1. House hunting too long. As many as 60 percent of the homes for sale in some markets are short sales. Many other listings are bank-owned (also known as real estate owned or REO) properties, and those homes tend toward two extremes: terrible condition, or so nice at such a low price they receive multiple offers.

Even the nicer, nondistressed homes on the market can end up in and out of contract over and over again due to appraisal or other lending-related issues.

As a result, it is not at all bizarre to hear homebuyers today say they’ve been house hunting for a year, 18 months, even two or three years. When you house hunt that long, you become susceptible to house hunt fatigue, which causes irrationally extreme overbidding out of sheer exhaustion.

Alternatively, it can cause you to settle for whatever house you can get, even if it doesn’t actually meet your needs — then spend the next 10 years obsessively spending to upgrade, improve, repair and furnish the place to try to make it more like the home you actually wanted.

Both of these outcomes negate and deactivate the bargain you stood to score.

To avoid house hunting too long, it’s uber-important to get and stay clear on the differences between what you want and what you need, and to work with a local real estate professional you trust.

Look to your agent to get and keep your expectations centered in reality, so you can make more strategic decisions throughout your entire house hunt, like house hunting in a price range where you’re likely to both find homes that will work for your life and be successful in your efforts to obtain one.

2. Making lowball offers way too low. Overbidding seems like an obvious way to cancel out the bargain potential of your deal. But making excessively low offers — offers sellers couldn’t afford to take if they wanted to — can have the very same result.

Buyers who think they can operate strictly on the basis of buyer’s market dynamics — without realizing that most sellers will need to make enough to pay off their mortgage or at least receive the fair market value for their home — are cutting off their own noses to spite their faces, all in the name of trying to score an amazing deal.

Note to “lowballers”: If you don’t actually secure the home, the superlow price you offered is no deal at all.

3. Freak-outs, stress, drama and mayhem. Once was, it was mostly the buyers uneducated about the homebuying process who tended to freak out and stress the most, especially at the top of the market. These were the folks who found themselves defeated at every turn by buyers who knew what they were up against and were prepared to make their best offer on their first offer.

Fast forward, and now the norm is for buyers to spend much more time reading up on what to expect, but the inundation of information can create brand new mindset management challenges.

Almost every buyer is stressed about whether they can qualify for a loan, and about buying into a down market. Some buyers try to apply national headlines about home prices being depressed to the superlocal dynamics of their neighborhood market.

This is unwise if you happen to be, for example, trying to buy a home in the boomtown real estate markets of Silicon Valley. Others go the opposite direction and deny that the basic truths about, say, buying a short-sale listing will actually apply to them (attention homebuyers: buying a short sale usually takes a long, long time).

The emotional freak-outs that result from having your expectations shattered, sometimes brutally, in the course of buying a home often lead to panic-based and fear-based decisions, which can be costly in the short and long term. Additionally, the stress itself can take a toll on your ability to be productive at work, and can even impair your relationship with your mate, neither of which are worth any deal you think you stand to strike.

Again, managing your expectations by working with a trusted broker or agent you feel comfortable relying on to understand the market in your neck of the woods and the type of transaction you want to pull off is essential to downgrading the role emotion plays in your real estate decision-making.

John Bendall

Broker/Owner

RE/MAX Classic Group

908-231-0700

www.centralnewjerseyhomes.com

Inman News, the leader in real estate and technology news, has selected RE/MAX founder Dave Liniger as the People’s Choice Most Influential Real Estate Leader in 2011.

Liniger, 66, who co-founded RE/MAX with wife Gail in 1973, serves as chairman of the board for the global franchisor. Liniger oversaw the expansion of RE/MAX global franchise operations to eight additional countries in 2011 – there is now a brand presence in nearly every country in Central America and South America, and the franchisor has almost 90,000 affiliated real estate sales professionals in more than 80 countries.

“Our knowledgeable Inman News readers cast their votes for a true visionary of our industry,” says Tim G. Smith, CEO of Inman News. “We are honored to include Dave Liniger among our list of influential past winners.”

Liniger was also selected to the annual Inman 100 list of Most Influential Real Estate Leaders for 2011 — that list is separate and distinct from the individual People’s Choice recognition, and is based on a reader nomination process and an in-house review and selection process by Inman News.

 The customers have spoken!  I’m pleased to announce that buyers and sellers realize what we have always known, RE/MAX agents are the ones that consumers trust most when it comes to navigating a sometimes challenging real estate market. In the 2011 J.D. Power and Associates Home Buyer/Seller Study released Wednesday, buyers and sellers award RE/MAX the highest rankings in customer satisfaction. 

