Audrey's Adventures in Real Estate

Do you think we will ever learn?  I don't.  You know, when something is going gang busters, you throw money at it and you make money that blows your mind and makes you laugh all at the same time?

I say STOP all the doom and gloom on television.  They have no clue what they are talking about.  Yes, are the banks screwed up, sorry but most of that is their own fault.  Well, this post is not about that and I am not going there right now.  We are at a normal price range for the most part in my area!!!

Do you really think that 40% a year is normal appreciation??  Take that for 5ish years in a row???  Is purchasing a home $100,000 over the asking price with no appraisal contingency via an escalation clause, normal??   You know in your heart your house, or any other, was NEVER REALLY worth what it topped out at??  I know you will argue supply and demand, I will just say BS, and then I will say Dot Bomb right afterward.  Remember, we never learn our lessons.   Do you REALLY think that it would go on forever???  Hello???  Our incomes could not keep up with it.  People would say, I bet you are making a killing right now selling real estate?  I would say sure, but it evens out for the slower years we are not as busy.  It is called a market for a reason.

So what goes up, must come down, right?  Why is it that 40% appreciation, or whatever your number was in your specific area was, was considered "normal", but 40% depreciation is abnormal??  Maybe "normal" is the wrong word?  Maybe "Acceptable" is the word I should use?  The point I want to make is that if we would have not gone on the roller coaster ride of market values we have just been on, our values would be where we are right now anyway.

For the sake of argument I am going to do a little comparison for you to show you that we are now at a "normal" market value.  Now, I am not a fancy graph maker, so here it is going to be in black and white for you.  I will call Altos Research later to make me some graphs. 

So Let's pretend the real estate boom didn't happen and we had steady growth.  Where would the numbers be?  We will use my first house I ever owned as the comparison.  I loved that house, much bigger than it looked and I fixed it up beautifully.  If we use 8% appreciation, which is a number financial folks will use with you for your investment accounts for steady appreciation of your stocks and bonds.  So let's use 8% for the sake of this exercise.

In 2000 I sold my house for $200,000.  Thought I stole every dollar from those folks. It topped out at $450,000 in 2006.

Let's just use my 8% and see where this exercise goes.

2001  $200,000 x 8%  =  $16,000

2002  $216,000 x 8%  =  $17,280

2003  $233,280 x 8%  =  $18,662

2004  $251,942 x 8%  =  $20,155

2005  $272,097 x 8%  =  $21,767

2006  $293,386 x 8%  =  $23,470  BTW, it sold for $400,000 that year.

2007  $316,856 x 8%  =  $25,348

2008  $342,204 x 8%  =  $27,376

2009 = 369,580.

Do you know what the exact same floor plan in that neighborhood sold for in October of 2008?  With prices going up and coming down?  The same model as mine sold for $351,000, plus the seller paid $5000 towards the purchaser's closing costs? 

Basically the same as the value that I show you in 2008???  The $342,204!!!

Try this experiment on your house or an area that you know really well and see if the 8% appreciation and today's value are close?

So why don't we just stop thinking the values are so bad, they are more normal now, people can actually afford their house payments the old fashion way, with principle and interest!! 

Yes, this is not good news if you purchased your home in 2006 and are trying to sell your home now. 

This post is not about that, it is about steady appreciation.  I know that is too simple and perfect of an a example, but maybe one year would have been 5% and another 12%?  We are talking averages.

Maybe we should change the way we are thinking about our market and start to think it is a normal market?  Get rid of the doom and gloom, let's dust our butts off and move forward.

For more information, contact Audrey June- Forshey RE/MAX Reatly Group 301-938-8028, 

 

I was never a Dead Head, I just didn't get it,  but many of my friends were.  Come Summer time half of my friends would vanish?  Someone would say, where are Vicki and John?  Then one of my other friends would say, The Grateful Dead are on tour.  We would all say aahhh nodding our heads. 

A Dead Head Was a person that would go to great expense to follow the Grateful Dead around from Concert Venue to concert venue.  Own their own personal wardrobe of tie dye T shirts and can tell you exactly where they were and what they were doing the moment they heard Jerry Garcia passed away.  Actually, I can tell you that, but I don't know all the words to all of the songs.  It is kind of a religion?

