JCKC Realty

Real estate office located in Sturbridge, Massachusetts. Articles and blog posts located on the Internet.

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Finding Buyers When Selling A Home

finding buyers

The following guest post is about finding buyers by Brabble CEO Patrick Mackaronis of New York City.

Prevent one’s biggest investment from selling at a lower market value by learning about who may purchase the home next. In addition to traditional home staging practices, cater staging to cultural backgrounds. Here’s some information on finding buyers.

There are several often unspoken rules in real estate. It’s important to educate oneself on the beliefs and superstitions of other cultures and prevent offensive situations. There are adjustments that homeowners can make on their home that will help avoid cultural embarrassment, and in turn expand their buyer pool. However some things will not be able to change, but sellers can keep these practices in mind so they know what to expect.

Finding Buyers: Home For Sale With No Offers

For example, a house is for sale. It’s been on the market for 60 days, there were ten showings and no offers. The owners followed their realtor’s expertise and dropped the price 10% from the original asking price to $135,000; and they even planted a St. Joseph’s statue in their front yard to make the house sell, which is a superstition Kelley Chambers explores in her Oklahoma City Journal Record article, “New Realtor Store in OKC Stocks Statuettes That Some Say Can Help.” The backyard is lush and green from bright southern exposure, an ornate formal dining room boasts regal crown molding and the King Kong-sized master suite above the garage is to die for. The address is 4 Cul-De-Sac Court. The owners are doing everything right, right?

As a melting pot, America is full of buyers from other fascinating cultures with strong beliefs. These buyers follow specialized beliefs when selecting the right house to make their home. Homeowners may be unintentionally offending buyers of other cultures and minimizing their potential buyer pools. In the description of the home above, the sellers are doing everything wrong.

The number 8 in some cultures is a sign of luck, prosperity and eternity as Janet Farricelli explains in her article “Reasons Behind Chinese Superstitions.” If a home is listed for $190,000, why not change the listing price to $188,888? A buyer looking for their forever home may see the 8s as a sign of good fortune and the slight adjustment could mean good fortune for the seller too. Another way to incorporate the number 8 is through buyer incentives such as an $888 credit at closing or eight $80 gift cards to home improvement, furnishing and electronic stores.

Finding Buyers: Cultures of Home Buyers

The southern exposure the backyard is thriving on in the example above means that the home is facing north. Unfortunately, some adjustments are entirely out of one’s hands. A number of cultures consider homes that face north bad luck, such as Filipinos, Indonesians and Chinese as Jeffrey Hayes outlines in his “Feng-Shui and Qi Gong” piece at FactsAndDetails.com. If the home is a trailer, it may be more feasible to accommodate this cultural hurdle!

The banquet-sized dining room that is always admired by guests happens to be below an upstairs new bathroom with a low-flow toilet and a smooth river rock shower. People of certain cultures, like the Chinese, have the belief that the room above a dining room cannot contain a toilet. No matter how grand the room may be, this is another feature that would be difficult to change, but Master Feng Shui Consultant, Kathryn Weber’s advice is helpful. Weber goes into detail about this in her Red Lotus Letter, “If a toilet upstairs is over a kitchen or dining room, try to move the table or discontinue using the bathroom.”

Over the garage, the tremendous master bedroom is a happy retreat. Room enough for a California King-sized bed and a sitting area. There may even be a Carrie Bradshaw-sized walk-in closet. Some Filipinos are against the master suite being above a garage, and if they learn this first, these buyers will automatically rule out the home without even setting foot in it. A way to remedy this is to market it as a bonus room as long as there is another bedroom of master-suite quality. This is common as many newer homes have two master suites.

The address being 4 Cul-De-Sac Court sounds harmless enough. There are many things one can change about a house, but keep the first three rules of real estate in mind (Location! Location! Location!). The address cannot be changed. Having a home on a court is a feature most buyers find attractive due to less traffic noise and a safer area for kids to play with a slower speed limit. There are some buyers who want a well-traveled, double yellow-lined road for their home, typically if they have a home business and keen on having street signage and a convenient, easy-to-get-to locale. Then, there are buyers from other backgrounds and cultures that may not mind a quiet road or a high-trafficked one, but the number of the house will be important to them. The number 4 is very unlucky in some of the world’s cultures, including Filipinos.

