March 29, 2010

Common Causes of a Short Sale

Posted to Short Sales / Foreclosures, Steve Randall

Here in Northern Utah, most of the homeowners are not directly feeling the impact of the downturn in housing values unless there is a need to sell their home now. Indirectly, however, every homeowner is impacted when there is a short sale or foreclosure in the neighborhood as these homes tend to sell for less than the normal market values. As a result, surrounding home values are indirectly impacted as these homes become comparables used by appraisers to establish new home values.

One of the reasons the administration is trying to curb the effects of delinquencies and foreclosures is to stop the downturn of home values. As the values continue to drop, there are more homeowners who become at risk of a short sale. Unless the trend is curbed, equity in homes will continue to be lost. Last week, a new effort was made to assist more homeowners with mortgage modifications.

Most of us think that we will never be in a short sale or foreclosure situation but most of the major reasons for homeowners can happen to even the most unsuspecting owner. For example, here is a list of common reasons that would qualify a homeowner for a short sale:

  1. Job loss
  2. Business failure
  3. Payment increase or a mortgage adjustment
  4. Divorce or death of a spouse
  5. Illness
  6. Relocation
  7. Reduced income
  8. Mortgage fraud
  9. Predatory lending practices

As you can see, many of these common causes for short sales and foreclosures can and do happen to many of us and when they happen to our friends and neighbors it can have an indirect impact on us as well. For more information on short sales/foreclosures please contact our office.

Posted By: Steve Randall


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March 19, 2010

Calculating and Analyzing Absorption Rate

Posted to Brad Sears, Buyers, Sellers

Have you ever wondered how fast homes are selling in your neighborhood right now? There is a way to measure it that will tell you which way the market is heading. Absorption rate is the measurement of the rate of sales in any neighborhood. For example, if 50 homes are sold in a month’s period, and there are 100 homes for sale in the market place, the absorption rate is 2; meaning that there are two months of inventory currently in the marketplace.

A balanced market of buyers and sellers is defined at 5-6 months of inventory. A “2” absorption rate means that the sellers have the advantage. A “9” means that the market favors the buyers and sellers can expect to discount their property values in order to sell their home. Included is a chart that show how the absorption rate can also indicate if the market is appreciating or depreciating.

For specific information on your neighborhood please contact me for a free absorption report.

Posted By: Brad Sears


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March 19, 2010

Considering Other Options Than Foreclosure

Posted to Short Sales / Foreclosures, Steve Randall

In this post we deal with options other than foreclosure that a homeowner may consider. Some of the options involve a Realtor and other options do not.

Homeowners Have Choices:

  1. Refinance: Homeowners work with lenders in the new HAFA program to reduce monthly payments amounts. No Realtor involvement is necessary.
  2. Lender Workout: Lenders at time will work with homeowners to restructure the loan and forgive missed payments or add them to the end of the loan. Fees can be wrapped into the new loan and interest rates lowered. No Realtor involvement is necessary
  3. Sell and bring cash to closing: If the homeowner has other resources, lenders will expect sellers to liquidate assets and bring money to closing to pay off the difference in the mortgage amount and the sale price of the home.
  4. Short Sale: In a short sale the lender agrees to accept less than full payment and to at least partially satisfy the amount owed to the lender. Short sales won’t damage the homeowners credit as much, have less impact of the neighborhood home values, and are a more civil way for lenders to release homeowner’s from their obligations.
  5. Deed in lieu of foreclosure: this occurs when the borrower agrees to trade the property to the lender and the lender agrees to cancel the note. In declining markets, lenders are less likely to accept this alternative. No Realtor involvement is necessary.
  6. Do nothing or walk away: At times a homeowner may simply be upset that the value of the property has dropped or that the other options available are too difficult so they just decide to walk away. Homeowners should always check with their attorney and account about this option because the consequences can be far more substantial than for homeowners than those who attempt to complete other alternatives. No Realtor would recommend this alternative but a Realtor is not needed in this option.

There certainly may be other options not mentioned above and there are many variations to the options above. The Federal Government’s current recommended choice is a short sale or deed in lieu of foreclosure and new guidelines have been established to move these processes through more quickly.

Please contact me for further information on foreclosure alternatives.

Posted By: Steve Randall


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March 18, 2010

Working towards a short sale instead of foreclosure

Posted to Short Sales / Foreclosures, Steve Randall

In this post we talk of a real life short sale in progress in Fruit Heights, Utah. The Sellers were transferred to another State just as the real estate market was beginning its decline in Northern Utah. When unable to sell the home for more than the mortgagee value, their Realtor called us and asked for assistance renting the property. A qualified renter was found but then the Sellers had a pay reduction which meant their cash flow turned negative and it became necessary to sell. After receiving several offers and no response from both the first and second lien holder, the collections calls from the second lien holder began to increase… as well as the pressure. Without any further resources to rely on, payments got further behind and the collection calls increased. Frustration set in and the thought process was just to walk away from the property and declare bankruptcy and put this whole mess behind them.

What sellers need to understand is that foreclosure and bankruptcy are the two options that are least beneficial to them. We normally continue to work to complete a short sale until the actual foreclosure takes place. There is no harm in giving lenders one last try at a short sale because they really don’t want to take the home back into their inventory either. Short sales are less costly to lenders than foreclosures. We would encourage Sellers to hang in there until it actually forecloses before walking away.

The administration instigated a new HAMP (Home Affordability Modification Program). There is now a greater chance that lenders will cooperate. Click here for a recent article in the Utah Realtor Magazine explaining the new procedures and timelines.

Here are the advantages of a short sale over foreclosure or bankruptcy:

Short sales will impact credit less; statistics show if the Seller is current on other bills, credit may be negatively impacted 50 -70 points. This impact will be for a 2-3 year period. Completed Short Sales are reported on credit reports as:

  1. Paid in full – Paid as agreed
  2. Paid – Settled
  3. Paid – Unrated
  4. Paid – Less than owed

Foreclosure and Bankruptcy will impact a seller’s score over 200 points and stay with the seller for seven years …and may remain even longer on a credit record. It means difficulty in making any further time purchases for furniture, cars, and homes. It raises the interest rate when you do find those who will lend to you. The impact is longer lasting.

In the new short sale model, lenders are given incentives to offer a short sale solution over foreclosure/bankruptcy; $3,000 is given to subordinate liens like CitiBank. Lenders are now being paid (incentivized) to do a short sale rather than a foreclosure.

Here is more information on the HAFA program to help short sale sellers; plus a real life story from a person who actually went through a short sale.

For more information on short sales please contact me as soon as you become delinquent.

Posted By: Steve Randall


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March 16, 2010

Short Sales and Foreclosures --- A Trend or Tidal Wave

Posted to Buyers, Sellers, Short Sales / Foreclosures, Steve Randall

Short sales are not new to real estate practitioners but the number of foreclosures and short sales on the Northern Utah market currently is higher than we have experienced in many years. The economic conditions have resulted in job loss and pay reduction for many causing a rise in delinquencies and stress on homeowners. In 2009, nationally, there were 1.9 million properties where foreclosure actions were started. This year the number is anticipated to increase. We certainly are seeing our share of short sale and foreclosures in Utah.

What is a foreclosure? Some may think of a foreclosure as a greedy lender taking over an owner’s home. Others may think of abandoned properties that cause a loss of value to the neighborhood and community. Still others may see this as a way for buyer’s to pick up properties on the courthouse steps for pennies on the dollar.

A simple definition of a foreclosure is a legal process whereby the borrower is deprived of their ownership interest in a property because of nonpayment.

The reality of the situation is that lenders really do not want these properties back on their books and with some exceptions, most buyers pay close to market price for homes that are in good condition. Short sales, by definition mean that the borrower owes more on the home than the home is currently worth in the marketplace. As property values decline, more and more northern Utah homeowners are facing this possibility.

Many borrowers work with their lenders to negotiate a short sale rather than letting the property go into foreclosure. A short sale allows the borrower a way out of the mortgage with less impact on the borrower’s credit and allows the borrower to re-enter the marketplace in 2-3 years.

A foreclosure will be on the borrower’s record for at least seven years and can have a negative impact on the borrower’s credit of 200 points or more. As of April 5, 2010, the Federal Government is encouraging lenders to pursue the short sale remedy first before taking the foreclosure option.

There are many websites that give information on how to proceed with a short sales or foreclosure. For information on foreclosures in Utah click here.

For more information or assistance with a short sale or foreclosure action please contact me at your earliest convenience.

Posted By: Steve Randall


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January 21, 2010

You Can’t Change Me! Using PDFs in Business

Posted to Adam Stuart

While the title to this post might be a little misleading as to what I’m talking about it actually makes quite a bit of sense. For the past few years as I’ve been working in Property Management and Real Estate transactions I’ve become very acquainted with the popular PDF file. PDF stands for Portable Document Format. PDF’s are great because they are not easily manipulated, they are relatively small (making them great to send as attachments in emails), and almost everyone that owns a computer has some type of PDF reader. The fact that the document can’t be altered is one of the biggest reasons we love them… hence “you can’t change me!”

There are expensive programs that you can purchase that allow the user to do all sorts of crazy things with a PDF file. I’ve seen programs that allow you to highlight, put in captions, bookmarks, comments, change the colors, create hyperlinks, etc. While these perks are interesting I don’t have a need to use them often. That said, I can’t justify spending several hundred dollars just so I can highlight a section of a PDF.

Awhile back I did some quick searching for a cheaper way to create a PDF from a word processing document. Cnet’s www.download.com has become a place for me to search for the latest and greatest, free or cheap software. While looking around I stumbled across a program called PDF reDirect. EXP Systems LLC created both a free and professional version of PDF reDirect. I have had the free version installed on my laptop for about a year and use it almost daily. The free version allows the user to create a PDF from just about any type of file. I have had success in creating PDF’s from Microsoft Word, Microsoft Excel, Microsoft Publisher, Google Docs, WebPages, images, screenshots, etc. I love this program. The professional version costs only $19.99. It adds quite a bit of functionality to the free version. On EXP System’s website they have a comparison chart where all the differences between the free and paid version are listed. You can see that chart by clicking here.

As a Realtor® I often need to send offers, rental applications, lease agreements, etc. that have all kinds of sensitive information within the document. As we know not all email is secure. One of the best features that PDF reDirect offers is a way to encrypt (password protect) sensitive documents. I am now confident as I send emails because the recipient and I have established a password that must be entered before the file can be displayed.

To download the free versions of this program please click here. If you know of any other programs that might be helpful please let me know. If you have problems installing or using PDF reDirect I’d be happy to help. I can be reached at adam@welchrandall.com or on my cell (801)388-3035.

Posted By: Adam Stuart


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January 05, 2010

Reasons Why Now Is the Time to Buy

Posted to Brad Sears, Buyers

We keep hearing that now is the time to buy because of “low interest rates,” “low house prices,” “tax credits” and on and on. But, you may ask, “What does that mean to me?” The most practical way to look at it is, “How will all of this affect my family’s budget?” because after all, that is ultimately what makes a difference to us on a month to month basis.

