Like careful consumers who are investigating any major purchase, St. Louis home buyers need to address some of the same basic queries. Among home buyers, those who already own St. Louis homes may think they have different questions than do first-timers, but even for those who have successfully navigated the process before, if it’s been a while since then, some basics may need refreshing:
1. Should I buy or rent? This is quite rightly the lead question any St. Louis home buyer needs to answer. It’s not one that many St. Louis residents who are already home owners spend a lot of time on since the answer for their own family has already been a “yes.” For them, unless some major changes have come to pass, they can safely assume that homeownership is still a no-brainer.
2. How do I get started? There are two good answers here: Get a mortgage pre-approval, and/or tap the services of a greate St. Louis Realtor®. Although a lender’s pre-approval isn’t a requirement, getting a green light in advance can’t help but create a positive atmosphere with sellers and their representatives. It demonstrates serious intent—and in a competitive situation could even wind up winning the day.
3. What’s the right credit score to buy a house? 620-650. Okay, okay—I know there’s actually no number that’s truly the “right” credit score for all circumstances. It depends on so many possible outside factors that the exceptions are too numerous to list. That 620 number (and higher) does seem to be one that lenders like to see; with 580 the common minimum low down payment FHA qualifier…but that can even be less in order to qualify for the FHA 10% down payment program. The only bullet-proof answer for the “right” credit score is—the best one you can build!
4. How much will the down payment be? This one depends on the St. Louis property you choose, the home loan you select—and also, to a degree, on how much you want to pay. It used to be common sense that you should pay as much as you can afford in order to minimize the amount of interest you wind up paying over the life of the home loan. But with interest rates as low as they are today, some financial gurus are less confident about that advice: there may be more lucrative ways cash can be put to work.
5. How much do I have to pay my agent? Nothing. The buyer’s agent fee is paid by the seller.
6. Should I use a real estate broker? This answer comes from the HUD.gov website: “Using a real estate broker is a very good idea.” As HUD says, “the details involved in home buying, particularly the financial ones, can be mind-boggling.”
Needless to say, that last Top Home Buyer FAQ is a personal favorite. It’s really just another way of saying, “call me!”
Posted by belsner under Mortgage
The legendary figure of The Wanderer has different connotations in different cultures. English teachers in St. Louis high school classrooms have always taught some of the most famous parts of Homer’s Odyssey—the heroic story of Ulysses, the most famous wanderer. Ulysses wandered in and out of a lot of trouble…
Planets are wanderers, too. During ancient night times, ancient shepherds looked up and watched them meandering restlessly among the stars, so they called them planets (“wanderers”). Dion (of Dion and the Belmonts) was the most celebrated wanderer of the 60s—at least his hit song claimed that he roamed “around around around around”).
In today’s St. Louis culture, though, wandering is a lot less glamorous than it’s been through most of history. A modern definition includes the bit about moving around, but most dictionaries include less-than-positive modifiers like “aimless” or “without plan or purpose.”
So when Federal Reserve Chair Janet Yellen gave a recent speech that St. Louis mortgage rate observers hoped would signal the direction where rates are headed, they expected clarity on the Fed’s plan and purpose. Last Thursday, The Washington Post headlined the following days’ financial reaction:
“Mortgage Rates Wander Higher but Remain Near Yearly Lows.”
When financial writers talk about mortgage rates that “wander,” it doesn’t really matter in which direction. It means that they’re going up and down in what amounts to wandering’s “aimless manner.” If it signals anything, it’s mainly that the signals from all corners are mixed. At Jackson Hole, Chair Yellen had signaled that the central bank “is moving closer” to raising their benchmark rate, but it seemed that the signal was not too convincing: Bankrate.com found that nearly 90% of the experts it talked to think rates will remain unchanged for a while.
