Swimming Upstream in a Confluence of Corruption

Vancouver Real Estate: How Big Banks and Big Government can Influence our Local Market.

I rarely dip my toes into the political abyss, but the confluence of Wall Street, Real Estate and Big Government was just too big to pass up in this case. I understand, nearly to the point of apathy, that I can do little to control the outcome of these macro-economic issues. But that doesn’t mean it doesn’t still tick me off to see what’s happening around us.

I’m pretty close to the “action” in this whole short-sale/foreclosure marketplace, working with clients, both buyers and sellers, who are looking for a way out (or way in) to this unprecedented housing situation. Regardless of your political leanings, no matter your disdain for either big government or capitalism run amuck, this is just wrong on so many levels. And, don’t kid yourself, both sides of that equation are to blame.

So without further delay, enjoy the show…

Vancouver Real Estate: Why an Offer Won’t Pay off Your Mortgage

While I “get” the concept of “limited representation” (you know, those flat fee listing options) to help sellers get some MLS exposure and find a buyer, it’s what you do AFTER you find the buyer that really matters.

I tell my selling clients all the time – finding the buyer is actually the easy part (although it has gotten to be a tad more challenging in the past year).  The hard part is keeping the deal on track and getting it to the closing table so a seller can actually maximize that equity.

Just try cashing an “offer” at the bank.

It’s that expertise in managing a deal that truly defines the value in the listing expense.  Sure, marketing costs money, nowadays lots of it.  But marketing (or MLS exposure) alone is not going to get it done.

Why this discourse?

I subscribe to a local real estate “forum” where folks post ideas, comments, deals, etc… I find it amazing that people will turn to anonymous posters – with varied agendas, experiences and perspectives – for advice on how to handle contract negotiations. Earlier this week, an email to the anonymous group was peppered with…

“Is it feasible…”
“Do any of you folks have suggestions for me…”
“I have a plan on counteroffering. Open to your ideas and experiences!”
“Any suggestions would be greatly appreciated!”

Seriously.  These are actual statements.  From a seller who had the house “listed”, but had no/limited “representation”.  And this level of uncertainty is at the offer stage… what happens going through contract negotiation of terms and conditions, disclosure, inspection, underwriting, appraisal, title, escrow, etc…

Look, don’t get me wrong, I don’t fault someone for trying to save money, especially in this economy. But the premise of penny-wise and pound… well, you know the one I’m talking about.

The offer was $70,000 below the asking price.  I’ve talked again and again about whether this List Price was even correct to start with. But regardless, with that type of discrepancy and that level of uncertainty, the money spent of securing solid, experienced representation of a seller’s best interest in a transaction of this magnitude can not be undervalued.

But hey, I’m smart enough to admit I may be a tad bit biased in my viewpoint.

A List Price that Would Make P.T. Barnum Proud…

Finally, RMLS – our local multiple listings service for real estate in Vancouver and Clark County – has caught wind of a tricky tactic that was happening way too often.

Recently, we noticed some real estate listings that simply looked too good to be true.  I mean, I realize short-sales are all the rage, and there have been some screamin’ real estate deals for smart buyers out there.  But the “List Price” on some of these left me scratchin’ my head and searchin’ for my checkbook.  (Right, like I could have done any damage with the latter of the two, but I digress).

First, some school: List Price is defined as a published or advertised retail price of something that can often be discounted by the seller, or a basic published or advertised price, often subject to discount, or even the price at which a product is usually sold to the public.

In all of these definitions, it is an established price, and for the most part, one which a buyer can assume is somewhat negotiable.  Of course, normally – and especially in this market – one would assume the negotiations could generate a reduction from the list price. But there’s the rub. In a questionable marketing ploy, some listings seem to have been priced to simply generate buyer leads.

Sure, there have been real, stupid-cheap real estate deals out there (usually with some big strings attached), but in some cases, listings seem priced simply to pull buyers out of the woodwork, with no true intent to sell at that price.

Well, now according to the MLS for Vancouver, “Listing a property at a lower price than what your seller is willing to accept is a violation of RMLS™ Rules and Regulations (see section 8.5).  Properties listed for less than the seller will accept obviously attract attention because they are literally too good to be true.  Enticing buyers with false information is unethical.” (emphasis mine).

