Home Styles and Fashion Collide

I was reading an interesting article in October’s issue of Old House Journal about various styles of homes that have been introduced over the past century. I thought it was interesting that you can often tell when a home was built just by looking at it’s main design. I'm not sure this is true today.

Century of Home Styles
At the turn of the century we had grand Victorian homes followed by the simpler Bungalows or quaint Tudors. In the wartime 1940’s we built lots of bare-bones matchbox homes in subdivisions and later graduated to the knotty pine and vibrant tile bathrooms of the 1960’s.

Things went cheap again in the 1980’s as quality was replaced with quantity evidenced by streets of new homes filled with carpet & vinyl. Homes just got bigger in the 1990’s as the McMansion’s became popular.

Now- Mix and Match
So what about today? I won’t go into all the new building materials and techniques that have become less expensive and longer-lasting, but as far as style, it’s a pluralistic time where many different styles are very popular.

For example, there are brand new subdivisions filled with Craftsman-styled homes and others that are completely contemporary. Still, there are others built for economy that are still filled with carpet and vinyl.

My Fashion Sense
The clothing fashions these days seem to be following this trend. I not really into cutting-edge style, but I have noticed that there are many different trends that have made a comeback, from the thick-rimmed glasses to the colorful dresses from the 1960’s.

The point is that we all have individual tastes and needs. We’re living in a time where this individuality is celebrated. It’s become cool to be unique. Whether it’s your home or your jeans. People want to have their own style.

When it comes to homes, I think this is great. I’ve always loved variety and I enjoy having clients looking for a Bungalow in East Nashville and others looking for a modern condo in Germantown.

When looking for a home you first should consider the needs you have for space and function. After that, there is a wide range of options depending on which neighborhoods you prefer and how much you can afford.

Whether you prefer to tight-roll your jeans or cut them full of holes, there’s a house for you!

-Peter

www.NashvilleCityHomes.com

'Collapse' of Home Values?

I heard a news report the other day that mentioned how people are afraid because of the ‘collapse’ of home values. I thought about this for a moment, but honestly, our home values have NOT collapsed, especially here in the Nashville area.

I guess we have to begin by defining what a collapse would be. I’m not sure I want to think about that, but through 2007 most areas around Nashville were still seeing home prices increase. It’s only been in the past few months that prices have actually decreased.

I’ve noticed the recent change because before the market shifted we would value properties based on the recent sales in the neighborhood. Now, it’s more accurate to look at what’s currently for sale and price the home competitively because prices have generally decreased since those homes sold 3-6 months ago.

So, I admit that prices are less in Nashville, but we’re talking about a few percentage points- nothing like a ‘collapse’. The people that are experiencing the most pain are those who bought at the top of the market and are now faced with a need to sell. It’s similar to those who invested in the stock market when the Dow was 14000 and are now selling.

However, you don’t actually lose money in the market until you sell. If you bought at the top of the market, hang on to that investment. Don’t buy high and sell low if you can help it.

The market will come back. I’m not sure when, but historically it always does. It also always goes up much more than it comes down. If you see your home as a long-term investment, you’ll be fine.

Okay, so there’s no collapse. I’m glad we cleared that up.

-Peter

P.S. Another myth is that the supply of homes is way up. Not true for single family homes. Read more here.

www.NashvilleCityHomes.com

Get Your Pumpkins In Inglewood

It'’s that time of the year when the air gets cooler and leaves start piling in my yard. It’s also about the time my wife pulls out all the cinnamon candles and we start thinking about the holidays. With three kids under 4 years old, getting pumpkins has become a yearly outing.

Last year we went to a huge pumpkin farm south of Franklin that had a petting zoo and lots of kid’s activities. It was great fun, but this year we wanted to stay closer to home.

We found a great place over at Dalewood United Methodist Church in Inglewood near the intersection of Stratford and McGavock. My kids ran all over the place and we got some nice pictures. The church gets their pumpkins from a Navaho tribe in New Mexico, supposedly the “best in Nashville”.

I’m not sure my kids care that much, but they do look like nice pumpkins. I mean, most of them were round and orange…

They’re only available for a couple of weeks so go check them out!

-Peter

www.NashvilleCityHomes.com

Less Homes on Market Than Last Year?

I saw some interesting stats today. The Greater Nashville Association of Realtors (GNAR), reports that 15,053 residential properties for sale at the end of September 2008, compared to 15,438 at the same time last year. So there are actually less homes for sale this year. (This figure doesn't include condos or multi-family.)

This really surprised me because homes are taking longer to sell. GNAR also reports that around 250 less homes sold in September 2008 compared to a year ago.

The major increases in inventory have been in the farms/land/lots category where there are 38% more to choose from this year. Generally, more inventory (or supply) means that prices fall due to overstock.

So what does this mean? Why are things taking longer to sell, but yet the inventory isn’t piling up? Here’s my opinion: people that don’t have to sell, aren’t. Instead of leaving their homes on the market or dropping the prices to get them sold, people are just waiting. It seems that the majority of homes for sale out there today are owned by sellers that have to sell them- banks, developers, builders and people relocating or facing foreclosure.

The difficulty in this ‘buyers’ market is that many buyers are waiting too! They are watching the news and scared to make any moves that might put them at risk. I tend to believe that there is quite a bit of pent-up demand out there- people that would really prefer to buy or sell but are waiting for one reason or another.

The housing market tends to move slowly compared to the yo-yo stock market. It’s often hard to know what’s going on until it’s behind us. Once confidence is restored and people feel like there is some solid ground to stand on, I think they’ll jump off the fence they are waiting on.

Thinking about jumping? Give me a call! :)
-Peter

www.NashvilleCityHomes.com

Walden Open For Business in East Nashville

I got a chance to see some of the condos in the new Walden Development the other day and I was quite impressed. They advertise it as a 'true mixed-use' development and that's what makes it so cool. They are building a live/work community and already have the requisite coffeeshop, Ugly Mugs Coffee and Tea, and the Fresh Blends Smoothie and Juice Bar with more to come.

Walden is located on Eastland Avenue at Chapel Ave between the Lockeland Springs and Eastwood Neighborhoods. There is a main entrance for business patrons, but condo residents will like the more private second entrance which allows you to park a few steps from your front door on the back of the building. Even though they are on the second floor, there isn't an long flight of steps to get to your unit.

Having seen many of the condo projects around town, this one will really appeal to someone wanting to live in a pedestrian friendly neighborhood, close to restaurants like the Rosepepper or Eastland Cafe and still be only a few minutes from downtown, universities or music row.

The units themselves are high-quality with polished concrete floors, high-end quartz countertops and designer everything. It's not like some of the other condos around town that might have a great location, but the cabinets are low-grade. These are consistent from the impressive glass-tiled backsplashes to the marble topped vanities.

The prices start at $184,900 for a 712 sq. ft. 1 bedroom to the incredible corner residence above the coffeeshop with 1518 sq. ft. and 2 bedrooms for $339,900.

East Nashville has made some major progress over the past 5-10 years, but with projects like this and Martin Corner underway, it appears that things are just beginning for this growing neighborhood. March Egerton, the developer for Walden, has many more plans for the site, beginning with the adjacent building that may soon be overhauled to become home to more commercial space.

If you are looking for your place in Nashville give me a call.

-Peter

www.NashvilleCityHomes.com

Funny Way to Sell A Home

I saw this picture yesterday on a new listing and just had to share it. It made me laugh out loud:

The caption:

"Iron bars on windows for safety, and they also look great!"

