What neighborhood is the winner in this market?

Masterson.  Formally know by it’s full name, Masterson Station.  While the whole neighborhood has seen values really go up, I think the true winners are the single story homes in the 1000-1350 square foot range.

Many many years ago, half of Masterson was in foreclosure.  That happened to a lot of the newer neighborhoods where the first owners bought at the top of the previous hot market with sketchy no money down loans.

I remember I would often spend ALL day with first time buyers just in Masterson when the market collapsed.  I would schedule 8-10 houses, all just blocks apart.  It would get confusing after a few.  I would find myself saying stuff like “This is the Roxbury plan by Schneider Homes.  It is the same floor plan as the 2nd, 3rd and 6th house we saw earlier, only this one has blue vinyl in the kitchen instead of tan, and it has a deck instead of a patio…..oh, and this one has a fenced back yard too.”  Then my client would say something like “I thought the 2nd and 6th house were the two story houses?”  Then I was like “No, it was the 4th house that was the two story.  It was a Ball Home plan.  The Fairfax is the name I think…..yes, that is it.  The Fairfax is the one I told you about that sometimes has an open loft instead of the 3rd bedroom, and realtors often call that a 3rd bedroom because they know nobody will come see it if they said it was REALLY a 2 bedroom house.”  Then my client would ask “What was the 5th house?  I don’t even remember it!”  I’d reply “The 5th house was the only occupied house we saw today.  The water was on and we both used the restroom.”  Client be like “Oh, I remember now. How do you keep all this straight?”  And I’d be like “It is taking every bit of concentration I have.”

Back then, $125k was like $155k is today.

Then the market improved.  I was amazed these houses were selling around $130k.

Then it got better.  I started seeing a lot of $140k houses a year ago.

Now a decent one is $150k, some are even higher!

That is a huge turn around from half the neighborhood being vacant houses that took 6 months to sell.

 

What was I thinking in 2011?

Every once in a while, I like to look through old blog post drafts that never got published.  Well, today was one of those days.  I wrote what is below on 12/29/2011.  The day after my anniversary.  Now, I have no specific recollection of either day in 2011, but I have been married long enough to know that it makes your wife feel good when you can reference your anniversary date…..so that was for you babe!

A lot has changed in nearly 6 years.  All of today’s first time buyers would be amazed that they could have picked from 50-100 houses in their price range back then.  Today, they may have 4 listings on their preferred side of Lexington in their price range.  I remember spending many full days where I never left Masterson Station because there were soooo many houses for sale.  Buyer’s would get confused.  They couldn’t remember one house from another.  I would say stuff like “This is the same floor plan as the 2nd, 5th and 9th house we saw earlier, only this plan is reversed and the vinyl floor in the kitchen is blue instead of brown.”

I had to laugh when I read the draft below because now I have people looking for deals and there just really aren’t any these days.  Also, today the challenge is finding ANY house for a buyer whereas back then it was about helping people pick the needle in the haystack.  Selling listings today is like shooting fish in a barrel.  In 2011, getting a call from a potential seller made your palms sweat because you weren’t sure it would sell.

Here is what I was thinking about late December in 2011:

 

When I was a kid, that Kenny Roger’s song was popular.  You know, the one that said “You gotta know when to hold ’em.  Know when to fold ’em.  Know when to walk away.  Know when to run.”  It was about gambling, but it could just as well be about being a realtor.

Each deal is different.  The people are different.  The house prices are different.  To get the best deal for a client, you have to be able to analyze a bunch of different factors and figure out how something is likely to go down, then take action.

Several months ago, I wrote an offer for a bank owned property.  It was rather unique. They countered our offer, but it was still way too far outside of anything remotely realistic.  We politely said no thanks.  My investor client and I both thought that the time of year, the market, and the ability of other investors to borrow money meant that there really wasn’t much of a market for this property other than him.  We also suspected that the bank would soon want it off their books.  We knew when to “Hold ’em” basically.

Not too long ago, the bank came back and agreed to our original terms.  We’re still working out details, but I’m pretty pumped that my buyer is about to practically steal this property.  Think I’ll buy that song on iTunes and listen to it on the way to the closing…….or that Tom Petty one that says “The waiting is the hardest part.”

LEXpert flashback: When I was a volleyball star

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I listed this little cabin in the woods last week.  I normally don’t go this far out of Lexington, but it was for a past client.

Then I got to thinking that this client, who has used me before, came from another past client, who came from another past client, who was referred from my cousin….so THANK YOU Ashton!  This cabin will be the 11th sale from one referral.

I love it when people refer their friends and family to me.  See, I was never good at sports or anything.  I was always the last or second to last person picked in gym class.  It was either me or a guy named Brian who had an equal amount of sports aptitude…..unless the game was volleyball.

Everybody wanted me on their team for volleyball.  Not that I had any talent in spiking the ball, or even hitting it really.  My special talent was serving.  I could serve the ball and every time I did, we scored a point.

