“It’s the End of the World As We Know It…” or is it?
REM sang it and now we are singing it too. "It's the end of the world as we know it." Of course, we are talking about the end of the Real Estate market. But hasn't that been the hit song sung by CNBC and the news headliners for the last 2 years? So what is the reason for the end of the world this time? Let's recap.
On August 24th it certainly seemed as if the housing market was falling apart at the seams when the National Association of Realtors (NAR) announced the sales forecast for the 2010 year fell short. Sales of previously owned homes fell 27.2% in July as compared to June. That is like saying if 200 homes sold in the month of June then only 146 home sold in July. So why was that such a shocker to the analysts? Did they forget that the 8,000 Tax incentive's Rule #1 was that Buyers had to settle by June 30th. (That was extended by the way at the 11th hour.) Hello people, of course June sales would be higher than July sales. Of course the tax credit would artificially stimulate the number of settlements in June and create a bit of a "hangover" in July.
The Wall Street Journal stated that NAR announced the seasonally adjusted annual rate of sales is 3.83 million and it was at the lowest level since the industry group started its tally in 1999. Immediately, the pundits were on the air saying how incredible this drop was, how far below analyst expectations this was, what a surprise this was and so on. I recall an analyst caught up in the hysteria blindly saying that renting is always the best option for anyone considering buying a home right now. This is a perfect example of the media playing up the doom and gloom card. Remember folks, high ratings are what keeps them on the news and admit it, if they do not sensationalize, we won't listen or watch.
Of course on our end, we have been blogging about the "tax credit hangover" endlessly for months. This dip comes as no surprise for us and if you have been reading our blog and newsletter, this is not a surprise to you either. So much demand was created and condensed in the months of April, May, and June 2010, it only makes sense that there would be a huge falloff in July. Is there cause for concern? Sure there is, in regards to the economy and primarily unemployment. Is it the end of the world as we know it? Of course not! Do we think REM is great? Yes! But we do not like the way the pundits sing their song and we disapprove of the way the media is spinning NAR's calculations. It is quite frankly dampening whatever remains of consumer confidence.
That being said, we are not blind to the negatives either. Let's look at the bad stuff a little closer. With the the home inventory increasing to a supply of 12.5 months (meaning it will take a year and a half to sell what we have for sale right now) and with the increased amount of bank owned properties entering the housing market, and short sales continuing to pop up on the market, there is more risk of price declines in the markets that are already suffering across the nation. More importantly, here in Philadelphia, we see a more stable market with smaller declines across the board particularly for homes priced under $400,000. The luxury home market will feel the sting of somewhat greater price declines due to the buyer pool being smaller.
What does this all mean to you?
Sellers - Price and condition are paramount. Thus, to get your home sold in this market, you need to be priced below your competition AND have a better product. Your house needs to show like a dream. Marketing and exposure are never as important as there are today which is why you really cannot hire your the part-time agent or go FSBO, but hire that agent who excels in Internet Marketing and has a strong presence in the area.
Buyers - Turn the TV off. There is substantial opportunity out there for you. This may be the single best opportunity in your lifetime in that the combination of prices being where they are, the amount of properties to choose from, AND mortgage rates being SO low offers you incredible purchasing power. "But what if prices go lower? " Good question.... But what if mortgage rates go higher?? Even if prices fall $10,000 on that average sales price, that does not even come close to the amount of extra money you will be spending if mortgage rates went up even one point. And I can tell you, sooner or later, this is going to happen.
On the investment side, there are more opportunities out there for investors as well since it is harder for buyers to get loans. In putting my money where my mouth is on opportunity in the Philadelphia real estate market, I have bought two properties in the last couple of months, one in East Passyunk and one in Northwood. More to come on these in our next newsletter!
It's the end of the world as we know it. And I feel Fine!
Got $150? Get a New Fall Look with Voila Design’s Budget-Friendly Staging Services
Need a hand selling a home for less? Voila Design says hello to your budget this fall with their September Specials, guaranteed to spruce things up just in time for cooler temperatures.
We all know that going for a hair color change is the quickest way to shake up your style. Well, salon rats, this applies to home design as well. Snag a one-hour color consultation for $150.00 with one of the Voila coloristas will give any property a fresh feel.
