What real estate agents do for buyers By Michele Lerner of Bankrate.com

Homebuyers, including first-time buyers, usually use the Internet for the preliminary work of finding homes for sale and collecting information on neighborhoods and recent sales. But those buyers, particularly if they are first-timers, often use real-estate agents to identify long-term value in properties, negotiate prices and ensure that deals go through. (Bing: Information on buyer's agents)

Functions of real-estate agents
"Many first-time homebuyers will not be purchasing their dream home as their first place, and (they) often have difficulty seeing the true value in homes," says Ben Hoefer, a real-estate agent with John L. Scott Real Estate in Seattle. "Since many of these buyers will be moving in the future, I think it is a good idea to think about resale when the buyer is purchasing. Buyers may not be aware of things like the problem of living on a busy street, or know to check on issues with homeowner-association covenants."

Hoefer says a real-estate agent can point out potential issues that could affect the resale price of a home and suggest small changes to increase the home's value.

• Money: Should you rent out a room?

"I have a three-legged approach to working with buyers," says Mark Lesses, an associate broker and vice president with Coldwell Banker Residential Brokerage in Arlington, Mass. "I start by getting to know what the buyers want by picking up on the hidden signals that a prospective buyer shows when they see a home. They may not know what they want, but they can feel what they want. When I'm showing a house that absolutely does not work, I dig into why it doesn't work. When we see other houses that may be a better fit, we discuss what does work for them and why."

The other two parts of the approach are negotiating a transaction and bringing that transaction to settlement.

"The most important function of a real-estate agent is negotiating a good deal on behalf of the buyer and educating the buyer about the market," says Brian Block, managing broker and branch vice president of the Block Real Estate Group with Re/Max Allegiance in McLean, Va.

Read:  5 things real-estate agents will do for free

"First-time buyers should rely on their Realtor to provide them with data about comparable homes that have sold, how long a home has been on the market, what homes haven't sold and all the activity that has been happening in the local real-estate market. Ultimately, it is the buyer's decision what price and terms they wish to offer. However, buyers should be able to rely on their Realtors to guide them toward an educated offer on the home."

Block points out that negotiation occurs not only at the beginning of a transaction over price and terms, but also possibly after a home inspection, an appraisal and at other times between contract and closing.

Fair-housing laws and real-estate agents
While real-estate agents can help buyers in myriad ways, there are some things they cannot do.

"Fair-housing laws prohibit discrimination," Block says. "Thus, an agent cannot steer a client to or away from particular neighborhoods based on their knowledge of an area's demographics. Further, agents cannot explicitly describe a neighborhood based on racial, religious, age or other demographic criteria. The agent can point buyers to websites and other reference sources where buyers can discover this information for themselves."

As Lesses says, "Our job is to talk about the house, not the people."

Working with other professionals
First-time homebuyers need to recognize that they must work with other professionals during the homebuying process, such as an attorney or title company representative to review legal documents, as well as a mortgage lender.

"Agents are not lawyers, home inspectors, mold experts, financial advisers or tax advisers," Block says. "While a real-estate agent can give some general background information in each of these areas, they cannot claim to be an expert and must suggest that the buyer retain the services of one of these other professionals should the need arise."

The biggest concern for most buyers today is whether a home will keep its value. An experienced real-estate agent can provide a buyer with the local market knowledge needed to make an informed decision about what to buy and how much to spend.

 

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REAL ESTATE: HUD Awards Millions to Native American Communities for Low Income Housing

Recently, the U.S. Department of Housing and Urban Development awarded more than $52 million in grants to tribal communities in 21 states to improve or create housing and economic development opportunities for low- to moderate-income families. The competitive grants are provided through HUD’s Indian Community Development Block Grant (ICDBG) Program to support a wide variety of community development and affordable housing activities.

“These funds will help American Indian and Alaska Native tribal governments create sustainable and community-driven solutions,” says HUD Secretary Shaun Donovan. “Housing and infrastructure needs in Indian Country are severe and widespread. I’m inspired by the work the tribal communities are taking on to leverage these funds and get their communities on the right track.”

For example, the Comanche Nation Housing Authority of Oklahoma will rehab more than two dozen houses for families currently living in substandard homes, including new roofs, doors, windows, insulation, electrical system and plumbing repairs, siding, flooring, cabinets and counters, and HVAC upgrades. In White Earth, New Mexico, a new 12,800-square-foot Workforce Development Center will provide workforce skills and vocational training to assist tribal members in obtaining employment.

