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Bob Kienast's Blog

Buying and Sellling a Home in Parma, Parma Hts and Seven Hills, Ohio

By Bob Kienast | Agent in 44133
  • The "Yeah, But..." Defense

    Posted Under: Home Buying in Parma, Home Selling in Parma  |  November 4, 2011 6:59 AM  |  1,307 views  |  No comments

    When working with a client, I always dont like the phrase, " Yeah, But..".  From the buyer's side it's usually a case of,  " Yeah, But we haven't seen everything in this price range", or "Yeah But I'd like to offer $20,000 under asking price".  From the seller's side it's typically a case of " Yeah, But our house is the nicest one on the street", or " Yeah but Joe's house didn't have a drain in the garage."

    The Yeah But defense rears it's head when a client is confronted with an unpleasant reality.  Like a Market Analysis that shows an unfavorable likely sale price for a seller, or the fact that a home really is priced fairly, for a buyer.  More often than not this reaction will cost you an opportunity.   A low ball offer may make you seem less than serious, and may not even draw a counter offer.  You will probably NEVER get to see EVERY house ( especially in Parma ) and letting a good one dangle out there too long will can end up with it being snapped up by another buyer.

    The seller's Yeah But usually results in another cliche, the "Let's Try It " price.  The issue here is that a property always creates the most interest when it's new to the market.  The Let's Try It price usually causes prospective buyers to say, Yeah, But it seems overpriced.

    A good agent will do his or her due diligence and bring you good information.  Remember, the only person who wants the deal to go through more than you, is your agent.  Take advantage of their expertise and make good decisions at the start.  This way, you won't have to listen to your Realtor say, " Yeah, But I told you that would probably happen".

    To keep track of activity in Parma, Parma Heights and Seven Hills, "Like" my Facebook Page.
    https://www.facebook.com/sellmyhomeparmasevenhills 
  • Why Try to Sell in the Winter?

    Posted Under: Home Selling in Parma  |  October 25, 2011 5:06 AM  |  1,286 views  |  No comments

    Whether your home has been on the market all year and is about to expire, or you are trying to decide whether to wait till spring to sell or find an agent to help you sell your home now, many people ask the question, Why try to Sell in the Winter?

    I'm sure we've all seen people jogging in the spring, summer and fall months and don't take much notice.  BUT, when we see someone jogging in the winter the reaction is, that person is a SERIOUS jogger.  Same goes for buyers.  There are generally less of them in the winter, but the ones that are out are more serious.  Leases expire at the end of the year, some people are expecting wage increases or income tax refunds or bonuses.  For whatever reason, winter buyers are generally more motivated.

    From the buyer's side, no one can be sure what will happen with interest rates.  Every up tick of the interest rate erodes someone's buying power a little more. ( see my previous blog regarding buying power and interest rates for examples.)  The bank owned homes that are so attractive the rest of the year don't show nearly as well when they are cold and dark, and the possibility of frozen pipes and plumbing issues are more evident.

    From the seller's side, inventory is down. ( Not everyone will be as smart as you are and use the "off" season to their advantage. ) Less homes on the market makes yours stand out.  Some houses look more like "homes" during the holidays when they are decorated and cozy.  The internet makes it easy to preview property  without venturing out into the weather, and there are less properties to preview !

    Real Estate sells year round.  An agent with a good marketing plan can keep your house available over the holidays, without interfering with your family celebrations.  What better way to ring in the new year than with an accepted offer !

    If you are following the real estate market in Parma, Parma Heights and Seven Hills, you can "Like" my
    Facebook Business Page , https://www.facebook.com/sellmyhomeparmasevenhills ,  I will post community and real estate info on these communities on this page. 

  • Follow me on Facebook

    Posted Under: Home Buying in Parma, Home Selling in Parma, Property Q&A in Parma  |  October 20, 2011 4:55 AM  |  1,353 views  |  No comments

    If you are a social media fan and you are looking for another way to keep up with Real Estate in Parma, Parma Hts and Seven Hills you can "Like" my new facebook page :

    https://www.facebook.com/sellmyhomeparmasevenhills

    I post tidbits of information on the local Real Estate Market in the tri-city area and use it as a forum for comments and questions.

    If you are interested, just click the link and then "LIKE" the page and my updates will appear in your feed.

