Blogging From The Desk of Alicia Lagarde-Craig
FLOOD FACTS
-Floods and flash floods happen in all 50 states.
-Everyone lives in a flood zone.
-Most homeowners insurance does not cover flood damage.
-If you live in a Special Flood Hazard Area (SFHA) or high-risk area and have a Federally backed mortgage, your mortgage lender requires you to have flood insurance. (To find your flood risk, fill out the Flood Risk Profile.)
-Just an inch of water can cause costly damage to your property.
-Flash floods often bring walls of water 10 to 20 feet high.
-A car can easily be carried away by just two feet of floodwater.
-Hurricanes, winter storms and snowmelt are common (but often overlooked) causes of flooding.
-New land development can increase flood risk, especially if the construction changes natural runoff paths.
-Federal disaster assistance is usually a loan that must be paid back with interest.
-If you live in a moderate-to-low risk area and are eligible for the Preferred Risk Policy, your flood insurance premium may be as low as $129 a year, including coverage for your property's contents.
-You are eligible to purchase flood insurance as long as your community participates in the National Flood Insurance Program.
-It takes 30 days after purchase for a policy to take effect, so it's important to buy insurance before the floodwaters start to rise.
-In a high-risk area, a home is more than twice as likely to be damaged by flood than by fire.
-Anyone can be financially vulnerable to floods. People outside of high-risk areas file over 20% of NFIP claims and receive one-third of disaster assistance for flooding.
-The average annual U.S. flood losses in the past 10 years (2001-2010) were more than $2.7 billion.
-When your community participates in the Community Rating System (CRS), you can qualify for an insurance premium discount of up to 45%.
-Since 1978, the NFIP has paid over $36.9 billion for flood insurance claims and related costs (as of 12/31/10).
-Over 5.5 million people currently hold flood insurance policies in more than 21,000 communities across the U.S.
Increased Cost of Compliance (ICC) - Coverage for expenses a property owner must incur, above and beyond the cost to repair the physical damage the structure actually sustained from a flooding event, to comply with mitigation requirements of state or local floodplain management ordinances or laws. Acceptable mitigation measures are elevation, flood-proofing, relocation, demolition, or any combination thereof.
Monday, July 23, 2012
Wednesday, April 25, 2012
5 Facts for Buyers Who Want to Submit Lowball Offers
A housing transaction, at the most fundamental level, includes one person who wants to sell and one person who wants to buy. Once the terms are agreed upon, voilà! . . . You have a win-win situation.
However, if the seller is miserable with the final terms or feels like they had to settle for a lowball offer; the deal is likely to unravel or turn ugly. And if it does fall through, that causes aggravation and costs valuable time and money for everyone involved.
Here are five facts that a buyer can use to prevent submitting lowball offers:
1. Market temperature matters.
The temperature of the market affects everything, from how buyers shop to what the “right price” is for a home.
One way to do this is to show the percentage difference between the actual list and sale prices for the properties in your neighborhood. It speaks volumes about the current market’s activity. Comparing list vs. sale prices also provides a strong indicator of which direction the market is moving and how much less or maybe even more, than the asking price a buyer should offer.
2. Apples are apples.
When analyzing the comps, make sure the buyers see an apples-to-apples match to their home candidate. Any similarities or differences should be explained to help the buyers see how to analyze the characteristics in the prospective homes. Putting the potential new property head-to-head with the other properties on the market today or those that have sold within 60 days can help buyers understand how key details like square footage, amenities, lot size, age, condition, and others can affect the price.
3. Time is money.
Data from the National Association of Realtors® shows that the typical home search takes 12 weeks. If a buyer starts to lean toward lowballing when it’s offer time, it is critical to point out important time facts like how long inventory lasts and how many hours, days, and weeks you both have invested in finding the right property. Saving time can be a serious motivator for buyers, especially those who have endured a long three months of hunting.
4. Sellers are people too.
If the sellers purchased their house between 2005 and 2009, chances are that property has lost value. They are not happy about it and, whatever their reasons for selling, they are already very frustrated at having to sell at a loss. The sellers are already losing money and will push very hard not to lose any more. Selling your home is an emotional decision all on its own, in addition to factoring in that the property is being sold at a loss.
As a buyer’s agent, it is important to remind the buyers that when people sell their property, they are selling a piece of themselves. A house is the setting of someone’s life. For the seller, its value includes what it represents, not just what it lists for. So while submitting a lowball price sounds like a great way to get a cheap deal, it can start the negotiation process on the wrong foot. A seller and a good seller’s agent will not take that offer seriously. In fact, even if they do respond, that seller now does not want to sell the home to that particular buyer and will do almost anything to encourage another buyer to step up.
