Many persons interested in buying a home seem not to be in any rush.  They are betting that prices will fall further, and that interest rates will remain low.  But what happens if rates rise?  They have in the past, and the government is now in a position it will have to borrow money to pay for all the spending.  How do they do that?  They have to make their interest rates attractive to investors. If you have been paying attention to the world markets the dollar is falling, and may no longer be the currency of choice for safety and trade.  In the last week or so, Australiaraised it's interest rates and it sent panic into the financial markets.  This week it was Norway that raised their rates.  This will set off fear in governments around the world.  They are all in the same boat financially as we are in the USA.  They will also need to attract investors in their bonds, and may want to do so when they can still afford it.  As more countries start raising their interest rates for investments, the quicker they will rise as the next nation has to top the previous offering of other countries now paying lower rates.  There is no magic here.  So shortly we may see other nations start to raise their rates.  At that point, the USA will have no choice but to follow.  When that happens, a rise in mortgage rates can move even affordable homes beyond the reach and qualifications of many.  It can also happen very quickly leaving many would be home owners standing on the sidelines. and their only option is to rent! 

The cost to borrow mortgage money even with modest rate increases will increase dramatically.  An increase in the the 30 year fixed rate mortgage at 4.5% Principle and Interest (PI) at $1013 / month will rise to $1330 PI / month for a 7% That is an increase of mortgage of $317 PI / month!  When you think about it in the 1980's when the markets were not as severe as this one, mortgage rates rose over 7% in less than 7 months.  I personally signed on a home at 9.5% in december, and by June 81' the rate was 15.5%  - the PITI of a 70K loan was over $1500 / Month!

When you amortize $200,000 borrowed a the different interest rates things change even more dramatically.  One of the costs of money, is how long it is borrowed for.   So the borrower also has to look at not just the monthly payment, but what about the increased costs of that higher monthly payment over the 30 years term of the mortgage.  The Amortization of $200,000.00 spread over 30 years  from mortgage rates that start at 4.5% and rise to 7% rises $164,529.87 more interest paid at the 7% loan vs. the 4.5% 30 year fixed rate.

Who Says it's Difficult to Get Bailouts of Government Aid?

Who says it's difficult to get government aid?  Nonsense!  I just read a breaking news story about a house committee investigating California congresswomen Laura Richardson and Maxine Waters .  It seems as though Congresswoman Richardson lost her home in Sacramento which was sold in foreclosure and then Washington Mutual - who then foreclosed on the property... gave it back to her.   The committee is going to examine if she received preferential treatment!  EXCUSE ME???  Question her?? Why not arrest her?   That is a pretty good deal in my books, but it gets better.  Maxine Waters in being investigated for working deal for a troubled Massachusetts-based OneUnited Bank who received $12 million in bailout. Congresswoman Waters never disclosed her husband was once on the board of directors of the bank and still owned stock in it.  Just a detail....The bank received $12.5 million in Federal Monies. (Congresswoman Maxine Waters is a senior member of the congressional committee overseeing banking.)

• Read the Story in the LA Times!
• Boston Globe
• Wall Street Journal
• Washington Post

Does Your Home Say "Welcome?"

There are many things that get buyers into a home other than price. For some the attraction is subliminal and for other signals are very tangible.  Buyers are usually drawn and attracted to a specific home.  In todays market it may be price that gets them on the hook, but the hook that sells homes is that your home says "Welcome!"   Once you have attracted a buyer there is a fatal attraction that must keep drawing the buyer into the home emotionally.  From the initial exposure of the the home perhaps from online marketing or a classified ad, the price, the photos and the virtual tour are some of the things that make a buyer call an agent and want to see that one particular home.  Once you get the buyer to the home, you cannot dissppoint them.

In this current market anyone can give away a home, and yes price over comes all objections, but there is a high cost for thinking that way.  Personally, if you want to give away your home, that's your business.  It's your money!  I beleive in getting the best possible price and terms when selling a home for our clients.  A person handing out free samples all day does not make them a good sales person.  Yes, we all know that price may be the final determinant in this market, but getting the buyer into the home is the first step of a long journey.  If the home is not inviting from the outside, and has no curb appeal...the buyer will tell their agent to "Keep driving" as they come up to the home!  The home owner need not blame anyone but themselves if they get a lot of cancellations and no shows.  There is an obvious reason the home is not being shown!