I was always scared to death that they would realize my secret.  I would have all these anxious soundtracks playing in my head like Kevin from “Wonder Years.”

“Will they realize my secret?”

“What will happen if they do?”

“I don’t want to be picked last again!”

Since I probably won’t be playing volleyball competitively again, would you like to know my secret?

I’m left handed.

About the only place in school being a Leftie paid off was playing volleyball.  All those right handed people would serve and the ball would go to the same place.  The opposing teams just got use to the ball being served there.  When I served, it would not go diagonally, but straight, and usually to the back row where the players were least prepared.  I am just glad I was with a bunch of middle school kids who were too preoccupied with pimples, staring at Tonya Jones, or perfecting their moon walk…..because nobody ever figured out that my serve went somewhere differently.  Not once did anybody realize this for all 3 years.

It sure was nice to be the top pick every once in a while back then.  It is even nicer to be the top pick for returning clients and for those who have been referred to me.

 

How my 4 houses helps me understand move-up buyers

My first house.

7 Ky Street

 

I loved everything about it.  It looked cute.  The mortgage was cheap.  It had two original fireplace mantles.  It didn’t bother me that it didn’t even have a driveway, or that there were some houses nearby that had been converted into cheap apartments.  It was my first home.  The threshold was low and I was happy.

 

My next house.

New outside

 

It was really a dump when we bought it, but I was so happy to have a garage, a master bathroom and to be the trashiest house on a nice street verses the best house on a trashy street.  I quickly grew to hate the trek from upstairs to the garage when I would take my kids to school, and the awkwardness of the split foyer design when people would come over.  The threshold for happiness was still low since having more space, that garage and my own bathroom were enough to get me excited.  It was better than the first house and that was enough.

 

My next house.

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This is the one where we started getting more picky.  Doing things like wanting to know if any houses around it were rentals, checking out the pantry and school districts.  The first house was better than renting a house.  The second house was better than the first.  That type of thinking wasn’t going to cut it on this move.  I loved living here, although there was no storage or anything.  Also, I was told that my lot was the gravel pit for the neighborhood, which is why the grass never looked good in the front yard.

 

The current house.

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We weren’t going to settle as much this time.  We looked and looked and looked at many houses.  The yard had to be flat.  There had to be more storage space.  The kitchen had to have a better pantry and more counter space.  The previous houses were more about finding a house we liked.  This one had to be in a certain part of town.  We didn’t have to move.  We wanted to move……which gets me to the point of this post.

And that point is that buyers who have owned several house and are now looking for their pinnacle house, the one they will live in before they start downsizing, are pretty picky.  And that is okay.

These buyers have lived in enough places to know what they want and more importantly, what they don’t want.  They know what they can compromise on and what they can’t.  The gray area that was okay for previous houses is gone.  There is no “Well, maybe that won’t bother me as much as I think it will.”

 

My next house??

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Maybe something like this.  I love windows.  I love looking out and seeing leaves blowing in the wind, and clouds, and birds in the air.  I want to feel like I am outside even when I am inside.  I want it bright.  I want a view.  Of something.  Trees, water, anything other than the back of my neighbor’s house.  I want to feel inspired by the architecture of my next house.

And the next house will probably be at the center of many posts about downsizing and empty nest buyers.

 

Will technology make Realtors obsolete?

Many people seem to think realtors are going to be replaced with a bunch of apps on a phone.  I don’t see it happening, but changes are bound to come.

I can see a day when, instead of touring several houses in person, buyers use virtual reality to narrow down the ones they want to see.  I am sure any buyer will still want to see whichever one they pick in person before signing a contract.

I can see sellers and technology doing more on the listing side of a sale.  I can see more for sale by owner listings and various businesses popping up to help sellers navigate the process alone, but I don’t see the same for buyers.  Buyers will always want help from a pro.  The seller is dealing with one house, their own.  The buyer is dealing with making a wise decision.  Artificial intelligence won’t ever replace the voice of a pro.

I can see a day when there are far fewer realtors than we have now.  The lame ones who don’t do more than open doors, fill in blanks and who just tag along to get their check will go first.  All that will be left are the really good ones.  We’ll make less per transaction, but each transaction will take less time.

I can see a day when a realtor hardly has to see their client in person, or actually go in many houses.

What I can’t see is there ever being a day when people don’t want a realtor.  People will always want a real live person to help them navigate through something they don’t understand, or when they have a problem they can’t solve.  Don’t believe me?  Then why does Apple have live people to help their customers when all the self guided trouble shooting tips don’t help?  Also, short of new construction, no two houses are alike.   People are always going to want to see a house before they buy it.  It is something most people do only a few times in their lives.  They are concerned about resale potential.  This isn’t like ordering a pair of shoes online where you will wear them and then dispose of them when they are worn or out of style.

I am sure there will be things I welcome as real estate evolves.  There will also be things I miss.  Until then, I will just keep doing my best for my clients and laughing every time I read an article that predicts I will be replaced with an app.