Finding Buyers: Making Changes to a Home For Sale

If homeowners understand the importance that buyers’ beliefs hold, sellers can empathize and accommodate these cultures. Always remember, a home is only worth what someone is willing to pay for it. Granted the majority of buyers may not follow strict cultural rules; it’s best to make an effort to accommodate all potential buyers, for their benefit and the sellers’!

Rent-Subsidized Tenancies: Pros and Cons

rent-subsidized tenancies

The following article is a guest post by New York City’s real estate expert Alex Vasser on rent-subsidized tenancies.

As discussed in Rent Subsidies Make Tenants Attractive, there are various federal and state government programs that provide rent subsidies to individuals and families whose income is below specific levels. Accepting tenants who receive this type of rental assistance can be a good way for landlords to fill or prevent vacancies, particularly in areas where unemployment is resulting in more rental units than tenants.

Nonetheless, along with the positives there are negatives involved with having a tenant whose rent is subsidized.

Rent-Subsidized Tenancies Provide Guaranteed Payment, Motivated Tenants

These are some of the benefits to landlords in having tenants who receive rental assistance:

Guaranteed payment. In programs such the U.S. Department of Housing and Urban Development’s Section 8 housing voucher program, the amount subsidized by the government agency is mailed directly to the landlord each month. In other words, the landlord is guaranteed payment of all or part- depending on how much of the rent is subsidized- of the monthly rent. The remaining portion is usually in an amount that the tenant can readily afford; therefore, a landlord is usually able to collect the full rent each month.

Motivated tenants. Competition for rental assistance can be tough. In some areas, the government agency that administers the rental assistance program accepts new applications for a limited period each year. As a result, those who qualify for a subsidy tend to do what they must to hold on to it. For a landlord, this means that a tenant with a rent subsidy has reason to fulfill his or her obligations under the lease, including paying the unsubsidized portion of the rent on time.

Competitive rental amounts. HUD sets the fair market rental amounts each year in metropolitan and non-metropolitan counties. If the rental market of a particular area has deteriorated after HUD has sent its rates, a landlord may find that the amount of rent that a rental assistance program is willing to subsidize exceeds what other landlords are accepting.

Inspections, Frozen Rents

These are some of downsides of having tenants who receive rental assistance:

Yearly inspections. The agency that administers the rental assistance program will schedule yearly inspections of the rented premises. The inspections may turn up conditions that the landlord will be obligated to remediate if the rent checks are to continue uninterrupted.

No rent increases. A landlord may not be able to raise the rent for years because the government agency that provides the subsidy may decline to pay an increase, the tenant may not be able or willing to pay it, either, and the landlord may not want to have to find another tenant.

Fluctuating subsidy checks. Because the amount of a subsidy depends on the tenant’s income, the amount of the check that a landlord receives from the government changes from time to time when the tenant’s income changes. This means that the landlord will have to go to the tenant for the difference if the subsidy is reduced.

Instability. In a depressed rental market, tenants may want to change homes, knowing that they can get a bigger place for the same subsidy.

The Bottom Line

Ultimately, landlords must determine their own comfort levels, always in reference to their real estate investment plans. They may ask themselves these types of questions:

  • Do I want guaranteed rental payments each month?
  • Am I willing to rent to low-income families and individuals? If not, why?
  • How likely am I to find other tenants for my rental units?
  • How long am I able to keep a unit vacant while looking for a tenant?
  • Can I take in stride the yearly inspections required by a rental assistance program?
  • Will renting to a tenant whose rent is subsidized help me reach the goals in my real estate investment plan?

Profitability: Making Money In Real Estate Now

profitability

The following is a guest post on profitability in real estate by Phoenix, Arizona’s Avky Inc.

Rehabbing and selling a property in today’s real estate market can be done and it can also be profitable. However, rehabbing real estate and holding it for rental purposes can be a financially and emotionally rewarding experience. It can also become the experience from hell if not done correctly. There are tricks of the trade that will allow you to maximize your profits and minimize your headaches.