Let’s say that you have given yourself $1200 a month to go towards housing. Most people have a pretty good idea of what quality, size and location of home they can expect for $1200.

First, let’s consider the impact of Low Interest Rates:
It has been said that when the economy is balanced and where it ought to be, rates should be between about 7 and 8%. Right now rates are at 4.875%. It also has been said (by virtually every economist out there) that rates are expected to rise significantly once the Federal Government ceases buying mortgage backed securities which is currently powering the market towards lower rates. At 4.875%, your $1200 per month would buy you a home worth about $180,000. However, when rates go to about 7.5%, $1200 will only buy a home worth about $140,000. Pretty big difference.

Next, let’s consider the impact of Low House Prices:
Home values have gone down. A home that is worth $180,000 today was worth, on average about $210,000 during the peak in 2007. Home values will go back up. They always do, especially here in Utah where the economy is more stable than many other areas in the United States. According to information gathered from the Historical Mortgage Rate Data page from www.mortgage-x.com, and illustrated in the chart below, we see that in 2007, $1200 per month would have purchased a home worth $156,000.

If you compare your purchase of a home now for $1200 a month to someone who purchased a home back in 2007 for $1200 per month, you would have $54,000 more of a home while you are BOTH paying the same $1200 a month! ($210,000 value compared to $156,000)

Third, let’s consider the Tax Credit:
The Federal Government is offering tax credits worth $8,000 for First Time Home Buyers and $6500 for Repeat Homebuyers (certain restrictions apply) for the purchase of a home. This money could be immediately used to make a principal payment on your mortgage loan knocking off possibly years of payments. You could set it aside for a rainy day fund for all the many expenses that can come from owning a home. You can literally do anything you want with it. This definitely sweetens the deal when considering purchasing a home now.

And as if all of that was not reason enough, did you know that FHA loans are assumable? This means that if you lock in a 4.875% rate and later decide to sell your home, your buyer can assume your loan and keep your 4.875% rate so long as they qualify for an FHA loan! If you are selling the home for more than you owe, the buyer would simply need to pay you the difference separately which they can do many different ways. When you go to sell, imagine being able to offer a rate around 2.5% less than what they can get through any lender!! What a selling point!!

For more information about buying now and to view all the listed homes for sale in Utah, please visit my website at www.TheSearsTeam.com.

Posted By: Brad Sears


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January 05, 2010

Millstone Manor

Posted to Buyers, Justin Stevenson, Sellers

In the 84404 area there is a condo subdivision that is one of the greatest places to live in this area. This subdivision is called the Millstone Manor. The Millstone Manor was built in 1986 but looks and feels a lot newer than that. The location of the Millstone Manor is one that covers it all. With the condo location right at the month of the canyon is makes it easy to zip up the canyon to go skiing or snowboarding at the local ski resorts such as Wolf Mountain and Powder Mountain, also during the summer it allows you to fish and ski on the Pineview Reservoir. On the other hand the Millstone Manor is located close to I-15 as well as downtown historical 25th St. At the Millstone Manor during the summer you may see a lot of happy people because there is a pool located in the middle of the subdivision that helps keep the residents cool on those hot summer days. One other benefit we can’t ignore is the property backs right up to the Ogden River which makes Millstone Manor residents feel as if they are at one with the nature.

In the Millstone Manor subdivision there are currently six properties that are on the market for sale. Of these six there are many shapes and sizes. One property that I would like to tell you a little more about is unit number ten in building one. This property is a two bedroom one bathroom condo that has the best view of the river in the whole complex. This property is currently listed below the rest that are for sale. Unit number ten is listed at $72,000 and would make any family happy.

If you are currently looking for a property in the Ogden area then Millstone Manor is the place for you. If you would like more information about unit #10 that is listed for $72,000 please call or email at 801-710-8081 or justin@welchrandall.com.

Posted By: Justin Stevenson


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January 04, 2010

The Next 10 Years!

Posted to Neighborhood Market Trends, Steve Randall

Welcome to a new year! We survived the 2009 real estate market! In fact, we actually had some good news in last half of 2009 with unit sales rising in many parts of the country and some price ranges actually seeing some appreciation. In some areas in Layton and other parts of Northern Utah we saw some appreciation. We don’t want to be overly optimistic because we know that recovery will be slow and some economists fear a “double-dip” economic recession if unemployment numbers don’t show greater improvement. There will be some rough waters to navigate this year as well.

In 2010 we still face a higher than normal inventory, declining home values in most price ranges, high unemployment leading to delinquencies, short sales, and even foreclosures. Credit is still tight but the worst is likely behind us. Recovery will be slower than we all wish for, but still we will see progress in 2010 in the Utah housing market.

A recent Deseret News article outlines some of the changes coming to Utah in the next decade that will impact our lives in the next 10 years. Here are the full details of the article.

Utah, especially Northern Utah, will have some great things to look forward to starting with an estimated increase of 700,000 new residents in the next 10 years. The bulk of that population growth will be centered in Northern Utah. Additionally, Utah will draw some high tech jobs and companies as part of its “entrepreneurial heritage.” Research now being conducted at Utah’s major Universities will continue to draw top notch companies which will want to employ Utah’s highly educated work force.

Transportation will be expanded with new smart-car technology that will communicate with each other adding new features and greater safety. Utah Transit Authority (UTA) will have five new Trax lines completed by 2015. Real estate values will increase around the station locations. In addition, the Mountain View Corridor will be completed to Provo and I-15 expanded to accommodate the new growth coming to Utah. Each expansion of transportation will lead to more growth and an increased demand for new housing, existing housing and a strong rental market through the next ten years.

Utah’s economic growth will outpace the US economy in the next 10 years with the real question being how well will the US economy do in the next 10 years. Utah’s advantage has always been in its educated, reasonably priced work force. That advantage is expected to continue into the next decade.

To review the top 10 stories for national real estate trends in 2009, we refer you to Steve Harney’s blog which we have highlighted in a previous blog post. For the statistics on how we in the Beehive State did in 2009, please refer to this NAR report for Utah.

One thing we know for sure is that there is nothing to fear in 2010 that a buyer, seller, or investor with the right information cannot use to their advantage. For those in Northern Utah who want to know how the recent market changes have impacted home values, please contact us for a free, no obligation, Competitive Market Analysis. Welcome 2010!

Posted By: Steve Randall


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December 31, 2009

The Close of the Year Brings the Close of a Transaction

Posted to Ogden, Steve Randall

Yesterday I attended what most people call “a closing.” In this case the client was the family Trustee for a home where the parent had passed on, leaving the property vacant. The home that sold was located in the Day Break Complex in South Ogden. During the time we were at the “closing” the escrow officer asked if this would be my last “closing” for the year. I pondered for a few seconds realizing that this year was almost over and that I would be starting over with more closings… but all would be into 2010.

The client and I began to talk about “closings” in general and I thought it would be good to review the differences between “closing” and “settlement” because it can be important to know the differences.

Yesterday, we were actually at “settlement” even though most people (including most agents) call it a “closing.” Settlement is where the parties involved in the transaction meet with a title escrow officer who reviews the paperwork including lending documents and the HUD-1 Statement to be sure all is in order. The Buyer and Seller meet with their respective real estate agents in a comfortable conference room… normally at different times and often with different title companies. Once the documents are all signed and there is total agreement, the property is then recorded by the County assessor and the money is sent to the parties as outlined in the Settlement process which took place earlier.

The recording process and the distribution of money is called “closing” in Utah. In this case both processes took place on the same day but in most cases there can be a 24 to 48 hours difference in time between settlement and closing.

Once the house is “closed,” the buyer becomes the new owner of the property and can begin to move in. The transaction is for all general purposes considered to be complete.

Closing is the ultimate goal for the seller and the buyer as the seller gets the money for the property and the buyer is anxious to receive title to the new home.

As we close this year we wish everyone a happy and prosperous New Year with many successful “settlements” and “closings.”

Posted By: Steve Randall


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December 30, 2009

The Absorption Rate of Homes and Pies!

Posted to Ogden, Steve Randall

Each week we pick up five or six pies made by our Layton Marie Calendar’s Restaurant to serve to our clients when they visit our office. So if you are ever hungry just stop by the office and ask for a piece of pie! It is our way of saying thanks to our valued customer base. The interesting thing about pies is the rate at which they sell is dependent on the time of year and the specific holiday. Shortly after Thanksgiving I asked our local manager, Diane, how many pies she sold over the three-day Thanksgiving weekend? I knew they were busy and I was thinking that they might have sold 500 pies or more! I cajoled Diane let me know her count and was shocked to learn that she lead the restaurant chain with 9,645 pies sold in that three day period! On a subsequent visit after the Christmas Holiday, Diane reported that they had sold over a 1,000 pies which was good for this particular holiday but nothing like Thanksgiving. I learned that selling pies, like selling real estate, is dependent on the time of year and the particular holiday. Thanksgiving is the holiday that leads the way as the best time to sell pies.

In real estate we also measure the rate of sales just like Diane did with her holiday pies. The rate of sales is called the “Absorption Rate” and before we give any of our sellers or buyers information on the best time to list a home or to buy a home we always look at the absorption rate for their particular neighborhood. The newly updated MLS system allows each of our agents to quickly calculate the rate of homes for sale in any area and also gives the rate of sale by the price range homes are listed.

In a balanced market the rate of sales ratio is between five and six months of inventory. A lower ratio number means that inventory is scarce and the market favors the Seller. When the number is above six then inventory is more plentiful and it becomes a Buyer’s market forcing Sellers to compete on price, home condition, and the payment of some or all of the closing costs. Knowing the absorption rate is critical information for any Buyer or Seller to know. The Absorption rate is also an indication of whether prices are appreciating or depreciating… and the rate of that change.

The actual absorption rate is calculated as follows according to the MLS definition:

Absorption Rate is the ratio of the number of listed properties (Actives) to the number of sold properties over a given length of time. Absorption Rate is an indication of Inventory or Supply.

Total No. of Current Actives X No. of months back
————————————————————————— = Absorption Rate
No. of U. C.’s + No. of Sold’s

In a closing today in South Ogden, the absorption rate for this price home was 11.68 for the past 30 day period. That means this area was a strong Buyer’s market. The Seller’s property was priced for the current market and sold before year end while three other properties in the area remain on the market with no offers. In this case the Seller paid closing costs and the property was maintained in good condition so that it stood out against other homes currently for sale. Just like pies move faster at Thanksgiving, homes in the summer months move faster as well. Add the additional incentive of the tax credit and home sales really increased up to the end of October. The Absorption rate for the summer was in the eight range versus an eleven range after Thanksgiving.

While a lot of people normally pull their homes off the market in the winter in Northern Utah, the tax credit may be just the incentive this winter season to keep the home on the market so that buyers will have more inventory to choose from.

If you would like more detail on appreciation rates for your area or the absorption rate for your neighborhood in order to make a decision to buy or sell, please contact our office.

