The Closer the Broker, the Quicker the Close
Homes Closer To Brokers’ Offices Sell Faster – WSJ
Buyers should check the credentials of the home inspector they’re hiring, especially if the inspector comes recommended by their real estate agent. If a home purchase deal falls apart because of problems found in a home inspection, the agent won’t sell the house and earn a commission, says Bennie Waller, a professor of finance and real estate at Longwood University in Farmville, Virginia.
by: Geoff Williams
Should You Sell Your House or Renovate It? – US News
The math may sway you. Sell or renovate? If you’re leaning toward selling, but are toying with making upgrades to increase the sticker price, know this: A major renovation won’t always spell a big payoff.
So they decided to buy a new house – and keep the old one so they could rent it out for another income stream.
“I examined the decision purely from an investment perspective,” he says.
DAILY REAL ESTATE NEWS | THURSDAY, OCTOBER 16, 2014
Residential substance abuse treatment centers can impact the price of neighboring homes, according to a study that uses MLS data to show just how much it can potentially hamper nearby values.
Centers for treating substance abuse are increasingly being located within residential neighborhoods, and the number is expected to grow. Many property owners respond with a “not in my backyard” attitude when a center is proposed, with nearby residents arguing that recovering addicts could bring higher crime risk to their community.
Researchers Claire Reeves La Roche, Bennie D. Waller, and Scott A. Wentland at Longwood University in Farmville, Va., used MLS data from central Virginia to estimate the impact of substance abuse treatment centers on nearby home values. They also used the data to figure out whether homes near substance abuse treatment centers stayed on the market for a longer amount of time.
They found that home values within one-eighth mile of a residential treatment center is associated with an 8 percent reduction in home prices when measured against comparable homes that are farther away. The discount is magnified even more when the treatment centers are for those that specifically treat opiate addiction, which includes addictions to heroin or morphine. In those cases, home values are reduced by up to 17 percent, researchers found.
“Generally speaking, you should not use a credit card for expenses like paying taxes,” says Bennie Waller, a professor of finance and real estate at Longwood University. “However, there may be situations in which it makes financial sense.”
Waller suggests that using a credit card can be reasonable in a pinch. “If there is a 10% penalty for not paying your property taxes by a certain date, but you can use a credit card and will be able to pay off the credit card within a couple of months, it probably makes sense,” he says.
Being able to quickly resolve the problem, as long as you can repay the debt quickly, is the key. “This assumes that you will not allow these charges to be carried on the card for longer than two or three months,” Waller says.
By Sarita Harbour
July 16, 2014 9:23 PM
Looking to reduce your monthly mortgage payments? Depending on your situation, refinancing could still be your best option for achieving this goal.
“Refinancing is a great way to lower your mortgage payment,” says Bennie Waller, professor of finance and real estate at Longwood University in Farmville, Virginia.
And while rates are higher today than they were a couple years ago, for some homeowners, today’s rates are still low enough for refinancing to make sense.
Still, lending standards aren’t going away. And they’ll couple with rising interest rates, which discourage some first-time homebuyers, says Bennie Waller, professor of finance and real estate at Longwood University in Farmville, Virginia.
“Compounding the difficulties for buyers is the rapidly increasing student loan and credit debt debacle that looms over the economy,” Waller says. “This will severely limit the purchasing ability for first-time home buyers and low to mid-income homebuyers.”
2014 marked the best year in economic recovery since the recession, according to the Bureau of Labor Statistics. This means that there may be more opportunities for home ownership in 2015. The economic improvement indicates that the housing market is expected to see gradual growth in home prices and inventory, however increasing mortgage rates and strict lending standards may still put home ownership on hold for some. Real estate experts share their 2015 housing market predictions below, and offer insight on the current market, where it’s headed, and how it will impact buyers and sellers in the coming year.
Despite a steadily growing economy, mortgage qualifications aren’t expected to relax in the upcoming year. While interest rates hovered around 4% in 2014, chief economists at Freddie Mac anticipate rates to surpass 5% by the end of 2015 due to the rebounding economy. Millennials, aged 18 to 24, may struggle to qualify for traditional financing due to lack of established credit and down payment resources.