5. The wrong offer can cause buyers to miss out.
When I started buying property, I came across a little 1950s Creole Cottage that was about to go on the market at $40,000. It was a fixer-upper and, at that price, it was a very good deal. Although I would have been willing to pay the asking price or close to it, I wanted to see if I could lowball and get it for less. Against my better judgement, I offered $20,000. I thought they would come back with a counter and that we would ultimately close the deal at $35,000. Well, they did counter, but with another potential buyer whose initial offer was $30,000. They were so offended by my low offer that they initially refused to sell it to me at any price. With a little begging and pleading, I was able to acquire the property at an acceptable price by all parties involved.
Most buyers today are smart. With the right data and encouragement from their real estate agent, they will normally agree to submit a reasonable initial offer.
For more information on this blog or any real estate question or need. Contact Alicia Lagarde @ AliciaLagarde@myNOLAhome.com or visit www.myNOLAhome.com
Wednesday, February 1, 2012
7 Reasons Why Now Is The Best Time To Buy a Home
Blogging From The Desk of Alicia Lagarde Craig
1. Homes have never been more affordable.
Do you realize that today people are buying houses at the same prices they were ten years ago? It's like having a time machine: you get to go back and buy at yesterday's prices today. One of the advantages of buying at the lower end of the market is that in a few years it will appreciate more than homes that are more expensive. Homes that now cost $100,000 are likely to appreciate to between $130,000 and $150,000, while homes starting at the $500,000 won't reach $650,000-$700,000 in the same time frame. That's because there is less demand the higher you go. Demand drives price increases and, as the market improves, demand for lower price points will go up faster than at the higher end.
2. Mortgage rates are at rock bottom and won't stay there forever.
The national average on a 30-year fixed-rate mortgage dropped to 4.36% in August 2010 - lower than it's been in the past half century. Once rates start going up again, they can go up fast - creating a major impact on monthly finances. Do you know that if your interest goes up 1%, your monthly payment will go up 10%? What's more likely? Home values dropping 10% or interest rates going up 1%?
3. Lenders are back in the game!
The final quarter of 2009's financial meltdown led to a sense that financing had dried up, but mortgage funds are alive and available. The majority of banks make money by making loans - they simply have to get back in the game. Most people don't know that it is still possible to get a loan with as little as 0-3% down where your credit score isn't the only determining factor.
4. Prices are trending back up
Every major price index points to a housing market that has hit bottom and is moving in a positive direction. After thirty months of declining values, home prices appear to be stable or appreciating in nearly every U.S. market. Locally, in the New Orleans Uptown market, prices are trending back up and sellers are beginning to see the shift from a buyer's market to a seller's market, meaning that sellers are not willing to make the concessions that they use to make in the past and they are also starting to see competing offers from different buyers on their homes.
5. Sellers are motivated!
When speaking of the New Orleans Metropolitan Area (i.e. Lakeview/Lakefront, Metairie, Mid-City, The Northshore), Supply now exceeds demand and buyers have the upper hand. This means lots of choices, lots of negotiating power and smart sellers fiercely competing by offering great prices and excellent conditions.
6. Ownership costs are dropping below rental costs!
The recent downturn in the housing market resulted in a drop in rental rates, but rents are back on the rise while the cost of home ownership has dropped.
Did you know that everyone is buying real estate, just not necessarily for themselves? If you are renting, you are buying real estate for your landlord. Wouldn't you rather be buying it for yourself?
7. Home ownership remains at the core of the American Dream
A recent Fannie Mae study reveals that the majority of Americans still aspire to own a home.
-Owning a home is critical to financial stability and wealth building.
-A home serves as a forced savings account and provides a solid asset, as well as a place to live.
-Despite the recent market upheaval, the vast majority of Americans still consider home ownership to be important to the economy and preferable to renting.
-Since the end of World War II, promoting home ownership has been high on the list of the federal government's priorities, and will continue to be so.
If you need assistance in real estate, contact Alicia Lagarde Craig or Jeff Craig @ 504.352.6190 or 504.382.3724.
References: KW Seize the Market Action Book
1. Homes have never been more affordable.
Do you realize that today people are buying houses at the same prices they were ten years ago? It's like having a time machine: you get to go back and buy at yesterday's prices today. One of the advantages of buying at the lower end of the market is that in a few years it will appreciate more than homes that are more expensive. Homes that now cost $100,000 are likely to appreciate to between $130,000 and $150,000, while homes starting at the $500,000 won't reach $650,000-$700,000 in the same time frame. That's because there is less demand the higher you go. Demand drives price increases and, as the market improves, demand for lower price points will go up faster than at the higher end.
