Before You Sign That Lease…

It’s a familiar moment: you are about to enter into an important agreement, and as you lift the pen to sign your name, you pause. Your pen hovers over the Signature line for an extra moment as you register how important this will be in shaping your future…

When it comes to home rentals in our area, just such a moment occurs when you are about to sign the next year’s lease agreement. Local rentals largely echoed the national trend to higher prices and tightening supply, so the number of dollars on the bottom line can make that hesitation linger a bit longer than before.
The fact is that the local housing situation today is vastly different than it was just a couple of years back. Especially for anyone long accustomed to local home rentals, it’s worthwhile to re-examine some major factors that point to the best housing solution. Three of them have to do with finances, timing, and lifestyle. 

* Ownership can offer significant financial advantages. Tax savings are usually the standout factor: if you can deduct the interest you pay on a home’s mortgage, you stand to save that interest amount times your tax rate – versus (just say goodbye to it!) your rental payment. Maintenance and real estate taxes have to be considered as an added cost, but homeowners also stand to benefit from any increase in the value of their home. The aftermath of the epic slide in housing prices finds us currently situated near the first part of the ‘buy low, sell high’ truism. There are no guarantees when it comes to investing, but despite large dips during recessions, most houses regain that lost value -- and more -- during economic booms.

* Record low home mortgage rates combined with the dip in home prices have green-lighted this summer for anyone waiting for the timing to be right. Local buyers are not only finding homes at affordable prices, but are also paying historic lows on amounts borrowed. Lately we’ve been reading about mortgage rates reported as low as 3.4% on 30-year loans! 

* Finally, there are all the intangibles that come into play. Local rentals certainly alleviate some of the effort involved in caring for your own property, but on the other hand, it’s tough to put a price on the value of finally having real control over your living situation. Any tenant who has been uprooted when the landlord decides to sell or move back in knows the kind of upheaval that results from an unexpected and unwanted move. 

Sometimes home rentals offer the best option for a family, but it never hurts to run the numbers. Market conditions have rarely been as ideal as they are right now for area home buyers -- and I’m here anytime to go over the latest figures if you would like to take a look!

"It's my money and I want it now."

I have just returned from a closing for a home I sold at auction. The owner was able to receive the proceeds from his home in less than 100 days from listing to closing. We took seven weeks to prepare and market the auction. The buyer was given six weeks to close. This represents a much shorter time than most traditional selling periods.

When is it smart to sell real estate by auction? When having the proceeds earlier is important. Many owners have their property vacant during the marketing process. The mortgage payments and other expenses continue. Heir property is always a good prospect for an auction sale. Multiple owners are often difficult to have in communication when an offer is received. With an auction everyone knows the date and time in advance when an offer will be received. The reserve price has been agreed upon. When the bids exceed that price all of the heirs have agreed to sell. In a traditional sale only the asking price has been established. When one of the heirs goals does not line up with his relatives it can get tense. Some will want their money now. Others may want to wait for a higher offer that may or may not materialize.

With an auction we establish a minimum price that will be accepted. Dates are selected for the sale. A closing date is determined. A marketing plan and budget are established. In traditional real estate an asking price is determined. Marketing plans are developed but an end date cannot be determined. The budget is somewhat open ended. The cost of ownership continues. The home or property must be kept in a constant state of readiness. If an offer does not come the price is lowered and the process restarts.

The value of a home is determined by a price a knowledgeable owner will accept and a knowledgeable buyer will offer when neither party is under duress. Value is related to the condition and location of the property. When a property will sell is determined by the asking price and if the market place knows it is available. Advertising is key to selling homes. A Realtor must devote a portion of their expected commission to advertising the property. Will marketing time be 60, 90 or 180 days? With limited resources the marketing budget must be spread over a longer period of time. In an auction sale marketing time is generally about six weeks. The budget can be spent in a relatively short period of time. Normally we advertise the reserve price which attracts more buyers. Buyers are attracted to an auction in hopes of getting a great buy. Many will come to watch the show. The excitement of an auction attracts buyers.

If you need your money now we can help. If a fellow Realtor has a client that this process could help we would be happy to work with them.