Posted By: Steve Randall


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November 25, 2009

Time to Give Thanks

Posted to Justin Stevenson

Every year during the week of Thanksgiving I always sit and think of all the things I am thankful for in my life. I am grateful for many things like family, friends, sports, and a wonderful job. One thing I am always thankful for is the opportunity of owning my home. My wife and I have owned our condo for the past two and a half years and it has been great. The feeling you get when you buy a home is something that is hard to explain but it is a feeling of satisfaction. Knowing that you are paying for your home versus paying for someone else’s home when you rent is such a great feeling.

Many people may feel that now is not the time to buy, but they are wrong. Now is the best time to buy. With interest rates as low as 5-6%, the first-time home buyer tax credit of $8,000 extended until April 30, 2010 and now the new tax credit for people who have lived in their property for at least 5 years can now receive a tax credit of $6,500 when they buy new property. If free money is not an incentive for you to buy a home I don’t know what is! For those who don’t qualify for the tax credit you can still take advantage of the low interest rates. Either the tax credit or low interest rates or both…now is the time to buy.

For more information about the tax credit and how it works and who qualifies for the tax credit please contact me by email at justin@welchrandall.com.

Posted By: Justin Stevenson


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November 17, 2009

For Rent!

Posted to Justin Stevenson, Ogden, Residents (Renters)

Renting a property may sound easy to some people but to others it is one of the hardest things they ever have to do. Also many people are scared to rent out their home because of all the horror stories that are out there. I am not saying that horror stories don’t exist in renting out your home, but if the property is managed right many of the headaches that owners of rental properties normally have can be handled. In the current real estate conditions, many people are turning to property management companies to help them with their investment. The key to successful property management is a good system for every procedure along with a good support team. Many times investors who have rental properties lack the ability to enforce the contract that the tenants sign. As a Property Manager there is a fine line between a friendly relationship and business relationship and it is very important to always have control of the business aspect in the rental property.

One important step when it comes to renting out a property is making sure that the prospective residents are qualified for the property. As a member of the Good Landlord program here in Ogden city, one of the requirements for a landlord is to run a background on every client that would like to rent the property that is over the age of 18. The screening process can really make or break the future of that rental property. There are a few things that we check to make sure that we are renting to good qualified residents. The first thing we check is their credit to make sure there are not any outstanding collections or bankruptcies. The next thing we look for is to make sure that the client does not have any criminal background. One other thing we check is their rental references from a past landlord. Finally, one of the last things we check is the client’s income and their current place of employment. Now, each property management company and landlord has different expectations or qualifications for the clients that would like to rent their properties. It is just a matter of setting the standard and sticking to that standard for every client.

I enjoy being in the business of property management and I love helping people with their investment properties. I take pride in the skills and training I have developed over the years that I have been doing this and I am grateful for the experiences I have had. If any of you have any questions about property management please contact me by email at justin@welchrandall.com.

Posted By: Justin Stevenson


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November 09, 2009

Location, Location, Location

Posted to Justin Stevenson

When it comes to real estate one of the most important things you look for is a good location. As I sit down and talk with clients they are always looking for the best location for their families. I have not always lived in this great state of Utah but I am starting to enjoy what Utah has to offer. I grew up in the busy state of California where I would have to travel long distances to get to the great outdoors, but here in Utah it’s right in your backyard. Being in Real Estate we have the opportunity to travel from city to city and see what each city has to offer. Each city has something a little different than the other, if it is farm land, mountain trails, ski resorts, city life, or a subdivision it is all great here in Utah.

One of the best opportunities we have to check out other locations and properties is on a day we call Halloween. Going from house to house and from one neighborhood to the next you have the chance to see what is out there. Even though candy is involved I always like to evaluate a home and see what styles I like and dislike so when it comes time for me to look for a new house for my family I know what I am looking for. It does not matter if you are not in a position to make that next step and move into your dream home yet - it doesn’t hurt to start looking. As the famous Boy Scouts’ motto goes “always be prepared,” so it is always good to prepare for the future.

Utah is a wonderful place and has great locations where you can find happiness in raising a family. I always thought growing up that I would never move out of California and leave the beach but now that I see what Utah has to offer, I am proud to say Utah is a beautiful place to live.

Posted By: Justin Stevenson


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November 03, 2009

Home Prices Again Show Appreciation in South Ogden and Riverdale!

Posted to Ogden, Steve Randall

While most of us prepare to head to the polls to vote today, there is some good news for residents living in South Ogden, Riverdale, and some Ogden areas. Single family homes in zip codes 84405 and 84403 show home prices appreciating at 3.3% and 3.8% respectively. South Ogden has shown appreciation in each quarter this year while the Riverdale areas appreciation rate started in the second quarter of this year.

In other areas of Weber County, prices this year have declined from 1.9% in North Ogden to as much as 23.4% in the Marriott/Slaterville area. There are still negative pressures for South Ogden and Riverdale due to unemployment concerns and an economic recovery for the private sector but these areas at least may be showing price appreciation and may have reached their low point in value last year.

To track home values since 2003 for any Zip code in Northern Utah just click here. This is a great day to exercise our rights as citizens to choose our elected officials. Enjoy that right by voting and go to the polls knowing that recovery has started in some areas of Northern Utah. For market information about your specific neighborhood or your home please send me an e-mail.

Posted By: Steve Randall


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November 03, 2009

First Time Home Buyers Now Enjoying Incentives! What is the future of Interest Rates?

Posted to First Time Home Buyers, Steve Randall

This week we have two clients that are closing on their homes in Layton and Syracuse. These first time home buyers will be enjoying the benefits of low interest rates and the $8,000 tax credit. During the last two weeks they have been able to lock their loan rates in the low 5% range and obtain seller concessions to cover most of their closing costs. The absorption rate, which measures the rate at which homes are selling, have temporarily changed from a Buyer’s market to a Seller’s market in some cities in Davis County. This is a result of buyer pressure to use the tax incentives and low interest rates before the tax credit is set to expire at the end of this month. Interest rates have returned to their lows of earlier this year.

In today’s Wall Street Journal, the future of interest rates are discussed with the general consensus that interest rates will increase in the future, reducing the affordability of new homes. In general, lower interest rates caused by the government’s backing of security based bonds will not last forever. There will be a raising of the interest rates in the months ahead even thought it will be slow and gradual. In the past, low interest rates have been followed by steeper increases in rates. High unemployment numbers and a very fragile economy will keep the Federal Reserve conservative in these increases.

The point is this, first time home buyers should not delay their purchases but should take advantage of the $8,000 tax credit, which is likely to be extended into 2010, and low interest rates while they last. Homes have never been more affordable than right now and waiting will only add to the risks on increased mortgage costs. For more information on how fast homes are selling in you specific neighborhood, please contact me directly.

Posted By: Steve Randall


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October 28, 2009

Fernwood Hollow Subdivision

Posted to Brad Sears, Neighborhood Market Trends, Ogden, Salt Lake City

Over the years many homeowners have taken their search for homes north of Salt Lake City for the simple idea of getting more home for their money, a chance to escape the fast paced city life and a quiet place to raise a family. The little extra commute time was a small sacrifice compared to all the benefits. Years down the road each little town and city got more populated, faster paced and a lot busier. Now people are moving further and further north for a chance at a life they grew up with. However, I’d like to tell you about an amazing neighborhood nestled in the upper hills of East Layton called Fernwood Hollow. Located only 20 minutes from downtown Salt Lake and 15 minutes from downtown Ogden, this East Layton neighborhood encompasses this lifestyle and a more convenient location.

Fernwood Hollow is a matured East Layton subdivision that offers peace and tranquility, and is hidden away by the vast amount of trees and gullies. It seems nearly invisible from the busy fast paced city life. All the homes have their own unique look, lot sizes range from .50 to over 1.00 acres and home prices range from $230,000 to $800,000.

This East Layton neighborhood is close to hiking, biking and horseback riding trails as well as within 7 minutes of three water parks (Layton Surf and Swim, Cherry Hill and Lagoon A Beach a division of Lagoon Park). Cherry Hill and Lagoon Park also offer many other activities, rides and more. Snow skiing, water skiing and camping are all within a 30 minute drive.

Fernwood Hollow has quick easy access to Highway 89, I-84 and I-15.

Visit my Fernwood Subdivision website to view a full tour of the neighborhood, plat maps, school information, local business, demographics and available homes for sale.

Due to the popularity of East Layton and Kaysville the averages show that homes in this particular neighborhood sell within 4 months which indicates good movement and a stable market according to the absorption rate. To view the homes for sale in this neighborhood, visit my website and click on the Fernwood Hollow Subdivision.

Posted By: Brad Sears


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September 01, 2009

What Two Factors Sell a Home

Posted to Sellers, Steve Randall

For the past several weeks we have been running about Northern Utah showing properties to those who want to take advantage of the $8,000 tax credit. The rules are that you need to be in your home by November 30, 2009 to qualify. This is free money to incent the purchase of real estate. As a result we are busy trying to find just the right home.

One of our clients is looking for herself, her mother, and her aunt and we have looked at homes in Weber and Davis Counties in the $150,000 range. Several of these homes we have liked have already gone under contract because there are other buyers out there as well. Lesson learned is that if you like it make an offer now and not come back in five days after looking at other homes.

As we have looked at many homes I have watched my buyer carefully review each home with an open mind thinking to herself how this home might meet her family’s needs. We have been to some very good homes and a couple that we wonder will ever find a buyer. One home we visited was in such bad condition that we opened the door… were hit with smells that made us turn right around and leave. As we backed out of the driveway and pulled away an officer turned on his squad car lights and pulled us over. He wanted to make sure we weren’t the owners… or dealing drugs as some of the neighbors had complained about after hour visitors. We assured him that we were upstanding citizens and he let us move on to our next house! What drew our buyer’s attention to this house? It was the price. What turned her to another home? It was the condition of the home.

This may be an extreme example, but the two factors that attract buyers in this market are price and condition. If it is not priced to sell and the condition is not good… buyers move on to the next property. The best advice to give our Sellers is to price it right and see that the condition of the house is the best it can be.

Later we visited a home that was priced right and in very good condition and that is the house she made the offer on! Now you know… Price and Condition!

Posted By: Steve Randall


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August 13, 2009

Home Value Code of Conduct (HVCC)

Posted to Steve Randall

New legislation and policies governing the lending process are now in place and having an impact… good and bad. One of these changes is the new Home Value Code of Conduct or HVCC. The intent of this change is to give appraisers a space, free from outside influence, to give lenders a correct value for a home. The intent of the change is good but there are always unintended consequences with any new piece of legislation.

Before HVCC, lenders were able to choose their appraisers and could exercise some influence on those decisions made by the appraisers. In addition, Realtors could also contact appraisers and send comparison properties used in setting the listing price which also had an influence in the appraiser’s decision. In most cases this system worked well but there were also many cases where some felt the appraisers were being unduly influenced.

HVCC changes how the process work so that lenders and Realtors are limited in their contact with appraisers .

