Donna’s rental property in Zionsville’s Sycamore Bend was surely one of the most challenging sales Jennifer has ever closed. The property had been a rental for many years, and it was desperately in need of a face lift just to be sell-able. Donna was not living in Indiana, so the lion’s share of the updating fell to Jennifer’s oversight. If something could go wrong with this transaction, it did. The painters flaked out. A pipe burst. The air conditioner failed. The well failed. The first transaction fell through when the interest rates spiked last summer. But tenacity is a personality trait Jennifer embraces, so she never gave up! Every challenge was overcome, and a new buyer was located. The closing finally occurred without a hitch, and Donna is now free of a burden in Indiana. Now, Jennifer has a colorful Story of Sold for her library, and she’s glad that book is closed!
This house was AWESOME! Loaded and landscaped, huge and gorgeous,
Jennifer knew it would not be a tough sale if she got buyers into it;
but the rub was that this would be the first listing for the
neighborhood in the emerging, post-recession market. Recent sales were
not exactly favorable for pulling top dollar on this one, so the
challenge would be to support list price with sales from outside the neighborhood. Reality was (still is) that 4000 square feet of a house
like that doesn’t sell for under $500,000 in Carmel very often, so
Jennifer felt a $369,000 list price was very very fair, even though
the sales around had not drawn over $300,000 in the past two years.
She was nervous launching at that, but her gut was right; and within a
short bit of time, a full-price offer was received that closed
smoothly. And the neighbors are forever grateful! The summer saw a
handful of homes in that small neighborhood hit the market and sell at
similar list prices, and Jennifer was reminded to trust her gut. It’s
almost always right!!
This was the year that will forever be described as “pure pandemonium”
in the Indiana housing market. The recession melted away with the
winter snows, as plummeting interest rates popped the cork on pent up
demand. Spring of 2013 went from busy to outrageous, and with a housing
industry short on staff in every arm of the business, backlogs plugged
up closing schedules quickly. Matt and Molly’s purchase of 1089 Half
Moon got caught in the USDA queue for weeks…which became
months…but the sale of their home on Pendleton Pike was not to be
delayed. So, as they packed to move (with nowhere to go), Jennifer
worked on the Half Moon owner, who just wasn’t interested in their
request for prepossession. She was really fearful her clients were
going to be homeless with three babies, and she’d never had homeless
clients in 12 years, so she was panicking! In the end, at the last
minute, they were able to acquire prepossession of the vacant house
(though the terms would be considered extortion) until they could get
Half Moon closed, but Jennifer is now seriously thinking about buying
a cheap condo somewhere just to have available for clients in
transition, because that was too nerve-wracking! Anybody know where
she can find something like that?
When Debbie and Don got married two years ago, they ended up with a spare house. The market was really weak at that point, so Jennifer helped them lease it for a year, which offset their expenses (with a little profit to boot), while the market improved and stabilized. The spring of 2013 found the tenant moving on to a new job, and the market extremely robust in their development. The builder had finished up and cleared out, the foreclosures that had haunted the market in the prior year had sold and been revitalized. Several strong sales had occurred over the winter, and the time was right for 1167 S Vicksburg to have a new owner. Believe it or not, the condo was sold in 22 days, for almost list price, and closed just a few weeks later. Debbie and Don are free to enjoy their newly-wedded bliss without a vacant house on their backs, and Jennifer got to write another Story of Sold.
Don told his friend Rick to call Jennifer when he learned Rick was in the market. (Friends give the best advice sometimes!) Rick wanted a property he could apply vision and effort toward to make his home. And he wanted to keep his budget low. Distressed properties are plentiful today, but the delicate balance of price vs condition (to use as collateral on a loan) is a tight-rope walk. Fortunately, Jennifer knew where to point him for financing,
whether he bought a yet-uninhabitable property or something that just needed a
little freshening up. He ended up buying a house that would be considered
somewhere in the middle, and he got the sweetest deal on both the house and the
loan terms. The National Bank of Indianapolis has a loan for buyers that is
just amazing. (Call Jennifer for more details on that!) Jennifer
talked to Rick the other day and it sounds like he’s tearing into that place
without a moment wasted and having a ball doing it. It’s going to be
fabulous when it’s done, and he’s promised to invite her to the unveiling in
Roger and Beth were just about finished raising their children. It was time to downsize from their six bedrooms home to something a little more manageable and less costly. One would think that a large, family home like that would be a rare commodity and a quick sale… but sometimes Jennifer gets surprised by the market and it took a bit longer than expected to find that one ready, willing and able buyer. Eleven months, in fact. Apparently, there aren’t many buyers out there who need a home this big! But Jennifer did not give up! And neither did Roger and Beth. She kept up the advertising, hosted innumerable open houses, showed the house umpteen times, and chased every lead. In the end, it worked, and an acceptable offer was received. When the sale closed in the fall, Roger and Beth were elated. The timing worked out pretty well for them, in the end, as the longer time on market allowed one of their children the opportunity to reside there until a job was secured on the west coast. Jennifer was once again reminded that persistence pays off, though patience is is a trait she is still learning!