So, you have already bought cheap a property. You have already saved on Materials and you hired yourself to complete the project. Very good!! Now let’s look at the steps to create a win/win rental situation between your tenant and yourself. Please remember our goal is to make money in real estate right now!! Also remember that saving money is moving it to the bottom line. So saving money is making money in a sense. Let’s get started.

  1. Profitability: Pictures And Videos

I’m sure you’ve heard that a picture is worth a thousand words. I have a personal saying. A good picture is worth two thousand words and a phone call. What I’m getting at is that you need to take quality exterior and interior pictures of the rental property. Your pictures should ideally be in a common format and size for different uses. A good overall format would be .jpg and the size of 640×480.

The reasons for the pictures are two fold. The first reason is for print and online advertising. The second would be to document the condition of your rental property prior to renting the property. This protects you as well as your tenant. I’d also suggest doing a walk through with a video camera with the time and date stamp activated.

  1. Profitability: Advertising – Free

Advertising is a key part of your real estate business. How is anyone going to know that you have a rental property available, if you don’t tell them through advertising? As you know there are various forms of advertising. I personally like to use free advertising for the obvious reason. It’s free… There are literally hundreds, maybe even thousands of free classifieds ad sites where you can place your real estate rental ads. You can also post your real estate rentals on facebook, twitter, digg, etc… Be creative, use your quality pictures, and write good and informative ads. You will get great results.

  1. Profitability: Tenant Screening

This is a very important step in the process. If you short cut in this step it could potentially cost you a lot of time and money, by having to pay to have a tenant evicted. You should create a tenant screening system for yourself. This system should be performed the same way each and every time. I don’t care if it’s a referral from your best friend. Do your tenant screening process the same all the time. It protects you as the landlord/property owner and the perspective tenant at the same time.

I suggest using a service that will provide you with a perspective tenants background records, public records and prior eviction status. This will give you a snap shot of who your perspective tenant really is. When you do your reference checks, make sure you call the landlord prior to the current landlord.

The reason for this is because the current landlord will say good things about a dead beat tenant that they want out of their property. The landlord prior to the current landlord has nothing to lose by telling the truth.

  1. Profitability: Preparing Your Lease

Congratulations, you’ve found an acceptable tenant for your rental property. It’s time to prepare the lease and riders for your new tenant. As with the tenant screening process this step is very important. If you’re not comfortable preparing your own lease and riders seek legal advise. However, it’s not difficult at all.

The lease is the longest document. There is no need to re-invent the wheel on this one. There are plenty of pre-printed forms at your local office supply store. You can also find them online in PDF form fill formats. Make sure your lease is appropriate for your state and/or city. There may or may not be other riders that need to executed along with the lease. Again, your state and/or city will determine this.

One way to increase your bottom line is to give your tenants performance incentives. When I structure my leases I add an extra say $10.00 to the lease amount. I tell the tenant if they pay their rent on time that they can deduct the $10.00 from the rent.

I know what you’re thinking. Why would I deduct $10.00 from the rent if they pay on time? Why am I rewarding them for what they are supposed to be doing anyway? It’s simple. It works and the rent less the $10.00 is your true rental amount anyway. You get your full rental amount each month and on time.

The tenant feels like they’re getting a discount. It’s a win/win situation for both of you. If you follow these simple steps you will be on your way to making money in real estate right now.

Greek Real Estate: Before Or After January 2016 Increase

greek real estate

The following article is a guest post on Greek real estate from Avky Inc co-founder Aleksandr Vasser, of Phoenix, Arizona.

Today, individuals that are interested in buying real estate in Greece are faced with a dilemma: Whether to purchase a piece of property immediately before the property’s objective value is increased as is expected after January 2016, or further wait with the hope that real estate prices will decrease in the near future?

The objective value of a piece of property in Greece relates to the taxable value that the Greek revenue department assigns to a piece of real estate. The market value is the actual price paid for the real estate. The objective or taxable value is usually equal or less than the market value (at least up to now) and may start from 10% and reach up to sixty percent of the market value. The remaining amount (the market value minus the objective value) is a gift usually to the black economy and is strangely accommodated (at least up to now) by both the revenue service and the ministry of finance.

Greek Real Estate: Purchase or Postpone?

In any part of the world, housing-related purchases are considered high risk purchases not only because of the large sums of money needed, but because of the possibility of cognitive dissonance setting in after the purchase. This is one strong reason that individuals consult with both family members and close friends, and also with reference groups and market experts such as real estate agents.