As for how the Post could see rates “wandering” higher yet remaining near 2016 lows, it became clear in the paragraphs down below. The average 30-year mortgage rate had changed from 3.43% to 3.46%, remaining stuck in the range that’s lasted all summer (it’s been moving up and down no more than 7 hundredths of a percent). “Wandering” sounds appropriate. Freddie Mac’s Chief Economist said mortgage rates have been “hovering;” but “wandering” sounds at least as apt. What this means for St. Louis real estate is perhaps the only really clear signal to emerge. For the moment, St. Louis mortgage rates remain appetizingly low, keeping the residential market pegged at historical bargain basement levels.
Best of all, that means it’s still a great time to give me a call!
When last week’s surprising news (on the plus side) about consumer confidence was announced, it was one more sign St. Louis homeowners might have felt nudging them in the direction of putting their home on the market. U.S. confidence rose to an 11-month high in August—a turnaround from consumer blahs that had ruled during the first half of the year.
Even when there’s some time pressure to sell your St. Louis home, one snag that can stall the decision—especially for those with older homes—is the thought of the cost of bringing the place fully up to date. Even if the mechanicals (heating and cooling systems, plumbing and electrical) are actually in perfectly fine working order, it can seem as if potential buyers will be hard to convince that it’s the case. And if the appliances are veterans, even if they’re perfectly serviceable, potential sellers sometimes fear that prospects will shy away from the Great Unknown of costly dishwasher or clothes dryer breakdowns.
So it’s pretty good news that this is one concern that St. Louis homeowners and their future customers can do something about. The doubt-remover is a home warranty—the kind of policy that helps shield against the cost of unexpected breakdowns. Texas consumers can choose from a number of home warranty providers, each of whom offer varying levels of protection.
The home warranty companies provide a straightforward proposition: it is a service contract, usually a year in duration, that promises to pay if a major system or covered appliance should break down due to normal wear and tear. Some high-end policies offer complete coverage for repairs—or even full replacement if necessary. More inexpensive home warranties may provide less comprehensive coverage or require the use of specified repair services.
Once it’s been determined that the incremental cost is a worthwhile investment, it’s important to read through the previsions about what is covered—and to remember that systems and appliances have to be in good working order at the time the policy is issued. Some of the items commonly included can be the plumbing and electrical systems, furnaces and heating ducts, water heaters, pumps, dishwashers, garbage disposals, cooking appliances, refrigerators, washers and dryers—sometimes, even swimming pools. You can see why checking the scope of coverage is critical for determining the choice of contracts.
Lately, home warranties have grown in popularity—possibly because of timing considerations. H.U.D. says it’s because the protection they offer home buyers comes during the critical period immediately following purchase—a time when there is often less extra emergency cash on hand. That can be a critical reassuring factor for St. Louis home buyers.
Even more convincing are the statistics from the National Home Warranty Association. If it’s as true for Texas sellers as it is nationally, it’s eye-opening. The NHW finds that when a home warranty is provided as part of the sale, it can help a home sell up to 50% faster.
THIS could come as welcome news if you’ve been undecided about whether this fall will be an opportune time to sell. Even if you’re on the fence, give me a call!
Posted by belsner under Mortgage
Whenever you’re in the planning stages for your next St. Louis real estate venture, the best available St. Louis mortgage rate is a number you look for. Whether you are thinking of a purchase of a new St. Louis home or simply refinancing your existing property, that rate determines how much you will pay each month.
You would think that getting a good idea of what that number is should be pretty easy. Certainly you would be encouraged by what you find on the web. That number—the mortgage rate—is available online almost everywhere you turn. It’s in TV ads. It’s on the radio. It’s almost looking for you.
But as everyone soon learns, those numbers aren’t exactly the ones that you need. What appears in the ads and pop-ups isn’t necessarily that number (if by “that number” you mean the mortgage rate you will wind up paying).
This whole topic was addressed this last weekend by USA Today in an article that did a good job of explaining why the actual mortgage rate that most applicants will be offered is not readily available. The rates in the ads are called the “published” rates. Unlike many other kinds of consumer advertisements, in mortgage financial parlance, a “published” rate isn’t the same as a “promised” rate. As this month’s survey by Freddie Mac specified, the mortgage rate average of 3.45% was on average only available to customers who chose to pay an additional fee—in this case, .5 point of the loan amount. For a $275,000 loan, that would cost the borrower $1,375 up front to get the “published” mortgage loan rate.