Now the process is that lenders contract with an AMC company who chooses an appraiser and works directly with appraisers. This lessens the outside influences on appraisers and the intent is to give appraisers a path to more accurate appraisals. The intent of the law is good.

There are unintended consequences however that are not good for both buyers and sellers. For example, using the AMC as a middle man means that appraisers are getting less money for appraisals because the AMC is taking a part of that revenue for their services. Now appraisers must do the same work for less money. Some local appraisers may turn down work and as a result appraisers from outside the area are doing those reports. Appraisers may travel 60 to 130 miles to do appraisals in areas that they do not know well. Furthermore, HVCC causes each appraiser to be cautious in the choosing of comps (I would too in these circumstances).

The net result is that appraisals are taking longer and may be lower than the market value causing some transactions to fall apart. As long as our sellers and buyers are aware of the possible bump they are normally OK and can make the needed adjustments.

We had a home in West Point, Utah that had this very issue hit them this month. The seller had to adjust the price and the buyer had to give up some closing costs to make the transaction work.

Posted By: Steve Randall


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August 11, 2009

How Precious Is Your Time?

Posted to Brian Morris

How precious and important is your time? If you had 20 to 30 hours of extra time, what would you do? Would you spend more time with family; how about skiing, hiking, biking, fishing, knitting or even earning more money? How much would you be willing to pay per year for an extra 20 to 30 hours? I want to spend some time speaking to self-managing real estate investors and how they can recapture 20 to 30 hours of their lives.

Before doing so, let’s make some assumptions and form a foundation on which to build our discussion. Let’s assume you own a small duplex that has gross rents of $1,000 per month. Your property is a good property, but there are the normal wear and tear issues you attend to. Although your vacancy rates are low, you still advertise your property two or three times per year because of expired leases, skip outs or evictions. When vacancies occur, you do spend time doing extra cleaning so that the property is ready to show to interested parties. You also take calls from potential renters, review applications, and perform credit and background checks. You typically have no problem collecting rent, but you do need to call tenants from time-to-time to remind them they are past due. Occasionally you post Pay or Quit Notices for residents who still don’t pay after your reminder call. In short, you do quite a bit of work maintaining and operating your property; possibly more than you assume.

Throughout your ownership of the property you have probably wished that there weren’t so many issues. You haven’t taken any extended vacations for fear that something would go wrong with no one there to handle the problem. If you have taken a vacation, you may have received a call from your resident about a dishwasher not working or a plumbing leak. There have been times when you have an important deadline at work and are interrupted by an issue at the property that needs your immediate attention. Isn’t it wonderful to be an investor/property owner?

Now let’s discover how you can relieve yourself of those responsibilities and let the property generate income. You can typically hire a property manager or management company for 7% to 10% of the gross monthly collections. The services these companies provide can include the following:

  • Advertise your property with “For Rent” or “For Lease” signs. They also will advertise the property on websites and/or do virtual tours giving more exposure.
  • Screen and select prospective tenants. Note: make sure management company will abide by all fair housing laws.
  • Negotiate lease agreements and ensure all paperwork is filed properly
  • Collect rents, security deposits and other funds in the operation of the property
  • Serve termination, pay or quit and/or other notices as necessary
  • Employ legal counsel to enforce and protect your interests as a property owner
  • Dispatch facility management personnel on service requests
  • Work with service and supply vendors for the operation and maintenance of your property
  • Perform repair services in the absence of the owner. Note: these repairs should only be completed after written notice is previously sent.
  • Perform and complete emergency repairs related to “water,” “blood,” or “fire” so that the property is protected and owner liability is reduced

Again, assuming that, as we did in the beginning, you collect $1,000/month for rent you would spend $70 to $100 per month for management services. But where are you recapturing the 20 to 30 hours? Well, at a going labor rate of $40/hour if you divide that into your monthly management fee, you will have 1.75 to 2.5 hours per month to attend to other pursuits. Over the course of the year, that will be 20 to 30 hours. How many times have we caught ourselves asking for a little bit more time in our lives? Many people can generate one, two or three thousand more dollars in 20 to 30 hours, which definitely offsets any management fees with a little extra to spare.

Again, How precious and important is your time?

Posted By: Brian Morris


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August 10, 2009

Are Unit Sales Increasing in Northern Utah?

Posted to Steve Randall

It is always nice to have market statistics to help us judge if there is a shift taking place in the area that you live in. Our Board REALTOR® magazine called “The Voice” recently published unit sales statistics by zip in Northern Utah. Units sales increased overall in Northern Utah by 11% from May to June of this year. That is positive news given the large amount of inventory we currently have. The good news for sellers is that the average price increased 5% from $212,859 in May to $223,632 in June. This is a hefty increase for one month but it makes sense as many who are moving want to be in by the time school starts. These numbers, if they continue, will show that the bottom of the market was in the summer of 2009. A slow rise is expected over the next six months.

For details about each zip code in Northern Utah please click here. See how your local neighborhood did!

Posted By: Steve Randall


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August 05, 2009

Why Are Appraisals Coming in Low?

Posted to Steve Randall

For the past few days we have been talking about when the market will bottom out. Today NAR announced that for the fifth straight month home sales across the country have increased. This is good news that more buyers are jumping back into the marketplace. So with all this good news why are home prices still falling in most areas? The fact remains that inventory of homes remains higher than the number of buyers. True, it is adjusting to a more balanced market but with unemployment high, economic conditions on shaky ground, and homes in some phase of foreclosures equaling over 45% of the market….homes are experiencing a downward trend.

If the market wasn’t already hard enough for sellers, we have a new gift from Freddie and Fannie that impacts how appraisers value homes. Although the purposes of this act are something we should strive to achieve, there are always unintended consequences that come from any new government program.

For example, we are working with our buyers to purchase a home in West Point. It is a very nice home and our buyers are anxious to move in at the end of the month. There were multiple offers on the home and the first buyers to have this home under contract had an FHA appraisal done on the home but were not able to complete the sale. Once an FHA loan is done, that value remains with the home for a six month period of time. This is where we entered with our offer. As we have done our due diligence we find the earlier FHA appraisal shows that our offer too is above this value. Both the seller and the buyer are now trying to figure out just what to do!

What makes the difference in offers and appraisals? The comps we used showed our offer to be within the range an appraiser could use. The appraisal done by the FHA appraiser was likely conservative given the new HVCC regulations and wanting to make sure that estimates of value were easily justifiable. There is not blame meant for any appraiser but simply to explain how the new Code of Conduct is having an impact on the appraisal values of homes and impacting sales even though buyers and sellers are agreeing to pay the price. The problem comes in that buyers cannot get a loan for more than the appraised amount which can cause many transactions to fall apart.

Here is more information on the HVCC Program directly from Freddie Mac. If you need help in understanding how to sell or buy a home in this market, please send me an e-mail.

Posted By: Steve Randall


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August 04, 2009

WHEN WILL WE BOTTOM OUT? GOOD NEWS IS SLOWLY COMING!

Posted to Steve Randall

With so much talk about health care, we often forget that it will be real estate that will lead us out of the recession that we are in. In yesterday’s blog we reviewed by zip code how prices have diminished in almost every zip code. No areas of Salt Lake County saw an increase and only Orem in Utah County saw a 5.3% increase. In Davis County, Kaysville and Centerville showed modest increases of about 2%. North Ogden and Riverdale also showed increases of 2.1% and 2.4%.

Lowering prices means greater affordability for buyers. Low interest rates and lower prices make this the perfect buyer’s market. The market may be showing signs of reaching the bottom but prognosticators do not know exactly when the market will rebound. Some pundits felt that the recovery would start in 2010. Others predict that it will take longer and estimate a return to a normal market to be in 2013. Almost everyone believes that the recovery will be a moderate increase each year and will likely take six to seven year to get back to 2006 highs for property values. Click here for more on this point.

As much as we want things to return to normal, we likely will see appreciation rates near normal levels of 5%-6% per year rather than the 89% growth rate we saw from 2000 to 2006. This is the best news we could have given the current economic conditions. As long as employment numbers remain high that means that foreclosures will continue to plague the marketplace. The absorption rates (the rate at which houses are being sold in the market place) are coming down and gradually tipping in the seller’s favor. It is still a buyer’s market but the bottom and possibly the shift to a more balanced market is on its way.

For more information on using real estate investments try this link. For more information on home prices in your neighborhood please contact me.

Posted By: Steve Randall


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August 03, 2009

When Will We Hit Bottom?

Posted to Steve Randall

One of the most frequently asked questions is when will Northern Utah Real Estate hit bottom and how quickly will it return? Last week, the Deseret News published an article on the Utah Housing Market showing that with very few exceptions, Utah is still declining but at a slower pace than in months past and we fare much better than many parts of the country. Here is the complete report from the News Article and here is a valuable chart listing how prices have move by zip code compared with this same time last year.

It is evident that the bottom is getting closer but not yet in 2009. So when will it turn around? Stay tuned for tomorrows blogging prognostication!

Posted By: Steve Randall


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June 30, 2009

Creating Memories in Weber County

Posted to Brian Morris, Northern Utah Recreation & Attractions, Ogden

During the years of ‘87 through ‘89, my friends and I took up the sport of skateboarding. We were a crazy bunch of kids with lots of ambitions and dreams. We idolized the likes of the Bones Brigade and other famous pro skaters. Our days were either spent skating at the local high school, making the three mile trip to Village Fair (local skateboard shop), watching skate videos or spending hours at the magazine stand looking at Transworld and Thrasher Magazines. Ours was a world formed around our Ogden neighborhood and everything outside of that area was foreign. I still consider those the best days of my childhood.

Why would you want to know about a bunch of bratty kids and their skateboarding adventures? Well, it’s not that what we did was significant or important (it really was to us), as much as it was that our neighborhood created memories. It was an area of safety for us; an area where friendships were formed and still remain strong today.

My feeling is that Ogden, North Ogden, Pleasant View, Harrisville, Plain City, Roy, West Haven and other Weber County cities still provide these neighborhoods of memories. These are communities that offer many activities throughout the year, including Independence and Pioneer Day activities. These are communities that have swimming pools and community centers; many of which have been built in recent years. These are communities that are close to recreational areas that offer biking, hiking, skiing, snowboarding, boating and camping. These are communities with great educational and higher educational institutions. In short, these are communities that offer opportunities to create memories.

I have been fortunate enough to live my entire life in this area and love it abundantly. Many of my friends who have moved out of state yearn to be back in this area which helped form our lives. I know life changes; however, I never let an opportunity to create a memory in this area pass by. In fact, almost every Saturday, my children and I make it to the North Ogden Skate Park to create our memories.

Posted By: Brian Morris


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June 17, 2009

The Pieces of HOAs

Posted to Brian Morris, HOA

One of the main goals and benefits of living in an HOA (home owners association) is the protection of property values. Value protection can be accomplished in several ways; however, it can more typically be catagorized in three different areas: maintenance, management and assessments.