I'm not sure I know anyone who truly appreciates the beauty of iron bars covering your windows. It seems that most people overlook this simple improvement that could make your home more secure as well as beautiful and attractive... :)

-Peter

www.NashvilleCityHomes.com

What are They Doin’ With My Money Now?

The government is trying to come up with some kind of plan to rescue (or bail out) failing mortgage banks and investment firms with billions of dollars of taxpayer's money.

I hesitate to write this because I’m neither an economist nor a politician, however, the banking problems on Wall Street are on everyone’s minds and there is a lot of confusion and misunderstanding. I’ve been trying to read up on it because, as a Realtor, I’m expected to know what’s going on, right? I try… The news is changing so rapidly right now that it’s hard to keep up. Let me give a couple views of what’s happening…

BACKGROUND
Throughout the ‘good times’ of the last decade there were a couple trends going on. It became politically correct to encourage broader home ownership. The Community Reinvestment Act was revised in 1995 to require Fannie Mae & Freddie Mac to devote a percentage of their lending to support affordable housing. In effect, these new rules loosened loan qualifications to allow more people to become homeowners. This was supported by nearly everyone involved because it meant that more homes were selling, more loans were made, and more people were buying homes. It worked as long as home prices continued to rise.

Once housing markets began to slow down and prices started to fall, many of these homes were no longer worth what was owed for them. If the homeowners didn’t keep paying, then the banks were stuck with homes that they could not sell. What was an asset became a liability.

The core of a bank’s business is loaning money, and when their assets are worthless, their ability to loan funds is gone. Therefore, some of these banks are failing. When this happens in large numbers, the government gets very nervous and wants to do something.

BAILOUT TIME?
So, Congress is trying to come up with a plan. The most recent proposal was a $700 Billion ‘bail out’ that would buy up these ‘assets’ that the banks cannot sell to anyone else. This is the core purpose- to take these lousy home loans off of lender’s books. The loans are no longer liquid and no one knows what they are really worth.

Some people are saying that the government could make a profit down the road by buying up these assets and selling them later. This is a possibility, but there aren’t many people that would say that we want the government investing our tax dollars in this. The real goal of the bail out is to stabilize the financial ‘crisis’ so that consumer confidence can be restored- a key factor in the recovery of the housing market or stock market.

If the government does buy these questionable mortgages, it is likely that they will also initiate some kind of ‘work out’ plan to help reduce the number of foreclosures and get homeowners set up with payments that they can afford. After doing this, they hope that the number of mortgages headed toward default would decrease.

ANOTHER VIEW
Some economists say that the banks should be allowed to file bankruptcy. Jeffrey A. Miron, writing for CNN, shares this point of view. He writes, “Bankruptcy does not mean that the company disappears; it is just owned by someone new (as has occurred with several airlines). Bankruptcy punishes those who took excessive risks while preserving those aspects of a business that remains profitable.”

Miron also calls the talk about the economy collapsing “ridiculous scare-mongering”. He contends that if these ailing banks go under, then some other company will step up to make the loans as long as there is profit to be made.

FEAR DRIVING DECISIONS
Dave Ramsey, personal finance guru and syndicated talk show host, has his own plan that he’s calling the “Common Sense Fix”. He says that fear is driving a lot of decision-making going on and this is only heightened because of the election and current political climate.

Ramsey’s one page plan includes three things: 1. Provide government-backed insurance for sub-prime mortgages (with strings attached to help restructure delinquent loans), 2. Change the Mark to Market accounting rules and 3. Remove the capital gains tax completely- flooding the market with investor funds, not taxpayer dollars.

It’s clear that there is a lot of fear out there. It appears that our financial systems were built on shaky ground, which is a good reason to be a little skeptical right now. Who do we trust in a time when everyone seems to have political motives or a company to save? Can the same people that guided us into the mess now fix it?

CLEANING HOUSE
Hopefully, the net result of this complex situation is that we do find a solid footing for our markets and restoration of our confidence. Whenever you clean house, it usually gets messy before things get organized again. That may be what we’re experiencing right now.

-Peter

www.NashvilleCityHomes.com

Nashville- One of Ten Least Expensive for Home Ownership

A recent article by Forbes has given us the ten least expensive places to own a home with Nashville in sixth place. Cleveland was the cheapest in their report, but it lacks our Southern charm and the Bluebird Cafe, right? :)

Most of their analysis on why cities are more expensive is based on amount of land that the city is confined to. Expensive places like San Fransisco and New York are geographically trapped so their home costs continue to rise. In Nashville, prices have risen, for the most part, but there is plenty of land around the city to expand to, and we are.

If you've been to any of the surrounding counties around Nashville then you've seen this expansion. Whether it's Murfreesboro, Hendersonville, Franklin, Lebanon, or even Dickson, there are new subdivisions and major shopping developments going in everywhere. The controversial new interstate 840 connects many of these outlying areas. (New interstates are always controversial, aren't they? Who votes to build one through your neighborhood?)

All this is happening while downtown is also seeing more demand. I'm amazed how the skyline has changed just in the past few years as new condo residences have come to Midtown, SoBro and the Gulch, as well as all the nearby historic neighborhoods are being overhauled with lots of home renovations and new commercial districts. Most notable are popular areas like Germantown and East Nashville.

I'm glad that we can have such a vibrant city to call home and it's also one of the most affordable in the nation. Like any market we have our ups and downs, but the trend is a healthy upward one with lots of exciting new things to look forward to and enjoy along the way.

-Peter

www.NashvilleCityHomes.com

Update on 800 Main in East Nashville

In May, I shared some news about a couple developments coming to the Main Street corridor in East Nashville. I recently heard an exciting update regarding the 800 Main development which may be a major step toward revitalizing this stretch of Main Street that leads into East Nashville.

The plans for 800 Main will replace the current Bank of America building with new structure containing 25,000 square feet of retail space on the first floor, with around 330 rental units in the top three floors.

Many of the units, ranging from 1 to 2 bedrooms, will border small courtyards in the all brick building made to complement the historic roots of the neighborhood. The Tennessean reports that they are hoping to break ground next spring and finish by Summer 2010.

The Nashville Business Journal expects rents to range from $830 to $1800 per month. Not exactly cheap, but there is a rooftop pool and clubhouse included, as well as off-street parking.

Another exciting part of this project is that they may actually get it done. The main developer, Double A Development, completed the District Lofts in Germantown earlier this year. Their partner, Lane Company was part of the huge project in Atlanta called Atlantic Station.

-Peter

www.NashvilleCityHomes.com

Doral Country Condos- Affordable West Nashville

West Nashville is in high demand these days. Overall, it’s the priciest part of town, though there are sections that are more affordable. Bellevue is one of these pockets, but even within Bellevue, single family homes tend to start in the $170k’s and go up from there. If you don’t have that much to spend, you might check out the Doral Country Condos.

I got to know the Doral Country development over the past few weeks as I had a client purchase one last month. For a little more than $100k she got a 2 bedroom, 2 bath condo that was in great shape after some deep cleaning. There are several currently listed between $110-140 in varying condition and size. There’s even a HUD home for sale at $89k, which is a great price for West Nashville.

The Doral Country Condos are off Bellevue Rd, just south of Highway 70S near the Bellevue Center Mall. The development is a little older, built in the late 70’s, but they have an active homeowner’s association that keeps them in great shape. Most of them have just been repainted and received a new roof.

The people I met throughout the neighborhood were incredible and very helpful. My client’s neighbor even came over to help her install a dishwasher. Many of the neighbors have been here for a very long time with no plans to move.