View the buyer survey results

View the seller survey results 

“I want to personally thank and congratulate every one of you for contributing to this prestigious recognition,” says RE/MAX Chairman and Co-Founder Dave Liniger. “It truly reflects your professional excellence, your enthusiasm for education, your commitment to distressed sellers, your individual drive, and many other qualities that serve the interests of your clients. Your efforts change lives, and those people have spoken.”

Obviously Dave Liniger is very proud of our associates and I am too.  Thank you to our RE/MAX agents for your hard work and dedication to the highest level of customer satisfaction.  As well, thank you to the hundreds of cooperating agents we do business with regularly.  Without the continued teamwork of all the great agents in the marketplace we could never continue to achieve all of our dreams, aspirations, and lofty goals.  Thank you!

Existing-home sales rose sharply in December 2010, when sales increased for the fifth time in the past six months, according to the National Association of REALTORS.

The U.S. Department of Housing and Urban Development (HUD) and the U.S. Department of the Treasury released the October edition of the Obama Administration’s Housing Scorecard. The latest housing figures show continued signs of stabilization in house prices and high home affordability due in part to record low interest rates. The housing scorecard is a comprehensive report on the nation’s housing market. “Over the last 21 months, the Obama Administration’s swift action in the housing market has kept millions of families in their homes and provided responsible borrowers with incentives to refinance or to become a homeowner,” said HUD Assistant Secretary Raphael Bostic. “But, with many unavoidable foreclosures still in the pipeline, it’s clear that we have a hard road ahead. That’s why we’re focused on successfully implementing the programs we’ve put in place—such as additional assistance on refinancing and helping unemployed homeowners stay in their homes—and ensuring that help is available to homeowners as soon as possible.” “HAMP is not only an important part of the Administration’s efforts to stabilize the housing market, it has also redefined the loan modification standard for the mortgage industry overall. That has led to more than 3.5 million modification arrangements directly benefitting families in communities across the country still healing from the crisis,” said acting Assistant Secretary for Financial Stability Tim Massad. “Early data shows that well beyond the trial phase, the majority of homeowners are maintaining their HAMP modifications, reflecting the rigorous standards the program uses to provide assistance to responsible homeowners.” The October Housing Scorecard features key data on the health of the housing market including: -Families continued to benefit from the lowest rates in history on 30-year fixed mortgages. Since April 2009, record low interest rates have helped more than 7.1 million homeowners refinance, resulting in more stable home prices and $12.7 billion in total borrower savings. -As expected with the expiration of the Home Buyer Tax Credit, new and existing home sales remained below levels seen in the first half of 2010. At the same time, home prices remained level in the past year after 33 straight months of decline and homeowners added $95 billion in home equity in the second quarter. -More than 3.52 million modification arrangements were started between April 2009 and the end of August 2010—nearly triple the number of foreclosure completions during that time. These included more than 1.3 million trial Home Affordable Modification Program (HAMP) modification starts, more than 510,000 Federal Housing Administration (FHA) loss mitigation and early delinquency interventions, and more than 1.6 million proprietary modifications under HOPE Now. While some homeowners may have received help from more than one program, the number of agreements offered nearly tripled foreclosure completions for the same period (1.3 million). -At nine months, almost 90% of homeowners remain in their permanent HAMP modification, with 11% defaulted. Early data indicate that HAMP permanent modifications are performing well over time, with lower delinquency rates than those reported by the industry at large. At nine months, less than 16% of permanent modifications are 60+ days delinquent. Data in the scorecard also show that the recovery in the housing market continues to remain fragile. For example, foreclosure completions continue to move upward and a large supply of homes are being held off the market. While the recovery will take place over time, the Administration remains committed to its efforts to prevent avoidable foreclosures and stabilize the housing market.

 Tips for Getting Your Home Ready for Fall

Now that summer is beginning to wind down and cooler weather is on its way, it’s time to get some of the routine home maintenance out of the way before it gets too cold. If you don’t prepare your home in the fall season, and clean up the yard, when spring comes along, you could be left with an unsightly mess. Here are some tips to prepare your home for the cold months ahead.

Clean out the rain gutters – If you have rain gutters on your home, fall is the best time to get them cleaned. Cleaning rain gutters isn’t that difficult of a task, it’s just a tedious one. The easiest way to get rid of the junk is to use a high pressure hose, and then use a small trowel to get rid of the rest of the debris. Once you have gotten rid of all the debris, give your gutters a final spray.

