A Buyer's Market: Know Your Foreclosures

Currently, foreclosed properties are on the rise. A complicated foreclosure market can provide ample opportunity for educated buyers, or leave room for devastating financial flops when a property is purchased without a thorough home inspection or sufficient knowledge.

“While some foreclosed homes can be a real steal, make sure to do your homework first,” says Connie Ray, President/Owner of Coldwell Banker Platinum Partners.

When looking at foreclosed properties, buyers should be aware of three different types of foreclosures, and the risks or benefits that come with each.

Real Estate Owned (REO). These homes have been foreclosed and are now owned by the bank. They have often stood vacant for some time and typically have maintenance problems due to neglect, so buyers should be extra cautious.

“REO properties are often sold ‘as is,’ leaving the buyer some wiggle room to request a price reduction based on needed maintenance. If you have the finances, time, and energy for a fixer-upper, REO properties can be a great investment,” Ray notes.

Short-sales. These are pre-foreclosed properties that are typically being sold at a lower price so that the seller doesn’t have to foreclose. Designed to create an ideal situation for all involved parties, short-sales can offer great deals for the seller, buyer and bank.

“If you are looking into a short-sale property, be sure you are pre-approved for a loan,” cautions Ray. “Also, make sure to have a solid home inspection done.”

Auctions. An auctioned home is one of the riskier types of foreclosed property purchases, as he buyer often has a limited window of time to view the property, and no opportunity for a proper home inspection.

“These ‘as-is’ properties can be a great deal for the seasoned real estate investor who knows what to look for. If you’re new to the field, purchasing a foreclosed home at an auction could be devastating financially when major unseen problems arise,” warns Ray.

3 Home-Renovation Projects for Impact and Investment

If you’re like many homeowners, the start of the new year finds you ready to finally tackle those home-improvement projects that have lingered on your wish list. But where do you begin?

First, prioritize those renovations that will have a maximum impact, both in terms of aesthetics and investment values. Also prioritize the projects that will enhance the livability and enjoyment of your home.

Next, decide whether or not it makes sense to handle these projects on your own or call in a professional for help. According to the experts at Sears Home Services, while taking on home remodeling yourself can seem daunting , enlisting the right help can make the process simple and seamless.

Here are three areas of the home to put at the top of your list this year:

The Bathroom
According to the National Association of REALTORS®, one of the best investments in a home is a bathroom renovation. Remodeling a bathroom that's more than 25 years old substantially increases the value of your home. While your bathroom may not need a complete makeover, updating cabinets, lighting, tiling or countertops can go a long way toward improving design and functionality. Or, consider a few quick fixes, such as a new towel bar, shower-curtain rod, robe hooks or showerhead.

The Kitchen
The kitchen is the heart of the home. And kitchen renovations don't need to be dramatic to be impactful—updates such as new countertops, cabinets, appliances or flooring can all dramatically improve the kitchen. These improvements can also help yield increased functionality and space throughout the kitchen. For a simple refresh, homeowners can give their kitchen a new look by replacing the hardware on cabinets, painting or updating fixtures.

The Floors
A great way to upgrade an area of your home and pull a room together is to install new floors. There are myriad options to choose from: carpeting, tile, laminate, porcelain or ceramic tile, vinyl or hardwood. Consult a home-improvement retailer or flooring expert to help make the best choice and to ensure proper installation.

Housing Market to Perk Up in 2012

There appears to be signs of life out there for the housing market.

The up-and-down ride for real estate the past few years was seen again in the fourth quarter of 2011, according to a survey of HouseHunt real estate agents across the country. There are pockets of good news offset by bad, with home values and prices basically bumping along the bottom of the grid on a perceived never-ending rocky road.

But most of the surveyed agents are optimistic moving forward, and the majority say that buyers are out there and activity is up, but pricing remains stagnant, and in some cases inched downward a little more throughout the year.

"I've been just as productive now as I was in the heyday of real estate except that the prices are 50 percent less," said Chris Cochran, a broker-owner from Riverside, Calif. "It's good news for buyers and bad news for sellers because sellers are losing equity by the minute and buyers are able to get a fairly-priced home and a really, really low interest rate."

