Best time to be a buyer?

It is right now.

Why?

Real estate is like traffic.  Do you want to be driving on Nicholasville Road at 2:PM or 5:PM?  Timing makes a huge difference.  This might be a bad example because personally, I don’t want to be on Nicholasville Road at ANY time of the day.

At 2:PM there is still a lot of people on the road, but fewer drivers.  By 5:PM, everybody who is going to be on that road IS on that road.

In the market, spring and summer are when there are the most buyers out snatching up houses.  It starts to slow down some about the time school starts.  Then it slows down more around Thanksgiving.  Then it really slows down around Christmas.  Then in January it starts picking up again.

We are in that sweet spot where buyer activity will be slowing down some and we are also seeing a good amount of new listings too.   Later in the year, buyer activity will slow down more, but there won’t be as many houses.  It will be like driving down Nicholasville Road in the middle of the night…..sure, there is no traffic, but that is because nothing except Wal-Mart and a few gas stations are open.

Also, sellers tend to get a little nervous the later in the year it gets.  The Lexington sales graph is like a gentle rolling hill.  It gently rises to it’s peak in the late spring and early summer and settles down in the fall/winter.  Some of the surrounding counties look like Mt. Everest.  Their market is dead, then they have 3 months of steep sales increases, then decrease back down to nearly nothing in the fall and winter.  Most sellers assume fall and winter are bad times to sell and plan accordingly, but it is a non-issue for Fayette Co sellers.

We still are likely to have more buyers than houses in the sub $250k range, so I am definitely not saying that it is going to change to a buyers market, just that you may actually have a chance of buying a house without competing with 5 other offers.  Over $250k with the exception of the most popular neighborhoods, you have a better chance of not getting in multiple offers this time of the year.

So be encouraged if you are a buyer and go get you a house!

How to pick a winner of a house

Okay…..You are buying a house in Lexington Ky.  You are concerned about resale potential because prices keep going up and up.  You don’t want to lose your shirt if you ever need to sell in a cooler market.  What are you to do?

First off, congratulations for thinking of the exit plan.  Any time you make a big financial decision, it is always good to have an exit plan.  Right now with so few listings, people are most concerned about finding a house and often don’t think about this step.

So, here are some things that will help ensure you will be okay in the future.  Be sure to do them in this order too….by the time you have gone through all of these, you should have a house that will be any buyer’s top pick regardless of the market:

1)  Stick with an established neighborhood.  Brand new neighborhoods are nice, but you never know what they will be like once they go through their first round of resales.

2)  Stick to a good location.  Location can really mean a lot of things in real estate.  Pick something that is convenient to somewhere.  Neighborhoods close to Hamburg, UK, downtown, the interstate, parks, big employers,, etc, all have appeal to a variety of people.

3)  Pick a neighborhood with at least average performing schools.  Sure, a lot of buyers really want excellent schools, but most of them seem to be just fine with decent ones.

Now that we have narrowed down the location, lets take a look at what to look for in the house itself:

4)  Pick a house that fits in with other houses in the neighborhood.  You don’t want that split foyer that looks like a half-timbered English cottage in the middle of traditional homes.

5.  Pick a house that is similar in size to most in the neighborhood.  You don’t want that 5000 square foot McMansion surrounded by 1200 square foot starter homes any more than you want to be the smallest house surrounded by bigger ones.

6.  Stick around the middle of the price range for the neighborhood.  The cheapest house in the neighborhood may be disappointing to a buyer who is expecting more.  The most expensive house in the neighborhood will leave a buyer feeling like the neighborhood is a let down.

7.  Go for a lot that is typical for the neighborhood.  It is okay to have a sloping yard if every other house does too.  Remember….nobody ever complains that a yard or driveway is too flat.

8.  As you look at the house, keep in mind that anything that is a big negative to you will also be a big negative to the next buyer.  Half bath riiiight off the kitchen bug you?  Backyard have no privacy?  These are things we called “Deal Breakers” in a slow market.  They will keep somebody from wanting your house when they have a choice of more than a handful of houses.

9.  If the house made it this far, buy it!

 

Old house/New house & my latest car

M3 S2

Cars and houses.

Those are my two things.  I can’t talk about too much else.  I don’t keep up with politics, pop culture or sports.  Get me on either of these two items though, and I am hard to shut up.

I recently added another car to my collection…..if you want to call a bunch of cars that aren’t old enough to be classics a collection.  Junk yard or used car lot is probably a more accurate term.

Sure, I’ve got a new car I use for work.  It looks good.  Is fast.  Gets lots of compliments.  But to me, it is sterile and generic.  It isn’t anything special because you can go to the dealership and buy one just like it.  I don’t feel anything but comfortable when driving it.

What gets my blood circulating is older BMWs.  I love the way they handle.  I love the way they look.  To me, the 90s-early 2000 BMWs were the high point for the brand.  An era I want to celebrate.

They don’t build them like they use to.

That is a phrase you often hear about older houses too.  Just like some people are into older cars verses new ones, some people also prefer an older house to a new one.  Old house people think all new houses are build poorly and lack any character.  The people who like new houses don’t want old house problems or floor plans that don’t work as well for today’s lifestyle.

Whether it is cars or houses, it is cool to like whatever you want.