As far as Greek real estate goes, one current train of thought suggests that it is better to purchase before the year’s end, thus being spared from the incoming increases in the objective value, or taxable value of the piece of real estate in question.

Another train of thought advises buyers to wait with the logic that the increases in objective value will slow the market even more, and the resulting fall of real estate prices will be more than the expected government objective value increases, thus rewarding the patient buyer with a net gain in his or her purchase.

Greek Real Estate: 2015 Real Estate Price Changes

According to the Greek Central Bank, the first half of 2015 has seen Greek real estate prices fall about 6% in the Athens area with a topple of more than 10% in prices of newly built condominium apartments in certain parts of the Athenian basin; areas such as Patisia, Menidi, Sepolia, Kallipoli, Metamorfosi, Nea Makri, Ilion, Neos Kosmos, and Dafni.

Posh areas such as Agia Paraskevi, Brillisia, and Marousi on the other hand, according to Triad Real Estate, have experienced a 5% fall in newly-built condos, and in 20 or 30 year old flats, can reach a discount of 20 to 25%.

Greek Real Estate: Prices Will Eventually Rise

What will happen in the future as far as Greek real estate prices go is very unclear since the situation in the country, although improving, is still quite volatile. There will be ample opportunity for bargains for those that keep their eyes open and consult with qualified professionals and competent brokers, and there will be lost opportunities for those focusing in the wrong direction.

Regardless of which way the real estate market goes, one thing for certain is that prices will at some point pick up, since the amount of available property in Greece is and will always be limited.

Flipping Houses: Tips In A Slow Market

flipping houses

The following is a guest post on flipping houses by Avky Inc co-founder Kyle Uchitel.

Flipping houses used to be pretty simple. Slap on some paint, toss some pansies in the yard and throw up a sale sign. With the slowing housing market, it isn’t that easy any more. People want more for their money and if the house has more, they want to pay less. Can people still make money flipping houses when the market is down? Yes, but they have to try a lot harder.

Flipping Houses: Reasons Houses Aren’t Selling

People who are sitting on a flip flop while other houses in the area are selling should take a hard look at why their houses are still on the market.

  • Are other houses in the area selling for less? Do they have added conveniences that the house being flipped can’t offer? The seller may need to drop the asking price or offer some sort of bonus, like a landscaping allowance, at settlement to give added value to the buyers.
  • Is the house ugly? While it is hard to see the fault in something that has been loved and slaved over, a hot pink house with lime green shutters will not warm the hearts of most potential buyers. Ask for opinions from realtors or that honest friend who is not afraid to say that a favorite dress makes the wearer look 10 years older. Then, be prepared to act on the advice that was given.
  • Is the flip a two bedroom home that is located in a family neighborhood? If the flippers can’t add a third bedroom, they will have to be prepared to wait and wait some more before they find a buyer.

If there doesn’t seem to be a reason the house isn’t selling and the sellers can afford to wait, they may want to talk to a realtor about other options. Some flippers are offering buyers a lease with option to buy until the market picks back up. Others are simply renting. There are even a few who are moving into their newly renovated flip and trying to sell the family home instead.

Flipping Houses: Additional Help for House Flippers

Investors who are right in the middle of a flip may be panicking as they look at the slow housing market. Some of them are cutting quite a few corners as they try to get out of the flip as quickly as possible. However, this could be an even bigger mistake, as potential buyers are frequently lost when their inspectors give them a laundry list of problems. Flippers who are trying to get a house renovated on a budget should:

  • Update electrical and plumbing systems.
  • Reroof leaky homes.
  • Tidy up landscaping.
  • Apply a fresh, neutral coat of paint.
  • Refinish or clean flooring.
  • Replace dirty or missing outlet covers.
  • Clean and maintain heating and cooling systems.
  • Update kitchen and baths. (If the budget does not allow for a complete overhaul, consider refacing cabinets and replacing the most outdated fixtures and appliances.)
  • Finish any renovations that have been started (or put the pieces that were taken apart back together.)

Kyle Uchitel can best be reached on Twitter at @kyleuchitel.