Vicki and John would, I kid you not, to the grocery store before a Grateful Dead concert and buy a couple loaves of bread, mayo, cheese and lunch meat and sell food at the concerts.  That was how they would make the money to pay for their gas and tickets to the next Grateful Dead concert in the next town.  I think they had some set up with an ironing board and an iron to make grilled cheese sandwiches, but I never understood where the electricity came from for the iron?  Anyway, they would be gone for weeks at a time just having fun at Grateful Dead Concerts going across country.  This was a pretty big phenomenon back in the day, not exclusive to Vicki and John.

I never got it, but loved all of their stories.  They always came home with the coolest stuff, T-shirts, huggies from other people.  I think they even had someone else's clothes one time- I have no idea what that person wore home??  I think I missed out?

This got me thinking, I think we social network 2.0 people are the Dead Heads of our time??  Think about it?

I saw all of the posts about the NAR convention back in October. The Technology classes that were being taught  there and I thought it looked so informative and fun at the same time. I had to go to one of these things!  I saw pictures of all the Blogging Technology gurus and the groupies that follow.

The other day I was talking to my friend Jeff Belonger.   We were talking about loans and if our friend Pat Kennedy and I were going to make it up for the Philadelphia AR Gathering?  Neither Pat, nor myself made it up the road, work and other obligations kept us away, but we considered driving to Philly from DC for a gathering.

Pat and I, among our other AR, Twitter, Facebook Friends were up in New York for a short time for the Inman NY Conference with C Tann Starr - the coolest chick ever.  I met Brad Andersohn, holy smokes if you could just bottle all of that energy!! I went up to NYC with Meyer Leibovitch - just for the day.  Everyone was having such a great time.  They all got to meet each other IRL!!

Jeff asked if we were going to the RETech South conference in Atlanta.  I told him no that I was going to the VAR REBarcamp instead.  Jeff said he thought he would try to go to Chicago and may San Francisco to their REBarcamps and I think there is an Inman Conference there as well?  I have to check schedules. 

I really am checking all of these schedules so I can see which one of my friends will be attending or speaking at each event, but I am considering buying a loaf of bread and some cheese to sell sandwiches so I can pay for my trips from town to town.  Besides, I get a T shirt when I go.  Wonder if they come in tie dye??

I have been on Twitter for awhile and FB and it is so funny that if you can get the uber bloggers and technology powers that be, at any of the REBarcamps, NAR, Inman - the social network groupies, if you will, like to go and learn about the latest and greatest from these folks who are always on the cutting edge of technology.  We hang on every word. We are today's Dead Heads, and darn proud of it.  We listen and learn.  Just think there are even T-Shirts!!!

Funny thing is they sell out the house.  I am going to Fredericksburg, VA on March 3rd to attend the VAR REBarcamp, and I cant wait, the one day session is booked solid.  I get to meet my friend Nannette Saunders IRL.  I just found out that I was Sarah Cooper's 800th friend on FB, it is going to be a party.  It is kind of interesting to meet the people that live in your computer. 

If you have not been and one of these conferences comes to an area near you, I strongly suggest that you go.  You will learn something and have such a great time while doing it.  I can't wait until next week in Virginia.  I will have photos and a full report!!  Until Then just keep on Truckin . . .

Procuring Cause has become a hot topic, especially in these times.  Times are tough and some folks are fighting and pinching for every dime.  I have never experienced a dispute, I count myself lucky for that, but think I just got threatened by an agent in my area?

I wrote a post about an agent who feels he is the procuring cause if a sale was produced with my now buyers.  Let me just say the subject property is under contract from another purchaser so it is a mute point as far as my purchasers go, but it got me thinking.

Here is why he thinks he would have been the procuring cause;  They saw the house on the internet and called him to ask about the property.  I think there was one email exchanged and one phone call.  Now here is where it gets tricky - The wife buyer's mother - went over to look at the house to give her opinion to the out of town buyers.  I told the buyers that they would have to buy the house with the listing agent because he thinks that he is the procuring cause because of a chain of events.  The wife said, no, it was one phone call but yes her mother did see the house.