Bennie Waller, professor of finance and real estate at Longwood University, adds, “Compounding the difficulties for buyers is the rapidly increasing student loan and credit debt debacle that looms over the economy. This will severely limit the purchasing ability for first-time homebuyers and low to mid-income homebuyers.”
by; Bennie D. Waller, PhD
Homeowner inspections are incredibly important, however most states have very limited requirements as to what qualifies as a home inspector.
In Virginia, there are NO requirements. If you put forth yourself as a home inspector, then you are. This is incredibly problematic if you are involved in a dual agency.
If you are looking to buy a home in Virginia, please contact or visit the DPOR website for a list of licensed (competent) home inspectors.
by Ray Akers, columnist
Buying a home through the listing agent sets up a dual-agency situation. A dual-agency can occur with two agents when both are working for the same real estate brokerage. A dual-agency can also occur when a single agent represents the seller and the buyer, as in the scenario you suggest.
A potential buyer who isn’t working with a buyer’s agent may request the seller’s agent to prepare and submit a purchase offer on their behalf. The agent will act as a dual agent. For obvious reasons, this creates a conflict of interest.
Dual-agency requires the agent to treat both the buyer and the seller honestly and fairly. The dual agent must divide his or her loyalties between two parties with divergent interests — sort of like a divorce attorney representing both husband and wife in a divorce.
Some agents will tell you dual-agency is more efficient and effective. Having just one agent as point-of-contact can expedite a sale. Obviously, the real estate dual-agent has a lot to gain from the transaction: The seller typically pays 5 to 6 percent of the sale price as commission, which is split between the listing broker and selling broker. Clearly, some agents will be motivated to represent both sides of the transaction and earn the entire commission.
In a dual-agency scenario, there is a concern the agent might encourage the seller to accept a lower price for a home to get the double commission. From the buyer’s perspective, a dual-agent is not allowed to reveal the seller’s “bottom-line” price, so you will never know if you got the best price. The dual agent is placed in a precarious position, attempting to balance the interests of the buyer, the seller and their own interest in a transaction. It’s unlikely the interests of all three parties will converge. Frankly, it’s probably impossible.
What studies show
Many states allow dual-agency relationships, in which the agent represents and has a fiduciary duty to both the buyer and seller. Washington state allows dual-agency.
From “The Law Of Real Estate Agency” pamphlet, “Duties of a Dual Agent: Notwithstanding any other provision of this chapter, a licensee may act as a dual agent only with the written consent of both parties to the transaction.”
Licensees are expressly advised “to take no action that is adverse or detrimental to either party’s interest in a transaction” and “not to disclose any confidential information from or about either party, except under subpoena or court order, even after the termination of the agency relationship.”
Dual agency can increase or reduce a home’s sale price, depending on the timing, says Bennie Waller, professor of finance and real estate at Longwood University in Virginia, who studied dual-agency in home sales.
Researchers analyzed sales in which one agent represented both buyer and seller. According to the Journal of Real Estate Research (June 2013), the study found:
•Dual-agency sales in the first 30 days of a listing were 18 percent higher, benefiting the seller.
•Dual-agency sales in the last 30-days of a listing were 6 percent lower, benefiting the buyer.
•Overall, dual-agency reduces a home’s sale price by 1.7 percent.
•Dual-agency sales are 55.1-percent quicker than non-dual-agency sales.
•About 32 percent of all transactions are dual-agency transactions.
In our tight housing market, with buyers facing bidding-wars, some buyers are incentivizing agents by offering them the opportunity to represent them as well as the seller. Buyers presume that this will motivate the agent to promote their offer. However, there is recent data that shows a buyer pays about $5,000 extra when buying a home with a dual-agent.
While a dual-agency arrangement may appear to give a buyer the edge in some circumstances, I advise a homebuyer to avoid dual-agency if at all possible. Dual-agency jeopardizes the rights of the buyer and the seller, and few agents are skilled enough to manage a dual-agency transaction without favoring one party over another.
My advice: Don’t try to become a real estate expert; hire one instead. Ask friends and family members for a referral to an agent with whom they’ve had a good experience. Having a skilled agent working for you will result in a better outcome.