There's a lot of opinions out there, and some of them make it into the 'news.'

Someone told me today that they'd read that a seller should never sign with a realtor for more than 30 days.

Changing agents every 30 days is just foolish.

How hard is someone going to market your property if their chance is up in 30 days? Sure they'll put out a yard sign and hope they get lucky, but why would they invest any more time or money?

The determination of how long to list with a company should have much more to do with your comfort level with the agent's professionalism AND with the average number of days homes are on the market.

If the average time on the market for homes in your area is 187 days with another 30-45 days in escrow before closing, maybe you should sign a 9-month listing.

The only reason to change your agent is if you feel your agent isn't advising or representing you well.


Big secret:

Buyers Do Not Care What Color The Yard Sign Is

No buyer gets up in the morning and says, "Today we're only looking at houses with blue signs in the yard."

Three things sell a home, and only three.

Condition, Location, and Price.

YOU the homeowner are in control of two of those variables and the third you can't do a darn thing about.

The only thing your agent can do is provide you with the broadest exposure possible, and give you ongoing feedback, market research, and advice.

It's an uncomfortable truth, but the only person in control of whether or not your home sells is you.  Bring your condition and price into alignment for your location and your home will sell. All the marketing in the world won't make a bit of difference otherwise.

Appraisals and Appraisal Management Companies

On May 1, 2009, the Home Valuation Code of Conduct (HVCC) took effect. This new set of federal regulations is intended to distance appraisers from anyone who is party to a transaction (the seller, the buyer, the lender, the realtor, even the title company) in an effort to prevent the kind of appraiser-lender collusion which was required in many mortgage fraud schemes.

Time was, when a buyer wanted to purchase a home the buyer's morgage lender would pick up the phone and order an appraisal directly from an appraiser with whom he had a good working relationship. Appraisers, of course, cultivated those relationships in many ways. Appraisal turn-around time was usually 3-5 days and appraisals cost the consumer about $350.

Since May 1st appraisals must be ordered through an intermediary - an Appraisal Management Company (AMC) whose sole purpose is to assign the appraisal to the next appraiser in line. Appraisals now take 7-14 days to complete.

With several weeks of this system under their belts, appraisers are now putting together their own Appraisal Management Companies to try to get back some of their lost income. (AMCs charge the appraiser $100 out of every $350 appraisal. How would you like to take a 1/3 federally-mandated pay cut?)
The original intention was to have an independent AMC assign appraisals blindly to the next of several dozen appraisers on a rotation list. a) this is a pretty socialist way to do things, and b) it means you don't know if your appraiser is a 15-year state-certified veteran or a 3-month newly-licensed know-nothing from two counties away.

What we're seeing on the ground is that two or three appraisers are banding together to form their own little AMC. The banks and lenders with whom they've had good working relationships in the past can now choose to order appraisals through this new AMC and be assured of getting the same appraisers they know and love.

So what was accomplished by this federal regulation? Just another layer of fake bureaucracy.

And yes, you can expect appraisals to cost the consumer $450-$500 in the very near future - and increase of 30-40%.

Monday morning I attended the Economic Forecast Breakfast hosted by the Salt Lake Board of Realtors at the Little America Hotel.  700-odd realtors and a newspaper reporter were in attendance to listen to Representative Rob Bishop and Professor James Wood from the Bureau of Economic & Business Research at the UofU Eccles School of Business tell us how bad things are and how really bad they're going to get.

Yesterday the Salt Lake Tribune published an article about the event: http://www.sltrib.com/ci_11611462?IADID=Search-www.sltrib.com-www.sltrib.com

Congressman Bishop was clear and convincing on why he had not voted for the bailout or for the stimulus package - and funny,  "It started with the Treasury Secretary telling us to just give him the money and go away.  Then they kept telling us the world would end if we didn't pass the bill by Friday.  But it didn't pass, and the world didn't end.  Then they told us we had to pass it before the financial markets opened on Monday, but it didn't pass, and again the world didn't end.  Pretty quick I started to not believe what they were telling me."  He also made a very convincing case for why tax  cuts work better than government spending (for one thing, there's less cash out of pocket...).  In the end Rep. Bishop was optomistic.  He seemed genuinely pleased with the willingness of the Obama administration to work with both parties, and felt that a better bill would come out of the Senate.