Check out our websites:

www.Gary-Barker.com
www.GaryBarkerAuctions.com

Your Invited

Times have been tough. The flow of retirees coming to our great city has been slow the past three and a half years. Many have theorized that most were waiting for their market to recover. Recent election results indicate that change will be slow and not sudden. These potential newcomers will still face higher property and income taxes in their home state. I feel most have been waiting to retire. Now facing much of the same for another four years they will be compelled to accept the new reality and sell their home and finally retire.

The good news is they can still get a bargain here. Interest rates are the lowest I have seen in my career. I believe we will see a steady flow of retirees moving south once again. So for any retirees or potential retirees who might read this I say,

"Your Invited"

Opportunity - Real Estate Auction

For Sellers

You decide what day you will receive an offer on your real estate. The auction process creates excitement and a sense of urgency. Buyers compete for your real estate. You sell "As is, where is". Your price will increase as the auction progresses. Selling conventionally, often you keep lowering your price until you receive a low ball offer. Remember there are only two reasons your property has not sold. Price and advertising. If the property is priced properly and people are aware, it will sell. Advertising for an auction is concentrated for a particular date. The day of the auction you can decide whether or not to accept the bid.

For Buyers

Typically an auctioneer will have information and disclosures available in a convenient location for your considerations. You get to experience how the rest of the market views the property. Appraised value is what a knowledgeable buyer will pay and a knowledgeable seller will accept when neither is under undue distress.  The other bidders are providing real testaments of value.  A live auction is an appraisal. A buyer will pay only what the property is worth on that day. Which may be less than others are asking.

For Brokers

The auction process lets you concentrate your efforts for a particular property for a date certain. It will expose more buyers to your listing. In this market how many sellers have not received an offer. In recent years prices have continued to lower. Selling now may be better off selling now rather than later. Bringing a buyer client to an auction may help you find them a great value and allow you to earn a commission. Most auctioneers will participate with Buyer's Agents. 

Experience a Real Estate Auction

I will be conducting a real estate auction on August 25 at 11:00 at Unit 10 Eastern Shore Townhouses. See my website www.GaryBarkerAuctions.com . It has the terms of sale and information about the property.

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Control the Timing for Your Home's Sale

Every homeowner can have all sorts of reasons for selling their house. Those in the boomer generation can be in one of the traditional phases of retirement (planning, transitioning, initiating) or perhaps in one of the newly-popular phases (postponing, rejecting).

For them and everyone else, the decision about whether to sell the house falls into one of two categories: those triggered by economic pressures -- or all the other reasons. In all cases, being in control of the timing of your house sale will put you in control of the process. That pays off.

Even if the money factor doesn’t rule, it’s vital to first do some hard-nosed dollars-and-cents calculations before putting your house on the market. Find out what a realistic listing price range will be. I or another experienced Realtor can be a major asset in establishing this: you can count on a complimentary consultation that will offer comparable current values for home sales.

Then consider current rental rates for a house like yours. Sometimes you will be surprised to find that the most beneficial course would be to rent your house for an interim period, especially in light of some evidence that a market rise is just beginning. When you are penciling out these factors, be sure to include realistic maintenance expenses and, if you are moving out of the area, property management fees. I can help here, too.

If financial pressure is the key motivating factor, make sure you have weighed the alternatives before sealing the decision to sell your house. If you haven’t done so already, find out if refinancing is an option. The first answer isn’t necessarily the final one: check with other financial sources as well as your current mortgage holder. Mortgage rates are lower than ever, and if unmanageable mortgage payments are at issue, this could be the most direct route to reducing that outflow and giving you time to sell on your own timetable.

Being methodical and patient when deciding about any house sale can make a big difference in the bottom line. I’m here to provide current information and guidance that will help make that possible.

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252 635 1100




Gary Barker
PO Box 513
Bridgeton, NC 28519

Relocation : Lower Stress

As moving time approaches, most internal stress meters start twitching around the time we have to figure out how many cartons it’s going to take. A cross-town move is one thing -- sometimes you can even handle it yourself (with the help of bribable friends and relatives, of course).

But suppose you have just accepted a new job promotion in New Bern or are being stationed at Cherry Point. Of course, you’re immediately excited by the adventurous prospect of the summer’s relocation. But suppose your new position is located in a new zip code – and maybe even a new state. Your move up the professional ladder could also mean spending a lot more time and money on the move itself…and once here, the demands of your new position will double your need to pay attention to your career.

