Tales From The Trenches in Northern Nevada Real Estate

Tales From The Trenches in Northern Nevada Real Estate

Frustrated or confused in this market? Consider some of these recent experiences, all true stories. Think your lender is giving you fits? How about this one – A couple was looking to refinance their home to take advantage of the new low rates. They were seeking $100,000 on an appraised value of $360,000, 28% Loan to Value. Their credit scores, husband and wife, are 840 and 820 (not a typo) respectively. They were turned down. Why? The stated reason is because they are tearing out their deck and replacing it with a patio, and they used two pieces of siding on their expansion that didn’t match the rest of the home. This is the same asset that the company is already using to secure a higher rate loan. True story. Think the lender didn’t want to give up a higher rate loan? They are appealing to upper management and to their Senator.

We had a Buyer write full price on a bank-owned property. Excellent agent on the other side, no problem, right? Fourteen days later the madness continues. Some adventures along the way: Lender countered with 10% down to a Buyer that is getting a 100% loan. The next Counter they allowed the 100% loan, but said the transaction wasn’t conditioned on the Buyer getting a loan. The last go ‘round included the bank removing the agents’ selling fees. Sound like the asset manager was punching the wrong buttons on the portal, or simply didn’t know what he was doing? Either way, the Buyer has been on an unnecessary roller coaster ride.

We wrote full price on another bank-owned property. They countered one item because “they had to” – the close of escrow. They extended it from 15 days to 30-plus. The Buyers went along and we proceeded. A week later the bank started requesting an early close. They had it to begin with, held up the acceptance to counter with an extended closing, and then reversed their course. This after they took days to accept and then demanded acceptance within 24 hours. This last item is very common these days with bank owned properties.

Then there’s the ex-wife that won’t sign docs for a short sale. Refused to cooperate. She recently went to buy a new home and is running in to problems with her loan because of the late payments on her old home that the ex got in the divorce. They could have been minimized if she would have cooperated 9 months ago when he was current but struggling! She’s threatening suit on the ex-husband because he couldn’t make the payments after he lost his job. Remember, they bought the house on both of their incomes, he now has zero income. Hmmm – what’s a judge to do?

Our Advice: These are just snippets of what’s going on around town. There are many, many more examples that are simply jawdroppers. Hard to believe, but it is the reality and must be dealt with. Whether buying or selling, it more important than ever to have a good seasoned agent to help you navigate this tumultuous Market. It is important to stay calm, stay focused, and proceed to your objective. Things are really quite exciting right now and you can be a part of it – just be ready for surprises.

Keep your eye on your goal and don’t get emotionally wrapped up in the brushes of insanity you’ll experience along the way. Make sure it doesn’t rub off on you and you’ll be just fine. The end game is what counts for you and your family – remember that as you laugh at the ludicrous scenarios that unfold before you and you’ll have fun while you succeed. A good way to live.

When it comes to choosing professionals to assist you with your real estate needs… Experience is Priceless! Lisa Wetzel & Jim Valentine, CDPE, SFR, RE/MAX Realty Affiliates, 775-781-5472. carsonvalleyland@hotmail.com, www.carsonvalleyland.com

My Agent Won’t List My House At My Price … Why?

Sounds like you have an astute business person for an agent… congratulations. We have often discussed the agents that will list at any price because they are either: a. ignorant and thrilled to finally have a listing to work on, or b. they are going to take the listing and beat you up week after week for a price reduction. The smart agent knows that an overpriced listing won’t sell, and ultimately it will have a detrimental impact on the Market and the property itself.

The matter is actually more involved for the savvy agent, the good business person that understands not just the mechanics of the industry, but the fact that it is, indeed, a business. Despite the perception of the uninformed public that all a listing agent does is put a sign in the ground and put the property in MLS, there is a lot more to it. When a homeowner signs a listing they agree to pay the agent a selling fee when the agent has performed … not just procuring a Buyer, but actually closing the escrow with the Buyer.

When an agent lists a property they are committing to a substantial financial investment. In our particular market area, Northern Nevada, Just taking a listing actually costs the agent around $2,000 of hard money… without the extra stuff. Then there are ongoing monthly carrying costs in the neighborhood of $400 per listing. That figure will vary according to how many listings the agent carries and what his monthly operating costs are, i.e.- if an agent has ten listings and a monthly base cost of operation of $5,000 his monthly cost per listing is $500. If it takes six months to sell your home, a neutral market (not Buyer or Seller), the carrying cost is $3,000. The agent’s cost is now $5,000 without a guarantee of any return. If you have a $300,000 home and their side of the fee is 3% they will gross $6,000. Now you know that the net is only $1,000 for their personal expenses, i.e.- taxes, house payment, food, utilities, recreation… life.