Maintenance:

Maintenance is the process and means in which all of the physical aspects of the community are cared for. This can include lawn maintenace, tree trimming, weeding of planting areas, planting of flowers and trees, fertilization, mulching, snow removal from streets and walkways, exterior building repair or replacement, light repair and replacement, pool maintenance, corridor cleaning and maintenance and so on and so forth. These are typically day-to-day activities and require consistent attention because of constant changes which affect communities.

Management:

Management is the supervision or control of both maintenance and finances for the community. Maintenance managment would include negotiating contracts, writing contracts, creating work orders, scheduling work activities and ensuring work is completed as outlined. Financial managment consists of creating budgets, receiving and issuing payments, analyzing expenses and ensuring cash flows for short and long-term objectives.

Assessments:

Assessments, annual and special, are specified amounts levied to cover the costs for services and financial obligations of communities. Monies from assessments act much like municipal, state and federal taxes would; however, they apply to the community only. The amount of assessment depends upon the services provided to the community or what is requested by a majority of home owners. If owners want higher levels of service or additional services, they should expect to see higher assessments and vice versa. Each year annual assessments are established to cover estimated expenses for the year, a portion of which should be set aside for capital expenditures. Also, annual assessments should be expected to rise to offset cost of inflation. Special assements are levied for any unexpected expenses that may occur during the year; however, associations can greatly reduce the likelihood of a special assessment by wisely establishing budgets. Healthy budgets can increase the marketability and protect the property values within associations.

If associations and management can balance these areas, property values will find themselves at the higher end of markets and ensure that owners experience good returns on investment.

Posted By: Brian Morris


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June 06, 2009

What Does It Take to Sell an East Layton Home In Today's Market?

Posted to Steve Randall

Anyone selling a home in today’s buyers’ market knows that the market can be brutal. Buyers have lots of inventory to choose from and are expecting closing costs to be paid for by the Seller as well. We recently closed a rambler home in East Layton and as I added up all the factors I found it interesting to see what it really takes in today’s market to sell a home.

SELLER UNDERSTANDING OF THE MARKET: In this property the Seller lives in Arizona and has already experienced the housing downturn there so he knew what he would face here in Utah. The home has a great location, good highway access, in very good condition. The Seller replaced the carpet upstairs with a nice grade of carpet to give it a newer home feel. The home was in good condition but had not been fully updated, and the backyard had a great view but dropped into a steep valley leaving very little backyard. The Seller understood the dilemma and priced the home accordingly to compensate for those issues. The home actually sold for 20% less than the original list price hoped for by the Seller and closed in 112 days.

Internet Marketing: With over 90% of the population looking for homes online, a full out marketing campaign began with a full virtual tour that tracked 10,188 views and 2,227 unique visitors to the home by the Internet. We marketed the home on 34 websites with enhancements on Realtor.com that doubled the normal views. Realtor.com is the most used real estate website and we wanted to make the home standout online. Other sites driving traffic to the home were Google, Homedebut, and Zillow. Our local MLS, RELO® Home Search, and our own website were also great contributors, especially for agent to agent marketing. It makes sense that most of the views came from Utah but we also had traffic from California, Florida, Illinois, Hong Kong, Arizona, Arkansas, Minnesota, Nevada, Oregon, and Texas. In total, the Internet market showed 19.88 tours per day. It is not surprising that the buyer found the home on the Internet and then asked their agent to show it to them, resulting in a purchase.

Showing Desk: Our showing desk has 24/7 coverage for any calls coming in from agents or off the Internet and schedules showings and gives feedback from those showings so we know how potential buyers react to the property. We had 14 actually showing at the property with about 20 virtual tours each day.

I can tell you that this was a fun property to market with lots of traffic. For more marketing information please e-mail steve@welchagency.com.

Posted By: Steve Randall


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June 05, 2009

Free money anyone?

Posted to Brad Sears

Well, if you are purchasing a home in Clearfield, you may qualify for their Down Payment Assistance program. There are certain guidelines and such that need to be met, but if they are, you can get up to $5,000 to use towards your down payment or loan costs. There are other cities with similar programs with similar requirements, so before buying a home, contact the city to see if they have a program that may work for you.

Here are some of the details of this program in Clearfield:

  • The funds are given out on a 3 to 1 match. This means that if you contribute $1,000 of your own money, they will contribute $3,000. To get the full $5,000, you would need to contribute at least $1,666.67. The minimum contribution is $500.


  • Your household income must be at or below their “Maximum Yearly Income” table based on the number of people in your home.

    Household SizeMaximum Yearly Income
    1 Person$38,350
    2 People$43,850
    3 People$49,300
    4 People$54,800
    5 People$59,200
    6 People$63,550
    7 People$67,950
    8 People$72,350


  • The home must be inside the Clearfield City boundaries


  • It must be a home that is not attached to another home. So condos, townhomes, or other attached properties are not eligible.


  • The loan used to purchase the home must be a fixed rate loan that is either FHA, VA or Conventional.


  • You must complete a Home Buyer Education course that is approved by them. This can be taken online at http://extension.usu.edu/cooperative/hbe


  • This grant does not have to be paid back if you live in the home as your primary residence for 7 years. It is technically a lien against your home that decreases by 10% for each full year you live there and fully forgiven after 7.

For more details, you can visit their website

Please don’t hesitate to call or email me at 801-597-1406/brad@bradsearsteam.com.

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May 15, 2009

What is Working in Washington DC?

Posted to

Today, we return to Utah. These meetings are held annually for the purpose of updating our Realtor task forces on the national market economy, new political rules and regulations impacting property ownership, and what our political leaders are doing to get this economy back on track.

One thing is for sure when you come to Washington is that there are many solutions (arguments) for the same problem. With all these voices and competing ideas it is important to stay focused on the facts as they really are in order to keep some perspective amidst the war of ideas and words that rule Washington.

For starters, let’s look back at 2008 and see who has been buying homes and why. That may give us a clue as to what is working and what is not. From our NAR statistics, we find that 41% of recent buyers were first time home buyers. That is not surprising in that housing is more affordable now than in any time we can remember. With interest rates lower than we shall ever see for the rest of my lifetime, new buyers are taking advantage of lower prices, low interest rates, and now the Government has added a new $8,000 tax advantage and in Utah, the State Government also has a new $6,000 grant for new construction homes. This part of the plan is working and should continue.

Even though all real estate is best understood on a local basis, national averages are also interesting to look at. For example, the typical home purchased in 2008 was 1,824 square feet in size. Seventy-eight percent of all homes purchased were a detached single family home. The median price of homes purchased was $218,000 in the Northeast, $174,000 in the Midwest, $185,000 in the South, and $267,000 in the West. Interesting enough, in Utah home prices have fallen but not the extent of most other areas of the country. In, Utah, houses are now more affordable but it is also important to note that there are strong pressures to maintain values because of employment stability, sound State government economic policies, and constant population growth.

One area that needs to be fixed is the area of “short sales”. There are so many short sales on the market right now that buyers are frustrated that when they make offers they cannot get a response without waiting for a seemingly endless amount of time. Realtors, Sellers, and Lenders need to modernize this process in order to take the surplus inventory off the market.

For a list of short sales on the market, or for a list of all homes that are not short sales, please contact me at steve@welchagency.com.

Posted By: Steve Randall


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April 29, 2009

How Much Home Can I Afford?

Posted to Brad Sears

One of the first things people should consider upon deciding to buy a home is how much of a home will they qualify for and does that comfortably fit into their budget. Trying to figure that out can be a little tricky since most people only buy three to four homes in their entire lives. First, let me say that what you qualify for and what you can afford are usually two totally different numbers because lenders will often qualify you for more than you can truly afford.

My advice is to always stay within your comfortable limits!

When you apply for a mortgage, lenders will look at two things to determine how much you can afford monthly:

  1. Your total monthly mortgage payment compared to your monthly gross (pre-tax) income and
  2. Your total monthly debt (including the mortgage) compared to your monthly gross income.

Lenders refer to these two calculations as Debt-to-Income ratios (DTI). They want to know how your debt compares to your income. The first one listed above is called your Front End Ratio and the second one is called your Back End Ratio. The way to calculate these are:

  1. First figure out your monthly gross income. If you are paid every 2 weeks, multiply that amount by your 26 pay periods per year and then divide by 12 to get an accurate monthly income.
  2. Determine what you can comfortably afford for a home payment each month
  3. Then divide that payment by your monthly income. This will give you your front end ratio.

Most lenders want your front end ratio to be no more than 33%, but there are programs out there that allow that amount to be higher.

To calculate your back end ratio:

  1. Add your total monthly debts together (car, credit cards, student loans)
  2. Add that to your home mortgage payment to get your total monthly debt payments.
  3. Then divide that payment by your monthly income. This will give you your back end ratio.

Back end ratios can range from 41% to 55%. You’ll want to just talk to a mortgage loan officer to get more detail as to what you can get, but this will give you a good idea of what you qualify for. One additional piece of advice I could offer, pay down and pay off debts because a $5,000 debt could equal $20,000 more of a house! That’s the kind of math that most people like.

Posted By: Brad Sears


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April 28, 2009

What Makes Us Unique?

Posted to Steve Randall

For the past several weeks we have been watching an increase in the number of buyers entering the market. It is the beginning of a glimmer of hope for our sellers. However, we must be cautious in our predictions because more listings are being added than actual homes selling, forcing our sellers to be vigilant in the pricing of their homes.

I was asked recently by a potential seller how we were different than other brokerages in our area. I thought I would share it with our readers because most real estate companies do look alike.

This would be my response to anyone asking what make this Leading Real Estate Company unique. Of course we do all the things that every other brokerage does such as yard signs, advertising, lock boxes, toll-free numbers, call captures system, websites, virtual tours, CMAs and more….but the following seven items separate us from other real estate agencies. We hope that they will be the reasons you choose us as well.

What Sellers receive when they list with Leading Real Estate Companies of the World® (LRE) through their local Ogden office - Welch Agency:

  1. REFERRED BY A TRUSTED AGENT: The first benefit is the ability to work with referring agents and with a leading local real estate brokerage. Welch Agency began in 1963 and has been a member of LRE for many years.


  2. YOU CHOOSE THE SALE PRICE OF YOUR HOME: In order to be your partner in the process of selling your property for the highest price in the shortest amount of time, we want to become your partner. Once you have reviewed the comparable sales in your neighborhood, we let you choose the price. If for some reason, the market will not cooperate and the price needs to be adjusted, then the percentage of our commission is reduced on the listing side of the commission by the same percentage as the percentage reduction of the home from its original listing price. In addition, if we bring the buyer without the assistance of another agent or office, the brokerage fee is limited to 3% of the home’s sale price. That is a 50% savings to our Sellers.


  3. PAY FOR PERFORMANCE IS PARAMOUNT: We believe in backing up our claims of action, performance, and exceptional client communication by allowing each of our sellers to cancel the Listing Agreement by sending written notice to our office by postal mail or by e-mail at any time during the listing. If you are not completely happy with our services then you are free to move in a different direction.