Does your exterior beg buyers to explore more? - Examine your curb appeal!  Grass cut, leaves off walkway, no strewn clutter, lawn edged, leaves blown and collected, and exterior paint and glass windows must be cleaned for the buyer to move forward.   First impressions count!

Does your interior have buyers running for the exit?  Why?  Once buyers are inside the home odors, pets, dirty laundry, piles of newspapers, and dust you can write your name in may turn those buyers right back out towards the front door!  However good housekeeping will make a big impression.  Clean homes sell faster than those that are in need of a good cleaning crew!

Welcome Signals:

• Price of home
• Terms
• Ease of Deal
• Curb appeal
• Landscaping
• Exterior of home
• Cleanliness
• Upgrades - Kitchen and master bath, flooring.
• Upgrades of Appliances - replace dated dishwashers, hot water heaters etc...
• Updated mechanics - Heat / Air, Electric, Roof, Plumbing
• Maintenance - all sytems in good working order
• Marketing
• Odors and Scents
• Neighborhood
• Appearance

Buyers Agents  Have No Right To Share Their Buyer Clients Feedback on a Property!

When I read posts and comments on Active Rain, and in my daily work as a buyers agent - requesting feedback for the listing agents and sellers... my stomach turns.  Feedback to the listing agent and seller is a leftover from the days that all agents represented the seller's interests as sub-agents.  This use of feedback is obsolesent, and outdated probably by 15 years! Since sub-agency pretty much disappeared in the 1990's with the advent of buyers agency...it is totally amazing how many agents do not understand that if they are representing their buyer. They have the same obligations of fiduciary to their buyer clients as a listing agents to the seller.  They cannot share anything that could give away their clients position!  I would assume in most states, license law does protect the interest of the clients! (In many states even after the obligation of agency ends, that privileged information you hold can never be shared!)

There was a recent lawsuit that has been talked in real estate circles...about where a buyers agent was called for feedback after showing a home.  The buyers agent's clients showed no interest in the home at the time...so when called for feedback.  The agent trashed the home verbally.  Well guess what?  A few weeks later his buyers inquired about that home again.  When they finally decided to write an offer their lower offers were rejected by the sellers.  The seller held out for full price and got it.  At the closing table, the buyers asked the seller, why they held firm on their price.  The sellers identified their agent and continued blow by blow on why they did not want the home.  The seller took it as an insult.  The buyers then sued their buyers agent under state license law and won!  Surprised?  I'm not!  the agents should never have shared anything about the property with an agent that does not have their clients interests first!  How come no one told you?  Most agents are poorly trained by persons that never sold anything in their real estate careers.  These are brokers, trainers, and instructors are sharing their ignorance which is only being repeated by those they train.  There is an old saying, "Those who can't, teach!"

Think About it!

If on a feedback call a buyer agent says my persons really likes the home... it really means

• "They are willing to pay full price!"

If on a feedback call a buyer agent says my persons does not like the home... it really means

• "They will offer less than market because..." -  giving the listing agents an unfair advantage over the interests of the buyer's client

Before giving feedback, you better really think it through and comply with your state real estate license law!  You have no obligation to do so!

I was showing some homes in the Atlanta area today, and 4 of the 5 homes showed in the Internet as "Owner occupied."  "Call agent first before showing" was listed in the private agents instructions in the MLS.  What bothered me most is that 5 of the 5 homes were vacant.  This just creates unnecessary work for the buyer agent, because as you try to caravan your showing route you are waiting on unresponsive agents.  One of the agents said, "My people our out of town this weekend, go ahead and show!" Another said, "1 o'clock...let me get back to you."  It is obvious that no one lived in these homes for over 6 months each.

Since our Supra lock boxes notify the agent within moments of a showing, it is puzzling that the agents would do this to be notified when the homes was going to be shown.  In my own opinion, it is totally unprofessional, and a waste of everyone's time.

Staging Vacant Homes - Who are you really fooling? 

