Archive for the 'Real Estate News' Category
Caveat Emptor - AKA - Buyer Beware When Buying a Home!
April 26th, 2008 categories: Real Estate News
In the Commonwealth of Virginia ”CAVEAT EMPTOR” - from the Latin : “Buyer Beware”, applies when buying a home. It is up to the buyer to make sure he is getting what he paid for. In Virginia all agents are deemed to work for the seller, whether the agent knows the seller or not. This can easily be changed if the buyer chooses to do so. This is commonly done through a “buyer/broker” agreement, or the “Exclusive Right to Represent Buyer” agreement.The first questions most buyers have is: “How much is this going to cost me?” Well, most real estate brokers will not charge anything extra, as typically commissions are paid by the seller. The next question is: “How does it benefit me?” - The exclusive buyer representation makes a particular brokerage firm and its agent just that, the buyer’s legal representative in the purchase of the property sought. This is a two way street, at least in the Northern Virginia contracts. The agent agrees to represent the buyer exclusively, but by the same token the purchaser agrees to work with that agent alone. This actually makes good sense, since the agent is committing herself to promoting the purchaser’s best interest and perform different tasks for the purchaser. Below is an excerpt from the buyer representation agreement used in the Northern Virginia area that describes an agent’s duties to the purchaser.
“BROKER’S DUTIES. The Broker and Sales Associate shall promote the interests of the Buyer by:
A) Performing the terms of this agreement;
B) Seeking a property at a price and terms acceptable to the buyer;
C) Presenting in a timely manner all written offers and counteroffers to and from the Buyer;
D) Disclosing to the Buyer all materials facts related to the property or concerning the transaction of which they have actual knowledge.
E) Accounting for in a timely manner for all money and property received in which the Buyer has or may have an interest.”
The agreement also mentions the fact that amongst other things, the broker shall maintain the confidentiality all financial and personal matters, plus any other matters the buyer identifies as confidential. The broker will also practice ordinary care, comply with all applicable laws and regulations and treat the sellers fairly.
I think having this agreement in place makes both parties feel better about the relationship. There is a commitment from the agent to diligently work for the buyer, and the agent knows the buyer will not be visiting other Realtors for their services. Since this is a commission based business, the agent feels better about knowing that their hard work will pay off at the end of the transaction. This also makes it easier for the purchaser, having one person as their resource to all the transaction related needs and as he builds a relationship with a particular agent, trust is also built. Trust in knowing the agent understands the needs and desires of the purchaser, that the agent will handle all matters related to the transaction with care, and that the agent is truly looking out the for the purchaser. Having this agreement in place also frees the agent to provide a wealth of information to the buyer that he cannot provide otherwise.
There are many duties that a buyer’s agent performs, and a buyer should rest assured that having a competent agent looking our for his interests and rights will make the home buying process a lot less stressful, a lot smoother and a lot simpler. Buyer agency - it’s a no brainer!
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Can it Be True? No Real Tax Hike?
April 5th, 2008 categories: Real Estate News
It seems Stafford county supervisors have agreed to advertise a “modified, equalized rate”. Taxes in Stafford were supposed to go up from 70 cents to 89.8 cents per $100 for assessed value. Even with the large drop in this year’s reassessment values, the average property owner would have seen a tax hike of about $206. If the new
rate of 84 cents is approved then the average property owner’s bill will only go up $17. That’s great news for most people, but the county administrator is not so thrilled. He wants the board to reconsider the rate, since it will leave the county $9 million short next year.
The supervisors have asked county staff to find further cuts - leaving public satefy departments and school funding intact. Board member are willing to forgo this year’s pay raises and suggest that no new hires me made and some positions go unfilled. Some supervisors believe the level of services will be adversely affected. I’m actually very curious to find out if we, the county residents, will really notice a difference in services with a “budget shortfall”. Maybe that’s navie to say, but will it just mean longer lines at the any of the county offices? Or will it be a lot more significant? I guess only time will tell.
In the meantime, Spotsylvania county, with its much higher assessments this year, will see a 6 cent real estate tax increase to 62 cents. Fredericksburg will see a 5 cent increase to 58 cents. Maybe by next assessment cycle the real estate market will be doing a lot better and the pinch won’t be so bad!
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How Deep Can You Go?
March 9th, 2008 categories: Real Estate News
If you are contemplating plunging into the deep, dark waters of real estate, you might be asking yourself: “How much further will prices plunge?” The Washington D.C. Metro area has been hard hit by the housing recession. That’s not surprising seeing that three years ago the market in the area was doing insane things. Houses would sell the same day the sign went in the yard. If a house was on the market longer than a week everyone thought there MUST be something wrong with it, and the owners would become extremely anxious about the fact their house hadn’t sold yet! Buyers had to contend with multiple offers and a lot of them would not only offer above asking price but they would forgo inspections, appraisal values and any other type of contingency.
Homes would sell regardless of their condition and they would appraise regardless of how ridiculous the price seemed. Anyone and everyone was able to obtain one of the many loans available through creative lending programs - the interest only loans became very popular and didn’t seem to deter a lot of people.
Fast-forward to present time. We are now reaping the consequences of the crazy market. The market that allowed sellers in many instances to make profits of over $100,000 in a year or less, a market were sellers became arrogantly in control has now turned into a buyers’ market. However, the mortgage industry debacle and the doom-saying from the media are keeping buyers on the fence. In the last few weeks I’ve seen at least 3 negative articles, directly or directly tied to the current real estate market , per week in our local paper, The Free Lance-Star. Any buyer would be afraid to take a plunge if they read what’s been printed. Will prices continue to drop? Has the real estate market yet to bottom out? Well, no one has a crystal ball so the truth is, only time will tell. However, I do want to point want out what the media neglects to mention. If you are thinking of buying a home and you have good credit and planning to live in that particular are for a few years - The Time is Now! Interest rates are still very low, hovering around 6% and lower, depending on the loan you get. Inventory is high and prices have dropped tremendously, which gives you, the buyer, endless homes to choose from at much better prices than in the past two years. You can also count on seller assistance in some way, shape or form. If you need closing costs assistance you don’t have to go it alone, the seller will most likely pay most, if not all of your closing costs for you. The buyer is running this show!
Pundits predict that things might start to turn around towards the end of this spring. By no means does this mean will see the market completely balanced, that’s going to take a while longer. But if things do begin to become more balanced between sellers and buyers, it might mean that the great opportunities currently available to buyers might not be there if you decide to wait for things to “bottom out”. You might wake up one morning to find that rates have gone up, sellers aren’t willing to give as much and you missed the “bottom” after all. In my humble opinion it’s a great time to buy a home!
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