Subscribe!Welcome! This blog tracks the real estate market in the Central Shenandoah Valley, featuring market data and analysis, an exploration of common buying and selling questions, and candid commentary on all things real estate.
If you are interested in discussing any of the topics on this blog, or the details of your specific real estate situation, call or e-mail me!
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How close are buyers coming to the asking price? |
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 One issue that often seems to be on a buyer's mind these days is the question of how much they should be able to negotiate off of an asking price for a house. Let's take a look at closings from the past 30 days to provide some insight into what buyers are actually accomplishing right now in the market. Examining all residential sales in Harrisonburg and Rockingham County (10/17/2008 - 11/16/2008) we find...
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Would it be alright if we go see the house again? |
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 I sometimes have buyer clients who after seeing many homes, feel the need to re-visit one or some to further lock-in their priorities and decision. Sometimes these buyers tentatively ask if it would be o.k. to revisit such a home. My answer? Absolutely! If we need to return to a home a second time (or a third time) to take room measurements, get a feel for the layout and flow, become comfortable with the size of the yard, that's fine! Buying a home is a huge investment of your money, and your new home will hopefully be where you live for many years to come. Let's make sure we're finding you the right house! | |
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Looking for investment properties in Harrisonburg? |
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 Some investors wonder whether there are any good opportunities anymore in buying investment properties. You will find good investment opportunities if...
If you're interested in seeing either of these properties, or having an investment analysis for these or other properties, feel free to call (540-578-0102) or e-mail me (scott@cbfunkhouser.com). | |
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Comparing Good Faith Estimates (GFE's) |
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 I always encourage my buyer clients to talk with at least two lenders. Different lenders offer different loan programs, closing costs, incentives, and more. Often, however, this leads to comparing what can be two very confusing documents --- the good faith estimates from each lender. The Good Faith Estimate is a document intended to outline all of your purchasing costs, and thus is a good document to use when deciding between your two favorite lenders. But it can often be quite difficult to make the comparison because costs can have so many different names on the GFE, and because there are non-lender fees included in these estimates. If you are deciding which lender to use based on closing costs, remember to subtract out all of these costs before you make the comparison:
I hope I haven't complicated things further --- just remember that you should not just look at the bottom line of the Good Faith Estimate when you are comparing lenders. | |
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Covenant Heights - affordable housing in Harrisonburg |
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Hope Community Builders is a non-profit organization in Harrisonburg who builds and sells high quality, affordable housing for those who otherwise may not be able to afford to buy a home.  As an example, someone who can only qualify for a $140,000 mortgage, may still be able to purchase one of these brand new duplexes or townhomes in Covenant Heights that are selling between $168,000 and $175,000. Here are some same financing scenarios from recent purchasers...  As you can see, there is a potential for $150 to $175 a month savings on mortgage costs. For more information about Covenant Heights, either...
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Discovering Termites at Closing |
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 That's not to imply that any settlement agents in Harrisonburg have wood-destroying insects in their conference rooms, but rather... The standard Virginia purchase contract places some minimum termite treatment and repair requirements on the Seller, but does not mandate disclosing the infestation or damage at the time of discovery. Here's what you need to know:
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Choosing a Realtor as a First-Time Buyer |
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If you're buying a home as well as selling a home, many people select the Realtor that they will work with based on how each Realtor will market their home for sale. If you're a first-time buyer, and you don't already have a relationship with a Realtor, this leaves you with the following main options:
Set up a brief meeting with a few Realtors and talk to them generally about what is important to you in a house, and in a Realtor. Select the Realtor you will work with through the buying process based on having had real, in-person conversations with several Realtors so that you understand the service that they will provide to you, and so that you can sense whether your personality and communication styles will work well together. I would certainly love to be one of those Realtors you talk to as you decide who to work with through the buying process. Call (540-578-0102) or e-mail (scott@cbfunkhouser.com) if you'd like to set up a time to get together, perhaps for some coffee. | |
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Multiple offers? In this market? |
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Yes --- sometimes we are still seeing multiple offers! A house that shows well, is priced well, and is marketed well can still generate strong buyer interest --- even in a market where we are seeing 22% fewer sales than last year. We received three offers in the first week on this delightful home on the northern end of Harrisonburg.  1143 Waterman Drive, Harrisonburg, VA | |
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What if you could buy a house for $100.00!? |
