Category Archives: Austin Home sales

New Construction vs. A Resale: Pros and Cons

Hello again friends, followers, readers and such—

It’s been a while since my last blog post and I thought now would be as good of a time as any to discuss the pros and cons of buying a new home in the Austin market…as I have 6 clients under contract for new homes…crazy. Some close next month, some as far out as 2018.

First off, when I say “new” I am referring to a brand new build, no one has lived in prior. And when I say “resale” I am referring to homes that have had at least one owner {example: a resale home is like a used car}.

NEW CONSTRUCTION-The Pros and Cons:

Timing Pro: If you have no lease and time is not of the essence for you, then perhaps waiting for your home to finish up works out nicely. How long can a new home take? Totally depends on the builder and complexity of the home and when you entered in on a contract.

Some builders already have pre-chosen floorplans, finishes etc, which makes the build process slower and some builders let you pick everything from start to finish. Always add on time from the builder’s original date of completion, there are always delays to account for! Always!

Timing Con: Almost always does a new home take longer than the originally projected date at contract to completion. I have had some instances where past clients have slept on different Air Bnb’s, had to pay exorbitant month to month fees on their lease due to delayed construction. It is something to be aware of, and it is honestly something that is not in the buyer’s control (which can be even more frustrating). Rainfall and labor shortage are often the biggest reasons for delays in this market….or so we are told. For example, I have clients building a DR Horton Express home. In late January we were told the completion date would be late March, then next update was mid April and now it is May 17. Be prepared to be flexible when building a new home!

Brand New Feels Pro: Having something move in ready and clean and just how YOU want it certainly has its perks. You picked the backsplash and the layout and maybe even the lot. You don’t have to put up with someone’s lack of maintenance to the outside, old windows, an HVAC that’s about to break, etc.

Brand New Feels Con: If you are one of those people who like more charm and character, a new home may not be the one for you. Or perhaps if you prefer to be “closer in” and within budget–a resale just may be the way to go to get both of those check boxes, but you will sacrifice in this instance maybe your desired finishes or taste. Some funky flooring you would have never chosen or an odd master bedroom layout. But again no home is perfect! You want to aim for a home that has 85% of the things you desire.

Warranties-New Construction: New homes usually have a pretty decent warranty. They will vary among builder, however the most common for production builders is called a 1-2-10. Which means the first year they’ll come in and do touch up’s, cosmetic issues, address things that may have broken or chipped away etc. The 2yr part of the warranty covers systems-HVAC, dishwasher etc (and most the time you can register for an extended warranty on your new home appliances). And lastly the ten year covers structural–if anything happens to the foundation/exterior the first ten years it falls back on the builder to fix.

Warranties-Resale: Resale homes also offer a home warranty. In the contract the seller pays for a one year home warranty for the buyer. You can put anywhere from $0 to $450 (about average) in the contract and the buyer chooses the home warranty they’d like coverage from. Some feel that home warranties are a “rip off.” And I will admit, sometimes they don’t have the best situations: Let’s say the HVAC goes out–well, often times the home warranty company covers all of the HVAC with the exception of a few parts. It just so happens that the parts that aren’t covered by the home warranty are traditionally the most expensive and parts that go out the most. However! There are many times when my clients have purchased a home warranty and had dishwashers fixed, leaky faucets repaired, among other items and that’s nice to have that covered right after moving into a home.

CONTRACTS for New Construction: The main point I tell my clients when they buy a new home is that builders have all the rights in a new home contract (for the most part). If you read most builder’s contracts it basically states–we can take as long as we want to build your home. If we finish early, you have to close that month, if we close late, we aren’t paying your late fees your apartment changes and you are still under contract with us. There is usually no right to rescind in a new home contract and no option period or 48hr policy to get your money back once you have put in the deposit and signed. In most cases the contract states– in the 6mo you are under contract with a builder and you lost your job and could no longer get financing–the builder has the right to keep your deposit. Some builder contracts state if the property doesn’t appraise, the buyer must make up the difference. This is important and something you should know before signing on the dotted line, it can be risky. Now, do the builders want to take forever to build your home or keep your money if something were to happen to your family? I’d like to say no, but I have seen specific situations with my clients and they can go either way.

When you purchase a resale–the buyer has many rights to cancel the contract, but the term is on average a 30 day process. The buyer has a deposit to pay (earnest money), however if they should cancel the contract post inspection or for ANY reason within the option period–which can be anywhere from 5-10 days, that money is returned to the buyer. There are several “outs” for a buyer on a resale contract that pertain to documents getting to the buyer in a timely fashion, etc.

INSTANT EQUITY?-New Construction Pros: For many people who buy in a neighborhood early enough, where there is projected growth {lots of plans for more homes i.e phases 2 & 3, projected job growth nearby or a new school coming in, commercial space coming or already existing up the road etc.} the perk often times are prices usually only rise in a new home community in Austin. There are lots of incentives that come into play when you purchase early and at the right time. Incentives vary, but being the first home on the block, staying put for a few years, you will definitely see value and equity fairly quickly, especially in the Austin market. I have seen it with several clients in a little as two years. My clients purchased, the neighborhood built up, opened a second phase and my clients didn’t have to do any particular upgrades and still ended up profiting after fees when the sold their home. This does not ALWAYS happen, but buying early has its advantages.

“Top of the Market”-New Construction Cons: This isn’t as common, but at times when you are the last person to purchase a new home in a neighborhood that has been building for a while you may be paying more than the other homes sold, naturally with market demand. That is due to new homes starting competitive and low, and as demand picks up, pricing increases sometimes weekly and incentives are given and taken away depending on how many contracts a builder has, etc. Usually one of the last homes to sell in a community is the model, and those are more expensive because they are decked out with upgrades. Appraisal issues can arise in new home subdivisions as well For example–when you are one of the first large homes with upgrades being built, if not enough homes have sold before yours, an appraiser doesn’t have much to compare yours to, therefore the value comes in lower than what you are paying–despite future floorplans selling for higher. I have seen this happen several times with new construction–they typically occur with VA loans (who have more strict appraisers) as well as those who use a credit union or lender not familiar with the community, unfortunately.

PRICING PROS and CONS: In real estate there are always some sacrifices you have to make. Price, location and size/layout are typically the big three. Some see new home’s pricing as a great deal due to the space you get, the fact everything is brand new, yet typically sacrifice location if you are moving further out where Austin is expanding. For a brand new home in a popular Central Austin neighborhood, for example 78704’s Travis Heights or East Riverside next to Lady Bird Lake, you are getting a fantastic desired location or an area with projected growth, but some sacrifices may be size or price–but again, you are getting a brand new home, so typically the cost per square foot will be much higher than something built thirty years ago. My main advise to all my clients who are looking to buy is to first get pre-approved and know what you want to spend. Secondly, start looking online, visit open houses, then perhaps visit new home models. From there, you can make a decision of what you like the most.

Now, I got this question the other day, so I thought I would clarify a few myths/misconceptions:

1. In Tx an agent doesn’t help you buy new construction homes, right? No. Clearly, like I stated above, I have helped many people purchase brand new homes. The ones who usually are not licensed are the sales agents who work for a model home. Some do have a Tx real estate license, but most are trained by the builder to sell the homes they are building. Just note, in Tx if you don’t sign a buyer’s representation agreement with a real estate agent, then technically the Seller is represented.

2. If I don’t use an agent to help me buy new construction, can I save on the sales price since now there is no commission to be paid to an agent? No. A builder has already set in their budget their cost of building, marketing fees and cost of doing business. I have quite a few friends who work for builders and sell new homes, they told me–in a town like Austin with over 5k agents, the last thing a builder wants to do is gain the reputation for cutting Realtors out of deals. BUT the most important thing to note is that if you purchase a new home with the sales agents who works for the builder, you now have NO representation. No one to go to bat for you when things are delayed or you are trying to get your money back or something was installed incorrectly in your home.

