April Market Update & Newsletter

This real estate market is ever-changing and evolving and the only constant we’ve come to expect has been change.  That has not been the case for large stretches of my 35 years in the business, but it sure is now.  In March, a landmark case involving real estate commissions had NAR offer a potential settlement to the Plaintiffs for $418,000,000 and two changes to our business.  These two proposed changes are: (1) agents must sign a buyer agreement before showing houses.  The agreement outlines what the roles and responsibilities of each party are and how agents get paid, and (2) all MLSs can no longer display buyer compensation as a field in their displays of listings.

In Virginia, it has been the law for more than a decade to have buyer agreements signed after the first substantive conversation about real estate.  At the time of the proposed settlement, only 18 states required signed buyer agreements.  This practice is a good thing in my opinion and I welcome its inclusion on a national scale.  The second proposal has added a lot of misinformation provided by–you guessed it-the media.  Headlines are deceiving and often just plain wrong.  Real estate commissions are not going away.  They may be paid differently depending on how the seller chooses to offer compensation, but real estate agents will be paid because, as we all know, no one works for free.

Another misnomer is that prices were driven up by our fees.  Nothing could be further from the truth.  Market conditions drive up prices, not our compensation.  When the Fed lowered its rate to zero because of the pandemic, this caused mortgage interest rates to drop to the 2.25-3.5% range for an extended period.  This caused a feeding frenzy on any house that came on the market, and prices escalated dramatically.  This had nothing to do with our commission rates.  Then, the Fed increased rates drastically because the avoidable rise in inflation was killing peoples budgets and retirements.  These market distortions resulted in the mortgage rate lock for people in a house that they would otherwise like to move from, a condition that I have written and blogged about extensively over the last two years.  This lock, in conjunction with more people aging in place, has lowered inventory to historical lows.  As we know, low supply and high demand results in higher prices.  The market drives prices either up or down, not this settlement and more importantly, Realtor fees.

Prices will not come down because of the settlement-the market has, and always will, dictate prices.  The headlines declare that commissions are now negotiable.  In point of fact Realtor fees have always been negotiable.  With this settlement and the corresponding buyer agreements needed, many people believe that sellers will no longer offer buyer agent compensation.

Sellers pay the listing agent a fee and allow them to offer part of this compensation to a buyer agent.  Many sellers have said they were not aware of this and feel if they understood it, they wouldn’t have allowed their agent to pay someone to negotiate against them.  Agents need to do a much better job of explaining paperwork, the process, and what to expect as they progress to settlement.  This will result in a more professional and streamlined experience, in most cases.  If the seller does not allow compensation to be offered to a buyer agent, the buyer will be responsible for paying their agent directly.  This will be a fundamental switch and many more conversations need to take place between agents and their clients about the pros and cons of offering compensation and the impact to their bottom line and the marketing of their home.  Time will tell if the sellers make concessions, lenders will change lending rules to allow buyers to pay their agent, especially if they are a VA, FHA, or USDA buyer, and many other changes…stay tuned.  Things will shift a LOT but I will of course keep you informed.

As always, I am available to speak with you about any of these changes and how they affect you if you are a seller or a buyer.  Don’t hesitate to reach out, as I’m never too busy for you!

It’s a good life.

Chris

 

3 THINGS THAT MAKE THE HASSLE OF HOMEOWNERSHIP WORTH IT

 Christy Bieber | Motley Fool | Read the full article at fool.com

Buying a home comes with a lot of upfront and ongoing costs. It also comes with a lot of responsibilities. Not only will you have to commit to paying a mortgage loan, property taxes, and insurance, but you’ll also need to take on the cost and responsibilities associated with maintenance and upkeep. If something goes wrong, you can’t just call a landlord — you have to handle the issues on your own. Despite these hassles, owning a home can be well worth the downsides. There are a few key reasons why that’s the case.

    1.  Homeownership can help you build wealth

The single biggest reason homeownership is worth the hassle is because owning a house can help you build wealth. When you make monthly mortgage payments, a portion of that goes toward principal and helps you build home equity. You eventually own your house and have an asset that’s worth hundreds of thousands of dollars. This isn’t the case if you rent. Your monthly mortgage payment is essentially a type of forced savings, while your rent just buys you a place to live.

As you live in your house, it typically goes up in value each year. This property appreciation also helps you build wealth since you’ll end up owning a more valuable asset over time. These big financial benefits help explain why homeowner wealth is 40 times higher than that of renters.

Now, this doesn’t mean you can’t get rich by renting. It’s definitely possible to do so. But you’ll need to be a lot more diligent in how much you invest since you won’t be acquiring an asset automatically via monthly housing payments.