Take care of your pots and planters – If you’re like most homeowners, you have some planters or potted plants sitting around the yard. Before it gets too cold, be sure to empty the dirt out of any pots or planters and put them in a place where they won’t freeze. If you don’t empty or store your planters, there’s a good chance they will either crack or fall apart.

Rake the leaves – Keeping your yard free of leaves is an important task for homeowners. If you have numerous trees in your yard and piles of leaves that you don’t take care of, you might find that your grass is dead once spring arrives. Leaves can smother your lawn and replacing a lawn can cost a lot of money, so it’s a good rule of thumb to get rid of the leaves in the fall.

Weed and feed the lawn – The best time to weed and feed the lawn is in the fall. If you add weed killer in the fall, the weeds will store the poison in their roots during the winter season, and will prevent a breakout in the spring. By feeding your lawn with fertilizer in the fall, you are promoting healthy root growth, and this will help your lawn grow greener and faster in the spring.

Give your tools a tune-up – Once you have finished your fall maintenance chores, make sure you clean your tools and store them in a dry place so they will be in working order once spring arrives. Be sure to store metal shovels with the head upwards, as this will help detour rusting when it dries. Sheers need to be oiled up, wheel barrels should be left upside down and don’t forget to spray off the underside of the lawnmower.

How to Avoid a Huge HVAC Mistake…and a Big Expense

As things heat up in our area, I wanted to take the chance to remind you of the importance of regularly caring for your HVAC system.

Failing to properly maintain your HVAC can cost you thousands of dollars. Unfortunately, I’ve had clients confronted with HVAC nightmares due to lack of consistent maintenance. And as a Member of the Top 5 in Real Estate Network®, I understand how important it is to keep your home’s value intact…especially in today’s market.

The good news is, while the cost to replace an HVAC system can be in the $10,000 range, simple maintenance is not costly at all. A filter is usually less than $10 and replacing it monthly keeps your air cleaner and your house less dusty.

Filters should generally be replaced every month when the system is running. Replace filters with the same kind and size as the original filter. If your filter is not disposable, follow the manufacturer instructions for cleaning. If you’re using a high-density filter such as an electrostatic filter, check with your local HVAC expert, who can raise the external static pressure of your system. If the external static pressure exceeds the design criteria of your system, it can negatively impact the performance and life of your equipment.

Your air filter should be located in either the blower compartment of the furnace, in an attached filter case, or in a return air grille in a wall of your home. If you cannot find the air filter, contact your local HVAC dealer for assistance.

Have your local HVAC dealer perform preventative maintenance before the start of a new season. Many companies offer service agreements that may include reduced rates on labor and parts and provide priority response. Service/maintenance agreements may also cover:

-Cleaning indoor and outdoor coils
-Tightening electrical connections
-Checking supply voltage and operating current
-Checking refrigerant charge
-Measuring temperature differential at supply and return registers
-Cleaning blower wheel and motor
-Inspecting and adjusting the burner
-Checking heat exchangers
-Cleaning drain lines and pan
-Checking ductwork for leaks and insulation
-Checking the thermostat

Like many of us, your home is most likely your biggest investment. Simple and regular maintenance will not only preserve your home’s value but help you avoid a potential crisis and unexpected expense. For more information or for a recommendation on a local HVAC expert, please e-mail me. Be sure to forward this email on to your fellow homeowner friends as well!

Sincerely,

John Bendall
RE/MAX Classic Group
Office: (908) 231-0700 650
Mobile: 908-578-1485
john@bendallgroup.com
http://www.centralnewjerseyhomes.com

The Top 5 Pitfalls of Selling Your Own Home

While it is certainly understandable why some people would like to avoid paying a real estate agent’s commission—especially in today’s economy—homeowners need to be aware of the serious pitfalls that can occur before they embark on the process of selling their own home.

As a member of the Top 5 in Real Estate Network®, I have had many clients enlist my services after losing valuable time and money attempting to sell their own home. What seems like a relatively easy undertaking at first, can become a time-consuming and overwhelming process. I’d like to share with you some of the most significant snags that often occur when selling one’s own home:

1.  Ineffective marketing. Most homeowners simply lack the resources necessary to effectively market their own home. Working with a professional real estate agent, such as a member of the Top 5 in Real Estate Network®, however, usually means your home will be marketed to the widest group of potential buyers possible, both through digital and print advertising, virtual tours, and online listing portals.

2.  Mispricing your home. In order to sell your home quickly for the best possible price, pricing your home correctly is critical. This very nuanced process of choosing the right listing price, however, is always best left to a real estate professional. Most who sell their own homes price too high, resulting in their home sitting on the market for an extended period of time. And, unfortunately, the longer a home remains on the market, the less desirable it becomes for buyers.

