Monday, March 14, 2016

These 10 Expenses Are Why Realtors Don’t Make The Kind Of Money You Think They Do

Much of the general public is oblivious to all the costs associated with being a real estate agent. They mistakenly believe we all drive Benz’s and are grossly overpaid. Nothing could be further from the truth. Carrying a real estate license comes with great expense, and we have to charge our clients accordingly to cover the costs of doing business.
According to Payscale.com, the median yearly salary for real estate agents is $44,488. Most agents don’t even sell five homes per year. With that in mind, there’s a myriad of monthly costs that must be covered, whether we sell a home that month or not.
To demonstrate that it’s not all fancy cars and mansions in the lives of agents, I’ve listed 10 things real estate agents blow their commission checks on which the public has no idea about.

1. Lockboxes:

These little guys, who hang on your door when your home is for sale, are not cheap. Think about it, these are boxes that are destruction proof and operate by satellite. Not to even mention the expensive supra key that you have to buy and have a subscription to, in order to unlock the boxes. Agents who have 10+ listings have thousands of dollars in lockboxes alone.

2. Signs:

An agent can’t sell a home without a sign. Signs aren’t free. Much like lockboxes, when an agent has dozens of signs, they have lots of money invested. The design and shipping alone is hundreds of dollars. Agents use yard signs, open house signs, location signs, sold signs, pending signs, and in the HOA controlled neighborhoods, designer signs. It adds up very quickly.

3. NAR Dues:

The National Association of REALTORS® (NAR) is America’s largest trade association, representing over 1 million members involved in residential and commercial real estate. Not all real estate agents opt to join NAR and become REALTORS®, but the vast majority do. And guess what—NAR wants its money every month. And they don’t take IOUs.

4. MLS Dues:

On top of belonging to NAR, you have to pay monthly to have access to the MLS. The MLS is the source that lists all the homes for sale. Trulia and Zillow don’t have near as much data as the MLS. The MLS charges a hefty monthly fee to list and sell the agents’ homes. It’s very much a necessary tool in the agent toolbox.

RELATED: What Does A Realtor Do To Earn Their Commission?

5. Marketing Materials:

The agent’s main job is to market. They market properties and themselves. Between websites, business cards, flyers, and belonging to sites like Zillow and Trulia, the average agent will spend almost $1,000/month on marketing materials. Some spend $10,000+ in marketing each month. It’s not cheap to spread the word about a multi hundred thousand dollar asset for sale.

6. Advertising:

Paid ads aren’t cheap. Whether it’s on Facebook, a billboard, or the baby seat in a shopping cart, ads cost a lot of money. They’re the lifeblood of a good agent. That’s how they sell your home—by advertising it.

7. Website Hosting:

If you’re going to sell real estate in this digital age, you need a website. You’ve got to have a place for your prospects and clients to come and search for homes. That website has to feed into the MLS (another fee to do that), and the website has to be responsive. The average custom website costs $5,000 and comes with a monthly charge of $200. You starting to see the pattern here?

8. Open Houses:

You may think that we just sit in your home using up your free wifi, but that’s not the case. Depending on the agent, there’s food involved as well as balloons, signs, ads, and staging—all designed to make the place look and feel like a million bucks. I’ve even paid to have someone mow the yard and trim the bushes before an open house. I didn’t have time to wait on the owner to take action.

RELATED: Let’s Get Crystal Clear On How Real Estate Agents Are Paid

9. Closing Gifts:

In most markets its customary (but not necessary) for agents to give a gift to the clients after doing business with them. What most don’t know is that they usually send one to the title company and the loan officer as well. When everyone puts in hard work, the agent wants to reward them so they continue to do so. You may view it as frivolous, but you can never be too nice to title companies and banks. When you need a favor, gifts go a long way.

10. Office Space (often included in an agent’s commission split—read more here)

Most people think that agents have a job with an office. They don’t realize that the broker charges for the office space and the furniture that occupies it. Just know this: Nothing is free in the real estate game. Not even a place to do your work. Agents are nickled and dimed to death. And as you know, commercial office space isn’t cheap.
So next time you’re thinking about hiring an agent, and you think their fees are a little high, think of this list (which is just a fraction of what’s really paid for). They’re all things to facilitate properties getting moved faster and for higher dollar amounts.
It’s not easy, cheap or always fun being a real estate agent, but the smile we see on our clients’ faces when they buy a new home or profit from selling their old one, makes it 100% worth it.
By Ryan Stewman. If you liked this post and sell real estate, check out his personal site which is a top 20,000 website in America and among the top ten sales blogs on the web.