That isn’t the only wrinkle. As USA Today put it, “Lenders also publish rates that have very specific prerequisites.” The rate may only apply to applicants with specific credit scores. The rate might call for a minimum loan-to-value percentage, too—or only be available in specific areas (which may or may not include St. Louis).
This might sound like a deliberate bait-and-switch tactic by the lenders, but when you get to the reasons for all the razmatazz, it’s actually necessary. St. Louis’s mortgage lenders are able to keep rates competitively low by only lending to borrowers who have a very good chance of repaying the loan. Those whose histories indicate that they pose a higher risk of not being able to keep up their monthly payments have to expect that they will be quoted a higher interest rate. The last time mortgage lenders stopped doing a good job of those risk calculations, it triggered what we now call “the great recession”—and just about everyone paid a price for that.
So it may be inconvenient, but in order to really find out what your true interest rate will be for a specific real estate transaction, you have to go through the motions of applying for it. In this age of readily available instant information, that can seem like a run-around—but it’s necessary. I’m here to make this and every other aspect of your St. Louis real estate doings as easy as possible. Call me!
If you are looking for the Town real estate agent who will do the best job for you, it’s logical to seek the best agent. Less obvious is what traits distinguish the best real estate agents. If you look through summaries of commonly agreed-upon qualities, most are the same as for other successful people. A common #1 listed trait is “a problem-solver mindset”—but that would be true for most top producers in any number of occupations.
Going at it from a different perspective, the nature of the industry might make the most useful distinguishing characteristics largely personal ones. From my own point of view, four are all but indispensable:
The best agents are nice. The selling and buying of a home is serious business, so “nice” might not seem to be required…but even a hint of rancor is a bar to success. In dealing with the place that sellers call home (and buyers would like to call home), when ill will threatens to sour the atmosphere, it can thwart a transaction—even when all other factors are favorable. Although it may not sound logical, the ‘vibe’ surrounding a home’s sale can become as important as it is in establishing a business partnership, where good will is justifiably essential for success. Especially when nerves are ragged, misunderstandings are easily triggered. The best St. Louis agents adroitly handle nuances (like knowing how to prevent minor critical comments from being taken as personal slights).
They’re organized. The sheer volume of details that flood a busy real estate agent’s day has to be experienced to be believed. The best agents can’t be “snowed under,” because they have long ago figured out how to systematize fielding the daily load. You can tell an organized agent by their swift personal response to phone messages and email contacts.
They’re real. Eventually, artificiality wears thin. Sooner or later, a professional demeanor that’s out of phase with the same person’s private side betrays itself as what it is: a guise behind which reality resides. The best agents know that the strongest cooperative relationships are built on trust. Whenever an unexpected obstacle enters the picture—and in the search, negotiations, and completion of the sale of a residence in St. Louis, it’s surprising if at least some snags don’t pop up. The opposite of artificial cheer is authenticity; when the voice on the other end of the phone is unfalteringly bright and energetic, it’s that much easier to make steady progress. It’s why a truism about the best agents is seldom disputed: they all seem to have one personality trait in common—a sunny disposition. That comes from loving to do what you’re doing!
The best agents don’t fear confrontation. It’s built into the mix: the interests of buyers and sellers are often diametrically opposed. That isn’t to say that, after a fair deal has been struck, both can’t walk away with good feelings about the transaction and one another (in fact, that’s often the ultimate outcome). But to get there, each should feel that their conflicting interests are being protected. Strongly protected. The best agents don’t shy away from energetically representing the wishes of their clients, even if that places them outside their preferred comfort zone.
Real estate calls for a special combination of personality traits. Salesmanship needs to be tempered with diplomacy. Zeal with patience. And above all, the best St. Louis real estate agents love doing what we do. I hope you’ll give me a chance to demonstrate: just give me a call!
Posted by belsner under Advice
It’s not a coincidence that the same word is used in both dramatic undertakings and St. Louis residential real estate preparation. Both describe preparations that seek to establish a feeling within the beholder. Of course, staging for St. Louis home showings differs fundamentally from its theatrical homonym. With our kind of staging, the presentation is real—not make-believe.
