Unstructured: Editor's Blog of AOL Real Estate

Power of Staging

Fri, 04 Apr 2008 19:20:24 GMT

Washington Post Profiles Professional Stager

While professional stager Lyric Turner admits that she's making less money as a professional stager, she's having a lot more fun doing it.

Anyone who has a flair for color and spacing can be a potential stager, but there's no Coldwell Banker of staging or Bachelor's Degree of staging that you can get that will give you credibility. Either you can do it or you can't. Certainly a few months as a regular real estate agent might help you establish some street cred in the marketplace, but no certification is required.

Ms. Turner generally charges $5,000 to $6,000 for two months to stage a vacant three bedroom house. Considering that most people are probably looking at a $10K reduction in price if they can't find a buyer, that money is most likely well worth it. She also does consultations for as little as $250.

At the same time, I've noticed on HGTV's "Get It Sold", they generally reduce the price first and then stage the home, so it seems like a bit of a bait and switch -- but sellers who have given it a shot on their own are probably likely to try almost anything to get their homes sold. However, on that show, they are usually spending $1,000 or so, so it's not really costing the buyers anything, and on at least a few shows, I've seen a bidding war break out, so they end up getting higher than the list price.

Staging also seems to be more effective in condos and town homes that are basically the same.

If you are looking to sell your home for top dollar, you may want to ask your agent about working with a stager, or see if one of your friends is an aspiring stager. Maybe they can reorganize your space for free and start building their own portfolio.

For More on Staging Your Home.

Tags: staging, dc, real estate

Two Years of Housing Doom

Sun, 01 Jun 2008 16:06:45 GMT

Housing Doom Blog Celebrates Two Year Anniversary

For you johnny-come-latelies of the housing "correction," these guys have been covering it day and day out for the past two years.

Not sure what the exit strategy is for a blog called Housing Doom, but maybe they are buying all these foreclosure properties cheap and just keeping their fingers crossed.

A dedicated blog team that deserves more recognition.

Tags: housingdoom, anniversaries, real estate

Power of the Suburbs

Sun, 01 Jun 2008 16:01:29 GMT

Economist Looks at Levittown, Strength of the U.S. Suburbs

Thought this was an interest "briefing" by our friends across the Atlantic at the Economist and their increasingly U.S. based readership.

Particularly this chart, which shows that the almost absurd level of growth in the suburbs from 2000 to 2006.

Defying stereotypes about "houses made of ticky tacky" you can see the large influx of diversity. What is not shown, but is mentioned in the article, is the influx of same-sex couples into the suburbs.

"Between 1990 and 2006 the city of Chicago added 50,000 residents, reversing a long decline. Not bad -- but in the same period the sprawling metropolis outside the city proper grew by well over a million."

While you may hear a lot about how great downtown living is, or how cities are offering more of the modern conveniences, at least until now, that has really not been the case in most American cities. However, was surprised the Economist did not take the story one step further, and examine how the rising gas prices and foreclosures may hurt the suburbs more than the cities, by making proximity to public transportation more compelling. While foreclosures may be an inconvenience in a city like Boston or New York, they are devastating to suburban markets such as Stockton, Ca., and other Western exurbs.

So, while this article did a great job of showing the power of suburbs in the last half decade, one can only wonder if things are already changing, or will it just be more of the same.

Tags: suburbs, real estate, economist

American Dream or Indentured Servitude?

Sun, 16 Mar 2008 20:06:39 GMT

New Yorker Essay Says Ownership Ties People/Economy Down

"In the U.S., it may be worth noting, the states that have the highest unemployment rates—states like Alabama, Michigan, Mississippi—are also among those with the highest homeownership rates. ... And reluctance to move not only keeps unemployment high in struggling areas but makes it hard for businesses elsewhere to attract the workers they need to grow."

This essay does a great job of calling out the biggest downside to homeownership -- increased difficulty in relocating.

Particularly in an area where one of the mainly employers suddenly lays off a significant portion of the workforce, the housing market is going to be flooded with homes for sale, valuations are going to drop, and owners will be forced to choose between selling at a loss, foreclosure or making the payments on a home with income they don't have.

At the same time, there is a lot more affordable housing in the United States than there are in places like Switzerland (mentioned in this article). Renting may not be a particularly viable option in rural areas where most homes are owner occupied, but you could see a scenario where the main breadwinner in a family might rent an apartment in another city as the rest of the family continues to live in the home they own.

In fact, NPR's Marketplace did a piece on Canadians from the eastern part of the country who spend most of the year in the mining towns of western Canada's providences, because they want their children to grow up somewhere completely geographically seperate from where they live. This is not uncommon in other parts of the world.

Of course, there's also no socialized medicine in the U.S., so owners for the most part need employment to be able to provide medical care for their families.

While this article raises some great issues, it probably doesn't do as much to suggest solutions, besides curbing our enthusiasm for ownership, which may be too little, too late.

Tags: new yorker, ownership, renting

How You Look at It: Markets Since 2003

Sun, 16 Mar 2008 19:05:07 GMT

18 Out of 25 Markets Are Up Since 2003; 7 Are Down

The Wall Street Journal and Radar Logic put together this graphic to illustrate the price per square foot in 25 major cites from 2003, 2005 and 2007 (2008 data not available yet.)

On the main page, the number you see is the year prices were the lowest. So if you see a blue square for 2007, that would be bad, because that means prices are lower than they were in 2003 or 2005. No cities are green, ergo the prices in 2005 were always higher than either 2003 or 2005.

Out of the 25 cities, seven, or slightly less than a third, show price depreciation since 2003 per square foot. Four of these cities are in the Midwest, including Cleveland, Columbus, Detroit and St. Louis. The other three are Denver, Boston and Sacramento.