Real Estate Careers: Home Inspection, Home Staging, Photography

real estate careers

Real Estate Careers: Home Inspection

Home inspectors are an integral part of the Real Estate process. They require in depth knowledge of the home you are considering. An inspector can often make or break a real estate transaction based on the report that they provide. A home inspector is a solid option for real estate careers.

The requirements for inspectors vary from state to state and American Home Inspection Institute can link you to the various requirements in each state as well as in Canada. You will likely notice that many states including Canada currently have no guidelines for becoming an inspector. I am certain this will change in the future as the reliance on a home inspector becomes more and more commonplace.

Be aware that the American Society of Home inspectors is a fantastic resource and there site can direct you to the education training and resources that you require to become an inspector.

Real Estate Careers: Home Stager

The Home Staging profession has exploded quite rapidly onto the Real Estate scene. Its exposure on television has pushed it to forefront rapidly and the field seems continually growing. With this rapid expansion many design schools have sprung up focused on staging a property to its fullest.

Staging Diva, and Decorating Solutions are just a few of the training systems that have been set up.

A solid understanding of design will allow you to enter into this highly publicized field. Again there are no state or Canadian laws that regulate home stagers so anyone can technically become a stager.

Real Estate Careers: Real Estate Photographer

A Real Estate Photographer does exactly what you would think. They take pictures of your home. Obviously with some photographic training anyone can specialize in home photography.

Most agents take there own photographs so finding a niche in the market place can be difficult. Many photographers offer specialized packages for real estate.

These are just a few of the careers that professionals have taken advantage of in the Real Estate market place. Each career choice offers its own challenges and rewards. So good luck exploring your career options.

Rental Properties Paying For Themselves

rental properties

Investing in real estate rental properties is a dream many investors have, even if only to own their own home outright.

For those that wish to own rental properties, whether they be single family homes, office buildings, or land that tenants are welcome to build on, the process is often a slow one, starting with one home, renting it out, and working to pay down the mortgage as quickly as possible to fully capitalize on the money to be made.

Paying off debt and building a large base of equity is the key to establishing true wealth, and while the process can be slow, it slowly gets very fast.

Rental Properties: Before the Rich are Rich, They Acquire Assets

Assets are the key to wealth, but not just anything that can be listed as an asset, which is essentially any item that has value. When thinking of assets, think of income-producing property.

A $250 golf club is not an asset unless it’s helping Tiger Woods sink more putts from the fringe, and a car is not an asset in this sense unless it’s being used to create income, such as a taxi cab, limousine, or delivery van.

If it brings in money, or adds to one’s wealth, it falls into the asset category that will help investors grow their net worth.

Starting Small and Then Finishing Strong in Real Estate

There are some exceptions to investors starting small, such as those who have much guidance and a lot of money, allowing room for mistakes that someone investing with a middle class income cannot afford.

For the average investor, small, uncomplicated investments allow room for small, affordable mistakes, such as not having a 1,000 square foot home inspected again after repairs were supposedly done on the toilet. This mistake may cost some money, but it shouldn’t disrupt the entire event of growing serious wealth.

Over the course of time that it takes to pay down the mortgage on this home, many events will occur that will serve as a great education for a rental property owner, such as whether it’s worth it to allow small pets as a means of securing the non-refundable deposit and avoiding vacancies from shutting out a significant part of the market. After all, what does each vacant month cost compared to having carpets shampooed?

If an investor applies the rent to the mortgage in a strong rental market, such as a military town, and adds some money of his own to pay down the principle, it would not be hard to pay off the loan in 20 years.

Once this is done, it’s time to find another property.

Double Payments on a 30-Year Mortgage

Now that the first home is paid off, those looking to really become wealthy should buy a similar home in a similar neighborhood (in regards to rental properties).

Keep in mind that the renter of the new house will not be paying the mortgage alone. This time, both rents will be paying for one mortgage, resulting in the second home being paid off in under 10 years if there is a 15% vacancy rate.

When this process is repeated, the third home will be paid off in six years and the fourth in less than four.

At this point, the investments have accumulated over about 40 years. They can provide a comfortable retirement, but, also, they have formed a business that can be passed on, acquiring like properties to add to the holdings in just a few short years at a time.

