We have now pretty much entered the spring selling season full tilt and the Upper Valley real estate market seems to be very active. The first quarter of 2008 was, in fact, so much better than the fourth quarter of 2007, that it seemed like a return to the old days. Lots of properties were on the market and there were also lots of well-informed buyers out there to buy them. Rates remained low then and are still low today. So a lot of positive results in the first quarter of what many feared would be a very slow year and the trend has continued into the second quarter.

On the other side of the coin, days on the market is up slightly, sale prices are down, but not dramatically so, and as we enter the warmer months, loads of properties are being offered for sale. The increased inventory is good for the buyers, giving them more choices and potentially driving prices down some, which is, of course, not so good for the sellers. The other problem area is getting mortgage financing. Lenders, the ones who are still in business, are a lot pickier than in the past and loan applications that require a little creativity or outside-the-box thinking are having a rough go of it. All the lenders want the borrower, in their parlance, to have "a little skin" in the game; meaning no more 100% loans, credit scores have to be higher than in the past, and the really good rates are reserved for the very most qualified borrowers.

So, what to do?

Buyers - get yourself some representation from an experienced agent, who will help you sort through all of the property choices and navigate the purchase and sale process. At the same time, be sure you have no credit problems and get pre-qualified by your lender with a letter to that effect accompanying your offer.

Sellers - Even though you may not want to hear it - listen to your broker, if you have one. If you don't have one, find an experienced agent who will help you put together a strategy to get your property sold for the very top dollar that can be gotten. The days of set the price high and prepare for a lot of negotiation are over. The buyers have too many choices now and will just move on if your price is way off the market. Set your price within 5% of what you are willing to accept and stick firmly to it. You will sell faster and, in the end, get a better price.

Good luck out there!

        

We're all hearing and reading about the "mortgage meltdown" and the "foreclosure crisis", that is occurring all over the country. Happily, here in the Upper Valley, the effects have been minimal. Certainly there have been more foreclosure actions than before, but comparatively speaking, not very many. However, if you or someone you know is in foreclosure or about to be, there are a few things to think about.

Once again, lest it be forgotten, I am not an attorney and do not want to pretend to be one, so any comments found here are strictly from my experience assisting people who are trying to sell their home with the lender breathing down their neck.

Paying the wrong bills: One of the biggest mistakes that folks in financial difficulty make is paying the wrong bills. When there isn't enough money to go around, the tendency is to pay the creditors that make the most noise. That is almost invariably the credit card collection people. They will call the most often and use the most threatening language and the most intimidating tactics. There's a reason for that - THEIR DEBT IS UNSECURED! There is nothing they can do to collect except convince you to pay through harassment. They are smart enough to know that if you are in financial straits, there is no future in suing for the money. They also know that if it comes to bankruptcy, their interests are usually behind the secured debt and there will probably be nothing left for them. Soooo, they call and call and call to get what they can while the getting good. There is nothing for them to repossess, nothing to foreclose on. All they can do is stop letting you charge things.

Paying the right bills: The bills that should be paid first, even though they are usually the biggest are, first and foremost, your home mortgage. The mortgage folks don't usually call very much lulling you into thinking they are not taking action. WRONG!!!  They don't bother to call so much because they are secured. They will take your house and sell it to get their money back. Your house is your biggest asset. It is where you live. Even if you are upside down, your home has the best prospect over time for appreciation. Your credit cards will not appreciate.

The next bill to pay is for your car. You can't get reliably to work without transportation. If you can't afford your present car, trade it in on something cheaper while your credit is still OK. If you just don't pay, they will call some, but ultimately they will come and take your car and you will not be able to buy another one. Protect your biggest asset and the way you get to your job. The rest can wait and they will.

Negotiate from strength: If you see yourself going under water, be proactive. Call your mortgage company. You should at least be able to negotiate paying only the interest on your loan. Some lenders will also work with you to defer payments and add them to the end of your loan. Whatever agreement you work out, get it in writing. Same thing with the car. If you have to trade down, do it before your credit is shot. Don't wait for a miracle until you are trapped with no credit and no cash. Same thing with the electric and the fuel bill. Call up and get on a payment plan and pay it. Cancel the cable and the cell phone and the gym membership. Skip the manicures, the hair appointments, the eating out.