2. Mortgage rates are at rock bottom and won't stay there forever.
The national average on a 30-year fixed-rate mortgage dropped to 4.36% in August 2010 - lower than it's been in the past half century. Once rates start going up again, they can go up fast - creating a major impact on monthly finances. Do you know that if your interest goes up 1%, your monthly payment will go up 10%? What's more likely? Home values dropping 10% or interest rates going up 1%?
3. Lenders are back in the game!
The final quarter of 2009's financial meltdown led to a sense that financing had dried up, but mortgage funds are alive and available. The majority of banks make money by making loans - they simply have to get back in the game. Most people don't know that it is still possible to get a loan with as little as 0-3% down where your credit score isn't the only determining factor.
4. Prices are trending back up
Every major price index points to a housing market that has hit bottom and is moving in a positive direction. After thirty months of declining values, home prices appear to be stable or appreciating in nearly every U.S. market. Locally, in the New Orleans Uptown market, prices are trending back up and sellers are beginning to see the shift from a buyer's market to a seller's market, meaning that sellers are not willing to make the concessions that they use to make in the past and they are also starting to see competing offers from different buyers on their homes.
5. Sellers are motivated!
When speaking of the New Orleans Metropolitan Area (i.e. Lakeview/Lakefront, Metairie, Mid-City, The Northshore), Supply now exceeds demand and buyers have the upper hand. This means lots of choices, lots of negotiating power and smart sellers fiercely competing by offering great prices and excellent conditions.
6. Ownership costs are dropping below rental costs!
The recent downturn in the housing market resulted in a drop in rental rates, but rents are back on the rise while the cost of home ownership has dropped.
Did you know that everyone is buying real estate, just not necessarily for themselves? If you are renting, you are buying real estate for your landlord. Wouldn't you rather be buying it for yourself?
7. Home ownership remains at the core of the American Dream
A recent Fannie Mae study reveals that the majority of Americans still aspire to own a home.
-Owning a home is critical to financial stability and wealth building.
-A home serves as a forced savings account and provides a solid asset, as well as a place to live.
-Despite the recent market upheaval, the vast majority of Americans still consider home ownership to be important to the economy and preferable to renting.
-Since the end of World War II, promoting home ownership has been high on the list of the federal government's priorities, and will continue to be so.
If you need assistance in real estate, contact Alicia Lagarde Craig or Jeff Craig @ 504.352.6190 or 504.382.3724.
References: KW Seize the Market Action Book
Tuesday, January 31, 2012
Thursday, January 13, 2011
Listing Your Home Or Listings At The Magic Number
Blogging From The Desk of Alicia Lagarde-Craig
Finding the Magic Number:
Pricing strategies can help you market your listings and generate offers that turn into closed deals.
January 2011
"Once you get a real estate license, you can start telling consumers what their homes are worth," says Melanie McLane, ABR, CRB, owner of the Melanie Group in Jersey Shore, Pa. She’s a certified appraiser with more than 30 years’ experience in real estate. "But I find many people aren’t prepared or haven’t done their homework to know what the market will support before giving price estimates."
And just doing your homework isn’t the end of setting a price; it’s also important to have a pricing strategy that works for your market and your clients. Here are four techniques:
• Employ shock and awe. Remember Economics 101—the simple law of supply and demand? Adam Smith, the grandfather of modern economics, said when an asset is undervalued, the "invisible hand of the market" corrects the pricing to fair market value. It’s a principle that Amanda DiVito Parle, ABR, CRS, broker associate with RE/MAX Alliance of Arvada, Colo., has used to her sellers’ advantage. By drastically lowering the price on some of her luxury listings—a process she calls "shocking and awing the market"—she creates instant demand. "I listed a $1 million–plus property for $599,000, and a sales professional called and asked if it was correct," she says.
Often, properties can end up selling for more what you’d have originally listed them at. "You need to the drop the price so dramatically that buyers think it’s outrageous," she says. "They’ll determine the price. They’ll be eager to see the property and create a competitive bidding war."
• Set a market-leading price. "Do your homework on the local market and price the home to lead the market, not chase the market," says Rick Lawrence, e-PRO, SFR, a sales associate with RE/MAX Professionals Select in Naperville, Ill. He recommends showing sellers virtual tours of comparables to get them on the same page about setting a price that will lead the market.
• Pick an exact number. Ben Kinney, founder of the Home4Investment real estate team in Bellingham, Wash., assesses a listing’s value, setting a price to the dollar: $137,368 or $213,348, for example. "Consumers assume that even prices aren’t carefully calculated and probably just a home price thrown out for the sake of it." At least with Kinney, that notion is correct. He considers all the features of the home to reach a precise number.