Wednesday, March 9, 2016

Better Chances at Getting a Home Mortgage

Improve Your Chances of Obtaining a Home Mortgage
Securing financing to purchase a new home is one of the most important, exciting, and nerve-wracking financial steps most people will ever take.
During the housing boom, mortgage requirements were relaxed to unsustainable levels, and it seemed just about anyone could approach a lender and walk away with financing. But in an effort to recover from a record increase in foreclosures and loan defaults, lenders have become more stringent; loan applicants must now meet more demanding requirements to obtain a mortgage.
Does this mean that you won't be able to get the financing you need? In a word, no. Here are a few tips to follow for a smoother path to home ownership.
Shore up your credit!
If there is one thing you can do to increase your chance of obtaining a mortgage loan, it is to take careful stock of your credit situation and address any issues that are lowering your credit score. The first thing to do is to order a copy of your credit record from all three major credit reporting agencies: TransUnion, Equifax, and Experian. Look over this information carefully to make sure that all three agencies are aligned in their rating of your credit. If you see any errors, dispute them with the company in question. If your credit is too low to obtain an attractive interest rate on a mortgage (680 or higher is considered good; 720 will put your in very good position to secure financing), take a few months to increase it. One way to do this is to take out a credit card, use it to make regular purchases, and pay off the balance monthly.
Reduce your debt.
By paying down your debt, you will not only show a lender that you are a good risk for making regular payments, you will end up with fewer outstanding payments or accounts to factor into your debt-to-income ratio. Simply put, the fewer static payments you have on your financial record, the better. While it might not be feasible for you to pay off your car or student loans quickly, you should be sure that credit card and store balances are low or nonexistent.
Don't splurge.
If you can put off making any large purchases until after your home sale has closed, do so. This isn't the time to run out and buy a luxury car or take a lavish vacation. The rule of the day is to be conservative with your spending - meaning more cash in hand for that down payment and reserve cash in the bank to fall back on once you need to start making your monthly mortgage payments.
Save. Save more. And then save more.
The amount of money you have in the bank is going to be important when you need to prove to a lender that you can offer up a healthy down payment. While 20% down is the conventional rule of thumb, there are mortgages available that require less cash up front. Your loan officer can point you in the right direction to take advantage of any low- or no-cost down payment programs for which you might qualify. But wherever possible, add to your savings – more money in the bank can only help you qualify for a loan.
Stability is key.
Maintaining steady employment or income is an absolute must when you apply for a mortgage. This isn't the time to try a new career path on a lark or risk taking a new position without a lot of job security. Lenders are going to want to see that you have a proven, stable source of income, that you make regular payments on your rent or existing mortgage, and that you seem like a good risk for financing.

Obtaining a mortgage loan may seem like a challenge, but with a little diligence, a little financial restraint, and the aid of an experienced loan officer, you'll have all the tools you need to secure the financing you need. If you can prove your commitment to the cause, you'll be on the path to home ownership in no time.

