Wednesday, June 26, 2013

Some Typical Questions That Buyers and Sellers Have About Closings


[Published June 27, 2013, in the Jeffco editions of the Denver Post's YourHub section and in five Jefferson County weekly newspapers]

What do I bring to closing? Because some documents need to be notarized, both parties have to bring photo IDs. If either party needs to bring money to the closing, it should be a cashier’s check payable to him or herself, to be endorsed over to the closing/title company. Both parties will get a draft settlement statement a day or two prior to the closing, so that any mistakes can be identified, explained and/or corrected.

Should I contact the utilities? Yes, you should contact all the utilities except water & sewer, which will be handled by the closing company. The water utility will take a reading on the day of closing and send the final bill to the closing company, which will at closing withhold some of seller’s proceeds — about twice the expected bill amount — for the purpose of paying this bill.  The excess will then be refunded to the seller. This is done because an unpaid water bill can become a lien against the property, and the title company, which insures all liens are paid, can not let a final water bill go unpaid. This is not true of other utilities.

Will gas & electricity be turned off?  No, the seller’s final reading will become the beginning reading for the buyer when he gets around to identifying himself.

Why am I being charged for property taxes when I just paid them?  The taxes you paid were for last year.  This year’s property taxes aren’t due until next April, so sellers are debited at closing for this year’s taxes, pro-rated to the date of closing. This money is credited to the buyer, who will pay the full year’s taxes next April. After closing, seller’s lender will refund money they escrowed.
 

Wednesday, June 19, 2013

Think Real Estate Agents Are Overpaid? Much of the Time, We Work for Free


[Published June 20, 2013, in the Jeffco editions of the Denver Post's YourHub section and in five Jefferson County weekly newspapers]

Most professionals I know get paid for the work they perform. Some even charge for estimates, and others charge even when they fail at what they were hired to do.

Real estate is different. Most of the time we are giving our services away to customers with only a vague hope of a payday down the road.

Sometimes we invest a great deal of money marketing properties that never sell, only to have the seller list the home at a lower price with another agent who gets paid handsomely.  (Trainers advise agents to be the second listing agent on a property — let the first agent take the listing while it’s overpriced.)

I had about 30 closings last year, and I drove 15,000 miles. Do you think I drove 500 miles for each successful closing?  No, I drove maybe half those miles related to successful transactions and the rest for buyers and sellers who received my services for free without any compensation for my time and travel.

This is okay with me. I love real estate. When it produces a payday, I know that it makes up for the uncompensated efforts I expended.

Occasionally I have a buyer who has me take him to the exact house he wants to buy, and I handle the transaction — one showing, no driving around, one contract written, one inspection handled, one closing attended — and a $10,000 payday. The buyer, seeing how easy it was, might reasonably suggest a rebate of my commission. But what about those times I showed a buyer 100 different homes, wrote one or two unsuccessful contracts, only to have that buyer rent instead of buy — or the buyer goes to an open house and cuts me out of earning a commission.  (My fault — I didn’t get a signed buyer agency agreement.)

Recently, I was considering listing 5 acres of vacant land 30 miles up a canyon for $125,000, but the seller was so uncooperative that I ultimately declined the listing — but not before I had made three trips to the property and on one of those trips did $1,000 damage to my car’s underbody on his jagged culvert!

Such is the life of a real estate agent. We may seem overpaid when we are paid five-figure commissions on a given transaction, and you may think that’s unfair, but if we didn’t have those closings to make up for all the times we work for free — or spend without reimbursement — then it might be hard to justify going into this business.  As it is, the average member of the National Association of Realtors earns only $36,000 in gross commission income per year — and that's before subtracting car, phone, MLS, computer and other expenses.