One other nice thing about these units is that they are all attached to only one neighbor. No residents above or below you, only on one side. They each have their own off-street parking pad and a patio in the back. Some of the patios have privacy fences, which makes a great space for grilling and outdoor living.

There’s a pool and tennis court if you want to stay active outside and the homeowner’s association fees are around $190 per month. This includes all the yard maintenance and the exterior of your unit as well as upkeep of the pool/tennis courts. So, if your roof leaks it’s not your problem, you call the HOA. If you like grass, but want someone else to mow it, this might be the place for you.

Someone looking for his or her first home, or a great community to downsize to, might want to check out this development. It’s hard to beat it for the money in West Nashville.

-Peter

www.NashvilleCityHomes.com

Who Cares About Staging and Curb Appeal??

Answer: You should if you are selling a home today.

A buyer’s market is a staging market. Buyers are picky and looking for value. Staging helps set a home apart and make it look more 'valuable'.

Staging is the process of de-cluttering your home and showing off the home in the best possible way in order to maximize the sales price. Loads of research show that it works and will actually help you sell for more money!

STAGING BEGINS AT THE STREET
Curb appeal is a big deal. It's the first impression that a buyer has of your home. The entire purpose of improving the curb appeal is to get a prospective buyer inside the home. If the front of the home is in bad shape and needs work then you’ve got a problem. People will skip it!

In home buying, people tend to judge a book by its cover, meaning if the front is unappealing, then they assume that the inside is just as bad. They may never get to see your completely renovated kitchen, because there is no landscaping and the sidewalk needs repair. They’ll move on to the next home down the street.

POLISH THE ENTRYWAY
Whenever a Realtor is showing your home they will pause for a minute at the front door to get the key out of the lockbox. While they are waiting, buyers will take a good look at the entryway. Make sure it gets some attention whether it’s a fresh coat of paint or repairing a loose handrail. Of course, don’t forget the welcome mat!

From there, think about the buyer’s experience and spend your time accordingly. De-clutter the entire home and start packing now. Think of your home like a nice hotel suite or a model home. Put away the family pictures and clean out the closets. Dust everything and change the air filters. You may even need to get a storage unit to get the stuff out of the house. (Yes, it’s that important!)

The kitchen and baths are usually most important so make sure they shine. Do some deep cleaning and clear off the countertops. Caulk the bathtub and buy a fresh shower curtain. Remove any odors that may be offensive, especially smoke and pet odors.

The idea is to lead a buyer through a home letting them imagine themselves living there, with nothing distracting to break the ‘spell’. If you can get a buyer ‘emotionally attached’ then you home will be sold!

I started by saying that a buyers market is a staging market. To get your home sold it MUST stand apart from the competition. Pricing your home is all about location and condition. We can’t change the location, but anything that you can do to improve the condition may be the difference between selling and not.

-Peter

www.NashvilleCityHomes.com

Discover Nashville's Farmers Market

Since the early 1800's the Nashville Farmers Market has been a source of a variety of fresh foods, much of it grown locally and picked just days ago. If you are into food, and most people are, then you might want to check this place out.

My family made the trip out there last weekend. I've got three kids and they all seemed to enjoy exploring the aisles of different veggies like cucumbers, squash, corn and melons. We had to watch our budget because it all looked so good!

The market is divided into three parts. The north end contains a flea market section, the center is called the Market House and on the south side are the farm sheds. It's quite a place, especially this time of year when so much food is in season.

If you are looking for prepared food, then you have to visit the Market House with it's many specialized vendors. The variety continues ranging from Southern fried chicken or bar-b-que to po'boys, gyros and Jamaican jerk chicken.

The attraction of the Farmer's Market, especially in a day where more people are preferring organic or locally grown food, is widespread. It has become a main selling point for nearby Germantown, Hope Gardens, Buena Vista or other North Nashville neighborhoods that border the market as well as adjacent Bicentennial Park.

Growing up on a produce farm, I have my own memories of picking sweet corn and strawberries each summer. Much has changed since then, but there's still nothing quite like some fresh food straight from the farm.

-Peter

www.NashvilleCityHomes.com

Inspection Contingencies 101

For home buyers, the inspection is the time when you look deep into a home's 'eyes' and see if you want to go further in the relationship. For Sellers, it's often full of anxiety, wondering what problems lurk around their home, or how 'alarmist' the home inspector will be. Standard real estate contracts all have 'inspection contingencies' these days, let's take a closer look at this section of the contract.

First, remember that everything is negotiable up front. Typically, sellers expect there to be an inspection, so this isn't usually a point of contention. Buyers will ask for a certain length of time to perform all inspections and let the sellers know their response. If they've asked for a 10 day inspection period, then the buyer's have 10 days to do the home inspection and any follow up inspections such as getting a mold report or a contractor's estimate for things that came up.

When they are ready to respond, the buyer has three options:
1. OPTION 1: Terminate the Contract- I always include this option for my buyers because I'd hate for them to get stuck if the inspection is terrible. The buyers will get their earnest money back and head off to look for another home.

2. OPTION 2: Accept the Home "AS-IS"- This is the desired outcome. It's always nice when there are no inspection surprises and the buyer can happily move forward. With most of the bank-owned properties, this will be your main choice unless you want to terminate. Banks are not interested in doing any repairs whatsoever.

3. OPTION 3: Renegotiate /Ask for Repairs- The usual contract offers this option where the buyer can send a list of requested repairs to the Seller. If the cost of the repairs is above the previously agreed upon repair costs, if there were any, then it's time to renegotiate. Depending on the nature of the work to be done and other circumstances, we can negotiate not only repairs to be done, but perhaps ask the seller to pay closing costs "in lieu of repairs" or even reduce the sales price. It all hinges upon how important it is to the buyer and how motivated the seller is to sell. Things can get messy at this point, but we are usually able to find an agreeable solution.

This is just a simple overview. Inspections and negotiations can get complex sometimes. I always try to help my clients understand what's going on each step of the way. Once we get past the inspections, the focus is on getting the transaction closed and keeping things on track.

My advice: Don't skip the inspection. You always want to know what you don't know about the home you are purchasing.

-Peter

www.NashvilleCityHomes.com

How Much Will I Make Selling My Home?

One of the trickiest parts of my job is to help a seller understand how much money they’ll make at the closing. We call this the Seller’s Net Sheet. It’s tricky to come up with because I’m not a closing attorney, and it’s difficult to nail down all those pesky fees ahead of time. However, this tool is very helpful in comparing various offers and helping the seller get a grip on how the monies were disbursed. Let’s take a closer look…

In putting together a Seller’s Net Sheet we start with the Purchase Price. This is sometimes called the “Gross” Sales Price. Next we subtract all the items that the Seller has to pay for at closing. Here are some of the more common ones:

Commissions- The Realtor's commissions are negotiated at the time of listing and is usually a percentage of the Gross Sales Price. Part of the amount, usually half, goes to the listing agent and the rest is paid to the buyer’s agent.

Title Search/Policy- For each transaction, a title search is performed to ensure that the title if free of defects. If the title search is satisfactory, a title policy is issued to protect the buyer against future issues that may arise with the title to the property. The cost of this is based on the purchase price. For a $150,000 property, the title insurance will cost around $800. This varies so when I’m doing a net sheet I just call the title company to get the amount from them.

Buyer’s Closing Costs- It is quite common these days for the Buyer’s to ask for the sellers to pay some of their closing costs. It may be a set amount or a percentage of the price. Most loan programs limit this to 3% of the purchase price.