Dr. Wood, who spoke first, was more disturbing.  Dr. Wood specializes in construction and housing industry issues and has addressed the realtor community many times in the past.

He felt, absolutely, that we are going through the worst recession in Utah in over 50 years.  He said that the construction industry hasn't contracted this severly since WWII.  2007-2008 we saw the most dramatic drop in home sales in the last 40 years.

Most disturbing to me was his chart showing the change in Utah employment month-by-month since October 2007.

Still, Dr. Wood's forecast was similar to what I have been saying for the last 2 years:  we'll see bottom in 2009 and will start to level out in 2010.

It's been interesting to me to read the comments online for the Tribune article.  Many of the commenters have blamed realtors for the market run-up in 2005-2006!  Strangely enough, in 16 years I have never had to talk a seller into listing their home at a higher price...

Selling a house is just like selling a used car or a used bicycle, for that matter.  The seller has an opinion of price, the realtor has an opinion of price, even an appraiser has an opinion of price (opinion only - not information sent from on high), but the ONLY opinion that matters is the BUYER'S opinion.

It is only ever the buyer who makes a decision to purchase a home.  Could any realtor talk you into buying a home you didn't want?  A realtor's legal and ethical obligation is to work in their client's best interest - whether I am working for a buyer or a seller my job is to get my client the best possible price we can possibly negotiate.

Remember, real estate is a supply and demand market.  In 2005-06 when home sales were at their highest some parts of town had literally 2 weeks of active inventory available for sale - if there were 15 active listings in a neighborhood there were 30 under contract with buyers.  And guess what, lack of supply drove prices up.

That same neighborhood today has 5 months of active inventory - 82 active and only 17 under contract.  The good news?  Inventory levels have dropped dramatically from a year and a half ago.  3rd quarter 2007 active listings in SL County topped 10,500 when they should have been around 7,200 - 45% higher than they should have been.  Back then that same neighborhood had 11 months of active inventory.  And, not surprisingly, prices declined as inventory levels rose.

Truly, things are better than they have been.  31% of the active listings in SL County are now selling - up from 23% a year ago.  (At the peak, in 4Q'05, 71% of listed homes sold.)

The national news scares everyone, but Utah is just, as always, behind the curve.  Parts of the national market are starting to improve.  Utah's housing downturn will be shorter and shallower than the rest of the country.  Most of our homes were purchased by people who actually lived in them, not by investors.  The national real estate bubble popped in 2005, our market didn't downturn until 2007, so the national recovery effort has a jump on us.

Don't worry.  It'll be good.  Buy a house - get a great deal and a great interest rate.  Raise your kids.  Be part of your community.  In 3-5 years everything will be different.

Have you ever watched Antiques Roadshow?  You know they often say, "This is a beautiful piece of antique furniture worth $10,000.  Unfortunately, if it had it's original finish it would be worth $100,000!"

Well the price difference isn't as dramatic, but believe me, buyers will pay a premium for an older home with it's original woodwork intact.

Original gumwood, a common trim wood in bungalows built in the 1920's and 1930's, had a varnish that often mellows to a dark orange finish.  Please don't strip the gumwood!  The color is all in the varnish, and stripped gumwood looks pale, the grainlines lost with the color of the varnish.  Straight grain fir is another trim wood that was common in early Salt Lake construction.  Nothing is more beautiful that lustrous, naturally finished straight-grain fir - though being as soft and open grained as it is, it is often difficult to strip once it's been painted.

Mahogany is another trimwood you'll occasionally see in older homes, and, if you're lucky, you may even find a home with quarter-sawn oak trim.

I've seen old homes with quarter-sawn trim boards 14" wide - imagine the size of the old-growth oak that provided that board!  Modern quarter-sawn oak boards which are wider than 4" are always two or more boards glued up together to make up the wider dimension lumber.

Oak, particularly old oak, is a very hard wood, and is well worth the effort to strip and refinish.  But please, oak is not oak - please don't mix quarter-sawn oak with straight grain plain-sawn oak (often used in kitchen cabinets in the 1980's and 1990's)!  Quarter-sawn clear (without knots) oak is very expensive, but plain-sawn oak will stand out like a sore thumb against quarter-sawn.