Tuesday, June 11, 2013

New Listing: 1937 Foothills Road, Beverly Heights

[Published June 13, 2013, in the Jeffco editions of the Denver Post's YourHub section and in five Jefferson County weekly newspapers]

 
1937 Foothills Road, Golden
$485,000
This 4-bedroom, 3-bath home with 2,083 sq. ft. of living space is right in the middle of Golden’s Beverly Heights neighborhood on the slope of Lookout Mountain.  Immaculate is the only way to describe its condition. The home has high-end Champion windows and sliding door and 2 gas fireplaces. Standing on the 300-sq.-ft. cedar deck with retractable awning, you’ll enjoy the unobstructed view of South Table Mountain as well the oversized and professionally landscaped backyard with apple trees and garden.
 
Take a video tour at www.Beverly HeightsHome.com
 
 

You Can’t Underprice a Home, But You Can Still Overprice It in This Market

[Published June 13, 2013, in the Jeffco editions of the Denver Post's YourHub section and in five Jefferson County weekly newspapers]

As much as I like to “talk” real estate — whether with my mouth or my fingers — I know it’s just as important to listen.  I can always learn something new, no matter how much I know about a topic.  I’m among the first to sign up for classes in areas where I’m already knowledgeable enough to teach the class.

That was the case recently when I accepted the invitation of Lon Welsh, the successful founder of Your Castle Real Estate, to attend one of his “mastermind” groups — an example, by the way, of why Lon has been so successful with that company.

The group was brainstorming about how to price a home in this seller’s market, and Lon said, “You can’t underprice a home in this market.”

I have enough examples of my own to support his statement. For example, one of my broker associates priced a 1950’s bungalow at $185,000, when I thought it could sell for $200,000.  He got 71 showings and 28 offers in 2 days, and it’s under contract for $240,000 cash with no inspection or appraisal contingencies.  If he had listed it for $240,000, it could have sat on the market and sold for less with no competing offers.

I remember another agent with a listing which became stale at $1.2 million. After a long time on the market, she got the seller’s approval to lower the price to the $600’s, and it was bid up to $1.1 million.  That takes nerve!

Twice now I have lost listings to colleagues who suggested a higher listing price than I did. The seller of the first one literally apologized for doing so after they sold it near the price I had suggested. The second listing?  It’s still available.
 

Thursday, June 6, 2013

Two Updated Properties Just Listed by Golden Real Estate

[Published June 6, 2013, in the Jeffco editions of the Denver Post's YourHub section and in five Jefferson County weekly newspapers]

Five bedrooms for this price? In Golden? This home is in Apple Meadows, a 1970’s subdivision north of 58th Ave., just east of Highway 93. It has been beautifully updated, with new roof, gutters, deck, siding, and triple-pane windows, and transferrable warranties on the windows & siding. There’s a living room on the main floor and a family room in the lower level. In back is the full-width wood deck in great condition with a built-in children’s playhouse. The yard feels oversized and has a garden area,. Take a narrated tour at www.AppleMeadowsHome.com.
Enter this 1933 home and prepare to be surprised at the updates! The kitchen, open to the living room, is fabulous, and who would expect such a great basement? The detached garage, with 220-Volt power, is heated. It’s just one surprise after another! It goes on the MLS today and is easy to show.  Open this Saturday 1-4.  Video tour at www.LakewoodHome.info.

Buyer Activity Slows Down Slightly — Except for Listings Over $600,000

[Published June 6, 2013, in the Jeffco editions of the Denver Post's YourHub section and in five Jefferson County weekly newspapers]

I just completed my monthly statistical analysis measuring buyer activity by calculating the percentage of listings that are under contract.

The numbers are still amazingly high — up 20% over a year ago across the Front Range  as a whole.  The number of unsold homes (both active and pending) is up 16.7% from two months ago, but the number of homes under contract is also up 15.9% from two months ago, so the increase in homes available to purchase is up 17.5% overall. 

Yes, I know statistics can be confusing and sometimes misleading. But they can also be useful is assessing the amount of buyer activity.  The chart below shows that buyer activity has leveled off or declined slightly in the lower price ranges, but, interestingly, increased somewhat in the higher price ranges — above $600,000.

 
And here's a chart showing buyer activity by area and county:
 
 
If you have any questions about these statistics please call or email me.