Down Payment Assistance- Through down payment assistance programs, charities like Nehemiah and Ameridream may pay a portion of the buyer’s down payment. For this to happen, the seller is asked to contribute to these charities. We have to subtract this amount from the sales price as well, not forgetting any ‘processing’ that the charities charge, usually an extra $500. (Note: These programs are set to disappear soon with the latest housing legislation that congress has passed.)

Closing Attorney’s Fees/ Doc Prep Fees- These vary depending on your closing agency, but is usually around $250-300. You might also encounter some smaller $20 fees for overnighting paperwork or wiring monies for your loan payoff, as well as courier fees to get the documents to the Buyer’s closing attorney.

Property Taxes- In Nashville, these taxes are paid in arrears, meaning that they are due at the end of the period. Therefore, at the closing, the sellers will pay their portion of the property taxes to the buyer, who will pay all the taxes for the year at a later date. In effect, each party pays their share of taxes for the time they own the property. For sellers who aren’t expecting this, it can be an unexpected surprise at closing.

Mortgage Payoff- It’s good to have an estimate of your mortgage payoff, which is usually found on your monthly mortgage statement. If you need a more accurate amount, you can call your lender, however, remember that interest is charged daily, so the amount will change every day. Don’t forget to include any second mortgage’s that you may have on the home.

Other Fees- There can be many other items negotiated as part of an offer. Items like termite inspections and home warranties are the most common.

After subtracting all of these items from the Purchase Price, we should have a good estimate of the “Seller’s Proceeds”. This is the amount of the check that the Seller should get from the closing attorney after the transaction closes.

It’s a learned skill to do a net sheet. I’m proud to say I had a closing last week that was within $100 of the estimate I gave to the Sellers. Even still, I get nervous every time I’m doing a net sheet because if my numbers are off, you can bet that the sellers will let me have an earful about it!

-Peter
www.NashvilleCityHomes.com

Surprised by Overwhelming Quality

I see a lot of homes. Lately, most of my clients have been looking for their first home. It’s often like looking for the ‘needle in the haystack’ as their expectations are quite high and the budget is quite low. Many of the homes we see are in pretty bad shape, but eventually we find one that is the perfect mix of location, price, and condition to fit their needs. So, after a few weeks of starter homes, I was blown away yesterday by surprise in Sylvan Park.

I was helping a friend named Chris Barber who is an incredible custom woodworker. He takes wood and turns it into art that is also a usable piece of furniture or woodwork for your home. He had made a large wine rack for a client and asked me to help him lift in into this client’s loft.

It was early in the morning and I was just helping a friend so I wasn't expecting what we would find in this tiny home that looked like a detached garage behind a Sylvan Park Victorian. I was completely caught off guard as we stepped inside.

Most home I see, it seems, are at varying levels of 'livable', with some described as 'fully renovated'. Even then, not many homes fall into the department of custom designed showplace. That was the case here.

What shocked me was the level of custom details throughout the place. Everything was tailored and hand-selected to make the home feel like a lodge that was nowhere near Nashville.

The work was the highest quality and well done. They had completely gutted the home, raising all the ceilings leaving some beams exposed and built a gorgeous stone fireplace as the centerpiece of the living space.

You could tell that that the home was designed to someone's particular taste, which is what made it so great. It wasn't bland and vanilla, nor was it over-the-top. It was just right.

The kitchen was no less amazing. Chris had custom-built all the cabinets, which feature reclaimed pine to match the mantle that he built. Professional grade appliances mixed with neon whiskey signs and a 6-foot wood carved grizzly completed the décor.

I'm not sure what affects me when I see homes like this. It happens to me every once in a while, but I never really see it coming. I think it's related to the artistic aspect of the home. When someone has a true eye for design and the money to make it happen, it is a wonderful thing.

It was a space that I didn’t want to leave. Again, I’m reminded of how we are affected by the environment we live in. I left inspired to work on my own home, but it will never feel like a lodge in the Rockies…

-Peter

www.NashvilleCityHomes.com
Check out Chris Barber’s awesome woodworking skills here.

Finding House Parts in Nashville

When renovating our 1920’s Bungalow over the past few years, I had to find places other then Home Depot and Lowes to buy house parts that looked like they belonged in a home this old. You can buy the paint and caulk at these stores, but where do you go when you need an old wood door, or a fireplace mantle? Here are some suggestions:

Habitat For Humanity Home Store, 1001 8th Ave South
Habitat runs two stores that are only blocks from each other. Both stores have new/used items that were donated to be sold so they can raise money to build more Habitat Homes. This store, on South 8th has home/office furnishings like filing cabinets, light fixtures, textiles, mirrors and more.

Habitat For Humanity Home Store, 908 Division Street
This store is packed with hundreds of old doors, windows and all kinds of building materials. You can also find kitchen cabinets, bathroom fixtures, paint, flooring and more. The best stuff goes quickly, so you might need to come back often to see what you can find. They post some of their items online so click here to see what I’m talking about.

Hailey’s Salvage & Building Material, 1224 Dickerson Pike
Tons of building materials salvaged from demolitions and renovations. Find clawfoot tubs, vintage sinks, ornate mantles and fireplace surrounds. Might be a great source for items for your rental property. Free tip: Bring the pickup when you go.

Preservation Station, 1809 8th Ave South
After you buy doors at the Habitat Home Store, this is the place to go to buy your antique hinges and doorknobs. They also carry a variety of old doors and light fixtures. This is not a discount store. They carry architectural antiques, which means they are pricey and rare. When you’re looking for that perfect chandelier for your 1905 Victorian home, this is the place to start. They also buy items if you have any antique house parts to get rid of.

Okay, that’s my list. Be careful, though. It’s very easy to find something at these stores that you love, but you don’t really have a place for. You may end up renovating your home just to have a place to put it…

-Peter
www.NashvilleCityHomes.com

Coffeeshops Across East Nashville

Is there some correlation between number of coffeeshops and the health of a real estate market? I remember in 2003 when my wife and I were purchasing a home in East Nashville, we felt much better about the decision after we found the Bongo Java down the street.

That may seem shallow, but I know that you coffee drinkers out there understand.

There are now many more coffeeshops across East Nashville, which may show how this addiction has spread, but in many ways also represents the growth of the neighborhoods to a level that support these business and the many others that have opened in just the past few years.

To review our current coffee options in East Nashville:

Bongo Java East, 107 S. 11th St. (At Five Points)
Portland Brew, 1921 Eastland Ave
Ugly Mugs Coffee & Tea, 1886 Eastland Ave (Walden Development)
Sky Blue Coffee & Bistro, 700 Fatherland Street (Edgefield)
Sip, 1402 McGavock Pike (Riverside Village)

I won't give my reviews of them. Let's just say that I like the variety and hope they can all stay in business for years to come.

-Peter

www.NashvilleCityHomes.com

7 Things to Look For in a Home Inspector

Over the weekend, I heard someone describe my favorite home inspector as “alarmist”. Now I could see how you might get that impression, but I wouldn’t use that word for him. Alarmist has the connotation that he blows things out of proportion. Instead I would call him very thorough.

The discussion made me think about what makes a good home inspector. Believe me, you want a good one- and you often won’t know what was missed until you own the home and you ask yourself, “Why didn’t this come up in the inspection?”

Here are some things to look for…
1. Experience- The best inspectors have done hundreds, if not 1000+ inspections. They’ve seen about everything and they are passionate about houses.

2. Licensing- Typically in Tennessee the home inspector needs to be fully licensed. You can't just have a friend look the home over for you. To negotiate repairs under the typical inspection contingencies the inspector must be licensed.