Fear not: your Realtor has seen how clients achieve a smooth transition with a minimum of stress. And we are happy to share some of the strategies that work best:

1. Lighten the load. The more belongings you and your movers have to pack, carry, and unpack again, the more costly the move will be. You can significantly lower the cost by getting rid of all the possessions you no longer use on a regular basis (there are probably more than you think!). Hold a yard sale, donate to charity, or just give those items to friends and family. Realtors are forever advising clients to de-clutter, but this holds doubly true when you are relocating. When you’re done, you’ll feel like a huge burden has been lifted from your shoulders! Stress meter: down.

2. Plan in advance. Real estate agents and relocation pros will always stress advance planning. As soon as possible, sit down and list the steps you need to take, then put them in order. You will find this gives you more time to make decisions, and more time to shop (and save money). For example, if you are buying a New Bern home and are working under a strict deadline, you could back yourself into a hurried decision instead of allowing time for your agent to expose you to all the additional options. By planning ahead -- meeting with me as far in advance as possible -- you can allot enough time to establish a relationship that allows your agent to introduce the full range of neighborhood options. Stress meter: down.

3. Consider using professionals. Before dismissing the idea of hiring professional movers because of cost, spend a day obtaining estimates from at least two or three companies, then compare with do-it-yourself moving costs. Be sure to check with the HR Department at work or with your Command to explore the compensation that may be provided for your move. You can often obtain a binding estimate that is valid for about 60 days. Compare those figures with the cost of renting a truck, driving the distance, and hiring moving help on one or both ends. Hiring professionals is a one-time cost that will relieve you of the hassle – not to mention the emotional toll – at a time when your attention should be directed to your profession.  Stress meter: down. 

The move to a new town can be anywhere from nerve-jangling to serene. If your future could include relocating to New Bern / Cherry Point, please feel free to contact me for some practical local advice. We have many excellent neighborhoods here in our area that I’d love you to see!


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Gary Barker
PO Box 513
Bridgeton, NC 28519

Why Experts Urge Their “5-Year Rule”

Even some veteran renters are looking at today’s housing market and wondering whether it’s time to start a home search. With prices and mortgage rates as low as they are while rents continue to move higher, the numbers point to home ownership as an ever more obvious choice. 

But that’s just the quick, back-of the envelope budget equation: monthly rent vs. mortgage payment less tax savings. If this June finds you at the start of your own local home search, many financial advisors recommend that you also consider another rule of thumb – you should plan to stay in your new home for at least five years. I always recommended a three year rule throughout most of my career. But recently I have told buyer clients that if their plans did not call for holding for five years perhaps purchasing is not for them. With younger clients I often explain the advantages of keeping a first time buy with the idea of using as a rental when it is time to move up. Most people spend about a third of their take home pay on housing. Having a couple of paid for homes at age 60 makes for a solid retirement supplement.

Transaction costs are only one consideration that makes this a good idea. Here are some of the others why it’s prudent to think about the 5-year planning horizon as you conduct your home search:

Financial Safety - Homeowners need to have at least some extra liquidity: funds set aside as an emergency resource in the event of unforeseen loss of income. Affording a home and its maintenance costs should never jeopardize the financial health of your household. Liz Weston of MSN.com recently asked several experts for their calculations regarding home repairs. Their answer? Plan to spend at least an additional 1% of a homes’ value on maintenance each year.

Resale Value - The significant overhang in distressed homes will likely continue to exert at least some pressure on home values for the near future. If you need to sell your home two or three years down the road, you may come up short when all the moving, transaction, and other expenses are considered. It may be at least that long before the familiar growth in residential real estate value resumes.

Sanity – Studies have shown that moving is one of the top stresses in life (up there with death, divorce and illness). Personally, I think a well-planned move is a little less dire, but it is true that a happy homeowner is a settled homeowner. When you’re starting your home search, consider the changes coming to your family in the coming years: New baby? Child to college? If you know a move is eminent in the near future, consider finding a home with long-term rental value. Buy a home that can grow with you and you’ll find yourself much more financially secure…and sane!

The current low prices and 30-year fixed mortgage interest rates aren’t likely to last forever, and that old adage remains true: buy low, sell high. If you’re looking for a reason to start your home search in the area now, call me for a serious look at this June’s market.


