THE revolutionary Thomas Paine, who as a resident of New Rochelle provided it with name-dropping rights starting in the 18th century, was the first of many to do so. By the early 1900s, musical-theater lovers in the thousands had learned from a George M. Cohan show that New Rochelle was only “45 Minutes From Broadway.” In the 1960s, television audiences by the tens of thousands learned even more about the place, which Rob Petrie commuted to so he could be with his wife, Laura, in “The Dick Van Dyke Show.”
But lately, the buzz in New Rochelle has had more to do with real estate titans than artistic ones. Names like Donald J. Trump and Louis R. Cappelli are behind efforts to remake the downtown. And depending on whom you ask, the construction jangling nerves there represents either the rebirth of this city of almost 73,000, or a rejection of the less well off among them.
New buyers snapping up luxury condominiums at Trump Plaza couldn’t be more pleased with the changes downtown. Caren Polino, 30, and her fiancé, Michael Burke, 32, both educators who are buying a one-bedroom, one-and-a-half bath condo there, say they are looking forward to the onset of gentrification, by which they mean cafes, fashionable shops and nightlife.
Since they often travel to New York City, they are also pleased that since Cohan wrote his lyrics, the travel time to Grand Central Terminal has been reduced to 36 minutes (even less during rush hour).
Noam Bramson, the mayor, foresees not only the completion of the residences downtown, but also a realization of plans for developing the Echo Bay section of town along the Long Island Sound waterfront. Three builders have been vying to redevelop the site, over several years, with residences, retailing and public access to the water. The area, which abuts Larchmont, includes some 20 city owned or contracted acres.
But on Main Street, in the center of town, things are still bleak. The traffic stops and starts as cars dart around construction sites, police officers slap $100 tickets on double-parked cars, and tempers flare at the stream of red lights that seem timed to halt traffic at every intersection.
And as rebuilding preoccupies official interest, infrastructure basics like sidewalks show signs of neglect.
“It’s all getting to be too much,” Joseph Russo, a retired grocery store worker and 26-year resident, said one recent afternoon. “All this development may be good for the big boys, but I don’t see how it’s going to benefit people like me.”
What You’ll Find
The 11 square miles of New Rochelle cut a swath in a northwesterly direction from the city’s shoreline to the borders with Scarsdale and Eastchester.
In the historically Italian working-class southern section on the Sound, there are apartment buildings, town houses and neighborhoods of single-family homes. Small storefronts and ethnic restaurants line the three main roads crisscrossing the middle of town, where working-class and poorer residents have lately been rubbing elbows with the wealthier new-condo dwellers. To the north are the older suburban neighborhoods, with their large Tudor-style and colonial houses on well-tended lawns.
Demographically, too, the city is diverse — more so than many other parts of Westchester County. In the 2000 census, Hispanics made up 20.1 percent of the population and African-Americans 19.2 percent. There is a small but thriving Asian and South Asian population, which according to the census is almost 3 percent.
Of the changes taking place downtown, the most noticeable at the moment is the crane atop the 40-story, 187-unit Trump Plaza, which juts up into the sky like a giant thumb and can be seen from several towns away. The building, a Trump-Cappelli venture, is similar to one that the two developers recently completed in downtown White Plains.
Across Huguenot Street from Trump Plaza, the Virginia-based AvalonBay Communities is building a sister unit to the adjacent Avalon on the Sound, a 24-story high-rise rental tower with 412 units. The $180 million building under construction will have 39 stories and 588 rental units.
In all, more than 2,000 apartments and condos are expected to become available in the next five years, including two apartment towers with 371 residences proposed by Cappelli Enterprises as part of its $500 million LeCount Square mixed-use project, also downtown.
Elsewhere in the city, there is evidence of many less ambitious projects — small clusters of new town houses as well as renovations.
What You’ll Pay
The median sales price of a single-family home at the end of October was $715,000, just under the countywide median, which was $716,125 at the end of September, said Kathleen McAteer, manager of Century 21 Wolff’s New Rochelle office.
Forum: Owning and Renting a Home
A sampling of single-family houses on the market includes a four-bedroom raised ranch for $799,000, a four-bedroom, one-bath colonial for $569,000 and a five-bedroom colonial with three full and two half baths going for $1.85 million. At Trump Plaza, one-bedroom condos like Mr. Burke and Ms. Polino’s sell for $500,000 and up, with three-bedroom penthouses going for as much as $2 million.
Along Pelham Road, which runs parallel to the shoreline, new three-bedroom town houses at AnnMar Gardens are on the market for $779,000 to $849,000.
Last week there were 186 homes, 75 condos and 75 co-ops for sale. A house selling for $1.275 million has annual taxes of $19,883; Trump Plaza units selling for $800,000 have a common charge of $1,180 a month and taxes of $5,100 a year.
As elsewhere, said Ms. McAteer, the housing market is in a downturn. Houses are taking an average of 151 days to sell, she said, adding that some sellers have withdrawn properties rather than reduce prices.
But concerns about the opposite — an overheated market — are being fed by all the construction downtown, which could eventually force residents like Pam and Jose Hernandez to move elsewhere. Mrs. Hernandez, an administrative assistant, said she and her husband, who works for a tree service, have a 2-month-old son. They pay about $1,300 a month for a two-bedroom downtown, but she described it as increasingly hard to find an apartment for that amount. “Especially with a new baby now,” she said, “where would we go?”
Last spring, the City Council adopted a rule requiring that 10 percent of any new development be affordable housing. But most current projects, planned before the law took effect, will not have to comply.
Craig King, commissioner of development, said the city wanted to retain lower-income residents. “We’re not looking to drive people out,” he said. “We’re not interested in becoming a typical Westchester suburb.” He described New Rochelle’s Section 8 housing program as “vibrant, with 900 families.”
What to Do
For families with young children, the city’s well-kept parks and the Huguenot Children’s Library on North Avenue, a branch of the New Rochelle Public Library, are among its best assets, said Michelle P. Maidenberg, a mental health therapist. Dr. Maidenberg and her husband, Eric, an investment banker, live with their three sons — Addison, 6, Foster, 3, and Wyatt, 1 — in a six-bedroom colonial north of downtown in an area of homes dating to the 1920s and 1930s. In part, they chose the area because it is close to Beth El Synagogue Center, where they worship.
For recreation, the Maidenbergs also frequent New Roc City, a seven-year-old downtown entertainment and retail center with an arcade, movie theater and bowling alley.
Restaurant fare has become increasingly varied, with Indian, Chinese, Thai, Mexican and other Hispanic offerings in addition to Italian places like Juliano’s on Main Street. Gary Fosina recently opened Mo’s New York Grill, and like many other restaurateurs, he is banking on an infusion of residents downtown.
The Commute
From the New Rochelle Transit Center downtown, Metro-North Railroad service to Grand Central Terminal takes about 36 minutes, with some express trains making the trip in 32 minutes. Round-trip tickets during peak hours cost $15; monthly tickets cost $163.
The Schools
There are about 11,000 students in the City School District of New Rochelle in an early childhood center, six elementary schools, two middle schools and a high school.
On the SAT’s, New Rochelle High school students scored an average of 556 on the critical reading section and 572 on the math. The averages for the state were 493 and 510.
Of last year’s 532 graduates, 67 percent went on to four-year colleges and universities, and 28 percent to two-year colleges. Of those going to college last year, five are at Harvard and eight at Cornell. Yale, Brown, Columbia and Dartmouth each accepted one New Rochelle graduate, said Maggie MacNichol-Skau, a district spokeswoman.
The city also has private schools like Ursuline, for girls in Grades 6 through 12, and Iona Preparatory, for 9th- through 12th-grade boys.
The History
In 1929, the planning board wrote that New Rochelle was “at a critical point in its history.” The city had a “vibrant downtown full of entertainment and shopping opportunities,” although the parking shortage was severe, it said. About a decade later, two of the first branch department stores in the country — Arnold Constable and Bloomingdale’s — moved to town.
But during the 1980s, as the suburbs grew, such stores left for outlying shopping centers and the city’s fortune’s plummeted. It is that decline from which New Rochelle is now trying to recover.
What We Like
The waterfront is New Rochelle’s greatest asset, and developing the Echo Bay area could help return the city to vibrancy.
Going Forward
Traffic often snarls on main roads, although Mr. King, the commissioner, cited a study by AKRF Inc., a White Plains consulting firm, suggesting that some congestion was natural in a downtown and even a sign of economic health.
Wednesday, March 14, 2007
IN new developments around the region, model homes and apartments offer scenes of life that seem almost too perfect to be real
In downtown White Plains, at the Ritz-Carlton Hotel complex, for instance, where Louis R. Cappelli is building 213 condominiums, the walls of one bedroom are covered in cashmere, rose petals are strewn about a stainless steel Japanese soaking tub, and the bathroom cabinets are upholstered in leather. The lavishly appointed unit seems made to order for a well-heeled power couple.
At Van Wyck Glen, a community of 221 semiattached three- and four-bedroom single-family homes by Toll Brothers in Fishkill, a wine bottle and glasses sit atop the dresser in a master bedroom suite designed to soothe a young couple after a hard day with the kids. Downstairs, the smell of fresh-baked cookies wafts through the rooms.
At River Ridge at Hyde Park, a community of 162 town houses by Cambridge Development and Construction, a living room includes what most empty nesters have probably only dreamed about until now: a pristine white linen sofa, obviously never used by anyone under 30.
At Harbors at Haverstraw, an 800-unit complex being built on the Hudson riverfront by Ginsburg Development, a model includes an exotic art collection on the walls, expensive rugs on the living room floor and a whirlpool in the bathroom. (Unlike many model-home items, it can be ordered as an option in any unit.) It is a setting designed to project a lifestyle in some of the units for buyers in their late 50s or early 60s who are ready to enjoy the fruit of their labor.
And in Pelham, at the 66-unit Marbury Corners, another Ginsburg Development project, there is plastic sushi on the plates in the modernistic dining room of a stylish condo town house that appears to be occupied by 20-something professionals.
But do model rooms like these, much more picture-perfect than the way people actually live, really help to sell homes? Do suburban couples with children — especially couples commuting long distances from Fishkill to New York or White Plains — really believe they will get a chance to sip wine before retiring? Or are cashmere-covered walls just fanciful decorating notions gleaned from some upscale magazine?
As for the decanter of wine in the bedroom and the rose petals on the bathroom floor, Lauren Brady-Russell, the owner of LBR Design Collaborative in Deer Park, N.Y., an interior design firm, remarked, “Doesn’t everyone live that way?”
Perhaps not in real life, she conceded, but most home buyers at least like to dream about living the way the models depict life. Ms. Brady-Russell designed the model rooms at Harbors at Haverstraw and at Marbury Corners.
Indeed, fantasies about the joys of homeownership are so motivating for buyers that Toll Brothers spent $100,000 to $130,000 furnishing and decorating each model home in the Fishkill development, where houses sell for $465,000 to $527,000.
“It’s a very effective marketing tool,” Dan Zalinsky, a division senior vice president of Toll Brothers, said. “Model rooms help buyers envision what life could be like in a new home. They’re designed to tug on a buyer’s emotions.”
Mr. Zalinsky, who has four sons, the oldest 7, including newborn twins, said that he personally could not imagine taking time out to relax and have a glass of wine before going to bed. “Unless,” he added, “you have a homeowners’ association, like the one at Van Wyck Glen, taking care of outdoor chores like lawn mowing.”
Selling a home using a model involves appealing to all of the senses — hearing, sight, smell, touch and taste — said Rebecca Hanford, president of November Design Group in Austin, Tex. Her company, which designs the interiors of model homes for Toll Brothers, often uses real food, like cookies fresh from the oven, to entice prospective buyers. Sometimes, there is music playing in the background.
“We want home buyers to be able to experience the model in such a realistic way they actually put themselves into those rooms,” Ms. Hanford said. “The same theory applies to children’s spaces. We want a kid to say to his parents: ‘I like playing in that house. I want to stay here!’ ”
At the Residences at the Ritz-Carlton Westchester, the high-end White Plains project, Kylie Travis Cappelli, the developer’s wife, said she designed the interiors of the one- to three-bedroom condos, which cost $678,000 to $3.5 million, with no particular buyer in mind. “We’re just suggesting different options and leaving the rest to the buyers’ imaginations,” she said.
By contrast, Ms. Brady-Russell said she “scripted a detailed profile” of potential buyers at Harbors at Haverstraw, where condos are about $600,000 to more than $1 million.
For one model in a three-bedroom unit, the imaginary residents are an empty-nester couple. The husband is retired and has taken up gourmet cooking, and the model kitchen is filled with hanging herbs and cookbooks are open on the counter.
The wife, an art dealer who is still working, has an office in their home, and on the entry level her bookshelves are filled with pottery and other art.
In a survey conducted by the National Association of Homebuilders last year, 43 percent of the developers who responded said model homes were the primary marketing tool they used, and 71 percent said they use model homes at least some of the time to sell a house.
But according to Stephen J. Melman, director of economic services for the association, which is the home builders’ trade group, in the current sluggish housing market, fewer builders are relying solely on models, and more are turning to real estate agents. “When times are tough, you have to use everything in your arsenal,” Mr. Melman said.
As for a bedroom conducive to sipping wine, Mr. Melman said: “Most couples raising a young family are probably happy just to get the kids off to school on time. Instead of wine in the model, how about a nanny?”
Some brokers also think more realism can sometimes be helpful. J. P. Endres, president of the Westchester County Board of Realtors and president of David Endres Realtors in Scarsdale, said: “The bottle of Champagne by the hot tub is fine. The flowers in the vase are great. But sometimes, the model rooms are overdone, and buyers simply can’t relate to them.” That is especially true if a model portrays a lifestyle that is too expensive for a potential buyer, Ms. Enders said, because buyers may not consider the house.
Not that the items in model units are not attractive to somebody. Most such items — furniture, books and silk flowers — are sold off when the model, the last available house in a development, is sold, often to a buyer who has fallen in love with the furnishings and wants the model exactly as is, according to Mr. Zalinsky at Toll Brothers
By ELSA BRENNER
At Van Wyck Glen, a community of 221 semiattached three- and four-bedroom single-family homes by Toll Brothers in Fishkill, a wine bottle and glasses sit atop the dresser in a master bedroom suite designed to soothe a young couple after a hard day with the kids. Downstairs, the smell of fresh-baked cookies wafts through the rooms.