3. Report- Mainly, you want to see a good summary of the issues that need to be addressed. Some inspectors will provide you with a fancy multimedia report. One inspector I know even shows you a PowerPoint slide show at the end of the inspection, giving you a visual tour through the home’s issues. This may be overboard, but having some pictures in the report of the major issues is standard and very helpful in visualizing some of the problems that are difficult to see, especially in attics and crawl spaces.

4. Thoroughness- The best inspectors will ‘leave no stone unturned’. In other words, they’ll squeeze into tiny attics and crawl spaces to make sure they don’t miss anything. This is so important. I’ve had at least two instances where major issues were found in homes only because my daring inspector went into small spaces that other inspectors might skip and call “inaccessible”. This might actually build the case for hiring a skinny inspector, but I’ll leave it at that! In the end, the buyer should have a detailed and possibly lengthy analysis of the home. I always say that you'd rather know up front what you're buying than find out later.

5. Passion- My favorite home inspectors will take the time to talk with my client about the issues. They have a teaching spirit and strive to help the buyer understand how homes work and what problems in the report are big concerns and which ones are more commonplace and can be lived with.

6. Non-Alarmist- Some inspectors, for whatever reasons, do tend to go overboard and scare home buyers more. For example, I had one inspector who was telling us how unlevel the floors in a home were (which we knew). He actually pulled a marble out of his tool belt and let it roll across the room to emphasize how bad it was. He also made a big deal about some smaller items that weren’t up to codes even though this home was built in the 1920’s. After a while, it’s hard to know what items are actually concerns, and which ones are found in every home in the neighborhood. A great home inspector will make this distinction for you.

7. Price- This barely made my list, because the prices for different inspectors doesn’t vary that much, but if you know of several good ones, it might vary as much as $100, and be worth checking out. BTW- inspections are almost always paid for at the time of inspection, not at the closing. Most will take a personal check and often credit cards as well.

If you’ve read this far, you might as well just give me a call for a referral for a great inspector. I try to go on all my buyer’s home inspections, and I have seen all kinds of homes. Even the best homes have issues to repair or keep an eye on. If you’re buying a house, please have a home inspection and get a good one!

-Peter
www.NashvilleCityHomes.com

The Sellers Are All Banks!

Okay, not ALL the sellers are banks, but some days it seems like it. Yesterday, I showed six homes to one of my incredible buyers and half of them were bank-owned. It's a dynamic that is definitely a change from a couple years ago. Working with a bank to purchase a property is a little different than negotiating with a human. Here's what to expect:

1. Banks are not 'emotionally attached' to this property like normal homeowners may be. They are mostly interested in the bottom line net sales price and how quickly they can get it off their books.

2. In my experience, banks are not as 'desperate' as most buyers seem to expect. They are not likely to take an offer of 10% off the list price under most circumstances. If they were that motivated, they would have dropped the list price. They may be negotiable on price, but we'll have to go back and forth a few times to hash it out.

3. Typically, we'll write up the initial offer and send it to the bank's listing agent. They will then log into the banks online system and input the info from the offer and hit 'send'. We'll then wait a couple days and get a verbal counter offer. In one transaction I was working the listing agent said that she didn't even talk to anyone at the bank about the offer. It was all done through email. After the bank counter-offers we generally work out the details verbally.

4. Once all the terms have been agreed on verbally, the bank will send us a packet of their addendum. Often this is longer than the initial offer and will spell out all the terms. As one recent client rightly pointed out, the language is more bent toward the bank. I'm sure they have a team of lawyers that came up with it to protect them. We'll read it over very carefully! After we sign the addendum the listing agent will often have to overnight them to the bank's asset manager to sign and send back. Once the bank has signed off, you then have a binding contract.

5. Within the bank's addendum will be several pages telling you that they absolutely do not warrant anything about the property and that you are taking it "AS-IS". Of course, it is highly recommended to do a home inspection and make sure you know what you are buying. These properties are often in rough shape with the utilities off, so the inspections are an important step.

6. Because they are selling "AS-IS", don't expect them to fix anything that comes up in the inspection. You may be able to renegotiate the price or something, but the bank isn't likely to spend money repairing the HVAC.

Bank-owned properties can be a great value because:
A) Often these properties are on the market for less than the previous owner paid for them in the last couple of years. For example, I saw a great home in Madison yesterday that was built in 2001. Someone bought it in 2006 for $131k and got foreclosed on. Now this home is listed at $115k and still in great shape. In this case the next buyer should have some great equity when the market comes back. I see this dynamic all the time.

B) They may have a smaller pool of potential buyers because of the rough, AS-IS condition that most of these homes are in, and because the banks will often ask for a large earnest money check with the offer. That home in Madison required a 2% earnest money check or around $2500, weeding out some buyers.

It would be interesting to see how many homes in our housing inventory are bank-owned an how that has affected supply and demand. It seems like the human sellers that don't have to sell for some reason are waiting for the prices to go back up. I don't blame them for that, though I look forward to working with the humans again soon...

-Peter

www.NashvilleCityHomes.com

East Nashville Market Snapshot- July 2008

We had 39 home closings in East Nashville for July at an average of $135 per square foot. Three homes sold over $400k with the top sale being 1209 Holly Street at $555k. The average days on the market were 74.

To put this in perspective we had 58 closings in July 2007 at an average of $119 per square foot. The average days on the market were then 56 days.

Comparing these we again see the trend of rising prices per square foot with fewer homes selling. This may just be the effect of buyers being picky. The homes in the best condition and location are getting picked, while those needing work or funky floor plans wait on another buyer to come along.

This is a different dynamic for East Nashville than a couple years ago when there were fewer homes to select from and buyers felt confident that prices would continue to rise and protect their investment. Today, you need to list your home in the top third of your market for condition and the bottom third for price.

In this type of market, it’s extremely important to do as many repairs to your home as you can, clean it thoroughly, then stage and de-clutter before listing it. It may be the difference between it selling and not.

-Peter
www.NashvilleCityHomes.com

A Closer Look At PMI

PMI stands for private mortgage insurance. No one really cares about it until it's time to get a mortgage. If you aren't putting down at least 20% expect to see a PMI charge as part of your payment each month. It's basically like paying an extra 1% of interest on your loan per year.

Why would anyone do that?!

The banks require it. In the olden days, buyers HAD to have a decent down payment so that the banks felt comfortable loaning the money. In order to increase their business the banks figured out a way to offset this risk to an insurance company that insures them against default. Of course, the buyer has to pay for this.

Note that I said, "insures them [banks] against default". This will benefit the banks, -not you, the borrower. If you default, the PMI company may cover the bank's losses, but they can then come after you for the money unless the bank has forgiven the loan.

I was meeting with a seller the other day who thought the whole thing was crazy. He said, "The banks think we can't afford $1100 a month, so instead they charge PMI, increasing the total payment to $1200 a month! That doesn't make any sense!"

He's right, but having PMI was the only way that the bank would have made this loan. It was figured into the payment from the beginning and without it, he might still be renting.

The good thing is that Federal law requires PMI to drop off after you have at least 22% equity in the home. You can also be proactive and get them to remove it as soon as you reach 20% equity in the home. Contact your lender to find out how they handle it. If you've made improvements or had substantial appreciation you may be able to have the home appraised to show the increase in equity and get the PMI removed.

Please note that I am not a mortgage guy so check with your lender to better understand your exact situation and how PMI affects you.

-Peter

www.NashvilleCityHomes.com

Making An Offer With an FHA Loan

With the changes in the mortgage industry many home buyers are turning to FHA Loans because they still offer the opportunity to purchase a home with little or no down payment. There has been a noticeable increase in buyers using FHA even among my own clients.