    Hope to see you soon on Facebook !!
  • Rent vs. Own a simple overview.

    Posted Under: Home Buying in Parma, Home Selling in Parma, Financing in Parma  |  October 18, 2011 11:30 AM  |  1,385 views  |  No comments

    Last week we took a look at buying power.  This time let's look at Rent vs. Own.   As a general disclaimer, let us assume that you can first QUALIFY for a loan, and that your credit history allows you to take on a mortgage.  This discussion is limited to single family homes, not apartments.

    The average single family rental in Parma, Parma Hts or Seven Hills will fall somewhere between $900 and $1100  a month.  We will also assume for the sake of argument that you will be covering your utilities, perhaps minus the water and sewer bill.  Assuming gas heat plus electric on budget you can easily add $200 a month, bringing your basic living costs to between $1100 and $1300 monthly.

    The average asking price for a home in the three Suburbs is hovering around $120,000.  If we use last weeks example of a $751 monthly payment, plus our utility assumption, it will move the monthly expenses to about $950. Now of course you add insurance and property taxes to the mix which will boost the payment another $ 250 a month which brings us to $1200 and what most folks will call the dead end.

    Lets look more carefully.  First off, the relatively low mortgage payment off sets a large portion of the property tax and insurance cost, and we actually fall well within the range of the basic cost of renting.  Secondly, we are overlooking the most important advantage of home ownership.  The Tax Advantage. The interest on your mortgage is deductable on your 1040 form.  So especially for the first 10 years of your mortgage, this amounts to the lions share of the payment.  The tax savings on a $150,000 mortgage amounts to about $100 a month in tax savings. There is no such benefit from renting. PLUS...you are building equity in the property, and hopefully since you are buying literally at the bottom of the market, any sort of increase in valuation would increase your equity stake in the property.

    THESE ARE GENERALIZATIONS.  Always confer with a Mortgage and a Real Estate Professional before making decisions.  Know all your expenses before making a move.  I am only trying to illustrate, that for the well prepared renter, buying may be an attractive option.  There are many opportunities to purchase undervalued properties these days.  Have a face to face meeting with someone to help you crunch the numbers and see if Renting Vs. Owning is an option for you.
  • What is with these interest rates?

    Posted Under: Home Buying in Parma, Home Selling in Parma, Financing in Parma  |  October 13, 2011 5:40 AM  |  1,403 views  |  1 comment

    This past week, 30 year fixed rates dropped below 4% for the first time in over 50 years. 
    For example, this means that a $150,000 mortgage taken over 30 years would be about $715 a month.  Despite the historically low rates, existing home sales are still stagnant and there seem to be a lot of potential buyers staying on the sidelines.

    The "Move Up" buyer seems to be most affected.  Statistically speaking, a family considers a move every 5-7 years so this is the home owner who bought during the boom in 2005, 2006 and would normally be ready to move up from their starter home.  Many of these home owners are upside down on their mortgage ( owe more than the home's value ) and are unable to take advantage of the combination of price and interest that should make this market so attractive.

    If (and that's a big IF ) you are able to make a move now it is an EXCELLENT time to do so.  Consider the following.

    • Yes, home values are down.  But this also means that your BUYING power has increased relative to prices and interest rates.  That same $150,000 mortgage would have cost you almost $900 back in October of 2005.
    • Although the drop in home value will certainly affect the price you can expect to get for your current home, it will also obviously affect the purchase price of your new home. If we consider only a 10% reduction in home value since 2005, ( so that I can do the calculations without a calculator )  Your $120,000 starter home may only be valued at $108,000.  OUCH !! to be sure.  But then look at the other end.  Again speaking statistically, buyers tend to buy up about 50% on their current value.  So that $180,000 second home is now valued at $162,000 !! 

    These are only raw numbers, and everyone's situation is different.  However, if you are in a situation where you are considering a move up purchase, it may be worth looking into.   

    PLEASE PLEASE PLEASE..don't venture into a transaction blindly.  Get all your financial information in order, get all your numbers and scenarios up front, Hire an experienced agent to help you with the transactions ( preferably me ), and use a reputable mortgage and title company to put the deals together. ( preferably Howard Hanna mortgage and Barristers Title. )

    I hope you have found this information valuable.  Next time we will look into buy vs rent and the 1st time buyer.



     
 
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