At River Ridge at Hyde Park, a community of 162 town houses by Cambridge Development and Construction, a living room includes what most empty nesters have probably only dreamed about until now: a pristine white linen sofa, obviously never used by anyone under 30.
At Harbors at Haverstraw, an 800-unit complex being built on the Hudson riverfront by Ginsburg Development, a model includes an exotic art collection on the walls, expensive rugs on the living room floor and a whirlpool in the bathroom. (Unlike many model-home items, it can be ordered as an option in any unit.) It is a setting designed to project a lifestyle in some of the units for buyers in their late 50s or early 60s who are ready to enjoy the fruit of their labor.
And in Pelham, at the 66-unit Marbury Corners, another Ginsburg Development project, there is plastic sushi on the plates in the modernistic dining room of a stylish condo town house that appears to be occupied by 20-something professionals.
But do model rooms like these, much more picture-perfect than the way people actually live, really help to sell homes? Do suburban couples with children — especially couples commuting long distances from Fishkill to New York or White Plains — really believe they will get a chance to sip wine before retiring? Or are cashmere-covered walls just fanciful decorating notions gleaned from some upscale magazine?
As for the decanter of wine in the bedroom and the rose petals on the bathroom floor, Lauren Brady-Russell, the owner of LBR Design Collaborative in Deer Park, N.Y., an interior design firm, remarked, “Doesn’t everyone live that way?”
Perhaps not in real life, she conceded, but most home buyers at least like to dream about living the way the models depict life. Ms. Brady-Russell designed the model rooms at Harbors at Haverstraw and at Marbury Corners.
Indeed, fantasies about the joys of homeownership are so motivating for buyers that Toll Brothers spent $100,000 to $130,000 furnishing and decorating each model home in the Fishkill development, where houses sell for $465,000 to $527,000.
“It’s a very effective marketing tool,” Dan Zalinsky, a division senior vice president of Toll Brothers, said. “Model rooms help buyers envision what life could be like in a new home. They’re designed to tug on a buyer’s emotions.”
Mr. Zalinsky, who has four sons, the oldest 7, including newborn twins, said that he personally could not imagine taking time out to relax and have a glass of wine before going to bed. “Unless,” he added, “you have a homeowners’ association, like the one at Van Wyck Glen, taking care of outdoor chores like lawn mowing.”
Selling a home using a model involves appealing to all of the senses — hearing, sight, smell, touch and taste — said Rebecca Hanford, president of November Design Group in Austin, Tex. Her company, which designs the interiors of model homes for Toll Brothers, often uses real food, like cookies fresh from the oven, to entice prospective buyers. Sometimes, there is music playing in the background.
“We want home buyers to be able to experience the model in such a realistic way they actually put themselves into those rooms,” Ms. Hanford said. “The same theory applies to children’s spaces. We want a kid to say to his parents: ‘I like playing in that house. I want to stay here!’ ”
At the Residences at the Ritz-Carlton Westchester, the high-end White Plains project, Kylie Travis Cappelli, the developer’s wife, said she designed the interiors of the one- to three-bedroom condos, which cost $678,000 to $3.5 million, with no particular buyer in mind. “We’re just suggesting different options and leaving the rest to the buyers’ imaginations,” she said.
By contrast, Ms. Brady-Russell said she “scripted a detailed profile” of potential buyers at Harbors at Haverstraw, where condos are about $600,000 to more than $1 million.
For one model in a three-bedroom unit, the imaginary residents are an empty-nester couple. The husband is retired and has taken up gourmet cooking, and the model kitchen is filled with hanging herbs and cookbooks are open on the counter.
The wife, an art dealer who is still working, has an office in their home, and on the entry level her bookshelves are filled with pottery and other art.
In a survey conducted by the National Association of Homebuilders last year, 43 percent of the developers who responded said model homes were the primary marketing tool they used, and 71 percent said they use model homes at least some of the time to sell a house.
But according to Stephen J. Melman, director of economic services for the association, which is the home builders’ trade group, in the current sluggish housing market, fewer builders are relying solely on models, and more are turning to real estate agents. “When times are tough, you have to use everything in your arsenal,” Mr. Melman said.
As for a bedroom conducive to sipping wine, Mr. Melman said: “Most couples raising a young family are probably happy just to get the kids off to school on time. Instead of wine in the model, how about a nanny?”
Some brokers also think more realism can sometimes be helpful. J. P. Endres, president of the Westchester County Board of Realtors and president of David Endres Realtors in Scarsdale, said: “The bottle of Champagne by the hot tub is fine. The flowers in the vase are great. But sometimes, the model rooms are overdone, and buyers simply can’t relate to them.” That is especially true if a model portrays a lifestyle that is too expensive for a potential buyer, Ms. Enders said, because buyers may not consider the house.
Not that the items in model units are not attractive to somebody. Most such items — furniture, books and silk flowers — are sold off when the model, the last available house in a development, is sold, often to a buyer who has fallen in love with the furnishings and wants the model exactly as is, according to Mr. Zalinsky at Toll Brothers
By ELSA BRENNER
Application by Developer to Build Apartments along Port Chester’s Recently Renovated Waterfront
Port Chester has seen great change along its coast on the Long Island Sound. Many developments have been made and several are still to come; everything being built so far is for the enrichment of the community. Not building apartments.
The new Costco is great for the village, the new movie theater, Marshall’s, Bed, Bath & Beyond and Commerce Bank are all incentives for people to come into downtown Port Chester. FMB Asset Management is looking to build a100-unit mid-rise building which would run alongside the currently under construction retail development.
Spending my entire 23 years living in Port Chester, I see the negative impacts that such an apartment would bring. The waterfront, or the marina as all the locals refer to that area as, used to be a place to hang out, enjoy the water (as filthy as it may be, it’s ours), meet friends before going out, etc. It was a social place; the youth could relax and stay out of the heavier traffic areas of Port Chester (and I don’t mean a place to hide and do bad things).
Now, with all of the construction and cops patrolling, there is no space for us anymore. Maybe the village feels that retail and recreation attractions will help those who once walked around the marina aimlessly, just passing time. They are wrong and adding apartments would make it even worse. These apartments will be on the higher end of prices due to their location and all the development going on around the area. This only means more pedestrian congestion in an area already losing surface area. Traffic is a nightmare already and an apartment building bringing 100 units will undoubtedly make matters worse.
There is simply no room for an apartment building. There was no room for Costco; they managed to squeeze it in there. There was no room for a theater, Marshall’s and Bed, Bath & Beyond but the village made room for them. And unless they literally build these apartments on the water, there is no room for them either but I’m sure they’ll find someplace to put it.
The new Costco is great for the village, the new movie theater, Marshall’s, Bed, Bath & Beyond and Commerce Bank are all incentives for people to come into downtown Port Chester. FMB Asset Management is looking to build a100-unit mid-rise building which would run alongside the currently under construction retail development.
Spending my entire 23 years living in Port Chester, I see the negative impacts that such an apartment would bring. The waterfront, or the marina as all the locals refer to that area as, used to be a place to hang out, enjoy the water (as filthy as it may be, it’s ours), meet friends before going out, etc. It was a social place; the youth could relax and stay out of the heavier traffic areas of Port Chester (and I don’t mean a place to hide and do bad things).
Now, with all of the construction and cops patrolling, there is no space for us anymore. Maybe the village feels that retail and recreation attractions will help those who once walked around the marina aimlessly, just passing time. They are wrong and adding apartments would make it even worse. These apartments will be on the higher end of prices due to their location and all the development going on around the area. This only means more pedestrian congestion in an area already losing surface area. Traffic is a nightmare already and an apartment building bringing 100 units will undoubtedly make matters worse.
There is simply no room for an apartment building. There was no room for Costco; they managed to squeeze it in there. There was no room for a theater, Marshall’s and Bed, Bath & Beyond but the village made room for them. And unless they literally build these apartments on the water, there is no room for them either but I’m sure they’ll find someplace to put it.
Projects Being Razed, People Left Devastated
To outsiders, they are eyesores; they are nothing but dirty, un-kept brick buildings which house the poor or the criminally minded, lower, darker side of society. Housing projects house more that these negative stereotypes, they also give some of America’s most denied citizens a place to live outside of the nasty, sometimes dangerous streets they roam.
A new trend has been developing in Westchester County. Thanks to the recent attractiveness of the county that has helped lure the likes of the Clintons, Joe Torre and Vanessa Williams, the cost of properties in Westchester has gone up and its appeal is helping a lot of people profit.
This newly formed interest, while making some realtors and developers very rich, is making some of Westchester’s oldest residents quite nervous about their future in this county.
Two of the biggest cities in Westchester, Yonkers and New Rochelle, have seen proposals written up requesting the replacement of tenement housing, which officials and developers see has havens for crime and poverty, to replace them with new townhouses.
Particularly targeted in Yonkers is Mulford Gardens, the 550-unit apartment project that has been around since 1940 and in New Rochelle, officials are trying to replace the Hartley Houses which opened their doors in 1947 and have 240 units with 236 single and two-family houses.
“They are trying to push us out of out homes,” said Heather Ashford, a 17-year tenant of Mulford Gardens. “Not everyone who lives in the projects is a poor criminal; some of us have jobs we go to everyday.”City officials are trying to replace old public housing and in their place, they hope to insert townhouses which will serve both the citizens and the city’s economics positively. Those residing in the tenements would not simply be disregarded. Many living in the projects will have the opportunity to live in the new townhouses that would be built, but not all.
A percentage of the houses to be built will be set aside for those lower-income families that presently reside in the projects. Another percentage, however, will be put on the market for normal rates. This would be done in an attempt to diversify the area and in essence, enrich the neighborhoods.Much of this change is thanks to a Federal incentive known as HOPE VI, a program which grants cities $20 million to replace “superblock” projects. “Superblock” projects are those stereotypical, high-rises that span a few blocks. Virtually, they become cities within cities.
Today’s projects are synonymous with poor people, non-working minorities or government leeches that would rather collect welfare than find a job. Many residents are resentful of these images and are afraid that false stereotypes are going to be the cause of their losing their neighborhoods.
“People think that all we do is hang out, make noise and cause trouble,” said Kendra Wilkins of Hartley. “I graduated High School, I got an associates degree and I work! People need to do their research before they go and label others.”
Whether the residents of housing projects are contributing to society or not, the fact is their situations need to be addressed. It is understandable for City officials to want to change housing to better enrich the city. It is also understandable for those living in the projects to be nervous and upset that their homes might be razed and they might be forced to relocate.
A new trend has been developing in Westchester County. Thanks to the recent attractiveness of the county that has helped lure the likes of the Clintons, Joe Torre and Vanessa Williams, the cost of properties in Westchester has gone up and its appeal is helping a lot of people profit.
This newly formed interest, while making some realtors and developers very rich, is making some of Westchester’s oldest residents quite nervous about their future in this county.
Two of the biggest cities in Westchester, Yonkers and New Rochelle, have seen proposals written up requesting the replacement of tenement housing, which officials and developers see has havens for crime and poverty, to replace them with new townhouses.
Particularly targeted in Yonkers is Mulford Gardens, the 550-unit apartment project that has been around since 1940 and in New Rochelle, officials are trying to replace the Hartley Houses which opened their doors in 1947 and have 240 units with 236 single and two-family houses.
“They are trying to push us out of out homes,” said Heather Ashford, a 17-year tenant of Mulford Gardens. “Not everyone who lives in the projects is a poor criminal; some of us have jobs we go to everyday.”City officials are trying to replace old public housing and in their place, they hope to insert townhouses which will serve both the citizens and the city’s economics positively. Those residing in the tenements would not simply be disregarded. Many living in the projects will have the opportunity to live in the new townhouses that would be built, but not all.
A percentage of the houses to be built will be set aside for those lower-income families that presently reside in the projects. Another percentage, however, will be put on the market for normal rates. This would be done in an attempt to diversify the area and in essence, enrich the neighborhoods.Much of this change is thanks to a Federal incentive known as HOPE VI, a program which grants cities $20 million to replace “superblock” projects. “Superblock” projects are those stereotypical, high-rises that span a few blocks. Virtually, they become cities within cities.
Today’s projects are synonymous with poor people, non-working minorities or government leeches that would rather collect welfare than find a job. Many residents are resentful of these images and are afraid that false stereotypes are going to be the cause of their losing their neighborhoods.
“People think that all we do is hang out, make noise and cause trouble,” said Kendra Wilkins of Hartley. “I graduated High School, I got an associates degree and I work! People need to do their research before they go and label others.”
Whether the residents of housing projects are contributing to society or not, the fact is their situations need to be addressed. It is understandable for City officials to want to change housing to better enrich the city. It is also understandable for those living in the projects to be nervous and upset that their homes might be razed and they might be forced to relocate.
Westchester May be Becoming the Land of the Wealthy but Many May be Getting Forced to Move Out
Westchester County has rapidly been developing both commercially and residentially. Over the past 15 years, the average cost of a home in Westchester has increased tremendously. In 1990, the median housing value was $283,500 and today the median is up almost 35% at $419,000.
Westchester’s close proximity to NYC, along with its own attractions, has made it a very desirable place to live. Businesses are also trying to establish bases in Westchester County having realized its great potential. The only problem with so many people yearning to live in this now prestigious county is that home sales increase at a swift pace. Going into the city is no longer the only option for Westchester residents looking to maintain high standards of living so luxury must be provided close to home.
Westchester is home to 23 colleges and universities, over a dozen private high schools, an airport, a nationally renown medical center in Valhalla (among other local hospitals), and hundreds of religious institutions. Every religious denomination is represented in this county, making it fairly easy for those from every facet to find a place of worship.
The racial diversity found throughout the county is revealing of a culture based on hard work and the appreciation of neighbors. The county is made up of many ethnicities and although improvements can be made to better diversify the county, it is more racially diversified than the US average. The majority of the county is 71.3% White, 14.2% Black, 15.6 Hispanic, 4 % Asian and the rest of the county is divided into smaller ethnic proportions.
Westchester County has so much to offer that every city, town and village from Mt. Vernon to Pound Ridge is seeing a transformation in the value of homes.
Russ Baker, a retired business owner from Pleasantville, saw his home profit 2,400% at its closing. He bought his home in 1982 for $35,000 and this year, it sold for $850,000. “The only bad thing is I have to relocate now,” he said. “There is no way I can retire in Westchester, living here is too expensive.”