The problem is that there are a lot of misunderstandings about how this works, some of which I addressed in my article, "Myth-Busting FHA Loans...". Today I wanted to talk about how to structure an offer when you're using FHA.

Two main questions-
1. Should we ask for the Seller to pay for some or all of your closing costs?
2. Do we need to ask the Seller for down payment assistance?
Both of these items are built into the offer, often on raising the sales price so that the bottom line is still agreeable to the Seller.

Closing costs are extremely common to ask for. The costs vary, but most programs will only let the Sellers pay 3% of the purchase price toward your closing costs and prepaids. This will save you (as the buyer) some out-of-pocket cash and basically let you roll these fees into your loan. We want to make sure to include this in the offer.

The misunderstandings come when we're talking about down payment assistance. Currently, the Seller can contribute to a 'charity' such as Ameridream which, in turn, will contribute toward the down payment. There are rumors that new legislation in congress will change this, but for now, it's still happening. (Read how it works here.) It's best to talk to your lender about this because often then banks will have specific wording that they want put in the contract to make this happen. So, in addition to asking for closing costs, we would ask for 3-5% of the purchase price to be paid toward the down payment.

Help the Seller Understand
Often, the biggest hurdle to overcome with an FHA-financed offer is helping the Seller understand it. They often think that the Buyer is trying to be sneaky and take advantage of them. The key is to tabulate all of the numbers and focus on their net proceeds- how much they will make from the sale. It can also be helpful to compare these numbers to how a conventional loan would be handled so they see the differences.

The goal in every negotiation is agreement- a win/win situation. For the most part, Sellers seem open to these type of offers, but it takes a little more time to educate them and build trust. As it becomes more common, I'm sure it will get easier for us all.

-Peter

www.NashvilleCityHomes.com

Nashville Zoo is Worth Checking Out!

Saturday was a hot one, so what did we decide to do? Spend the time outdoors- at the zoo!

This was my first time at Nashville's Zoo, even though we have a family membership and my wife has taken our kids there a handful of times. I must admit I was impressed. Of course, it doesn't even compare to places like San Diego's Zoo, but for Nashville, it was quite nice. Much more than you can see in one day and keep your sanity.

We came late in the afternoon with the intention of just 'getting the kids out of the house'. It was hot, but there are lots of shady paths were we could find some relief. My son Noah, who is now 4, is a zoo veteran and was our tour guide for the day. He quickly led us to see some exotic birds and monkeys before running ahead to show us the meerkats.

After much pleading from the kids we ended up at the playground, which is a mammoth structure full of hiding places, tunnels and rope ladders. It was awesome, except I had trouble keeping track of everybody. Of course, if I waited long enough, Noah would always find his way down the enormous corkscrew curly slide to find me sunburning at the bottom.

The trip would not be complete without a ride on the carousel, which was thankfully free this evening to zoo members.

Chasing a four-year-old around the zoo wore us out so we'll have to see the elephants and giraffes on another day. If you haven't been to the zoo, it's worth the time to check it out. If you live in Nashville with kids, it's even worth the family membership to get them 'out of the house' once in a while.

-Peter

www.NashvilleCityHomes.com

Germantown Plans and Condos Everywhere!

I've been touring many of Germantown's cool new developments with a client moving here from Seattle. It's been great to compare the different units and get an intimate feel for how the area is poised for continued momentum. Let me highlight some of my favorites:

Werthan Lofts- Wow! There is nothing else like it in Nashville. A true factory that is being converted into fantastic loft space with tall ceilings and nice views. Even more, they are creating a new community space complete with pool, dog run, bocce ball court and a coming-soon cafe+nightspot in the 'boiler room'. The vibe here is awesome, especially on cool evenings when folks gather outdoors.

Morgan Park Place- Like Werthan, this project is yet to be finished, however, the available units are quite stunning. Lots of upscale finishes and over-the-top efforts in 'green-building'. They've actually received top awards for their energy efficiency techniques that might save you quite a bit when it comes to your monthly utilities.

Row 8.9- This development has been complete for a few years now, but occasionally units come up for sale. It's a "Chicago-style brownstone" development, which means the units are aligned in a row with steps down the street. The units on Rosa L. Parks Blvd have unbeatable views of the capitol and downtown skyline while being literally across the street from the Farmer's Market and Bicentennial Park. All of these for a very reasonable price- lower than most of the other similar units around town.

There are many others to check out if you're interested, and it seems that there is no stopping these developers who are forging ahead in Germantown. The whole neighborhood is full of new condos and historic-looking infill homes built to reinforce the roots of the neighborhood while adding the modern amenities that people demand these days.

Guiding much of the development is a Detailed Neighborhood Design Plan that the Metro Planning Commission put together in 2002. It's quite interesting, especially if you live in the area or are considering it.

-Peter

www.NashvilleCityHomes.com

Gra-Mar Neighborhood in Inglewood is Lookin’ Good!

I’ve recently become a fan of a somewhat unknown pocket of Inglewood called Gra-Mar. It’s an area full of ranch style homes from the 1960’s, many of which were built on very large lots. Part of the area is dubbed Gra-Mar Acres for this reason.

The neighborhood is just south of Briley Parkway between Ellington Parkway and the railroad tracks closer to Gallatin Road. It extends south to Broadmoor or so.

So what makes this neighborhood look so good these days?

Price- Homes in the area average around $93 a square foot these days, less if the home needs upgrades from it’s 60’s interior. At this price a 2000 square foot family-sized home with 3 bedrooms and 2 baths will cost you around $186,000. A smaller 2 bedroom home will be priced in the lower $100’s. Compared to the rest of Inglewood or East Nashville, this is quite affordable, especially considering the following points…

Lot Size- This is one of my favorite parts- space! Room to spread out a little, and still be 10 minutes from downtown. Many of these homes are on lots of at least half an acre. It’s more to mow, but you don’t have to go to the park to see grass and mature trees.

Quality- Most homes in this area were built in the 1960’s and many were more custom with lots of tile and unique brick exteriors. They are built to last, and most are in great condition with little maintenance.

Neighbors- Homes in Gra-Mar don’t come up for sale that often. That’s because many of the residents have been here for years. They bought the homes to raise a family and they didn’t leave. Driving through, you can tell that people care about their homes and you’ll even get a friendly greeting from people you might meet.

Convenience- As mentioned above, Gra-Mar is conveniently located right off of Ellington Parkway about 10-15 minutes from downtown or Rivergate. You can quickly get to Opry Mills or even the airport by taking the new and improved Briley Parkway.

Upside- At this point, Gra-Mar is an undiscovered area that people are starting to notice as more homes get renovated or come up for sale. It’s super close to the new Inglewood Home Depot as well as the new Wal-Mart Supercenter & more that are being built across from Skyline Medical Center.

If you're looking for a solid home with lots of grass, check out Gra-Mar and some of the surrounding areas. You may need to give it some updates, but it's definitely in a neighborhood that's worth the investment.

-Peter
www.NashvilleCityHomes.com

“Easy to Show”- Music to my ears!

When I’m hunting down properties to show to buyers I love to see the words “Easy to Show” in the listing. Another good phrase is “Vacant-Show anytime”.

On the other hand, making showings difficult is a good way to keep your house from selling. How about these:

-Make Offers Contingent Upon View Interior
-Do Not Disturb Tenants
-Day Sleeper- No showings before 4 pm
-Agent Must Be Present For All Showings

I know that sometimes the circumstances can sometimes make showings terribly inconvenient, however, please know that putting any kind of restrictions on showings when your home is for sale will reduce the number of buyers that see your home. Even something simple like requiring 2 hours notice.