It takes more than furniture, art pieces and a few carefully placed articles to sell a home.  There are other senses that can give away the facts of the home when no one is living there.  Our senses can easily alert us to the most obvious of circumstance.  Smells, odors, and a lack of them can tell a lot about the home we are showing.  Our eyes lead us to the most minute of details that may alert us the home is vacant or perhaps a divorce is taking place.  Many in our industry believe that Staging is the cure all to sell a home.  It may be, but you must pay attention to the details.  Weekly cleaning, opening windows, getting an exchange of air in the home, flushing toilets, cleaning windows, and placing bleach in sinks may greatly improve your chances of selling a vacant home.  Success is always in the details, and if you are going to stage a home please try to pay attention to even the subliminal.  It works.

When showing vacant homes this weekend I became quickly aware that none of the homes I was showing were occupied in spite of wha the listing agents tried to imply.  It was very obvious they were not occupied at all but rather they were all staged.  The reason an experienced agent can advise their clients about the home is that they have been in the business for a number of years.  Drawing on their past experience they can easily recognize when a home is lived in or the owners are just away for the weekend.  How?  By just being very observant and looking closely at the details that are available.   There is no magic.  A new agent or a novice to real estate may be easily fooled, but that is their own problem.  The signals are all very obvious, and all you have to do is pay attention.  Here is a partial list of items I would look for.

How to determine homes are not occupied:

• Air in home is stale, musty, or a mildew smell
• Cobwebs in areas that should be active areas of home
• Dust on counter-tops
• Stove and oven are just too clean
• Lack of any cooking odors
• Lack of heat or air conditioning
• Stale smells and odors in the the home - there has been no exchange of air in the home.
• Toilets flushed or rings in bowl.
• Lack of lawn and exterior care.
• Lack of clothes in a Master Suite Closet.
• Staged Clothes in Master Suite Closets are from another era.
• There is no garbage in the receptacles
• Lack of perishables in the refrigerator
• Leaves on walkways
• Noticeable insects or ants activity remains undisturbed - no one has tried to eradicate.
• Perishables in Refrigerator are all expired (Milk with an expiration date of August!)
• Most homes were staged very poorly with furniture that really did not even belong in a Goodwill store.  
• Uncut lawn or weeds in landscaping.
• News papers on walkways - most especially a lot of wet soggy
• Debris on lawns
• Unattended water intrusions from storms
• Home maintenance that is not addresses - missing roof shingles, overflow from hot water heaters etc.

I guess if someone were to ask me what price ranges are selling for Atlanta area homes, I would have to say anything between 150K and 300K.  Single family detached homes are the most sought after. New homes would come first on the list provide the subdivision has not stalled. I have also noticed that many agents and home buyers are now avoiding short sales because so many in out area are no approved by the bank. There is just too much uncertainty in buying a short sale.   So buyers are being very cautious and looking for the best home for the money in traditional sales.  They are also trying to keep the price down as much as possible mostly in the conforming loan price ranges.  Schools are also a major factor of consideration for many buyers in their search criteria. Also with the rising price of gasoline, buyers are trying to buy closer in.  They are avoiding all risk.  Price, Price, Price and Location, location, location are the buyer's buzzwords these days!

Atlanta Area Homes for Sale 150K-300K

• Alpharetta homes for sale 150-300K
• Atlanta homes for sale 150-300K
• Acworth homes for sale 150-300K
• Buford homes for sale 150-300K
• Cumming homes for sale 150-300K
• Decatur homes for sale 150-300K
• Dacula homes for sale 150-300K
• Dunwoody homes for sale 150-300K
• Kennesaw homes for sale 150-300K
• Lawrenceville homes for sale 150-300K
• Lilburn homes for sale 150-300K
• Marietta homes for sale 150-300K
• Norcross homes for sale 150-300K
• Snellville GA Homes for sale 150-300K
• Sugar Hill homes for Sale 150-300K
• Suwanee GA homes for sale 150-300K
• Woodstock homes for sale 150-300K
• Winder homes for sale 

I reported earlier this evening that another GA bank failed tonight, making a total of 20 banks that failed this year in GA, and the 101st bank failure this year in USA.  However that was several hours ago and we have had another five banks fail since my last post.  This makes a total of 106 banks that failed this year alone nationally!  Wow, I hate to go to sleep and read the morning news!