Here are some great communities where you can find my clients have a contract with a new home builder:

East Shore by David Weekley

Woodland Park (Georgetown) By Century Builders

Pioneer Crossing by DR Horton

Edgewaters (Pflugerville) by KB Homes

South Shore Pointe by InTown Homes

Colorado Crossing by Lennar Homes

 

 

 

 

 

 

 

 

Austin Real Estate Forecast 2017 (Recapped from Ted Jones)

Dr. Ted Jones is the Economist for Stewart Title. (Twitter Handle is @drTCJ)

He gives a great presentation and holds your attention and packed with a few funnies along the way. This morning I wanted to re-cap some of the things he discussed and presented on regarding the future of Austin’s Economy.

Despite the election, Ted started off with reminding of us two things:

1. Brexit was the first sign that things were already changing and

2. Don’t let yesterday take up too much of today.

No matter the outcome of the election, traditionally speaking, each election year, right before the election, things typically slow down due to market uncertainty–then they pick right back up (again, regardless if there’s a conservative  or dem in the white house, statistics usually demonstrate this).

Let’s start with Millenials (they are an important part of our Economy, especially here in ATX):

Things to Know: The top 3 Markets with Millenials are:

  • Charlotte 30%
  • Houston 17.4%
  • Austin, Tx 16.4%

76 Million Boomers, 83 million Millenials between 19-35 and 91 million Millenials between 16-35.

75% of Millenials polled say they can live without the call function on their cell phones, 76% prefer texting>talking and 19% never check their voice mail. (guilty a lil, right here).

The above statistic is funny to me. I don’t think of myself as a Millenial, but according to the year I was born, I am. But I will say I have traits from the generation before and after me combined.

{Fun fact: 70% of Millenials prefer shopping in store v. online, due to instant gratification/satisfaction. This is why company’s like Amazon are trying to speed delivery, do drone drops etc–Millenials want it NOW.}

HERE is a great little article on best housing markets FOR Millenials.

Now, let’s talk Non-Renewals/Dead on Arrival/Items already going away:

  • Mortgage insurance deductability
  • Mortgage debt forgiveness
  • Residential energy savings
  • Obama care (or some form of it)
  • Wind and Solar tax breaks

Soon to Happen Changes/Items in the works ??:

  • US has the highest corporate tax rate and we are one of the Top Developed Countries
  • Capital Gains tax cut
  • Middle class tax changes (some up and some down)
  • Carried Interest Elimination
  • US Overseas corporate profit repatriation
  • Corporate tax cut (35%–>15%)

{Fun fact: in 2000 Germany corp tax rate was around 42% in 2016 they are now at 15.8%. Did you know that every BMW x3,x4,x5,x6 was made in South Carolina due to the corp tax rate? It is the largest plant and they make BMW for worldwide-read more on that here.}

Things to note: Currently, and for the last several years leisure and hospitality spending is at a rate higher than job growth–which means a steady market, when we see a drop in leisure and spending is when we hit a recession.

Top States with Job Growth:

  • Florida
  • Washington
  • Utah
  • Oregon
  • Nevada
  • Hawaii
  • Idaho
  • South Dakota
  • Georgia
  • California

Now let’s turn to the states at the bottom of this list (decline in job growth) and look at what they all have in common:

  • Alaska
  • Oklahoma
  • North Dakota
  • Wyoming
  • Louisiana
  • Kansas

They are all Oil and Gas based economy (ok maybe not Kansas, but what’s going on in KS…not a lot). Note, Tx isn’t on this list.

Tx is around 1.77% for job growth, we fall in the top half of the list. “This is the best oil turn down Texas has ever seen.” Jones said. And when you look at the greater Austin area: our market survives from: Tech, Education, Healthcare…Which leads me to…

2016 Stock Market Trends:

  • 13% up for Dow Jones Industries
  • 9.5% S&P500
  • 7.5% Nasdaq Composite
  • 45.2% crude oil

Mega Themes for 2017:

  • More Jobs before the election than ever before in History
  • Retail boom is on a 14 yr run
  • Entry level home buyers are returning
  • High end housing is retracting
  • Commercial Sales
  • Inflation potential (ie UPS increased rates 4.9% 12.26.16)
  • 2016 Commercial Sales were at an all time high in Austin Tx, this is different (above average) than the National record, and Austin is only at a 4% vacancy rate.
  • Rent has been increasing about 5% year over year.
  • Oil most likely stay about the same around $60/barrell (saving the average driver about $550/yr)

2017 Positives and Concerns:

  • Return of ARMs and Second rate loans
  • Faltering high end residential sales
  • Retracting commercial sales (Austin a little different)
  • Inflation
  • Midwest Land value increasing
  • Oil sub $60/barrel

Jones also predicted mortgage interest rates ranging from 4.7%-5.3%, but a 5yr ARM starts at 3.5% currently, “people will just have to get creative.”

Toward the end of the presentation we touched base on Property Taxes (and how outrageous they are and heavily based on our education system–another issue itself on how we pay and grade our teachers and schools, but I will digress).

What did I gather overall from attending Ted Jones’ Economic Forecast? In Sum:

  • Austin will be strong and steady this year, especially for those already here with jobs, he predicts Austin, Seattle and San Jose will not have a declining luxury market, however our (the company I work for, Realty Austin) Broker, Jonathan Boatwright differs on this a little, when he was quoted in the Statesman last week (article HERE and he says the numbers don’t lie)
  • Due to affordability in Austin, people will start getting a little more creative with their loans–perhaps 7 and 10yr ARMs (adjustable rate mortgages) for those who know they won’t be in a house for longer than that…these are for savvy, good credit buyers, wanting to get in their price point and save a quarter on the interest rate (the “scary” part is not knowing where rates will be in 7yrs)
  • Job growth is declining here in Austin (not by much, not rapidly, but it is becoming harder for those to find a job relocating here) Went from 5%-2%, so not by much, but slowing
  • We are NOT overbuilding. While it sometimes may seem like we are, we are still at 2.1mo of inventory. A balanced market is at 6mo of inventory and a seller’s market is usually around 4mo. So basically things are still pretty crazy here in Atx.
  • Will there be growth in 2017? Yes.
  • Will the Fed’s interest rate effect our market here in Austin? Not so much (they do correlate, but not impacted directly).

What’s Next? This is where I insert my plug. “If you are thinking of buying an investment property, leasing or selling your current place, buying your first home, selling a home…well get to it–call me.”

As always thanks for reading and I hope you found this re-cap informative!

-Ashley Brinkman

ashleybrinkman@realtyaustin.com-signature

 

Filing Your Homestead Exemption: Austin, Tx and surrounding areas

Did you buy a home last year?

Do you want a tax break?

Good, here is what you need to do to get that tax break…

First-write down on your “to do” list: File Homestead Exemption

Secondly, actually take about 10 minutes to do it.

Isn’t it funny how the most mundane tasks get put off and shoved to the side? When you put that stamp and send it in (or fill it out online) you think, “oh that really wasn’t so bad, afterall, why did I wait so long to do it?” {still on my to do list by the way}

So, my Austin area peeps:

Below are the links to information on how to download the necessary forms to claim your exemption-based on what county you purchased your home in:

  • Travis County 
    Mailing Address: P.O. BOX 149012, Austin, TX 78714-9012
  • Williamson County or File Online
    Mailing Address: 625 FM 1460, Georgetown, TX 78626-8050
  • Hays County
    Mailing Address: 21001 IH 35 North, Kyle, Texas 78640
  • Bastrop County or Call 512-303-1930 ext. 22
    Mailing Address: P.O. Box 578, Bastrop, TX 78602
  • Burnet County
    Mailing Address: P.O. Box 908, Burnet, TX 78611-0908
  • Llano County
    Mailing Address: 103 E. Sandstone St., Llano, Texas 78643

As Austin and surrounding areas home pricing increases, so will taxes. Typically (yet not always) your tax value is a bit behind your actual appraised value of your home.

**Remember your tax value and assessed home value by your lender are two different things. And as some say– You want the taxing authority to think you live in a shack and your loan provider to think you live in a mansion (wink, wink)**

So at the start of the year, by April 1, you need to have your homestead exemption filed if you are currently living in the home you purchased the year prior.