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252 635 1100
Gary Barker
PO Box 513
Bridgeton, NC 28519

Making the Most of Your Virtual Tour

If a picture is worth a thousand words, how many words might a video’s flood of pictures be worth? The scientists at George Washington University approached the topic a few years ago in connection with real estate virtual tours. To those of us whose profession is helping our clients buy and sell homes in our area, their findings were --to say the least-- interesting:


They arrived at this conclusion: “Adding a virtual tour decreases the expected marketing time by about 20% and increases the expected sales price by about 2%."  I've put that in bold, but you get the idea: those are some serious stats. Since today’s fast-paced world rewards being able to get information quickly, it’s small wonder that video tours are so powerful. But to be useful, video tours need to be well executed. Local homeowners who are preparing for a video shoot can keep some general guidelines in mind. 


For openers, it’s important to remember that the camera will be acting as the eyes of a first-time visitor, so prepare for virtual tour s as you would for an open house. Remove all personal effects like toothbrushes and medications from bathroom countertops, kid's artwork from refrigerator doors, and collectibles throughout. Stage furniture to look inviting, making certain that rooms are not overfilled. Just as in an open house, clutter can give buyers the impression that the house is smaller than it actually is.


Today's high-quality, 360-degree digital imaging can capture even tiny details, so be certain to thoroughly clean everywhere. Pay particular attention to reflective surfaces like mirrors, windows and appliances – the tiniest mark on these can pick up light and dominate an otherwise perfect scene. 


Homes that are bright appear inviting and lead to greater buyer interest. Before shooting a virtual tour , be sure to replace any blown or dim light bulbs, clean all the windows, and open any window coverings to let in natural light. Don’t worry about too much light blinding the lens – the camera operator will ensure that doesn’t happen.


By keeping these ideas in mind, local homeowners can help insure that their virtual tour  encourages buyer interest -- hopefully leading to the kind of shorter listing time and higher selling prices the university study indicated.  That’s why I always strive to include some form of virtual or online tour for my listings. If you are thinking of offering your property this summer or fall, call me to discuss how we can make the most of the market. 

Why Not Add Luxury to Your Home?

When the real estate market undergoes the kind of wide changes we’ve seen recently, you would expect changes in how prospective buyers approach their choices. No surprise there.
With lending tight and larger deposits often being sought by lenders, many home buyers are seeking ‘move-in ready’ properties…homes that require little or no out-of-pocket cash before moving in.  That growing segment of the buying public has grown weary of bargain-hunting, are tired of viewing REO’s and short sales -- and just want to be able to settle into their new home as-is. They want a bottom line cost that's nailed down. 

Automatically qualified to interest such homebuyers are today’s local luxury homes: homes with features that bring a higher-end “feel” -- even if their size or location would seem to indicate otherwise. Adding some of these features can send the ‘luxury’ message…and adding some of those features can cost less than you’d think! 

 Luxury homes almost always have a well-planned, open kitchen.  One step in the right direction is to simply remove everything from counters to create the look of more space.  The current tendency is to value kitchens with a multitude of storage and counter space. Where that’s not possible, actually more important will be adding new appliances with a modern feel: go for stainless steel to create the feel of luxury – possible even in modest spaces.

Another feature qualifying luxury homes is at least one luxury bathroom. Here, it is hard to get past the need to provide ample space for comfort, though spa-style baths are one item that can do the trick. You may also consider a tile mosaic backsplash: that kind of tasteful design touch goes far toward creating a feel of luxury. More simply (and economically), just changing out the faucets to a brushed nickel or other metal surface (please - not gold!) can do the trick.  Add fluffy white towels, an orchid or two, and great smelling candle and voila! Instant luxury.  Depending on the layout of your bathroom, changes can be pleasingly inexpensive.

Luxury homes may also include green features.  New windows, added insulation, and solar heating are prime examples, but without the budget for major improvements, it’s also possible to take a more modest approach. New energy-efficient LED light bulbs can be one minor feature that can add appeal to today’s luxury homebuyers.  You may also consider getting your home LEED rated through a national or local institution.  Not only will your family benefit from installing green features, but it will encourage most buyers to consider your home a notch above the competition.

 Of course, there is no substitution for good old-fashioned personal advice.  If you’re mulling over your own home sale , contact me anytime for a custom consultation about practical ways you can maximize your prospects.

Surprise and Delight - Psychology of Selling

When you choose a Realtor who will be your home-marketing partner, you are choosing someone who will need to fill many roles: marketer, stager, tour guide, negotiator.  And don’t leave out another role -- psychology major!   