If you have retirement funds, 401k's etc., don't pay bills with the money. In most instances, the funds are protected if it should come to bankruptcy. Why be both bankrupt and have no retirement fund? Check with your attorney for the details and make it work.

The biggest problem for hard working people who have never been in financial difficulty is that they have no experience with it and do the wrong things. Get some counseling from a trusted financial adviser or attorney. But mostly, do something! If you just throw up your hands and hide because you're embarrassed or afraid, nature will simply take its course and you will be the worse off for it. Work through it and learn from it. Good luck!

        

If Buyer Agency or Seller Agency doesn't fit the bill, there are some lesser used forms that exist in some states and not in others:<< MORE >>

The most common and well-known form of seller is seller agency. Seller agency occurs when a property owner "lists" their property with a broker for sale, lease or exchange. Entering into a listing agreement constitutes "agency representation" between the agent, his company, and the seller. This agreement, as a practical matter, opens the door for several things, among others:<< MORE >>

The newest form of agency relationship is Buyer Agency. Though it has been around for many years in the residential area and for even longer in the commercial world, it is still probably the least known and understood of the various forms. Of course, the simple definition is that Buyer Agency occurs when a buyer of real estate hires, in writing, a licensee to represent their interests in a real estate transaction. Though it seems simple, many would-be buyers don't seem to trust the process enough to really use it or even enter into it. I suspect the reason for this reticence is at least partly not knowing enough about it. So, here are a few facts to consider:<< MORE >>

One of the concepts that has become prevalent in the real estate industry over the last couple of decades is "agency". It's always been around either through its presence or its absence, but as state law has developed over the years, agency has become more complicated. There are more kinds of agency, and the laws pertaining to it are more specific.

The basic premise is, as always in regulated professions, to protect the consumer. Consequently, disclosures regarding agency are now required before a buyer looks at a property for sale, before a seller lists their property, and the same applies for rentals in some states. The idea is to help the consumer, especially the first timers, understand their rights under the law and the protections and benefits being afforded them by agency representation.

We will cover the various types of agency and their benefits in the upcoming installments, not in the legal sense, because I'm not an attorney; but from the point of view of a licensee and REALTOR. Stay tuned and see what it means to have an agent represent you in a real estate transaction.

        

I was working on my income tax return today and it occurred to me, like it does every year at tax time, that I'm sure glad that I own my home. As tax relief for the middle class continues to dwindle, about the only remaining deductions of any substance are only available to owners of real estate. In most cases, property owners can deduct mortgage interest, discount points, and real estate taxes for starters and with mortgage amounts soaring right along with home prices coupled with taxes that go nowhere but up, some significant numbers can be used as personal deductions. << MORE >>

Well, if spring is here, then it must also be the beginning of the Upper Valley rental season. Most landlords try very hard to have their leases end in the warmer months between April and October. It seems to work for the tenants as well, because who wants to move when it's ten below zero? So, as surely as the buds begin to show up on the trees, "For Rent" ads start to sprout up and calls start to come in for rental possibilities. << MORE >>

It's now one day away from April 1rst and, contrary to the predictions of many pundits and "experts", the real estate market and the rental market in the Upper Valley area, at least, is humming along as if there had been no downturn. Buyers are buying and sellers are selling. The only important difference between this spring market and spring markets past is that the properties that are selling are the ones that are priced correctly. Of course, this has always been true, only now more than ever. Multiple offer sales are quite common this spring, which you would not necessarily expect in a "down" market. Here's why.<< MORE >>

I don't know how many remember the glory days of the dot.com boom, but in those days (about 1995 - 1998) the real estate market was pretty slow. Probably not in recession, but activity was down, median prices dropped in most areas of the country and a lot of developers and builders lost a fair amount of money. What might have caused such a phenomenon? The country was pretty stable politically. There was no war. Oil prices were stable. Why would real estate suddenly start going south after a fairly good run? << MORE >>