EVALUATION PHASE:

Jan-late March is the evaluation phase. Around April you will get a letter in the mail with your tax appraised value if:

  • the appraised value of the property is greater than it was in the preceding year $1,000 or more;
  • the appraised value of the property is greater than the value rendered by the property owner; or
  • the property was not on the appraisal roll in the preceding year

EQUALIZATION PHASE: 

April through July for the most part–

After you get the letter in the mail, you may protest your taxes.

If you paid less for your home than what the taxing authorities are saying it is worth, it is fairly easy to get your taxes reduced by showing them your final closing statement.

**However!! Fun Fact: Texas is a Non-disclosure state! So let’s say after you close on your home you get a piece of paper in the mail, it looks official and it asks, “What did you pay for your home?” send this back in to us…You, as a Texas Resident do NOT have to report what you paid for the home.**

There are two hearings to arguing your taxes-an informal and a formal. Basically if you don’t get your way in the informal (which you can send in the piece of paper- ON TIME), you can request a formal. You present your comparable sold properties and explain your case as to why you should not be taxed as much as you were. (This is where I come in! As your/a realtor, I can try to help you find homes similar to yours and what they sold for to help your case).

DISCOVERY PHASE

And finally August through the end of the year is the discovery phase for the following year.

After the inquiry/protest season concludes, the appraisal process transitions to the data collection and analysis phase. During this time, appraisers may be seen throughout the County in neighborhoods and commercial areas as they are measuring new residential or commercial construction, reviewing and updating characteristics of existing construction and/or land parcels, and reviewing, updating, or adding inventory of present or new businesses. Yearly updated aerial imagery, digital field devices for data collection, and GIS analysis tools are utilized to assist in staff efficiency, and ensure proper valuations and equitable results during the assigned/limited time for this phase. This process requires collection and analysis of three types of data:

General data, which affect values on national, state/regional, or neighborhood levels.
Specific data, about the site and improvements of a property.
Comparative data, which regards recent sales, cost, and income information for similar properties.

If this is still all over your head, this chart may help explain and is where I got most the information above from (along with past experience): Here is a great Tax Calendar visual to explain.

When your tax bill comes due, depending how your loan is set up will depend on how you pay it. If your money is with an escrow account–meaning you make a payment to your lender that covers: PITI–> principal, interest, taxes,  (home owner’s) insurance. If the value of your home goes up, so will your payment, as your lender will try to “pad” your escrow account so you don’t end up owing more when your bill comes due. Some home loans allow you to make your payment online–and choose if you want to pay extra and if it goes toward your escrow account or principle, which is nice. Or if you don’t have an escrow account (not required for those who put down more than 20%) you can manage your taxes yourself and pay the bill as it comes due.

Hope some of that information helps and if any additional questions, feel free to drop me a line.

AshleyBrinkman@realtyaustin.com

As always, thanks for reading!

How to be a Great Home Owner

I recently purchased a home and one of the things I REALLY appreciated were the seller’s care they took in the home I purchased, but also their responsiveness to questions I had about the home during and post closing.

As an agent now for…I don’t know like 7 yrs-(I cannot keep track any more), there is a noticeable difference of when an owner has lived in (and cared for) a home and when it is a flip or rental or unmaintained. Nothing brings me greater joy as a buyer’s agent than when the sellers are open about information with the home–past bills, year they put in wood flooring, last time they had HVAC serviced etc. These are important things to keep track of! And nothing brings me greater joy as a Selling agent than the big file/paper trail the seller hands over to me when we sign a listing agreement either.

kitchen

If you are not OCD that’s ok! And I am not trying to encourage hoarding either (which seems to become a habit of never throwing anything away once we move into a place that has more space).

hoarder

I thought I would put together a few tips on being a great home owner-and increasing your resale potential in the future, below.

1. Document, document, document.

It isn’t a terrible idea to keep a piece of paper taped inside your HVAC closet of dates you last cleaned it, changed the air filter or had it serviced, make a note each time. Also, to keep track of doing these items, after you purchase a home-maybe add reminders to your calendar (air filter monthly and servicing between seasons).

closing docs

More of an electronic person? Have a folder on your computer (in dropbox or a cloud provider so you don’t lose it if your computer crashes) with all your home owner paperwork: closing documents, survey (that’s a $450 piece of paper), and then as you update your home, take care of things, etc, be sure to keep copies of receipts, invoices, bids etc in this folder for future reference. Painted a room and have leftover paint? Write the room and paint color on can and keep in special place in storage, not just for future owner of your own home-but it may come in handy for you too! Do you have a lawn guy who comes a few times a month or a recommended pool cleaner? It isn’t a bad idea to pass along their info or card to the future owners of your place as well.

2. A special place

Have a designated drawer or file cabinet of some sort for these documents, invoices etc. as well. I was real fortunate when I purchased my home to have a huge stack of manuals of every appliance, light fixture, etc that was updated in my home. As well as a few parts to things that may not have been used, but could be added (extra lock to sliding glass door, under cabinet lighting, etc). The special place shouldn’t be in the attic in a box however, should be an easily accessible place and if you are super into security, perhaps in a locked safe or cabinet of some sort.

file cabinet safe

Are you an owner of an investment property? The management company should keep track of all leases, service orders and maintenance calls, and you will want to make sure you get a copy as well! Save emails between your and your tenants.

3. Take care of it.

If I had to choose between spending $1000 on a trip somewhere or fixing an HVAC leak, it is a no brainer on what I WANT to do, but not necessarily what I NEED to do. If you are generally keeping an eye on things in your home, then hopefully it won’t get to a point of discovering a major issue costing an arm and a leg. Water your foundation with soaker hoses (another item you can add to calendar if it hasn’t been raining), add insulation in the attic when needed, replace or fix items as they break vs putting it off. Yes, much easier said than done.

Plumber working on sink

Have you ever heard the term to “swallow the frog?” Your fixture in the bathroom works fine, but the handle is broken and you have been turning on the shower with a wrench for more than a year. Guess what, as soon as you get someone to fix it (if you can’t yourself) you are going to think: Man, why didn’t I just have this done month’s ago?! It’s the little things that are a pain in the butt, yes, but when everything works as they should in your home-you’re happier.

When  you take care of things now you also save a lot of time when it comes to putting your home on the market because then things are already done (and believe me there comes a hefty list of things to do to make your home sell faster-why add more little tedious projects to the list? “Take care of it” also goes without saying–this means your mortgage, taxes and HOA bills too. Don’t let bills slip away from you!

4. Befriend Thy Neighbor.

friends with neighbors

I know, I know–the crazy cat lady across the street is annoying or the guy that lives below you at your condo is creepy. You don’t have to hang out and cook dinner together, but being aware of what is going on in your neighborhood, with your neighbors, amongst your HOA is never a bad thing. Sure some chat it up way too often and are always spying on what is going on at your place, but when you have great neighbors, there is nothing better! Even if you hate people, make it a goal to introduce yourself to a neighbor or say hi from time to time.

crazy cat lady

Good neighbors: alert you and watch your things when you are on vacation or if there was something suspicious. Good neighbors give great recommendations on who fixed their roof. Good neighbors mow your lawn sometimes since your yard connects. Good neighbors let you borrow a cup of sugar (or these days a wifi password) or lend you a helping hand when doing yard or car work. Are YOU going to be that good neighbor?

 

That’s a Wrap! What it was like filming for HGTV’s House Hunters

So, last week we finished up “Act 4″ of HGTV’s House Hunter’s with Pie Town productions. It was such a fun (and not going to lie, an exhausting) experience, here’s a few tid-bits from behind the scenes.

A while back I had wrote a blog about how I got picked for the show before we started filming, however I got in trouble because I did sign a confidentiality agreement and they asked me to take it down-whoops! So, here I am again posting about HGTV experience, post filming.

house hunterslogo

(Note I do not have House Hunter’s permission to use their logo, but needed a filler and found this on Google image, I am sorry House Hunters-but this is recognizable!)

What I can say in sum, is that it was a pretty cool experience and since I have received plenty of questions, I will now attempt to address them all.

FAQ #1: How did you get picked to be on the show? 