I also know you can’t always show your home at the drop of a hat, but again and again I’m out showing homes in a neighborhood and the buyers notice one for sale across the street and want to see it too! I hate to tell them that we’ll have to wait and do it another day.

The goal is to make it easy to show, at least as easy as possible.

On a side note, I believe this is even true for investment properties. These are often difficult to show if there are tenants involved. That's understood, but at least try to upload some interior pictures to see it it's worth the hassle to show. Even just a couple pictures of the inside help buyers get an idea of the home and decide to take a look. Without any interior pictures, people assume the worst and skip it. They assume that it looks terrible; otherwise there would be pictures, right?

So, the home-selling lesson for today is…
1. Make it “Easy to Show”
2. Have lots of fantastic pictures

Thinking about it? Give me a call.
-Peter

www.NashvilleCityHomes.com

Good Bones Make a Great Fixer Upper

I enjoy working with clients who have the passion to take a neglected home and renovate it. Make no mistake, this is a BIG job. It will consume your life if you aren't careful, which is why it's so important to look for good bones.

"Good bones" is a way that people describe the fundamental parts of a home that are difficult and expensive to change. Things like floor plan, room sizes, electrical/plumbing systems, ceiling heights, etc. You can paint and add granite counters to any home, but if it’s missing some of the fundamentals, you may have trouble selling it later.

I was exploring some of East Nashville’s fixer-uppers this morning with a wonderful client of mine. We looked at some that needed hardly any work and others that needed complete renovation. Since I try to attend every home inspection personally and I've renovated a home myself, I’ve learned quite a bit about the systems in a home and where the common problems are. Sometimes I probably point out too many things to my clients, but I want to help them understand what their getting into.

Here are some bones to look out for:

Floor Plan- Watch out for funkiness. Does the layout make sense? Is one of the bedrooms a walk-through? Are there closets? Where will the fridge and dining room table go? Where is the washer and dryer? A home with a great floor plan will be easier to sell down the road.

Structure of the Home- How is the foundation? Are the floors level? Is there water damage? What’s causing it and is it easy to repair? Is the roof in good shape? Is there a basement or crawlspace? Any water problems down there? (BTW- water issues are the #1 killer of a home, reminding us all to clean out our gutters!)

Systems- Are the systems outdated? What about the HVAC? Are there old ducts wrapped in Asbestos tape? Is the wiring grounded? Fuses or circuit breakers? Any knob & tube wiring? Galvanized or copper plumbing? How’s the water pressure?

Location- This should probably be at the top of the list, since it cannot be changed. More than anything else, location will greatly affect the value of the property. Don’t think you can overcome it by dressing up a home in the wrong neighborhood!

Lastly, when you’re considering a fixer-upper, you have to know the numbers going in. What are other homes in the neighborhood selling for? How much money and time will it take to renovate it? How quickly are home selling? What are the trends in the area?

It’s a lot to think about, but when you’ve made a thoughtful choice, renovating a home can be an enjoyable and profitable experience. Otherwise, you may lose your shirt…

-Peter

www.NashvilleCityHomes.com

3 Ways FSBO's are Missing Out

I was talking to someone this afternoon who is trying to sell their home by themselves without an agent. She said that her main reason for doing this was that they couldn't afford any extra fees for Realtors. They owed too much on the home and were already behind on their payments.

This is a sad story that is happening too often right now. However, I'd say that situations like this are the most important times to work with a Realtor. Especially when the market is slow and buyers are few. Let's examine why I think this seller is missing out...

1. Who knows that her home is for sale??
This is a biggie. She has a sign in her yard. Even if she's on a for-sale-by-owner website, the most qualified buyers- those using a Realtor and needing to buy quickly- are searching the MLS and missing her home. I only knew about it because my client drove by.

Contrast this to how I market homes. Not only are my listings in the MLS with professional pictures and a virtual tour, but it's broadcast to numerous other home home searching websites and promoted by me through everything I do. People searching for homes online (which is where people look nowadays) will find my listings and they will look great.

2. Agents will not show your home. This is true mainly because they don't know it's for sale! In this case, the sellers were not offering any commissions even to the buying agent. In effect, they are actually discouraging me from showing their home. We may eventually take a look, but it will be at the bottom of the stack.

3. What risk is the seller taking by being unrepresented?? As a Realtor, I believe that much of my value comes as I help negotiate the contract and then keep things from falling apart to the closing. Even so-called easy deals can have things pop up that can cost lots of money or ruin the entire agreement. My experience will help you avoid these issues and be prepared for each step of the process. Even if a FSBO doesn't hire me, I try to encourage them to hire somebody. It's just not worth the risk.

I appreciate a seller wanting to make more money on their own. It just seems that selling your home is a time when it's best to work with a professional. If you try it, please be careful and willing to be very patient. If you'd like some help, give me a call. :)

-Peter

www.NashvilleCityHomes.com

Perceptions More Important Than Facts?

I've been reading articles from leading minds in the real estate market who are attempting to forecast the beginning of a recovery. Here's an interesting one from the Wall Street Journal entitled, "The Housing Crisis Is Over". In it, the author, Cyril Moulle-Berteaux, says that we've hit bottom and "...that the trend is no longer getting worse, which is the critical factor."

Moulle-Berteax goes into the historical data and has a lot of good reasons for his statements, but will he be right?

I tend to be an optimistic type, but I also strive to know the truth and look at the facts of the situation. However, in this case, perceptions may be more important than the facts.

I took a minute to read over a few of the comments to the accompanying blog and the overall tone was that we have NOT hit bottom yet. Further, an NBC/WSJ poll on April 30th reported that 81% believed that the US was currently in a recession.

By the formal definition, we are not in a recession, however, with 81% of the public believing that we ARE in a recession, then for all intents and purposes, we are.

Gary Keller makes this exact case in a recent white paper released to Keller Williams associates:

Wisdom of the crowd, perception is reality, what you see is what you get. If it’s true for you, it’s true – any way you want to posture it. We’re saying that if it walks like one and talks like one, it is one, and we might need to face that reality.

What does all of this mean? Here are my two thoughts for the day:
1. It has become even more important to be an expert on the LOCAL market. Keller also says, "What’s happening within your local markets is all that’s relevant." Even within the broader Nashville market, different neighborhoods have different dynamics going on.

2. Buyers are super-cautions right now. I can't blame them for that. Buyers are looking at more homes and being picky. They want to know that they are making a sound investment and making good choices.

I guess we'll wait and see when we hit the bottom. Of course, we probably won't know it when it happens, but since we all need a place to live, it will happen.

-Peter
www.NashvilleCityHomes.com

Advice From the Mystery Man

I was having breakfast with a friend this morning at my favorite greasy breakfast spot, the Hermitage Cafe. We were talking about business and were probably too boisterous when another gentleman joined in with our conversations. I'll call him the 'Mystery Man' because he didn't introduce himself and he was dressed to hop on his motorcycle and speed away.

The Mystery Man wanted to comment on how important it was to form relationships with clients. He said that people wanted to do business with people who would take care of them. He spoke against emailing and said that people don't just have conversations anymore.

I took note of this stranger because even from behind his dark sunglasses I could feel his passion for business. He later said that he was retired from insurance sales and just loved doing business. I have no idea how successful he was, but I could tell he was living large.

This brief encounter was a timely event for me as I'm working on deepening my relationships. It affirms to me that people like to work with people who sincerely care for them. The Mystery Man reminded me how much fun it can be to do business and be a part of people's lives.