If you're remodeling an historic home, it behooves you to try to match the existing trim - both in style and in type of wood.  It is amazingly jarring to walk into a room where the dimension, style, and material of the door, window, and baseboard trims are different from the rest of the home.  Buyers will notice, even if they can't put their finger on just what is wrong.

Remember, buyers who are drawn to older homes are giving up master bathrooms, walk-in closets, and thermal windows for a reason - they're willing to put up with the inconveniences and discomfort of older homes for the character, the charm, and the craftsmanship that can only be found in vintage homes.  Strip the home of those features and you are left with just the inconveniences and the discomfort.

As we wind down for 2008 and prepare for 2009, let's talk about the cycle of the real estate year.

Around here January can be one of two things:  clear and crisp with snowstorms rolling through every few days, or DREADFUL with two or three weeks of damp, dark, depressing inversion.  That's when you drive up to the outlet stores in Park City just to make sure the sun is still in the sky, and seriously consider moving to Summit.

Most of the general public assume that the 'spring' selling season for real estate begins in April or May, when in truth, if the weather is good, it starts as early as mid-January.  As a seller the earlier you list your home for sale, the less competition you will have.  The early spring market (by which I mean January-February) usually has a fairly stale selection of listings left over from the fall and winter.  The further we get into spring the more listings come on the market and the more competition there is for a buyer's attention.  By late March inventory levels are usually at their annual peak.

Surprisingly, buyers don't wait for school to get out to start house hunting.  Historically, the majority of buyers are in the market from February through mid-April.  By mid-May the rush is usually over.  By the second week of June when school gets out everyone is off on vacation, and July is just too hot and too busy with parades and family reunions.

By the first of August, buyers are again thinking about looking at homes and we begin our 'fall' market.  This lesser version of spring typically runs from the beginning of August through mid- to late-October.  At the end of October daylight savings time kicks in and it's pitch black at 5:30pm, then it's Thanksgiving, then it's Christmas, then it's New Years, and then it's January again.  The nice thing about buyers who come looking over the holidays is that they're deadly serious - no one moves in December unless they absolutely have to.

Park City and the Cottonwood Canyon resorts, of course, are the reverse.  The holidays are when everyone falls in love with Utah and shops for a ski condo.  Still, those shoppers often don't turn into buyers until spring - after they've had time to make a considered decision.

So, start preparing for spring now!  Too late to put in bulbs, but be prepared for all those real estate signs to pop up at the same time as the tulips.

One of a realtor's passtimes is to wander through new construction (or newly remodeled) homes and try to determine what will be the lava rock of the day.  My vote recently has gone to dark green carpet, dark green granite, concrete countertops (only ever seen one that was decent) and, I'm sorry to say, knotty alder cabinets (can't wait to see them in 10 years when the knots are all full of kitchen grease and built-up dust...).

Today my complaint has to do with remodeled homes.  So many of our lovely old Sugarhouse bungalows and Tudors have been ruined by young men with too little respect for classic style and too much time watching cable television.  So, if I may vent for a moment:

Subway tile, that long rectangular white or off-white tile often found in bathrooms and kitchen backsplashes and used on the walls of the New York subway system, is NOT supposed to have a noticable grout line!  PLEASE DO NOT USE SPACERS when installing subway tile!  In fact, modern subway tile comes formed with little tabs that are intended to take the place of spacers.  Subway tile should have just a knife edge of space between each tile.  And please use white grout!  I'll gag if I see one more house with big wide dark gray grout lines between the subway tiles.

Of course, the old original subway tile, like the old original porcelain floor tiles (hexagonal, basketweave, or otherwise) were thick flat-surfaced tiles with sharp square edges.  Modern tile has that slight bevel to each edge and the corners are slightly rounded.  I'm sure this makes them easier to produce and certainly easier to install.  You have to admire the craftsmanship that went into installing the old tile - run your hand over those old surfaces and wonder at how they were able to create such a smooth flat surface.