People, it isn’t that hard to apply for a show! Most of the time you go online and then a casting producer calls you if the criteria fits. At the time I had two sets of clients I thought would be a great fit. They reached out to me weeks later. And contrary to popular believe I do not sit around applying for Reality TV shows, promise (I don’t even have cable! However today does mark the exact anniversary of my appearance on Anderson Cooper-still don’t have a dang tape of that either…probably for the best).

ANDERSON COOPER

jess and I

Above: (Sad I got no pics of Anderson and I, but here is the producer Jessica and I!)

Anyway, a casting director emailed me. After a few emails back and forth my client discovered the filming time would not work well with his schedule. At that time I had also just won an offer on a home for myself-so I asked if I would be a good fit, despite being an agent AND the buyer and they said it was fine. (Side note, I have only seen a few episodes of this show since I haven’t had cable in a long time).

THEN you have a phone interview. And they want specifics. How boring would a show be if people were only looking at new construction with an open floorplan and granite countertops and hobbies included movies and going out to eat? (Yes we all want that and do that, but it doesn’t make for exciting television). After she (casting producer) liked what I had to say about my house hunt and hobbies THEN I had to submit a video with a friend who would house hunt with me (and could get off work for filming).

nothingtowearThe hardest part was choosing what to wear (and getting people to sign releases).

So, I thought of Sarah. Plus Sarah and I do craft projects, talk about housing quite a bit, she was a client of mine, we dream of flipping and staging one day and every time I would look at a fixer house I would send her the video for ideas (she is a great visionary). When I asked Sarah if she would want to be on TV with me her response was: “Oh my God, that’s my lifelong dream to be on HGTV!” so it was a no-brainer.

IMG_8876THEN…Sarah and I created a video for the director to watch. I took it off YouTube so you can no longer watch that monstrosity (#sorrynotsorry). It was a Saturday night at midnight and we answered the questions they sent us in a witty/hilarious fashion (side note: we may have had a few glasses of wine prior). The best part of making a video was the fact we had to do a home tour…on a selfie stick. I came around the corner and hit a wall and the phone went flying, I picked it up and kept rolling because I was not about to start over.

Fast forward a week or so and I was in Mallorca, Spain with my friend on vacation. We had literally just got an invitation for free shots at the bar-and as I was about to take it–I got a call with an Los Angeles area code and had a feeling it was Pie Town Productions. Due to bad service and a 7hr time difference, we kept missing one another, but I had a feeling she was calling to give good news. I emailed her in the morning to discover we were in fact chosen for House Hunters. Yipppeeee!!

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FAQ #2: Is the show scripted?

So, fast forward, now about a month from when we got chosen the director (from LA), camera guy and sound guy (who are local and independently contracted, but have worked with the director and show plenty) show up at Sarah’s for day 1 of filming. As we get ready they do exterior shots and set up. Our opening scene is us at Sarah’s on her couch. This is “The Interview” where they discuss our “relationship” and my expectations of home buying etc. Do they tell us line for line what to say? No, the show is not scripted. Did we need help maybe phrasing what we were exactly trying to say and maybe had to repeat certain things-Yes. Sometimes what we wanted to say and what we were actually saying made no sense, I think the camera and lights start to get to you. Because the show looks like it is a “two camera show” we do a lot of takes. So you say everything you would say about a room 5 times because maybe we talked over one another, or maybe the camera was looking at the sink and not a facial expression reacting to what was said, so we do it again. However, please tell Sarah that you heard “she can’t cook but she can make a mean mimosa.” (This was from our crafting session footage and a line Sarah had to say more than 3x as we toasted Andre and OJ)

IMG_0326See this desk above-stay tuned for the After pics on the show!

FAQ #3: I heard some of the houses you tour aren’t even on the market, is this true?

All the houses that are on my show were actually on the market at the time of filming! It was not easy in this fast paced market because I had to have the releases signed about a week before we filmed. Fortunately one popped up on the market a few days prior and owner signed off for filming. The properties were legitimately in the area I was looking and met (for the most part) requirements of what I was looking for. The hardest part, no lie, was getting sellers to sign a release that there home could be on show. It’s a hot market in Austin and for us to take up a whole day filming in a house on a Saturday was rough. I may have even had an altercation with a crabby agent, who showed up before we were done filming. But we took ten and let her show her clients. Fortunately the owners were super nice and grateful regardless.

FAQ #4: Did you just say a whole day to film one house?

Yep, the days are long. And you really can’t go run errands on your lunch break and be taking calls because you literally don’t stop filming. The five-seven minutes spent on the show touring a home is actually 8am-3pm-ish in real time footage, sometimes later. Camera guy arrives early for street shots, exterior shots, then sets up. Then Sarah and I would show up, get mic’d, go over the order of everything and begin shooting room by room. If a car drove by playing a blatant song-CUT! Start over (don’t have rights to play that song). If Sarah or I looked at the camera-CUT! Start over. If I made a weird/awkward/funny face after I said a statement I was unsure about (this happened a lot) CUT! Start over. So you can see how the day just flies by. Lunch with everyone was great and you start to bond with “the crew” which is nice too because as much as it is work, there is a lot of joking around too. The conversation topics are endless as well as our questions for the crew: “How awesome is it to work on food network shows and eat that food?” Or “What’s the grossest thing you saw when you filmed Hoarders?”

IMG_1042Day 2 wrap up above.

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Above: Camera guy Chris during mine and Sarah’s least favorite scene: All of us packed in a car with no air conditioning (too loud on microphones) talking about homes, driving around while he is all up in my grill-BUT I have to pretend like I am talking to Sarah next to me AND not look at camera or make fun/laugh at Chris (again that whole two camera show shots).

After the filming of home tours, Sarah and I had said specific things we enjoyed doing together on camera in our interview–therefore, they wanted footage of us doing those actual “activities.” Makes for much better TV to show it rather than just talk about it, amiright?. So, we really regret saying we jogged/ran half marathons once a year together and wished we would have said we just stay in and watch TV or something. haha.

There we were at 4pm on the Lady Bird Lake board walk jogging…sweating…on camera…with angles from our feet, looking up, I can only hope that footage gets edited down.

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The other “thing” to note is that for all the other things we were filming I had to have location releases, artist releases (for logos or artwork shown), and camera releases for those who would be on camera with me. I would then say “be here at this time, but we could be late, be flexible.” It was a bit stressful coordinating because I didn’t want to hit any snags, but so glad so many of my friends pulled through! I am forever grateful.

Let’s see, We filmed at CG Arena since I said I enjoyed working out (again, can’t have music, so we had to whip up a workout with no music on-so weird). We did a kickball game with a bunch of Austin SSCers (thanks again to all of you who patiently waited for us and played along! And Austin SSC for letting us wear the logo and use the fields! We also filmed Charlissa and I having a sno-cone and chillin’ (she is my lil with Big Brothers Big Sister) a special thanks to her mom for letting her be apart of it, she was excited. And then, because I like photography, we shot me taking photos of hearts at Tyson’s Tacos off Airport, (who was super nice to sign the release on short notice and if you heard, Vance Joy played there after ACL for free tacos!) as well as my signature “clients in front of the door with the SOLD sign” photo. (Thanks Ana and Andres!) So, the days were long, but worth it (or so I hope when I see it air).

girls touched upAn old school kickball team pic of the ladies-thanks for filming with us!

herrerafamilyWhen the show airs, you may spot this sweet family as well!

We spent a total of 4 days shooting. Then they gave me time to move in, and they came back for one day of filming Sarah and I hanging up things in my house, my “exit interview” regarding the home buying process and a quick shot of me and friends enjoying my new backyard/house! (Special shout out to those of you who could make it over at 5pm on a Monday with less than 24hr notice, you da best!)

FAQ #5 When does it air?!?

It won’t air for another 4-6months. I know they already started editing footage because when they came back they made sure to hit on certain key points that you mention in the beginning to tie it all together. They told me they can’t give me an exact date. However, one co-worker who has been on the show says she did get enough advanced notice to plan a watch party (#goalz) and you also get a copy of the show AFTER it airs. You can also keep checking the website for the episode # to see the air date as well. (Episode #11202 folks)

I am thinking of a watch party/client appreciation party when it airs and open to venue locations, send suggestions to me! (ashleybrinkman@realtyaustin.com)

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FAQ #6: Do you get paid?

