Archive for the 'For Buyers' Category
The Westchester real estate market is now truly a buyer’s market. In most communities, the number of westchester ny homes for sale is in excess of six months inventory. This is not universal throughout the county. But for the most part, the county is in a buyer’s market. A few days ago, I wrote a blog about seller’s stuck on unrealistic prices (Dear Seller, About that number in your head…) But this is one of those markets where unrealistic expectations are not limited to one side of the transaction. Fueled in part by media reports filled with sturm und drang (storm and stress) many buyers have confused a buyer’s market with a fire sale.
Unfortunately, unrealistic expectations can set buyers up for unnecessary disappointment and frustration. There are several flavors of unrealistic buyers out there.
The “I want to steal a house” investor:
This buyer is determined to find a home for pennies on the dollar. They comb through listing after listing and call agent after agent to show them home after home that looks as though it is the bargain of the century. The trouble is that once they see the home, they realize that this is beyond the simple fixer-upper. A new coat of paint is not going to do the trick. These homes don’t just need TLC – they need to be gutted.
This type of buyer needs to realize that there is no free ride here. Many of them have been watching too many late-night TV shows that claim that banks want to get rid of these properties at “any price.” After the way the banks have behaved over the past year – does anyone seriously think they are going to get the better end of any deal involving a bank? Banks have shown themselves to be more than capable of looking after their own interests.
The “I’ve got champaign taste and a beer budget -but I’m not settling” buyer:
This buyer can appear in any market. Since affordability has improved, it might seem counterintuitive to observe an increase in this type of buyer right now. Yet, that’s what I’m seeing. They want far more than they can ever possibly afford and the buyer’s market media hype is giving them tacit permission to push for the impossible. The sad thing is that this buyer is not looking at the increased affordability of the past year as the gift that it is – instead they are on a quest for even more.
This type of buyer has two choices: bite the bullet and buy what they can truly afford or roll the dice and hope that affordability increases still further. The latter has true risks in this market. Although prices may decline further, affordability is probably not going to increase because interest rates are almost certainly headed northward. This may well more than offset any further price decreases. For affordability to increase the buyer has to look to their own finances not the marketplace in order to afford “more.”
The buyer who will only put in offers 10-20% below asking price no matter what the comps say:
This type of buyer is of the mindset that “if you don’t ask, you don’t get.” They want to “test” the seller with a lowball in the hopes that the seller is desperate enough or ignorant enough of the comparable solds to accept. As I said in my previous blog about sellers: asking isn’t getting.
Not only does this rarely work, but it can really offend the seller to the point where the buyer could lose the sale. Low-balling is not a good way to win friends – or negotiate a sale. Offers should be based on the comparable sales – NOT the asking price. Many seller’s have already priced their homes realistically. A realistically priced home is more likely to be having multiple offers – so low-balling is a bad idea.
At the end of the day, buyers need to take a realistic look at the comparable sales. Those numbers are not lying and placing realistic offers in that “sweet spot” where they are consistent with recent sales – leads to success in the long haul.
In the end, the sale and purchase of a home should be a win-win for all concerned. It’s not about “beating the market” or “getting the better end of the deal.” It’s about negotiating a transaction that works for all parties.
© 2010 Ruthmarie G. Hicks – http://thewestchesterview.com. All rights reserved.
The housing market in White Plains has taken a drubbing since the stock market crash of 2008. Although some adjacent areas are showing small signs of stabilization, the same can not be said for the city of White Plains. This is ironic because White Plains was at the epicenter of the housing boom for Westchester County.
White Plains NY Cooperatives:
Cooperative prices were actually up slightly over the same period in 2008. However, this slight uptick might be do to an increase in the proportion of 2 BR units in the sales statistics. The previous quarter showed a grim 17% price reduction and recent sales in specific complexes indicates that this downward trend is continuing. Since 2 BR units are suddenly far more affordable, buyers are finding that they can afford a larger unit. Sales volume is down 17% over the previous year and the current inventory of 9 months indicates a buyer’s market undergoing a price correction bordering on double digits.
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It is very interesting that just as consumers are demanding ever more hyper-local content and knowledge from agents that we are also seeing another distinct trend in the opposite direction: the tendency to list and sell to larger and larger geographic areas.
The contrast between old-school hyper-local agents and the newer nomad agnet was driven home to me while I was working with two listing agents who still work exclusively in small niche markets. I was at a closing with one of them and she implied that since I had the entire city of White Plains to cover, why didn’t I simply refer out the client who finally bought in Scarsdale?
Can a real estate agent be too local?
I knew that the attitude about staying hyper-local is alive and well though it appears to be a staple of old-school real estate. Still, I was more than a tad surprised. Scarsdale is not the moon. It is the town directly adjacent to the west side of White Plains and about a whopping six miles from my front door to the center of the village. If we followed this line of thinking to its most extreme would mean that a buyer potentially moving from New York City to Westchester NY would have to have as many as five or six agents to explore all the possibilities open to them that were within about 30 minute commute. For the consumer this seems most unwieldy if not highly impractical. Could you imagine the mountain of agents all crawling over each other for the buyer’s attention? What a mess. Not to mention a monster of coordination.