Got an open house coming up? A Two-Hour ReStyle for $200.00 is the simple way to make some changes and get that property ready to show while your client is at work.
Pay some attention to those vacant properties with a Petite Home Staging for $1,200.00. This package will get you rental of furnishings and decor for living room and dining room, along with kitchen accessories and 12 digitally enhanced photographs to help sell your newly styled space.
Give Voila Design a call today.
www.VoilaDesignServices.com
267-886-0317
info@VoilaDesignServices.com
Is Your Dream Home in Dream Condition? Try U.S. Inspect for a Quick Report
So what exactly does a home inspection with the experts of U.S. Inspect get you?
A thoroughly detailed inspection with an on-site computer-generated report complete with photos of suggested adjustments. They are a one-stop inspection shop and promise to inspect 100% of roofs. The intimidating prospect of having a home inspected is simple with U.S. Inspect. Schedule an inspection online and they'll take it from there.
Services include:
- General Home Inspection
- Foundation
- Lead Paint
- Mobile Homes
- Pool and Hot Tub
- Pre-Concealment
- Radon
- Roof (RHI)
- Septic Systems
- Termite
- Well Flow
- Well Potability
U.S. Inspect
1341 N. Delaware Avenue STE 205
215-383-0158
Philly’s Peaceful Cleaning Company: Holistic Home
We all clean our homes with products that we find on supermarket shelves and we think nothing of reading the list of ingredients. Those of us who aim to buy earth-friendly products wonder if these safer products will work just as effectively. I recently brought home a "green" dishwasher liquid and found that it left my plates still caked with food. Gross, right? Needless to say, we went back to our regular cleaner.
Our new philosophy is that we will purchase friendly, safe products if they meet our standards. We worry about chemicals, but we want products that work.
When Ginger Kuczowicz learned about the dangers of most household cleaning products, she was alarmed. Alarmed enough to start her own company with products that could replace the dangerous ones.
"My inspiration to start Holistic Home LLC came from very sobering statistical data showing increase in cancer occurrences over the last 50+ years. After centuries of using simple cleaners, synthetic compounds invaded our homes half a century ago. And because these compounds are not dispersed as easily indoors as outdoors, concentrations of toxic chemicals are higher in our homes than outside (EPA data). Regular cleaners are the most hazardous chemicals in our homes. And although they are not the only cause of cancer and other diseases like asthma, they are significant contributors," she says.
And so she set out into Philadelphia to let people know that there was an alternative to chemical-loaded supermarket brand cleaning supplies.
First, Holistic Home offers cleaning services for apartments, houses, and offices using only natural cleaning products and ecological procedures (e.g. steam disinfection). And just what are they cleaning with? Well, of course they created their own eco cleaning products with mix and match cleaning formulae in a small manufacturing facility according to a client’s needs.
"We use only natural, nontoxic ingredients (mineral and plant derivatives) paired with essential oils. Our practices are truly safe for all of us - adults, kids, pets, and the planet," promises Kuczowicz.
Holistic Home LLC serves the Philadelphia area and will travel up to 20 miles in each direction. That's pretty earth-friendly of them, to boot.
Ginger Kuczowicz
http://www.holistichomellc.com/
215-421-4050
Try A & J Custom Homes for Your Remodeling Needs from A – Z
Lovers and Madmen Coffeeshop in University City.
Pine Street historical renovations in Center City.
These are just a few of Philadelphia area remodeling projects that A&J Custom Homes has made happen. Their showroom is in Swedesboro, NJ, but they service the Greater Philadelphia area as well as South Jersey. When it comes to roofing, siding, additions, kitchen and baths, A&J can provide expert design and development. They are especially handy with accurate historical restorations and urban construction.
A & J Custom Homes
Steve Roche
856-669-9614
If Your Walls Could Talk, They’d Recommend Precision Painting
We all know that sometimes it's the details that matter to potential home buyers. Even the color of the walls can make a serious statement. If it's time for another fresh coat of paint or you're ready for some new details in your new place, Precision Painting will complete the job with impressive results. From the basic interior or exterior paint jobs to the most intricate details or mural work, we swear by this owner-operated business that services the Philadelphia area (mainly Northern Liberties, Society Hill, South Phily), Montgomery and Bucks Counties, and Southern New Jersey.