If I were just the Realtor on the show, no, I would have not gotten paid. The buyer gets paid. I will say it isn’t much. The seller’s who let their house on the show also do not get paid. The friend of the buyer/partner etc does not either. I told Sarah I would split it with her, but she was kind and said I could keep it since I have literally been hemorrhaging money since I closed on my home. haha. {Those home improvement projects add up!} But Sarah and I are going to do a nice dinner to celebrate soon (on me).

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FAQ #7: Do they pay for the home renovations?

Maybe if this were House Hunters renovation-yes, but I have no idea. This was regular House Hunters. The things I chose to do with my house after moving in were all my choice on my dime. In fact, I had already decided to do many of those things before even agreeing to be on the show. I will admittedly add that the projects probably would not have gotten done that quickly had it not been for the camera crews coming back to film me “settled in.” I know Sarah can attest to a couch purchase, laundry room renovation completion and an outdoor project due to the taping of the show as well. But hey, sometimes we need deadlines in life!

jordan ln finishing 3I spray painted the mailbox (to match my front door) the night before the crew’s arrival!

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This house number project was much more complicated than it looks.

jordan ln finishing projectNote this photo was taken at 11pm (because that’s when I finished hanging the patio lights.

jordanlnfrontHad exterior painted a few days prior to arrival as well. The gray is darker than I had wanted, but definitely growing on me and happy overall.

IMG_1122(This is in the midst of the popcorn removal for my home)

FAQ #9: Did you really only look at 3 houses?!

On the show-yes. In real life? Not so much, I probably made offers on about 7 homes for almost a year before I found this one. I know what you are thinking, You are a realtor and you lost out on 7 homes first? And I would argue that I knew what I was willing to pay for the RIGHT house. So when I would get a counter offer at times, (because all the houses I made offers on were multiple offer situations) I wasn’t willing to come up any more because “I just wasn’t feeling it”. So glad I stuck with my gut on that one. I often tell my clients- You will know when you find the right house, it is a feeling you get when you are inside. And then you go for it!

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“It will be mine, oh yes it will be mine.”-Wayne

FAQ #8: Would you do it again?

I would totally be on the show again (as a Realtor) not the buyer (plus I don’t think you can be a buyer twice). But I think it really depends what it will look like post editing when it airs. There were a lot of things I look back on and think “As a Realtor I would have never done __xyz__” but for TV sometimes you have to skip the garage, and you don’t pull down the attic ladder or check the HVAC age and hot water heater. I also think my sense of humor can be taken out of context (especially if you don’t know me)…so when I joke about a safe in my closet and “That’s where I will store my gun,” you may not know that’s me being facetious (plus the laughter after I made that comment will probably be edited out to make for good TV and poking fun of Texans) haha.

IMG_0984I also have seen enough episodes to know that sometimes the buyers in the show are focused on “Where the husband’s large TV will go?” or “How the home must have a jet tub in the master” And yes, when I work with buyers there are sometimes these specific requests, but for the most part, people want a home that’s a good investment they can see themselves in and if they found the PERFECT house BUT the nook for the TV wasn’t big enough for their current TV, it usually doesn’t stop them from purchasing a home. So I know, based on some of the little things I stressed in these home tours and put in my wish list, it will be edited to make it seem as if they are a bigger ordeal to me than they actually are. However, I will say these items make me appreciate my house so much more! So I think we all need a far-fetched wish list item achieved to make us reassured about our purchase.

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My hang ups on the show will be: must have a mature tree in the front yard (ok this may be an actual deal breaker for me), built in shelving, gas cooking, a laundry room inside, no converted garages, a large master bath  and my hatred for popcorn ceilings.

And no blog would be complete without a picture of my dog #GoodGollyMsMollyMaltipoo:

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**You bet your butt you will see her on the show too! They definitely wanted to film me baby-talking Molly and saying “we are going to get you a house!” it was awkward to say the least..because while I do baby talk her (I usually do it in private!) Where are my dog lovers at who can relate?!?!**

Now, who wants to be on House Hunters, I know a great Realtor that’s willing to help get you on the show!? ;)

Thanks for reading as always, sorry for the long detailed posts (as usual, but I am not one to skip out on details!).

Paying off Your Mortgage ASAP: Yes or No?

When I first got into real estate, I would sit across the table as my buyer signed all 3 million closing papers for their first home. There came that point where we would make a joke about the “no pay no stay” document and usually a comment of how great of an interest rate they got. (I got into real estate when the market was crappy and interest rates were in the 2% realm for some!!)

Another discussion that always popped up in regards to mortgage payments, taxes, insurance and interest was the “if you make two extra payments a year it knocks down about 7yrs of interest.”

So SHOULD YOU or SHOULD YOU NOT pay off that mortgage early? And should you take that money and invest it?

Here are some pros and cons to both, and perhaps you can figure what works best for you.

housemoneyWHY YOU SHOULD PAY OFF YOUR MORTGAGE QUICKLY:

1. Peace of Mind. Waking up everyday and knowing you own your home out right is a pretty good feeling, may take a while to get there, but it sure will be nice once the bank doesn’t own it.

2. Guaranteed investment return. Paying off that debt early is as if you are earning the interest you would have otherwise paid on it.

3. If you didn’t put 20% down, then you should definitely pay down your loan to the 80% loan to value ratio to avoid that monthly mortgage insurance premium–that will definitely save you money in the long run!

4. And for those of you who usually say you are going to do something….but then well, aren’t so great with the follow through. You may say “I am going to just make minimum payments, let this extra money snowball and invest it” but the ACTUAL chances of you actually doing that are slim to none. So perhaps you are only doing yourself a favor by paying down your mortgage because you wouldn’t have done something smart with the money anyway?

investvspaydownWHY YOU SHOULD NOT PAY OFF YOUR MORTGAGE QUICKLY:

1. If you bought your home at a time with a really great interest rate (or re-financed) the downside to paying off that mortgage is the opportunity cost. You could possibly be giving up investment returns that are better than your mortgage interest rates (you just have to do a little research).

2. And of course there is INFLATION! Consider it. Inflation erodes the value of the dollar. So basically your future mortgage payments will cost less than they do now and the money you are sending in won’t be worth much in terms of “real” buying power.

3. The other thing to factor in are the unfortunate “what if’s.” I would hate for any of this to happen. But if something bad does happen (job loss, crazy medical expenses), what can the bank take?–your home that they still own, right? That’s ok–because you still have a stockpile of money in accounts earning interest. If you had paid off that home that’s all you have, and in turn you will most likely need to sell it to get the money from it or pull an equity loan and borrow against it. HOWEVER if your money was earning 8% in an index fund or retirement account you may have the extra funds necessary to still live and maintain the lifestyle needed. Just a thought.

And a few cool links I thought may be helpful mortgage payoff calculator HERE.

And I also found this article/info graphic of best places to invest. Ummm, so glad I am in Tx (though this vouches for Houston mainly, it was still interesting).

Hope you found this little read interesting, I know it isn’t as exciting as my tips on online dating profiles, but I am busy these days and real estate consumes my mind! Thanks for reading.

-Ashley Brinkman
Realtor, ABR, GRI
Realty Austin
512.665.8787

 

 

 

I Own Scissors, but Don’t Cut My Own Hair: An Agent’s Insight to the Austin, Tx Seller’s Market

Hello there blog readers of mine! (All two of you).

I know you look forward to my blogs about my bad dates and theories of my generation and what not, but due to the non-existant dating life I am going to write about something that has been time consuming lately (and I am not complainin’): Real Estate! So stay with me on my rant and hopefully learn a little about this crazy market we are in.

Currently we are going into Summer Months in Austin Tx and yes, it is still a hot seller’s market, with low inventory, but here is what is just starting to baffle me as an agent….

Just because I own a pair of scissors doesn’t mean I try to cut my own hair (or other people for that matter). And just because I know how to run doesn’t mean I am capable of teaching someone how to train for a race–so why, oh why on Earth if you don’t have a Real Estate License would you try to sell your home on your own???