• Don’t get counted out. It’s not uncommon to price a house slightly under an even price point, say at $199,000 instead of $200,000, to give the home a competitive edge. The trouble is, buyers who search for homes online (and virtually all do) are typically searching a range of prices, Kinney says. So a buyer looking for a $200,000–$250,000 house wouldn’t even see your $199,000 listing. By knowing the range buyers usually use for a neighborhood, you can price your listing for maximum exposure, Kinney says.
When the offers do start rolling in, take them seriously, McLane says. Sellers sometimes make the mistake of refusing reasonable offers early in the listing period. Help your clients understand that the longer their house sits, the less desirable it may become to active house hunters.
By Katherine Tarbox -- Senior Editor of REALTOR® Magazine
Finding the Magic Number:
Pricing strategies can help you market your listings and generate offers that turn into closed deals.
January 2011
"Once you get a real estate license, you can start telling consumers what their homes are worth," says Melanie McLane, ABR, CRB, owner of the Melanie Group in Jersey Shore, Pa. She’s a certified appraiser with more than 30 years’ experience in real estate. "But I find many people aren’t prepared or haven’t done their homework to know what the market will support before giving price estimates."
And just doing your homework isn’t the end of setting a price; it’s also important to have a pricing strategy that works for your market and your clients. Here are four techniques:
• Employ shock and awe. Remember Economics 101—the simple law of supply and demand? Adam Smith, the grandfather of modern economics, said when an asset is undervalued, the "invisible hand of the market" corrects the pricing to fair market value. It’s a principle that Amanda DiVito Parle, ABR, CRS, broker associate with RE/MAX Alliance of Arvada, Colo., has used to her sellers’ advantage. By drastically lowering the price on some of her luxury listings—a process she calls "shocking and awing the market"—she creates instant demand. "I listed a $1 million–plus property for $599,000, and a sales professional called and asked if it was correct," she says.
Often, properties can end up selling for more what you’d have originally listed them at. "You need to the drop the price so dramatically that buyers think it’s outrageous," she says. "They’ll determine the price. They’ll be eager to see the property and create a competitive bidding war."
• Set a market-leading price. "Do your homework on the local market and price the home to lead the market, not chase the market," says Rick Lawrence, e-PRO, SFR, a sales associate with RE/MAX Professionals Select in Naperville, Ill. He recommends showing sellers virtual tours of comparables to get them on the same page about setting a price that will lead the market.
• Pick an exact number. Ben Kinney, founder of the Home4Investment real estate team in Bellingham, Wash., assesses a listing’s value, setting a price to the dollar: $137,368 or $213,348, for example. "Consumers assume that even prices aren’t carefully calculated and probably just a home price thrown out for the sake of it." At least with Kinney, that notion is correct. He considers all the features of the home to reach a precise number.
• Don’t get counted out. It’s not uncommon to price a house slightly under an even price point, say at $199,000 instead of $200,000, to give the home a competitive edge. The trouble is, buyers who search for homes online (and virtually all do) are typically searching a range of prices, Kinney says. So a buyer looking for a $200,000–$250,000 house wouldn’t even see your $199,000 listing. By knowing the range buyers usually use for a neighborhood, you can price your listing for maximum exposure, Kinney says.
When the offers do start rolling in, take them seriously, McLane says. Sellers sometimes make the mistake of refusing reasonable offers early in the listing period. Help your clients understand that the longer their house sits, the less desirable it may become to active house hunters.
By Katherine Tarbox -- Senior Editor of REALTOR® Magazine
Friday, January 7, 2011
Purchasing a Home is Still a Good Investment
Blogging From The Desk of Alicia Lagarde-Craig
Even with several years of price declines, the typical seller who purchased a home eight years ago experienced a median equity gain of $33,000—a 24 percent increase—while sellers who were in their homes for 11 to 15 years saw a median gain of 40 percent. That’s according to NAR’s 2010 survey of home buyers and sellers, available at REALTOR.org/research. "Eighty-five percent of recent home buyers see their home as a good investment, and nearly half think that investment is better than stocks,” says Paul Bishop, NAR vice president of research. This indicates the long-term view of home ownership as a fundamental goal and value remains sound.
Even with several years of price declines, the typical seller who purchased a home eight years ago experienced a median equity gain of $33,000—a 24 percent increase—while sellers who were in their homes for 11 to 15 years saw a median gain of 40 percent. That’s according to NAR’s 2010 survey of home buyers and sellers, available at REALTOR.org/research. "Eighty-five percent of recent home buyers see their home as a good investment, and nearly half think that investment is better than stocks,” says Paul Bishop, NAR vice president of research. This indicates the long-term view of home ownership as a fundamental goal and value remains sound.
Tuesday, December 14, 2010
This Month in Real Estate (US) : December 2010
Blogging From The Desk of Alicia Lagarde-Craig
This Month in Real Estate: December 2010
This Month in Real Estate: December 2010
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