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 In some real estate markets, home owners are turning to a raffle to try to sell their home. (Thanks to Josh for the tip!)For example, Angela Schaab in Grand Rapids, Michigan is attempting to sell her boardwalk condo by selling 2,500 $100 raffle tickets. As of today (9/27/2008) she has sold 235 tickets. Or, read the story of several owners attempting raffles in the Wall Street Journal's Raffles: Real Estate's Latest Game of Chance. So --- what do you think? If there were a house on the market in Harrisonburg, and you could buy a raffle ticket for $100 --- would you buy one? | |
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Three small, but significant words . . . "on or about" |
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 The "Settlement" section of a standard Virginia real estate contract reads....Settlement shall be made at the office of the Purchaser's settlement agent on or about October 1, 2008. Did you catch the three small words so innocently wedged between the location and date of the closing? The meaning of those three words (on or about) is often overlooked! Some sellers think, or assume that the date filled into the contract will be the actual closing date. It very well might be --- but oftentimes a buyer or seller's circumstances will shift it a few days in either direction. So, the first thing to remember is that it is usually just a close estimate of when the closing will occur. But what happens if (in the above example) a buyer informs the seller that they won't actually close until October 22nd --- three weeks later. May the seller indignantly demand that the buyer close on October 1st, OR ELSE? Contractually, no! "On or about" is typically understood to mean plus/minus 30-60 days, depending on the attorney. That certainly allows for some flexibility, and this is the second thing to remember --- the standard contract language will not allow you to precisely plan the day or week of closing. So, what is a seller to do? BAD: If you need to close on a precise date, or no later than a particular date, you'll want to add "time is of the essence" to the standard contract language. With such language, if the settlement does not take place by the date in the contract, the contract automatically becomes null and void. Of note -- I rarely suggest using "time is of the essence". Having the contract "die" after a certain date usually doesn't help either the buyer or the seller. If the buyer wants to buy, and the seller wants to sell, and the final closing documents are one date late, should the deal really automatically die?? BETTER: A better option is to introduce a (positive or negative) financial incentive for the buyer to close in a timely fashion. Perhaps a positive financial incentive for closing on (or before) the scheduled closing date. Or, an increased purchase price or other penalty if the closing is more than X days later than scheduled. BEST: Leave well enough alone --- don't change the standard contract language. Understand the above, but be flexible and willing to adjust, within reason to make the closing process smooth and successful. I hope this is clear --- feel free to leave a comment below, or call/e-mail me for further clarification. | |
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What is market value? |
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I received a call the other day from a Realtor who was representing the seller of a house that I had showed to some of my buyer clients. I was informed that "the owner just had the house appraised, and the appraisal came in $20,000 above the asking price." I believe the conclusion that I was supposed to come to was that the house was a great deal, even at the asking price.
Certainly, this is a bit ambiguous, but my main point is that we can't make any assumptions about what the market value is of a house. | |
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Price Points: estimating housing payments... |
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I often have conversations with people considering their first home purchase who want to first get an idea of how much they would have to pay for housing on a monthly basis. I have devised an Excel mortgage calculator that I can use to give them a rough idea, or I recommend that they call a lender to get pre-approved. | |
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The effects of motivated, equity-laden home sellers |
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As I regularly mention, even though home sales are down in this area (the number of properties being sold) -- median and average prices are staying steady or increasing slightly. And yet, there is an interesting phenomenon going on that I have observed several times lately in different neighborhoods in Harrisonburg... | |
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The time-value of an interest free $7500 loan to first-time home buyers |
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Over the past few weeks I have been explaining to many first time home buyers that if they buy a home before July 1, 2009 they can take advantage of a $7,500 tax credit. Some, though, have been less than enthused because the full $7,500 tax credit has to be repaid over 15 years. Yes, that's right --- even though you will pay $7,500 less in taxes for the tax year in which you make your first home purchase, you do have to repay these tax savings in years three through seventeen. I thought I'd take a look at the value of what is essentially an interest free $7,500 loan. For this analysis, I am examining the aggregate savings from not paying interest on the $7,500, using a current interest rate of 6%.  As you can see --- over the course of the 17 years, you save a total of $4,050. Thus --- even though you are paying back the $7,500 tax credit, it is still at a significant ($4,050) savings. | |
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Go For The Gold: How to compete and win as a home buyer |
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Are all buyers created equal? Certainly not --- especially from a seller's perspective in our current market.  Here's how I would rank buyers, from the most exciting to sellers (#1) to the least (#9)...