From the agent’s perspective, there could also be a danger to being too local. What if something happens to that small segment of the market you represent? If your geography/price range are razor thin – you are setting yourself up for trouble. This was clearly seen this year when agents who specialized in small high-end markets got creamed because jumbo loan issues bit them in the backside. Another listing agent I encountered was used to selling about 10 major properties a year – but this year had only managed a single sale.
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Scarsdale NY housing has been in the cross hairs of the housing recession for a while now. Initially, it was resistant to the correction taking place in other parts of the country. Eventually the forces that had hit other parts of the country so dramatically, came home to roost even in the most resilient areas of Westchester. Real estate values in Scarsdale NY came under prssure as inventories swelled. The drop was severe. However, some of the numbers show signs of a bottom being at hand.
Cooperatives:
The number of co-ops sold are down 15% over the previous year. This is a trend that has been seen in other parts of the county and reflects the difficulties in obtaining financing. Currently there is a nearly 8 month inventory on the market. However, prices remain slightly higher than the previous year, (5.4%) indicating a market that is stabilizing. There are some mixed signals here. the inventory is still high however, the pricing is surprisingly robust.
Single Family Homes – Scarsdale:
After a “pop” during the 2nd quarter prices have once again fallen and are down 27% over the 3rd quarter of 2008. Swollen inventories are going down. Right now inventories are approaching th 6 month mark.
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In surfing the net, I discovered an on-line version of an article by Ben Brody and Laura Gurfein that appeared in last months Westchester Magazine about the county’s “top” Realtors. The subtitle declared “In good times or bad, whether buying or selling, these are the agents you want on your side.”
Now, I have nothing against the Realtors who were chosen as the finest agents in Westchester NY real estate. None at all. it was fascinating to see how the authors chose to define “success.” They used a simple unbiased metric – the bottom line. They defined success in terms of .sales volume in dollars. The theory being – the bigger the sales volume the better the “track record.” This kind of boggles my tiny mind. In a twisted way it reflects the public antipathy to Realtors in general because it emphasizes that “success” is defined in dollar signs.
This got me thinking – how exactly should one define success in real estate? How should these bottom line numbers like sales production and number of listings held factor into a home owners decision about who to sign a listing contract with?
Well, realistically, an agent has to achieve two goals. Certainly, over time, the agent must be able to turn a profit or they will go out of business. This is much harder to do than most people outside our industry think. I have to make a living this way and turning a profit is absolutely essential or my bills don’t get paid. But for all the delusions of real estate agents being “rich” without any effort, the failure rate is enormously high – north of 80% in most of the country (over 90% locally.) So posting sales volume is a major component of success.
But, what does this do for the client? The home seller or home buyer? The article indicated that whether selling or buying – these agents were the best. But by looking at sales volume only, the article missed the mark altogether.
1. Is this agent primarily a listing agent or a buyer’s agent? If they have an even number of sales in both categories – fine. But I looked at the sales history of a couple of these superstars. They were primarily listing agents and did relatively few sales as a buyer’s agent.
2. On the listing side, what is their success rate? After all, an agent can make a bundle listing in volume. The percent of listings that actually sell is another matter.To that end I took a look a closer look at a “top agents” sales record for 2009. I picked an agent on the list at random and found the following.
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Over the past couple of months, I have written some scathing blogs about the big banks (Big Box Bankmarts) and their inability to fund loans in a sane, reasonable and timely manner. I’ve had loans stalled, delayed and otherwise mired in underwriting for months on end for no apparent good reason.
Just the other day Chris Berg created a “movie” using XtraNormal about Big banks and foreclosure sales. If you want a good laugh – you should take a look. This inspired me to try my hand at an XtraNormal video creating my own diatribe on the big banks regarding plain vanilla 30-year loans. I admit that my dialogue can not match Chris Berg’s but the sentiment is the same.
Enjoy the video and have a great weekend.
Further Reading:
© 2009 Ruthmarie G. Hicks http://thewestchesterview.com – Freaky Friday: A conversation with a Big Box Bankmart Loan Officer..
Over the past four months, I’ve had five transactions with one particular big-box bank. All save one were a complete nightmare. What tipped me over the edge towards a new rant was Greg Nino’s post “I am prejudiced and here’s why…”, a post from Michael and Karen George “A Realtor really messed me up the other day.” and the fact that yet another loan is poised to have a prolonged escrow due to a Big-Box Bankmart.
I will leave you guessing as to the identity of the banks in question…I am not as brave as Greg. But I can say this much…my litany of complaints could fill a tomb the size of War and Peace. Mountains were made out of molehills. LO’s went MIA when the going got tough. Papers got lost, closings were delayed (5 times in one instance) the process went on so long that things such as employment verifications required RE-verification. Rate- locks expired and contracts were hanging by a thread because so much time had elapsed. There were extensions on extensions. You name it, it went wrong. The final insult came when the bank then “surprised” the buyers by trying to increase the agreed upon mortgage interest rate by 0.25 points at the closing table.