In California, the Quechan Tribe will improve roads and sidewalks in a neighborhood with predominantly low and very-low income families with high amounts of foot traffic. In California, the Yurok Reservation will get multipurpose park and recreation facility. In Montana, families at the Mutual Help project in Northern Cheyenne will have their homes rehabbed to reduce the amount of substandard housing in the community.

The ICDBG program was established in 1977 to help Indian tribes and Alaska Native villages to meet their community development needs. Federally recognized Indian tribes, bands, groups or nations (including Alaska Indian, Aleuts and Eskimos,) or Alaska Native villages compete for this funding. The recipients use the funding to develop viable communities, including rehabilitating housing or building new housing or to buy land to support new housing construction.

The funding can also be used to build infrastructure such as roads, water and sewer facilities, and to create suitable living environments. To spur economic development, recipients have used the grants to establish a wide variety of commercial, industrial and agricultural projects. The grants have been used to build community and health centers, or to start businesses to support the community, such as shopping centers, manufacturing plants, restaurants or convenient stores/gas stations.

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REAL ESTATE NEWS #GREEN - HUD Announces $25 Million in Available Grants for New Multifamily Energy Efficiency Pilot

The U.S. Department of Housing and Urban Development recently announced that $25 million is available through HUD’s new Multifamily Energy Efficiency Pilot program. Once awarded, these grants will help develop new innovative approaches for multifamily residential properties to reduce their energy consumption, lower greenhouse gas emissions, while saving money for the residents, property owners and taxpayers.

“HUD is extremely excited about this pilot program because it aligns with the goals of the Administration to create green jobs and build sustainable communities,” says Acting Federal Housing Commissioner Carol Galante. “The innovations that flow from this pilot program will serve as models to create future industry standards in energy efficiency.

“Rather than tell applicants what we want to see, we are asking the private sector to develop new innovative approaches to create jobs and help people save energy and save money. Since these grants will be complemented by private capital, the investors will also have a unique opportunity to become leaders in helping make affordable multifamily homes greener,” says Theodore Toon, Associate Deputy Assistant Secretary for HUD’s Office of Affordable Housing Preservation.

The goal of the pilot program is to develop ideas and mechanisms that could potentially be replicated nationally, as well as help create industry standards in the home energy efficiency retrofit market. In addition, the pilot program will create a public/private partnership as a result of capital investments from private industries and create green jobs in construction, property management, and technical analysis (e.g. energy audits and building commissioning), including opportunities for low income residents.

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Governments’ Comprehensive Plans Essential Factor in #Real Estate Valuation

Real estate appraisers must consider the impact of local governments’ comprehensive plans when producing appraisals, according to an article published in The Appraisal Journal’s summer issue.

“This collection of articles from various authors with differing points of view presents all sides of this somewhat controversial topic and will help appraisers develop their own methods for addressing the separation of tangible and intangible assets in their professional work,” Appraisal Institute President Joseph C. Magdziarz, MAI, SRA, wrote in the book’s foreword, adding, “This new second edition will help bring appraisers up to date on this important issue.”

The Appraisal Journal is the quarterly technical and academic publication of the Appraisal Institute, the nation’s largest organization of real estate appraisers. The materials presented in the publication represent the opinions and views of the authors and not necessarily those of the Appraisal Institute.

“Use of the Local Comprehensive Plan in the Appraisal Process,” by Wayne Rasmussen, examines the important impact of a jurisdiction’s comprehensive plan on property’s current and potential value.

A comprehensive plan typically addresses land use, traffic routes, housing location and density, conservation and open space, noise, and safety. A plan also may establish urban limit lines that act as growth boundaries. The author notes that these governmental policies create both obstacles and incentives for development affecting the value of real estate.

The study reported in the Journal is significant because many times plan maps are used without a review of the accompanying text that sets out the intent and future plans of the governmental body creating the plan. The study advises that maps alone offer only a partial picture of a property’s potential. Background information, policy guidance and references in a plan have a significant impact and need to be understood before the appraiser reaches a conclusion of the highest and best use of the land and its value.

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REAL ESTATE: Pending Home Sales Slip in July but up Strongly from One Year Ago

Pending home sales declined in July but remain well above year-ago levels, according to the National Association of REALTOES®. All regions show monthly declines except for the West, which continues to show the highest level of sales contract activity.