Written by Chip Poli

Monday, March 7, 2016

Home tips that are Ego Friendly

Eco-Friendly and Budget Conscious Tips For Your Home
We're a few weeks into the new year, and you might be wondering how you can make some improvements around the home and maybe get some savings in at the same time. Most American homeowners consider a remodeling project at some point in their lives, and many of these folks are on the lookout for ways to be more environmentally friendly as well as cost efficient.
Let's take a look at some of the ways in which you can revamp your home and be eco-friendly at the same time.
Consider a Metal Roof
Metal roofs have been around for long time, but lately they have been getting some well-deserved attention. Traditionally thought of as unattractive, today's metal roofs are not the industrial-looking vertical slats of tin that you might see on a barn. Instead, as one Dallas roofing company points out, they are now available in an array of styles, materials, and colors to compliment all styles of architecture.
While the cost of metal roofing is greater than that of the traditional asphalt shingle roof, metal roofs are lightweight with greater durability. They have better resilience to weather conditions than asphalt roofs which helps to increase their longevity. And what about the environmental factor? Asphalt shingles are a petroleum product with a negative impact on our environment. Also, asphalt roofs need to be replaced every 15 to 20 years. Compare this with metal roofing that can last four or five decades and is often constructed from recycled materials. That's a big difference. And the best part? Metal roofs are energy efficient reducing both your cooling costs in the summer months and your heating costs in the winter months.
The combined savings from the durability of the metal roof to the savings it will help accrue on utility bills will offset the increase in expense over an asphalt roof. Our vote is definitely with the metal roof.
Low Maintenance Lawns
One third of Americans' water usage goes toward maintaining lush, green lawns. Having a beautiful lawn is of course pleasing to the eye, but are there less expensive alternatives that don't make you pause each month as you prepare to open the water bill? Yes, there are definitely cost efficient ways to have beautiful landscaping without wreaking havoc on your finances. Let's take a look at some of those ways:
Try a different breed of grass. Most varieties of Zoysia, Bermuda, and Buffalo grasses are drought tolerant and require less water than some other types of grasses, though Bermuda requires more water than the other two.
Grow a prairie meadow. Prairie meadows are a blend of wildflowers and native grasses that grow easily in the grasslands of North America, typically in the Midwest. They do not require watering and make for a very pretty landscape.
Clover is a hearty alternative to lawn. It grows easily, overpowers weeds, and needs little to no watering. It also thrives in the sun and doesn't need fertilizing. Visually, it is very attractive with its charming four leaf clovers. The downside: it doesn't handle foot traffic well, so you might want to plant it as a "bed" or maybe create a pathway of some sort through it so that the leaves can avoid being crushed.
Any number of ground covers can add greenery to your yard. There are plants that spread outwards but do not grow very tall—these make optimal ground coverings. You can choose plants with flowers or plants that are edible, such as strawberries or various herbs. Just make sure to do your research so that you are choosing plants that require a minimum amount of water for the area that you live in. One thing your ground cover will need is some type of wood or brick border to contain the plants in the area that you want them to stay in.
Save on Hot Water
According to Consumer Reports, heating water can take up one third of a home's energy consumption. So what's the best way to tackle this problem? There are a couple of options.
Some people opt to replace their conventional water heaters with tankless ones. The unique aspect of tankless water heaters is that they only heat as much water as is needed. This efficiency means you can see up to a 40 percent savings on your utility bill. They are definitely eco-friendly as they help to reduce carbon emissions. There is, however, a drawback to these units, and that drawback is the cost. Most tankless units are two to five times more expensive than conventional ones. This cost may be worth it to you since tankless heaters last nearly twice as long as regular water heaters, and of course provide savings every month on your utility bill.
Another step you can take toward reducing your hot water consumption is to install low-flow, aerating faucets and shower heads. For the best efficiency, select a showerhead with a flow rate of less than 2.5 gpm (gallons per minute). You can run a simple test at home to see how your showerhead rates. Turn on the shower, have a bucket which is marked off in increments of gallons, and catch the water flow. If the water reaches the "one gallon" mark in less than 20 seconds, than you could stand to use a more efficient showerhead.
A Few More Tips
Here are a few more ways to be energy efficient and eco-friendly at home:
  • Check to see that the seal around your refrigerator door is in good shape by feeling for cold air around the closed door.
  • Dry two or more loads in the dryer at a time. This way your dryer doesn't have to cool down and heat up repeatedly.
  • Clean the dryer lint filter!
  • Make sure the size of the stove burner matches the size of the pot you are using to avoid wasting heat.
  • Use CFL light bulbs. Compact fluorescent light bulbs are more energy efficient than regular bulbs and give off the same amount of light.
  • Use a laptop instead of a desktop - they use less energy.
  • Unplug your battery chargers when you're not using them. Many chargers continue to draw power even when there is no device connected to them.
  • Change your air conditioner's air filters once a month to keep the system running well.

Saving energy and being environmentally friendly can be done in big and small ways. We hope that some of the tips suggested here can help you maximize your home efficiency while being eco-friendly at the same time.