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Oh you want to save money?…I get it. Well know this–most people who do NOT use an agent to sell their home end up getting less for their home and it sits on the market longer. Not only that, but when you represent yourself you are more liable than ever before. Hello lawsuit!lawsuit

I just want to give this example because I think it is a good (smart) one. My broker calls me into his office to chat recently. Mind you, he has 20 something years of real estate under his belt AND he is a real estate attorney. He says, “Hey I am thinking about listing my house soon and I want you to come take a look and tell me what you think.” I responded puzzled, “Why are you asking me? You know your home and neighborhood and how to sell it.” And he responded with a very honest answer, “You know how sellers are-we always think our homes are worth more than what they actually are. I need an honest, professional opinion. Plus I have a few things I want you to tell me if you think I should paint, stage, where to put things etc.”–all that coming from someone IN the business. While some real estate agents do list their own homes (and in Tx you must disclose if you are affiliated with the selling party or the actual home owner) the last brokerage I worked for would not allow owner/agent relationship, you would sell it under someone else in the office–which is smart.

FSBOI know, I know–you think real estate agents just take some photos, move a few pieces of furniture and stick a sign in the yard and they are done with it. There is so much more to it than that (well for the good agents anyway)! And actually in this market, it is even more pertinent to have an agent with diligence, market knowledge, an agent great at marketing your home in non-traditional ways and has a “pre-marketing plan”, a proactive one that foresee road blocks (like buyer’s financing and appraisal or title issues).

Another example I recently encountered: I am representing a buyer on a duplex. We were in multiple offers. We won. A few weeks later–appraisal comes back higher than contract price! Yessss!! (Always a good feeling to walk in with equity). This listing agent is a discount broker. He didn’t use professional photos and I don’t think he even pre-marketed the duplex. Did we go under contract after only two days? Yes. But do you think if he would have marketed the home more professionally and tested the market price prior to putting it in the MLS he would have had higher offers on the table that would have matched what the appraiser said it was worth? Possibly. (Just a theory, but no way of actually knowing).

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It makes me wonder, though: Does an agent do as good of a job when he/she is taking that big of a discount? And furthermore, if he is discounting himself does he:

1. Value himself as a professional or his time?

2. Is he so busy being a discount broker that he has time to market my home, others and take care of everything?

3. Can he even afford an assistant or professional photographer?

4. Does he even have experience?! Maybe he is cheap because he is new and doesn’t know what he’s doing!?

I am not going to lie, when I first got into this industry, you could have paid me $500 to list your home and I would have been ecstatic–and that was in a bad market!! But as time and experience have taught me: time is money. And my work is valuable.

I will say often to all my friends and clients that trusted in me with their real estate transactions in my wee-early real estate days I: 1. Appreciate you having faith in me and am grateful for your business!!! and 2. I Apologize because I know so much more now than I did then!!

Sadly, that SAME broker from the duplex deal had a sign in the yard of a home I recently met with the owner prior and told him EVERYTHING he should do to get his home ready to market (so he did that, then hired someone cheaper…sigh). So, yes people like to save money, but sometimes it is worth it to pay more, get more and have to do less if you ask me (and that goes with a lot of things in this world, huh?–like a pair of sunglasses, a good cutting knife or a car-for example). A home worth over $400,000 (that’s been owned for almost 10yrs) and the owner thinks it is smarter to save a few by hiring a discount broker. Yes, I am bitter! Don’t get me wrong, I have and still do discount my commission when appropriate to the situation, but I don’t advertise myself as the “1% girl” or “flat fee gal” Some brokerages don’t even allow agents to discount themselves unless it is their own transaction.  I know it is a seller’s market, but I keep seeing people get real greedy or maybe it is high optimism? In fact, last week there roughly 500 price reductions in the MLS (Multiple Listing Service). That is A LOT of price drops. Maybe the market is cooling off? Highly doubtful. Perhaps the overly aggressive pricing is starting to correct itself.  Sometimes we agents have to stand behind our work and listen to the words of L’Oreal: “You’re Worth It.”

You’re darn right I am!

youreworthitIn this world of Wiki, Google, HGTV I guess we are all experts. And in a town of 7,000 real estate agents or something crazy like that, I guess there are a lot of people to choose from. Be smart out there folks, do your research, and shop: rates, agents, plumbers, insurance–everything–you will be glad you did in the end. And just because it is the lowest price DOES NOT mean you are getting the best value (think we all know this by learning a lesson one way or another).

htvfunnyYou can find more about Ashley by clicking here and you can start your Real Estate home search here! Realty Austin has fantastic agents to help you find a home, guide you in the process and a great support team to help market your properties to get them SOLD! Also voted Best Places to work in Austin three years in a row according to the Austin Business Journal!

What to Expect when Buying New Construction (in an Austin seller’s market)

Hello again!

I’ve had a few clients in the past few years buy new. Meaning from a home builder or custom builder or condo developer. And being that I now have gained some experience on “the other side” (meaning, representing new projects/the listing agent) I wanted to take some time to write a blog on what to expect when purchasing a new home (in a seller’s market). I add the parentheses because when the market is “bad” or a buyer’s market, builder’s are offering incentives, upgrades, decorating allowances, raffles for a new car. BUT in Austin Tx currently we are in a seller’s market, with this inventory being low, what can you expect as a buyer now that housing is in demand? Well..read on!

Since every builder contract is different (and none of them are the standard TREC <Texas Real Estate Commission> promulgated form) I am not going to go through the nitty gritty details, but basically give you a sum up of what to expect in that contract and when building a new home (or buying one from a builder that is a “spec” home). A spec home is a homet hat has already been started by the builder-lot, floorplan and decor already chosen. Most the time when you choose to use a builder to buy you pick the lot, floorplan and then go to a design center for upgrades etc.

(and use some real life examples!)

Below: Jordan at the closing table-yes, he sent me a selfie, because I couldn’t make closing! Bought his new place in Edgewick, stand alone condo with detached garage! soldJordan

This is a photo of Ashley, below-just closed on her home with Milsetone Builders off Riverside that was built from the ground up-with her input! That area has blown up, she is so happy she bought there when she did!

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#1–A Builder’s contract will state that they are allowed to make changes to the property as they deem necessary.

This is important to know, because recently I had some clients (ok, pickier than normal clients) who were very angry that the developer said there would be 4 trees (according to the brochure) and there were only 3 actually planted. These things happen. Does a builder try to purposefully deceive a customer? Of course not, but often times what “they thought” would work, doesn’t once they cross that bridge.

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#2–a Builder’s contract is going to cover THEIR butt, not yours. Basically it will state things (in legal jargon) like: the builders have up to xx amount of years to complete the project.

I have another client who was supposed to close in October, ok November, ok late December….well you get the idea, it is March 2014 and we are still not closed.  This definitely has put a cramp in her lifestyle (and wallet, as rent continues to increase-especially when you go month to month)

Now, does a developer or home builder purposefully try to deceit people or make unrealistic timelines? Absolutely not. Do they want to sell the homes as quickly as possible? Of course. But it happens quite often that inspections hold up, Texas has freeze days??, labor shortages, City inspection hold ups (again), permits expire (or they don’t really but some dummy in the office doesn’t know what he is doing) and so on and so forth. Delays are constant. I wish they weren’t, but I have NEVER had a builder complete in the amount of time they said they were originally going to finish a home in. I promise. I wish it wasn’t so, but just the way things go.

So the #1 characteristic you have to possess (in my opinion) going into a new build is PATIENCE. Projects always take longer than anticipated, possibly a few changes along the way. I have been telling my clients (in this busy seller’s market) it is easier to sign a six month lease while your home is being built and break it/sub lease it later in this hot renter market, than to continue to pay increased rent prices month to month.

#3 A Builder almost NEVER pays Title Policy.

If you have bought a home before, more often than not a seller will pay for the buyer’s title policy. Now, in this hot seller’s market, there have been times when I have advised buyer’s to pay for the title policy to have the edge over another offer, which has worked to our advantage. I have only seen a builder for a new home/project pay for a title policy (which usually equates to a little less than 1% of the purchase price) maybe twice. Have I tried to negotiate this almost every time? Of course! But the advantage a new home builder has is that his product is rare and if it is in a buyer’s price range and they REALLY like it, they will pay the title policy vs back out completely. In the times the seller has paid for a title policy, I will add– the buyer didn’t ask for any other concessions, appliances, had strong financing and was at the asking price. So there ya have it.