Okay, got that?  So the listing agent started calling the buyers, after I had told him they were working with me with a BBA.  He called the buyers anyway to tell them new info about the house.  I called him to say that if he had information please contact me.  He was not happy but acquiesced.  Let me just say that I work as a fiduciary agent and no matter what the outcome of the commissions I told the buyers, several times, that I would gladly take them to the house to see and sell it to them if that was the house they wanted to buy.  I would deal with the agent later but that I would not stand in the way of the house they wanted to purchase. 

I don't feel that way about the LA because he has caused so much drama, most agents would just take their buyers somewhere else to the detriment of the seller.  To me, that is not representing the seller's best interest.

Later that night, I knew it was not the last that I had heard from him, he emailed the purchasers and copied me on the email.   The email made my buyers so mad I didn't even have to say a word.

He stated the chain of events for why he believed that he was the procuring cause to them and for my benefit.  That was fine, but in the email he wrote to us that he disclosed agency to the purchaser's mother VIA PROXY and the mother signed the disclosure.  My argument would be that the mother is not the buyer.

Think about the consumer and the Internet.  85% of today's real estate consumers start out on the internet and many will sign up for newsletters and auto alert listings where they system is automated and there is a chain of events showing that the agent set up with the internet system might have had something to do with being a procuring cause for a sale of real estate.  Are more agents going to try to lay claim to our hard earned money because they email a pile of listings to buyer and the home they bought happened to be in the pile - I did have an agent call me two years ago and say just that.  Makes me wonder where this might go?

In my area, we have to "carry the purchaser over the threshold into the house" to be considered PC.  I have not been to an arbitration, but they say that each one is different, depends on who is there, what the weather is like, what the mood is - who hates/loves the listing broker/selling broker - so who knows if this type of information will start to make a difference in the future?

The next part of my scenario is the VIA PROXY?  Never had that brought up in my 20 years of RE before?  I figure the LA went to his broker and their company attorney to go ahead and figure this out.  I don't know of any laws in my state with regard to real estate and PC  that deal with a proxy?  It doesn't mean it is not so, I just don't know about it?  I will ask my attorneys that I deal with to answer this for me, just wondering if any of you have had this type of scenario?

By the way, the mother read the listing agent's email and was horrified.  She said the agent never disclosed the agency disclosure to her, nor did she sign any documents.  I guess you can see what I would have been dealing with.  Remember, the house is now under contract and is a non issue.  Actually, even if it was for sale, my buyers are so turned off by the listing agent they would not consider the house at this point.

So what do you think of the Via Proxy, does an internet auto system that delivers the house that they purchase?  Will some attorneys figure out that this might become fair game?  What are your thoughts on this?  Does the public really know what kind of listing agent they have hired?

 

My Client and Friend, Dr Charbel Moussa just published his latest book.  Charlie, told me while we were looking at homes that the book was coming to the market in the near future.  

He told me the book was about how the West and the Middle East can better communicate and work together.  I am very eager to get my signed copy and read it from cover to cover. 

If this subject interests you, I would encourage you to order a copy.  Dr Moussa is compassionate and wants to see changes the state of our international relationships.

I am thrilled for my friend, Dr Charbel Moussa, and his success.

 

This is a great post from my friend, Richard Iarossi from Long and Foster in Crofton Maryland.  What a great treasure we have in our local area of Maryland.  I love the Air and Space Museum in DC, but look at Richard's gorgeous pictures here. 

A great weekend trip during the chilly months.  Enjoy!!

Check out my new listing in Darnestown Maryland. Such a Gracious Home in Montgomery County Maryland. Almost an acre lot, Backing to Darnestown Lake and park, located on a cul de sac. Four large bedrooms, hardwood flooring on both levels. Make this your home today. For more information; Audrey June-Forshey RE/MAX Realty Group 301-921-2672 301-938-8028 www.Audreyjune.com www.MovinMaryland.com