Tips on making a low-ball offer a homeowner might just accept.

BUYERS the BEST situation to submit a low-ball offer:

1. Seller has reduced the price for the 2^nd time

2. Seller has reduced price within 4 weeks

3. Property has been on the market 4 months or longer

4. Seller bought 5+ years ago

5. Property needs cosmetics but not total rehab

6. Property is vacant and seller has moved on

One word of caution: It isn’t worth anyone’s time to submit a ridiculously low offer, often it just enrages the seller who then refuses to negotiate. If the property is priced close to market value then an offer of 8-10 % below asking is low-ball. Properties that are priced using the “I would like to see how much I can get” or “I need to make this much” method are better just left alone.

The WORST time to submit a low-ball offer:

1. Seller has not reduced asking price

2. Property is less than 4 weeks on the market

3. Open House is crowded

4. Property is priced slightly below market value already

5. You have been looking for awhile and the house is “the one”

Some examples would be:

1913 Green St #1 - Reduced from $725k to $575k; Reduced 5 times. On market since 6/21/2006 (I think they are finally close to market value now).

36 Strawberry St #26 - Reduced from $290 to $247k; Reduced 3 times. On market since 9/17/2007 (they have moved on and are motivated).

850 S. 5th Street - Reduced from $415k to $315k 299k; Reduced 9 10 times (now we’re talking). On market since 5/19/06.

Potentially Related Articles:
NY Times: Lowball Offers on the Rise

Technorati: Philadelphia real estate, Center City Philadelphia real estate, market conditions, low ball offers

posted by janice

Make no mistake we still are in a buyers market in Philadelphia and probably will be for some time. The housing market took a much needed correction after a number of years of unwise purchasing but unlike what the media would have us believe, a correction in the housing market doesn’t equate to a crash. Unfortunately, the ongoing negative news about the troubled areas in the U.S. has caused a ripple effect, with home buyers and sellers on a national level exercising caution before making a decision. This has caused an overall slowdown in the marketplace.

The National Association of Realtors says the US housing market showed signs of stability in February and existing home sales rose 2.8% nationally and up 11.3% in the Northeast, up for the first time in 7 months.

True, the numbers of homes sold in 2007 have dropped from the year before, but 2007 is still among the highest years on record, with numbers of sales for 2008 projected to be even higher than the levels seen in 2002. Inventory in the Philadelphia region still remains high but is moving in the right direction. This equates to good news for buyers who have more homes at more price ranges from which to choose.

Philly Median Home Prices:

        • The median sold price for 2006 was $180,503
        • The median sold price for 2007 was $185,204
        • This represents a 2.5 % increase in price (nationally there was a decrease of
           8.2%)

Philly Sales Volume of Houses Sold:

        • There were 17,667 homes sold in 2006 for a sold volume of $3,188,950,036
        • There were 15,735 homes sold in 2007 for a sold volume of $2,914,195,066
        • There were 1,932 fewer homes sold which equates to a decrease in sold volume
          of 8.6% (nationally 23.8%)

Summary:

        • Philly has faired much better than the national average both in median sold home
           prices and in volume of homes sold
        • Housing demand in the Philadelphia region is down from 2006 but still relatively
           strong
        • There is a smaller percentage of supply in Philly than there is in the majority of
           the country

Houses that are priced consistent with market guidelines are attractive to buyers 

        • Attractive listings increase Buyer demand
        • Increased demand reduces supply
        • Fact-based pricing creates a healthy real estate market

Potentially related website:
Search All Philadelphia Homes For Sale

Technorati: Philadelphia real estate, Philadelphia median home price, Philadelphia home sellers, Philadelphia home buyers

posted by janice

What are absorption rates… and why are they the best indicators of Market Performance?

Absorption rate is the average number of homes sold per month over a particular period of time and how long it will take the homes that are on the market to sell. Absorption rates are a great means of tracking market performance and predicting trends. Although they are usually used to indicate overall market performance they can be just as powerful when tracking sales by price range or by neighborhood.

Buyers market, sellers market or neutral market?

The amount of inventory determines which way the market swings. A neutral market is 6 months of inventory and anything less than that is a sellers market. Conversely, an inventory of more than 6 months is a buyers market.