Some agents might take a listing for the sign placement if you have a highly visible property. That is an old school thought for there are fewer sign calls these days with the proliferation of the Internet in our industry. If your agent is taking the listing too high you might be an unwitting victim … and so is the agent. They are only fooling themselves as to their actual benefits of the listing, and they aren’t serving you well.

Our Advice: Even in a traditional office where agents don’t pay as many direct costs, they still pay as their broker receives a larger portion of the selling fee. Many agents, regardless of their fee-split arrangement, don’t know they are in business. Be careful with such an agent when considering them to list your home. If they can’t manage their own finances properly how careful will they be with yours… your money… when it comes time to negotiate on your behalf and to protect you through the escrow process that is fraught with financial traps?! There is no “let’s just try it”, or “they can always make an offer” since marketing times have gone from a week to nine months on average. The costs and risk are just too high to put your hook in the water on a whim.

An agent must protect your property and investment as well as their time and financial expenditures when they take a listing. The art is to price it right – to get you the most possible in a reasonable period of time. Experience is Priceless! Lisa Wetzel & Jim Valentine, RE/MAX Realty Affiliates, 775-781-5472, carsonvalleyland@hotmail.com, www.carsonvalleyland.com

It's Great to Live In Northern Nevada!

You mention that our market will recover in the future … how are you sure?

We believe that the reasons for the “discovery” of the Carson Valley as a wonderful place to live will continue to attract people wanting to move here and enjoy it on a daily basis. The local natural beauty is a joy every day – whether a beautiful sunset or a raging storm boiling over the mountains – it is simply gorgeous. We are ideally located in relationship to other Western States and we have a true Western mindset in our community – better yet - a Nevada mindset.

Our biggest faith for the future of our community, however, is the people. We believe the people of the Carson Valley are one of its biggest assets. A close look at the goings on around town reveal a consistent giving nature in the population. Traffic backed up and heavy – there’s the guy waving you in from the side street. Animal on the road – people will nearly wreck their car to save the animal and will cause a traffic jam while they get the animal to safety.

We were awakened at 5:00 a.m. last Sunday morning by the doorbell. It was our neighbors, Paul and Sue Brunnelle, telling us the sheriff’s office had called them reporting that our horses were out. Great! It was dark. It was eighteen degrees. Did we say it was five in the morning? The problem – we couldn’t find the horses in the dark. The neighbors didn’t just go home and get back in bed. No, they drove around looking for the horses, located them down the road eating another neighbor’s lawn, and helped us walk them home. All the time with a smile on their face and reassurances that we would find them that cold dark morning …It’s the people!

A few weeks back one of our neighbor’s replacement dairy heifers was out and on a busy road. A caring couple stopped to tell us, and we all went out to help the scared animal. It was nice to see all the cars, a busy road at a busy time, stop … and the drivers smile … understanding the situation. People also “stop” in the Carson Valley to help individuals and families in need … whether from health, accident, or life circumstance misfortune. The Carson Valley takes care of its own … every time. It is a true community of great people that let you live your life without intrusion, and rally to help those in need - whether animal, child, or family - when needed.

Our Advice: Real estate values will always fluctuate, but what is important in the long run is that the integrity of the Valley remain intact so the lows are higher and the highs dependable. We are confident that the People of the Valley will see that it does. The quality of life that is so dear to those that live here … and those that want to live here … is essential to the overall real estate values. There is no doubt that it will, in time, serve to protect local real estate investments … including those made in 2005, 2007 and 2008. Have faith … in the people.

Buy now with confidence. The many reasons you want to live here are exactly why your Carson Valley real estate investment is safe.

Experience is Priceless! Lisa Wetzel & Jim Valentine, RE/MAX Realty Affiliates, www.carsonvalleyland.com , 775-781-5472.

Where Have All the Buyers Gone?

We’re on the market but aren’t getting showings … where are the Buyers?

Our initial response is to address your price … are you priced right? That is elementary and essential. Assuming your price is right let’s look at today’s Buyers. Buyers today are very informed. They generally know the market, what is going on in the community, what is going on in the financial/lending world, and the many other factors that can affect market dynamics. This information is available on the internet, in print publications, and other media. They know what is happening so-o-o … “Where are the Buyers?”