  4. WORLDWIDE RELOCATION NETWORK: Through the LRE Network you have access to over 5500 offices and over 170,000 associates nationwide giving you the greatest access to relocation buyers of any company. We specialize in bringing buyers to our Sellers, which is what our Sellers really value. Every day, hundreds of potential buyers visit our company website, request information, and we send these buyers your property information even if it is not what they are looking for simply because they may change their mind or know someone who is interested in that property.


  5. LOCAL, NATIONAL, AND INTERNATIONAL WEBSITE PRESENCE: With most of the world searching for homes online, the LRE Network of websites gives you the most exposure for your property online. Not only is your property listed on RELO® Home Search, LeadingRE.com, Realtor.com, the MLS, and our various company websites, it is also “syndicated” with every major real estate website from Google, MSN, and Yahoo, to Frontdoor.com with the HGTV Network. The exposure and traffic generated by these websites is tracked so that we can tell where, who, when, and what pages potential buyers are looking at when viewing your property online. We also use local websites such as KSL.com and Craig’s List. Each visitor to your home’s webpage gets a beautifully rendered virtual tour, 24/7, to showcase your property on the Internet.


  6. WEEKLY FEEDBACK OF MARKET CONDITIONS: Our Sellers want information on how their property is doing in the market. We give weekly reports (more often if desired) that include website traffic patterns, feedback from showings, research concerning the current RE market, and updates on new and modified listings competing with your property. We also visit all the competing properties in your area so that we know how your property compares with those in the surrounding area.


  7. CRUISE CERTIFICATE: Finally, as a way to say thanks for using our brokerage services, we offer each client a Cruise Certificate for a 5 day, four night “Cruise for Two” to Mexico, the Bahamas, or the Western Caribbean. This is our way of saying thanks for using our services. For those who don’t like cruising, they have used the Cruise Certificate as an incentive for the potential Buyer to purchase their property.

We look forward to being of service to many of the Sellers contemplating listing their homes in the next few months.

Posted By: Steve Randall


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April 22, 2009

1st Quarter Stats - Davis County, Utah

Posted to Brad Sears

I have had several people ask me recently how the market is doing and if we are seeing any improvement. In the chart below, you’ll see 1st quarter comparisons of 2006 thru 2009 of standard single family homes in Davis County, Utah. Although this chart does not include condos, their numbers mimic these pretty closely.

1st Quarter Comparisons 2006, 2007, 2008, 2009 (Davis County)

As you can see, numbers moved in a positive direction from 2006 to 2007 and have declined since then. New listings are down 22% from last year with only 33% of the listed homes selling. With interest rates as low as they are and with all the programs for first-time home buyers, if you follow the advice below, there is no reason your home shouldn’t sell.

Here are some MUSTS to help your home sell in this market:

  1. Price your home competitively- Price your home according to comparable homes that have sold within the last 6 months. DO NOT price them according to homes that have not sold and are still active on the market. Especially in this market, a buyer does not want to pay more for a home than what it is “worth.” When a buyer walks through a home, they will compare it to the other homes they have seen. Be sure yours is priced so that they feel it’s not just a fair value, but a good price.
  2. Location of your home- If your home’s location is not the most desirable (next to train tracks, power lines, freeways, busy roads, etc.) you have to lower your price to attract buyers. Remember, you can’t change the location of your home; however, you can change the price and the condition of the home and property. If your home is well maintained and the price is right, it will sell.
  3. The condition of the home- When buyers tour your home, they make a subconscious decision to buy or to walk away within the first 5 seconds. To make your home appealing, have nice curb appeal, a clean well kept home, a pleasant smell when they walk through and remove the clutter throughout. When considering a “pleasant smell” avoid perfumes and lean more towards a clean smell.

If you would like to see these statistics on other counties or individual cities in Utah, please email me at brad@BradSearsTeam.com or call (801)597-1406.

Posted By: Brad Sears


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April 16, 2009

Criticism & The Stress of Leaders

Posted to Brian Morris

I have the blessing of managing several homeowners’ associations (HOAs) along the Wasatch Front. As part of that responsibility, I work with board members in establishing budgets, collecting monthly dues, overseeing expenditures and a myriad of other items related to day-to-day operations. I also have the chance to get to know board members on a personal level and see the stress they deal with while giving voluntary service to their communities.

Much of the stress in serving on an HOA Board is a result of criticism coming from a few homeowners who feel the board should handle any given situation in a different way. In an HOA, it is always good to hear from every homeowner because that makes the process better… and at times criticism is justified and necessary. However, my experience has been that a homeowner with a concern will be better received if they get the facts first and then express their concerns with civility and according to the process outlined by the CC&Rs which are the rules accepted by every member of the community.

The greatest quote I have heard on criticism of leaders comes from a story told by President Abraham Lincoln. He spoke with a group of critics and drew their minds to a performer of his day named Blondin. Blondin excited the country by crossing the Niagara River on a tightrope during the Civil War days. I quote:

“Gentlemen, suppose all the property you possessed were in gold, and you had placed it in the hands of Blondin to carry across the Niagara River on a rope. With slow, cautious steps he walks to the rope, bearing your all. Would you shake the cable and keep shouting at him, “Blondin, stand up a little straighter; Blondin, stoop a little more; go a little faster; lean more to the south; now lean a little more to the north?”

Would that be your [behavior] in such an emergency? No, you would hold your breath, every one of you, as well as your tongues. You would keep your hands off until he was safe on the other side.”
~ John Wesley Hill, Abraham Lincoln: Man of God [New York: G.P. Punam’s Sons], page 402)

It would be wonderful if each member of the community would remember that more will be accomplished with constructive criticism rather than with harsh words or ranker as the Board walks this tight rope. No, HOA Boards are not dealing with the weighty affairs of the country; but they are dealing with the struggles and difficulties of their neighborhoods. Not everyone will not agree with how every situation is handled; but if each member of the community would show patience and common courtesy for those who are striving to do their best, more will be accomplished. HOAs allow for a democratic process where everyone can run for the Board to make the changes they feel strongly about. As neighbors work together to solve their various issues, respecting difference of opinions, it makes life in an HOA a very positive experience.

Posted By: Brian Morris


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April 14, 2009

ALL REAL ESTATE IS LOCAL – Northern Utah March, 2009 Statistics

Posted to Steve Randall

Sorry to have been absent for a period of time. We just moved into new office quarters with the intent to create the real estate office of the future to accommodate the needs of the real estate agents of the future. Moving is very time consuming plus we have been assisting our buyer clients to make their purchases. The result is less time to blog! Sorry about that.

There is still much focus on the economy with an emphasis on monitoring the progress of the return of real estate. The following are the statistics for March 2009. Because all real estate is Local, we thought you would like to know what is happening locally with home sales, home prices, as well as the time it takes to sell a home in the various Northern Utah Counties.

In order to determine when the housing rebound will occur, we need to keep track of the unit sales data, new listings, and monitor the price of homes to see when they begin to move up again. We will try and give you this information in the first week of the following months. Here are February, 2009 results.

  • Unit Sales are the number of properties closed in the month.
  • Median Price is the middle number of the range of homes sales.
  • Average Price is the just that, the average of all homes sold.
  • DOM is the Days on the Market needed to sell the home.
  • New Listings are the number of new listings added in the month.
  • Total Listings are the aggregate of all the listing currently on the market.
  • Month of Inventory is the number of months it will take to clear the current inventory based on the current sales rate.

For those who want to compare numbers of a month by month base here are the numbers for January, 2009 and here are the numbers for February, 2009.

If you are renting and have not owned a home for awhile, this is a great time to be a buyer. With tax incentives, low prices, and high inventory, now is the time to make that purchase. If you need help with the mortgage prequalification process please do not hesitate to contact me (steve@welchagency.com).

Posted By: Steve Randall


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April 07, 2009

This Isn't Rocket Science

Posted to Brian Morris

My wife and I have recently been contemplating whether or not we should refinance our home to a lower interest rate. As we have researched the advantages and disadvantages of refinancing, we stumbled across some “exciting math” that could save individuals large sums of money. I understand that most people may already know how this happens; however, I believe most individuals simply don’t take full advantage of the opportunity. Let’s take a look at a common scenario.

Given:

Purchase Price: $150,000
Term: 30-year fixed
Rate: 5%
Cash On-hand: $5,000
Loan Amount: $145,000

Let’s say the above mentioned criterion describes your current situation. That being said, you would have a monthly principle and interest payment of around $780. However, over the life of the loan you will pay approximately $135,000 in interest. That is a large amount of money going to someone else besides you. But assume that you are a bit more aggressive and pay an extra $50 per month on your loan. What would this do? Could you scrape together another $50 every month? If so, you will save over $20,000 in interest over the life of the loan and cut almost four years off the term. Those are definite savings!

Some will say: “Big deal, I am not even going to be in my house that long.” Well that’s just fine, but say you still pay the extra $50 per month anyway; what would that do for you when you go to sell your home in say 10 years? Well, first you will most likely be able to sell your home for about $180,000 based off a yearly average appreciation rate of 2%. If you sold it at that price you will see gross proceeds in the amount of $70,000 versus $62,000. Still you may say: “big deal, what is $8,000.” Based off of your proceeds and a 20% down payment this could be the difference between moving into a $290,000 home versus a $250,000 home. In short, your $6,000 investment over ten years could buy you $40,000 worth of more home. In short, by putting more money towards the principle, you build your equity quicker. This isn’t rocket science just common sense and self discipline.

Posted By: Brian Morris


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March 30, 2009

Which Industry Will Start the World's Economic Comeback?

Posted to

While attending the Leading Real Estate Companies of the World® convention in Scottsdale, we all had the pleasure of listening to Steve Harney’s Keynote address at our Friday luncheon. As a subscriber to Steve’s “Keeping Current Matters” program, where we are updated in detail on current economic matters, it again came strongly to my mind how … and who, will end the economic situation we find ourselves in. Recovery will start with the real estate industry just as it began with the subprime, mortgage, and credit crisis.

The process will begin, as it already has in Arizona, Nevada, and California; with the proper pricing of homes to sell in this market. My counsel to those who want to sell now is that if you don’t have to sell… then don’t. Prices are approaching their lows from the 2006 highs in Northern Utah. Rather than move, fix-up, remodel, make an addition rather than sell. However, if your ARM is resetting, or if you have lost employment, or you find that you need to sell… price your home to sell in this market so that it will sell sooner than later.

The reason for continued falling prices is that prices in Northern Utah (Utah, Salt Lake, Davis, and Weber Counties), will decline further this year simply because supply is increasing faster than demand is increasing. That means that sellers need to get under the market price and make your house “sale-ready.” This will allow you to stand out in the market and attract that buyer. Predictions we heard at the conference are that we will bottom around November of 2010. We don’t know how long we will stay at the bottom but some national experts say it will likely take our four or five years to get back to 2006 levels.