Cochran said that the inventory in his region of Southern California is crowded with short sales, which fuels a buyer's market mentality. He added that prices were flat during 2010 and the first three quarters of 2011 before edging down late in the year. A breakdown of listings, he said, were 65 percent short sales, 10 percent REOs and the rest investor-owned "flips."

Looking forward, he thinks the housing inventory will increase and prices will again drop slightly before stabilizing in the middle of 2012 with a slight uptick in the final few months.

"The banks that have this so-called ‘shadow inventory' just need to put it on the market and get rid of it," Cochran said when asked how he would get real estate rolling again. "Once we get rid of all that inventory, supply and demand will take over and prices will go back up."

Decreased prices haven't been a big problem recently in the Naples area of Florida, said agent Dawn Amato, whose territory is Marco Island. She said that homes that were previously reduced by around $50,000 are now reduced "by a couple thousand, if that."

"We're not getting near as many reductions as we did in the past," Amato said. "It's been turning around steadily over the past year. The office I just left sold over $200 million in 2011. That's just one office. People feel the bottom of the market is here, so they're buying, and eager to do so."

Amato, who said she's "openly optimistic" about 2012 and beyond, said a tight inventory of available houses is the main problem in her area. That scenario leads to faster sales and even prompted some 'price wars' the final two months of 2011.

"If it's on the water with a view and it's priced right, it could be sold in days," Amato said. "Same scenario, but priced too high, maybe a few weeks."

Overall, 22 percent of HouseHunt agents said the average time for houses on the market was 60 days or less, down from 26 percent in the previous quarter. Regarding inventory, figures were identical in the third and fourth quarters, with 68 percent saying supply was good and 32 percent reporting a tight market. The only significant difference from the third quarter to the fourth was 42 percent saying they were getting at least 95 percent of a listing's asking price, compared to 51 percent previously.

On the Boise outskirts of Meridian, Idaho, agent Jeff Stewart said inventory and foreclosures have been declining for a number of quarters, with short sales diminishing toward the end of 2011. Prices are basically stable, he said, and the average time houses are staying on the market has decreased "from eight to nine months of inventory" to a little less than three months.

"The market is actually better of late," Stewart said. "We actually have a shortage of good properties. I think people are confident that we’ve hit bottom. In fact, in some of the areas I cover, prices are ticking up a bit, and I think it bodes well for a slow curve of stabilization."

An upward trend also was reported by agent Kevin Bergin, who works in the Long Beach Island, N.J., shore area. Bergin said levels in his office for the year were back to 2008 levels, with 60 percent of house visits turning into sales.

"I think buyers generally feel better about the economy, the low interest rates and prices being down 15-20 percent," he said. "People are still very discouraged about the government on both sides of the aisle, but they feel that now is a good time to buy a second home."

Of Bergin’s clients, 10 percent were first-time buyers and 25 percent were buying a primary residence. The assessed value vs. the asking price remains an issue, he said, but "most of the people looking now aren’t the same tire-kickers as there were two years ago when they were just asking for ridiculous prices."

Overall, prices in his area are down 7 percent from 2010, Bergin said, but he’s optimistic about 2012.

"If the current trends and the way people are thinking continue and interest rates stay low, which they probably will, it’s going to be a pretty good year," Bergin said.

Optimism also is what Wanda Hardee is clinging to as the new year begins. The agent who works in the Anderson, S.C., area said she had two "big closings" in December to ring out 2011 on a high note. But while she said that "things are picking up here," Hardee added that it’s hard to get sellers to price their homes correctly because of increased competition from foreclosed properties.

"Foreclosures are still pretty prevalent here and we’re starting to see more and more in the higher-priced end," Hardee said, adding that another obstacle to home sales has been the difficulty of some people being able to secure financing.

Still, she said she loves the business and only knows one way to tackle it.

"We’re going gung ho," Hardee said. "With real estate, just like anything else, you have to have a positive attitude. We’re going to make it work."

Additional results from HouseHunt’s fourth quarter survey include:
• Sixty-five percent reported that they were getting multiple offers, the same figure as the previous quarter.
• Twenty-nine percent said customers were first-time buyers, up slightly from 27 percent in the previous quarter.
• Fifty-one percent reported a negative price appreciation, compared to 58 percent in the third quarter and 64 percent in the second.

For more information, visit www.househunt.com.