What do absorption rates mean to a buyer?

Absorption rates can help a buyer to understand market supply and demand and this can be helpful when crafting his/her offering strategy. The longer a home has been on the market and the more competition that it has in its price range, suggests a lower offering strategy and a greater possibility of increased reduction off asking price.

What do absorption rates mean to a seller?

Absorption rates help a seller understand how long it might take a home to sell. They can also assist the seller in determining their pricing strategy. The most desirable home in a price range always sells first. If a seller wants to sell quicker, they want to have the most desirable home in a price range… even if that is one price range lower.

Disclaimer:

Absorption rates are a great tool that can be used by either a buyer or seller to understand the real estate market and to be in a better position for success. But they tend to fluctuate dramatically by neighborhood and by price range. Absorption rates are more accurate if calculated in smaller segments. A good example is the rate for Fishtown is 6.23 weeks and the rate in Queen Village-Pennsport is 4.33 weeks but the above rate for all of Philadelphia is 11 months! If you would like to know the absorption rate for your neighborhood, send me an email and I will publish the rate.

Potentially Related Posts:
The State of Philadelphia Real Estate
Philadelphia Forclosure Rate

Technorati: Philadelphia real estate, absorption rate, Philadelphia real estate trends, market conditions

posted by janice

The tallest building in the Western Hemisphere and the second-tallest building in the world is planned for the parking lot at 18th and Arch Streets in Center City. Walnut Street Capital, a Philadelphia development company headed by Garrett Miller and a pension fund from Washington State are joining forces to develop the project. This type of funding enables the project to skit around the current credit crunch that is starting to put a damper on commercial projects. With the funding in place the obstacles ahead include the need for zoning adjustments and attracting prospective tenants to occupy the office part of the building.

This development would fill a hole in a critical block of Center City and help expand the Central Business District  filling the emptiness between Logan Square and Market Street. The design of the building will have a mix of uses and design elements that try to create vibrant public spaces to be used at all hours.

The American Commerce Center would be constructed to meet the U.S. Green Building Council’s LEED gold certification and the developer anticipates, if approvals are in place, breaking ground next summer and finishing it by 2012.

FAST FACTS:

     Website: American Commerce Center

     Location: 1800 Arch St.

     Height: Office Tower-1500 feet (525 feet higher than the Comcast Center)

     Usage: retail, hotel and office space (even a movie theater)

     Cost: $800 million, 2.2 million square feet

     Architect: Kohn Pedersen Fox

     Developer: Walnut Street Capital

     Groundbreaking: Summer 09′?

     Features:

        •  1500′ Spire
        •  26 Story Hotel / 5 Star (300 rooms)
        •  2 Roof Gardens (473′ and 6th Floor accessible to hotel guests)
        •  3-6 Stories of Ground Floor Retail along Arch St with a public garden
        •  Underground Parking (383 spots with dedicated bicycle parking)
        •  LEED Gold Certified

Impressive news. This is a great day for Philadelphia. Check out the official renderings and more information on philly skyline.

Technorati: Philadelphia skyscraper, Center City, American Commerce Center, tallest buildings, Philadelphia real estate

posted by janice

Here’s another reason to love Philadelphia: according to the City Planning Commission, daily off-street parking is both “ample” and “cheap.”
Occupancy rates are only about 80%, and availability should continue to cheerily rise with demand so not to worry, friends; when you need parking space for your 2010 Cadillac hybrid, it will be there.

Why doesn’t this cheer me right up?

Because as a Realtor, I’m always trolling for a short-term space, which the Commission admits is “disproportionately expensive” compared to other cities. Typically, an hour’s parking costs more than half as much as a full day.
Plus, it takes me a few precious milliseconds to drive into a parking lot.
What I want, dear reader, is a nice cheap parking space right smack at the curb.
But sometimes, even in my favorite city, you can’t always get what you want.

PS. You can pay your parking tickets online, it’s almost painless.

Technorati: Philadelphia, Center City, Philadelphia parking, parking problems

posted by carolyn

There is a style of house for everyone in Philly.

The log cabin sits at the corner of Lawrence and Popular Streets in the neighborhood of Northern Liberties. Built on four lots by artist Jeff Thomas in the 1980’s with a truckload of logs from West Virginia. Thomas’s inspiration for the home came from the “back to the land” movement of the 1970’s.