There are Buyers actively shopping and making offers to buy. Their quantity is not what it was a couple of years ago, and there are many, many more properties available for them to buy. What is changing is where people are buying. When the Carson Valley real estate got too pricey a few years back people went to Dayton for affordability and investment opportunity. As Dayton got priced up they went to Yerington. As the prices came down this scenario unwound, the Yerington market slowed, Dayton slowed and they came back to the Carson Valley which is now quite affordable.

It doesn’t end there. Our market has been driven by people moving in from out of state, primarily from California. For some time we’ve waited for those people to sell their homes thinking that their slow market was causing our market to stall. Now we are seeing some of those markets so price decimated that the need or desire to buy in our market isn’t what it was. Investors that were investing in Northern Nevada can buy properties in their local market in the $300,000 range that were in the $500,000’s a few years ago. They are investing locally. Likewise, people that wanted the lifestyle of a $500,000 home, and were coming to Nevada to get it can stay home and achieve it today without moving to Nevada. Those coming for tax relief? Most people in the $300,000 price range aren’t that dramatically affected by the Nevada tax relief and many are now staying home.

Our Advice: If you are determined to sell in this market … price it right. There is no substitute. Your agent can’t buy an ad big enough to overcome improper pricing. Look ahead – where are you going and what will selling your property do for you. The market will change in time – it is up to you to decide if you are going to wait for it, or act now and achieve your immediate real estate goals. Don’t be hung up on price or value – it is your position in the market that counts. That will get you where you’re going.

Be aware of where you are positioned in the market. The Buyers know your market position… which may be why you aren’t getting showings.

Experience is Priceless! Lisa Wetzel & Jim Valentine, RE/MAX Realty Affiliates, www.carsonvalleyland.com, 775-781-5472. Email us at carsonvalleyland@hotmail.com

Selling Smart in Today's Market

How in the world can we be smart in today’s market?

Everyone wants to be smart in their real estate moves. Really, most just don’t want to be dumb. Unfortunately, many are now considering non-action for action and are hiding behind the mantra of, “We’re not going to give it away!”

It isn’t that kind of market, folks. Consider what the Chief Executive of Countrywide Financial, Angelo Mozilo, the Largest U.S. mortgage underwriter, said on July 25th, “No one saw the deterioration of real estate values coming.” He went on to say, “The Company is seeing home price depreciation at levels not seen since the Great Depression.” If you still can’t adjust your expectations to reality, or if you are wondering why you weren’t told about this think about the above statements. The number one man of the largest mortgage company in the nation says they didn’t see it coming. Don’t fault yourself, or your agent – take action now.

We’ve recently seen amazing Seller resistance to price adjustments in all market segments. It has been frustrating for agents offering professional insight and perspective to Sellers in denial. The results are numerous agent “firings” of customers. This is when they give back the listing because they feel they can’t get the job done at the List Price in today’s market. Given that Mr. Mozilo thinks it will be mid-2008 or even 2009 before things come back, it is important to evaluate your situation with brutal honesty. Listen to your agent.

Our Advice: Quit worrying about what your property was worth in 2005 – that was then. Don’t scheme about how you can take advantage of an unsuspecting out-of-state Buyer – Buyers are smarter now and nobody pays too much in this market. If you have an opportunity to replace your residence with something equally affected by the market as your present property – sell and buy and get on with your life. If you have health or family issues that are affecting your need or desire to sell – price it right and get on with your life, prioritize right between money/health/family and your decision should be easy. Don’t try to fool your agent into believing your value story – if they believe you then you haven’t selected the right agent to work for you. Your agent must take a risk right now. Your agent must tell you what you don’t want to hear … the Truth. The risk of disappointing you now greatly outweighs the risk of really disappointing you in six months. The good ones will take that risk to serve you professionally – it’s up to you to listen and take action.

Property is selling … at interesting prices. Yours can sell – when you remove the blinders and have an honest look at where you fit in today’s market. Buyers are “pricing forward” in their offers – something Sellers were doing not too long ago in the other direction. If you don’t have to sell now … don’t!

When it comes to choosing professionals to assist you with your real estate needs… Experience is Priceless! Lisa Wetzel & Jim Valentine, RE/MAX Realty Affiliates, www.carsonvalleyland.com, 775-781-5472.