That’s not to say we can’t borrow an idea or two from the theater. Some stage directors begin first rehearsals by encouraging the actors to overdo their readings; to “make it big—really big!” The idea is that later on, after they’ve rehearsed the same scene dozens of times, it will be harder to think creatively about interpreting their characters. There will be plenty of time to tone down wildly overdone acting, but after many days of rehearsing, overfamiliarity with the play will make it harder to come up with creative ideas to improve performances.
There can be some value in applying the same kind of thinking when you approach the staging of your St. Louis home—at least in the sense of thinking outside the box. One way St. Louis’s staging professionals have the advantage over homeowners who do it themselves is that they arrive on the scene without preconceptions. They get to see a home with fresh eyes. That’s pretty much impossible for someone who has lived in the place for years. The pros have also developed a good deal of expertise in imagining basics, like how the placement of furniture can improve the “flow” of a home: how visitors naturally move from room to room.
When actors perform that first rehearsal, making their reading “bigger” than it will wind up being on opening night, there is an apt analogy for staging a home.
It’s about the all-important staging rudiment: the de-cluttering.
Essentially, the ideal would be to clear everything out.
Of course, unless it’s a pack-up-and-move situation, that’s usually not practical. But what can be accomplished is to progress through the house, room by room, slightly overdoing the de-cluttering. Walking through a living room that you’ve made comfortable through the years, it is really hard to think of doing much other than clearing surfaces or rearranging an item or two. But when you evacuate almost everything from a space (which is possible if you’re only moving it into an adjoining room), it’s suddenly easy to see what really needs to be moved back. And new ideas pop up for where lamps, tables, chairs might be more appealingly placed…and most important, which things aren’t really necessary at all!
Come opening night (that is, the first showing or the first open house), the results from a serious home staging effort can often earn the kind of critical results that translate into a “sold” sign in the front yard.
For more ideas that can speed your St. Louis property’s move into the sold column, I hope you’ll give me a call!
Posted by belsner under blog
It was tucked away in a backwater of The Wall Street Journal’s online Design tab, which is actually just a sub-section of their Real Estate section. “The Rise of the Colorful Bathroom” was like a conceptual hand grenade tossed into the placid lagoon of home decor orthodoxy.
As far as design insights likely to affect St. Louis’s home resale market, the pointers found in Design lately haven’t been particularly noteworthy. Earlier this month, there had been a piece about metal versions of “The Classic Peacock Chair.” That might have had some impact in Rangoon, but here in St. Louis, where peacock chairs are few and far in between, it scarcely ruffled a feather. Similarly, there had appeared “A Décor Lesson in Subtle Patriotism” with marginally subtle red, white and blue illustrations—but especially since it first appeared after the July 4th weekend, St. Louis readers were unlikely to run that one up the flagpole…
But now, tucked away beside a Most Popular Videos sidebar, came this subversive “Rise of the Colorful Bathroom.” A generous illustration showed an example of how far the author was willing to go: it portrayed a stark blue bathroom wall and sink featuring clapboard-like blue-and-gray porcelain tiles: the blue plank special. Did this mark a warning shot over the bow of one of the longest unchallenged home décor conventions—that the American bathroom palette should be, in the author’s phrase, “compulsively neutral”?
If so, would the new trend force homeowners poised to enter St. Louis’s home resale market to have to expensively retool their bathrooms’ calming hues?
Fortunately for the budgets of St. Louis home sellers, a close reading made that unlikely. Although the National Kitchen and Bath Association (NKBA) does report some tip-toeing by their members in the direction of bathroom color infusions, no more than 10%-15% of them actually expect to decorate more baths “in green, blue and black”—at least for this year. There were also tacit admissions that the Rise of the Colorful Bathroom might become somewhat diluted before it spreads much further. “Muted beats candy bright” was the caption describing a mid-toned bathroom, displaying an almost traditional “quiet, palatable personality.”
