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March 26, 2007

The Turn-key buyer

I had an interesting conversation with a fellow real estate colleage the other day about trends in our current market. We both began describing a trend that seems to be reappearing these days with buyers we encounter in the market, which is quite a bit different from the buyers we've come to know (and love) circa 2004-2006.

For the lack of a better term, I'm going to coin this buyer the "turn key buyer".

What is the Turn Key buyer? Well, it's more of a mindset or an attitude of a buyer, than the buyer itself. Going WAY back to the era of 2004-2005, I seemed to have nothing short of a running list of buyers who were looking for "that next great deal" in real estate. Wanting to find something that was in the "next up-coming neighborhood" that "needed a little work" or fixing-up. Their expectations weren't high, but their dreams were. Actually, their expectations usually matched their pocket books and mortgage pre-approval amounts (surprise!).

But today, there seems to be this new mixed-signal attitude from buyers. Even those that say "Christopher, I would consider a home that needs some fixing up, or some cosmetic improvements" don't ultimately mean it at the end of the day. Perhaps I'm slacking a bit on my job by not asking them to "clearly define" what their idea of cosmetic improvements is, so perhaps there is a disjoint in the levels of expectations right from the begininng. But, there are SO MANY great opportunities still out there!

The turn-key buyer is this new buyer who doesn't even want to paint a wall. If the house is perfect (meaning that it meets at least 85% of their major criteria in the price point they're shopping in) and has a wallpaper border going around the dining room that they wholeheartedly dislike, it's immediately rejected as an option. Carpet in a couple rooms that is worn or a color that doesn't go with their current bedspread causes them to run screaming from a well-priced home.

Why is that? Has the media beat into the minds of the public the idea of it being a "buyers market" to the point that buyers come to expect perfection? There truly is no such thing as the perfect turn-key house, yet it seems that is all that most people are out shopping for.

I guess my bottom line in this rant and rave is this: don't be afraid of a paint brush, don't fear peeling wallpaper, don't shy away form replacing tile or refinishing a hardwood floor or two. See these as OPPORTUNITY!

March 21, 2007

Building "Up" in Saint Louis City

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Seeing signs of a city that is "maturing" is very exciting to me. A recent post on the Rehabbers Club list-serv pointed out this adaptive reuse of a single-story flat-roof bungalow in the Tower Grove Heights neighborhood.

A good friend of mine, one who always has great visionery ideas, once proposed to me this idea of taking a 1-story flat roof bungalow and adding on top of it. In my somtimes overly-conservative ways, I shrugged it off as "nope - not doable. Not gonna happen." And then this photo surfaces and proves me wrong--and boy am I glad it did!

I think this is wonderful. While the TGH neighborhood doesn't have particularly large numbers (if any) of the mansard-style 2-story homes, I think it's a great new addition that truly pays homage to the architectural history and make-up of the surrounding area, while keeping and re-using ina modern way the century-old structure that perahps was a bit unusable, being a 3-room, 1 bed/1 bath shot-gun style home. I'm anxious to see them continue and see what materials they use to finish out the space.

New City Home Listing in Dogtown: 1557 Louisville, 63139

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Check out this great new city home listing for sale in Dogtown

http://www.1557Louisville.com

On a premier all-brick block in the heart of Dogtown, this 2 bed / 1 bath well-adorned full-brick bungalow boasts larger-than-average rooms for over 1,100+ sq ft of living space.

Hardwood floors, arched doorways, wood-burning fireplace, expansive front porch w/swing, stained glass & built-insoozing with classic city character. Add to that recessed lighting, an updated kitchen (island + stools stay), newer appliances (all included w/a full price offer), walk-in master closet, full bsmt, off-street parking (driveway) and great move-in-ready decor.

Plenty of system updates, with newer roof, gutters, facia & flashing in 2004, copper plumbing, some PVC, newer front storm door, and seller to offer 1-year AHS home warranty plan for peace of mind to the lucky new owner. This home sparkles so hurry for the chance to call 1557 Louisville home!

