Questions From You
But Zillow says my house is worth…
July 18, 2011 by Sasha C. Farmer, REALTOR ® · Leave a Comment
It is actually quite often that people I run into have been completely misguided about their home values. With the incredible technology and information online about real estate and home searches, people often feel that real estate websites are getting to the point where they are extremely accurate and reliable. In some large cities, evidently this is true. In Charlottesville, there still seems to be a huge void between what these websites predict about our real estate values and local market, as compared to market reality.
Zillow and Trulia seem to be the two biggest offenders when it comes to this as they offer automated home valuations that people like to use to predict their home values from year to year. Zillow’s Zestimates seem like they are based on enough data and information that they would at least be able to give you a reasonable range within which you could expect your home price to fall. However, that does not often seem to be the case.
According to Zillow themselves, almost every market area in Central Virginia has an extremely low accuracy level- check out the charts below that they provide to set your expectations!
Their self-reported accuracy level is extremely low (almost all nearby counties are a 1 out of 4 star rating) and I can absolutely attest to that!
All that being said, please do not let automated estimates of value set your expectations about your own home or homes you may be interested in buying! If you need pricing analysis and recommendations, please consult with a real estate professional- ideally me! – for guidance.
Is Now a Good Time to Buy?
October 5, 2010 by Sasha C. Farmer, REALTOR ® · 2 Comments
Time Magazine’s September 11 cover story attempts to make a strong case against homeownership in the article found here; but I have actually found my recent conversations with clients (current and pending) to present a story that is quite the opposite.
Are you still debating whether or not it is a “good time to buy”? It is never a good time to buy for EVERYONE, but right now is a GREAT time to buy for many people, and I hope the naysayers aren’t swaying people away from making a decision that could very well be right for them. If you have income/job consistency and plan to stay in the same location for 5+ years, this may be the best time to buy that we’ll see in this lifetime. In Charlottesville, we have excellent selection, competitive prices, and we’re seeing the same low interest rates that all of these experts mention.
Here is an interesting article from Steve Harney, a real estate expert who has stayed abreast of the current real state market and seems to do a good job reporting on it fairly.
“If you don’t own a home, buy one. If you own one home, buy another one. And if you own two homes, buy a third and lend your relatives the money to buy one.” – John Paulson 9/27/2010
WOW! That’s a powerful statement.
There is no question that John Paulson is a bull when it comes to residential real estate right now. Should we care what Mr. Paulson thinks? Should we listen to him? The answer to both questions is a resounding ‘YES’. Here are several reasons why.
Who is John Paulson?
Paulson is the person who made a fortune betting that the subprime mortgage mess would cause the the real estate market to collapse. He understands how the housing market works and knows when to buy and when to sell. What do others think of Paulson?
According to Forbes John Paulson is:
a multibillionaire hedge fund operator and the investment genius who made a killing going short subprime mortgages a few years ago.
According to the Wall Street Journal Paulson is:
a hedge fund tycoon who made his name, and a fortune, betting against subprime mortgages when no one else even knew what they were.
What did other financial players think of his statement?
The Wall Street Journal agrees with Paulson:
Ignore the critics. The odds have to be on his side…It isn’t just that home prices have fallen a long way. It’s also that, if you can get a mortgage, you are basically taking a reverse bet on the bond market. You could be a long-term borrower at fixed rates, instead of a long-term lender. Right now you can borrow for 30 years at around 4.3%. After the mortgage tax deduction, for some people the net effective interest rate is nearer to 3%. That’s going to prove an awesome deal if we see inflation again.
And Forbes said:
As this is the best time in 50 years to buy homes, Paulson advised his listeners to take 30 year mortgages to buy a home as “your debt and interest payments get locked in at record lows, while the price of your home will rise.”
Are others also saying now is the time to buy?
Just last week, we posted that there is a growing number of people saying that NOW is the time to buy, including:
- The Wall Street Journal
- Professor Karl Case, founder of the Case Shiller House Pricing Index
- The wealthiest families in the country and
- 70% of everyone else in America
Bottom Line
Thinking of buying a home? Are you taking advice from a friend or family member telling you that now is not the time? It may be time to listen to people who better understand the opportunities that exist in real estate today.
via If HE Says It Is Time To Buy a Home, BUY A HOME!.
