Why would this be interesting news? Realtors (and actually buyers and sellers) care about the “housing stock” – how much is out there for sale and in the last years, what percentage of the houses for sale are foreclosures and/or short sales? This is important because as we all expect and know, the pirices for foreclosed homes are lower and IF there is a predominace of those types of homes in a neighbhorhood, over time, the overall market value of each home sold will go down. As the inventory of foreclosed homes gets reduced, then perhaps market values of the homes that are privately owned will go UP as they get sold.

Part of the process to make this all happen is the APPRAISAL process. Appraisers are always under pressure to provide an accurate and valid assessment of market value for each sales transaction and when the housing market was in a free fall, many areas had “declining values” as appraisers termed it so when a house DID “want” to be sold for more than the comparatives showed, it was a dififcult position for the appraiser to take to give it MORE value than the current market was showing. When housing prices were going up and up and up, it was “easy” for them to do this but not when housing prices were dipping at a CONTINUAL rate.

And remember, all appraisal valuations happen at a LOCAL level – as local as it can possibly get…

So I THINK this is good news for all of us… I will keep you posted as more articles come across my desk. If you wish to read more of the article, here is the link, courtesy of INSIDE REAL ESTATE NEWS..   I suspect you will need to “cut/paste” this link into your browser to get to the article. Happy Reading!

http://welcometoulc.com/mfw_pb/t/27150b/door.mfw_pb.php?go=http://insiderealestatenews.com/2011/11/foreclosure-sales-down-28/

Have a good day!

Unless you live in the tropics or in the south, the COLD WEATHER IS COMING.

As a reminder, UNHOOK ALL HOSES and ANY OTHER DEVICES that are attached to outside faucets IMMEDIATELY and I mean NOW… because here in Colorado, is is Monday October 17th and the weather forecasters are telling us we should have our first hard freeze tonight.

I know this is a bit of a late notice, but tenants are responsible, like home owners, for thinking about maintenance of their property at all times. We have already contacted various sprinkler companyies to get in touch with tenants to get into the house, turn off the outside water and to blow out the sprinkler system..

Take this opportunity to check out the furnace filter… AND check the batteries in any smoke and carbon monoxide detectors in your property. It only takes ONE issue to cause terrible trouble, damage or death to your family.

Be sure your pets are properly taken care of – make sure the water in their bowls doesn’t freeze, and that they have adequate shelter to stay out of rain and snow (I am guilty of this – I saw all 4 of my doggies huddled under a small roof overhang this morning while they were getting drenched… poor little bugs).

Of course there are all kinds of things to prep your car for the winter…

Lastly, make sure YOU are prepared… maybe have a blanket and snow shovel and ice scraper in your car and maybe some cash tucked somewhere for food, gas, help, etc!

Enough “mothering” of everyone… enjoy the gorgeous fall colors if you get them where you live!

Just in the last week I have had the opportunity to meet with TWO home owners who are faced with this question. Unfortunately, both owners are WOMEN in the 60s who have JUST been “discriminated against” and lost their jobs to a MUCH younger and therefore much less expensive human resource. And these aren’t untrained, untested women – they are at the top of their field…

So now they are unemployed in a world where anyone over 50 is considered ancient.. OH THAT HURTS ’cause I fit into that category. And I will get off of my soapbox but this is a disturing and unfortunate trend ..

I was asked to come and talk with them to help them think about either selling their home or renting it out. In one case, a good friend and associate of mine is the realtor who would sell it IF the owner chooses that path but she had the presence of mind to suggest to the owner that she speak with me about renting the house so she has the full range of information on which she can base a hopefully good decision…

There are obviously pros and cons to each decision. IF the homeowner is “upside down” or does not have much equity in the property, then selling might not be a viable option. If the property sells for less than they paid AND they have to bring $$ to the table to close, this might not work. What if they don’t HAVE the $$ to bring to the closing table? Maybe they have no equity in the property at all so if the property sells for less than what they paid for it, the $$ they have to bring to the table might be in the $10′s of thousands.

When you sell, you generally need to make “delayed repairs” or bring ammenities in your home “up to date”. Sometimes hardwood floors need to be sanded and refinished, painting and carpeting and clean up are very typical. Perhaps the owner may include a Home Warranty for the new buyer so if something breaks in the first year, the buyer is “protected”.