DSC_0048Above: finishes the buyer’s get to choose at a project I am listing (Towns on Cumberland)

#4 A Builder will have little to no incentives for you as a buyer.

I say rule #4 with the intent of someone understanding the current market state, especially in Central Austin. As housing becomes scarce, pricing has increased and incentives to get people to buy have decreased. Why? Because a builder doesn’t have to offer allowances and upgrades when his product is in demand. I am not saying it doesn’t happen at all, it does, but usually at the start of a project. Asking price is usually final unless a builder is at the tail end of his inventory and ready to close up the project.

Some examples: I had a buyer purchase from Pulte up in North Austin. If he signed by the end of the week he would receive $2000 extra in his upgrades. Done.

Another builder (and most builders, honestly) will have a preferred lender. Do you have to use this lender? No. But most likely the builder will have established a working relationship and the lender is already familiar with the project, the people and have solidified a routine to get the loan done. For using their preferred lender the builder will most likely pay title policy or offer some kind of closing costs paid for at the close of the loan, etc.

drwallSansoneProgress (this home finished months after it’s projected date–it happens).

finishedSansoneBut buyers are super happy with the finished project (couldn’t even fit the whole house in my wide angle lens): Teravista, Round Rock by Partners in Building

However, neighborhoods perhaps farther out in a VERY newly developing area that may take years to grow etc. could possibly be offering more incentives and bonuses for your extra long commute and factor incentives for you. The fact you will be living in a construction zone for the next few years–you deserve a few upgrades. There are pros, however to buying further out– If you can hang tight in this busy market, you will be happy with the equity you start to acquire in your new home. You need to make sure you want to be there for a while, though, because often times if someone tries to sell a year later the home is worth just as much as a new home down the street. Be sure you pay attention to “what is to come” and what “can’t” be put next to you, too!

I hope this blurb about what to expect doesn’t sound like a “crappy deal” or like I am being pessimistic. I consider myself a realist, ha. I also hate when I don’t fully explain to buyers what they may run into when buying a new project. This isn’t to discourage one of NOT buying new, but just educate one on how it can be different from purchasing from a seller. Buying new can be great! Modern finishes, the ONLY one that has lived in a place, your own finishes (tile, backsplash, flooring, constructed floorplan) all picked by you. A new community with like-minded people in an up and coming (or already established, hip) area. Do what is best for you, but know what you are getting into!

resizedSome buyers prefer to buy old charm and fix up (Heidi and Brian above)…

JT4And some prefer starting their family in a new home (Jennifer and Travis above).

But whatever you decide, be happy with your new home!

Start your home search here and register! Read more about Ashley here and how she can help you with your real estate needs!

Happy house hunting, let me know if I can be of help and as always, thanks for reading!

-Ashley

The Easy Life of Being a Real Estate Agent (or so you think?)

An Inside look at what being a real estate agent is all about (for me, anyway).

No, it’s not rocket science. I don’t work 80hrs a week like a lawyer, and I don’t save lives. But I wear a bunch of hats and it can be stressful, unstable, time consuming and plain exhausting. So, hear me out.

Randomly this week, the exact same day, actually, I got two messages from  facebook pals that wanted to have coffee with me and pick my brain about being in real estate. Over the past few months I have met several people who were referred or wanted to chat about getting into the business. If you follow my facebook, or my instagram, or you just know me–you will know that:

1. I am pretty honest and

2. I keep pretty busy! So I thought I would take the opportunity to write some pros and cons and an HONEST reflection of what being an agent is like, and possibly de-bunk a few myths.

1. Myth #1: Real Estate agents just roll in the dough. Some do, sure. They also most likely have been doing it for more than 5yrs or may sell luxury with bigger pay checks at closing. What you forget is HOW LONG and how much time, money and energy it takes to get to the point of “rolling in the dough” Just like with any start up business, real estate is like that. You start operating as a business.

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The average real estate agent makes $5k their first year of real estate. Yep. Can you live off that? I can’t. I always tell people who want to get into real estate either–be prepared to have a second job (I waited tables nights and weekends when I first got into real estate and tried to be at the office in the day, on top of showing houses and leases on weekends etc). OR you better have at least a year of savings to live off and live frugal as you build your business.

Let’s break out the numbers a little, a brief example if you will: Your friend wants to buy a house (Yesss!) And they trust you to handle their transaction. After three months of looking you sell them a $300,00 house.

Great. $9,000 in your pocket right?

Wrong.

Let’s say your broker takes half because they give you an office and signs and a lockbox and marketing. There is also probably a transactional fee, franchise fee AND errors and omissions insurance. But for number’s sake we will keep it at half going to those items.

So now you have $4,500, right?

Wrong.

That isn’t taxed and you are self employed now, so take 20% of that and pay the IRS or put in an account to pay taxes quarterly. So now you have $3,600 right?

Wrong.

You have to always invest in yourself, they say on average about 10% should be for marketing, so $360 (which only pays for one mail out of post cards that tell everyone in that area you just sold a home) So there ya have it, three months of weekends and evenings showing houses, setting appts, using your gas, putting miles on your car for $3,200 in your pocket.

BUT don’t forget health care. There are no benefits when you are with a broker. There is no 401k matching like in the corporate world oh no, no, no. You basically have to become (or invest in) a CPA and financial planner because you are now running your life and finances like a small business, and perhaps some of you already do-which is great.

 

2. Myth #2: Real Estate Agents just stick a sign in the yard and take photos and boom it is sold, easy money.

Listings are not an easy item to obtain. They not only take knowing the right people, continuous marketing to specific areas, researching sold prices and activity, viewing houses in the area, setting up property tours etc. but someone is paying you to sell their home–Most likely their number one financial asset.  Let that sink in. That’s a scary thing when looking at the big picture. What if you price it too high and it sits forever? What if you price it too low and they needed more for it? What if you didn’t do your due diligence and cross all your t’s and dot all your i’s on the contract? Or forget to disclose something you were supposed to and now the new buyer is having issues…who will they come back to sue?

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When I first got into real estate I thought: “I know so many people, surely they will work with me.” Not the case. There are somewhere around 9,000 agents in Austin!! I have heard statistics that we have more licensed agents per capita than any other city (cat has been out of the bag on how hot Austin is for a while now). Growing a thick skin became part of the job. Finding out some of your best friends got married and bought houses through people they saw weekly at church or lived across the street from a Realtor was a tough, but realistic part of the business. I always thought well maybe I shouldn’t tell them I am still working my second job. I would think: “No one wants to work with an agent who has to have another job. Don’t they know I am busting my butt trying to make it in this business?!” Time. It all takes time, persistence, and experience. It is hard to get that first deal, but when you do (and mine was a $90,000 condo on the east side) it is such a good feeling, but the momentum must continue and the steps that lead to success are more than I care to go into right now, so I will spare the details.

Like most economic models, I would say 90% of the agents make 10% of the money and the top 10% of agents make 90% of the money.

For me, it isn’t about the money as much as it is about helping others. And it isn’t always the easiest, but if I can help them in some way–a referral, selling them their first home, walking them through the process, telling them where they should go eat–and if they are happy. I am happy.

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3. Myth #3: Real Estate agents make their own leisurely schedules and don’t even work 40hrs a week!

I will agree that some of the more successful agents possibly don’t work 40hrs a week, but that’s because at some point in time they put in 60+ a week and now pay salaries of 3 people working under them.  But being a real estate agent is much like any entrepreneur. And Austin is a city that is full of them. Any one you know that has a successful business didn’t get there by slacking off and watching Ellen every day and sleeping in. Definitely not. And once you get going in business you don’t really want to stop. (OK a few agents I know are totally content with a few deals a month, and don’t want to grow and expand their business–but it is rare).