3.  Missing documentation. These days, a real estate transaction requires more documentation than ever before. It’s virtually impossible for the average homeowner to be aware of all the forms necessary to complete a real estate deal, and missing paperwork will bring any transaction to a grinding halt.

4.  Overlooking legalities. The risk of overlooking important legalities, such as disclosure and compliance regulations that vary from state to state, is high for most homeowners. The average person is, understandably, not well versed in the many laws that govern the sale and purchase of a property.

5.  Dealing with unqualified buyers. If you accept an offer from an unqualified buyer, you can delay the sale of your home indefinitely. A professional real estate agent will take the necessary steps to work with a lender to ensure a buyer is qualified before accepting their offer.

In most cases, owners end up exhausting more dollars than they would have paid in commission when attempting to sell their own home. If you would like more information on selling your home, please e-mail me. I also encourage you to forward this email to anyone you know who might be considering taking on the monumental task of selling their own home.

Sincerely,

John Bendall
RE/MAX Classic Group
Office: (908) 231-0700 650
Mobile: 908-578-1485
john@bendallgroup.com
http://www.centralnewjerseyhomes.com

NAROFF ECONOMIC ADVISORS, Inc.

Joel L. Naroff

President and Chief Economist

KEY DATA: Sales: +7.6%; Single-Family: +7.4%; Condos: +9.1%

WHAT IT MEANS:   Existing home sales surged in April as the federal incentives to buy came to an end.  This, of course was expected.

We saw a similar pattern last fall when the first iteration of the home buyers’ incentive neared an end.  This time, even though long-time owners were added to the mix, the run-up in sales was not nearly as dramatic.  Indeed, the peak was about ten percent lower.

That said, there was a really nice pick-up in demand.   Sales of both single-family and condos were solid.  Geographically, the increases were not that well distributed.  Purchases were up over 20% in the Northeast, nearly 10% in the South and West but down over 6% in the West.  I honestly cannot explain the situation in the West, but it is what the National Association of Realtors says it is.

Prices continue to rise, mostly for single-family homes.  As for supply, it increased.  As I have said on many occasions, I expected that to happen and I looked forward to it as a sign that homeowners have rising confidence in the market and they finally think they can unload their albatrosses. 

MARKETS AND FED POLICY IMPLICATIONS:  This was a very solid report but it doesn’t really tell us what condition the housing market is in.  That is because the government has interfered with the market.

We should expect that sales will fall fairly sharply over the next couple of months and only after that adjustment will we get any decent picture of the market.  The terrible mortgage applications numbers clearly point to slowing sales but that was one week of numbers.  It will take a while before the craziness created by the federal policy is washed out of the data.

I believe the housing market will slowly and steadily improve over the second half of the year as extremely low mortgage rates, modestly improving credit availability and job gains convince people to buy.  Rising prices cannot hurt either.  The markets will not probably do much with this number as Europe still seems to be the issue du jour.

There is also a lot of other data coming out this week including consumer confidence.  So caution will likely be the watch word.  This also doesn’t put a whole lot of pressure on the Fed to do anything, not with a possible European slowdown adding another headwind to the recovery.

Lawmakers Tout Tax Credits For NJ Home Buyers

as reported by BRUCE SHIPKOWSKI, Associated Press Writer
TRENTON, N.J. (AP) ― Concern over New Jersey’s struggling housing market has spurred state lawmakers to develop a proposed refundable tax credit program for home buyers.

Proponents say the measure, which was passed Thursday by the Assembly Appropriations Committee and sent to the full chamber for a likely vote this week, gives potential homeowners a strong incentive to buy now.

And those purchases would likely provide a boost to other businesses, such as furniture makers and sellers, hardware stores and insurers.

The program would apply to homes bought in 2010, which would then have to be the taxpayer’s principal residence for three years. Home buyers would get tax credits of up to $15,000 — or 5 percent of the home purchase price, whichever is less — that would be divided into three equal credits that could be claimed over three taxable years.

The total credits available under the program would be capped at $100 million, with $75 million allocated for the purchase of new homes and $25 million for previously occupied homes. Home buyers would be able to determine their eligibility for the program through an automated process administered by the state Division of Taxation.

“This is a creative and sensible way to revitalize our housing market and our economy,” said Assemblyman Vincent Prieto, D-Secaucus, who is among the bill’s primary sponsors. “Much direct and indirect economic activity is generated through new home construction and home re-sales, so this is the smart thing to do in this tough economy.”