As a realtor, the task at hand is getting in the mindset of your client and figuring out which they want.  When I buy a car, it is about what I want.  When I am trying to make a real estate love connection for a client, it is all about what they want.  Sometimes they don’t know yet and you need to help them figure it out.

After 12 years of doing this, I can pretty much tell if a client is really wanting to build a brand new house.  If you show them perfectly good move in ready houses and they don’t like any of them, they probably want to build even if they don’t realize it yet.   Another obvious sign is if their previous houses were brand new.  You would be amazed at how many people build a brand new house with each move.

The old house people will sometimes look at new houses, but they don’t like that the trees are small, or comment about the lack of character or perceived quality.  They walk in a perfectly good new house and don’t have any reaction at all.  It is just a structure with 4 walls to them.  Take them in an older house and they light up.

What do I like?  Both really.  In my dream world, I have an old house in a cool part of Lexington.  In that same dream world I have a super modern beach house.  The kind that is mostly glass.  In the garages of each place, I have a couple of older BMWs and also a new car because sometimes it is really nice to hop in a new car with really good air conditioning, comfortable seats and an awesome stereo with bluetooth.

 

Why NOW is the scariest market ever

I think right now is the scariest real estate market we have seen in a long time, for buyer’s at least.

I know, it seems crazy when prices are going up and there is a frenzy to buy any house as soon as it comes on the market……but that is what makes it scary.

When the market was so bad years ago, a buyer had their pick of dozens of houses.  They were able to make a good choice.  If the market dropped even further, you knew it would eventually come up.  You don’t have that luxury when you are at the top of the market.  You just hope it continues to go up more and more and more.  You never know where the peak is until it starts going down the other side of the hill.

I cut my teeth in real estate in the bad market.  Many people who did not use me as their buyer’s agent contacted me to sell their homes when times were tough.  Many of them had bought in the early 2000s when the market was hot.  They would tell me how they had lost several houses and they didn’t want to lose again so they bought the house they now wanted me to sell.  They’d say the market was booming so they didn’t think they could go wrong with a full price offer because that was the only way to get a house.  They were thankful to have even gotten their house.  The very house that at the time they were saying all this, had become a noose around their neck, preventing them from relocating for a better job, dividing families because one spouse had to start a new job while the other stayed behind praying the house would eventually sell.

The market they bought in was just like it is today.

While I don’t think we will ever see the market crash again any time soon, you know the market will go back and forth from being a seller’s market to a buyer’s market.

That is why I think being a buyer in today’s market must really make a wise decision.

Many buyers today, again, feel lucky to have gotten their house that backs to a business, is on a busy road, has a terrible lot.  They just feel lucky to have even gotten a house.  Period.  Many of them will call me when it isn’t as easy to sell because the agent that sold them the house is no longer in real estate.

I wish they’d call me now instead of using their uncle’s neighbor’s cousin’s babysitter who just got into real estate last month.

Here is what I would tell them:

“This market is tough.  There is no easy way to get a good house.  Yes, you will pay top dollar.  Yes, you may lose some houses.  Yes, you may even have to find temporary housing while we wait for a house that will be a good investment.  This market will cost you something-you can be burdened now and end up with a great house, or you can be burdened when you go to sell.  Whatever house you buy should set you up for your next bigger and better house.  You want to build equity to use as your next down payment.  You don’t want to have this house ruin your life should you have to sell in a buyer’s market.  So, let’s pick a winner that you will enjoy and that will be a solid investment for your future.  It isn’t going to be easy, but I am committed to making this happen for you.”

Real estate lessons from a bird?

Something happened in my yard yesterday that made me think about how important location is and why buyers need somebody with experience to guide them.

A robin built a nest in one of my bushes.  I have like 50 bushes in my backyard.  This poor robin picked the one right by my backdoor.  And she built it about 2 feet off the ground.

I am sure she thought it would be great to be over there by the dryer vent on these cool spring mornings.

She worked hard building a really nice nest.  It was a great place, she thought, to lay her 3 eggs.

If this robin had asked me, I would have told her I have a dog.  I also would have told her about the neighbor’s cat named Stewart that walks down the fence several times a day.  Stewart is the reason my wife can no longer feed the birds.  Our feeder area became an all you can eat buffet for that stupid cat.

Had she asked, I would have suggested one of the taller bushes at the back of my yard, on the far side of where Stewart cuts between my house and my neighbor’s house to get home.

But there are no realtors for bird houses.

You probably see where this is going.  My dog knocked the nest out of the bush and the eggs fell to the ground.  I can’t really blame my dog for being a dog, but we were looking forward to watching this robin’s journey to motherhood.

When you are buying a house, there is a lot of stuff to process.  It is easy to focus on what you like and assume you are seeing the whole picture.  Even more so when you have to make a quick decision in a fast moving market.  I always try to make sure my clients know everything I know about a location or house.

Some things I’ve told clients:

“I know you like that this house is right across the street from the school.  Between 2:05 and 2:50, there will be 500 moms parked in idling SUVs and minvans in front of this house.  Will that bother you?”

“I know you don’t mind that this house is on a busy road.  I know you’ll have 3 teenage drivers in the next few years.  I wanted to make sure you realized that they won’t be able to park on this street and this driveway is only one car wide.”

“I know this is a great house and any house will sell fast in this market.  I think that only having two bedrooms upstairs and the rest in the basement will make this house harder to sell in a soft market.”

I couldn’t do anything to help this robin, but I can help you pick the right place to live.