When you rent out a property, some of the issues that you need to address if you are selling are the same! However, there are some things that you do not need to “worry about ” as much if you are renting vs. selling. Let me give you an example – I was asked to consider renting out a nice condo in Lakewood. It is in a fantastic location, it has a partially finished basment so it has good square footage, a 2-car attached garage and a smaller kitchen with an ORANGE countertop! If he was going to sell it, the realtor strongly suggested that he replace it but when I looked at it as a rental, I suggested he just leave it alone. Not that tenants don’t have discriminating tastes – their timeframe is “shorter” and they know they can live with an orange countertop for a year or so. It turned out to be the right decision. We rented it very quickly to a wonderful set of tenants and all is fine thus far!

You also need to consider the appliances in the property. When you are selling, the refrigerator and washer/dryer are less critical to the buying decision. When you are renting out a property – I VERY STRONGLY suggest that you DO have a refrigerator in the property. It doesn’t need to be “high-end” – it just needs to be CLEAN and operating well. AN ice-maker, stainless steel, etc. are “nice to haves” but not critical. Leaving your washer/dryer is also “nice to have” but there are tenants who buy a washer/dryer and wish to bring it with them.

Then there is the issue of the amount of rent we can get for your property. This is a complex combination of TIMING IN THE YEAR, location, condition, size, amenities, etc. Rentals are stronger in recent years than when the recession first hit but it is STILL a competitive market and prospective tenants make careful choices these days as it is costly to keep moving not to mention a pain in the “you-know-where” to MOVE.

Our goal is ALWAYS to make money for the owner but in rentals, a more realistic expectation is to COVER YOUR COSTS. So we want the rental amount to cover the owner’s mortgage, HOA fees and the property management fees. If we can’t quite cover that total amount, getting as close as possible is what I hope to achieve for the owners. There are taxes implications of the “loss” that might have each month – talk to your tax expert for further insight into this aspect of renting your home.

So you can see from this brief discussion that there really are NO hard and fast rules on when you should sell vs. rent. Each situation is different. Each property and the goals/needs of the owner vary… that is what I find so interesting about this business.

Every real estate or property management sale or purchase or rental looks like a PUZZLE to me. I like to look at all of the pieces and see what fits together best.

If you need assistance in solving YOUR PUZZLE in the near future, please don’t hesitate to contact me!

NOW a few more reminders – are you MOWING THE LAWN? Are you WEEDING? Are you WATERING? These are not frivilous questions – if you own a home, this is a VERY important contributing factor to the value of your asset. FIRST impressions are critical as we all know. A house could be fabulous inside but if the yard is all dried up or full of weeds, the potential buyer may just keep driving. And if you live in a condo/townhome and the HOA isn’t keeping up the property, THAT will also impact the value of the property.

So TENANTS OUT THERE – if you are renting a house from me on behalf of the owners I work for, YOU MUST do that yardwork that I mentioned above! We cannot drive by all of our properties every week to make sure the lawn is being mown, watered and weeds are being pulled. Consider it a “meditative” exercise where you can commune with nature… ah.. feel it? But seriously, the LAWN is a part of the property that has value that must be maintained.

Back to figuring out how much a property is worth. So how are you going to determine that $$ amount? Are you going to ask your neighbor? Just use what the guy down the street sold his house for? Will use you the various websites out there, like Zillow?

Let me suggest that VALUING a property is a complex and technical exercise that should really only be done by people who know what they are doing… that is what APPRAISERS are for. I am a licensed appraiser but since I haven’t been a practicing appraiser for a number of years, even MY valuation isn’t going to be perfect. A good realtor should be able to compare your house to that which has sold IN THE LAST 6 MONTHS… and ONLY that timeframe. Anything beyond 6 months invalidates the analysis.

There IS a “structure” that is used by appraisers… They look at:

1. Location – your NEIGHBORHOOD if possible. NOT one that is miles away, across town or not “like” properties – so you cannot compare your house to a townhome.
2. Age of the property
3. Style of home – this is the single thing that most realtor mess up. A two-story is NOT THE SAME as a ranch-style home. I lost a deal over this so it is REAL.
3. Size – in terms of lot size, bedrooms, baths, sq. ft,- total and finished.
4. Condition- this is quite subjective but if the house is “updated” the condition will generally considered to be “better”.
5. External conditions – does your property back up to a busy road or have a commerical building next to it? Does it have VIEWS?

Just a few “rules” to remember. You can ONLY call a room a bedroom when it has a closet in it. LOTS of people break this rule to try to “stretch” the bed count in a house. An appraiser won’t make this mistake.