The good news is that you can (sometimes) take steps to move up this list:
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"First Time" Home Buyers --- Act Now! |
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 If you haven't owned a home in the last three years, you have a unique opportunity if you buy a home in the next 11 months (before July 1, 2009).The new Housing Bill signed into law by the President this week provides a $7,500 tax credit to first time home buyers (anyone who hasn't owned a home in the past three years) with income up to $75,000 for single people and up to $150,000 for married couples. When do I get the money? A $7,500 credit will be applied to your income taxes for the year in which you close on your new home. This doesn't reduce your taxable income by $7,500 (a tax deduction) --- it reduces the taxes that you pay by $7,500 (a tax credit). I've heard I have to give the money back? Yes --- the $7,500 must be paid back over 15 years, starting two years after you take the tax credit. This is an additional tax liability of $500 per year for those 15 years. So if I have to pay it back, why is this tax credit so exciting? In essence, you are being provided with a $7,500 interest-free loan. This can be the needed advantage for first time buyers to know that they can make a home purchase work for them. The $7,500 will certainly make up for what you paid for closings costs (in most loan programs) and even part of your down payment. If you have more questions, check out this list of frequently asked questions. | |
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$7500 interest-free loans, and other perks of the housing bill |
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The president is expected to sign a new housing bill today (July 29, 2008) that may have significant implications for current and hopeful homeowners. Here are a few highlights:
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The tables have turned --- SELLERS are now making offers! |
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 Here's an interesting phenomenon --- in most real estate transactions, the buyer makes the first move, by submitting an offer to purchase a house.In stark contrast to this (time-proven?) norm, I have recently had several Sellers make an offer to sell. More specifically, when it became known that a buyer was seriously considering the purchase of the seller's home, the seller proactively either:
If you are a seller, considering such a strategy, I would advise you to consider that:
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Can I search for homes on your blog? |
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 I have had several people ask me this lately --- people who are planning to move to the Shenandoah Valley, and have been reading my blog to better understand the local real estate market. These two blog readers asked whether they could search for properties for sale on my blog.Can you? You bet! From my blog, you can click on the "Searching" tab on the top menu bar. (Or, since you're reading this post, you can click on the search image to the right). My hope is that you'll find that searching for homes in Harrisonburg and Rockingham County has never been easier. We give you quite a few search options: sdfs
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Seller: "C'mon -- do your job -- convince those buyers to buy!" |
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 If only it were that easy!When I am representing a homeowner in the sale of their property, I am:
The reality is that I often don't have that opportunity! Most buyers these days are working with a Realtor and thus have someone representing their interests. I can talk the ear off of their Realtor to try to convince them of the merits of the house that their client has viewed, but I don't have the ability to directly affect the buyers' decision making. Alas, in a market where sales are much slower than previous years, most homeowners really wish that I (or their Realtor) could make that connection with the potential buyers --- and somehow, somehow, convince them to buy! | |
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Scott Rogers
Coldwell Banker
Funkhouser Realtors
540-578-0102
scott@cbfunkhouser.com
Licensed in the
Commonwealth of Virginia
Apparently the photo accompanying this blog post is quite mystifying, as several people have already called or e-mailed me this morning to ask what on earth it is. Can you tell what it is??? A prize will be given to the first correct respondent. :)
November 17, 2008 11:54 am
It's a dartboard.
November 17, 2008 3:07 pm
Thank you John! I'm glad I'm not the only one who can see that! I'll e-mail you about your prize!
November 17, 2008 3:12 pm
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