I hope that if you’re considering purchasing a home, you will give me a call or shoot me an email to discuss your options and take a look at whether or not buying a new home in Charlottesville might be the right decision for you!
Does all this snow hurt my lawn?
December 28, 2009 by Sasha C. Farmer, REALTOR ® · Leave a Comment
I have had several clients ask about the damage that our recent snowfall is doing to their land. I am definitely not the expert on this, but found a really helpful answer on Turf King-Hamilton- Lawn Care.
Some plants will benefit from a little extra snow during the winter. Snow around the rose bushes will provide some insulation from the sap-chilling deep freeze of this past week. Bitterly cold temperatures for prolonged periods of time will result in more roses biting the dust this winter.
On the lawn, a thick layer of snow will not harm it, provided that there aren’t leaves left on the surface. The snow and leaves combine to prevent air from the foliage. This is likely to lead to accumulation of water under the leaves which in turn will lead to putrefaction. If the grass is cut short in the fall, the lawn is less likely to get diseased by the longer leaf blades being smothered. The last mowing should always be a little shorter. (the problem I’ve had is that autumn doesn’t seem to know when to quit, and I end up with 2 or 3 last cuts. Don’t cut the lawn too short of course, as this makes it more susceptible to frost damage if there is little snow.
Grass that has been cut too short, on the other hand, is susceptible to frost damage.
If you walk on the lawn regularly during the winter, it is also advisable to remove the snow from these paths. Snow that is hard packed by foot prints on the lawn could lead to damage to the grass plants. (it could also lead you down a garden path)
[From Turf King- Hamilton- Lawn Care: Does all this snow hurt my lawn?]
I would love additional input on this from anyone with first-hand experience. Unfortunately my lawn probably won’t even notice the difference!
How Much Will A Short Sale/Foreclosure Hurt My Credit?
December 23, 2009 by Sasha C. Farmer, REALTOR ® · Leave a Comment
I have had a couple of people over the past few months mention that they may consider a short sale, so that they can just get out from under their homes and move on. While the ramifications of a short sale or foreclosure seem to be getting slightly more lenient in light of all of the predatory lending that has occurred in the past several years, they are still significant.
Here are some general credit score ranges (as provided by the National Association of Realtors CRS Course 111);
- 990: highest calculable credit score.
- 900: 15% of borrowers have a credit score at 990 or above.
- 740: a rough number around which people are usually able to get a good, competitive loan.
- 680: the average credit score.
- 501: lowest calculable score.
- 500: 18% of people have a credit score of 500 or below.
Let’s imagine that you have a credit score of 740 and own your home, but are having trouble making your payments (which may actually be causing your credit score to drop in the meantime). Here are a couple of different options, and their effects;
- A loan modification is said to have no negative impact on credit score.
- A short sale is estimated to impact your credit score between 120-130 points.
- A strategic default will likely impact your score by 140-150 points.
- A foreclosure is said to impact your score by 200+ points.
- Filing bankruptcy is likely to impact your credit score negatively by 355-365 points, putting even most prime borrowers below a score of 500. We are being told that it is still remaining on credit scores for up to 10 years.
Another crucial point to remember is that Virginia is a recourse state, which means that a short sale or foreclosure debt that is not forgiven by the bank, can be pursued later. This may result in credit collectors calling on you for years to come, to collect any remaining debt owed.
Let’s do what we can to help you avoid either of these results if possible. A really interesting fact to be aware of; According to the 11/03/09 issue of USA Today, only 9% of eligible homeowners have had their mortgage modified. There may be better options for you than a short sale or a foreclosure.
**Disclaimer: I am a licensed real estate agent and cannot provide legal consulting or tax advice. For counsel on either of these things, please consult your tax accountant or attorney.
Before making any decision to pursue a short sale, a foreclosure, a strategic default, or to file for bankruptcy, it is in your best interest to consult with a licensed Realtor, your tax accountant, and an attorney.