If you live in an older home, the bedrooms in the basement will probably be considered NON-CONFORMING. That just means that they don’t conform to CURRENT buidling codes that require a legal “egress” window that is large enough for a normal human being to crawl out through PLUS one of those bedrooms must have a ladder to climb up the window well. If your house is the ONLY property that HAS non-conforming bedrooms (unlikley in older communities) then THIS would affect your market value.

Think about another “rule” that says you don’t want to have the most expensive house in the neighborhood because your value will be “brought down” but the lower cost properties. A corollary is the folllowing – don’t OVERIMPROVE your home. So if your home is at the lower end of the market values where you live, you want to think about NOT installing lovely new granite countertops and high-end stainless appliances and hardwood floors and putting an addition on the house. The reason being – you will NOT GET YOUR MONEY BACK.

You actuallly never DO get all of your money back but the return on your investment will be very low. If the neighborhood cannot “support” that expensive of a finish on a home, then you are wasting your money. Spend more wisely by making sure the house is nicely painted inside and out, the roof/gutter/soffits are in good shape. Work on the yard/fencing, etc. as suggested above. Replace outdated cabinetry, faucets, lighting, etc. Those types of upgrades are much less expensive and will make the difference in the value of your property.

A cardinal rule that lots of people break when “comparing” homes is calculating PRICE PER SQUARE FOOT. This is simply a NO-NO when comparing one property against another. WHY? Because it assumes FIRST that ALL square feet in the house are of the SAME age/ condition/quality. SECONDLY, when comparing against a DIFFERENT PROPERTY, it assumes that YOUR square footage is the same in age, condition/quality as THAT ONE.

So if you compare two houses – one with the original 1972 kitchen with fixtures, flooring, cabinetry and appliances with one that has been updated with newer appliances, cabinets, countertops, fixtures, etc. you are making a big mistake. Comparing square footage with old green-shag carpet against that with newer hardwood floors doesn’t make sense either! And remember – square footage applies to LIVING SPACE (finished or not) – so PORCHES, DECKS, PATIOS, GARAGES do NOT COUNT in square footage. The appraiser WILL consider the difference in value between a carport, one-two-three car garages (or none) but NOT as part of the square foortage analysis that is done.

So those are my “hints” for success in determining what your property might be worth. And remember – if you had an appraisal done 5 years ago, 5 weeks ago or 5 minutes ago, it is ALREADY inaccurate because another property might have closed in those last 5 minutes that could have affected the market valuation of your home.

Consult your favorite realtor or appraiser to help you out with this. Those online websites will not be accurate at all for many reasons…

Good luck! And remember, if your property isn’t worth what you want/need, etc., then consider renting it for an appropriate period of time. We are busy helping lots of owners do that very thing until the market can “recover”…

Noone complained to me that my blog wasn’t being udpated… so that should tell me something. But I DO want to continue blogging and keeping anyone out there who might read this up to date on important issues and interesting information relating to Real Estate and Property Managment.

I started 2011 with 40 rental properties to manage and by July 1st I was up to 60! That is a phenomenal 50% growth in the first 6 months of this year. I continue to have wonderful owners to help and great tenants to help put a roof over their heads…

So that is the good news … but I didn’t manage to keep with important things like blogging, like keeping in touch with family and friends, like relaxing.

So I THINK I am on the path to dealing with those issues. I have a new associate who is at the moment in Real Estate school! Once she graduates (of which I have no doubt) she will be helping me with BOTH real estate sales and property management.

So I am BACk and I will work at keeping more up to date! Have a good weekend…

Did anyone see the show that the Biography Channel put out on the top 100 people who most influenced our civilizations on the last millenium? I know it is now 10 years old but the results are still relevant.

Can you think of the people were in their top 10 list? Probably scientists like Edison, Einstein, Coperinicus, Galileo…

Probably some other important people like Martin Luther, William Shakespeare (I just read a great book about him about how much we do NOT know by Bill Bryson – I highly recommend it), Karl Marx (wow I thought that was interesting that he is in the top 10)…

And guess where the upcoming holiday honoree fell?  He was number SIX on the list

But my question to you is (and without looking it up), WHO WAS NUMBER 1 ON THE BIOGRAPHY LIST FOR THE MILLENIUM? AND WHY?

Now, there are members of my Connect Group (a wonderful ladies group who meets every Wednesday in Wheat Ridge – contact me if you want more information)… to whom I TOLD the answer to this question!  So if you were at a recent meeting, you will get extra credit if you actually REMEMBER what I told you.

But let me know what you think.  You might be quite surprised by Biography’s choice.  And if you want to throw some names out to me, I will tell you where they fell on the list (IF they made the list). Surprisingly, FEW political leaders were included on the list, other than people like Adolph Hitler, Gandhi (Numbers 16 and 17).