This time of year everyone takes a look back.  And this year everyone in real estate has had the time to take a good LONG look back.

Anyone who knows me knows that I'm a statistics girl, and it's been pretty interesting to take a closer look at the numbers this year.

In 2005-2006 our local real estate market appreciated almost 30% in just 10 months.

That summer of 2006 inventory levels in Salt Lake County climbed to unheard of levels - 16% higher than they should have been.  The general assumption was that most of the overstock was generated by casual sellers trying to take advantage of the upsurge.  Of course, the glut of inventory and ‘let's make a killing' prices simply drove buyers away.

By the fall of 2006 we'd started to advise clients to price their homes aggressively and get while the getting was good.  Real estate is a supply and demand market, and with supply at record highs and a declining demand, we felt prices would soon begin to drop.

Around the 3^rd week of May, 2007, the real estate bubble in Utah popped.  Unfortunately, it's the sort of thing you only realize in retrospect - there was no audible "POP" to cause us to sit up and take notice, but by the end of the summer we could tell.  One of the side benefits of doing so many transactions is that you can feel the boat rocking beneath you.

By the end of 3rd quarter 2007 inventory levels in Salt Lake County were 45% higher than the historic high for any previous 3rd quarter, and the number of buyers was at its lowest point since 2004.  This unfortunate inventory problem was exacerbated by the mortgage industry meltdown which began to make itself evident in August, 2007, when Countrywide - who was writing 1 of every 5 mortgages in the United States - got down to 11 days of working capital.

During 2008 our market has been largely in a holding pattern.  Inventory levels have declined, though they're still 10% higher than they should be, and the number of buyers has continued to dwindle. Prices have dropped, more in some neighborhoods than others.  We're beginning to see a number of short sales and foreclosures.  Everyone is concerned about job security and the future of the economy, and everyone is being careful in how they spend.

So, is there a silver lining?

Interest rates are around 5%.  If your mortgage is at 5 ¾% or higher, consider refinancing!

Utah never experienced the kind of real estate investor activity that places like California, Florida, Arizona, and Nevada did, and our economy is far more sound.  We fully expect that our downturn will be shorter and shallower than the rest of the country.  At this point, we're pinning our hopes on the spring of 2010 for a turnaround, though it may take a couple more years to bring prices back up.

If you ARE in a position to purchase a home, it's hard to imagine a better time.  Prices have dropped, sellers are negotiable, and loans are available for qualified buyers.  Just like the bubble bursting at the top of the market, it's hard to identify the bottom except in retrospect.  Any purchase you make during 2009 is likely to be a good buy.

Call and ask about our commission rebate program for buyers!

The government is making some concrete efforts to ease things for buyers and sellers:  first-time homebuyers can receive a $7,500 tax credit if they purchase prior to July 2009, and sellers who have to negotiate a short sale with their lender will no longer owe income taxes on the write-off.

If you do have to sell your home, at least you have the option to sell without the burden of a 6% commission.  Our low flat-fee commission gives sellers the ability to offer better deals to entice buyers.  Because marketing times are now so much longer, many conventional real estate companies these days are actually charging more - 7% or even 8% - to market a home.  You have to pay more because they're not selling as much?  Honestly.

So try to stay put for the next couple of years and, if you're able, maybe pick up a good buy on a rental property.  Either way, give us a call.  Overcoming assumptions has been our biggest challenge with Assist-2-Sell Professionals:  we really do provide full-service real estate brokerage, we really do charge a lot less than the usual 6% listing commission, and we really do give a commission rebate to buyers.  Seems simple enough, but we still run into people - past clients included! - who mistakenly think they're going to have to do some of the work.  In spite of the downturn, in 2008 our office has ranked consistently among the top 10% of Assist-2-Sell offices nationwide for sales volume.

We'll soon be offering our clients free access to RealtyTrac®, the largest internet search engine for foreclosed, bank owned, and pre-foreclosure properties.

‘While we breathe, we hope.'  On January 20^th change will finally come, and we hope for better times.  As Bob Dylan once said:

"Oh the seas will split and the ship will hit,

and the sands on the shoreline will be shaking.

Then the tide will sound and the waves will pound,

and the morning will be breaking."