Westchester residents cannot ignore the need for an increase in income necessary to survive in their county. Many people want to follow Hillary and make the move to the great suburbs of Westchester. Many businesses want to follow Pepsi, Kraft, IBM and MasterCard and make Westchester their headquarters.
Having so much wealth in the county would appear to be a positive gain for the image and the people of Westchester. The truth is many people are being left behind by this new upward trend. Some people are having a hard time keeping up with the changes; many are being left behind, perhaps even pushed aside.
Westchester’s close proximity to NYC, along with its own attractions, has made it a very desirable place to live. Businesses are also trying to establish bases in Westchester County having realized its great potential. The only problem with so many people yearning to live in this now prestigious county is that home sales increase at a swift pace. Going into the city is no longer the only option for Westchester residents looking to maintain high standards of living so luxury must be provided close to home.
Westchester is home to 23 colleges and universities, over a dozen private high schools, an airport, a nationally renown medical center in Valhalla (among other local hospitals), and hundreds of religious institutions. Every religious denomination is represented in this county, making it fairly easy for those from every facet to find a place of worship.
The racial diversity found throughout the county is revealing of a culture based on hard work and the appreciation of neighbors. The county is made up of many ethnicities and although improvements can be made to better diversify the county, it is more racially diversified than the US average. The majority of the county is 71.3% White, 14.2% Black, 15.6 Hispanic, 4 % Asian and the rest of the county is divided into smaller ethnic proportions.
Westchester County has so much to offer that every city, town and village from Mt. Vernon to Pound Ridge is seeing a transformation in the value of homes.
Russ Baker, a retired business owner from Pleasantville, saw his home profit 2,400% at its closing. He bought his home in 1982 for $35,000 and this year, it sold for $850,000. “The only bad thing is I have to relocate now,” he said. “There is no way I can retire in Westchester, living here is too expensive.”
Westchester residents cannot ignore the need for an increase in income necessary to survive in their county. Many people want to follow Hillary and make the move to the great suburbs of Westchester. Many businesses want to follow Pepsi, Kraft, IBM and MasterCard and make Westchester their headquarters.
Having so much wealth in the county would appear to be a positive gain for the image and the people of Westchester. The truth is many people are being left behind by this new upward trend. Some people are having a hard time keeping up with the changes; many are being left behind, perhaps even pushed aside.
Monday, February 26, 2007
A Thaw in the Housing Market
WHEN it comes to home sales in Westchester, spring seems to be arriving earlier than usual this year, according to brokers and others who monitor the residential real estate market.
After a November and December that were more sluggish than usual, phones are jangling again in real estate offices throughout the county and attendance at open houses is swelling, they report.
Usually, the spring selling season doesn’t start to warm up until mid-March, and its early arrival this year may indicate that an upswing in the market is finally under way, according to Greg Rand, a managing partner for Prudential Rand in White Plains, and other brokers.
This does not indicate that residential sales prices will be climbing, however; on the contrary, median sales prices may drop even further before stabilizing, Mr. Rand cautioned.
For the first time in an October-December quarter since 1994, when the Westchester-Putnam Multiple Listing Service began reporting statistics on a quarterly basis, the median price for a single-family home in Westchester dropped from the same quarter a year earlier. The median as of Dec. 31 was $630,000, down 3.4 percent from $652,250 at the end of the fourth quarter of 2005.
In addition, the number of sales for all residential properties in Westchester dropped 13.6 percent, to 2,077, in the fourth quarter of 2006, and the dollar volume of sales was down by 12.7 percent, to $1.315 billion, compared with the fourth quarter of 2005.
The median will probably be even lower at the end of the first quarter on March 31 — perhaps by as much as another 3 to 5 percent, Mr. Rand said, based on his tracking of sales so far this year.
These sales numbers, which at first glance could be seen as bad news, may actually be signs of a market that is finally growing healthier in Westchester, one of the most expensive counties in the United States, observed Joseph Houlihan, an owner of Houlihan & O’Malley Real Estate Services in Bronxville.
A continued decrease in the median sales price may be a dose of reality in what has been an inflated and one-sided market, he said. “There was a growing gap between what sellers wanted and buyers were willing to pay,” Mr. Houlihan said. “Now, though, it seems sellers are becoming more realistic and that gap may be closing.”
As an example, he cited the case of a three-bedroom, two-bath split level house in Eastchester that went on the market for $669,000 and sold within three weeks because it was priced in line with what comparable houses in the neighborhood were going for.
By comparison, Mr. Houlihan said, several of his agency’s listings that buyers perceived as overpriced have languished on the market, and some sellers have even taken them off the market altogether hoping that prices will soar again soon.
But many professionals believe that a resurgence in sales prices is not likely to happen in the short run. At the offices of the Westchester County Board of Realtors and the Westchester Putnam Multiple Listing Service in downtown White Plains, P. Gilbert Mercurio, chief executive of the Board of Realtors, said one reason for the recent slowdown was that “prices had overshot their mark” in recent years.
In addition to the increased realism on the part of sellers, Mr. Houlihan said, there were other factors causing an early flurry of activity in the market — notably, the handsome bonuses being handed out on Wall Street. “And even if they’re not actually buying yet,” he said of the current crop of house hunters, “there’s definitely a lot more looking going on.”
Linda Roth, the manager of Coldwell Banker Residential Brokerage’s Scarsdale office, cited a seven-bedroom newly built $4.5 million Tudor with lots of high-end extras on Carstensen Road in Scarsdale as “just the kind of house that Realtors are hoping will draw Wall Street financial types with bonus money in hand.”
But even investment professionals are exhibiting considerable caution, according to Cynthia Landis, a vice president and brokerage manager in Larchmont for Sotheby’s International. “There’s definitely bonus money out there,” she said, “but people are being very cagey when it comes to talking about it.”
Mr. Mercurio agreed that the county “is very dependent on what happens in New York City,” but he saw other factors in Manhattan that may also have contributed to the increased activity so early in the season.
“Even during the slowdown, about 24 percent of all single-family home sales in 2006 were in the $1-million-plus range,” he noted. “Westchester’s high-end market has always shown strength.”
He speculated that the thriving condo market and lower-than-average unemployment rates in Manhattan were enabling some owners there to sell and begin their search for homes in the suburbs.
The relatively broad selection of properties on the market is also playing a key role in the pickup in activity, said Mr. Rand, whose company has 21 offices, including seven in Westchester.
Westchester’s year-end inventory of 5,774 units in all categories was 21 percent higher than at the end of 2005, according to the latest report from the Board of Realtors. The current levels of inventory are comparable to those of the mid-1990’s, “which supported high-performing markets at the time,” the report said.
The largest choice of inventory is occurring in the condo market — “everything from new luxury units to ordinary duplexes and 20- to 30-year-old construction,” Mr. Mercurio said.
The condo market has fared better than the markets for single-family homes, co-ops and two to five-family homes, with the number of condo sales in October through December down only 4.2 percent, to 345, from the same quarter in 2005.
By comparison, sales for single-family homes were down 14.8 percent, to 1,121; co-op sales dropped 14.8 percent, to 437; and multifamily home sales slid 19.1 percent, to 174.
In addition, mortgage interest rates are expected to remain relatively stable, acting as a further lure for buyers, said Joseph Tringali, a banker with the Melville-based Capstar Mortgage Bankers, which has an office in New Rochelle.
“We’ve seen an upward trend in rates, but historically they’re still low,” he said.
Still, there is a concern about possible defaults among a group of people who took out adjustable rate mortgages two years ago and who also borrowed 100 percent of the purchase price of their house, Mr. Tringali said. A house that was purchased for $500,000 then, for example, might be worth less now, and the mortgage rates might be due to be adjusted upward.
Meanwhile, whatever the reason or combination of reasons, the Westchester market seems to “have finally passed through the low point,” Mr. Mercurio said, and appears to be moving ahead.
By ELSA BRENNER
After a November and December that were more sluggish than usual, phones are jangling again in real estate offices throughout the county and attendance at open houses is swelling, they report.
Usually, the spring selling season doesn’t start to warm up until mid-March, and its early arrival this year may indicate that an upswing in the market is finally under way, according to Greg Rand, a managing partner for Prudential Rand in White Plains, and other brokers.
This does not indicate that residential sales prices will be climbing, however; on the contrary, median sales prices may drop even further before stabilizing, Mr. Rand cautioned.
For the first time in an October-December quarter since 1994, when the Westchester-Putnam Multiple Listing Service began reporting statistics on a quarterly basis, the median price for a single-family home in Westchester dropped from the same quarter a year earlier. The median as of Dec. 31 was $630,000, down 3.4 percent from $652,250 at the end of the fourth quarter of 2005.
In addition, the number of sales for all residential properties in Westchester dropped 13.6 percent, to 2,077, in the fourth quarter of 2006, and the dollar volume of sales was down by 12.7 percent, to $1.315 billion, compared with the fourth quarter of 2005.
The median will probably be even lower at the end of the first quarter on March 31 — perhaps by as much as another 3 to 5 percent, Mr. Rand said, based on his tracking of sales so far this year.
These sales numbers, which at first glance could be seen as bad news, may actually be signs of a market that is finally growing healthier in Westchester, one of the most expensive counties in the United States, observed Joseph Houlihan, an owner of Houlihan & O’Malley Real Estate Services in Bronxville.
A continued decrease in the median sales price may be a dose of reality in what has been an inflated and one-sided market, he said. “There was a growing gap between what sellers wanted and buyers were willing to pay,” Mr. Houlihan said. “Now, though, it seems sellers are becoming more realistic and that gap may be closing.”
As an example, he cited the case of a three-bedroom, two-bath split level house in Eastchester that went on the market for $669,000 and sold within three weeks because it was priced in line with what comparable houses in the neighborhood were going for.
By comparison, Mr. Houlihan said, several of his agency’s listings that buyers perceived as overpriced have languished on the market, and some sellers have even taken them off the market altogether hoping that prices will soar again soon.
But many professionals believe that a resurgence in sales prices is not likely to happen in the short run. At the offices of the Westchester County Board of Realtors and the Westchester Putnam Multiple Listing Service in downtown White Plains, P. Gilbert Mercurio, chief executive of the Board of Realtors, said one reason for the recent slowdown was that “prices had overshot their mark” in recent years.
In addition to the increased realism on the part of sellers, Mr. Houlihan said, there were other factors causing an early flurry of activity in the market — notably, the handsome bonuses being handed out on Wall Street. “And even if they’re not actually buying yet,” he said of the current crop of house hunters, “there’s definitely a lot more looking going on.”
Linda Roth, the manager of Coldwell Banker Residential Brokerage’s Scarsdale office, cited a seven-bedroom newly built $4.5 million Tudor with lots of high-end extras on Carstensen Road in Scarsdale as “just the kind of house that Realtors are hoping will draw Wall Street financial types with bonus money in hand.”
But even investment professionals are exhibiting considerable caution, according to Cynthia Landis, a vice president and brokerage manager in Larchmont for Sotheby’s International. “There’s definitely bonus money out there,” she said, “but people are being very cagey when it comes to talking about it.”
Mr. Mercurio agreed that the county “is very dependent on what happens in New York City,” but he saw other factors in Manhattan that may also have contributed to the increased activity so early in the season.
“Even during the slowdown, about 24 percent of all single-family home sales in 2006 were in the $1-million-plus range,” he noted. “Westchester’s high-end market has always shown strength.”
He speculated that the thriving condo market and lower-than-average unemployment rates in Manhattan were enabling some owners there to sell and begin their search for homes in the suburbs.
The relatively broad selection of properties on the market is also playing a key role in the pickup in activity, said Mr. Rand, whose company has 21 offices, including seven in Westchester.
Westchester’s year-end inventory of 5,774 units in all categories was 21 percent higher than at the end of 2005, according to the latest report from the Board of Realtors. The current levels of inventory are comparable to those of the mid-1990’s, “which supported high-performing markets at the time,” the report said.
The largest choice of inventory is occurring in the condo market — “everything from new luxury units to ordinary duplexes and 20- to 30-year-old construction,” Mr. Mercurio said.
The condo market has fared better than the markets for single-family homes, co-ops and two to five-family homes, with the number of condo sales in October through December down only 4.2 percent, to 345, from the same quarter in 2005.
By comparison, sales for single-family homes were down 14.8 percent, to 1,121; co-op sales dropped 14.8 percent, to 437; and multifamily home sales slid 19.1 percent, to 174.
In addition, mortgage interest rates are expected to remain relatively stable, acting as a further lure for buyers, said Joseph Tringali, a banker with the Melville-based Capstar Mortgage Bankers, which has an office in New Rochelle.
“We’ve seen an upward trend in rates, but historically they’re still low,” he said.
Still, there is a concern about possible defaults among a group of people who took out adjustable rate mortgages two years ago and who also borrowed 100 percent of the purchase price of their house, Mr. Tringali said. A house that was purchased for $500,000 then, for example, might be worth less now, and the mortgage rates might be due to be adjusted upward.
Meanwhile, whatever the reason or combination of reasons, the Westchester market seems to “have finally passed through the low point,” Mr. Mercurio said, and appears to be moving ahead.
By ELSA BRENNER
Sunday, February 18, 2007
How to Sell Your Highly-Appreciated Home Tax-Free (or Almost)
It's been 10 years since Congress brought us the homeowner gain exclusion deduction -- one of the most powerful and useful tax-saving tools ever given to homeowners.
The deduction itself is simple: If you have lived in your home for two out of the previous five years, you get a tax break when you sell it. If you're married and you file a joint tax return the first $500,000 of gain (the difference between what you paid to buy the property and what you sold it for) you make on the sale is tax-free. If you're single, you get a tax break on the first $250,000 of gain. What constitutes "living in" is pretty flexible, too. Those two years don't have to be consecutive, nor do you have to physically live in your home every day. The IRS allows you to have temporary absences from your home each year that can be up to 11.5 months! You can literally buy a home, live in it for 2-3 weeks per year for two years and take the entire tax-free gain exclusion.
In most cases, this is a great strategy -- buy, hold for 2 years and sell, tax-free. But what happens when the tax-free gain exclusion amount is less than the profit you make on your home sale?