If you are a buyer, now is the time to buy. In our lifetime there is not likely to be a better time to buy than now. The country will work its way out of this recession and when those signs start to show, more will buy, interest rates will increase, and prices will rise. There is risk if you wait too long. If you are a first time homebuyer, moving up into a new home, or buying a second home, now is the time make that purchase. Timing the market perfectly is difficult to do. Some may want to wait for the very lowest interest rate or the very bottom of the pricing market. Good luck because you won’t recognize those times until they start to come back up and then you may have missed your opportunity. Now is the time to qualify and to buy.

Here are all the latest homes for sale and contact me directly for a list of all current foreclosure and short sale homes in Northern Utah.

Posted By: Steve Randall


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March 27, 2009

Time to Sharpen the Saw

Posted to Steve Randall

cLast night my wife and I had the wonderful opportunity to walk the streets and suburbs of Scottsdale. The weather here was quite different that the snow we left in Northern Utah. It was fun to finally be able to smell the flowers and enjoy a short sleeve shirt experience and PF Changs is always a great place to eat. We left the snow to enjoy Arizona’s blooming flowers and wonderful resort hotels.

One of the great things I like about LRE Meetings is that it gives me time to receive the best and latest updates concerning the economy, housing, new technology, and what our clients across the country want from us. One knows that to sharpen the saw will make the work move faster and more efficiently. That is why we are here.

We also get a chance to look at markets outside of our own. Home values here in Arizona have taken a steep drop in the past two years. The market has gone through the pain of correcting itself and shows signs of new life. The country saw an increase in home sales this last month which we all need to recognize and celebrate. However, there are more foreclosures and ARMs that are resetting to replace the inventory that has been sold.

Interest rates are still the best news for buyers and sellers as they help more people qualify for a loan and help sellers move their homes in this difficult market. Now is a great time for buyers to make that purchase because interest rates have a greater probability of going up than going down much more. This market is a great place to move up into a bigger home or to add a second home. Scottsdale is certainly a great place to have a second home if you live in colder climates.

If you are interested in buying a home in Scottsdale, or any other part of the country, please contact me directly (steve@welchagency.com). We will refer you to our Affiliated Companies in that area. If you need something in Northern Utah, we will help you find that perfect home or to sell your current home and move to that next experience. Client service is the center of our training and we want you to have a great experience.

Posted By: Steve Randall


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March 26, 2009

Property Spot: 2353 E. Summerwood Drive, Layton Utah

Posted to Steve Randall

After a week warm spring-like weather, today is another blessed winter day for skiers! Not far from the resorts, is a prime east Layton area neighborhood near the mountains on the east side of Layton. There are not only beautiful views of the mountains, but also great views of the Great Salt Lake and the valley view out the back windows. This property built in 1988 and located on Summerwood Drive, has 3,286 sf.; 5 bedrooms and 2.75 baths. For the buyer who want to add equity in a move-up buyer’s market, this is the perfect property. The basement is 50% finished and new carpet has just been laid on the main floor.

The back yard looks over the valley to the north down into the valley and creek below. The deck off the back allows one to sit and ponder about the beauties of nature while enjoying a grilled hamburger! Within a fifteen minute drive you will find the Layton Hills Mall, scores of restaurants, movie theaters, and great skiing at Snow Basin and Powder Mountain.

The best thing about this property is that it is price to sell in the current market conditions. The $275,000 listing price makes is one of the most competitive homes on the market. With an $8000 dollar tax credit, a prime Layton location, and access to major transportation hubs and entertainment locations. This is a must see property. Please take a look at the Virtual Tour.

For more information please contact me directly (steve@welchagency.com).

Posted By: Steve Randall


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March 24, 2009

Tired of Bad Real Estate News?

Posted to Steve Randall

If you are tired of bad real estate new like most of us, then here is a great website for areas of the country where some good things are happening. You will need to register but the information is free! Look up your city and see where unit sales are increasing or prices have gone up in the past month. Click here to get your good news.

Posted By: Steve Randall


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March 20, 2009

Mortgage Rates to be Impacted by Trillion Dollar Infusion of Cash

Posted to Steve Randall

While the country’s attention has been focused on the executive bonuses paid to AIG officials, an unprecedented injection of one trillion dollars has been authorized by the Federal Reserve in order to assist a national housing market that continues to languish. While political pundits argue of the overall effect of this huge injection of funds, the intent is clearly aimed at lowering mortgage rates so that more people can afford to buy homes with monthly payments they can afford.

Fannie Mae has reported that rates last week have already dropped from 5.03% to 4.98% which is approaching the low this year of 4.96% on January 15, 2009.

If you have been sitting on the sidelines waiting to buy a home, then a lower interest rate would likely be of interest to you as it lowers the overall cost of purchasing a home. With the $8,000 tax credit you could add substantial equity to your purchase. Others who are watching rates to see how much lower they can go predict that we are now close to the bottom and future drops will be small with the probability that rates could go higher when the pent up demand for homes hits the market in the months ahead.

Unemployment, job security, the general economy are still impacting consumer confidence and keeping some on the sidelines. The fact remains, however, that real estate purchased now is greatly discounted from its highest values in 2006. We also know that real estate purchased now will make buyers look like geniuses in the future when property values again begin rise.

Our website will give you a complete list of all homes for sale in Northern Utah - here you can search for the most recent listings on the MLS.

Posted By: Steve Randall


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March 19, 2009

Utah Offers $6,000 Grant to Purchase Never Lived in Homes

Posted to Steve Randall

In just a few days, Governor Huntsman will authorize a $6,000 grant with some of the Stimulus Package Money for the purchase of new homes that have never been lived in. This is not a loan that needs to be paid back and can be used with the $8,000 tax credit the Federal Government has established for new home owners as well.

If you are a first time buyer in Northern Utah this new grant has just qualified more buyers and made more homes affordable to more people. There has been $10,000,000 set aside for new construction purchase. If you look at the chart to the right, you can see that exiting sales are down -8.6% from this time last year. This obviously is not a good economic sign for recovery just yet. Pending sales, or home currently in escrow or under contract are up 5.3% when compared to last year at this time. This means we are seeing more buyers in the market right now caused by low interest rates and more affordable housing.

If you look at the New Construction numbers you can see why Governor Huntsman is helping this side of the industry. Sales this year vs. last year are down 48.2%. This new $6,000 grant will help many new buyers with a down payment or closing cost and more buyers will be able to qualify for a loan if they buy a new home that has never been lived in.

For more details or a list of homes that would qualify, please send me an e-mail.

Posted By: Steve Randall


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March 18, 2009

Community Information - Kaysville City

Posted to Northern Utah Recreation & Attractions, Steve Randall

Barnes Park is a great family place and heavily used during the summer. It has baseball parks, volleyball sand pits, BBQ grills and a large bowery for seating of larger family groups. At Barnes park, Kaysville City is sponsoring an Easter Egg hunt on April 11, 2009 (Saturday) at 10:00 am. For more information you can contact Cristin Smith (444-1068).

Here is the April 2009 Kaysville City Newsletter with other community information.

To find all the new listings in Kaysville try this link on my website. Just click on Kaysville and the number of days back you want to look for new listings.

Posted By: Steve Randall


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March 17, 2009

Beware of Scammers

Posted to Brad Sears

The government is warning homeowners to be aware of scammers making money from President Obama’s foreclosure prevention plan. Apparently, many homeowners in need of help from this plan have filed complaints that they were contacted by firms promising to quickly and efficiently negotiate with banks on their behalf to avoid foreclosure. They asked for upfront fees of $1000 or more and didn’t deliver.

There are non-profit agencies partnering with the Federal Government offering free counseling for families needing to take advantage of the foreclosure prevention plan. You can find them here.

Source: http://www.realtor.org/rmodaily.nsf/pages/News2009031601.

Today’s interest rates:

Conforming Fixed 30 year rate: 5.25%
Conforming Fixed 15 year rate: 4.75%
Conforming 5 year ARM: 4.875%
FHA Fixed 30 year rate: 5%
FHA Fixed 15 year rate: 4.75%
FHA 5 year ARM: 5.625%

Posted By: Brad Sears


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March 16, 2009

FAQ from First-Time Home Buyers

Posted to Steve Randall

Questions from First Time Home Buyers: What is the difference between being “Pre-Qualified” and “Pre-Approved” and does it matter when I make and offer?

Even in today’s buyer market, Sellers are more apt to negotiate with a Buyer who has a lender’s letter stating that they are a qualified buyer. Having a lender’s letter prepared and attached to the offer can save a buyer hundreds, if not, thousands, of dollars because Sellers know they are working with a buyer who really can purchase their home and therefore are more willing to negotiate on price and terms.

Pre-Qualify: When you meet the first time with a lender, you normally “pre-qualify” for a loan amount. This allows you to know what you can comfortably afford based on your income and credit scores. A Pre-Qualification Letter is more informal and allows the lender to review your current financial status so the lender can tell you the spending limits for any offers you make. This is an important first step that every buyer should do before they make their first visit to any home.

For all of us, getting pre-qualified makes us a little nervous because it is a little like judgment day! We often wonder if that car payment we missed two years ago will show up? Will my income be sufficient to buy a home I would like? How much paperwork will they need to see? The fact of the matter is that most lenders can do most of this work with the Buyer over the phone in 30 minutes or less! They may ask you to drop off certain paperwork but within a few days they can present you with a Pre-Qualification Letter so that you are now ready to really start looking at homes and able to make offers.

Pre-Approval: With the pre-qualification process done, you can now start to look for homes. As you spend time looking for homes the lender will continue to put together your financial information, verifying data that you have presented to them, and finalizing your loan so that they can present you with a “Pre-Approval” Letter. The Pre-Approval letter is the lender’s guarantee in writing that they can give you a loan. The Pre-Approval letter is a stronger signal to the Seller that you are a qualified buyer and is preferable to a pre-qualification letter when submitting offers. From the Seller’s point of view, if you have a pre-approval letter then you are considered a stronger buyer because you have already qualified and the Seller knows that you can close on the date you say you will close because the lender has said that they would give you a loan.

One last thing, you may qualify for more than you want to spend. Let’s say that you qualify for $175,000 home but the home you want is only $150,000. The lender would then prepare a letter that would attach to your offer for the $150,000 amount. As the Buyer, you don’t want to show all your cards - you are negotiating with the Seller so the lender may have to give you several letters over time as you make various offers on various properties.

Here are samples of two lender forms with the questions and information most lenders will need to know in order to approve your loan:

Sample Pre-Qual Form #1
Sample Pre-Qual Form #2

As always, we have lenders who our buyers have worked with and recommend. For a list of those lenders please e-mail me directly.

Posted By Steve Randall


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March 13, 2009

Community Update -Moving From Winter To Spring in Kaysville, Utah 84037

Posted to Steve Randall

One the great things about living in Utah is the change of seasons. The months of March and April are two months where you can do so many things. If you live in Kaysville, you are only 45 minutes away from some of the best ski resorts in the world. While some skiers are bemoaning the coming of warm weather, some resorts stay open until almost the end of June. March and April are still great ski months is you live in Kaysville.