To build our kind of successful track record, a real estate agent needs to study and understand the way prospective buyers think about their search for a future home, how they are likely to react to different forms of presentation, and what builds or detracts from the value they assign to your property. It’s psychology, all right -- and it’s usually an integral part of any sales or marketing success.

A good example of how psychology can affect a real estate transaction comes from a study done at the University of Texas. There they have a Real Estate Finance and Development Program. A couple of years back, they began conducting some psychological studies, and one of them used sophisticated statistical tools and a huge sample of real estate transactions.

What’s fascinating is what they discovered about using the word “new.” Real estate agents who marketed homes with phrases like “new paint,” “new carpets,” and “new roof” wound up selling them for slightly less than those who did not!  

The study’s explanation is that, for homes that are not brand new, touting “all new” features seems to call attention to the fact that the items mentioned needed to be replaced. It unnecessarily opened the door to suspicions about what went wrong that made replacement necessary.

A more effective strategy is one that I frequently favor: under-promise and overdeliver. Rather than trying to convince buyers how “new” an older home is, do the renewal work, but don’t brag about it.  Then when potential buyers walk into the home, they will be impressed by the new carpets and fresh paint.  It’s the approach that uber-successful Zappos company founder Tony Hsieh calls “surprise and delight.” What is effective for leading a company and retaining customers can also be psychologically effective for selling a local home.

Sometimes when I show one of my listings that has a flaw, I will exaggerate its seriousness on the ride over to the home. Invariably the potential buyer will say its not that bad. Then they are very receptive to the remedy. Of course it is always better if the seller completes all repairs. Some sellers just don't have the necessary resources. 

As a Realtor in our community, I am constantly reminded of how important it is to never stop learning. If you are considering selling your home and are looking for cutting-edge marketing and advice, I hope you’ll contact me for a complimentary consultation.

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Seven Tips to Stage Your Home

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  7 Tips for Staging Your Home

  Make your home warm and inviting to boost your home’s value and speed up the sale process. Read

Visit houselogic.com for more articles like this.

Copyright 2011 NATIONAL ASSOCIATION OF REALTORS®

How do you measure a FROG (finished room over garage)?

With a tape measure. All kidding aside not everyone understands how to accurately report the  heated square footage of a finished room over garage. Consumers have placed a great deal of importance in the heated square footage of homes. Many buying decisions are based on these numbers. This reliance on a number versus the utility of a floor plan may not be the best basis for determining value. We are however faced with the reality that the consumer gives great consideration to these calculations. Because of this fact a standard for reporting has become necessary. The Real estate Commission has published standards for reporting these numbers. (NCREC guidelines).

The first determination is whether the FROG can be included in the Living Area of the  home.

The NC Real Estate Commission defines the Living area (sometimes referred to as "heated living area" or "heated square footage") as space that is intended for human occupancy and is:

• Heated by a conventional heating system or systems (forced air, radiant, solar, etc.) that are permanently installed in the dwelling - not a portable heater - which generates heat sufficient to make the space suitable for year-round occupancy;
• Finished, with walls, floors and ceilings of materials generally accepted for interior construction (e.g., painted drywall/sheet rock or panelled walls, carpeted or hardwood flooring, etc.) and with a ceiling height of at least seven feet, except under beams, ducts, etc. where the height must be at least six feet four inches [Note: In rooms with sloped ceilings (e.g., finished attics, bonus rooms, etc.) you may also include as living area the portion of the room with a ceiling height of at least five feet if at least one-half of the finished area of the room has a ceiling height of at least seven feet.]; and
• Directly accessible from other living area (through a door or by a heated hallway or stairway).

If the space meets the criteria above it is included in the stated space of the home.  If the ceiling is sloped you must first determine where the slope ceilings become less than five feet tall. Most frogs have sloped walls on opposing walls. Measure from the five foot mark to the opposing five foot mark or the vertical wall if its height is more than five feet. When measuring ground floor space you measure to the outside of the exterior walls. In a second floor space that is different than the first floor space below it you measure to the interior wall and add six inches for each wall. Once the measurements are made a multiplication of the dimension is made. Don't neglect to include the space of the stairs. Sometimes it is missed because it may ascend over unheated space of the garage.