Good. The last thing we need is bait and switch, loss leader tricks in this business. From now on, when you see that house on Craigslist, priced tens of thousands below market value, think twice, and then give me a call or shoot me an email… we’ll get the real story, and you won’t have to worry about being fodder for P.T. Barnum’s historical phrase. (which, by the way, did you know he never actually said…)

Get Out Your Blankets and 10 Other Ways to Cut Energy Bills This Fall

Staying warm doesn’t have to cost a fortune. Here are some ideas from the U.S. Department of Energy for conserving heat and saving money. When the leaves start falling, you know that the heating bills are about to start rising. But keeping your home warm and cozy on chilly autumn nights doesn’t have to break the bank.

The U.S. Department of Energy offers these simple tips and relatively inexpensive home improvements that will help ensure cold gusts stay out and your furnace doesn’t have to work harder than it should. The goal: Conserve energy and keep more of your hard-earned dollars in your pocket.  After all, who doesn’t need to save a little money these days?

1. Plug air leaks with caulking, sealing, or weather stripping. Save 10 percent ($190 per year) or more on energy bills. Focus on windows, doors, outlets or switch plates on exterior walls.

2. Properly maintain the heating system. Heating accounts for half the average family’s energy bill (approximately $950 per year). Make sure the furnace or heat pump receives professional maintenance each year. The small cost (about $75-100 for most service calls) will pay back in better performance all year long.

3. Install a programmable thermostat. Programming the thermostat from 72ºF to 65ºF for eight hours a day while no one is home, or everyone is tucked in bed, will cut the heating bill up to 10 percent ($90 per year), paying for a basic unit in less than a year.

4. Seal and insulate heating ducts. A system can lose up to 60 percent of its warmed air before it reaches the register (wasting $570 in warmed air per year) if ducts are not properly insulated in unheated areas such as attics and crawlspaces.

5. Insulate, insulate, insulate. Adequate insulation in the attic, ceilings, exterior and basement walls, floors, and crawlspaces can save up to 30 percent on home energy bills ($630 per year).  Focus on the attic. (Heat rises.) Most homes should have between R-30 and R-49 insulation in the attic. Learn more at www.eere.energy.gov/consumer.

6. Close fireplace dampers when not in use. When in use, reduce heat loss by opening dampers in the bottom of the firebox (if provided) or open the nearest window about an inch, close doors to the room, and lower thermostat setting to 50-55ºF.

7. Let the sun shine in. Open curtains on south facing windows during the day to allow sunlight to naturally heat the home, and close them at night to reduce the chill from cold windows.

8. Stay out of hot water. Water heating accounts for 15 percent of household energy use. Reduce water heating costs by lowering the water heater’s thermostat setting. Each 10ºF reduction can save between 3-5 percent in energy costs. Also insulate the hot water heater and hot water pipes.

9. Install storm windows over single-pane windows or replace them with Energy Star qualified windows. Storm windows reduce heat loss by 25 to 50 percent, and storm windows with low-e coating that reflect heat back into the room during the winter months save even more energy.  Look for the Energy Star label to maximize savings. Energy Star qualified windows reduce heating and cooling bills by an average of $345, but could be higher in cold and hot climates, compared with uncoated, single-pane windows. Can’t afford new windows just now? Tape clear plastic sheeting to the inside of window frames if drafts, water condensation, or frost are present.

10. Net big savings with a little label. When replacing appliances, light bulbs, electronics, or heating and cooling systems, cut energy bills by up to 30 percent ($600 per year) with Energy Star labeled products. Use compact fluorescent light bulbs (CFLs) in place of comparable incandescent bulbs. Find retailers at www.energystar.gov.

These and other improvements that impact the energy efficiency of a home can save home owners money in the short term and serve as a selling point to potential buyers later. Be sure to save receipts, documentation, and manufacturer’s information.

Not sure where to begin? Try the Department of Energy’s online energy audit tool at http://hes.lbl.gov.  And remember, you can always grab a blanket.

A Redux – Manic Monday’s… and the Desire to Find the Friday Spirit

One of the great things about the adventures associated with trying new things is the learning aspect of it all. I am committed to the conversation that blogging provides, but I am all too aware that there will be bouts of laryngitis along the way.

For example, I don’t think the video I loaded in my last post came through. At least it didn’t in many of the email versions that were delivered. I know it works on the site directly, so please click on through to the site and enjoy.

Maybe it’s Here…