Some designers also expressed some reluctance to jump on the Colorful Bathroom train—at least in one part of the rainbow. Palm Springs designer Christopher Kennedy may opt for small touches of bright color, but will always “avoid pea greens and acid greens” because “they aren’t so great on the skin.” He goes in a rosier direction, with hip colors like blush “because it makes you look beautiful.”
As far as St. Louis home resale prospects are concerned, one devil-may-care subhead gives away a quite possible impact. The truly cool blues to emphatic blacks are labelled “resale-be-damned” colors. As we near the end of the hectic peak selling period, most St. Louis sellers are continuing to choose much more of a “resale-be-welcomed” disposition. If that describes your own stance, you’ll find it echoed when you give me a call!
The “5-Year Rule” as it applies to St. Louis homes listed for sale is a pretty good one, as far as real estate rules-of-thumb go. It’s part of the family of truisms that have been around long enough that you’d figure they have to be reliable—like the rule that you should plan on maintenance costing 1% of a listed home’s selling price per year; or the one the government often quotes that housing costs should be no more than 30% of income.
The 5-Year Rule has it that if you don’t know you will remain in a new home for at least 5 years, you’d be better off not buying. The reasons are the oft-cited dollars and cents issues. In addition to the closing costs, commissions, and costs of moving your household, emotional issues are often cited: as in the familiar “moving is one of the most stressful events in life.”
But like most other similar guidelines, the 5-Year Rule is useful as a starting point only. If you have no overriding issues that have set you to checking out the homes listed in St. Louis, it’s a reasonable starting point. But if other factors are nudging you into action, it’s only one way to look at the practicality of buying a home—not the final verdict. Some outside factors that might make it worth at least considering overruling the 5-Year Rule:
One of the homes listed is a perfect fit AND a genuine steal. When you come across a property that is exactly what you have been looking for and the asking price is clearly below what comparable St. Louis homes are currently commanding at market, it might make sense to reconsider the 5-Year Rule. The reason is simple: if you have to move, you have reason to believe that you will be able to sell at a price that offsets the costs of the transactions.
The emotional cost of not owning your home is substantial. This is easily overlooked, but for some people (often, for those whose entire childhood was centered in one home) the feeling of being untethered—or of delaying the familial commitment that accompanies the institution of homeownership—can be emotionally disruptive. It’s impossible to put a price on this, but it can make a real difference in well-being.
Knowing what you don’t know. The 5-Year Rule is based upon a certainty: that you will be moving away from St. Louis in at most 5 years. But what if there is less certainty? What if you simply don’t know? This is a fairly common 21st century conundrum, and it can lead to paralysis in any number of decision-making situations. Especially right now, when the homes listed in St. Louis are qualifying for today’s incredibly low mortgage interest rates, it may be worthwhile to pencil in the cash flow tradeoff versus the renting alternative. If you still don’t know 5 years from now, that same tradeoff might look a lot less worth doing!
When the 5-Year Rule isn’t at issue (or if it might give way to one of the overriding factors), you want to be sure you are being shown the listed St. Louis homes that offer the best value in your price range. That’s where I will be certain to be your strongest asset. Call me!
Once you have decided to sell your St. Louis home, one of your first action items is to recruit a top sales team. About 90% of sellers choose a licensed Realtor® to head up their effort—not just because it’s the popular thing to do, but because the alternatives are few. You could recruit a business person from some other discipline, but few do that. Most in the minority group decide to do it all themselves—to go the FSBO route: “For Sale By Owner.”
The reason for settling on this choice is usually a dollars and cents one: to eliminate the real estate commissions. Any home sale in St. Louis is a weighty transaction—so pocketing that percentage looks like a businesslike decision. It usually does have financial ramifications, but not necessarily the kind that the Town FSBO seller was hoping for:
1. Statistics tell us that fewer than 3% of home buyers hear about their ultimate purchase directly from the seller. Missing out on 97% of prospective buyers greatly diminishes the chance that more than one party will compete to buy the property.