And then you have to think about why ANYONE was included on the list.  They had to have done something that AFFECTED the world as we know it.  Certainly the people I have already mentioned you all know of and probably can think of WHY they were included… the few I was not familiar with were Dante Alighieri, Mary Wollstonecraft, Edward Jenner, and Patient Zero.  

- Dante Alighieri is THE DANTE, Italian poet who wrote THE INFERNO- I didn’t recognize his last name…

- Mary Wollstonecraft was an 18th century British writer, philisopher and advocate of women’s rights – she wrote “The Vindication of Women’s Rights” in 1792 – WAY ahead of her time…

- Edward Jenner was a pioneer in smallpox and is called the “Father of Immunology and is his work is thought to have saved more lives than any other person’s work!

- Patient Zero is the name they have assigned to the FIRST person to have contracted the HIV disease.

So it seems that the Biography people really DID do their homework and identified people who CHANGED OUR LIVES.

I am sure on a small scale there are people changing YOUR life and those of your family and friends. They might not be famous scientists, philosophers, writers, world leaders, but they are affecting your life positively.  Those are the unsung heros – some people might call them angels on earth, who made a difference every day.  Cherish them, tell them thank you, acknowledge them somehow. 

The people on the Biography list are mostly gone from the earth now – but their contributions continue to affect our lives profoundly.

On that note, I wish you a happy Columbus Day!

It scares ME because it is a GROSS statement being applied to the entire United States but I can tell you from PERSONAL experience, the real estate market in the Denver Metro area is “in recovery”.  Houses are being sold – sellers are selling and buyers are buying.

Well why do I know this?  As I said… from personal experience.   I put a nice but small house on the market in Lakewood.  It went under contract in under a week!  And after we went under contract I got calls from other brokers asking if there was any way the deal might fall through.

And how do I know that buyers are buying? I have been working with a nice young couple for about a month now and the last time we went to see homes, I started with a list of 10 homes to check out that day.  Two were already under contract, one was temporarily off the market, and by the time I got calls back from the listing companies with lockbox information, ANOTHER one was under contract.

So 30% of the narrow market that I am searching is under contract.  Hum… yes – definitely the sky is falling, no-one is buying, the market is terrible, oh my oh my!  I am mocking the news a bit because if you really think about it,  you KNOW that real estate is LOCAL.  You know of various neighborhoods that are “better” than others. You know that sometimes driving from one block to the next brings changes in the types and conditions of the homes… You know that on the SAME STREET, one house for sale can be in MUCH better condition for a reasonable price than the other one down the street on the same block!

So keep in mind that when you are evaluating the real estate market, focus FIRST on your town/city, then the neighborhoods you know or are considering, then the various streets… you will see differences – so ONE blanket statement summarizing market conditions just doesn’t make sense.

TODAY I heard from a mortage lender with whom that as of the end of August, she has already closed the same number of loans that she did ALL LAST YEAR! And she still has 4 months to go in the year. Admittedly they tend to be slower months, but she will undoubtedly have a way better year in 2010 than in 2009.  But the major news says real estate is NOT SELLING, the market is DOWN, again – oh my oh my.

So if you aren’t sure, check with your favorite realtor, lender, title person, home inspector, insurance agent, roofer, handyman, painter, landscaper, etc.  The list goes on and on… if they know what they are doing and are professional and ethical and experienced, they have customers and business closing this year… THEY will tell you very specifically how YOUR neighborhood or the one you are targeting is doing!

Good luck and happy selling or buying… interest rates are at an all-time low in history.  People with money will buy. It is like the Kevin Costner film “Field of Dreams” says – if you build it, they will come…   People are “coming” in DENVER!!!

Since Labor Day is right around the corner, I thought I would talk about DOING WHAT YOU LOVE TO DO…

 You have heard the phrase – Labor of Love?  My thinking is that we are all working very hard these days – seemingly harder than ever before. There is fear and frustration and uncertainty in everyone’s lives.

 But when HASN’T there been SOME quantity of those feelings?

 So I am thinking that as long as we are going to have some challenging days at work, we might as well do what we love to do and are probably good at. Those two things usually go hand in hand.

For me, I like solving puzzles – ask anyone in my family… I love doing Anacrostic puzzles, crosswords, I love Jeopardy and “hang-man’s noose” – otherwise known at Wheel of Fortune..

 So to ME, selling a house for someone, or helping them buy a house or renting out a house for an owner or finding the right tenants are just “puzzles” to be solved!