Let's live large,

Peter
www.NashvilleCityHomes.com

Myth-busting FHA Loans- A Success Story

With the tightening of loan qualifications with most lenders, the 100% financing of yesteryear is all but gone. However, there is a way with FHA. In fact, I had some clients close last week who bought a home with nothing to pay except a little earnest money.

FHA loans are quite mystifying until you worked with them a couple times. I’m not mortgage guy, but let me explain the basics from my experience, both on the buying and selling side of them. First, a couple myths to bust:

MYTH 1- FHA will require lots of repairs
Years ago this may be a concern, but the revisions made in January 2006 loosened many of the guidelines, requiring fewer items to be repaired. The inspection for these repairs is done by an FHA approved appraiser as part of the appraisal.

MYTH 2- Sellers will have extra hidden costs to pay
As with any contract, everything is negotiable. It is very common that the sellers will assist with the buyer’s closing costs or possibly contribute to a charity like Ameridream to give the buyers some down payment assistance, but this is all negotiated upfront. Before we have a binding contract, the seller will know their net proceeds from the sale without fear of surprise costs due to the FHA financing.

MYTH 3- Financing for FHA buyers is more likely to fall through
I doubt it’s any more likely than with any other financing. I’m not sure about the exact stats, but the strength of a buyer’s pre-approval is always suspect until the lender has actually collected the required paperwork to make sure that they qualify and that no surprises lurk beneath the surface. It’s always good to work closely with the lenders to make sure that the buyers really are qualified, but sellers who are worried about this should probably just be thankful to have a buyer, right? :)

To achieve a 100% loan through FHA, the seller or possibly a family member contributes to a charity such as Ameridream who will, in turn, contribute toward the buyer’s downpayment. Sellers are often uncomfortable with this at first, but I always try to explain it upfront so that they understand how it works. The funds are built into the sales price and negotiated upfront. It’s completely legal, but still a little complicated. I wrote more about these programs in this article from Jan. 2007.

Back to real life… My clients last week bought a historic home built in 1932. It hadn’t been renovated, but has been in the same family since the ‘60’s. It wasn’t in major disrepair, but still had some old knob & tube wiring, and all the plaster walls intact. Very low funk factor. The only FHA repair we had to do was to replace a portion of the roof that had an obvious leak that had come through the drywall in a back addition on the house. This was no problem, since the buyers were going to fix that anyway. (It helped that their Realtor [me] occasionally does some roofing and drywall, eh?)

The lending bank was a slow mover that I’ll avoid in the future, but otherwise, the process went smoothly. In the end, the buyers were thrilled and excited to finally own a home of their own. They’ve already started ripping up carpet to reveal some well-preserved hardwood floors.

After a few successful closings involving FHA financing, I’m a fan. They do require some extra work and sometimes a lot of patience, but a qualified buyer can still own a home without a down payment.

Just make sure you work with a great lender and Realtor who can get it done for you. Thinking about it? Give me a call.

-Peter
www.NashvilleCityHomes.com

My Best Investment

Last weekend I took off a couple days to go on a short vacation to Chattanooga. Every time I attempt such a crazy thing, I have loads of work to do before I leave and even more to catch up on when I get back. But it's worth it.

Relationships are worth the investment.

Something I'm learning is that whatever the market does and however business is going, the most important thing is to tend to my relationships. Some of this I'm learning the hard way because I'm not very good at it, but I AM learning.

It's part of having good balance, or being correctly 'counter-balanced' as my business coach would say. In many ways, Realtors are connectors within communities. I bring people together, from home buyers and sellers to roofers and whatever.

So, back to my vacation. Not only is it nice to spend time with my family away from home for a few days, but it's nice to catch that excitement for coming back home and getting back to work refreshed.

My advice... take a vacation!

-Peter
www.NashvilleCityHomes.com

Convention Center Debate Continues

The debate for and against the proposed Music City Center is heating up as plans begin to materialize for a new convention facility to be built downtown in SoBro (South of Broadway) and replace our current one.

The Nashville City Paper reports that it's one of the largest building programs in the U.S. right now with a projected cost of $635 million.

I'm actually excited about the prospect, mainly because it seems like it would spur more development in SoBro and maybe bring more life to this developing area, as well as the entire downtown.

I grew up in Indiana and always enjoyed going to the convention center in Indianapolis. They redeveloped it with the huge Circle Center Mall and did a great job of connecting the mall and convention center with parking and other attractions. You could easily walk to everything without even going outside if you wanted to.

Admittedly, I'm quite ignorant when it comes to how profitable these centers are and if it's worth the debt that will result. The comments in the blogosphere are quite fierce on this subject. It's a topic worth debating, but I'll leave the debate to others.

It doesn't sound like they're even at the design phase yet, but a couple local citizen groups have proposed some nice plans that are against the 'big box' type of convention center, but instead a incorporate lots of retail/restaurant/office space in such a way that will be an attraction for those of us locals not attending a convention.

The folks at http://www.mccproject.com/ propose a more pedestrian friendly design that would connect nicely with the other downtown tourist spots like the Country Music Hall of Fame and the Schermerhorn Symphony Center. Visit their website and check out all the conceptual pics.

The Music City Center Coalition is another group that is advocating the new development. On their website they make their case for the new Center and how to get it done, along with lots of news releases. Lots of interesting information.

If you ask me, it just seems like the logical next step for a growing city like Nashville, especially considering the amount of tourism we have here. It will be interesting to see what happens as downtown continues through these growing pains and becomes a bigger metropolitan area.

I'll try to stay on top of the news for you!

-Peter

www.NashvilleCityHomes.com

High End in the East End

I've noticed some remarkable new listings lately in East Nashville for over $800,000.

Yep, there are currently three East Nashville homes listed in the $800k's with one historic mansion nearing $1.4 million.

To illustrate the magnitude of these prices, I have to go even further and mention that there are currently 12 homes listed with a price point above half a million dollars. Here's the list:

1610 Russell $534,900
818 Woodland $542,500

1622 Forrest $549,900

1306 Woodland $554,800

1202 Woodland $599,900
813 Russell $650,000

719 Boscobel $669,615

1407 Stratton $699,900

720 Boscobel $824,615

900 Boscobel $849,500

809 Russell $898,500

504 Russell $1,375,000

The zinger is that Realtracs only records 5 homes ever selling for more than $500k with the highest sale to date at $550k.

Before we all shake are heads at these unprecedented prices, let me reiterate that these homes are quite remarkable, something I have a passion for.

A quality that I've seen in myself is that I really appreciate a great 'environment'. I love taking a space and making it better. Lately, this has been displayed through landscaping or renovating a home. I appreciate quality work and some of these showplaces in East Nashville have it all.

In fact, I toured one such home at 900 Boscobel before it was on the market. Touring the home was almost a 'spiritual experience' for me. I'm not trying to be sacrilegious, actually quite the opposite. The home was built from the ground up. Every material and detail of the home was thought out and assembled like a quality piece of art (note the artistic chandelier pic). I could see glimpses of the Artist throughout and it was incredible.

Anyway, as fantastic as it is, is it worth $849k??? Time will tell, I suppose. Most people that I've talked to about it seem to have huge doubts, but if there is a home that has 'the goods' that home was it.

East Nashville is setting new precedents all the time, from homes selling at $200 per square foot, to having a hot dog stand in an old Volkswagen van. So, hey, why not have some $800k homes in the neighborhood too?

Wanna buy an estate in East Nashville? Call me today. I'd love to help you set some new precedents!

-Peter

www.NashvilleCityHomes.com