Written by Realty Times Staff

Friday, March 4, 2016

Location, Location, Location

4 Ways Your Location Can Boost Or Bust Your Home Value
A few years back, "the Starbucks effect" became a legitimate term to explain the higher real estate values associated with living close to the coffee house. But being within easy striking distance of a Grande Skinny Vanilla Latte isn't the only thing that can help boost your home value. Then again, not every location can help build equity. Chose wrong, and you could see your value drop - even if the house is great.
1. Being close to schools
The good: Families seek out neighborhoods with good schools for obvious reasons. Living close to a quality elementary school is especially desirable for parents who envision walking with their young children in the morning.
From a value standpoint, a location close to well-performing schools can be a smart decision for buyers regardless of their family status. "Living near a high-scoring school can increase your home's value by over $200,000, according to the Brookings Institution," said AOL.
The not so good: But, being too close to a school - no matter how good it might be - may be a deterrent for some buyers, which could end up hurting your bottom line. If you're in the path of the school pickup and drop-off, which creates considerable traffic, or directly across the street from a playground, which means there is noise throughout the day, you could have trouble when it comes time to sell. A location that is close enough to be easily accessible but out of range of the daily inconveniences is often the best option.
2. Being close to area conveniences
The good: "The Starbucks effect" is tangible: Data has shown that, "Between 1997 and 2013, homes closer to the coffee shop increased in value by 96%, compared to 65% for all U.S. homes," said CNN Money.
Now Starbucks has company, with a new report that shows that proximity to a high-end grocery store - namely Trader Joe's or Whole Foods - can also raise home values considerably.
"Between 1997 and 2014, homes near the two grocery chains were consistently worth more than the median U.S. home," said Business Insider. "By the end of 2014, homes within a mile of either store were worth more than twice as much as the median home in the rest of the country. The analysis found that 2 years after a new Trader Joe's opened, home values within one mile went up by 10 percentage points more than homes in the rest of the city.
The not so good: But, that doesn't mean all area amenities boost home value. Adult entertainment spots, industrial businesses, a nearby airport that puts the home in the path of flights, and small businesses like tattoo parlors, check cashing, cash advance, or pawn shops that can be indicators of a lower-income or high-crime area can drive people away.
3. Being convenient to freeways
The good: A location close to major thoroughfares can be a selling point since it helps homeowners cut down on the dreaded daily commute. Many suburbs require an additional 10 to 20 minutes in the car after exiting the highway. Promoting the convenience of a home closer in can help it stand apart.
The not so good: Having a car fly off the freeway onto your roof is not ideal. Neither is having to endure the daily noise, congestion, and pollution of living right next to the freeway. If it bothers you, it's going to bother buyers when you sell. Being close - but not TOO close - is key.
4. Quiet location
The good: A home that's in a peaceful area surrounded by nature may be a benefit to buyers seeking a serene setting. A house that backs up to nature or is close to hiking trails can sell for more than a house in the same neighborhood that's only surrounded by other houses.

The not so good There is such a thing as too quiet...

Written by Jaymi Naciri

Wednesday, March 2, 2016

Things that Turn off Buyers

A lot of sellers don't listen to their real estate agents, so we'll tell you what your agent wants to say, but can't say to you and this is it - your agent can't get you the price you want unless your home is in pristine move-in condition.
That means no sticking drawers in the kitchen. No leaning fences. No rust-stained plumbing fixtures. We could go on, but maybe we need to make it clear. If you have even one of following "turn-offs," your home won't sell.
Buyers can get instantly turned off. Here are their five biggest turn-offs:
  1. Overpriced for the market
  2. Smells
  3. Clutter
  4. Deferred maintenance
  5. Dark, dated décor
Overpricing your home
Overpricing your home is like trying to crash the country club without a membership. You'll be found out and escorted out.
If you ignored your agent's advice and listed at a higher price than recommended, you're going to get some negative feedback from buyers. The worst feedback, of course, is silence. That could include no showings and no offers.
The problem with overpricing your home is that the buyers who are qualified to buy your home won't see it because they're shopping in a lower price range. The buyers who do it will quickly realize that there are other homes in the same price range that offer more value.
Smells
Smells can come from a number of sources - pets, lack of cleanliness, stale air, water damage, and much more. You may not even notice it, but your real estate agent may have hinted to you that something needs to be done.
There's not a buyer in the world that will buy a home that smells unless they're investors looking for a bargain. Even so, they'll get a forensic inspection to find out the source of the smells. If they find anything like undisclosed water damage, or pet urine under the "new" carpet, then they will either severely discount their offer or walk away.
Clutter
If your tables are full to the edges with photos, figurines, mail, and drinking glasses, buyers' attention is going to more focused on running the gauntlet of your living room without breaking any Hummels than in considering your home for purchase.
Too much furniture confuses the eye - it makes it really difficult for buyers to see the proportions of rooms. If they can't see what they need to know, they move on to the next home.
Deferred maintenance
Deferred maintenance is a polite euphemism for letting your home fall apart. Just like people age due to the effects of the sun, wind and gravity, so do structures like your home. Things wear out, break and weather, and it's your job as a homeowner to keep your home repaired.
Your buyers really want a home that's been well-maintained. They don't want to wonder what needs to fixed next or how much it will cost.
Dated décor
The reason people are looking at your home instead of buying brand new is because of cost and location. They want your neighborhood, but that doesn't mean they want a dated-looking home. Just like they want a home in good repair, they want a home that looks updated, even if it's from a different era.
Harvest gold and avocado green from the seventies; soft blues and mauves from the eighties, jewel tones from the nineties, and onyx and pewter from the oughts are all colorways that can date your home. Textures like popcorn ceilings, shag or berber carpet, and flocked wallpaper can also date your home.
When you're behind the times, buyers don't want to join you. They want to be perceived as savvy and cool.

In conclusion, the market is a brutal mirror. If you're guilty of not putting money into your home because you believe it's an investment that others should pay you to profit, you're in for a rude awakening. You'll be stuck with an asset that isn't selling.

Written by Blanche Evans