If the FROG's space does not meet all of the criteria above, the amount of space could be stated in the MLS or in advertising but not included in the main living area. Great care in describing the space would be required to not misrepresent the property.

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4200 Elizabeth Avenue - Rent - Buy - Rent with Option

Very cute two bedroom, two bath home convenient to shopping and employment is available for rent or purchase. The current tenant will be moving out August 16,2011. If you or your client needs to rent but ultimately wants to buy, this home could be for you. Many folks moving here for employment or with USMC orders may have a home elsewhere that has not sold. Most folks would not want to move twice. We can fix that. My client (my sister) will rent this home for $795 per month and will enter a contract for sale for $109,000 with a due diligence period equal to the lease. In plain language that equates to renting with an option to purchase. This a no risk opportunity for someone who needs a rental but would like to purchase a later date.

We are looking for a tenant purchaser who is credit worthy. Please have a credit score of 680 or higher. Someone who is trying to repair their credit is not eligible.

This home has an open floor plan. The bedrooms are split. Great for roommates or small families. The master has an incredible walk in closet and large master bath. The kitchen has a large pantry cabinet and lazy Susan  lower. The home sits on one of the larger corner lots in the neighborhood. But not to worry the POA keeps the yard mowed. This make this home great for someone who travels or works long hours. It is a great neighborhood for someone whose spouse may deploy.

If you have an interest or have a client for whom this home would work call me at 252 635 1100. If you are working with a Buyer's Agent give them the address or MLS number 82400 and they will arrange for a viewing. For more pictures and information visit the web page below.

http://gary-barker.com/4200elizabethavenue.html

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Do I need a buyer's agent?

The answer for almost everyone is a yes! Sometimes people think they can save money by not using a Realtor. By the way not all real estate agents are Realtors. A real estate broker using the title Realtor has voluntarily joined an association that requires higher standards of education, ethics and professionalism.

In most markets sellers sign listing agreements with Realtors. Those agreements many times call for that agent to share the commission with a buyer's representative. So if you purchase the property without using a buyer's agent the full commission is paid to the selling agent. The seller' net proceeds is the same and you have not realized any savings. In most cases without the advice provided by an agent you will have paid more or made expensive mistakes.

A good buyer's agent will have assisted with finding home inspectors, lenders and closing attorneys that are competent and reasonable.  A buyer's agent will have the resources to provide comparable sale data. He or she will also have experience in negotiating price and other terms. A Realtor will provide standardized contracts that are fair, clear and that avoid pitfalls for buyers. If you buy a home that is listed, the seller will have a seasoned professional on their side. They have handled dozens or even hundreds of transactions. My fellow Realtors are very good at what they do. Going into a real estate transaction without a professorial on your side would be like stepping up to the plate at a  MLB baseball game without ever holding the bat. Unless you get hit by the pitch the outcome will be you walking back to the dugout talking to yourself.

OK, you are still determined to try to save a few dollars. Perhaps twenty per cent of real estate may be sold as a for sale by owner(FSBO). Your thinking I can get it for the fair value minus the commission. Who determines what the fair value is? Do you have the experience and files necessary to make that judgement? Do you know how to determine the heated square footage of the home? Is the seller's asking price fair? Many FSBO are priced well above fair market value. Many FSBO have been rejected by brokers because the owners insisted on prices well above the market value. This is especially true for properties bought at the peak of the market.  Do you know how to search out that information at the Register of Deeds?

Perhaps the property has hidden flaws that the seller does not want to disclose. Licensed real estate brokers are held to a much higher standard than an individual seller. Once you close on the transaction getting any relief from the seller will be very difficult. Realtors and other licensees are required to reveal any material facts that can effect the value of the home you are purchasing.

For most the purchase of their home is the largest transaction they will ever have. Can you afford a mistake? Enlist the help of a Realtor willing to represent your interest to the exclusion of all others, even his own. When purchasing real estate employ a Realtor. I believe it will save you heart ache, time and money.

Gary Barker

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6 Tips for Buying a Home in a Short Sale

By: G. M. Filisko

Published: March 19, 2010

By preparing for a real estate short sale, you can emerge with a great home at a favorable price.

1. Get help from a short sale expert

A real estate agent experienced in short sales can identify which homes are being offered as short sales, help you determine a purchase price, and advise you on what to include in your offer to make the lender view it favorably. Ask agents how many buyers they've represented in short sales and, of those, how many successfully closed the transaction.