 Sometimes it takes a few different approaches to the puzzle to get it done correctly, but I always figure it out!

 To that end, last week I spent 3 days (long ones…) in an Employing Broker class. This means that I am NOW able to hire other Real Estate Brokers to work on the Magic Genie Realty team.

 I have grown my business to the point that I need some help to continue to provide the level of service, knowledge and attention that I expect to give to my buyers, sellers, owners and tenants every single day…

 So before the end of the year, I will be growing my team to include my sister-in-law Becky. She has been a very successful realtor in the past and I believe she will be a great addition to our team – she will be lending her time and expertise to the Property Management part of the business as well as working with her own buyers and sellers.  

Given my International Real Estate background and CIPS designation (Certified International Property Specialist), I am even contemplating adding “international” realtors to my team in the future.

To get back to the theme, I am DOING WHAT I LOVE and I am being blessed because of it. I have wonderful customers and vendors and people with whom I work every day!  Yes it is hectic and crazy every day and I kind of wish for a few days off from time to time but I wouldn’t work this hard and enjoy the results as much if I didn’t LOVE DOING IT!

 I am solving puzzles every day and I wouldn’t want it any other way.

 If you ask yourself the question – AM I DOING WHAT I LOVE, what will your answer be? 

 On that note, I wish everyone a safe and relaxing and fun LABOR DAY HOLIDAY!  Here’s to labor that you love doing… 

The person referring her to me knew nothing about the circumstances and didn’t even know this lady – she had just called her place of business and they didn’t do what this lady needed, so on she went to me.

It turns out she is a nice person who needs some guidance and coaching and reassurance.  She was self-deprecating but as we talked further she got more confident and understood what I was explaining to her.

Then the “moment of truth” came. She asked if I would consider coming to look at her house and if I would be willing to take it on as a rental.  I had to tell the truth.  I told her that all of my rentals are in “higher-end” neighborhoods and I was concerned about HER concerns. I told her that I do showings by myself and if she was concerned for her safety, I would be too.  Some of her comments earlier revolved around the lack of pride and ownership of the properties – she was surrounded by houses where she thinks renters are living and they are all “declining”… so I reminded her of that and told her that I do not visit any of my properties daily or weekly and would not be in the position to be responsible for managing a property where the renter is very likely NOT to take care of the property.  So the truth was that I probably was NOT going to be interested in this property.

You know what she said? She said  THANK YOU for being honest. She had talked with a few other people who had done the “razzle dazzle” talk with her and she had felt leery about them… and they didn’t really spend time with her explaining how rentals work. She said I was the first person who spent some time and SPOKE with her and taught her something and was honest and truthful about her potential situation.

So… as delicately as possible, TELL THE TRUTH.  From my earlier blogs, you know that I advocate CHOOSING the people you do business with.  You do NOT have to say YES all the time. Whatever new customer you take on must FIT YOUR BUSINESS MODEL.

There ARE property mangement companies who do take on “lower end properties” and do a great job and make a good living at it.  So there is a market and there are professionals who are out there to handle the lower end properties.  As an aside, I have just been given an opportunity to handle a nice one bedroom/one bath condo in the Cherry Creek area. The RENT amount will be the lowest I have handled thus far, but the neighborhood and the potential tenants will fit my business model and I am going to be taking it on!

So be honest, be truthful, do what makes sense for you. Don’t be rude to potential customers. Explain to them carefully when it doesn’t seem like you can help them out.  If you DO take them on and fail them (and yourself) then THAT is a bad move to make.

Do the right thing… I live my life by this mantra and it has NEVER let me down…

Now the husband has a great new job opportunity in a state that is back east, so she called to ask if I would like to be their realtor?  But of COURSE I would!  To work with them again will be an honor AND I know the house, the neighbhorhood and THEM! I can’t wait to see the boy who was a BABY (I mean TINY  baby, I got to hold him a few times) when we first met!  Wow!

We have always stayed in touch.  I added her to my email list and we could occassionally email back and forth… we have sent Christmas cards, she has copied me on her emails to her friends about some activities she is involved in!

So CHERISH your former customers. If you did a good job for them to start with, they will stay on your email list and not UNSUBSCRIBE.  Maybe they will keep you informed of their life changes, maybe they will refer you to their friends and family… but the neatest thing is that you will have continuity – like I get to see their 5 year old son who was the baby I held in my arms just before an open house I was doing for them when we listed their condo…

Life and the people in it are a blessing and I am thankful every day…