Realtor? For New Construction? Why?

Posted on March 10th, 2010 by katyfamilyhomes.com

I was talking to my Dad on a road trip last weekend and we began to discuss what I do as a REALTOR and my schedule. I was explaining to him that I was currently working with a buyer that was buying a new home in Cinco Ranch. Anyway, as the conversation continued, he asked me a very honest question. “Why does someone need to use a REALTOR if they are buying a home that is brand new and has never been lived in before? Why not just go talk to the builder?” I thought this was a great question. It certainly conveyed to me that many people simply do not know the importance of using a REALTOR. Anyway, I thought to myself that this would make a great post for my blog. So here goes:

Why do you need a REALTOR when purchasing a new home?

It is simple enough for a buyer to know if they like a home that they see. If only that was all there was to purchasing a home. If it is a resale home, then a buyer needs a realtor in order to gain access to the home so that they can see it. This is fairly straight forward. While this is not the only reason a buyer needs a REALTOR, it certainly is an important one. But what about a new construction home from a builder in the area? A buyer can simply go to the model home and view it without a realtor. Fair enough, right? So why is a real estate agent needed?

A simple answer is that a buyer needs representation. The problem is that most buyers, unfortunately, have no clue what that means. Well, I will give you an example of part of what it means. I recently closed on a home I sold in Firethorne, a community here in Katy, TX. I was representing the buyer. When we first talked to the salesperson for the builder, she told us that the list price of the home was $213000. Prior to my client signing a representation agreement with me, he had made the comment that this was the price of the home and that they could afford it. He asked me, “Why do I need you?” To make a long story short, I responded with some of the following reasons:

  1. You need someone looking out for you. For your best interests.
  2. You need to know if the transaction is going as it should be from contract to close.
  3. You need to have the negatives of a home, lot, location, neighborhood pointed out to you so that you will be able to resale the home in a few years.
  4. You need be certain that the contract is written in a way that you understand what you are signing and what it means.
  5. You need to a lot of things.

But most of all, 6.  “I can save you money.”

You see, most buyers assume, falsely, that if they do not use a REALTOR on new construction, they will automatically save the 3% commission that the agent will make. Well, that is flat wrong. Most reputable builders will tell you that they will not change the price of a home if you do not have a realtor or if you do. They like us because we bring buyers to them. Furthermore, they will tell you that the monies used to pay the agent on the contract are used from other funds, not from the funds on the home purchase.

So, back to my story, he agreed to sign a representation agreement with me and I ran some comparible sales in the area from that builder (All REALTORS should do this for you) and showed him what the pricing was on those previously sold homes. We then discussed a legitimate offer amount and he got that house for $183,500, NOT $213000. I would say, as would he, that if I did nothing else for him, which I did, that I had earned my money on that transaction. He has the assurrance that he got as good of a deal as the other buyers in the subdivision and better than the vast majority. It simply amazes me how good people are at rationalizing the deal they get when all they have to base their DEAL on is the word of the salesperson for the builder, who, incidently, represents the builder, not the buyer.

A REALTOR also will help a buyer with other items of negotiation, like grass, trees, blinds, refrigerators, etc. They will help with the scheduling of inspections, negotiating repairs, lender issues and title paperwork. REALTORs are worth their value if you have a good one. This is true on resales and new construction. If you are considering buying a new home, use a REALTOR!! You will be better off.

I would love to help you if you are looking in the Katy, TX./West Houston areas for that home. You can find me at www.katyfamilyhomes.com. I am here for you. God bless.

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Filed under: Buyers, Katy Family Homes, RE Transaction Information

My Daughter’s First 300h Race

Posted on March 5th, 2010 by katyfamilyhomes.com

What a blessing I had last night. I watched my daughter run her first race as a human. AWESOME!! I am so proud of her I thought I would show it to you. She finished second in the heat and won a 3rd place ribbon (out of 18) in the junior high track meet. Check her out. I think you will like it too. God bless.

 

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Filed under: Katy Family Homes, Personal

MLS Report for January 2010

Posted on February 17th, 2010 by katyfamilyhomes.com
Houston’s Luxury Home Market Gets a Boost in January
Surge in sales of homes priced $500K and above promotes double-digit price appreciation
 
HOUSTON — (February 16, 2010) — The Houston real estate market opened 2010 with a mixed bag of readings, making it difficult to determine a clear direction for the months ahead.
January sales of single-family homes across the greater Houston area slid 12.3 percent compared to January 2009, according to the latest monthly data compiled by the Houston Association of REALTORS® (HAR). When broken out by segment, sales of single-family homes priced from $500,000 and above showed dramatic gains in January while sales of homes on the opposite end of the spectrum, those priced from $80,000 and below, fell. Sales of all property types declined 7.4 percent in January on a year-over-year basis.

At $144,500, the January single-family home median price—the figure at which half of the homes sold for more and half sold for less—rose 11.9 percent from one year earlier. That represents the ninth consecutive monthly increase in median price as well as the highest Houston median recorded in a January. The average price of a single-family home appreciated for the fourth straight month, reaching $194,154, up 18.4 percent versus January 2009. That figure also represents the highest for a January in Houston.

Foreclosure property sales reported in the Multiple Listing Service (MLS) fell by 30.1 percent in January compared to one year earlier. The median price of January foreclosure sales rose 4.6 percent to $84,750 on a year-over-year basis.

Sales of all property types in Houston for January totaled 3,049, down 7.4 percent compared to January 2009. Total dollar volume for properties sold during the month was $565 million versus $535 million one year earlier, representing a 5.6 percent increase.