2. Build a team

Ask agents to recommend real estate attorneys knowledgeable in short sales and title experts. A title officer can do a title search to identify all the liens attached to a property you’re interested in. Because each lienholder must consent to a short sale, a property with multiple liens, like first and second mortgages, mechanic’s and condominium liens, or homeowners association liens, will be harder to purchase.

A title search may cost $250 to $300 up front, but it can help weed out less desirable properties requiring multiple approvals.

3. Know the home’s fair market value

By agreeing to a short sale, lenders are consenting to lose money on the loan they made to the sellers to purchase the home. Their goal is to keep those losses as low as possible. If your offer is dramatically less than the home’s fair market value, it may be rejected. Your agent can help you identify the price that’s good for you. The lender will determine whether approval is in its best interest.

4. Expect delays

There are two stages to a short sale. First, the sellers must consent to your purchase offer. Then they must submit it to their lender, along with documentation to convince the lender to agree to the sale.

The lender approval process can take weeks or months, even longer if the lender counteroffers. Expect bigger delays if several lienholders are involved; each can make a counteroffer or reject your offer.

5. Firm up your financing

Lenders will weigh your ability to close the transaction. If you're preapproved for a mortgage, have a large downpayment, and can close at any time, they’ll consider your offer stronger than that of a buyer whose financing is less secure.

6. Avoid contingencies

If you must sell your current home before you can close on the short-sale property, or you need to close by a firm deadline, your offer may present too many moving parts for a lender to approve it.

Also, consider ordering an inspection so you’re fully informed about the home. Keep in mind that lenders are unlikely to approve an offer seeking repairs or credits for such work. You’ll probably have to purchase the home “as is,” which means in its present condition.

This article includes general information about tax laws and consequences, but isn't intended to be relied upon by readers as tax or legal advice applicable to particular transactions or circumstances. Consult a tax professional for such advice; tax laws may vary by jurisdiction.

G.M. Filisko is an attorney and award-winning writer who luckily has avoided the need for a short sale on her properties. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.

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Copyright 2010 NATIONAL ASSOCIATION OF REALTORS®

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Do-It-Yourself Home Security Check: 5 Essential Steps

By: Joseph D'Agnese

Published: November 12, 2010

Conduct a do-it-yourself home security check by walking around your house to assess what needs to be done to reduce the risk of a break-in.

1. Keep your home well-maintained on the outside

Burglars want an easy target. Stand on the street outside your house and ask yourself: Does my property look neglected, hidden, or uninhabited? A front door or walkway that’s obscured by shrubbery offers crooks the perfect cover they need while they break a door or window. To improve security, trim shrubs away from windows and widen front walks.

2. Install motion detector lights

All sides of your house should be well-lit with motion-activated lighting, not just the front. Simple motion-activated floodlights cost less than $50 each, and installing them is an easy DIY job if the wiring is already in place.

3. Store your valuables

Thieves want easy-to-grab electronics, cash, jewelry, and other valuables, though some are not above running down the street with your flat-screen TV. Most make a beeline for the master bedroom, because that’s where you’re likely to hide spare cash, jewelry, even guns. 

Tour each room and ask yourself: is there anything here that I can move to a safe deposit box? Installing a home safe ($150 to $500) that’s bolted to your basement slab is a good repository for items you don’t use on a daily basis.

4. Secure your data

While you probably won’t be putting your home computer in a safe anytime soon, take steps to back up the personal information stored on it. Password protect your login screen, and always shut off your computer when not in use (you’ll save energy, too!) Don’t overlook irreplaceable items whose value may hard to quantify, like digital photos.

5. Prepare ahead of time in case the worst happens

• Take a photo or video inventory of items of value in your home, and store the file online or in your home safe. Check that you’re properly insured for theft. Note that high-ticket items in your home office, such as computers, professional camera equipment, or other business essentials, may require an additional rider or a separate policy.
• 
  

Joseph D’Agnese is a journalist and book author who has written numerous articles on home improvement. He lives in North Carolina.

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Copyright 2010 NATIONAL ASSOCIATION OF REALTORS®

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7 Hot Home Improvement Trends that Make Your Home Work for You

By: Lisa Kaplan Gordon

Published: May 13, 2011

Home improvement trends embrace energy efficiency, low maintenance exteriors, and double-duty space.