If the public believes that Big-Box Bankmart is their only choice – it will become just that:
As I said in a previous blog on seemingly endless escrows - all I ever get from the powers that be at any Big-Box Bankmart is snarky arrogance bordering on disdain. Its pretty simple….Big-Box Bankmarts pretty much feel that they are in full control of the situation. The result is a smugness that is simply disgusting. Since the public feels that they are the ONLY game in town – Big-Box Bankmarts feel accountable to no one. If the public believes that Big-Box Bankmart is the only viable choice – it will become just that.
But hubris is dangerous…..There can be accountability – but we have to make them accountable. Let’s vote with our feet and tell our clients why we don’t want them using banks that just have not been performing. The public needs to say “NO!” – we won’t use a Big-Box Bankmart until they clean up their act – and by doing it collectively – we are doing ourselves, and in some ways – our country – a good turn. By using banks and mortgage brokers that can get the job done in a timely manner with decent customer service – we are saying “no” to bad service and a dangerous trend towards Big-Box Bankmart monopolies.
© 2009 Ruthmarie G. Hicks http://thewestchesterview.com. All rights reserved.
One of the many issues confronting first time buyers and those who want to “downsize” is that many crave having an outdoor space. Cooperative life isn’t always conducive to having outdoor space, but the coops on Garth Rd. are an exception. The park that runs behind the Bronx River Parkway side of Garth Rd. creates a wonderful “back yard” for the residents. For those who crave outdoor space and easy to footpaths. The area, called the Garth Woods Conservatory offers a quiet oasis from the usual street and village traffic and appears to be popular with many of the residents. I took advantage of some extra time I had and took a short walk along the Conservatory with my dog Jade. We ran into several canine friends along the way as well as several people who were happy to meet my dog…I wasn’t nearly so interesting.
As can be seen from the photos – many who live along the Garth Woods Conservatory have a birds eye view of the woods – with gardens or terraces having a view of the woods.
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This post was initially published on Active Rain about a year ago. It was during the election cycle so the parallels to our political system make more sense. I have modified it somewhat for this blog. My reason for reposting is simple: Many buyers and sellers seem to fall for the smooth-as-silk , extremely slick salesperson. Many of whom promise to help buyers “steal” a home and sellers sell for a price that hasn’t been seen since 2006. I tend to not work with scripts. I don’t like being scripted to – so I try not to script to others. So here is the post. Enjoy the clip at the end – its interesting nearly a year later as an example of how scripting devoid of understanding or true content can be dangerous to the “scripter” as well as the “scriptee. “
OK, so this idea was stolen from Jennifer Allen and Karen Rice. I only lift ideas from the very best! When I do, at least I’m honest about it! Recently Jennifer wrote about how she felt after she had been pitched to with a script. Karen Rice later described going to a “free” REALTOR.com technology tools seminar. She may have gotten a free meal, but she paid for it with a long hard sales pitch that went on endlessly and offered little of practical value.
For the most part, I readily agree – most of us like to feel that we are too important for a script or “pat” dialogue. Personally, I hate scripts, and haven’t used them. However, my down-to-earth approach comes at a price. I’m not SMOOTH. Don’t get me wrong, I’m not sloppy, but I’m not as polished as a scripted agent because mine is generally an honest response to an honest question. To be smooth – most of us need scripts. That lack of smoothness, answering questions honestly as they are presented can create a feeling of roughness, less polish – the opposite of slick. In many cases it won’t fly. Many audiences are so used to being scripted, they won’t tolerate anything so direct. In some ways, they need to be “sold.”
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Note the newly reduced in price! Initially $474,900 now $469,000. This unit is the most competitively priced 2 BR unit at Jefferson Place. The sellers are serious and are inviting serious offers.
Jefferson Place:
300 Mamaroneck Ave & 31 Greenridge Ave. White Plains, NY 10605:
The Residences at Jefferson place is a large condo complex in downtown White Plains in the coveted 10605 zip code. The complex spans on square block between Livingston Ave. and Rutherford Ave. in White Plains, NY with units on 300 Mamaroneck Ave. and 31 Greenridge Ave. The side facing Mamaroneck Ave. is an eight-story urban mid-rise with a sophisticated brick façade. Jefferson Place is just steps away from all the shopping and dining that downtown White Plains has to offer. The other side of the complex on Greenridge Ave. gives a bow to the suburban neighborhood of the Highlands that it borders.
Just across the street on the Mamaroneck Ave. side there is plenty of fine dining, take out and retail – all within easy walking distance of the complex. The heart of the downtown with all it has to offer is just a stroll down the street. Walk to almost everything: Shopping entertainment, fine dining and so much more. Walk score is 89 out of 100.
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