“Several overlapping factors influenced the Houston housing market as the new year began,” said Margie Dorrance, HAR chair and principal at Keller Williams Realty Metropolitan. “These include both the first-time homebuyer tax credit and the expanded credit for existing homeowners, which may have prompted more listing activity. Strong sales activity in the higher-end single-family home segment also contributed to an overall higher average sales price for the Houston market. We hope to see both sales and pricing continue to reflect a robust real estate market as the April 30 tax credit deadline approaches and we enter the traditionally busy spring homebuying season.”

January Monthly Market Comparison
The month of January brought Houston’s overall housing market mixed results when all listing categories are compared to January of 2009. Total property sales declined while total dollar volume and both median and average single-family home sales prices rose on a year-over-year basis.

The number of available properties, or active listings, at the end of January edged up 2.3 percent from January 2009 to 45,210. That represents 2,025 more active listings than one month earlier, in December 2009, and is thought to reflect increased activity stemming from the homebuyer tax credit that expires on April 30

January’s month-end pending sales—those listings expected to close within the next 30 days—totaled 2,783, down 13.5 percent from last year. That suggests there will likely be another sales decline when the February numbers are tallied. The months inventory of single-family homes for January inched upward to 6.1 months compared to 5.7 months one year earlier, but remains better than the national months inventory of single-family homes of 7.2 months, reported by the National Association of REALTORS® (NAR).
 
CATEGORIES JANUARY 2009 JANUARY 2010 PERCENT CHANGE
Total property sales 3,292 3,049 -7.4%
Total dollar volume $535,131,442 $565,091,875 5.6%
Total active listings 44,178 45,210 2.3%
Total pending sales 3,216 2,783 -13.5%
Average single-family sales price $163,983 $194,154 18.4%
Median single-family sales price $129,110 $144,500 11.9%
Months inventory* 5.7 6.1 6.4%
* Months inventory estimates the number of months it will take to deplete current active inventory based on the prior 12 months sales activity. This figure is representative of the single-family homes market.
 
Single-Family Homes Update

January sales of all single-family homes in Houston totaled 2,514, down 12.3 percent from January 2009. This is the Houston market’s second consecutive monthly decline in sales. However, broken out by segment, sales of single-family homes priced between $250,000 and $500,000 jumped 21.6 percent in January while sales of luxury homes—those priced from $500,000 to the millions—surged 40.0 percent. By contrast, sales of homes in the below-$80,000 segment fell 28.9 percent and those priced between $80,000 and $150,000 slid 19.3 percent.

Heightened sales activity in the higher end of the housing market drove pricing up in January. At $144,500, the median sales price for single-family homes rose for the ninth consecutive month, up 11.9 percent from January 2009. That’s its highest median for a month of January in Houston. The national single-family median price reported by NAR is $177,500, illustrating the continued higher value and lower cost of living that consumers enjoy in the Houston market. The average price of single-family homes in January was $194,154, an increase of 18.4 percent from one year earlier. That represents the fourth straight monthly jump in the average price and the highest for a January in Houston.

HAR also breaks out the sales performance of existing single-family homes throughout the Houston market. In January 2010, existing home sales totaled 2,071, an 11.9 percent drop from January 2009. The median sales price rose 13.7 percent to $133,000 compared to last year. The average sales price of $180,159 shot up 23.0 percent from its January 2009 level.

Townhouse/Condo Update

The number of townhouses and condominiums that sold in January rose 14.8 percent compared to one year earlier. In the greater Houston area, 241 units were sold last month versus 210 properties in January 2009. The median price of a townhouse/condominium fell 11.3 percent year-over-year to $111,500. The average price slipped 4.3 percent to $147,501 from January 2009 to January 2010.

 

Lease Property Update

Demand for single-family home rentals rose 4.7 percent in January compared to a year earlier. Year-over-year townhouse/condominium rentals climbed 5.1 percent.
Houston Real Estate Milestones in January

  • The average price of a single-family home appreciated for a fourth straight month, by 18.4 percent, to $194,154, the highest level     for a January in Houston;
  • The median price of a single-family home rose for the ninth consecutive month, by 11.9 percent, to $144,500, the highest level for     a January in Houston;
  • 6.1 months inventory of single-family homes compares favorably to the national average of 7.2 months;
  • Townhouse/condominium sales rose 14.8 percent;
  • Total dollar volume grew 5.6 percent, reaching $565 million.
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    The computerized Multiple Listing Service of the Houston Association of Realtors® includes residential properties and new homes listed by 25,000 Realtors® throughout Harris, Fort Bend and Montgomery counties, as well as parts of Brazoria, Galveston, Waller and Wharton counties. Residential home sales statistics as well as listing information for more than 50,000 properties may be found on the Internet at http://www.har.com.

    The information published and disseminated to the HAR Multiple Listing Services is communicated verbatim, without change by Multiple Listing Services, as filed by MLS participants.

    The MLS does not verify the information provided and disclaims any responsibility for its accuracy. All data is preliminary and subject to change. Monthly sales figures reported since November 1998 includes a statistical estimation to account for late entries. Twelve-month totals may vary from actual end-of-year figures. (Single-family detached homes were broken out separately in monthly figures beginning February 1988.)

    Founded in 1918, the Houston Association of Realtors® (HAR) is a 25,000-member organization of real estate professionals engaged in every aspect of the industry, including residential and commercial sales and leasing, appraisal, property management and counseling. It is the largest local association/board of Realtors® in the United States as well as the largest individual membership trade association in Houston.

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    Filed under: Economy/Market, Katy Family Homes

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