This ample passive income can provide for some nice golden years. With the lessons that will be passed on to the heir of this fortune, a true empire can be established, and that is how the rich get richer with real estate.

Real Estate Agent Selection Process

real estate agent

When it comes to selling a home, it’s never wise to sell without professional assistance. A real estate agent understands the necessary procedures and have the proper knowledge to put the homeowner at ease while also making the most of the sell. Allow an agent to give the homeowner what he or she deserves. Sell the home at top-dollar price with help from an expert.

Real Estate Agent: Shop and Compare

When selecting a real estate agent, it pays to be a little inquisitive. Instead of making a random selection without a track record, homeowners are encouraged to “shake the tree” and ask around to gain more information. Consult with family members, friends in the neighborhood and friends in town.

It is very possible the people next door could provide a quality recommendation and even share a personal success story to reinforce the claim. It never hurts to ask if anyone has any positive recommendations or general suggestions.

Attend Real Estate Open Houses

If an agent is having an open house in the area where the homeowner’s house is located, then attend. Having an open house in the same area would logically mean the agent is familiar with the neighborhood or general location.

Those familiar with the houses in a given community already know the price tag for most homes. The homeowner can gain a wealth of knowledge by simply showing up and speaking with the agent on duty.

Choose a Respected Real Estate Office

Many times the generic brand provides the same ingredients at half the cost. Not the case when dealing with real estate agents. When it comes to looking for a quality agent, big offices and big names usually equal better resources and better deals. Homeowners are encouraged to “aim high” and consult with the most respected and well known agencies. Big offices equal more people and better service.

Interview Agents

One of the most critical steps in the consultation process is getting to know the actual agents. Homeowners are advised to set up interviews with the top candidates and simply ask them to sell his or her services.

Take important notes while allowing the agents to give the best sales pitch. Make sure everyone interviewed display proof that he or she is a licensed real estate agent. Sit back and let the agent describe his or her best plans for selling the residence.

When a homeowner is comfortable with the promises and money agreements, all roads are clear. The home selling process can commence.

Deed for Lease Program: Is this a Smart Move by Fannie Mae?

deed for lease

Fannie Mae created a Deed for Lease program that could allow homeowners, who default on their mortgage, to stay in their homes for a year as renters. This program does not allow the homeowner to reclaim any equity or ownership, they simply have the right to continue living in the home and paying a market rent. While the market rent issue will surely be debatable, there is a broader question- is this a smart move by Fannie Mae?

How does the Deed for Lease Program Affect the Homeowner?

Homeowners win in this situation. Their credit rating does not take the same hit as a pure foreclosure and they get to live in their home for a year, paying essentially what they can afford to pay. Homeowners also avoid the heavy stigma that comes with foreclosure. Besides the credit hit, going through a foreclosure is tremendously uncomfortable. Furthermore, with an adjustment to their monthly payment, they will not have to worry about putting down a large security deposit or moving to a less desirable area because they can no longer afford their current residence.

How does the Deed for Lease Program Affect Fannie Mae?

Fannie Mae should see more of a mixed bag with this program. On the positive side, they should experience less degradation of value than if the home simply sat idle. Vacant foreclosed homes experience a tremendous amount maintenance issues and vandalism. Additionally, Fannie Mae will avoid the foreclosure process, saving them significant dollars in court costs and eviction fees.

Conversely, Fannie Mae will lose the opportunity to quickly monetize their losses. Delaying the inevitable will not lessen the blow. While renters will certainly keep the house in better condition than if the house were to sit vacant, Fannie Mae can be sure that a foreclosed tenant will not be a good tenant. Furthermore, the asset management costs of managing individual houses will be astronomical. Perhaps to be part of the program renters will have to agree to maintain the house to a certain standard, but short of that, it will be a logistical and financial nightmare.

Lastly, what happens when the year is up? Fannie Mae could potentially need to spend similar costs to evict tenants and go through the same vacant home scenario. Does the tenant need to agree that Fannie Mae can market the house for sale while they continue to occupy it?

While this program seems like a great consumer opportunity on the surface, taxpayers should ask important questions about the ramifications. It is they who will need to pay for the asset management of these properties and subsidize the below market rents. While no one wants to see a family evicted from their home, the current process is in place for a reason.