Video Tour: Click here

Virtual Tour: Click here

Email me about this listing

September 12, 2006

One REALTOR's view on the market 'hype'...

So, I'm starting to get frustrated with the media. My profession as a Real Estate Salesperson is, apparently, very easily affected by what (I feel) is starting to become 'sensationalized hype' in the media. And even in "little old Saint Louis", the national news of market trends in NEW YORK and in LOS ANGELES is tainting the mindsets of the would-be (and currently-are) property owners in Saint Louis.

The whole idea of a "marketplace" is all about psychology. Honestly. Let's think about it: the stock market... remember back to pre-tanking of the tech stocks? It was built up on people putting faith in something... believing that it is strong, and worthy of their investment. Then, corporate fraud and changes in regulation come about and everyone runs scared and yanks their investments out of the "unsafe stock market". Where did alot of that go? Yep -- into the real estate market, I'll bet. Had to be. They "believed" in that more than the stock market after getting hurt. Now people are fearing that 'hurt' in the real estate arena and are beginning to panic.

I fear that we're going to cause a collapse of the real estate market UPON OURSELVES if we are not careful! Let's look at the facts and then analyze the psychology behind it.

The current average interest rate for a 30-year conventional loan product is hovering around 6.5-7%. While I will TOTALLY AGREE that we don't have it as good as we did about 2 years ago, that does not mean that the well has run dry and that we're in for a major drought! In fact, if you look at the history of interest rates (especially pertaining to mortgage interest rates), you will discover that our CURRENT MARKET INTEREST RATE conditions are still exceptionally low! Now is a GREAT time to buy, not get scared adn start getting gunshy... we all need a place to live and if you gamble that if you wait, conditions will get better, chance are you'll kick yourself even harder in a year when rates are back at a more NORMAL 7.5-8%!

While I wish one of us could get ahold of that genie in a bottle (I'd gladly volunteer) and get one wish -- the wish to be clairvoyant -- to see into the future, to have that crystal ball. I don't have that power, and market conditions could change drastically tomorrow. But the more scared we get as investors (buyers), and the more we allow ourselves to be affected by the sensationalized conditions and trends in the media, the bigger long-term impact we'll have on ourselves! We'll cause it on ourselves!

Bottom line -- I believe that this "buzz" out there about the looming "real estate bubble burst" is full of misconceptions. The often-mentioned housing market bubble is a myth. Every market has corrections and our Saint Louis real estate market is no exception. Let’s dismiss some of these misconceptions, one at a time...

1) First, real estate has not declined due to rising mortgage rates. In fact, most 30-year mortgage rates are still under 6.5%, and lenders are still offering great deals on adjustable-rate mortgages and refinancing.
2) there has not been a “collapse” in real estate housing prices, as the doomsayers are sensationalizing. The problem is declining sales, not declining prices. As a matter of fact, average real estate prices may continue to rise here in the Midwest. The housing market has slowed for one simple reason: Prices are simply too high for most investors (buyers) to find great buys in the housing market, especially the NEW housing market. However, considering a crash is probably a far fetched assumption and completely pessimistic. Some markets will correct but most will not crash and all of this will produce terrific buying opportunities as the amateur investors and overpriced developers are flushed out.
3) there is also a problem within the Saint Louis market, specifically, with a "critical mass" issue. We continue to build and build and built, while our internal population of potential homeowners do not rise. We are not actively attracting new, large businesses to our market that would bring along with them increases in population to fill and purchase these new housing units.

All in all, I hope this posting is taken off-the-cuff, and that again -- without the crystal ball, no one can predict what might happen tomorrow, or next week, or next year. But if we all fall into this sensationalized 'hype' that is plaguaging the media, we'll start to BELIEVE it.

How does the cliché go? Oh yeah... what you BELIEVE you can ACHIEVE. So get out there and take advantage of the market conditions -- purchase that investment property and use your streghts as a buyer in a looming buyer's market to capitalize on the opportunities out there, and revel in it in the future. :)