Sometimes the path of least resistance is the best path of all. Simply by taking the gain exclusion deduction you're saving $75,000 on the first $500,000 in profit. Because you've owned the property for more than one year, the remaining profit will only be taxed at the capital gains rate of 15 percent.
Another option would be to convert the home into a rental property by selling it at fair market value (FMV) into a business structure you own. A limited liability company (LLC) is a good choice in most states.
The advantages to this option are huge. First, you still get the tax-free gain exclusion deduction when you sell. Second, your home becomes a source of monthly income. You can refinance to pull some equity out if you need it for the purchase of another home, and, depending on how much equity you pull out, you should still be able to keep your "new" rental property cash-flowing, meaning the price you rent it out for will still be more than the costs to maintain it (mortgage, insurance, utilities, etc.). You'll still get the benefit of appreciation, even though the market isn't appreciating as fast anymore.
Third, because your LLC paid FMV, it gets the benefit of the "step-up" in basis, meaning that the sales price is the new basis. This is important, because an investment property can do something your personal residence can't: Depreciate.
Depreciation is perhaps the number one (or maybe number two) reason to get into real estate. The government looks at real estate (the buildings, not the land) as something that goes down in value. So every year the building is worth a little less than the year before. After a certain period of time (27 years for commercial, 39 years for residential) the building has depreciated to zero.
In practical terms, this means your LLC can take a yearly depreciation deduction against the basis. That's why being able to step-up the basis to current FMV is such a good thing -- your LLC has a much bigger basis to depreciate against. Depreciation doesn't cost you a dime, either -- it's what we call a "phantom" expense -- which means it is created without you having to spend any money, first.
Depreciation is just one of the deductions you are now able to claim through your LLC. There are hundreds of others. But because depreciation is a phantom expense, it can have a huge impact on your tax bill at the end of the day. Depreciation often contributes to the LLC reporting a paper loss at the end of the year, which can be used to offset your personal W-2 income, meaning your personal tax bill will go down, too. Yet even though the LLC shows a paper loss, it's actually making money for you each and every month.
So you get a huge tax break up front with the gain exclusion, a continuing source of passive income (from the rent) that is taxed at a lower rate than earned W-2 income, a giant source of deductions, a potential paper loss that will further reduce your W-2 income (and taxes), and you get to keep control of the property and benefit from its continued appreciation. What's not to love?
By Diane Kennedy
The deduction itself is simple: If you have lived in your home for two out of the previous five years, you get a tax break when you sell it. If you're married and you file a joint tax return the first $500,000 of gain (the difference between what you paid to buy the property and what you sold it for) you make on the sale is tax-free. If you're single, you get a tax break on the first $250,000 of gain. What constitutes "living in" is pretty flexible, too. Those two years don't have to be consecutive, nor do you have to physically live in your home every day. The IRS allows you to have temporary absences from your home each year that can be up to 11.5 months! You can literally buy a home, live in it for 2-3 weeks per year for two years and take the entire tax-free gain exclusion.
In most cases, this is a great strategy -- buy, hold for 2 years and sell, tax-free. But what happens when the tax-free gain exclusion amount is less than the profit you make on your home sale?
Sometimes the path of least resistance is the best path of all. Simply by taking the gain exclusion deduction you're saving $75,000 on the first $500,000 in profit. Because you've owned the property for more than one year, the remaining profit will only be taxed at the capital gains rate of 15 percent.
Another option would be to convert the home into a rental property by selling it at fair market value (FMV) into a business structure you own. A limited liability company (LLC) is a good choice in most states.
The advantages to this option are huge. First, you still get the tax-free gain exclusion deduction when you sell. Second, your home becomes a source of monthly income. You can refinance to pull some equity out if you need it for the purchase of another home, and, depending on how much equity you pull out, you should still be able to keep your "new" rental property cash-flowing, meaning the price you rent it out for will still be more than the costs to maintain it (mortgage, insurance, utilities, etc.). You'll still get the benefit of appreciation, even though the market isn't appreciating as fast anymore.
Third, because your LLC paid FMV, it gets the benefit of the "step-up" in basis, meaning that the sales price is the new basis. This is important, because an investment property can do something your personal residence can't: Depreciate.
Depreciation is perhaps the number one (or maybe number two) reason to get into real estate. The government looks at real estate (the buildings, not the land) as something that goes down in value. So every year the building is worth a little less than the year before. After a certain period of time (27 years for commercial, 39 years for residential) the building has depreciated to zero.
In practical terms, this means your LLC can take a yearly depreciation deduction against the basis. That's why being able to step-up the basis to current FMV is such a good thing -- your LLC has a much bigger basis to depreciate against. Depreciation doesn't cost you a dime, either -- it's what we call a "phantom" expense -- which means it is created without you having to spend any money, first.
Depreciation is just one of the deductions you are now able to claim through your LLC. There are hundreds of others. But because depreciation is a phantom expense, it can have a huge impact on your tax bill at the end of the day. Depreciation often contributes to the LLC reporting a paper loss at the end of the year, which can be used to offset your personal W-2 income, meaning your personal tax bill will go down, too. Yet even though the LLC shows a paper loss, it's actually making money for you each and every month.
So you get a huge tax break up front with the gain exclusion, a continuing source of passive income (from the rent) that is taxed at a lower rate than earned W-2 income, a giant source of deductions, a potential paper loss that will further reduce your W-2 income (and taxes), and you get to keep control of the property and benefit from its continued appreciation. What's not to love?
By Diane Kennedy
Sellers Could Lose Waiting for Buyers to Make Offers
One of the biggest mistakes sellers make in a buyers market is trying to price their houses with a "cushion" in the asking price for negotiation room. In the current market where most sellers find themselves, it's all back to price, condition and location.
Pricing the house from the start is the first offensive strike the seller possesses in his arsenal. The best way to determine price in our market is to start looking at two categories of real estate: solds and actives.
Properties that have sold in the last 30 days provide you a picture of what price range pulled in offers 60 days ago. By looking over those properties, you'll know if you're headed in the right direction with your price. Then, after seeing what's pulled in offers, look at where the competition is priced -- and price lower than the lowest price. If the trend is headed downward over the last 12 months the motivated seller will get in front of that price trend and sell for less than everyone.
This can be an emotional ordeal for sellers. The seller who approaches the sales price of a house like the asking price of a used car -- where negotiation and give-and-take is expected -- will also be calling the movers sooner and get through the transaction with the least amount of emotional turmoil.
Condition is the second part of this equation that sellers have control over in today's market. Folks -- it's got to look new. Period. Here are the steps that MUST be taken for a successful sale.
New paint. Everywhere. Don't leave one room unpainted. Paint is the cheapest, yet most effective way to give a house a face lift.
New carpet/flooring. This addition along with No. 1 makes people drop open their mouths with, "Wow."
Replace the small things. It's the attention to detail that can make a big difference for the buyers. New faucets throughout, new hardware on the doors, and new switches/plugs/plates take the house from just "cleaned up" to new.
Deep clean. I always have to mention this because a lot of sellers still just don't get it. It's still amazing to me how many people will leave a house in the "un-" condition. Unvacuumed, undusted, unwashed. Invite friends over for a deep cleaning or hire it out. This is a must, no questions asked.
Do you do windows? Well, somebody better. Get all the windows cleaned and caulked. The house may look great from the inside, but if you can't look outside because of the dusty film over the glass, steps 1 – 4 could be for naught.
Finally, location is what buyers are looking for. I saw a listing the other day that was obviously connected to a realistic agent and seller. It was a lot of house for the price with the 1-plus acre lot -- and it was "priced for location," because the house backed to a very busy 4-lane highway. The comps in the neighborhood were nearly $100,000 more.
While you may not be able to do anything about the location of your listing, you can definitely spin the benefits of where it's located. Near commuter routes means the house is next to big highways, but for some shoppers they just want to get home quick after work and this is going to be a benefit -- but only if you market it that way.
Sell the lifestyle of the house as much as the amenities of the house itself. With prices dropping in some areas, headlines such as "Quit Commuting," "Walk to Everything," and "Cut Your Gas Bill" are becoming more and more enticing. The third- to one-acre lot doesn't look as good after the 75-minute commute. Some commuters are looking to move back in to the work centers.
Market to buyers outside the community who would find your neighborhood attractive. It's amazing how many buyers don't mind a busy 2-lane street -- when they've been overlooking the Beltway for years. Remember to market the benefits that you liked about the house when you bought several years ago.
By M. Anthony Carr
Pricing the house from the start is the first offensive strike the seller possesses in his arsenal. The best way to determine price in our market is to start looking at two categories of real estate: solds and actives.
Properties that have sold in the last 30 days provide you a picture of what price range pulled in offers 60 days ago. By looking over those properties, you'll know if you're headed in the right direction with your price. Then, after seeing what's pulled in offers, look at where the competition is priced -- and price lower than the lowest price. If the trend is headed downward over the last 12 months the motivated seller will get in front of that price trend and sell for less than everyone.
This can be an emotional ordeal for sellers. The seller who approaches the sales price of a house like the asking price of a used car -- where negotiation and give-and-take is expected -- will also be calling the movers sooner and get through the transaction with the least amount of emotional turmoil.
Condition is the second part of this equation that sellers have control over in today's market. Folks -- it's got to look new. Period. Here are the steps that MUST be taken for a successful sale.
New paint. Everywhere. Don't leave one room unpainted. Paint is the cheapest, yet most effective way to give a house a face lift.
New carpet/flooring. This addition along with No. 1 makes people drop open their mouths with, "Wow."
Replace the small things. It's the attention to detail that can make a big difference for the buyers. New faucets throughout, new hardware on the doors, and new switches/plugs/plates take the house from just "cleaned up" to new.
Deep clean. I always have to mention this because a lot of sellers still just don't get it. It's still amazing to me how many people will leave a house in the "un-" condition. Unvacuumed, undusted, unwashed. Invite friends over for a deep cleaning or hire it out. This is a must, no questions asked.
Do you do windows? Well, somebody better. Get all the windows cleaned and caulked. The house may look great from the inside, but if you can't look outside because of the dusty film over the glass, steps 1 – 4 could be for naught.
Finally, location is what buyers are looking for. I saw a listing the other day that was obviously connected to a realistic agent and seller. It was a lot of house for the price with the 1-plus acre lot -- and it was "priced for location," because the house backed to a very busy 4-lane highway. The comps in the neighborhood were nearly $100,000 more.
While you may not be able to do anything about the location of your listing, you can definitely spin the benefits of where it's located. Near commuter routes means the house is next to big highways, but for some shoppers they just want to get home quick after work and this is going to be a benefit -- but only if you market it that way.
Sell the lifestyle of the house as much as the amenities of the house itself. With prices dropping in some areas, headlines such as "Quit Commuting," "Walk to Everything," and "Cut Your Gas Bill" are becoming more and more enticing. The third- to one-acre lot doesn't look as good after the 75-minute commute. Some commuters are looking to move back in to the work centers.
Market to buyers outside the community who would find your neighborhood attractive. It's amazing how many buyers don't mind a busy 2-lane street -- when they've been overlooking the Beltway for years. Remember to market the benefits that you liked about the house when you bought several years ago.
By M. Anthony Carr
Mortgage Rates Drift Upward in Freddie Mac's Weekly Primary Mortgage Market Survey
McLEAN, VA -- Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey (PMMS) in which the 30-year fixed-rate mortgage (FRM) averaged 6.30 percent with an average 0.4 point for the week ending February 15, 2007, up from last week when it averaged 6.28 percent. Last year at this time, the 30-year FRM averaged 6.28 percent.
The 15-year FRM this week averaged 6.03 percent with an average 0.4 point, up slightly from last week when it averaged 6.02 percent. A year ago, the 15-year FRM averaged 5.91 percent.
Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.01 percent this week, with an average 0.5 point, up from last week when it averaged 5.99 percent. A year ago, the 5-year ARM averaged 5.95 percent.
One-year Treasury-indexed ARMs averaged 5.52 percent this week with an average 0.6 point, up from last week when it averaged 5.49 percent. At this time last year, the 1-year ARM averaged 5.36 percent.
"Mortgage interest rates exhibited little change in the past week according to our weekly Primary Mortgage Market Survey, as there was little new information that would cause any great change," said Frank Nothaft, Freddie Mac vice president and chief economist. "For example, January's retail sales were virtually unchanged from December's level. Further, Fed Chairman Bernanke testified before the Senate committee and forecasted that the economy seemed likely to expand at a moderate pace this year and next with gradual easing in core inflation."
"In the course of the coming week, January's housing starts, producer price index and consumer price index are all scheduled for release. These will be the first indicators of the housing market and inflation in early 2007, and we could see interest rates move in response."
The 15-year FRM this week averaged 6.03 percent with an average 0.4 point, up slightly from last week when it averaged 6.02 percent. A year ago, the 15-year FRM averaged 5.91 percent.
Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.01 percent this week, with an average 0.5 point, up from last week when it averaged 5.99 percent. A year ago, the 5-year ARM averaged 5.95 percent.
One-year Treasury-indexed ARMs averaged 5.52 percent this week with an average 0.6 point, up from last week when it averaged 5.49 percent. At this time last year, the 1-year ARM averaged 5.36 percent.
"Mortgage interest rates exhibited little change in the past week according to our weekly Primary Mortgage Market Survey, as there was little new information that would cause any great change," said Frank Nothaft, Freddie Mac vice president and chief economist. "For example, January's retail sales were virtually unchanged from December's level. Further, Fed Chairman Bernanke testified before the Senate committee and forecasted that the economy seemed likely to expand at a moderate pace this year and next with gradual easing in core inflation."
"In the course of the coming week, January's housing starts, producer price index and consumer price index are all scheduled for release. These will be the first indicators of the housing market and inflation in early 2007, and we could see interest rates move in response."
Wednesday, February 14, 2007
Days on Market (DOM) Things to Know
Since the market has changed and some homes are languishing on the market, listing agents (seller's representives) face new challenges in marketing properties. I am currently working with a buyer and as we try to determine an accepable offer on a property we are reviewing a lot of information about houses that have sold in the past year and one of the things we are analyzing is How Long was that House on the Market (DOM)? This is where some listing agent's are manipulating the data. When a seller says to them, what are you doing to get my house sold? Often a listing agent will say why dont's we "refresh" the listing. Take if off the market, take new pictures, change some of the wording and put it back on the market. It will appear to be "new to market" to some buyer's who are just starting their search.