When Jen & Jamie called Jennifer about selling 11336 Brentwood Avenue in Zionsville, they had their eyes on a rambling foreclosure that would perfectly suit their blended family (with a little TLC). But securing their dream seemed an impossibility without a sale of Brentwood, and it wasn’t even on the market yet! “Do you gamble?” Jennifer asked, as they talked through options to secure the distressed estate home. They chuckled nervously, but they were all ears as Jennifer explained her plan to get an offer accepted by the bank and buy them time to get Brentwood sold, by gambling with delayed closing and a low amount of earnest money on the line. All were nervous as they submitted the offer on the estate, won in a multiple bid scenario, and began to move forward with their due diligence period while Brentwood was introduced to the market. Failing to sell Brentwood would mean a devastating fall through on the estate, plus the loss of the earnest money submitted, but the season was on their side, Brentwood was in a desirable neighborhood, and they were truly “motivated sellers.” It worked. After a flood of showings in the first week, Brentwood sold and closed in Mid-May. Jennifer will breath again when the estate purchases closes mid-June, but with luck on her side, maybe a trip to the casino is in order?
In my profession, I get to see great joy. But lately, my calling has been to counsel; and sometimes I feel ill-equipped to provide comfort in the stories I hear. Today, I met with four different sellers. Two literally wept at their kitchen tables due to financial strains beyond their control. Strong, intelligent, well-meaning, sincere people – trapped in extenuating circumstances that seem impossible to turn around. What can I say to comfort? My heart just breaks. Good people, losing their homes. How can I help them? At this point, I probably can’t save their homes, but I can help them get a new start and make the transition less abrupt than the sheriff’s unscheduled knock. I have no answers for the greater problems, but I can listen, but somehow this doesn’t feel like enough. Maybe I can provide the slightest bit of hope. BTW, the third seller was a delight, but we have A LOT of work to do on that (very cool) home. The 4th seller screamed at me because he didn’t like the offer I received on his home today. THIS is my glamorous job.
Occasionally, Jennifer runs across a really unique house that she puts on the market with a bit of nervous anticipation. Some are so unique, they’re hard to price and predict how the market will react. 1304 Reeves Rd was a converted barn in the heart of Plainfield with a huge garage & workshop and a unique nautical feel. It was framed by mature trees and impressive landscaping, but the bedrooms were small, the kitchen counter tops were all butcher-block, and it had a “70s ambiance” with a sunny but somehow enduring edge. In 48 hours, she figured out there’s a hot market for that, with two showings books almost immediately. And she hit the nail on the head with the price, because both showings generated nearly identical offers. One was accepted with a back-up in place, and the sale closed about 45 days later.
These suggestions come from David Stevens, president & CEO of the Mortgage Bankers Association (and thanks to Inman News for the interview):
1) MARKETS ARE STABILIZING. The real deliquency rate is down to 8.5% this year vs 10% last year. New foreclosure starts are down. Florida, Nevada & Arizona are stabilizing. All that means less bank-owned inventory, which would give private sales an opportunity to realize some stabilization and opportunity to sell at fair market value.
2) NEGATIVE EQUITY AND DECLINING HOME VALUES ARE CONCENTRATED IN FIVE KEY STATES. In fact, 50% of the total national foreclosure problem is concentrated in those 5 states, so Stevens says that those who quote declines in the average price of homes are using “dangerous data.” In fact, he claims that if the foreclosure sales are removed from total market data, the average sales prices of privately-owned homes would actually be up. Now, I have to say I’ve been claiming this about Indy for the past 5 years. We didn’t have a bubble, we didn’t have a burst. Our foreclosure inventory is moving to a reduced level almost daily. And good, clean, well-priced homes are selling at fair-market value.
3) THIS IS LITERALLY THE BEST TIME EVER TO BUY A HOME. 30-yr fixed rates are actually at 4%. No gimmicks, no tricks. Yes, 4%. They have NEVER before been this low. Did you know that a 2% increase in the rate for a 30-yr loan on a $200,000 house could cost you $87,937 in additional interest over the life of the loan? That is a staggering punishment for not acting NOW if you’re in the market to buy a house with the bank’s money! Some would-be-buyers worry about property values continuing to decline and are sitting on the fence. People! If a $200,000 house declines 5% in the next year, that’s only $10,000. Buying NOW could still save you $77,937 over the life of the loan, and who knows what type of equity you could build if you look beyond the short-term risk. You’ve got to live somewhere. That rental you’re in sure isn’t going to increase in value for you!
4) THE COMING HOME SHORTAGE. I said, “what?” But this makes sense! Gen Y is stabilizing professionally and coming of age. There are now 80 million Americans, ages 18-34 years old. They are the largest generation of Americans ever; even larger than the Boomers. And they will need a place to live pretty darn soon. They won’t be in college or living in their parents’ basements forever. And if you haven’t noticed, there’s not been a lot of new construction in the past 5 years or so. Home values are all about supply & demand. Giddy up, that’s good news when you think about it!
5) JOB CREATION AND TIGHT CREDIT. Stevens believes those two short-term problems are the biggest weight on the housing market. Jobs are obvious, and the tight credit situation is just the pendulum swinging too far from where it was before the crash in 06-07. Give it time, the jobs will return, and the lenders will loosen up a bit. It’s already starting.
Now, I see a lot of wisdom in these comments. #2 is a BRILLIANT way to look at the choice of “risking it” to buy now. I mean, I’ve been bellowing about these crazy low rates since they hit 4% (in fact, for years actually, because they were crazy good at 6% and then 5.5% and then 5% etc), but man, oh man, what would our parents have given to buy with money that cheap 30 years ago? And to realize that holding out to “see what the market will do” could cost that much money?! Also, #4 CURLS MY TOES. He’s so right on that thinking. Hopefully, all these production builders won’t go vertical fast enough and resale will have a chance on the fun-side of the supply & demand game.
Anyway, nobody can predict what will happen this evening, much less the future of the local housing market, but these comments give me hope. Hang in there and if you want to save yourself about $88,000 over the next 30 years, CALL ME NOW 🙂 Happy Friday.