The Pending Home Sales Index, a forward-looking indicator based on contract signings, slipped 1.3 percent to 89.7 in July from 90.9 in June but is 14.4 percent above the 78.4 index in July 2010. The data reflects contracts but not closings.

Lawrence Yun, NAR chief economist, says sales activity is underperforming. “The market can easily move into a healthy expansion if mortgage underwriting standards return to normalcy,” he says. “We also need to be mindful that not all sales contracts are leading to closed existing-home sales. Other market frictions need to be addressed, such as assuring that proper comparables are used in appraisal valuations, and streamlining the short sales process.”

The PHSI in the Northeast declined 2.0 percent to 67.5 in July but is 9.7 percent above July 2010. In the Midwest the index slipped 0.8 percent to 79.1 in July but is 18.8 percent above a year ago. Pending home sales in the South fell 4.8 percent to an index of 94.4 but are 9.5 percent higher than July 2010. In the West the index rose 3.6 percent to 110.8 in July and is 20.6 percent above a year ago.

“Looking at pending home sales over a longer span, contract activity over the past three months is fairly comparable to the first three months of the year, and well above the low seen in April,” Yun says. “The underlying factors for improving sales are developing, such as rising rents, record high affordability conditions and investors buying real estate as a future inflation hedge. It is now a question of lending standards and consumers having the necessary confidence to enter the market.”

The National Association of REALTORS®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.

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REAL ESTATE: REALTORS® Urge White House to Gather Leaders, Stabilize Housing

To help develop policies that will stabilize the nation’s housing market and support an economic recovery, the National Association of REALTORS® urges the White House to host a summit of policy makers, industry leaders and government stake holders focused on revitalizing the nation’s housing.

“As the leading advocate for housing issues, REALTORS® know that homeownership supports our nation’s economy,” says NAR President Ron Phipps. “Housing and homeownership issues affect all Americans, which is why we need strong policies that will help stabilize the housing market and lead the way out of today’s economic struggles.”

A housing recovery is key to America’s economic strength, and NAR wants to make sure that proposed legislation and regulatory rules or changes to current programs and incentives don’t further exacerbate problems within fragile real estate markets across the country.

A broad discussion among all stakeholders about what needs to be done to put the housing market and economy on a path to recovery could provide valuable recommendations and solutions to promote responsible, sustainable homeownership and stabilize and revitalize the housing industry and economy.

“REALTORS® look forward to coming together and working with President Obama and his administration as well as our industry partners to design a housing recovery plan that will serve our nation, its 75 million homeowners and indeed all Americans today and into the future,” says Phipps.

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Tips to Help Homeowners Prepare for Hurricane Irene

The high winds associated with hurricanes can cause significant property damage in the form of falling trees, tree limbs and flying landscape debris. The key to minimizing your risk against property damage is storm preparedness.

There is no such thing as a hurricane-resistant landscape but, with proper care and timely maintenance overseen by a certified arborist, trees can be more resistant to storm damage. The team of certified arborists at SavATree have compiled a few tips to aid in storm damage prevention.

Pruning is Vital to Prevention
A strong, deep-rooted tree may not fall during a storm, but weak limbs in the canopy may. Broken, dead and damaged limbs can be torn from trees during a storm and turned into dangerous projectiles.

Trees with dense canopies should be pruned regularly by a professional, especially during hurricane season. Proper pruning removes dead or drying branches which are most susceptible to wind.

Regular pruning during a tree’s development should create a sturdy, well-spaced framework of healthy branches with an open canopy that allows air to flow freely through it. It is important for a tree to have a central leader with no narrow forks or branches that leave the trunk at an acute angle. Limb crotches should be between 45 and 90 degrees.

Trees to Watch Out For
• Trees with dense canopies
• Dead or dying trees
• Trees with co-dominant trunks
• New plantings and young trees

Consult a certified arborist to see if these, or any other tree hazards, exist around your home.

After the Storm Has Passed
Assess your property for damage and threats. An arborist should be contacted if: you need a chainsaw or ladder to prune away dead, dying or loose branches, power lines are down, you are unsure of the structural stability of a tree, or you do not know if a tree can be saved. In some cases, even a tree that has sustained some damage (defoliated, broken, or blown over) can be treated.

Trees have a much better chance of surviving if they receive proper, routine care. Remember, healthy trees can adjust more quickly to changes in the environment and are more resistant. Therefore, if you are proactive and take the necessary steps before a storm hits, you can reduce your risk of property damage—saving yourself a great hassle and expense.

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