That is one way to manipulate a listing? Another is that some houses are really on the market for a year, during the year the listing has expired, and when it is put back on the market the agent lists it as new to market?? The listing also is sent out again to any buyer's who are receiving automatic updates as a new listing, it puts the property front and center, again in the hopes that an agent out there needs this kind of reminder to call their buyer's. They call this marketing, there is some discussion as to whether this is ethical or not? So if you are buying and discussing the length a particular property has been on the market, make sure that you are getting the whole story. I have always maintained that buyer's are smarter than that, seller's want to be proactive without reducing their price. Business Week is running an article on this subject this week. An except from their article:
"Agents are pulling houses off the market and then presenting them as new offerings Real estate agent Ross Simone wasn't attracting any potential buyers for a house in Mechanicsville, Md., that had sat on the market for months, so last November he took action. He pulled the house out of the regional database of active listings and then immediately reinserted it, changing the property ID number used to track properties over time. The result: The house appeared to be hitting the market for the first time. "It's in the best interests of my client [the seller]," Simone said in a November interview. "I started doing it consistently this year. I do it as much as I can.""
"When many homes in an area are re-listed as new, it skews the "average days on market" statistic, making the market look healthier than it really is. For sellers, refreshing a listing can also disguise the fact that the previous listing was at a higher price. Buyers often regard a price cut as a sign of weakness.Whether it's within the local rules or not, the practice of relisting houses to give them a new debut is a symptom of an imbalance in market knowledge."
So ask your agent to make sure they search for history by address to pick up prior information. Yet, another reason to work with a Buyer's Agent. A Seller's Agent or Dual Agent may feel it isn't in the Seller's best interests to expose this information.
That is one way to manipulate a listing? Another is that some houses are really on the market for a year, during the year the listing has expired, and when it is put back on the market the agent lists it as new to market?? The listing also is sent out again to any buyer's who are receiving automatic updates as a new listing, it puts the property front and center, again in the hopes that an agent out there needs this kind of reminder to call their buyer's. They call this marketing, there is some discussion as to whether this is ethical or not? So if you are buying and discussing the length a particular property has been on the market, make sure that you are getting the whole story. I have always maintained that buyer's are smarter than that, seller's want to be proactive without reducing their price. Business Week is running an article on this subject this week. An except from their article:
"Agents are pulling houses off the market and then presenting them as new offerings Real estate agent Ross Simone wasn't attracting any potential buyers for a house in Mechanicsville, Md., that had sat on the market for months, so last November he took action. He pulled the house out of the regional database of active listings and then immediately reinserted it, changing the property ID number used to track properties over time. The result: The house appeared to be hitting the market for the first time. "It's in the best interests of my client [the seller]," Simone said in a November interview. "I started doing it consistently this year. I do it as much as I can.""
"When many homes in an area are re-listed as new, it skews the "average days on market" statistic, making the market look healthier than it really is. For sellers, refreshing a listing can also disguise the fact that the previous listing was at a higher price. Buyers often regard a price cut as a sign of weakness.Whether it's within the local rules or not, the practice of relisting houses to give them a new debut is a symptom of an imbalance in market knowledge."
So ask your agent to make sure they search for history by address to pick up prior information. Yet, another reason to work with a Buyer's Agent. A Seller's Agent or Dual Agent may feel it isn't in the Seller's best interests to expose this information.
2006 4th Quarter Residential Real Estate Report for Westchester County, New York
Just Posted! The 2006 4th Quarter and Full Year Residential Real Estate Sales Report from the Westchester-Putnam Multiple Listing Service. Some excerpts:
''The median price of a single-family house declined last quarter in Westchester County for the first time in nearly 12 years, and further price declines can be expected early this year, the Westchester-Putnam Multiple Listing Service said yesterday.
Inventories rose and sales dropped for every type of housing in Westchester fourth quarter of 2006, year over year. The only housing that saw increases in median prices were co-op apartments in Westchester. The median house price of $630,000 was down 3.4 percent from a year earlier. Condominium median prices dropped by 2.3 percent to $375,000. The median price on Westchester co-ops rose 5.1 percent to $184,000"
Many sellers today are demanding prices that their neighbors had obtained during home sales of a year earlier, Mercurio said. In the meantime, some buyers "think there are fire sales going on,"
Year-end inventories of all housing types grew by 20.9 percent in Westchester
Average sale prices have doubled since 1999, and the proportion of single-family houses that have sold for $1 million or more has increased from 10 percent in 1999 to 25 percent a year ago, the MLS said"
Read the full report at: http://www.wcbr.net/Library/stats/stats06/fl_4th06.pdf
''The median price of a single-family house declined last quarter in Westchester County for the first time in nearly 12 years, and further price declines can be expected early this year, the Westchester-Putnam Multiple Listing Service said yesterday.
Inventories rose and sales dropped for every type of housing in Westchester fourth quarter of 2006, year over year. The only housing that saw increases in median prices were co-op apartments in Westchester. The median house price of $630,000 was down 3.4 percent from a year earlier. Condominium median prices dropped by 2.3 percent to $375,000. The median price on Westchester co-ops rose 5.1 percent to $184,000"
Many sellers today are demanding prices that their neighbors had obtained during home sales of a year earlier, Mercurio said. In the meantime, some buyers "think there are fire sales going on,"
Year-end inventories of all housing types grew by 20.9 percent in Westchester
Average sale prices have doubled since 1999, and the proportion of single-family houses that have sold for $1 million or more has increased from 10 percent in 1999 to 25 percent a year ago, the MLS said"
Read the full report at: http://www.wcbr.net/Library/stats/stats06/fl_4th06.pdf
Sunday, February 11, 2007
How Much is Too Much to Fix up Your House?
As with any resale product, the person trying to sell said product will usually try to make the product look as new as possible to ensure the highest profit available. In reviewing many of the homes on the market today, however, some sellers don't get that notion.
Don't make the mistake of the seller who, knowing full well that buyers were coming by, not only failed to do a fresh clean up, but also left his underwear on the exercise bike, a pan of crusty macaroni and cheese on the stove and debris throughout the yard.
There are some task items any seller should consider when selling a house. Even if you decide to sell "as is," a little soap and water could put a few more bucks in your pocket. With that in mind, let's look at what sellers should look at doing with any house they want to put on the market; what to do when you want to get a little more money; and how to compete with the Joneses when looking to prepare your home for sale.
Any House
All homes going on the market should receive a deep cleaning. This is the cleaning that you do when … well, you would never do it unless you're selling your house (or you're just an absolute neatnik. This involves scrubbing every cranny of the house. Nothing goes unscrubbed. I would suggest bringing in a professional group to get this done and plan on spending a couple hundred bucks (maybe more) to get the house ready for your new buyer.
Next, declutter the house. Go ahead and rent a huge storage unit and fill it up. Plan this with a bunch of pre-made boxes that have lids you can tape shut and label. Take extra kid's toys to charity. Donate all clothes that are even a bit too tight or out of date. Remove excess furniture (or even cover with matching covers).
Repair and paint where needed. As with most homes that have been lived in, that would be all of them. Walk through a new construction home to see what you're up against and then go and make yours look as best you can on your budget.
Landscaping. Thankfully, mulch and flowering plants don't really cost a lot of money for those who are just sprucing up. Before going out and paying for a designer-created landscaping job, start with the local garden center and get some free advice on how to spruce up on a budget. Fresh, flowering plants (even in fall and winter) can make the house look oh-so much better.
Even if you're selling as-is, the above four tips are a must. Next is where we spend a little more money.
Redecorating
Renewed color. Giving your house a makeover doesn't have to cost you a second mortgage. The first item to consider for rehab is your color selection. While the traditional advice is "go vanilla," professionally selected colors (not too bold) can make a "nice" house into a "wow" house.
Flooring is one of the best moderately priced upgrades a seller can install to make a huge difference. While I like the concept of "choose-your-own-carpet" offers in home listings, think about what else it's saying: "We're too cheap to fix up the house now, so we'll let you walk through our tattered, stained carpeting and let you get it installed the weekend after we leave." Like I said, make your house a "wow" by making that first great impression with new carpet.
Replacing dated items. Sometimes replacing certain items in the house is really more like maintaining your home instead of upgrading it. Items like windows, doors, light fixtures, faucets, door hardware, etc., need upgrading and replacing periodically. A walk down the light aisle at your favorite hardware store reveals this could be done on a budget. Nevertheless, there's nothing more gross looking than a brass light fixture that's chipping and rusting.
Keeping up with the Joneses
At some point you have to look at what the neighbors are doing and keep up or you'll lose out. If everyone in the neighborhood is ripping out the old and installing the new (kitchen, bath, carpet, doors, etc.) then you may be forced to do the same thing long before you're thinking of putting your home on the market. My wife and I are facing that right now with the kitchen. It's starting to show its age, which means before we put the house on the market in a few years, if I want the best buyer (or any buyer for that matter) the kitchen cabinets need an upgrade.
Redo, Remodel, Relax
As you look around the house, making your list of things to change before putting the house on the market, remember to create some time to enjoy your new digs before selling the place. If a sale is on your horizon and you must redo the landscaping before putting the house on the market -- do it early so you can drive home to the professionally designed flowerbeds and floral creations a few months or years before selling it to someone else.
While you want to repair, paint, remodel and add on to your house because it adds value to your home, every homeowner should especially do it because they want to enjoy the changes as well.
Don't make the mistake of the seller who, knowing full well that buyers were coming by, not only failed to do a fresh clean up, but also left his underwear on the exercise bike, a pan of crusty macaroni and cheese on the stove and debris throughout the yard.
There are some task items any seller should consider when selling a house. Even if you decide to sell "as is," a little soap and water could put a few more bucks in your pocket. With that in mind, let's look at what sellers should look at doing with any house they want to put on the market; what to do when you want to get a little more money; and how to compete with the Joneses when looking to prepare your home for sale.
Any House
All homes going on the market should receive a deep cleaning. This is the cleaning that you do when … well, you would never do it unless you're selling your house (or you're just an absolute neatnik. This involves scrubbing every cranny of the house. Nothing goes unscrubbed. I would suggest bringing in a professional group to get this done and plan on spending a couple hundred bucks (maybe more) to get the house ready for your new buyer.
Next, declutter the house. Go ahead and rent a huge storage unit and fill it up. Plan this with a bunch of pre-made boxes that have lids you can tape shut and label. Take extra kid's toys to charity. Donate all clothes that are even a bit too tight or out of date. Remove excess furniture (or even cover with matching covers).
Repair and paint where needed. As with most homes that have been lived in, that would be all of them. Walk through a new construction home to see what you're up against and then go and make yours look as best you can on your budget.
Landscaping. Thankfully, mulch and flowering plants don't really cost a lot of money for those who are just sprucing up. Before going out and paying for a designer-created landscaping job, start with the local garden center and get some free advice on how to spruce up on a budget. Fresh, flowering plants (even in fall and winter) can make the house look oh-so much better.
Even if you're selling as-is, the above four tips are a must. Next is where we spend a little more money.
Redecorating
Renewed color. Giving your house a makeover doesn't have to cost you a second mortgage. The first item to consider for rehab is your color selection. While the traditional advice is "go vanilla," professionally selected colors (not too bold) can make a "nice" house into a "wow" house.
Flooring is one of the best moderately priced upgrades a seller can install to make a huge difference. While I like the concept of "choose-your-own-carpet" offers in home listings, think about what else it's saying: "We're too cheap to fix up the house now, so we'll let you walk through our tattered, stained carpeting and let you get it installed the weekend after we leave." Like I said, make your house a "wow" by making that first great impression with new carpet.
Replacing dated items. Sometimes replacing certain items in the house is really more like maintaining your home instead of upgrading it. Items like windows, doors, light fixtures, faucets, door hardware, etc., need upgrading and replacing periodically. A walk down the light aisle at your favorite hardware store reveals this could be done on a budget. Nevertheless, there's nothing more gross looking than a brass light fixture that's chipping and rusting.
Keeping up with the Joneses
At some point you have to look at what the neighbors are doing and keep up or you'll lose out. If everyone in the neighborhood is ripping out the old and installing the new (kitchen, bath, carpet, doors, etc.) then you may be forced to do the same thing long before you're thinking of putting your home on the market. My wife and I are facing that right now with the kitchen. It's starting to show its age, which means before we put the house on the market in a few years, if I want the best buyer (or any buyer for that matter) the kitchen cabinets need an upgrade.
Redo, Remodel, Relax
As you look around the house, making your list of things to change before putting the house on the market, remember to create some time to enjoy your new digs before selling the place. If a sale is on your horizon and you must redo the landscaping before putting the house on the market -- do it early so you can drive home to the professionally designed flowerbeds and floral creations a few months or years before selling it to someone else.
While you want to repair, paint, remodel and add on to your house because it adds value to your home, every homeowner should especially do it because they want to enjoy the changes as well.
Appraisers Say Pressure on Them to Fudge Values is Up Sharply
Nine out of 10 real estate appraisers say they've been pressured to raise property valuations by mortgage brokers, realty agents, lenders and individual home sellers.
That represents a huge increase over just the past three years, according to October Research Corp., the principal sponsor of a nationally-representative survey of appraisers. Richfield, Ohio-based October Research, publisher of the trade journal Valuation Review, polled 1,200 appraisers from all 50 states plus the District of Columbia and Puerto Rico in 2003 and 2006.
Forty-five percent of those polled in 2003 said they had "never" been pressured to fudge the numbers on valuations, but just 10 percent of those participating in the latest survey said the same.
"Those are amazing numbers," said Alan Hummel, senior vice president and chief appraiser for Forsythe Appraisals of St. Paul, Minn. Forsythe was a co-sponsor of the 2006 October Research study.
Hummel said one key reason for the big jump has been the national real estate sales and price slump, and the heightened importance of every signed real estate contract to the parties involved.
"I call it a perfect storm scenario," said Hummel. "You've got a situation where sales are down so everybody in the deal needs it to go through" at the price agreed to by the seller and buyer. When an appraiser comes up with a lower valuation than the contract price -- based on lower comparable sales prices in a depressed marketplace -- the commissions of realty agents and mortgage brokers may be jeopardized.
Some mortgage brokers and lenders, said Hummel, try to avoid such situations by "dialing for values."