How-To: Finance Your Renovations

If you recently purchased a fixer-upper, or are planning on making big renovations to your existing home, you may be wondering what your finance options are. Below, Connie Ray, President/Owner of Coldwell Banker Platinum Partners takes us through some of the best options for financing renovations.

According to the Millennial Housing Commission, few lenders are willing to administer home improvement loans. Most prefer to make home equity loans or unsecured consumer loans, as they are easier to manage. “Home improvement loans usually require inspections and irregular draws on the loan amount as work is completed, which requires regional or national lenders to find local partners to provide oversight,” explained Ray.

Financing repairs and improvements with home equity is okay for most homeowners, but it is difficult for many first-time buyers. “This is because they have lower-incomes, smaller savings, and have made lower down payments on their homes than first-time buyers a decade ago. So they have little equity to borrow against,” Ray explained. Unfortunately, it is often lower-cost older homes purchased by first-time buyers that need the most work.

One option is refinancing your existing mortgage and taking out cash.
“With a refinance, you pay off an old loan on your home and take out a new one, usually at a lower mortgage interest rate,” said Ray. “To refinance, you will generally need to have equity in your home, a good credit rating, and steady income. You can borrow a percentage of the equity to cover things like remodeling costs, debt consolidate, and even college tuition.”

Don’t forget, however, that when you refinance, you will incur all the closing costs that go along with getting a new mortgage. “Unless you're doing extensive renovations and can get a mortgage interest rate at least two points below your current loan rate, you may want to select another financing option to pay for your renovations,” Ray suggested.

Another refinancing option is getting a second mortgage. “This is a loan against the equity in your home,” Ray explained. Financial institutions will generally let you borrow up to 80 percent of the appraised value of your home, minus the balance on your original mortgage, of course. And similar to refinancing your existing mortgage, you may incur all the fees normally associated with a mortgage. These fees include closing costs, title insurance and processing fees.

“If you aren’t interested in either of those options, you can contact the government about home improvement programs,” noted Ray. “And you can always borrow from a finance agency, but I suggest making that your last resort. They generally charge high rates.”

Moving and Money - 5 Ways to Cut Costs

Money and Moving: 5 Ways to Cut Costs

SAVANNAH, GA, Jan 12, 2012—Between closing costs and property taxes, buying, selling and owning a home is an expensive ordeal. But moving doesn’t have to be. Below, Connie Ray, President/Owner of Coldwell Banker Platinum Partners offers five ways to save money when making a move.

1. Time it right. “Most people move in the summer, because the kids are out of school, the weather is ideal for packing and, in general, most people are less stressed out,” says Ray. “This means movers often charge less during the off season.” If it’s at all possible to postpone your move, attempt to relocate between October and April to score those off-peak discounts.

2. Look into delivery. “There are a handful of companies, like PODS and 1-800-PACK-RAT, that will deliver a portable storage unit to your place,” Ray suggests. “You will save money by packing it yourself, and then the company will come back to pick up the unit and bring it to your new place.”

3. Use what you have. When it comes to packing supplies, you can save money by using what you have. “Pack in suitcases, bags and bins you already own before buying supplies. And if you do need more, try purchasing your packing material from a recycled box company or ask local businesses for old boxes they plan on tossing,” Ray explains. Moving companies often over-charge on packing supplies, so use them as a last resort.”

4. Rent your own truck. While it requires more work, renting a truck and doing the move yourself from start to finish is the cheapest way to move. Ask friends and family to help, or hire neighborhood teens to help with the packing and lifting. “Be sure to look into all the fine print before choosing a rental company,” Ray warns. “Fuel and mileage charges can differ immensely, so do your research.”

5. Don’t forget to deduct. “Many people don’t realize they can deduct moving expenses from their taxes,” Ray says. If you relocated for work, you may be eligible to deduct packing, transporting and storing costs from next year’s taxes, so be sure to save your receipts!

For more information on low-cost moving, please contact Coldwell Banker Platinum Partners at Connie.F.Ray@mycbpp.com, 912-352-1222, or Coldwell Banker Platinum Partners.

Are You Paying Too Much for Homeowners Insurance? Keep More Money In Your Wallet with the Following Tips

By Keith Loria


In today’s tough economic climate, homeowners across the board are doing everything they can to save a few dollars here and there. If you’re in the process of cutting back, one area where you may be able to save money when it comes to your home is your homeowners insurance.