Painting houses comes naturally to Jeff Werner of Precision Painting, as the artist has been painting , drawing and silk screening most of his life.
"I approach painting a room as I would a canvas, paying attention to details," says Werner.
There's more to painting than slapping some color on the walls, and Precision Painting is a business you can trust to complete the job.
Precision Painting
Jeff Werner
215-275-4497
info@precision-painter.com
Related:
Are you Suffering from Chromatophobia? It’s Time for a Color Consultation.
Meet Philly’s Own Mr. Clean
Have you ever wondered what Mr. Clean's first name is? Well, we know a Mr. Clean in Philadelphia, and his name is Joe.
Joe runs a cash business and there is not much he won't clean and haul away. When we have a clean-out job, we call Joe every time and he is always on punctual and eager to get the job done. If it is not nailed down...he'll take it. Joe has come to the rescue on many occasions when a last minute clean-out was required for a settlement. When we have a clean-out needed, it's always Mr. Clean to the rescue.
Mr. CLEAN
Joe Douglas
267-879-2751
Shots in the Dark. Tips on How to Shoot from Philadelphia Photographer Sam Oberter
If you want to lure in prospective buyers, you'd better have some incredible photos. We thought we'd ask photographer Sam Oberter for some expert insight. You may have seen Sam Oberter's images before (100K House, Skypark Condominiums, Memphis Flats, Voila Design), especially if you live in the Philadelphia area. The local photographer has a background in engineering to bolster his ability to capture residences at their best angles. We found his forward answers easy to relate to and extremely helpful, and a few things even made us chuckle.
Flex Your Budget
If you're trying to sell several million dollar condos, it may mean hiring a photographer that can take extremely high quality photos. Those photos on your point-and-shoot are not going to cut it.
"If you can't afford to hire a photographer, you can try a cheap $30 tripod," suggests Oberter,"Homes in Philadelphia are generally on the dark side, and the flash on your camera is not the answer! Turn the flash off in the settings, and prepare for a long exposure (sometimes a few full seconds) by attaching the camera to the tripod to keep it steady. Spending an evening drinking coffee at Borders, skimming an instructional book on interior photography is most likely worth the trouble, too."
Re-think Wide Angle Shots
"Most homeowner photography typically seems to follow the formula of wide-angle shots from a perspective that attempts to maximize the perceived size of the home. Sometimes that approach is appropriate, but most often not. The most flattering views of your home are found by thinking not only about the architecture, but also furnishings and decoration. Taking a super wide angle shot of your sparse spare bedroom, with just a lonely bed amidst a desert of emptiness, is not a warm and inviting image that will attract home buyers."
Keep it Warm and Inviting
"Non-professional photographers often forget to consider the emotional reaction to an image in their attempts to enhance impressions of their square footage. Creating a space that looks warm and inviting is at least just as important."
Break Down the Bathroom
"Bathrooms, in our city of row homes, can present serious challenges to photography as they are most frequently small and on the dark side. If a bathroom is worth highlighting, sometimes the most graceful approach is to use 2 or 3 images that together illustrate the room, instead of forcibly cramming everything into a single shot."
So there you have it - now you can pick up that camera again and go practice. What are your tricks for photographing challenging spaces?
Sam Oberter currently resides in Philadelphia and shoots residential and commercial projects for a variety of clients and publications. You can view his work and contact him at his website, www.samoberter.com.
Related:
Where are the Photos ? No wonder the listing expired !
[Images via Sam Oberter for Voila Design]
“As-Is”. Are those words the kiss of death for a Seller?
If you are a seller that does not want to replace the 20 year avocado-colored Formica countertop or you think the buyer of your home will be comforted knowing there is a another good year left on your roof or water heater that is two decades old...
You may want to rethink your “as-is” mentality.
“If it ain’t broke don’t fix it.”