So, the question from my perspective is, if you were told you had a 66 percent chance of your home being worth more in four years than it is was when you bought it in 2003, that seems like a pretty good bet, doesn't it? If you take Detroit out of the mix, the odds actually go to 6 out of 24, so you had a 75 percent chance that your house would be worth more after four years.

If you bought in 2005, you probably aren't happy in some of these cities, but if you expected to show a profit on your home after two years, that just hasn't been the case historically. I suggest wait another year or two, rent your house out if you need to, and read this article about lowering your property tax assesment

I'm hearing a lot about how bad things are in Miami, but this graphic has prices up 40 percent from 2003 to 2007, although down 10% from 2005. In Atlanta, you have a market that has barely changed, with prices rising 1.2% from 2003 to 2007.

So, some much appreciated historical perspective on how we got where we are.

Tags: housing, real estate, valuations

Checks in the City: A Fractional Resurgence?

Sun, 16 Mar 2008 18:37:40 GMT

Fractional Ownerships Marketed in NYC, Paris, Etc.

At AOL Real Estate, we've looked at fractional ownership in the past. Possibly because buyers are less likely to want to cover multimillion dollar condos as a pied a terre or second home, this post discusses opportunities to "own" a portion of the weeks in luxurious condo-hotels such as the St Regis in Manhattan. Particularly for euro-toting foreign buyers that visit U.S. cities on a frequent basis (say six or eight times per year), this seems like an interesting idea.

"St. Regis rolled out their fractional development in 2006 on several floors of their midtown hotel. There are studios, and one- and two-bedroom units for $300,000 to $750,000 a share with 28 days of use a year."

For example, if you try to get a three or four star hotel room in Manhattan during certain weeks of the year, such as right before the Christmas holidays, you can expect to pay three to five hundred dollars a night if not more, so a week is costing you $2,100 to $3,500 as it is. At the low end, you can probably get some nights for $200. So 28 nights a year at $200 a night is $4,800, and $14,000 at the $500 level.

If you financed that over 30 years, a $300,000 fractional at $10,000 per year plus interest starts to look reasonable for four weeks a year, plus assume there's at least some resale value.

As the post calls out, there can be a lot of fees involved, so at some point just getting a normal hotel room may be more reasonable, assuming my math hasn't bored you to tears.

Plus, most of us have better things to spend $300,000 on.

Tags: fractional ownerships, st regis, nyc, timeshares

Real Estate TV Shows Stay Hot as Markets Cool

Sun, 16 Mar 2008 18:18:02 GMT

Several New Real Estate Reality Programs Indicate Ratings Are Still There

Happened to catch an episode of Property Ladder last night where the flippers went over budget by about 200%. They still ended up making about $100K on their sale.

According to this AP article, HGTV had it's highest rates every in January, with nine of it's top 10 shows being about real estate:

"Nine of its top 10 series deal with the housing market, including "House Hunters," "My First Place," "Hidden Potential," "Buy Me" and "Design to Sell." The network did a special Feb. 29 theme day of "taking the big leap," or investing in that first house."

On the one hand, this may just indicate that with the writer's strike, people who normally would be watching "The Office" or "Lost" were watching more cable shows instead of repeats. I watch HGTV as much or more then the next person, and I think three of the those five shows are pretty lame.

At the same time, it's not like HGTV in particular has a lot of choice in their subject matter, since Home is in the name of the channel.

Also, it's not like HGTV's advertisers are going to be very happy if they start running shows called "I Want to Keep Renting" or "Too Broke to Redo My Kitchen."

One show that was pretty interesting, Bravo's "Million Dollar Listing," seems to have fallen off the radar, and some of these "flipping" shows are as much about the personalities as they are about investing in real estate. Is "Hell's Kitchen" a cooking show, or is it really a show about a cook who happens to be kind of a jerk.

On some level, same thing with "American Idol."

Tags: reality tv, real estate, flipping

New Loan Limits

Sun, 16 Mar 2008 17:56:29 GMT

Thanks to CNBC's Diana Olick for this HUD post that allows you to check the limits in your area:
http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/08-06ml.doc

Tags: hud, higher loan limits, jumbo loans

Are DC Sales Up or Down?

Sun, 16 Mar 2008 17:46:37 GMT

Close to Home: One Study Finds DC Sales Up, Index Says Down

"... , home prices in D.C. fell 9.4% in December according to the Standard & Poor’s S&P/Case Shiller Home Price Indices report, which tracks sales of the same homes over time and is generally considered to be the best measure. But John McClain, senior fellow and deputy director for the Center for Regional Analysis, said the multiple listing service data is sometimes more accurate in a down market."

One commenter calls out this home inventory link, which shows prices down less than 2 percent in the last month, but with inventories rising almost 10 percent. Certainly one expects inventories to rise some what on a seasonal basis as the D.C. market enters the peak spring selling season, and a 2 percent price dip isn't too bad, but what seems clear from the report is that prices are way down in some areas like Prince William County and Loudon, and flat or only down slightly in other areas. ("In Prince William County, home prices dropped 25% in February compared to a year earlier. And prices fell 12.3% during the same period in Loudoun County.")

In a word, the market is certainly frothy, which is probably better than stagnant.

Tags: dc, real estate

First-Time Buyer Questions

Mon, 25 Feb 2008 19:18:35 GMT

Do you think that you have to have two full-time incomes in order to afford a home these days? Would you look at alternative sources of income, such as renting out a room or take a second job in order to keep up with rising housing costs?
Post Your Thoughts

Are you worried that some senior citizens may not be able to afford to keep their home as prices for utilities rise?
Post Your Thoughts