Data over the last five years reveals that homeowners insurance coverage has increased significantly, but the good news is that there are things you can do to lower the cost.

The easiest solution is to bundle your insurance. Many insurance companies offer discounts if you package multiple policies such as your car, boat and home insurance, so be sure to shop around and see where you can get the best deal. On average, you can save 5 to 15 percent if you purchase two or more premiums.

While most people look for insurance policies with small deductibles, in the long run, taking on more of the financial burden if something should happen to your house is a great way to save money. By raising your deductible, your monthly costs can decrease 5 to 10 percent.

Safety also helps with savings. Something as simple as installing carbon monoxide detectors, smoke detectors and alarm systems can reduce your monthly bill. It’s a good idea to ask your insurance agent what steps you can take to make your home more resistant to natural disasters as well. You may be able to save money on your premiums by adding storm shutters, reinforcing your roof or even buying stronger roofing materials. Older homes can even be retrofitted to make them better able to withstand earthquakes.

Just as you would do with a car or any other big-ticket item, taking the time to shop around is always smart. Be sure to check consumer guides, companies and online insurance quote services, which will give you an idea of price ranges and tell you which companies have the lowest prices. Keep in mind that you must obtain insurance in order to close your sale, so make sure you have compared different companies and found the best deal ahead of time so that you don’t get stuck with an expensive policy.

Also, it’s not necessary to insure a house for the amount that it was purchased for. Even if your house were to completely burn down, you would still have the land, so take this into consideration when deciding the total amount you need to insure for. A good insurance agent will be able to help you calculate the proper replacement cost of the house.

In addition to these tips, it’s wise to talk with your broker and see if they have any thoughts on how to lower the cost of your homeowners insurance policy. It’s also important to review your policy each year to ensure it still accurately covers your home.

For more information about homeowners insurance, contact our office today.

A Fresh Assessment: Determining Property Value Can Save Money Come Tax Time

By Keith Loria


The expenses associated with owning and maintaining a home can be a shock to new homeowners, however, a current estimate of what your new home is worth can often times work in your favor when it comes to lowering your property taxes. If you recently purchased a home, it’s a good bet that you may have bought the house for a price lower than the property value, so sometimes taxes can be lowered if the value has changed.

“A tax assessment is an estimate on the value of your property solely for the purpose of determining how much you owe in property taxes,” said Peter Hoegen, an attorney with Hoegen & Associates, PC in Pennsylvania who specializes in tax assessments.

Lowering property taxes isn’t the only reason that homeowners go through the reassessment process. Another reason for a reassessment is for insurance purposes, to make sure the home has an appropriate level of coverage. Additionally, homeowners may opt for a reassessment due to changes in value that have been caused by the downturn in the economy.

For those who may be thinking of selling, an assessment is a good way to learn if the house is worth more than what is owed, and can provide valuable data for homeowners who are looking to get a lower mortgage rate.

“If you are thinking of having your home assessed for a possible readjusting of the value, it’s important to understand the protocol and timelines that your city or state has, because all are different,” Hoegen said.

The first step is to begin with the county assessor’s office. In 2012, the process has become much simpler for some, as more places are allowing homeowners to appeal tax assessments online. If that’s not an option where you live, plan a visit to your local assessor’s office to register for an appeal.

The appeal process is most commonly conducted by someone coming out and inspecting the property and comparing it to neighboring houses. Some will rely on computer models, but that could be problematic because you’re not seeing everything that can be viewed with the naked eye.

Although the appeal process itself can be relatively quick, if it’s clear that a change needs to be made, actually having someone come out to your property to perform the assessment can take anywhere from a month to a year, depending on the amount of people following suit. In today’s housing market, with property values decreasing in many areas, more people are turning to reassessments to lower their taxes.

When making your case, be sure to have documents ready that show what homes in the neighborhood have sold for. Prices of comparable homes that have sold in the past six to 12 months will be most helpful to build your case. Much of this data can be found on the Internet, but the real estate agent who helped you buy your home can assist in gathering the information as well.

Remember, assessed value is often not equal to market value. Many times, an assessment is only a percentage of what the home could actually be sold for, so appealing the value of your home might not be as financially advantageous as you think. The last thing you want is for your taxes to rise because the house is now worth more.

For more information about property reassessment, please contact our office today.