Well, sorry to say to all of you “as-is” sellers out there, that phrase is not always true in today’s real estate market. In Philadelphia, where we represent many sellers and buyers for condos and single family homes, we have come to the conclusion that today’s buyer has very discerning tastes. The Modern Consumer (of all goods these days, not just RE) is educated, qualified, and ready to buy, but these folks are willing to wait for the very best property with the lowest possible price. Good for them. But that does not make it any easier on the “as-is” seller.
What is an “as-is” seller to do?
The easy answer is to wake up and smell the nonfat extra foam iced vanilla latte (aka coffee)! Fix it or forget it and lower your price. If you plan on sticking to your “as-is” approach you must price the property under market value and expect your buyer pool to thin out considerably. For buyers, an “as-is” sale is scary and risky particularly for first time buyers. When it comes to the fine art of real estate sales, sometimes it does not have to be broken to recommend something be replaced.
Creative option for the “as-is”-ers
Converting to the creative approach might be a better solution for sellers who really want to sell their property “as-is” but are finding that is not working. The creative path is a good one for sellers who may not be able to put the cash out for a repair. The creative approach is giving the prospective buyer choices whether repairing, replacing or a credit is the best option. The seller can defer the cost of any repair to be paid at settlement from the proceeds of the house.
Example:
A 22-year-old avocado counter top or a roof that needs replacement are samples of an “as-is” feature. The seller can give the prospective buyer a few options to choose. These options prevent the seller from making unnecessary improvements and gives the buyer some power in the decision as well.
Options:
- Replace counter and roof with the seller’s chosen material by the seller’s chosen contractor and the contractor’s estimates can be disclosed to all prospective buyers.
- Credit the prospective buyer with the amount disclosed on the contractor invoices so the buyer can use that credit toward whatever they want to be installed by whoeer they want after settlement.
- Reduce or increase the sale price by the the exact amount of the materials and labor as quoted in the disclosed contractor invoices.
These choices add some complication to the negotiations but that is the nature of trying to sell an “as-is” property in a buyer market where buyers are educated consumers with a decent amount of leverage in the market right now.
Are the words "as-is" the kiss of death for a seller? My answer is: Could be if the seller is not willing or able to be flexible. An old proverb says "A willow that does not bend with the wind will surely break." unknown author
Who Would Sell Your Home Faster: The Man Show or Martha Stewart?
If the female of the house is taking over with too much sugar and spice and all things nice... or the confirmed bachelor pad has the house looking more like a men's locker room than a stylish flat... both can be huge turnoffs for prospective buyers touring your home. Tone down the lilac and lace, girls. And guys, a man cave is oh so passe!
Shoes, shoes, and more shoes
Walking into a closet that is deemed a danger zone because of precariously placed stilettos can be a real problem. Sure, the female you're showing a house to will turn to her partner and declare that the closet is just PERFECT for her shoe collection. She'll already be plotting a way to line them up according to heel height. But the guy, on the other hand, will immediately look around the room and think "Great. There's no room for my sparse belongings." If you are an admitted Shoe Monster, consider storing your shoes with some organization - try these shoe stacking bins from the Container Store - BEFORE showing your home to prospective buyers.
Don't over-do the fluffy decorative pillows, floral patterned tableware, or dust-catching collectibles. This isn't your grandmother's house!
Managing the Modern Man Cave
We've witnessed several styles of man caves over the years. We're all familiar with the traditional dank basement or garage with tools and broken-objects-never-fixed. Then there's the sports "lounge" with pool table and mini fridge accessorized with empty beer cans and nacho crumbs. This also takes on the form of video game den with various controllers strewn across the floor and a shrine of energy drinks. Well, these days, the modern man cave is a geek's technology retreat, complete with wild servers and multiple monitors, spare hard drives, blinking lights and the sound of machines lightly humming.
If this sounds like you or yours, you might try switching to wireless devices, such as a wireless keyboard and mice, or a wireless monitor, to minimize unsightly cords. Run your speakers through the wall like a high end home theater. And as for the camera and phone accessories and the video game controllers, keep track of it all with a media rack such as the Coop Tower or the Wire Cube Shelf.
Otherwise, you're limiting the potential of your property to attract those searching for something that's beyond a bachelor pad.
[image of pillow from saksfifthavenue.com, image of cube shelf from CB2]