What you also see is the die-hard marathon trainers who run miles and miles starting at 4:00 am (still dark) as they run on the wider roads of Highway 89 down to Lagoon, out west towards the Great Salt Lake, and then back to Kaysville. It is easy to get 12 to 18 training miles in a day to get ready for the spring marathons.

Finally, those of us who are road bikers begin to move from our home spin bikes to the actual road with sunlight! Temperatures for morning rides start in the 40s and end in the 50s this time of year. We occasionally are forced back into the basement with a spring snow storm but it melts quickly and gives those new found muscles a chance to rest. It is always great to have the new Legacy Parkway that starts at the Front Runner Station in Farmington (right next door to Kaysville) and runs 17 or 18 miles into Salt Lake County. These are flat, easy rides and good to get the stamina built back up.

Here is a good website to use when you want to find some great out-of-door, family oriented, things to do when living in Kaysville. There are currently a 198 homes in Kaysville for sale. To see all of those properties, please click here or send me an e-mail.

Now is a great time to come and enjoy all the activities that can be done when you live in Kaysville.

Posted By: Steve Randall


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March 11, 2009

What's Ahead? Mortgage Rates Are the Reasons Buyers Should Buy Now

Posted to Steve Randall

In today’s post we want our Buyers to take a look ahead to see what is likely to be coming in the future as it relates to mortgage rates. One of the best ways to look ahead is to look back for an historical view of what happened to interest rates when they saw a prolonged drop over a period of weeks. We thank Steve Harney, with SteveHarney.com, for these graphs showing the history of interest rates beginning in January of 2008 and ending in January of 2009.

As you look at this graph you can see the range of interest rates from a high of almost 6.7% to a low of 4.75%. You can see where twice the Government stepped in to take over Fannie and Freddie and later to add $500 billion dollars of money to bail them out. The reason for this bailout was to make sure that the market didn’t get worse and to aid the market by moving interest rates downward making homes more affordable for buyers.

Since October 31 of 2008 you can see almost sixteen weeks of interest rate declines with mortgage rates almost at the historic lows in the US.

In looking ahead, one only has to look back to 2003 when interest rates dropped below 5.75% only to see that each of the four times it dropped there were fast rebounds to higher interest rates. In other words, when the rates hit their lows, the rates increased rapidly back as new buyers entered the market.

This market data shows buyers that if they are waiting for interest rates to go down a few more basis points before they buy, the chances are greater that the rates will increase rapidly more than the chances they will go down much further. An educated forecast would show the probability of rates increasing is more likely than rates declining much further.

So if you have family, friends or work associates waiting to buy for the best of the best interest rates let them know that they are taking a greater risk by waiting than by buying now even if rates do go down a little more. The trends tell us that now is the time to buy. Here is a place to search for all the listings in Utah and don’t forget our free Buyers’ webinar every month.

Posted By: Steve Randall


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March 10, 2009

Finding a Home for Katy Marquardt!

Posted to Steve Randall

This past week has been one filled with meetings and webinars relating to real estate. At Bush Intercontinental Airport in Houston, I perused the news stands for something interesting to read as I was preparing to fly back to Salt Lake City. Reading off line is getting to be a bit of a novelty as I walked through the airport witnessing the many travelers with their laptops and Blackberrys in hand.

As we flew over the Houston area I began to read about how the current economic down turn is changing our savings plans, stock investments, and retirement plans. I was curious to read the various articles on the stocks to pick in order to recover the losses of the past year. I quickly grabbed my real estate calculator to run some numbers.

If a person had invested $100,000 in the stock market at its peak, they would have a little less than 50%, or $50,000 remaining today. I began to look at the projections of future stock growth once we hit bottom and begin to build again. These prognosticators reviewed the historical 10% growth rate for the stock market over many years. Since I was invested in stocks since 2000, the stock market has gone don 19.8%, the S&P down by 35.2%, and the NASDAQ, down by 59.9%.

I am still looking for the 10% growth rate of the early 90s. During this same time period, real estate was up 72% at its peak and at the end of 2008 it had dropped to 69.2% since 2000. Most estimate the stock market will take awhile to come back and at a slower 7% rate rather than 10%. At a 10% rate it will take eight years to get back to where we started. At the 7% rate it will take us 11 years. Remember, that is just back to where we were!

As I continued to read I came across an article by Katy Marquardt, entitled “Time to Buy Stocks or a House?” (US News & World Report, pg. 57). Katy muses about her current one-bedroom apartment life and if she should continue to invest in stocks now they are cheaper; or in a house now that they are more affordable. She is worried that she might have missed her best chance to buy a home.

After some deep pondering she quotes Carmen Wong Ulrich: “A House is not only a symbol of financial strength and stability. It serves you with a roof over your head and a place to have family and friends. Priceless!” She concludes in her own words, “Stocks seem like the simpler choice, but buying a house guarantees a huge return for me— even if it’s not financial.”

Katy, let us help find you a home! This is the time for Buyers to make their move! Homes are plentiful and more affordable. Interest rates are still very low. Government incentives are set to help first time home buyers make that first purchase. Katy, you haven’t missed your window! Call or e-mail our office and we will get the process started. With our 4,700 Leading Real Estate Companies of the World® offices scattered across the nation, we can help you find a home this week!

For the rest of the world you can search for home easily on this website! Don’t miss your window of opportunity. If you run into Katy, please have her give us a call!

Posted By: Steve Randall


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March 09, 2009

Is the Internet Changing Your Life Too?

Posted to Steve Randall

There is probably no more recognized word in today’s English language than the word “Internet.” This new technology has changed the way we interface with each other, how we do business, and how we do commerce. I was at a meeting with over 500 Realtors when the presenter asked us how many leads we had received from our postal mailings recently? A few hands went up which represented a very small percentage of the total group. The next question was how many in the group had used the telephone book recently to look up a phone number? A few more hands were raised, especially those who were older, but not everyone who was older. As I thought back on how I looked up numbers my mind went straight to Google! I couldn’t even remember where my phone book was! Each question the presenter asked found its way back to the Internet.

The way we search for homes has changed because of the Internet too! Statistics may vary a few percentage points in these surveys but almost 90% of the general public begin their search for homes online, some as much as 18 months before they really start looking for homes. The Internet will offer all the information a Seller or Buyer could ever want or need. Because of the Internet, information will not be the end product desired by the client, the interpretation of the information will be how Realtors will service their clients.

For example, in the medical field, the technician takes the x-ray but the technician doesn’t interpret the information. The interpretation of the information is left to the trained eye of the doctor. In the Realtor world, it will not be the information that our client will desire because they can get that on the Internet. What they will want from us as Realtors will be the interpretation of the data. What does all this information about real estate mean and how can it be used to sell a home faster, find and purchase a home with real value? Information will not be what our clients want from us, it will be helping them to put all this information into a useable form that will benefit and bless their lives.

As I was writing this blog I was seated with my daughter and son-in-law watching Harry Potter and the Prisoner of Azkaban. My wife thought it looked funny for us to be seated to watch a great movie but all three of us were on computers and on the Internet searching for information, checking bank balances, and downloading images for use in a presentation. What better proof of the current and future power of the Internet than this?

This is a great site on the Internet for information about home sales and rental properties. Here is a great site to find homes and agents across the United States if you need to relocate. On the Internet, if you want specific information about buying real estate for use as part of your retirement plan, this site is great. If you want local information about lifestyles, local real estate values and trends in Northern Utah then try this blog as a good resource for market data. Pardon the personal ties to all of these websites.

Posted By: Steve Randall


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March 07, 2009

All Real Estate is Local-Northern Ogden

Posted to Steve Randall

You might be interested to know what happened to the house at 1275 N. Willard Peak Drive, in Ogden when the seller added a third bedroom. This is the house with great street appeal and a very comfortable floor plan and a few extra upgrades. It was listed at $172,000 and is now under contract for more than the listing price even in a buyer’s market. Miracles happened for both the buyer and the seller in this case. We had so many offers but one buyer loved it so much to pay a few extra dollars. That third bedroom was all that was needed to cement the transaction.

No matter what the media reports as national or regional trends, people are most interested in what is happening in their local neighborhood and city. The “All Real Estate is Local” section of this blog is intended to give you local market information. If you can’t find your city or want a specific neighborhood report, please contact me directly.

North Ogden Market Data as of today:

County Unit Sales Avg. Price Median Price New Listings Total Listings Months of Inventory DOM
No. Ogden 20 $184,056 $185,000 73 144 7.2 92
  • Unit Sales = # of units sold in the last 30 days
  • Average Price = The Average price of homes “sold” in this area
  • Median Price = is the midpoint between the lowest price home and the highest price home sold in the last 30 days
  • New Listings= the number of new homes listed in the last 30 days
  • Total Listing = the total number of homes listed in this area currently
  • Months of Inventory is based on the number of months it will take to sell current inventory based on the current sales rate. A balanced market of buyers and sellers is considered to be a number between 5 & 6. We are currently in a buyer’s market.
  • DOM is the average number of days it takes to sell a home in this area.

Here is the latest market data for the five most populated counties of Northern Utah as of the end of February, 2009.

Posted By: Steve Randall


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March 06, 2009

Five Mistakes New Home Buyers Make on the Internet

Posted to Steve Randall

One of the joys of riding my stationery bike in the morning is listening to the news. I always pump faster when I hear the latest news on real estate sales and new government spending. I don’t know what that really means but it always catches my attention and focuses my efforts. One of the blessings I have is working with first time buyers who are just at the start of the whole home buying process.

It used to be where home buyers would just work with the Seller’s agent. That has all changed in the last 10 years. Now, home buyers get to have their own agent, called a “Buyer’s Agent,” that looks out specifically for their interests. Specially, trained Buyers’ Agents work with new buyers to help make the buying process more enjoyable, and save the buyer time, money, and worry.

This home in Houston was purchased by one of our clients in Utah who needed to move. It was referred from our office in Ogden to our affiliate in Texas. The Buyer’s Rep took our clients to see many homes but ended up finding this perfect home in the Woodlands! The buyers love this house, the area, and all the wonderful weather. They also survived their first hurricane!

The buyers spent a lot of time on the Internet searching for homes but found that it really helped to use an ABR (Accredited Buyer Representative) to take them on tours and help them interpret the market data. We all start looking for homes on the Internet but we have to be careful to be sure we are understanding all the data that is now available. Here is USNews.com report on some pitfalls of relying on Internet searches only.

We love representing first time home buyers because there is so much excitement when they finally find the right home for them. We have a free Home Buyer’s Guide for all who are looking for a new home. It contains the following topics:

  1. Find a Qualified Buyers Representative
  2. Assess Your Credit and Finances
  3. Assess Your Wants and Needs
  4. Shop for a Home
  5. Negotiate Terms
  6. Obtain a Mortgage
  7. Prepare for the Close (Transfer Ownership)
  8. Close
  9. Move
  10. Celebrate

Please contact me directly to have one mailed to your home address.

Posted By: Steve Randall


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