It is a two story cabin composed of one room on top of another with a steel chimney pipe rising up through the roof. The cabin is surrounded by a low stockade fence, stacks of firewood and a stand of walnut, locust and black cherry trees. Across Lawrence Street where once there was nothing but boarded-up buildings, expensive condos and rehabbed houses stand.

The cabin seems out of place until one remembers that in the 1980’s Northern Liberties was a remote section of the city, filled with abandoned row houses and factories. Most neighbors have come to accept the cabin and some love it. It stands today as a testimonial to the artists who first took over the buildings and established the area’s eclectic ambience.

Technorati: Northern Liberties, unusual houses, log cabins

posted by janice

By now, you’ve likely heard that mortgage delinquency and foreclosure rates are rising rapidly but Philadelphia foreclosures are far fewer. Foreclosures in the Philadelphia area dropped by 32 percent last year, according to RealtyTrac. The California company, which tracks foreclosures, released its Year-End 2007 Metropolitan Foreclosure Report, ranking the nation’s 100 largest metro areas by percentage of total households entering some stage of foreclosure. Philadelphia was 79th, with a foreclosure rate of 0.492 percent of households.

The scenario is not one of doom and gloom as buyers are out there and properties that show well and are priced correctly are moving. Days on market are down slightly at 67 days average for the month of February and should shorten as spring approaches.

Technorati: Philadelphia homes, foreclosure, mortgage

posted by janice

Having trouble selling your Philadelphia “fixer-upper”? Think out of the box and try creative marketing. Make sure your sound is on when you watch this video.

Technorati: real estate humor, handyman special, fixer upper, short sale

posted by janice

Interpreting housing statistics.

Sure, you know it. But you forget. So let me remind you that numbers can lie sometimes, and words can lie all the time, so please don’t take every housing statistic you read at face value.

Let’s say, for instance, that you’ve just read that “housing prices in this neighborhood have plunged 2%, the greatest drop since 2001.” Before you go hiding under the bed, ask yourself : is 2% really a plunge? If a 150-pound woman lost 3 pounds, would she shriek, “Yay! My weight is plunging!”? No, she would not. But reporters happy to hype up a story use the ol’ plunge-and-soar verbs all the time.

And that’s another thing. What area are those statistics talking about? National home prices are less meaningful if all you care about is that one townhouse at the corner of 3rd and Market. Figures that include both condos and single family homes, when all you’d ever want is a condo, aren’t so relevant to you. It’s also wise not to over-react to the “since such-and-such-a-date” part of a statistic. It adds some dimension to the numbers, but it can also be stretched to the point of absurdity, as in “Mom, I’m starving, it’s 1:30 and I haven’t eaten since lunch.”

Keep your sense of humor. Hang on to your perspective. Yes, these are challenging times in the housing market, but they’re made worse by media slants, twists, turns and melodrama. Seen a good example of it lately? I’d like to hear.

Technorati: philly real estate, market statistics, housing statistics
posted by carolyn

For most of recorded history, sellers got all the agents and buyers jumped without a net. But since the late 1980’s, Buyer Agents have also become popular.

86% of buyers have Buyer Agents. So should you.

You need your own representation when you’re talking money. And experience has shown us that buyers who don’t have a Buyer Agent end up regretting it at the worst possible moment.

Any REALTOR® or agent can act as a Buyer Agent for you, but we have taken it one step further by earning our ABR designation (Accredited Buyer Representation). Only 13 % of agents worldwide have taken this extra step.

Buyer Agents costs you nothing. And gain you everything.

Usually, the Buyer Agent is paid from the seller’s commission. But he or she is legally obliged to place the buyer’s interests above all others.  Here’s what you should expect, and we deliver:

*Undivided loyalty

*Respect for your requests

*An explanation of all paperwork, so you understand everything you sign

*Coordinating work with third parties like mortgage brokers, insurers and inspectors, so you stay on schedule

*Objective advice, including honest pros and cons, so you can make up your own mind

Buyer Agents. Don’t leave your old home without one.

Technorati: buyer agent, philadelphia home buyers, accredited buyer representation