"They call up appraisers and say, we've got this sale at $335.000 at such and such an address. Can you get to that number?" The practice is also known as "pre-comping."
Appraisers who say they can hit the number get the assignments. Those who say they can't or fail to respond get nothing. Licensed appraisers must conform to a set of national rules known as "USPAP" (Uniform Standards of Professional Appraisal Practice), which prohibit interference with valuations. Hummel says the vast majority of appraisers are ethical and refuse to give into any form of pressure.
A minority of appraisers, however -- primarily inexperienced and poorly-trained newcomers drawn to the field during the housing boom heydays -- allow themselves to be pressured, and they modify their valuations to meet clients' demands, according to Hummel.
What happens when appraisers decline to play the game? The October Research survey found that 75 percent of appraisers reported "negative ramifications" when they declined requests for inflated valuations. Nearly 70 percent said they lost the client altogether, and 45 percent said they never received payment for the work they did.
Who applies pressure most frequently? The study found that mortgage brokers are by far the worst offenders -- 71 percent of appraisers identified them -- followed by real estate agents at 56 percent. In the 2003 survey, 47 percent of appraisers identified realty agents as pressure sources, and 60 percent identified mortgage brokers.
Hummel said realty agents are able to retaliate against appraisers they deem uncooperative by telling local lenders or mortgage brokers: "Look, I'm not sending any more (home purchaser) clients to you if you continue to use that appraiser."
That represents a huge increase over just the past three years, according to October Research Corp., the principal sponsor of a nationally-representative survey of appraisers. Richfield, Ohio-based October Research, publisher of the trade journal Valuation Review, polled 1,200 appraisers from all 50 states plus the District of Columbia and Puerto Rico in 2003 and 2006.
Forty-five percent of those polled in 2003 said they had "never" been pressured to fudge the numbers on valuations, but just 10 percent of those participating in the latest survey said the same.
"Those are amazing numbers," said Alan Hummel, senior vice president and chief appraiser for Forsythe Appraisals of St. Paul, Minn. Forsythe was a co-sponsor of the 2006 October Research study.
Hummel said one key reason for the big jump has been the national real estate sales and price slump, and the heightened importance of every signed real estate contract to the parties involved.
"I call it a perfect storm scenario," said Hummel. "You've got a situation where sales are down so everybody in the deal needs it to go through" at the price agreed to by the seller and buyer. When an appraiser comes up with a lower valuation than the contract price -- based on lower comparable sales prices in a depressed marketplace -- the commissions of realty agents and mortgage brokers may be jeopardized.
Some mortgage brokers and lenders, said Hummel, try to avoid such situations by "dialing for values."
"They call up appraisers and say, we've got this sale at $335.000 at such and such an address. Can you get to that number?" The practice is also known as "pre-comping."
Appraisers who say they can hit the number get the assignments. Those who say they can't or fail to respond get nothing. Licensed appraisers must conform to a set of national rules known as "USPAP" (Uniform Standards of Professional Appraisal Practice), which prohibit interference with valuations. Hummel says the vast majority of appraisers are ethical and refuse to give into any form of pressure.
A minority of appraisers, however -- primarily inexperienced and poorly-trained newcomers drawn to the field during the housing boom heydays -- allow themselves to be pressured, and they modify their valuations to meet clients' demands, according to Hummel.
What happens when appraisers decline to play the game? The October Research survey found that 75 percent of appraisers reported "negative ramifications" when they declined requests for inflated valuations. Nearly 70 percent said they lost the client altogether, and 45 percent said they never received payment for the work they did.
Who applies pressure most frequently? The study found that mortgage brokers are by far the worst offenders -- 71 percent of appraisers identified them -- followed by real estate agents at 56 percent. In the 2003 survey, 47 percent of appraisers identified realty agents as pressure sources, and 60 percent identified mortgage brokers.
Hummel said realty agents are able to retaliate against appraisers they deem uncooperative by telling local lenders or mortgage brokers: "Look, I'm not sending any more (home purchaser) clients to you if you continue to use that appraiser."
Staging a House
Staging a house goes way beyond your efforts to make it look nifty before having friends over for a dinner party. If you've ever visited a new home development and walked through the builder's model home, you know exactly what staging is. Builders usually do extremely elaborate staging jobs.
Staging finishes the process you started with the three Cs (clean up, clear out, and cosmetic improvements). Here are some staging tips that you can use to increase your house's emotional appeal:
Kitchen:
Aromas from fragrant goodies like freshly baked gingerbread or just-brewed coffee bring back wonderful memories of home. Conversely, many people find odors from pungent foods such as liver, fish, and cabbage to be a turnoff.
Bathrooms:
Always have fresh towels in bathrooms. Buy new shower curtains; old ones are usually mildewy. Put new soap in the soap dishes.
Collections:
Everyone has collections -- family photos on the wall, autographed baseballs, dolls, trophies the kids won in school, whatever. You're not running a museum or a curiosity shop. Put away your collections so people focus on the task at hand -- buying your house.
Clear everything off your refrigerator.
Most folks use magnets or tape to stick everything from vacation snapshots and finger-painting masterpieces to notes for the kids and "to do" lists on the surface of their refrigerator.
Comfort:
Keep your house warm in the winter and cool in the summer. A house that's too hot or too cold isn't inviting.
Fireplace:
Functioning fireplaces are utilitarian (another heat source) and romantic (candlelit dinners by the fire). If you have a fireplace, spotlight it. Polish your fireplace tools. Pile logs neatly in the fireplace. When your house is shown on cold fall or winter days, nothing says "Welcome" like the warmth, glow, crackle, and smell of a blazing fire.
Flowers:
Vases of colorful, fresh flowers spotted throughout the house make a wonderful impression on prospective buyers. You don't have to spend a fortune. Bouquets of carnations, daisies, tulips, or other seasonal flowers from your local supermarket are fine.
Furniture:
Rearrange furniture to create a warm, inviting feeling.
Light:
Bright, well-lit houses seem more spacious and cheerful. During the day, open all your curtains and drapes. If the view is unattractive, get sheer window coverings that let light through, but mask the view. When you show your house, brighten up rooms by turning on all your lamps, even during the day. Be sure hallways and stairways are brightly lit. Don't forget to turn on closet lights, oven lights, and the lights over your stove and kitchen counter.
Prospective buyers often drop in or drive by in the evening to see how your house looks at night. Interior lights that can be seen from the street make a house look cozy and inviting. From sunset until you go to bed, keep at least one light on in each room that faces the street.
Staging finishes the process you started with the three Cs (clean up, clear out, and cosmetic improvements). Here are some staging tips that you can use to increase your house's emotional appeal:
Kitchen:
Aromas from fragrant goodies like freshly baked gingerbread or just-brewed coffee bring back wonderful memories of home. Conversely, many people find odors from pungent foods such as liver, fish, and cabbage to be a turnoff.
Bathrooms:
Always have fresh towels in bathrooms. Buy new shower curtains; old ones are usually mildewy. Put new soap in the soap dishes.
Collections:
Everyone has collections -- family photos on the wall, autographed baseballs, dolls, trophies the kids won in school, whatever. You're not running a museum or a curiosity shop. Put away your collections so people focus on the task at hand -- buying your house.
Clear everything off your refrigerator.
Most folks use magnets or tape to stick everything from vacation snapshots and finger-painting masterpieces to notes for the kids and "to do" lists on the surface of their refrigerator.
Comfort:
Keep your house warm in the winter and cool in the summer. A house that's too hot or too cold isn't inviting.
Fireplace:
Functioning fireplaces are utilitarian (another heat source) and romantic (candlelit dinners by the fire). If you have a fireplace, spotlight it. Polish your fireplace tools. Pile logs neatly in the fireplace. When your house is shown on cold fall or winter days, nothing says "Welcome" like the warmth, glow, crackle, and smell of a blazing fire.
Flowers:
Vases of colorful, fresh flowers spotted throughout the house make a wonderful impression on prospective buyers. You don't have to spend a fortune. Bouquets of carnations, daisies, tulips, or other seasonal flowers from your local supermarket are fine.
Furniture:
Rearrange furniture to create a warm, inviting feeling.
Light:
Bright, well-lit houses seem more spacious and cheerful. During the day, open all your curtains and drapes. If the view is unattractive, get sheer window coverings that let light through, but mask the view. When you show your house, brighten up rooms by turning on all your lamps, even during the day. Be sure hallways and stairways are brightly lit. Don't forget to turn on closet lights, oven lights, and the lights over your stove and kitchen counter.
Prospective buyers often drop in or drive by in the evening to see how your house looks at night. Interior lights that can be seen from the street make a house look cozy and inviting. From sunset until you go to bed, keep at least one light on in each room that faces the street.
Reasons to Sell
Our goal is to help you make the right decision about whether or not to sell your house. If you do decide to sell, we want to make sure that you get as many dollars and as few upset stomachs from the sale as possible.
People's reasons for wanting to sell their houses are almost as varied as the houses themselves. Here are some of the common, not-so common, and downright bizarre reasons that have prompted sellers we've known over the years to put their houses on the market:
School district
Neighborhood
Better job opportunities elsewhere
Recent marriage or divorce
Recent death of spouse
Additional debt burden due to layoff, medical expenses, disability, or overspending
Serious house defects that they don't want to fix
Increased space desires for expanding family
Diminished space requirements now that kids are grown
Noisy neighborhood
Unfriendly neighbors
Neighborhood shopping
Climate
People's reasons for wanting to sell their houses are almost as varied as the houses themselves. Here are some of the common, not-so common, and downright bizarre reasons that have prompted sellers we've known over the years to put their houses on the market:
School district
Neighborhood
Better job opportunities elsewhere
Recent marriage or divorce
Recent death of spouse
Additional debt burden due to layoff, medical expenses, disability, or overspending
Serious house defects that they don't want to fix
Increased space desires for expanding family
Diminished space requirements now that kids are grown
Noisy neighborhood
Unfriendly neighbors
Neighborhood shopping
Climate
Getting into Real Estate for the Long Haul
They represent the future of real estate in this time of uncertainty -- 17 bright-eyed and eager students, median age 40, sitting for three hours in a classroom while I click slowly through a 50-slide Power Point presentation with embedded video and audio.
These are small investors, a mixed group of young and old, Realtors and nonRealtors, and all ethnicities -- a true mix of the modern-day urban market.
They want to know what I can tell them about renovating one-to-four unit properties cost-effectively, whether or not to hire an architect, what to look for in a contractor, what will put their rentals a cut above the others without breaking their budgets.
These are not flippers. These folks are in for the long haul, agreeing with some expert who told me this week that this isn't the time to experiment with real estate but to get serious about it.
One of the experts whose video was embedded in the Power Point was Carl Dranoff, a developer who was one of the pioneers of the warehouse to loft conversion boom on the late '70s to mid-'80s in many of our older cities.
When interest rates were hovering at 18 percent and creative financing was in its infancy, Dranoff turned his attention to the rental market, and that what these former factories and warehouses became. He attracted the same kinds of renters who are buying urban condos these days -- young single or recently married professionals and a few brave empty nesters willing to live on the then-mean streets of the city.
Although he focused on big projects, a lot of what Dranoff recommends can be tailored to smaller projects. On the top of his is location: Look at emerging neighborhoods that are not yet at the forefront of development. Look at smaller projects in areas where large ones are changing the equation.
Don't expect to find bargains at the intersection of major city streets.
Look for buildings with good bones: High ceilings, big windows, wide-spaced columns. For residential use, the shape of a building is important, since light can only penetrate a space up to 20 feet.
The larger the windows, the bigger the ceiling height, the more opportunity for being "sun-splashed."
Look for character-defining features, such as brick walls that can be restored.
Columns are another character-defining feature. Columns were used in lieu of beams, with the load carried by the flair-out at the top of the column.
The problem with columns is that they are often in the wrong place, so you have to adjust the spatial layout to accommodate them.
Remember: Because you are trying to accommodate architectural features with living space, "you can't make every apartment perfect," Dranoff said.
Lay out each room of an apartment with furniture; otherwise, you end up without door-swing clearance or with a piece of furniture without enough walk-by clearance.
Expect to install brand new systems: Plumbing, heating, ventilation and air conditioning. Even technology has to be introduced -- high-speed Internet access or fiber-optic cable -- especially for those investors whose buildings will house a younger market -- especially grad students and dot.com professionals.
Dranoff is a proponent of the "gut rehab," or starting a renovation with a blank slate. That means, removing the interior down to the frame and starting over.
That way it's easy to start installing heating, cooling, ventilation, and plumbing systems.
You need to pay attention to ductwork, since it is often difficult to penetrate obstacles such as concrete walls with a duct.
That's why you need a mechanical engineer to design the system, and have that person handle obtaining the permits and the equipment suppliers needed for the work.
To the neophyte investors, Dranoff recommends starting small.
Buy a small building. Surround yourself with good people: a lawyer, architect, plumber, electrician, and more who can be depended upon for advice and to show up when needed.
Know your market: Who is the end user? If you renovate to sell, make sure you have a good real estate firm. If you renovate to rent, have a good leasing agent.
Always allow more time for your project. If you believe it will take four months, make it six, because you never know what you'll find behind the walls.
And, for the same reason, add 10 percent to your budget.
Finally, be very wary of buildings with problems. Environmental issues can make a renovation project less than cost-effective, he said.
These are small investors, a mixed group of young and old, Realtors and nonRealtors, and all ethnicities -- a true mix of the modern-day urban market.
They want to know what I can tell them about renovating one-to-four unit properties cost-effectively, whether or not to hire an architect, what to look for in a contractor, what will put their rentals a cut above the others without breaking their budgets.
These are not flippers. These folks are in for the long haul, agreeing with some expert who told me this week that this isn't the time to experiment with real estate but to get serious about it.
One of the experts whose video was embedded in the Power Point was Carl Dranoff, a developer who was one of the pioneers of the warehouse to loft conversion boom on the late '70s to mid-'80s in many of our older cities.
When interest rates were hovering at 18 percent and creative financing was in its infancy, Dranoff turned his attention to the rental market, and that what these former factories and warehouses became. He attracted the same kinds of renters who are buying urban condos these days -- young single or recently married professionals and a few brave empty nesters willing to live on the then-mean streets of the city.
Although he focused on big projects, a lot of what Dranoff recommends can be tailored to smaller projects. On the top of his is location: Look at emerging neighborhoods that are not yet at the forefront of development. Look at smaller projects in areas where large ones are changing the equation.