I know I feed to this myth because I post facebook photos of me traveling to countries, US cities, going to concerts, making gift baskets for clients, grocery shopping in the middle of the day. Are all these fabulous items perks of making my own schedule: ABSOLUTELY.

WHAT YOU DO NOT SEE: I sometimes stay up until 2am on the MLS or brainstorming about business or getting caught up on an expense log or mileage (if you are a client reading this you probably know, because have received an email at 1am of a property you might like or a reminder of some sort). I have never been much of a morning person and find I “get in the zone” with little distraction and lack of cable, to where I can get things done late night (sadly).

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You also do not see me taking phone calls while on vacation, managing things when “shit hits the fan” constantly checking email. I have been on trips with friends where I get that “roll of the eyes” because I am on the phone, writing an offer, answering a question and not helping load the van for camping or enjoying the baby seal watching on the beach. It’s a balancing act- despite balance always being an idea, but not really ever achievable.  I also always have to make sure I have wifi wherever I book (and usually I take a little time to sit down and get work done and check in with clients etc while I am away). Can I hire an assistant? Sure. But the other issue with being your own boss is 1. No one does it like you do ;) and 2. You have to pay an asst.–so you better be at the level that you can afford to pay someone to help (one day….one day). This again takes TIME like with most successes in life.

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I try to remain  positive in life in general (sure I rant, ha see last blog post) but I also think of myself as a realist.  I try to depict positivity for my work life/ethic, and to be honest–it isn’t always sunshine and rainbows. But who wants to work with an awful/negative person??

There are hiccups.

There are disappointments.

There are angry client emails frustrated with builders or lenders and taking it out on you.

There are legal items you have to be aware of or they can bite you in the butt and come close to being sued.

There are things you just flat out don’t know and beyond your scope of experience that take time or research, and finding someone who can help you help your clients can be a challenge. EVERYONE is busy.

So while my travel photos and happy client photos may seem all peaches–sometimes there was a dark, rocky road before we got to that point. If you are a people pleaser, it may not be the best career for you, because as I mentioned before–the skin has to grow pretty thick. We can waste a lot of time and energy pleasing others and bending over backward for them, when really they are never going to be happy anyway.

As a side note: My life looks pretty awesome because, well, it is– but it is just me. I have no kids to mother, no day care/school/clothing expenses…my mouth is the only one to feed. I have no husband to take care of or plan my schedule with. It is just me! I look up to successful agents that somehow manage 3 kids, still managing to cook for them, run the house, still make time to train for half marathons, run a business, take vacations and get it all done, it’s impressive and I hope to one day be at that level.

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I certainly didn’t cover all the bases and don’t want to bore (or scare) you with the nitty gritty details, but hopefully I provided enough insight and de-bunked a few myths of #realtorlife. Thanks for reading.

DISCLOSURE: Listing a Home after you have seen an Inspection Report

Here is the best way to go about listing a home, when you have been shown (the first) buyer’s full inspection report.

I had an event happen recently that has inspired this little blog on DISCLOSURE.

I am already an honest person, at times I say to a fault, but when it comes to housing, I don’t think you can ever say too much. Representing a seller, you want to address ANY issues that could eventually come back and haunt you or worse…sue you.

I put a nice little 3/2 one story home in Milwood (7016 Riverton) on the market a few weeks back. Milwood, with it’s great schools and location near the tech corridor, couldn’t be a better location for some and the price is definitely affordable. We didn’t even have it on the market before I had calls on it (beauty of pre-marketing to other agents and “Coming Soon” signs). We had showings before it hit the market. And offers in three days. Austin is in a great spot right now, especially for sellers. We are priced: Affordably, and that is hard to come by as prices are on the rise.

After our inspection report came back, as predicted there were maintenance items needed, updated items needed, a few safety issues–and this is all standard, especially for a 30yr old home. Inspection reports can be scary for buyers. It’s rare that a home is “totally clean.” There is always something–and that’s ok…we were to work through it.

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Often times what is deemed important to one, is not always important to another. In this instance the buyers had asked some items serviced, cleaned, repaired etc. And after days of conversations and email lists and bids, ultimately we just couldn’t agree. And that is OK too. I have represented plenty of buyers to know that–after you spend money buying a house, you don’t really want to spend any more fixing it to your standards or doing things you felt should have been done or maintained. Now, while I usually recommend a seller get a report before putting their home on the market, there’s also nothing wrong with having the buyer pay for one and addressing the issues after either. The pro to purchasing one before listing: You have time to address and fix, and not have to waste time if you have to go back on the market after you lose a buyer. The cons: Paying for it yourself. And what you may deem as a “NEED TO” type items, the buyers may have other plans in mind.

So here we are. Off the market. Buyer and seller couldn’t come to terms. We now have the buyer’s inspection report, a list of bids, desired items to be fixed, notices of what’s been broken. What is next?

Disclose. Disclose. DISCLOSE.

I am grateful to have reasonable sellers who now are taking the time to address these items before we put it back on the market. What do we tell buyers who are looking now? Exactly what we found in the report. I think it is in good practice to do the following, when putting a home back on the market after being exposed to the buyer’s inspection report:

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(Home above the one I am writing from experience in this post, 7016 Riverton, Austin Tx)

1. Market home with an updated seller’s disclosure (this is required in Tx, so as a buyer, you should see this with almost every home you purchase, exceptions being foreclosures and a few other specific cases).

2. Re-filling out the seller’s disclosure with noted sections referring to first buyer’s inspection report, what has been fixed, and all you now know, or referencing an attached list of items/explanation.

3. Invoiced and warranty work.

Last year I had a seller that was a bit of a pack rat. Now, in most cases this is usually a bad thing when it comes to listing houses BUT this seller put every single piece of documented paperwork in an accordion file for the house. It was great and I HIGHLY recommend it for all you home owners out there. When it comes time to sell, you don’t have to scratch your head and think-did we have the AC serviced in 2008 or 2009? Rather you have all the paperwork to prove it. I also think there is nothing better than for a buyer to get a stack of paperwork on how to operate the sprinklers or alarm systems. (As an agent I have had to go online and find a model number and manual and send to my clients before, and it is much easier to just give it to the new buyer, I also think it shows-as a seller-that you appreciate the buyer and you took care of the home and its contents).

IMG_1639(House above I sold last year and seller had everything in a binder for me-win!)

I also can’t express enough how assured it makes buyer’s feel to get a transferable warranty. And when it comes to “foundation” that word alone scares buyers, but not when you have structural drawings, invoices and warranties to back up what you did for your home. So in this instance-KEEP YOUR PAPERWORK!

4. Photos and/or a list of the items you had repaired.

This is just a little bonus I think is good to point out to potential buyers to help them understand what was addressed. My clients took photos of the work that was being done (as photos are in inspections) work completed is helpful too!

5. First Buyer’s Inspection report. Now this is debatable among agents. A buyer paid a few hundred dollars for this inspection report, why would they want to share it with anyone else? Well, when they gave it to the seller, the seller now has the obligation to disclose.

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Questions about the Inspection Report being Public:

Did I post the inspection in the MLS when we put the house back on the market? Absolutely.

Did the buyer’s agent ask me to take down the inspection? Yes.

Did I HAVE to take down the inspection? I did not. I have the obligation to fully disclose the defects found in the home. Even if the report read “for Buyer B’s use only” that full report was handed over to my seller, thus legally we must disclose.

Did I take down the inspection anyway? Yes, as a courtesy. I still disclosed to any interested parties. I know that in the past as a buyer’s agent, I don’t necessarily have to give the full report, but perhaps a list of items I want addressed or maybe just the certain pages pertaining to our concerns in the report. Not always the best way (because the report has explanations and photos) but certainly helps.

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When I first started to write this post we had just taken the listing off market….

Finally getting around to finish writing the post and we have already fixed and addressed all safety items in the buyer’s report and put it back on the market, had showings all weekends, phone calls, and a VERY successful open house, then we went under contract again after being in a multiple offer situation (again). Here we go. I look forward to a smooth, honest, transaction. Having my sellers in their new to be built home in Mayfield Ranch and the new buyers with their little one, settled in by Christmas as well.

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As always, thanks for reading. Hope you found this post informative and not too boring ;)

-Ashley