    2. There may be more choices of homes for sale than for rent

In many cases, you will have a wider selection of homes to buy than homes to rent. Rental properties tend to be mostly apartments or condos rather than single-family homes, and they tend to be more concentrated in urban areas.

    3.  You can customize your house to your liking

Finally, the last big benefit of homeownership is the ability to customize the property. You can invest in making the space your own in a way that you would not want to do if your money was improving the landlord’s property instead of your own. You also don’t need to get permission to paint or change the kitchen cabinets or do anything else you’d like.

These three big benefits of homeownership make it well worth the hassle associated with owning your own place. But before you buy a home, you need to consider the pros and cons. If you don’t want to commit to staying in one place for a while to build equity, or if you don’t want to take on the responsibility of maintaining a home, renting may be a better bet for you — at least for a while.

Always weigh the pros and cons of being an owner carefully before you decide whether to move forward with buying a property of your own. It’s a big decision that can affect you for years.

 

Recipe of the Month

Sheet Pan Garlic Shrimp

Yield: 4-6 Servings ~ Total Time:  20 Minutes

INGREDIENTS

  • 2 pounds extra large or jumbo shrimp, peeled and deveined, thawed if frozen
  • 2 tablespoons olive oil
  • 1 teaspoon salt
  • 1 teaspoon black pepper
  • 2 large cloves garlic, minced
  • 4 tablespoons unsalted butter, softened
  • Pinch freshly chopped parsley, for garnish (optional)
  • Lemon wedges, for serving (optional)

DIRECTIONS

  • Preheat the oven to 350°F.
  • Place the shrimp on a baking sheet and toss with the olive oil, salt, pepper and garlic.
  • Roast for about 8 minutes, or until the shrimp are pink and just cooked through. Immediately add the butter directly on the hot baking sheet and stir until melted.
  • Transfer the shrimp and butter sauce to a serving dish and sprinkle with a bit of fresh parsley, if desired. Serve with lemon wedges.

 

6 WAYS TO IMPROVE CURB APPEAL BEFORE SELLING A HOME THIS SPRING

Read the full article at news.remax.com

As daylight lingers longer and temperatures begin to rise, it’s evident that spring is on its way. Spring is generally a busy season for real estate, as homes hit the market after a hunkered-down winter and ahead of summer fun. In many places, winter weather can take a toll on the exterior of a house. Before listing your home for sale this spring, consider these tips for improving curb appeal and charming prospective homebuyers.

Remove old leaves and debris

Toward the end of winter – when snow is officially gone for good – lawns can be littered with leaves lingering from fall,  as well as twigs brought down by storms. Removing them is  important before starting on lawn revitalization, as debris will block seeds and nutrients from doing their job. Don’t forget to clean up flower beds or other non-grassy areas too – these places are also prone to collecting leaves. And make sure to clear out the gutters. Not doing so can lead to roof leaks and other issues that could have negative repercussions on a home inspection.

 

Get the grass growing

Once the temperature is staying well above freezing throughout the night, it’s time to get your outside water lines and sprinklers going again. Carve out time to get the system running again before you need it – or reach out for professional assistance. From there, assess what else your lawn needs. This could be patch-fixing, overseeding, providing nutrient-rich grass food, or aerating, among other measures.

Add a new coat of mulch

A fresh coat of mulch along edges and around plant beds can help a yard look cohesive. If you want to shake up your exterior color palette, try a different shade of mulch. For example, red mulch provides a nice contrast against the vibrant color of plants and  flowers. But, if you have a red home or brick home, the red may feel too monochromatic, making a muted brown shade a better match.

Clean up hedges, edges, and more

Take time to trim back trees and other plants that appear overgrown. This is especially true for large trees that canopy over a  property, and smaller trees and bushes that line the house or yard. For a well-manicured appearance, edge your walkways – especially the one leading toward the front door. These small details work together as polished curb appeal.

Consider the state of the structure itself

The physical exterior of your home could likely use some TLC following winter, too. Depending on the accumulation of dirt, it could be time to pressure wash the siding. Then, while it can be a more costly task, having the house repainted adds an element of newness and could make a substantial impact on the impression of prospective buyers.

Add pops of color

Spring is the season where nature blossoms – so help emulate that cheery feeling as people catch a first glimpse of your home. Add a pop of color to the front porch with colorful planters framing the stairs or door. Plants and flowers are a great way to add bits of color here and there. Just be sure to water them regularly, and according to their species, to ensure they stay vibrant all season long.