Don't expect to find bargains at the intersection of major city streets.
Look for buildings with good bones: High ceilings, big windows, wide-spaced columns. For residential use, the shape of a building is important, since light can only penetrate a space up to 20 feet.
The larger the windows, the bigger the ceiling height, the more opportunity for being "sun-splashed."
Look for character-defining features, such as brick walls that can be restored.
Columns are another character-defining feature. Columns were used in lieu of beams, with the load carried by the flair-out at the top of the column.
The problem with columns is that they are often in the wrong place, so you have to adjust the spatial layout to accommodate them.
Remember: Because you are trying to accommodate architectural features with living space, "you can't make every apartment perfect," Dranoff said.
Lay out each room of an apartment with furniture; otherwise, you end up without door-swing clearance or with a piece of furniture without enough walk-by clearance.
Expect to install brand new systems: Plumbing, heating, ventilation and air conditioning. Even technology has to be introduced -- high-speed Internet access or fiber-optic cable -- especially for those investors whose buildings will house a younger market -- especially grad students and dot.com professionals.
Dranoff is a proponent of the "gut rehab," or starting a renovation with a blank slate. That means, removing the interior down to the frame and starting over.
That way it's easy to start installing heating, cooling, ventilation, and plumbing systems.
You need to pay attention to ductwork, since it is often difficult to penetrate obstacles such as concrete walls with a duct.
That's why you need a mechanical engineer to design the system, and have that person handle obtaining the permits and the equipment suppliers needed for the work.
To the neophyte investors, Dranoff recommends starting small.
Buy a small building. Surround yourself with good people: a lawyer, architect, plumber, electrician, and more who can be depended upon for advice and to show up when needed.
Know your market: Who is the end user? If you renovate to sell, make sure you have a good real estate firm. If you renovate to rent, have a good leasing agent.
Always allow more time for your project. If you believe it will take four months, make it six, because you never know what you'll find behind the walls.
And, for the same reason, add 10 percent to your budget.
Finally, be very wary of buildings with problems. Environmental issues can make a renovation project less than cost-effective, he said.
National Sales Figures Say It's A Buyer's Market
According to the National Association of Realtors, home prices are nearly flat and housing inventories nationwide have gone above the benchmark six-month supply.
When there is more than six months supply of homes, the market is said to be a buyer's market. Inventories of less than six month's supply are said to be seller's market. A buyer's market favors the buyer in negotiating the sales price and terms with the seller.
June sales were 8.9 percent below last year's pace.
David Lereah, NAR's chief economist, said the housing market is flattening-out. "Over the last three months home sales have held in a narrow range, easing to a level that is near our annual projection, which tells us the market is stabilizing," he said. "At the same time, sellers have recognized that they need to be more competitive in their pricing given the rise in housing inventories. Home prices are only a little higher than a year ago."
The national median existing-home price for all housing types was $231,000 in June, up 0.9 percent from June 2005 when the median was $229,000. The median is a typical market price where half of the homes sold for more and half sold for less.
"The change in price performance is directly tied to housing inventories -- a year ago we had a lean supply of homes and a sellers' market, with monthly home sales at an all-time record high," Lereah said.
Total housing inventory levels rose 3.8 percent at the end of June to 3.73 million existing homes available for sale, which represents a 6.8-month supply at the current sales pace. By contrast, in June 2005, there was a tight 4.4-month supply on the market.
In key markets such as California, where one out of nine homeowners lives, the market is still showing some appreciation, but far from the double digit returns of last year. According to the California Association of Realtors' chief economist, Leslie Appleton-Young, the median price of an existing home in California increased 6.2 percent in June and sales decreased 26.3 percent compared with the same period a year ago.
"Mortgage interest rates continued to edge up for the fifth consecutive month in June, contributing in part to a slowdown in sales," said Appleton-Young. "June 2006 was the first time since late 2001 that the sales pace fell below 500,000 for two consecutive months. Home sales declined 26.3 percent last month compared with June 2005, when they hit the third-highest monthly pace on record."
That puts California's unsold inventory for existing single-family detached homes at a 6.2 month supply, compared with 2.5 months (revised) for the same period a year ago.
High prices haven't been the only factor to cool the housing market. Mortgage interest rates have also risen over a point from June 2005 to June 2006, further depressing affordability for homebuyers.
The good news is for homebuyers, says NAR President Thomas M. Stevens. "People who were discouraged by the bidding wars that were so common over the last few years are finding more choices now," said Stevens, senior vice president of NRT Inc. "Relative to the five-year housing boom, this year is a buyer's market in much of the country with plentiful supply, along with interest rates which remain historically favorable, so it's a good time to buy a home."
When there is more than six months supply of homes, the market is said to be a buyer's market. Inventories of less than six month's supply are said to be seller's market. A buyer's market favors the buyer in negotiating the sales price and terms with the seller.
June sales were 8.9 percent below last year's pace.
David Lereah, NAR's chief economist, said the housing market is flattening-out. "Over the last three months home sales have held in a narrow range, easing to a level that is near our annual projection, which tells us the market is stabilizing," he said. "At the same time, sellers have recognized that they need to be more competitive in their pricing given the rise in housing inventories. Home prices are only a little higher than a year ago."
The national median existing-home price for all housing types was $231,000 in June, up 0.9 percent from June 2005 when the median was $229,000. The median is a typical market price where half of the homes sold for more and half sold for less.
"The change in price performance is directly tied to housing inventories -- a year ago we had a lean supply of homes and a sellers' market, with monthly home sales at an all-time record high," Lereah said.
Total housing inventory levels rose 3.8 percent at the end of June to 3.73 million existing homes available for sale, which represents a 6.8-month supply at the current sales pace. By contrast, in June 2005, there was a tight 4.4-month supply on the market.
In key markets such as California, where one out of nine homeowners lives, the market is still showing some appreciation, but far from the double digit returns of last year. According to the California Association of Realtors' chief economist, Leslie Appleton-Young, the median price of an existing home in California increased 6.2 percent in June and sales decreased 26.3 percent compared with the same period a year ago.
"Mortgage interest rates continued to edge up for the fifth consecutive month in June, contributing in part to a slowdown in sales," said Appleton-Young. "June 2006 was the first time since late 2001 that the sales pace fell below 500,000 for two consecutive months. Home sales declined 26.3 percent last month compared with June 2005, when they hit the third-highest monthly pace on record."
That puts California's unsold inventory for existing single-family detached homes at a 6.2 month supply, compared with 2.5 months (revised) for the same period a year ago.
High prices haven't been the only factor to cool the housing market. Mortgage interest rates have also risen over a point from June 2005 to June 2006, further depressing affordability for homebuyers.
The good news is for homebuyers, says NAR President Thomas M. Stevens. "People who were discouraged by the bidding wars that were so common over the last few years are finding more choices now," said Stevens, senior vice president of NRT Inc. "Relative to the five-year housing boom, this year is a buyer's market in much of the country with plentiful supply, along with interest rates which remain historically favorable, so it's a good time to buy a home."
How to Tell Where Your Market's Headed
I've had several friends come up to me in the last few weeks and ask: "Is this a good time to sell my house?" or "Is this a good time to buy a house?" Let me preface my 700-word answer with this: If nobody panics, we'll all get out of this alive.
Many readers have accused me of being too optimistic on the real estate market. What they see as optimistic is actually an attitude steeped in the belief that you can make money in real estate in any market, you just have to know how to operate when the market's moving up, leveling off, or cooling down.
When prices are up -- sell. When prices are leveling or dropping -- buy (or sell). When rents are moving up, don't play Mr. Charity, raise your rents. When you enter this field of real estate as a wealth-building business investment, that's exactly how you have to treat it -- like a business.
When the market shifts, that's okay if you're looking at the market as a way of making money and building wealth. So last week when I read some reports from federal agencies that appreciation had slowed, I didn't panic with many of the market prognosticators, I just shifted my business plan. Real estate investors and property owners can make money in any market, you just have to be wise on the market and be flexible on how much profit you want to make.
Consumers are definitely confused on whether they should buy a piece of property when many numbers are pointing at a housing market that is slipping in prices. Today's tip is to approach it from a non-emotional business perspective. Watch these segments of the economy in your local area to determine if you should buy in your market:
A - The local economy
What's happening? Are jobs growing? Are businesses opening? Are current businesses investing in themselves? What are the economists saying in your area? Research this data by a simple Google or Yahoo search of " economic report." Through that search, the astute investor will find out where economists are predicting growth in suburban business centers and where the jobs are coming and going.
Forget what you're hearing nationally and look for the growth on the local level -- where you want to buy a house. Just like politics, real estate is local, which moves us to B.
B - The local real estate market
What's happening? Are prices booming, leveling or slipping? This has to be researched on various levels. Start on the state level, drill it down to your county and then get a granular look at the zip code and community level.
These numbers can easily be found through your local Realtor association. For a list from across the country, start at Realtor.com and click the links to local real estate associations at the bottom of the page. Most local associations (definitely state groups) keep a public area on their web pages with local statistics on the number of homes sold, sales prices and year-to-year appreciation.
Look up government information as well on job growth, economic plans and forecasts. If the state and county governments are playing their role appropriately, they're creating jobs AND allowing development of housing to house the workers who come along for those jobs.
If they haven't come up with the latter, then you might have a good investment opportunity on your hands. More jobs and fewer houses spell lower supply and high demand, meaning equity growth and high rents.
And don't forget the rental market. Is it growing? Are there a lot of vacancies? How much are the rents going up? Down? If rents are up, then you may be able to cover your monthly expenses. If they're dropping, it could be because the location is down economically or because housing is so affordable (but appreciating) that renters are getting out of the rent track and buying a house instead.
C - The financial market
This market is actually the only real estate component that is usually measured on a national basis. It's all about the cost of money and most interest rates are within a basis point or two from each other nationwide. Currently, they are still historically low (under 7 percent) which can be had for 1 or less points.
If you find that A is chugging along, B is still affordable and C is also affordable -- then buy, buy, buy. A strong economy with a growing real estate market and strong rates, means you can buy a house for relatively little money down as an investor, put a renter in the house and obtain it with cheap money that the rent will pay for.
If you find you're in a positive A situation, but B is unaffordable and C is still affordable, then you may need to wait or jump in the flow before B gets even more unaffordable.
If A is great, B is leveling and C is still affordable, and A looks like it's going to keep growing -- then buy while you can, because B is going to move up right after the break.
Finally, get a team together to help you analyze the data you've just researched. Are the prices trending upward? (And is that really a good thing right now?) Or are the prices dipping, meaning I should get in while I can because the jobs are coming? Work with your agent, lender and accountant to figure how the market can help you with your wealth-building goals.
Many readers have accused me of being too optimistic on the real estate market. What they see as optimistic is actually an attitude steeped in the belief that you can make money in real estate in any market, you just have to know how to operate when the market's moving up, leveling off, or cooling down.
When prices are up -- sell. When prices are leveling or dropping -- buy (or sell). When rents are moving up, don't play Mr. Charity, raise your rents. When you enter this field of real estate as a wealth-building business investment, that's exactly how you have to treat it -- like a business.
When the market shifts, that's okay if you're looking at the market as a way of making money and building wealth. So last week when I read some reports from federal agencies that appreciation had slowed, I didn't panic with many of the market prognosticators, I just shifted my business plan. Real estate investors and property owners can make money in any market, you just have to be wise on the market and be flexible on how much profit you want to make.
Consumers are definitely confused on whether they should buy a piece of property when many numbers are pointing at a housing market that is slipping in prices. Today's tip is to approach it from a non-emotional business perspective. Watch these segments of the economy in your local area to determine if you should buy in your market:
A - The local economy
What's happening? Are jobs growing? Are businesses opening? Are current businesses investing in themselves? What are the economists saying in your area? Research this data by a simple Google or Yahoo search of " economic report." Through that search, the astute investor will find out where economists are predicting growth in suburban business centers and where the jobs are coming and going.
Forget what you're hearing nationally and look for the growth on the local level -- where you want to buy a house. Just like politics, real estate is local, which moves us to B.
B - The local real estate market
What's happening? Are prices booming, leveling or slipping? This has to be researched on various levels. Start on the state level, drill it down to your county and then get a granular look at the zip code and community level.
These numbers can easily be found through your local Realtor association. For a list from across the country, start at Realtor.com and click the links to local real estate associations at the bottom of the page. Most local associations (definitely state groups) keep a public area on their web pages with local statistics on the number of homes sold, sales prices and year-to-year appreciation.
Look up government information as well on job growth, economic plans and forecasts. If the state and county governments are playing their role appropriately, they're creating jobs AND allowing development of housing to house the workers who come along for those jobs.
If they haven't come up with the latter, then you might have a good investment opportunity on your hands. More jobs and fewer houses spell lower supply and high demand, meaning equity growth and high rents.
And don't forget the rental market. Is it growing? Are there a lot of vacancies? How much are the rents going up? Down? If rents are up, then you may be able to cover your monthly expenses. If they're dropping, it could be because the location is down economically or because housing is so affordable (but appreciating) that renters are getting out of the rent track and buying a house instead.
C - The financial market
This market is actually the only real estate component that is usually measured on a national basis. It's all about the cost of money and most interest rates are within a basis point or two from each other nationwide. Currently, they are still historically low (under 7 percent) which can be had for 1 or less points.
If you find that A is chugging along, B is still affordable and C is also affordable -- then buy, buy, buy. A strong economy with a growing real estate market and strong rates, means you can buy a house for relatively little money down as an investor, put a renter in the house and obtain it with cheap money that the rent will pay for.
If you find you're in a positive A situation, but B is unaffordable and C is still affordable, then you may need to wait or jump in the flow before B gets even more unaffordable.
If A is great, B is leveling and C is still affordable, and A looks like it's going to keep growing -- then buy while you can, because B is going to move up right after the break.
Finally, get a team together to help you analyze the data you've just researched. Are the prices trending upward? (And is that really a good thing right now?) Or are the prices dipping, meaning I should get in while I can because the jobs are coming? Work with your agent, lender and accountant to figure how the market can help you with your wealth-building goals.
For Some, It's Time To Appeal Property Tax Bills
Pay close attention to your next property tax bill.
Your home may be worth less than the local tax assessor or taxing agency believes and that could mean a smaller property tax bill.