TREND #1: MAINTENANCE-FREE SIDING

We continue to choose maintenance-free siding that lives as long as we do, but with a lot less upkeep. But more and more we’re opting for fiber-cement siding, one of the fastest-growing segments of the siding market. It’s a combination of cement, sand, and cellulosic fibers that looks like wood but won’t rot, combust, or succumb to termites and other wood-boring insects.

At $5 to $9 per sq. ft., installed, fiber-cement siding is more expensive than paint-grade wood, vinyl, and aluminum siding. It returns 80% of investment, the highest return of any upscale project on Remodeling magazine’s latest Cost vs. Value Report.

Maintenance is limited to a cleaning and some caulking each spring. Repaint every 7 to 15 years. Wood requires repainting every 4 to 7 years.

Trend #2: Convertible spaces

Forget “museum rooms” we use twice a year (dining rooms and living rooms) and embrace convertible spaces that change with our whims.

Foldaway walls turn a private study into an easy-flow party space. Walls can consist offancy, glass panels ($600 to $1,600 per linear ft., depending on the system); or they can be simple vinyl-covered accordions  ($1,230 for 7 ft. by 10 ft.). PortablePartions.com sells walls on wheels ($775 for approximately 7 ft. by 7 ft.).

A Murphy bed pulls down from an armoire-looking wall unit and turns any room into a guest room. Prices, including installation and cabinetry, range from $2,000 (twin with main cabinet) to more than $5,000 (California king with main and side units). Just search online for sellers.

And don’t forget area rugs that easily define, and redefine, open spaces.

Trend #3: A laundry room of your own

Humankind advanced when the laundry room arose from the basement to a louvered closet on the second floor where clothes live. Now, we’re taking another step forward by granting washday a room of its own.

If you’re thinking of remodeling, turn a mudroom or extra bedroom into a dedicated laundry room big enough to house the washer and dryer, hang hand-washables, and store bulk boxes of detergent.

Look for spaces that already have plumbing hookups or are adjacent to rooms with running water to save on plumbing costs.

Trend #4: Souped-up kitchens

Although houses are trending smaller, kitchens are getting bigger, according to theAmerican Institute of Architects’ Home Design Trends Survey.

Kitchen remodels open the space, perhaps incorporating lonely dining rooms, and feature recycling centers, large pantries, and recharging stations.

Oversized and high-priced commercial appliances—did we ever fire up six burners at once?—are yielding to family-sized, mid-range models that recover at least one cabinet forstorage.

Since the entire family now helps prepare dinner (in your dreams), double prep sinks have evolved into dual-prep islands with lots of counter space and pull-out drawers.

Trend #5: Energy diets

We’re wrestling with an energy disorder: We’re binging on electronics—cell phones, iPads, Blackberries, laptops--then crash dieting by installing LED fixtures and turning the thermostat to 68 degrees.

Are we ahead of the energy game? Only the energy monitors and meters know for sure.

These new tracking devices can gauge electricity usage of individual electronics ($20 to $30) or monitor whole house energy ($100 to $250). The TED 5000 Energy Monitor ($240) supplies real-time feedback that you can view remotely and graph by the second, minute, hour, day, and month.

Trend #6: Love that storage

As we bow to the new god of declutter, storage has become the holy grail.

We’re not talking about more baskets we can trip over in the night; we’re imagining and discovering built-in storage in unlikely spaces--under stairs, over doors, beneath floors.

Under-appreciated nooks that once displayed antique desks are growing into built-ins for books and collections. Slap on some doors, and you can hide office supplies and buckets of Legos.

Giant master suites, with floor space to land a 747, are being divided to conquer clutter with more walk-in closets.

Trend #7: Home offices come out of the closet

Flexible work schedules, mobile communications, and entrepreneurial zeal are relocating us from the office downtown to home. 

Laptops and wireless connections let us telecommute from anywhere in the house, but we still want a dedicated space (preferably with a door) for files, supplies, and printers. 

Spare bedrooms are becoming home offices and family room niches are morphing into working nooks. After a weekend of de-cluttering, basements and attics are reborn as work centers.

Lisa Kaplan Gordon is a HouseLogic contributor and homebuilder.

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Copyright 2010 NATIONAL ASSOCIATION OF REALTORS®

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