asquith

As the market makes a comeback, new construction is starting to show up again.  Here's some things you should consider if new construction becomes a consideration for you.

First, don't go into a new home or development without us!  No reputable builder will charge you more to have us represent you.  You pay the same.  But in order for us to be there for you, they insist that we bring you in the first time and register you as our client.

Second, with the market having gone down in value significantly, there are lots of great values out there!  The issue with new construction is that it's price is based on cost and profit.  Costs actually have gone up while home values had gone down.  So how does a builder compete with homes that have gone down 25-35%?  They can't.

However, new construction is fun.  Who doesn't like to pick out everything when you buy a house?  If that is the choice you make we will support it and represent your interests to the fullest.  We just want you to know that the day after you close on your new home, it is a "resale" and you've got a way to go before you make back the extra money that you paid.

Finally...Some Good News For Sellers!

by Jeff Asquith

Property values are on the rise and there is a shortage of good homes for sale.  It all adds up to the market moving more and more to the seller's side...with a few caveats:

  • After an average drop of 35%, a rebound of about 10% is welcome! But, it doesn't include all segments of the market or every area equally.
  • The appraisal process for lenders has changed drastically and even if your property sells for more, it may not close at that price.  This is where having a great Realtor is more important then ever to get you through the processes.
  • There is a fine line between getting the very best value out of the market and becoming old news.  An accurate evaluation of value is essential.

If you are selling and buying you can't have last years prices on your "buy" and this years prices on your "sell."  What you can have are extraordinary interest rates (although they are creeping up).

Buyer or seller, my message here is simple:  You need a great Realtor to guide you through!  We'll give you two!

 

 

 

 

The upside and the downside of buying a short sale

by Jeff & Laurie Asquith

The upside and the downside of buying a short sale

Upside

a)      Very little – The amount saved can be offset very quickly by repairs and extra costs

Downside

a)      The contract is negotiated with the seller, but seller does not have the final say

b)      The bank appraises the property for more then what you and the seller agreed on and will only close if you come up with the difference.  We’ve seen banks come back wanting as much as 25% more then what was agreed to with the seller

c)      The process can take many months (have seen as long as 14 months) only to reject your contract for dozens of reasons leaving you to start over from scratch.  Guidelines now call for them to respond within 60 days, but they do not.

d)     The contract must be approved by the lender.  Here’s reasons why they often won’t approve the contract:

1)      They don’t feel seller’s financial situation warrants it

2)      They don’t feel that the seller is being forthright

3)      They don’t feel that the seller is cooperative

4)      They don’t agree with the amount that the second lender (there often is one) wants in order for them to agree to sign off.  This is now supposedly capped at $6000 but the second mortgage holder can refuse to allow the property to close if they are not satisfied with their payout

5)      The bank expects you to pay several expenses typical paid by the seller, raising your overall cost.  Even after that, they can decide at the last minute that they will not pay some of their other expenses

6)      They want the seller to come up with money that they don’t have

e)      The contract is strictly “as-is” and you’re charged with all cost of all repairs, no matter how expensive

f)       Sellers often take things that should stay with the house according to the contract.  The bank will not be responsible for this.

How to fix a dripping Moen faucet for free!

by Jeff Asquith

Most homes in the Chicago area have a Moen faucet somewhere (or everywhere).  The single plastic knob handle with the teardrop shaped insert are common builder favorites (and the most common).  They last forever and they are relatively inexpensive.  They usually only meet their demise when they are replaced by something more modern.  

When it comes to fixing a drippy old Moen faucet here's the secret.  The cartridge (the part that needs replacement) is guaranteed for life.  You can fix it easily (I did it!) and the part is free!

When a Moen faucet drips or keeps running after you have shut it off, here's a You Tube that someone posted (I don't know who they are) on how to replace the cartridge.

http://www.youtube.com/watch?v=abSpgmaNXD0

Make sure when you go to the hardware store (I went to Home Depot) that you bring the old cartridge with you.  As long as the replacement part is Moen brand, the replacement should be free!  If you have any issues contact Moen customer service: 800-289-6636.

 

Some of the best reviews that we've enjoyed from past clients have referred to us as part of their “dream team.”  The rest of the “dream team” in their eyes are the Lender(s), Inspector(s) and Attorney(s) and others that we recommend.  The professionals that we recommend aren't actually part of our team, but they are people/companies that have taken great care of our clients.

As part of our commitment to you, Laurie and I NEVER take any compensation from the people that we recommend.  We make recommendations for one reason only.  To help you have a better experience!  Great people working on your behalf protect your interests better, do a more complete job at a fair price and prove to us over and over again that the end result is a smoother transaction for our client!

Of course, the final decision is yours.  We just want everything to be as perfect as possible for you.  A bad choice can have devastating results.  Selfishly, good choices do mean more great reviews for us!!

New Year, New Challenges!

by Jeff Asquith

Happy New Year!

It's great to see that the market is coming back.  Here's the good news:

>The bottom is behind us.
>Prices are fabulous for buyers.
>Interest rates are still at historic lows.

Here's the bad news:

>We have a shortage of good homes for sale.
>The appraisal process will keep values from returning too quickly.

Let me explain that last one ("The appraisal process will keep values from returning too quickly").  When the market tumbled 6-7 years ago someone decided that appraisers had too much flexibility to appraise properties too high (and that was partially responsible for the over-valuing that lead to the bust).  Truth is, appraisal is subjective.  Always has been, always will be.  I've recently seen two appraisers appraise the same house for two different lenders and one came in at $260,000 while the other came in at $326,000.  

The resolve to what they perceived as an appraisal problem was to pull names out of a hat, taking away any "choice" of appraiser by the lender.  Now the problem is we sometimes see appraisers from 50-100 miles away who know nothing of the area.  The example above with the appraisal at $260,000 pulled comparable sales from a much lower priced adjacent neighborhood that he believed was the same neighborhood.

Add to all of this mess that the lenders are scared to be holding mortgages through another decline (even though it's highly unlikely).  So....they want the appraisers to be "conservative."

Add to that: The comparable sales from 3-6 months ago sold for less then they can sell for today (yes there is a rebound in some of our markets).  The lenders will not allow the appraisers to "adjust up" for the improving market (even though they "adjusted down" for the declining market).

Add it all up and you have slowly rising prices even though supply and demand would dictate moderately rising prices.  If you are a homeowner waiting for your value to return, it doesn't quite seem fair.

 


 

Displaying blog entries 1-10 of 13

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Photo of Jeff & Laurie Asquith Real Estate
Jeff & Laurie Asquith
Coldwell Banker
20 South Roselle Rd.
Schaumburg IL 60193
Jeff: (847) 363-5993
Laurie: (847) 209-9290
Fax: 781-609-9426