No! I don’t really want to sell my house.

If you don’t want to sell your house, try one of more of these strategies:

10. Keep it cluttered.

9. Don’t allow a lock box. Insist that potential buyer or agents see the house by appointment only. 24 hours notice required.

8. Don’t show up for the appointment.

7. Make sure your house has animal smells. (Doggy smells are effective, but cat urine works every time!)

6. Large, barking dogs will keep most people away.

5. Insists on showing property yourself. Offer way too much information. Appear needy.

4. Maintain poor curb appeal. Potential buyers will pull up and leave without getting out of their car.

3. Hire a newly licensed agent, preferably a relative, to handle the sale and save money.

2. No sign, no lock box, no MLS entry. Insist that your agent advertise by word of mouth only.

#1. Overprice!!! This one always works!

I KNEW THE DEAL WAS IN TROUBLE WHEN…

I knew the deal was in trouble when the buyer’s agent told me that the buyer was using a lender from Florida! Sure enough, the lender (actually a broker) failed in the first attempt to get financing and moved on to a second source. An appraisal was done that came in as needed. Since the offer was over asking, the lender apparently did not find the appraisal to be creditable, so ordered a second appraisal. It also came in as needed. Long story short…the deal finally closed, but late. The sellers had contracted for their next house, but the close of escrow on the new home was set far enough back from the close of escrow from the sale of the old home that there was no impact except for a few bitten fingernails. The sellers even negotiated a few days of rent-free occupancy in their old home after close of escrow because it was the buyers side that caused the delay in escrow close.

Public Speaking Can Be Too Public

I was reading the business section of my local newspaper the other day. There was a big headline “Home Sales Decline”. Wow! News to me…and to you, too, I’m sure!

 

A smaller headline told us “Mortgage rates remain unchanged”. Good news, but not surprising. In fact, neither of these tidbits was a surprise to most people living within reach of almost any media outlet for the last year or two.

 

Other news filled the page, but what caught my eye was the box next the big headline, with a contrasting color behind the text to make it stand out, that stated “Exec evokes Depression”. Speaking at an investment conference in New York, Wells Fargo President, John Stumpf was quoted as saying that the current real estate conditions are the worst he has experienced during his 30-year career.

 

In a classic example of engaging mouth while forgetting to put brain in gear, Stumpf went on to say, “We have not seen a nationwide decline in housing like this since the Great Depression”.  While I understand Mr. Stumpf’s desire to make a point about the current state of the real estate market, there is no comparison between economic conditions that caused the Great Depression and current economic conditions. Trying to compare the real estate market then to what is going on now ignores the context within which those events took place. What Mr. Stumpf and I each know about what went on during the Depression was learned from our elders, our education, reading…in other words, second hand knowledge. Furthermore, Mr. Stumpf’s 30-year career did not even begin until nearly 30 years after the Great Depression. The fallout from the current travails of the real estate market will have one set of results similar to those found in the Depression…many owners will lose their houses. The reasons for these loses are vastly different from what happened in the Depression. Nevertheless, the headline writer made it appear to the casual reader that we may be in store for another Great Depression.

 

It is a shame that the popular media, which must sell its product in order to survive and which has always used eye-catching headlines and shallow reporting in order to inform (entertain?) its audience had its job made easier by the thoughtless comments that Mr. Stumpf provided.

 

Mr. Stumph has a lot to learn about speaking to the press. The following quote taken from that article made me wonder if Mr. Stumpf’s next career would be as a stand-up comedian.

 

“Stumpf said he didn’t even know about some of the exotic mortgage investments that enticed other banks until he read about them in the newspaper.

 

“‘It’s interesting that the industry has invented new ways to loose money when the old ways seemed to work just fine,’ Stumpf said”

Down Payments Are Back

What happened to the 100% financing that allowed many people to buy houses who had nothing to invest in a house but their hope of watching it increase in value? Gone! Unless you have excellent credit and can document your income there is little chance that you can buy real estate with no down payment. Buyers need a down payment these days. Even with a down payment, you better have decent credit if you want the best financing in today’s wary real estate financing market.

Is that good or bad?

From a lender’s standpoint, a down payment lowers risk. It increases the likelihood that the borrower will repay the loan because the borrower will lose the equity that the down payment bought if he defaults on the loan. It also is likely that the borrower will realize that he is now sharing the risk with the lender. This realization may make the borrower more cautious in assuming this risk, make the borrower a better home shopper and decrease that likelihood that this borrower’s name will be added to the many names on the list of foreclosures across the country.

From the borrower’s standpoint, a down payment should secure a better loan program. Perhaps a lower rate or reduced costs or both. The new homeowner will also be reassured that there is equity in their property to cushion against possible financial emergencies.