However, unless the assessor takes it upon himself or herself to perform a wholesale property tax reduction for all properties -- rare, but possible -- it's up to you to appeal your tax bill.
"An overvalued, over assessed property is one of the most common and successful grounds for challenging your tax bill," says Eric Cunliffe, a senior vice president with RealEstate.com.
Generally, when home prices rise, so do property taxes which are tied to a home's value. Conversely, when home values fall, so do those same property taxes.
The problem is, many taxing agencies simply wait until the property is sold or the home owner performs a major value enhancing alteration before reassessing the property.
In the current market, however, the increased incidence of foreclosures would indicate, in some cases, there's not enough value in some properties to cover the mortgage. Some owners, wisely or not, are allowing their homes to go back to the bank.
The housing boom frenzy caused many buyers to bid up the price of the property and artificially inflate the value. In some markets, sellers who purchased homes at the height of the boom and must now sell, are finding they have to price their home to move. That means a price, and possibly, value reduction.
The National Taxpayers Union (NTU) says as many as 60 percent of all homes are over-assessed and not in line with their actual value.
Many errors are clerical mistakes according to the American Homeowners Association (AHA).
The vast majority of homeowners who find errors and contest their bill enjoy a lower property tax, says the AHA, which offers a quiz that points to signals your home could be over assessed.
Tell-tale signs include:
Errors in the description of your property on the tax bill.
Compatible homes in the area that have sold for less than your appraised value.
Neighbors with lower assessments on similar houses. (Keep in mind some homes retain the same assessed value for years and assessed values often don't rise in step with market values or home sale prices.)
Value reducers in your home or area, including drainage problems, easements, re-zoning, heavy traffic, nearby railroad tracks, freeways, industry or toxic waste.
Depreciation factors, including the quality of materials, inefficient heating, structural cracks, deterioration, or chronic defects.
The AHA, NTU and others offer property tax reduction kits for a fee and while they may be useful tools to help walk you through the process, appealing your property tax is a right you typically can exercise for free.
Beware of official-looking mailings and email come-ons due out any day now offering to do the work for you -- for a fee. Some are scams designed to appeal to nothing more than your sense of dread at going it alone. They want only your money, but not to appeal your property tax assessment.
The Federation of Tax Administrators can point you to your property tax assessor or administrator where you can get all the details you need for appealing your property tax.
Cunliffe says, "The first thing you should do is examine your tax records in the local assessor's office to make sure the information is complete and accurate. To do this, ask yourself the following questions:"
Did you buy your home in a bidding war? An overvalued property is an over assessed property.
Are there errors in your tax records? Look closely at your records and make sure there aren't reporting errors. A condo listed as a single-family home, an incorrect age, square footage that's off, too many rooms and other descriptive factors could falsely boost assessed value.
Do the math. Many states put a cap on how much above the market value an assessment can be and how much it can rise each year.
To appeal the assessed value and related property tax, prepare yourself for a tough process that could require you to appeal an initial rejection.
Also pay close attention to your local rules' period of time when you must complete the complete appeals process.
Cunliffe says, while the process is free if you go it alone, you may need the help of a real estate agent, realty attorney or other licensed professional to assist you gathering some of the information you'll need to make your case.
You'll have to look at comparable homes in your community to determine how much the owners are paying for property taxes. The information is largely public and available from your tax assessor's office.
Cunliffe says you'll typically have to find at least three other comparable homes in your neighborhood that have lower assessments. Obviously, the lower, the better.
A real estate agent or other professional who has access to the multiple listing service can do a comparable market analysis of homes recently sold and in escrow to hone in on your home's true value.
An appraiser with multiple listing service access can do the same, as well as perform an appraisal of your home.
In either case, you could be out a few hundred dollars. Don't make a case if you don't think it's worth the cost to appeal.
The AARP also says some states have programs for property tax deferrals and other programs that let certain home owners postpone payment of some or all property taxes. There are also some tax rebates and exemptions.
Don't forget, property taxes are also one of many home ownership related expenses that qualify for a deduction on your income tax returns. The smaller the tax, the smaller the deduction.
Your home may be worth less than the local tax assessor or taxing agency believes and that could mean a smaller property tax bill.
However, unless the assessor takes it upon himself or herself to perform a wholesale property tax reduction for all properties -- rare, but possible -- it's up to you to appeal your tax bill.
"An overvalued, over assessed property is one of the most common and successful grounds for challenging your tax bill," says Eric Cunliffe, a senior vice president with RealEstate.com.
Generally, when home prices rise, so do property taxes which are tied to a home's value. Conversely, when home values fall, so do those same property taxes.
The problem is, many taxing agencies simply wait until the property is sold or the home owner performs a major value enhancing alteration before reassessing the property.
In the current market, however, the increased incidence of foreclosures would indicate, in some cases, there's not enough value in some properties to cover the mortgage. Some owners, wisely or not, are allowing their homes to go back to the bank.
The housing boom frenzy caused many buyers to bid up the price of the property and artificially inflate the value. In some markets, sellers who purchased homes at the height of the boom and must now sell, are finding they have to price their home to move. That means a price, and possibly, value reduction.
The National Taxpayers Union (NTU) says as many as 60 percent of all homes are over-assessed and not in line with their actual value.
Many errors are clerical mistakes according to the American Homeowners Association (AHA).
The vast majority of homeowners who find errors and contest their bill enjoy a lower property tax, says the AHA, which offers a quiz that points to signals your home could be over assessed.
Tell-tale signs include:
Errors in the description of your property on the tax bill.
Compatible homes in the area that have sold for less than your appraised value.
Neighbors with lower assessments on similar houses. (Keep in mind some homes retain the same assessed value for years and assessed values often don't rise in step with market values or home sale prices.)
Value reducers in your home or area, including drainage problems, easements, re-zoning, heavy traffic, nearby railroad tracks, freeways, industry or toxic waste.
Depreciation factors, including the quality of materials, inefficient heating, structural cracks, deterioration, or chronic defects.
The AHA, NTU and others offer property tax reduction kits for a fee and while they may be useful tools to help walk you through the process, appealing your property tax is a right you typically can exercise for free.
Beware of official-looking mailings and email come-ons due out any day now offering to do the work for you -- for a fee. Some are scams designed to appeal to nothing more than your sense of dread at going it alone. They want only your money, but not to appeal your property tax assessment.
The Federation of Tax Administrators can point you to your property tax assessor or administrator where you can get all the details you need for appealing your property tax.
Cunliffe says, "The first thing you should do is examine your tax records in the local assessor's office to make sure the information is complete and accurate. To do this, ask yourself the following questions:"
Did you buy your home in a bidding war? An overvalued property is an over assessed property.
Are there errors in your tax records? Look closely at your records and make sure there aren't reporting errors. A condo listed as a single-family home, an incorrect age, square footage that's off, too many rooms and other descriptive factors could falsely boost assessed value.
Do the math. Many states put a cap on how much above the market value an assessment can be and how much it can rise each year.
To appeal the assessed value and related property tax, prepare yourself for a tough process that could require you to appeal an initial rejection.
Also pay close attention to your local rules' period of time when you must complete the complete appeals process.
Cunliffe says, while the process is free if you go it alone, you may need the help of a real estate agent, realty attorney or other licensed professional to assist you gathering some of the information you'll need to make your case.
You'll have to look at comparable homes in your community to determine how much the owners are paying for property taxes. The information is largely public and available from your tax assessor's office.
Cunliffe says you'll typically have to find at least three other comparable homes in your neighborhood that have lower assessments. Obviously, the lower, the better.
A real estate agent or other professional who has access to the multiple listing service can do a comparable market analysis of homes recently sold and in escrow to hone in on your home's true value.
An appraiser with multiple listing service access can do the same, as well as perform an appraisal of your home.
In either case, you could be out a few hundred dollars. Don't make a case if you don't think it's worth the cost to appeal.
The AARP also says some states have programs for property tax deferrals and other programs that let certain home owners postpone payment of some or all property taxes. There are also some tax rebates and exemptions.
Don't forget, property taxes are also one of many home ownership related expenses that qualify for a deduction on your income tax returns. The smaller the tax, the smaller the deduction.
Increase the Odds of Selling Your Home by Cleaning Out Clutter
Increase the Odds of Selling Your Home by Cleaning Out Clutter
Whether you're getting ready to put your home on the market or you simply want to get a fresh start in 2007 -- clearing clutter is the answer.
Your REALTOR® will tell you when they show buyers a cluttered home, no matter how lovely it could be, prospective buyers just can't picture it and will usually pass or make an offer for much less than the seller thinks the home is worth. Yes, packaging matters. It matters when you're buying a product in a store and it matters when you're selling your home.
Think about the way model homes are packaged for display. There's so little in them; yet they look just perfectly appealing. Of course, that's not how any of us really live. But it's how consumers want to see the home. The fact is, maybe we could live with a little less -- at least while our home is on the market. After all, much of the clutter ends up collecting dust! And since you are moving, packing up some of your belongings before you actually move out (or even getting a tax credit for donating items to a charity) will help you when you finally sell your home and are ready to move.
Even if you're not in the market to sell, clearing clutter will give you a sense of freedom (and the ability to eventually accumulate more). Since the holidays just passed, you probably are already bombarded with stuff and maybe even wondering where to put it all.
The problem is many of us have a hard time letting go of things. So clutter builds up fast and furious and undoing the clutter becomes a frustrating task. But it doesn't have to be. Here are some tips on de-cluttering. Wouldn't it be nice to have a home that when you stepped inside you felt a sense of spaciousness -- everything seemed to have a place rather than items jammed into every last inch of the room? Cabinets and closets closed properly -- not like when you've gone on a three-week vacation to Italy and now you have to sit atop your luggage and tug roughly on the zipper to get it closed.
De-cluttering is a project that once you take the time to unload a few items, you often find they're never missed. And consider this, studies have shown that people waste several weeks a year looking for misplaced items that are buried beneath clutter. So let's get started.
First, don't de-clutter by making more room for clutter. As crazy as this is, true pack rats merely move their clutter from one location to another throughout the year without ever throwing anything out. When one area is too cluttered, they add shelves or even room additions to house their clutter.
Start with non-emotional items and rooms. You're less likely to have trouble throwing out things if you don't have an emotional attachment to them. Do you really need 12 different measuring cups? But here's a tip, I don't recommend throwing out your spouse's trinket collection (no matter how tempted you are) without first consulting him/her. Otherwise, you might end up listing your home by divorce default! Instead, start with your own stuff and lead by example.
Next go to the bathroom cabinets. Get rid of old prescriptions and products that you rarely use.
Clean out the clutter from under the bed. There are likely items that you haven't used in years underneath the bed just collecting dust. Nothing's worse than viewing a home and the buyer lifts a corner of the bed's dust ruffle to reveal a mixture of clutter, dust, and pet hair -- yuck!
Walk-in-closets are so named because you should be able to move about in them. But some people have them overflowing. Buyers can't even squeeze inside, nor would they want to in that condition. So, the desirable walk-in-closet now becomes a negative for the buyer. Chances are there are clothes in your closet that haven't been worn in a long time.
Clearing clutter not only makes your home appealing to others, it's a richly satisfying feeling to create a sense of organization and space. And just think what you could do if you didn't have to spend weeks looking beneath clutter to find something you've misplaced.
Whether you're getting ready to put your home on the market or you simply want to get a fresh start in 2007 -- clearing clutter is the answer.
Your REALTOR® will tell you when they show buyers a cluttered home, no matter how lovely it could be, prospective buyers just can't picture it and will usually pass or make an offer for much less than the seller thinks the home is worth. Yes, packaging matters. It matters when you're buying a product in a store and it matters when you're selling your home.
Think about the way model homes are packaged for display. There's so little in them; yet they look just perfectly appealing. Of course, that's not how any of us really live. But it's how consumers want to see the home. The fact is, maybe we could live with a little less -- at least while our home is on the market. After all, much of the clutter ends up collecting dust! And since you are moving, packing up some of your belongings before you actually move out (or even getting a tax credit for donating items to a charity) will help you when you finally sell your home and are ready to move.
Even if you're not in the market to sell, clearing clutter will give you a sense of freedom (and the ability to eventually accumulate more). Since the holidays just passed, you probably are already bombarded with stuff and maybe even wondering where to put it all.
The problem is many of us have a hard time letting go of things. So clutter builds up fast and furious and undoing the clutter becomes a frustrating task. But it doesn't have to be. Here are some tips on de-cluttering. Wouldn't it be nice to have a home that when you stepped inside you felt a sense of spaciousness -- everything seemed to have a place rather than items jammed into every last inch of the room? Cabinets and closets closed properly -- not like when you've gone on a three-week vacation to Italy and now you have to sit atop your luggage and tug roughly on the zipper to get it closed.
De-cluttering is a project that once you take the time to unload a few items, you often find they're never missed. And consider this, studies have shown that people waste several weeks a year looking for misplaced items that are buried beneath clutter. So let's get started.
First, don't de-clutter by making more room for clutter. As crazy as this is, true pack rats merely move their clutter from one location to another throughout the year without ever throwing anything out. When one area is too cluttered, they add shelves or even room additions to house their clutter.
Start with non-emotional items and rooms. You're less likely to have trouble throwing out things if you don't have an emotional attachment to them. Do you really need 12 different measuring cups? But here's a tip, I don't recommend throwing out your spouse's trinket collection (no matter how tempted you are) without first consulting him/her. Otherwise, you might end up listing your home by divorce default! Instead, start with your own stuff and lead by example.
Next go to the bathroom cabinets. Get rid of old prescriptions and products that you rarely use.
Clean out the clutter from under the bed. There are likely items that you haven't used in years underneath the bed just collecting dust. Nothing's worse than viewing a home and the buyer lifts a corner of the bed's dust ruffle to reveal a mixture of clutter, dust, and pet hair -- yuck!
Walk-in-closets are so named because you should be able to move about in them. But some people have them overflowing. Buyers can't even squeeze inside, nor would they want to in that condition. So, the desirable walk-in-closet now becomes a negative for the buyer. Chances are there are clothes in your closet that haven't been worn in a long time.
Clearing clutter not only makes your home appealing to others, it's a richly satisfying feeling to create a sense of organization and space. And just think what you could do if you didn't have to spend weeks looking beneath clutter to find something you've misplaced.
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