2. The longer a property lingers on the market, the lower its ultimate selling price is likely to be. Interviews confirm that only 1 in 8 FSBO sellers succeed in selling within their planned length of time…
3. …and even fewer “get what they consider the right price.”
4. Advertising expenses have to be paid by the seller. There is $5.95 for a front yard FSBO sign, plus $2.35 for the wooden stake that holds the sign up. If no additional advertising expenses are incurred, it means there is no advertising—with likely outcomes described in 1, 2, and 3.
5. If the St. Louis FSBO seller has regular job responsibilities, the time devoted to handling prospects and addressing the business and legal ramifications that accompany a residential real estate transaction can become costly distractions. High among the tasks past FSBO sellers rated most difficult was “understanding and performing the paperwork.”
6. The average price of a FSBO sale is 75% of one carried out by a professional.
7. Even if a sale is accomplished, the premium gained may be less than anticipated. Since the buyer is likely to be represented by a buyer’s agent, the hoped-for savings are cut in half.
A financial result—the usual reason for most St. Louis FSBOs—often comes to pass, but it’s the opposite of the one intended. You might say that the FSBO strategy should really only be attempted by those for whom money is no object. In effect, FSBOs are the champagne of real estate strategies…
I’m only half kidding about that last—but not kidding at all when I suggest that you give me a call when it’s time to sell your own St. Louis property!
When the name “Deloitte” is attached to futuristic predictions about any kind of industrial matters, most St. Louis readers grow less skeptical than would otherwise be the case. After all, Deloitte’s quarter-million financial services professionals earn their keep by accurately advising enterprises worldwide on which way the commercial wind is going to be blowing five, ten, or 20 years hence. The folks in charge of the worldwide enterprises are keen that their capital expenditure planning won’t look stupid five, ten, or 20 years hence.
So when a Deloitte Center for Financial Services blog describes the excitement a typical child will display when, in 2030, he’s about to “take his first trip to the moon”—well, that’s a blog that’s bound to get any St. Louis readers’ attention. It got mine because it’s contained in a blog about the future of real estate and housing.
The housing in question will be on the moon. Just 14 years from now.
The basis for this science-fictiony scenario is the European Space Agency’s plan for constructing a “moon village” on the lunar surface beginning in the 2020s. Since it’s extremely unlikely that anyone—Europeans or Americans or Asians or anyone else—will be able to ship construction crews up there on short notice, the first rhetorical question Deloitte poses is, “But who will build all this?” If Deloitte is right, the answer could well become a major factor in the future of St. Louis’s housing industry. Perhaps the major factor.
The European Space Agency plans to use robotic 3D printers.
Here it might be useful to again review the whole 3D printer thing. My own opinion is that 3D printers are called “printers” just to get our attention. Everyone knows that what traditional printers print is decidedly two-dimensional. Technically, the thickness of ink and paper may constitute three dimensions—but they’re more flat than not. So “printing” a gun or spare auto part used to be preposterous, until inventors figured out how to spray jets of successive layers of stuff on top of each other to create fully dimensional objects.
That’s 3D printing, and it’s how the housing on the moon can be done by robots. A footnote in the Deloitte blog points to the TechTimes website, which spells out the details. First revealed in a conference of 200 scientists in the Netherlands, the timeline is aggressive. “As planned, robots will arrive on the moon first to allow for human explorers to land later…”
The “stuff” the base will be built from is moon dirt (called “regolith”). They are already testing 3D printers able to produce 6.5 feet to 11 feet of material in one hour. According to the ESA’s director general, at that rate, “the entire settlement can be produced in just one week.” By the robots.
You can see why having Deloitte verify that this whole thing isn’t just an internet practical joke is an important part of the story. Because if the moon robots can build a settlement on the moon in “just one week,” what about settlements in St. Louis? What about housing…and strip malls? Isn’t St. Louis’s regolith at least as high quality as the moon’s?
If this out-of-this-world planning has even one foot in reality, the major implications for the future of St. Louis housing and construction are worth pondering. Perhaps later. For the moment, though, we have a great selection of non-robotically built, regolith-free St. Louis properties. Call me for the down-to-earth details!